<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 17, 2000
REGISTRATION NO. 333-31546
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
IPASS INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 7389 93-1214598
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
3800 BRIDGE PARKWAY
REDWOOD SHORES, CA 94065
(650) 232-4100
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
MICHAEL H. MANSOURI
CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER
3800 BRIDGE PARKWAY
REDWOOD SHORES, CA 94065
(650) 232-4100
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES TO:
ALAN C. MENDELSON, ESQ.
BRETT D. WHITE, ESQ.
COOLEY GODWARD LLP
FIVE PALO ALTO SQUARE
3000 EL CAMINO REAL
PALO ALTO, CA 94306-2155
(650) 843-5000
JAMES S. SCOTT, SR., ESQ.
SHEARMAN & STERLING
599 LEXINGTON AVENUE
NEW YORK, NY 10022
(212) 848-4000
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after this Registration Statement becomes effective
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), check the following box. [ ]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE> 2
EXPLANATORY NOTE
This Amendment No. 1 to the Form S-1 Registration Statement is being filed
for the sole purpose of filing additional exhibits.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses, other than the underwriting
discounts and commissions, payable by iPass in connection with the sale of the
Common Stock being registered. All the amounts shown are estimates except for
the registration fee, the NASD filing fee and the Nasdaq National Market
application fee.
<TABLE>
<S> <C>
Registration fee............................................ $
NASD filing fee............................................. $
Nasdaq National Market application fee...................... $
Blue sky qualification fee and expenses..................... $
Printing and engraving expenses............................. $
Legal fees and expenses..................................... $
Accounting fees and expenses................................ $
Transfer agent and registrar fees........................... $
Miscellaneous............................................... $
-------
Total..................................................... $
=======
</TABLE>
ITEM 14. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
As permitted by Delaware law, our amended and restated certificate of
incorporation provides that no director of ours will be personally liable to us
or our stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability:
- for any breach of duty of loyalty to us or to our stockholders;
- for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law;
- under Section 174 of the Delaware General Corporation Law; or
- for any transaction from which the director derived an improper personal
benefit.
Our amended and restated certificate of incorporation further provides that
we must indemnify our directors and executive officers and may indemnify its
other officers and employees and agents to the fullest extent permitted by
Delaware law. We believe that indemnification under our amended and restated
certificate of incorporation covers negligence and gross negligence on the part
of indemnified parties.
We have entered into indemnification agreements with each of our directors
and officers. These agreements, among other things, require us to indemnify each
director and officer for some expenses including attorneys' fees, judgments,
fines and settlement amounts incurred by any of these persons in any action or
proceeding, including any action by or in the right of iPass, arising out of
person's services as our director or officer, any subsidiary of ours or any
other company or enterprise to which the person provides services at our
request.
The underwriting agreement will provide for indemnification by the
underwriters of iPass, our directors, our officers who sign the registration
statement, and our controlling persons for some liabilities, including
liabilities arising under the Securities Act.
II-1
<PAGE> 3
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
Since January 1, 1997, we has sold and issued the following unregistered
securities:
(1) From January 1997 through December 31, 1999, we have granted stock
options to purchase 13,580,934 shares of common stock, at a weighted
average exercise price of $0.348, to employees, consultants and directors
pursuant to its 1997 Stock Option Plan, 1999 Interim Stock Option Plan and
1999 Stock Option Plan, 1,180,837 shares have been cancelled or have lapsed
without being exercised, 9,485,863 shares have been exercised in common
stock, no shares of which have been repurchased and 2,914,234 shares remain
outstanding.
(2) In October 1999, the Board of Directors approved a compensatory
restricted stock grant of 110,334 shares of our common stock at a purchase
price of $1.50 per share. These shares are subject to repurchase by us at
the original purchase price. The repurchase right lapses 25% after the
first year of service, and ratably for an additional 36 months. As of
December 31, 1999, no shares of common stock have been repurchased.
(3) In June 11, 1997, we issued an aggregate of 3,621,246 shares of
Series C preferred stock. Shares of Series C preferred stock are
convertible into shares of common stock at the rate of one share of common
stock for each share of Series C preferred stock outstanding.
(4) In December 31, 1997, we issued an aggregate of 8,077,998 shares
of Series D preferred stock. Shares of Series D preferred stock are
convertible into shares of common stock at the rate of one share of common
stock for each share of Series D preferred stock outstanding.
(5) In September 13, 1999, we issued an aggregate of 5,477,574 shares
of Series E preferred stock. Shares of Series E preferred stock are
convertible into shares of common stock at the rate of one share of common
stock for each share of Series E preferred stock outstanding.
(6) In December 31, 1997, we issued a warrant to purchase 82,587
shares of Series D preferred stock to Comdisco, Inc. at an exercise price
of $1.44 per share. Shares of Series D preferred stock are convertible into
shares of common stock at the rate of one share of common stock for each
share of Series D preferred stock outstanding.
(7) In July 19, 1999, we issued a warrants to purchase 211,686 shares
of Series E preferred stock to Comdisco, Inc. and MMC/Meier Mitchell
Partnership No. 1 at a weighted average exercise price of $2.43 per share.
Shares of Series D preferred stock are convertible into shares of common
stock at the rate of one share of common stock for each share of Series D
preferred stock outstanding.
The sales and issuances of securities described in paragraph (1) and (2)
above were deemed to be exempt from registration under the Securities Act by
virtue of Rule 701 promulgated thereunder in that they were offered and sold
either pursuant to a written compensatory benefit plan or pursuant to a written
contract relating to compensation, as provided by Rule 701.
The sale and issuance of securities described in paragraphs (3) through (7)
above were deemed to be exempt from registration under the Securities Act by
virtue of Section 4(2), or Regulation D promulgated thereunder.
II-2
<PAGE> 4
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------- -----------------------
<C> <S>
1.1* Form of Underwriting Agreement.
3.1** Restated Certificate of Incorporation of Registrant.
3.2** Form of Restated Certificate of Incorporation of Registrant
to be filed upon the closing of the offering made pursuant
to this Registration Statement.
3.3** Bylaws of the Registrant, as currently in effect.
4.1* Specimen Common Stock Certificate.
4.2 Reference is made to Exhibits 3.2 and 3.3.
5.1* Opinion of Cooley Godward LLP.
10.1** Amended and Restated Investor Rights Agreement dated
September 13, 1999 between Registrant and holders of the
Registrant's founders and Series A Preferred Stock, Series B
Preferred Stock, Series C Preferred Stock, Series D
Preferred Stock and Series E Preferred Stock.
10.2** Amended and Restated Shareholders Agreement dated September
13, 1999 between Registrant and holders of the Registrant's
founders and Series A Preferred Stock, Series B Preferred
Stock, Series C Preferred Stock, Series D Preferred Stock
and Series E Preferred Stock.
10.3** Form of Indemnity Agreement.
10.4** 1997 Stock Option Plan and forms of related agreements.
10.5** 1999 Interim Stock Option Plan and forms of related
agreements.
10.6** 1999 Stock Option Plan and form of related agreements.
10.7** 2000 Equity Incentive Plan and form of related agreement.
10.8** 2000 Employee Stock Purchase Plan.
10.9 Lease Agreement, dated October 26, 1999, between Registrant
and Westport Joint Venture.
10.10+ Dial Up Network Services Agreement by and between the
Registrant and GTE Internetworking Incorporated dated
October 15, 1996.
10.11+ Virtual Internet Provider Agreement by and between UUNET
Technologies, Inc. and the Registrant dated January 9, 1997.
10.12+ Network Services Agreement by and between Compuserve
Incorporated and the Registrant dated November 4, 1997.
10.13+ Managed Data Network Services Agreement by and between
Equant Network Services, Inc. and the Registrant dated as of
September 17, 1996.
10.14+** Solution Partner Reseller Agreement by and between the
Registrant and Fiberlink Communications dated September 4,
1998.
10.15** Employment Agreement, dated May 10, 1999, between Registrant
and Michael H. Mansouri.
10.16** Separation Agreement, dated August 19, 1999, between
Registrant and Christopher J. Moore.
10.17** Form of Offer Letter to senior executive officers.
10.18** Separation Agreement, dated October 29, 1999, between the
Registrant and Robert C. Schoettle.
10.19+ OEM Service Provider License Agreement by and between RSA
Security, Inc. and the Registrant dated February 29, 2000.
23.1** Consent of Arthur Andersen LLP, Independent Public
Accountants.
23.2 Consent of Cooley Godward LLP (included in Exhibit 5.1).
</TABLE>
II-3
<PAGE> 5
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------- -----------------------
<C> <S>
24.1** Power of Attorney. Reference is made to the signature page.
27.1** Financial Data Schedule.
</TABLE>
- -------------------------
* To be filed by amendment.
** Previously filed.
+ Confidential treatment has been requested for a portion of this exhibit.
(b) FINANCIAL STATEMENT SCHEDULES.
All schedules are omitted because they are not required, they are not
applicable or the information is already included in the financial statements or
notes thereto.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) That for purposes of determining any liability under the
Securities Act, the information omitted from the form of this prospectus
filed as part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be
part of this Registration Statement as of the time it was declared
effective.
(2) That for purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of the securities at that
time shall be deemed to be the initial bona fide offering thereof.
(3) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions referenced in Item 15
of this Registration Statement or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission this
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against these liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer, or
controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by a director, officer, or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether the indemnification by it is against
public policy as expressed in the Securities Act of 1933, and will be
governed by the final adjudication of this issue.
(4) To provide to the Underwriters at the closing specified in the
Underwriting Agreement certificates in the denomination and registered in
the names required by the Underwriters to permit prompt delivery to each
purchaser.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has caused this Amendment No. 1 to the Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized in the city of Redwood
Shores, in the County of San Mateo, State of California, on the 17th day of
March, 2000.
IPASS INC.
By: /s/ MICHAEL H. MANSOURI
------------------------------------
Michael H. Mansouri
Chairman, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
---------- ----- ----
<S> <C> <C>
/s/ MICHAEL H. MANSOURI Chairman of the Board of March 17, 2000
- ----------------------------------------------------- Directors, President, Chief
Michael H. Mansouri Executive Officer (principal
executive officer)
*/s/ DONALD C. MCCAULEY Vice President and Chief March 17, 2000
- ----------------------------------------------------- Financial Officer (principal
Donald C. McCauley financial and accounting
officer)
*/s/ JOHN S. ALSOP Director March 17, 2000
- -----------------------------------------------------
John S. Alsop
*/s/ ARTHUR C. PATTERSON Director March 17, 2000
- -----------------------------------------------------
Arthur C. Patterson
*/s/ PETER G. BODINE Director March 17, 2000
- -----------------------------------------------------
Peter G. Bodine
*/s/ SETH D. NEIMAN Director March 17, 2000
- -----------------------------------------------------
Seth D. Neiman
*/s/ GEORGE M. TRONSRUE, III Director March 17, 2000
- -----------------------------------------------------
George M. Tronsrue, III
*/s/ JOHN D. BELETIC Director March 17, 2000
- -----------------------------------------------------
John D. Beletic
</TABLE>
*By: /s/ MICHAEL H. MANSOURI
----------------------------------------------------
Michael H. Mansouri
Attorney-in-Fact
II-5
<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- --------- -----------------------
<C> <S>
1.1* Form of Underwriting Agreement.
3.1** Restated Certificate of Incorporation of Registrant.
3.2** Form of Restated Certificate of Incorporation of Registrant
to be filed upon the closing of the offering made pursuant
to this Registration Statement.
3.3** Bylaws of the Registrant, as currently in effect.
4.1* Specimen Common Stock Certificate.
4.2 Reference is made to Exhibits 3.2 and 3.3.
5.1* Opinion of Cooley Godward LLP.
10.1** Amended and Restated Investor Rights Agreement dated
September 13, 1999 between Registrant and holders of the
Registrant's founders and Series A Preferred Stock, Series B
Preferred Stock, Series C Preferred Stock, Series D
Preferred Stock and Series E Preferred Stock.
10.2** Amended and Restated Shareholders Agreement dated September
13, 1999 between Registrant and holders of the Registrant's
founders and Series A Preferred Stock, Series B Preferred
Stock, Series C Preferred Stock, Series D Preferred Stock
and Series E Preferred Stock.
10.3** Form of Indemnity Agreement.
10.4** 1997 Stock Option Plan and forms of related agreements.
10.5** 1999 Interim Stock Option Plan and forms of related
agreements.
10.6** 1999 Stock Option Plan and form of related agreements.
10.7** 2000 Equity Incentive Plan and form of related agreement.
10.8** 2000 Employee Stock Purchase Plan.
10.9 Lease Agreement, dated October 26, 1999, between Registrant
and Westport Joint Venture.
10.10+ Dial Up Network Services Agreement by and between the
Registrant and GTE Internetworking Incorporated dated
October 15, 1996.
10.11+ Virtual Internet Provider Agreement by and between UUNET
Technologies, Inc. and the Registrant dated January 9, 1997.
10.12+ Network Services Agreement by and between Compuserve
Incorporated and the Registrant dated November 4, 1997.
10.13+ Managed Data Network Services Agreement by and between
Equant Network Services, Inc. and the Registrant dated as of
September 17, 1996.
10.14+** Solution Partner Reseller Agreement by and between the
Registrant and Fiberlink Communications dated September 4,
1998.
10.15** Employment Agreement, dated May 10, 1999, between Registrant
and Michael H. Mansouri.
10.16** Separation Agreement, dated August 19, 1999, between
Registrant and Christopher J. Moore.
10.17** Form of Offer Letter to senior executive officers.
10.18** Separation Agreement, dated October 29, 1999, between the
Registrant and Robert C. Schoettle.
10.19+ OEM Service Provider License Agreement by and between RSA
Security, Inc. and the Registrant dated February 29, 2000.
23.1** Consent of Arthur Andersen LLP, Independent Public
Accountants.
23.2 Consent of Cooley Godward LLP (included in Exhibit 5.1).
24.1*** Power of Attorney. Reference is made to the signature page.
27.1*** Financial Data Schedule.
</TABLE>
- -------------------------
* To be filed by amendment.
** Previously filed.
+ Confidential treatment has been requested for a portion of this exhibit.
<PAGE> 1
EXHIBIT 10.9
LEASE AGREEMENT
THIS LEASE, made this 26th day of October, 1999 between WESTPORT JOINT
VENTURE, a California joint venture, hereinafter called Landlord, and IPASS,
INC., a California corporation, hereinafter called Tenant.
WITNESSETH:
Landlord hereby leases to Tenant and Tenant hereby hires and takes from
Landlord those certain premises the "Premises" outlined in red on Exhibit "A",
attached hereto and incorporated herein by this reference thereto more
particularly described as follows:
All of that certain 48,384+ square foot, two-story building located at
3800 Bridge Parkway, Redwood City, California 94065. Said Premises is more
particularly shown within the area outlined in Red on EXHIBIT A attached hereto.
The entire parcel, of which the Premises is a part, is shown within the area
outlined in Green on EXHIBIT A attached. The Premises shall be improved by
Landlord as shown on EXHIBIT B to be attached hereto, and is leased on an
"as-is" basis, in its present condition, and in the configuration as shown in
Red on EXHIBIT B to be attached hereto.
As used herein the Complex shall mean and include all of the land
outlined in Green and described in Exhibit "A", attached hereto, common area
private roads within the Complex, and all of the buildings, improvements,
fixtures and equipment now or hereafter situated on said land.
Said letting and hiring is upon and subject to the terms, covenants and
conditions hereinafter set forth and Tenant covenants as a material part of the
consideration for this Lease to perform and observe each and all of said terms,
covenants and conditions. This Lease is made upon the conditions of such
performance and observance.
1. USE.
Tenant shall use the Premises only in conformance with applicable governmental
laws, regulations, rules and ordinances for the purpose of general office, light
manufacturing, research and development, and storage and other uses necessary
for Tenant to conduct Tenant's business, provided that such uses shall be in
accordance with all applicable governmental laws and ordinances and for no other
purpose. Tenant shall not do or permit to be done in or about the Premises or
the Complex nor bring or keep or permit to be brought or kept in or about the
Premises or the Complex anything which is prohibited by or will in any way
increase the existing rate of (or otherwise affect) fire or any insurance
covering the Complex or any part thereof, or any of its contents, or will cause
a cancellation of any insurance covering the Complex or any part thereof, or any
of its contents. Tenant shall not do or permit to be done anything in, on or
about the Premises or the Complex which will in any way obstruct or interfere
with the rights of other tenants or occupants of the Complex or injure or annoy
them, or use or allow the Premises to be used for any improper, immoral,
unlawful or objectionable purpose, nor shall Tenant cause, maintain or permit
any nuisance in, on or about the Premises or the Complex. No sale by suction
shall be permitted on the Premises. Tenant shall not place any loads upon the
floors, walls, or ceiling, which endanger the structure, or place any harmful
fluids or other materials in the
1.
<PAGE> 2
drainage system of the building, or overload existing electrical or
other mechanical systems. No waste materials or refuse shall be dumped upon or
permitted to remain upon any part of the Premises or outside of the building in
which the Premises are a part, except in trash containers placed inside exterior
enclosures designated by Landlord for that purpose or inside of the building
proper where designated by Landlord. No materials, supplies, equipment, finished
products or semi-finished products, raw materials or article of any nature shall
be stored upon or permitted to remain outside the Premises or on any portion of
common area of the Complex. No loudspeaker or other device, system or apparatus
which can be heard outside the Premises shall be used in or at the Premises
without the prior written consent of Landlord. Tenant shall not commit or suffer
to be committed any waste in or upon the Premises. Tenant shall indemnify,
defend and hold Landlord harmless against any loss, expense, damage, attorneys'
fees, or liability arising out of failure of Tenant to comply with any
applicable law. Tenant shall comply with any covenant, condition, or restriction
("CC&R's") affecting the Premises. The provisions of this paragraph are for the
benefit of Landlord only and shall not be construed to be for the benefit of any
tenant or occupant of the Complex.
2. TERM.*
A. The term of this Lease shall be for a period of ten (10) years, one
(1) month, seventeen (17) days (unless sooner terminated as hereinafter
provided) and, subject to Paragraphs 2(B) and 3, shall commence on the 15th day
of January, 2000 and end on the 28th day February of 2010.
B. Possession of the Premises shall be deemed tendered and the term of
this Lease shall commence when the first of the following occurs:
(a) One day after a Certificate of Occupancy is granted by the proper
governmental agency, or, if the governmental agency having jurisdiction over the
area in which the Premises are situated does not issue certificates of
occupancy, then the same number of days after certification by Landlord's
architect or contractor that Landlord's construction work has been completed,
and Landlord has delivered possession of the Premises to Tenant; or
(b) Upon the occupancy of the Premises by any of Tenant's operating
personnel; or
(c) When the Tenant Improvements have been substantially completed
for Tenant's use and occupancy, in accordance and compliance with Exhibit B of
this Lease Agreement and Landlord has delivered the Premises to Tenant; or
(d) As otherwise agreed in writing.
3. POSSESSION.
- --------
* It is agreed in the event said Lease commences on a date other than the first
day of the month the term of the Lease will be extended to account for the
number of days in the partial month. The Basic Rent during the resulting partial
month will be pro-rated (for the number of days in the partial month) at the
Basic Rent scheduled for the projected commencement date as shown in Paragraph
43.
2.
<PAGE> 3
If Landlord, for any reason whatsoever, cannot deliver possession of
said premises to Tenant at the commencement of the said term, as hereinbefore
specified, this Lease shall not be void or voidable; no obligation of Tenant
shall be affected thereby; nor shall Landlord or Landlord's agents be liable to
Tenant for any loss or damage resulting therefrom; but in that event the
commencement and termination dates of the Lease, and all other dates affected
thereby shall be revised to conform to the date of Landlord's delivery of
possession, as specified in Paragraph 2(b) above. The above is, however, subject
to the provision that the period of delay of delivery of the premises shall not
exceed 60 days from the commencement date herein (except those delays caused by
Acts of God strikes, war, utilities, governmental bodies, weather, unavailable
materials, and delays beyond Landlord's control shall be excluded in calculating
such period) in which instance Tenant, at its option, may, by written notice to
Landlord, terminate this Lease.
4. RENT
A. BASIC RENT. Tenant agrees to pay to Landlord at such place as
Landlord may designate without deduction, offset, prior notice or demand, and
Landlord agrees to accept as Basic Rent for the leased Premises the total sum of
Twenty Five Million Nine Hundred Seventy Two Thousand Eight Hundred Forty three
and 35/100 ($25,972,843.35) Dollars in lawful money of the United States of
America, payable as follows:
See Paragraph 43 for Basic Rent Schedule
B. TIME FOR PAYMENT. In the event that the term of this Lease commences
on a date other than the first day of a calendar month, on the date of
commencement of the term hereof Tenant shall pay to Landlord as rent for the
period from such date of commencement to the first day of the next succeeding
calendar month that proportion of the monthly rent hereunder which the number of
days between such date of commencement and the first day of the next succeeding
calendar month bears to thirty (30). In the event that the term of this Lease
for any reason ends on a date other than the last day of a calendar month, on
the first day of the last calendar month of the term hereof Tenant shall pay to
Landlord as rent for the period from said first day of said last calendar month
to and including the last day of the term hereof that proportion of the monthly
rent hereunder which the number of days between said first day of said last
calendar month and the last day of the term hereof bears to thirty (30).
C. LATE CHARGE. Notwithstanding any other provision of this Lease. If
Tenant is in default in the payment of rental as set forth in this Paragraph 4
when due, or any part thereof, Tenant agrees to pay Landlord. In addition to the
delinquent rental due, a late charge for each rental payment in default ten (10)
days. Said late charge shall equal ten (10%) percent of each rental payment so
in default.
D. ADDITIONAL RENT. Beginning with the commencement date of the term of
this Lease. Tenant shall pay to Landlord in addition to the Basic Rent and as
Additional Rent the following:
(a) Tenant's proportionate share of all Taxes relating to the
Complex as set forth in Paragraph 12, and
3.
<PAGE> 4
(b) Tenant's proportionate share of all insurance premiums and
deductibles relating to the Complex, as set forth in Paragraph 15, and
(c) Tenant's proportionate share of expenses for the operation,
management, maintenance and repair of the Building (including common area of the
Building) and Common Areas of the Complex in which the Premises are located as
set forth in Paragraph 7, and
(d) All charges, costs and expenses, which Tenant is required to pay
hereunder, together with all interest and penalties, costs and expenses
including attorneys' fees and legal expenses, that may accrue thereto in the
event of Tenant's failure to pay such amounts, and all damages, reasonable costs
and expenses which Landlord may incur by reason of default of Tenant or failure
on Tenant's part to comply with the terms of this Lease. In the event of
nonpayment by Tenant of Additional Rent, Landlord shall have all the rights and
remedies with respect thereto as Landlord has for nonpayment of rent.
The Additional Rent due hereunder shall be paid to Landlord or
Landlord's agent (i) within five (5) days for taxes and insurance and within
thirty (30) days for all other Additional Rent items after presentation of
invoice from Landlord or Landlord's agent setting forth such additional Rent
and/or (ii) at the option of Landlord. Tenant shall pay to Landlord monthly, in
advance, Tenant's prorate share of an amount estimated by Landlord to be
Landlord's approximate average monthly expenditure for such Additional Rent
Items, which estimated amount shall be reconciled within 120 days of the end of
each calendar year or more frequently if Landlord so elects to do so at
Landlord's sole and absolute discretion, as compared to Landlord's actual
expenditure for said Additional Rent items, with Tenant paying to Landlord, upon
demand, any amount of actual expenses expended by Landlord in excess of said
estimated amount, or Landlord crediting to Tenant (providing Tenant is not in
default in the performance of any for the terms, covenants and conditions of
this Lease) any amount of estimated payments made by Tenant in excess of
Landlord's actual expenditures for said Additional Rent items. Within thirty
(30) days after receipt of Landlord's reconciliation, Tenant shall have the
right, at Tenant's sole expense, to audit, at a mutually convenient time at
Landlord's office, Landlord's records relating to the foregoing expenses. Such
audit must be conducted by Tenant or an independent nationally recognized
accounting firm that is not being compensated by Tenant or other third party on
a contingency fee basis. Landlord shall be provided a complete copy of said
audit at no expense to Landlord. If such audit reveals that Landlord has
overcharged Tenant and the audit is not challenged by Landlord, the amount
overcharged shall be credited to Tenant's account within thirty (30) days after
the audit is concluded.
The respective obligations of Landlord and Tenant under this paragraph
shall survive the expiration or other termination of the term of this lease, and
if the term hereof shall expire or shall otherwise terminate on a day other than
the last day of a calendar year, the actual Additional Rent incurred for the
calendar year in which the term hereof expires or otherwise terminates shall be
determined and settled on the basis of the statement of actual Additional Rent
for such calendar year and shall be prorated in the proportion which the number
of days in such calendar year pricing such expiration or termination bears to
365.
E. FIXED MANAGEMENT FEE. Beginning with the Commencement Date of the
term of this Lease, Tenant shall pay, in addition to the Basic Rent and
Additional Rent, a fixed monthly
4.
<PAGE> 5
management fee ("Management Fee") equal to two percent (2%) of the Basic Rent
due for each month during the Lease term. Said Management Fee shall be paid by
Tenant to A&P Property Management Company at 2560 Mission College Blvd., Suite
101, Santa Clara, CA 95054.
F. PLACE OF PAYMENT OF RENT AND ADDITIONAL RENT. All Basic Rent
hereunder and all payments hereunder for Additional Rent shall be paid to
Landlord at the office of Landlord at Westport Joint Venture, 2560 Mission
College Blvd., Suite 101, Santa Clara, CA 95054 or to such other person or to
such other place as Landlord may from time to time designated in writing.
G. SECURITY DEPOSIT. Concurrently with Tenant's execution of this Lease,
Tenant shall deposit with Landlord the sum of Four Hundred Ninety Three Thousand
Five Hundred Sixteen and 80/100 ($493,516.80) Dollars. Said sum shall be held by
Landlord as a Security Deposit for the faithful performance by Tenant of all of
the terms, covenants, and conditions of this Lease to be kept and performed by
Tenant during the term hereof. If Tenant defaults with respect to any provision
of this Lease, including, but not limited to, the provisions relating to the
payment of rent and any of the monetary sums due herewith, Landlord may (but
shall not be required to) use, apply or retain all or any part of this Security
Deposit for the payment of any other amount which Landlord may spend by reason
of Tenant's default or to compensate Landlord for any other loss or damage which
Landlord may suffer by reason of Tenant's default. If any portion of said
Deposit is so used or applied. Tenant shall, within ten (10) days after written
demand therefor, deposit cash with Landlord in the amount sufficient to restore
the Security Deposit to its original amount. Tenant's failure to do so shall be
a material breach of this Lease. Landlord shall not be required to keep this
Security Deposit separate from its general funds, and Tenant shall not be
entitled to interest on such Deposit. If Tenant fully and faithfully performs
every provision of this Lease to be performed by it, the Security Deposit or any
balance thereof shall be returned to Tenant (or at Landlord's option, to the
last assignees of Tenant's interest hereunder) at the expiration of the Lease
term and after Tenant has vacated the Premises. In the event of termination of
Landlord's interest in this Lease, Landlord shall transfer said Deposit to
Landlord's successor in interest whereupon Tenant agrees to release Landlord
from liability for the return of such Deposit or the accounting therefor. See
Paragraph 57.
5. RULES AND REGULATIONS AND COMMON AREA.
Subject to the term of conditions of this Lease and such reasonable Rules and
Regulations as Landlord may from time to time prescribe, Tenant and Tenant's
employees, invitees and customers shall, in common with other occupants of the
Complex in which the Premises are located, and their respective employees,
invoices and customers, and others entitled to the use thereof, have the
non-exclusive right to use the access roads, parking areas, and facilities
provided and designated by Landlord for the general use and convenience of the
occupants of the Complex in which the Premises are located, which areas and
facilities are referred to herein as "Common Area". This right shall terminate
upon the termination of this Lease, Landlord reserves the right from time to
time to make changes in the shape, size, location, amount and extent of Common
Area. Landlord further reserves the right to promulgate such reasonable rules
and regulations relating to the use of the Common Area, and any party or parts
thereof, as Landlord may deem appropriate for the best interests of the
occupants of the Complex. The Rules and Regulations shall be binding upon Tenant
upon delivery of a copy of them to Tenant,
5.
<PAGE> 6
and Tenant shall abide by them and cooperate in the observance. Such Rules and
Regulations may be reasonably amended by Landlord from time to time, with or
without advance notice, and all amendments shall be effective upon delivery of a
copy to Tenant, Landlord shall not be responsible to Tenant for the
non-performance by any other tenant or occupant of the Complex of any of said
Rules and Regulations.
Landlord shall operate, manage and maintain the Common Area. The manner
in which the Common Area shall be maintained and the expenditure for such
maintenance shall be at the discretion of Landlord. Landlord's rights pursuant
to this Paragraph 5 shall be subject to the condition that exercise of any such
rights shall not unreasonably interfere with Tenant's use of the Premises.
6. PARKING.
Tenant shall have the right to use with other tenants or occupants of
the Complex 161 parking spaces in the common parking areas of the Complex.
Tenant agrees, that Tenant, Tenant's employees, agents, representatives and/or
invitees shall not use parking spaces in excess of said 161 spaces allocated to
Tenant hereunder. Landlord shall have the right, at Landlord's sole discretion,
to specifically designate the location of Tenant's parking spaces within the
common parking areas of the Complex in the event of a dispute among the tenants
occupying the building and/or Complex referred to herein, in which event Tenant
agrees that Tenant, Tenant's employees, agents, representatives and/or invitees
shall not use any parking spaces other than those parking spaces specifically
designated by Landlord for Tenant's use. Said parking spaces, if specifically
designated by Landlord to Tenant, may be relocated by Landlord at any time, and
from time to time, Landlord reserves the right, at Landlord's sole discretion,
to rescind any specific designation of parking spaces. Tenant shall not, at any
time, park or permit to be parked, any trucks or vehicles adjacent to the
loading area as to interfere in any way with the use of such areas, nor shall
Tenant at any time park, or permit the parking of Tenant's 'trucks or other
vehicles or the trucks and vehicles of Tenant's suppliers or others, in any
portion of the common parking area or other common areas of the Complex. Tenant
agrees to assume responsibility for compliance by its employees with the parking
provision contained herein. If Tenant or its employees park in other than such
designated parking areas, the Landlord may charge Tenant, as an additional
charge, and Tenant agrees to pay, ten ($10.00) Dollars per day for each day or
partial day each such vehicle is parked in any area other than that designated.
Tenant hereby authorizes Landlord at Tenant's sole expense to tow away from the
Complex any vehicle belong to Tenant or Tenant's employees parked in violation
of these provisions, or to attach violation stickers or notices to such
vehicles. Tenant shall use the parking area for vehicle parking only, and shall
not use the parking area for storage.
7. EXPENSES OF OPERATION, MANAGEMENT, AND MAINTENANCE OF THE COMMON AREAS
OF THE COMPLEX.
As Additional Rent and in accordance with Paragraph 4D of this Lease,
Tenant shall pay to Landlord Tenant's proportionate share (calculated on a
square footage or other equitable basis as calculated by Landlord) of all
expense of operations, management, maintenance and repair of the Common Areas of
the Complex including, but not limited to, license, permit, and inspection fees;
security; utility charges associated with exterior landscaping and lighting
(including water
6.
<PAGE> 7
and sewer charges); all charges incurred in the maintenance and replacement of
landscaped areas, private roads within the Complex and roads with reciprocal
easement areas; lakes, parking lots and paved areas (including repairs,
replacement, resealing and restriping), sidewalks, driveways; maintenance,
repair and replacement of all fixtures and electrical, mechanical, and plumbing
systems; structural elements and exterior surfaces of the buildings; salaries
and employee benefits of personnel and payroll taxes applicable thereto;
suppliers, materials, equipment and tools; the cost of capital expenditures
which have the effect of reducing opening expenses, provided, however, that in
the event Landlord makes such capital improvements, Landlord may amortize its
investment in said improvements (together with interest at the rate of fifteen
(15%) percent per annum on the unamortized balance) as an operating expense in
accordance with standard accounting practices, provided, that such amortization
is not at a rate greater than the anticipated savings in the operating expenses.
"Additional Rent" as used herein shall not include Landlord's debt
repayments; interest on changes; expenses directly or indirectly incurred by
Landlord for the benefit of any other tenant; cost for the installation of
partitioning or any other tenant improvements; cost of attracting tenants;
depreciation; interest, or executive salaries.
8. ACCEPTANCE AND SURRENDER OF PREMISES.
By entry hereunder, Tenant accepts the Premises as being in good and sanitary
order, condition and repair and accepts the building and improvements included
in the Premises in the present condition and without representation or warranty
by Landlord as to the condition of such building or as to the use or occupancy
which may be made thereof. Any expectations to the foregoing must be by written
agreement executed by Landlord and Tenant. Tenant agrees on the last day of the
Lease term, or on the sooner termination of this Lease, to surrender the
Premises promptly and peaceably to Landlord in good condition and repair (damage
by Acts of God, fire, normal wear and tear excepted), with all interior walls
painted, or cleaned so that they appear freshly painted, and repaired and
replaced, if damaged; all floors cleaned and waxed; all carpets cleaned and
shampooed; the air conditioning and hearing equipment serviced by a reputable
and licensed service firm and in good operating condition (provided the
maintenance of such equipment has been Tenant's responsibility during the term
of this Lease) together with all alterations, additions, and improvements which
may have been made in, to, or on the Premises (except movable trade fixtures
installed at the expense of Tenant) except that Tenant shall ascertain from
Landlord within thirty (30) days before the end of the term of this Lease
whether Landlord desires to have the Premises or any part or parts thereof
restored to their condition and configuration as when the Premises were
delivered to Tenant and if Landlord shall so desire, the Tenant shall restore
said Premises or such part or parts thereof before the end of the Lease at
Tenant's sole cost and expense. Tenant, on or before the end to the term or
sooner termination of this Lease, shall remove all of Tenant's personal property
and trade fixtures from the Premises, and all property not so removed on or
before the end of the term or sooner termination of this Lease, shall remove all
of Tenant's personal property and trade fixtures from the Premises, and all
property not so remove on or before the end of the term or sooner termination of
this Lease shall be deemed abandoned by Tenant and title to same shall thereupon
pass to Landlord without compensation to Tenant. Landlord may, upon termination
of this Lease, remove all moveable furniture and equipment so abandoned by
Tenant, at Tenant's sole cost, and repair any damage caused by such removal at
Tenant's sole cost. If the Premises be not surrendered at the end of
7.
<PAGE> 8
the term or sooner termination of this Lease, Tenant shall indemnify Landlord
against loss or liability resulting from the delay by Tenant in so surrendering
the Premises including, without limitation, any claims made by any succeeding
tenant founded on such delay. Nothing contained herein shall be construed as an
extension of the term hereof or as a consent of Landlord to any holding over by
Tenant. The voluntary or other surrender of this Lease or the Premises by Tenant
or a mutual cancellation of this Lease shall not work as a merger and, at the
option of Landlord, shall either terminate all or any existing sublease or
subtenancies or operate as an assignment to Landlord of all or any such
subleases or subtenancies.
9. ALTERATIONS AND ADDITIONS.
Tenant shall not make, or suffer to be made, any alteration or addition
to the Premises, or any part thereof, without the written consent (which written
consent will specify whether Landlord shall require removal of said alterations
and/or additions, provided Tenant requests such determination from Landlord), of
Landlord first had and obtained by Tenant (which approval shall not be
unreasonably withheld) but at the cost of Tenant, and any addition to, or
alteration of, the Premises, except moveable furniture and trade fixtures, shall
at once become a part to the Premises and belong to Landlord. Landlord reserves
the right to approve all contractors and mechanics proposed by Tenant to make
such alterations and additions. Tenant shall retain title to all moveable
furniture and trade fixtures placed in the Premises. All heating, lighting,
electrical air conditioning, floor to ceiling partitioning, drapery, carpeting,
and floor installation made by Tenant, together with all property that has
become an integral part of the Premises, shall not be deemed trade fixtures.
Tenant agrees that it will not proceed to make such alteration or additions,
without having obtained consent from Landlord to do so, and until five (5) days
from the receipt of such consent, in order that Landlord may post appropriate
notices to avoid any liability to contractors or material suppliers for payment
for Tenant's improvements. Tenant will at all times permit such notices to be
posted and to remain posted until the completion of work. Tenant shall, if
required by Landlord, secure at Tenant's own cost and expense, a completion and
lien indemnity bond, satisfactory to Landlord, for such work. Tenant further
covenants and agrees that any mechanic's lien filed against the Premises or
against the Complex for work claimed to have been done for, or materials claimed
to have been furnished to Tenant, will be discharged by Tenant, by bond or
otherwise, within ten (10) days after the filing thereof, at the cost and
expense of Tenant. Any exceptions to the foregoing must be made in writing and
executed by both Landlord and Tenant. Notwithstanding anything to the contrary
herein, under no circumstances shall Tenant be authorized to penetrate the soil
to a depth that exceeds three and one-half feet from the uppermost surface of
the soil.
10. TENANT MAINTENANCE.
Tenant shall, at its sole cost and expense, keep and maintain the Premises
(including appurtenances) and every part thereof in a high standard of
maintenance and repair, and in good and sanitary condition. Tenant's maintenance
and repair responsibilities herein referred to include, but are not limited to,
all windows, window frames, plate glass, glazing, truck doors, plumbing systems
(such as water and drain lines, sinks, toilets, faucets, drains, showers and
water fountains), electrical system (such as panels, conduits, outlets, lighting
fixtures, lamps, bulbs, tubes, ballasts), heating and air-conditioning systems
(such as compressors, fans, air handlers, ducts, mixing boxes, thermostats, time
clocks, boilers, heaters, supply and return
8.
<PAGE> 9
grills), store fronts, roofs, downspouts, all interior improvements within the
premises including but not limited to wall coverings, window coverings, carpet,
floor coverings, partitioning, ceilings, doors (both interior and exterior,
including closing mechanisms, latches, locks, skylights (if any), automatic fire
extinguishing systems, and elevators and all other interior improvements of any
nature whatsoever. Tenant agrees to provide carpet shields under all rolling
chairs or to otherwise be responsible for wear and tear of the carpet caused by
such rolling chairs is such wear and tear exceed that caused by normal foot
traffic in surrounding areas. Areas of excessive wear shall be replaced at
Tenant's sole expense upon Lease termination. Tenant hereby waives all rights
under, and benefits of, subsection 1 of Section 1932 and Section 1941 and 1942
of the California Civil Code and under any similar law, statue or ordinance now
or thereafter in effect.
11. UTILITIES.
Tenant shall pay promptly as the same become due, all charges for water,
gas, electricity, telephone, telex and other electronic communications service,
sewer service, waste pick-up and any other utilities, materials or services
furnished directly to or used by Tenant on or about the Premises during the term
of this Lease, including, without limitation, any temporary or permanent utility
surcharge or other exactions whether or not hereinafter imposed.
Landlord shall not be liable for an Tenant shall not be entitled to any
abatement or reduction of rent by reason of any interruption or failure of
utility services to the Premises when such interruption or failure is caused by
accident, breakage, repair, strikes, lockouts, or other labor disturbances or
labor disputes of any nature, or by any other cause, similar or dissimilar,
beyond the reasonable control of Landlord.
12. TAXES.
A. As Additional Rent and in accordance with Paragraph 4 D of this Lease, Tenant
shall pay to Landlord Tenant's proportionate share of all Real Property taxes,
which prorata share shall be allocated to the leased Premises by square footage
or other equitable basis, as calculated by Landlord. The term "Real Property
Taxes", as used herein, shall mean (i) all taxes, assessments, levies and other
charges of any kind or nature whatsoever, general and special, foreseen and
unforeseen (including all installments of principal and interest required to pay
any general or special assessments for public improvements and any increases
resulting from reassessments caused by any change in ownership of the Complex)
now or hereafter imposed by any governmental or quasi-governmental authority or
special district having the direct or indirect power to tax or levy assessments,
which are levied or assessed against, or with respect to the value, occupancy or
use of, all or any portion of the Complex (as now constructed or as may at any
time hereafter be constructed, altered, or otherwise changed) or Landlord's
interest therein; any improvements located within the Complex (regardless of
ownership); the fixtures, equipment and other property of Landlord, real or
personal, that are an integral part of and located in the Complex; or parking
areas, public utilities, or energy within the Complex; (ii) all charges, levies
or fees imposed by reason of environmental regulation or other governmental
control of the Complex; and (iii) all costs and fees (including attorneys' fees)
incurred by Landlord in contesting any Real Property Tax and in negotiating with
public authorities as to any Real Property Tax. If at any time during the term
of this Lease the taxation or assessment of the
9.
<PAGE> 10
Complex prevailing as of the commencement date of this Lease shall be altered to
that in lieu of or in addition to any Real Property Tax described above there
shall be levied, assessed or imposed (whether by reason of a change in the
method of taxation or assessment, creation of a new tax or charge, or any other
cause) an alternate or additional tax or charge (i) on the value of the
occupancy of the Complex or Landlord's interest therein or (ii) on a measured by
the gross receipts, income or rentals from the Complex, or Landlord's business
of leasing the Complex, or computed in any manner with respect to the operation
of the Complex, then any such tax or charge, however designated, shall be
included within the meaning of the term "Real Property Taxes" for purposes of
this Lease. If any Real Property Tax is based upon property or rents unrelated
to the Complex, then only that part of such real Property tax that is fairly
allocable to the Complex shall be included within the meaning of the term "Real
Property Taxes". Notwithstanding the foregoing, the term "Real Property Taxes"
shall not include estate, inheritance, gift or franchise taxes of Landlord or
the federal or state net income tax imposed on Landlord's income from all
sources. The term "Real Estate Taxes" shall also include supplemental taxes
related to the period of Tenant's Lease Term whenever levied, including any such
taxes that may be levied after the Lease Term has expired.
B. TAXES ON TENANT'S PROPERTY
(a) Tenant shall be liable for and shall pay ten (10) days before
delinquency, taxes levied against any personal property or trade fixtures placed
by Tenant in or about in the Premises. If any such taxes on Tenant's personal
property or trade fixtures are levied against Landlord or Landlord's property or
if the assessed value of the Premises is increased by the inclusion therein of a
value placed upon such personal property or trade fixtures of Tenant and if
Landlord, after written notice to Tenant, pays the taxes based on such increased
assessments, which Landlord shall have the right to do regardless of the
validity thereof, but only under proper protest if requested by Tenant. Tenant
shall upon demand, as the case may be, repay to Landlord the taxes so levied
against Landlord, or the proportion of such taxes resulting from such increase
in the assessment; provided that in any such event Tenant shall have the right,
in the name of Landlord and with Landlord's full cooperation, to bring suit in
any court of competent jurisdiction to recover the amount of any such taxes so
paid under protest, and any amount so recovered shall belong to Tenant.
(b) if the Tenant improvements in the Premises, whether installed,
and/or paid for by Landlord or Tenant and whether or not affixed to the real
property so as to become a part thereto, are assessed for real property tax
purposes at a valuation higher than the valuation to which standard office
improvements in other space in the Complex are assessed, then the real property
taxes and assessments levied against Landlord or the Complex by reason of such
excess assessed valuation shall be deemed to be taxes levied against personal
property of Tenant and shall be governed by the provisions of 12B(a) above. If
the records of the County Assessor are available and sufficiently detailed to
serve as a basis for determining whether said Tenant improvements are assessed
at a higher valuation than standard office improvements in other space in the
Complex, such records shall be binding on both the Landlord and the Tenant. If
the records of the County Assessor are not available or sufficiently detailed to
serve as a basis for making said determination, the actual cost of construction
shall be used.
13. LIABILITY INSURANCE.
10.
<PAGE> 11
Tenant, at Tenant's expenses, agrees to keep in force during the term of
this Lease a policy of commercial general liability insurance with a combined
single limit coverage of not less than Two Million Dollars ($2,000,000) per
occurrence for injuries to or death of persons occurring in, on or about the
Premises or the Complex, and property damage insurance with limits of $500,000.
The policy or policies affecting such insurance, certificates of insurance of
which shall be furnished to Landlord, shall name Landlord as additional
insureds, and shall insure any liability of Landlord, contingent or otherwise,
as respects acts or omissions of Tenant, its agents, employees or invitees or
otherwise by any conduct or transaction of any of said persons in or about or
concerning the Premises, including any failure of Tenant to observe or perform
any of its obligations hereunder, shall be issued by an insurance admitted to
transact business in the State of California and shall provide that the
insurance effected thereby shall not be canceled, expect upon thirty (30) days'
prior written notice to Landlord. If, during the term of this Lease, in the
considered opinion of Landlord's Lender, insurance advisor, or counsel, the
amount of insurance described in this paragraph 13 is not adequate, Tenant
agrees to increase said coverage to such reasonable amount as Landlord's Lender,
insurance advisor, or counsel shall deem adequate.
14. TENANT'S PERSONAL PROPERTY INSURANCE AND WORKMAN'S COMPENSATION INSURANCE.
Tenant shall maintain a policy or policies of fire and property damage
insurance in "all risk" form with a sprinkler leakage endorsements insuring the
personal property, inventory, trade fixtures, and leasehold improvements within
the leased Premises for the full replacement value thereof. The proceeds from
any of such pollicies shall be used for the repair or replacement of such items
so insured.
Tenants shall also maintain a policy or policies of workman's
compensation insurance and any other employee benefit insurance sufficient to
comply with all laws.
15. PROPERTY INSURANCE.
Landlord shall purchase and keep in force and as Additional Rent and in
accordance with Paragraph 4D of this Lease, Tenant shall pay to Landlord (or
Landlord's agent if so direct by Landlord) Tenant's proportionate share
(calculated on a square footage or other equitable basis as calculated by
Landlord) of the deductibles on insurance claims and the cost of policy or
policies of insurance covering loss or damage to the Premises and Complex in the
amount of the full replacement value thereof, providing protection against those
perils included within the classification of "all risks" insurance and flood
and/or earthquake insurance, if available, plus a policy of rental income
insurance in the amount of one hundred (100%) percent of twelve (12) months
Basic Rent, plus sums paid as Additional Rent and any deductibles related
thereto. If such insurance costs is increased due to Tenant's use of the
Premises or the Complex. Tenant agrees to pay to Landlord the full cost of such
increase. Tenant shall have no interest in nor any right to the proceeds of any
insurance procured by Landlord for the Complex.
Landlord and Tenant do each hereby respectively release the other, to the extent
of insurance coverage of the releasing party, from any liability for loss or
damage caused by fire or any of the extended coverage casualties included in the
releasing party's insurance policies,
11.
<PAGE> 12
irrespective of the cause of such fire or casualty; provided, however, that if
the insurance policy or either releasing party prohibits such waiver, then this
waiver shall not take effect until consent to such waiver is obtained. If such
waiver is so prohibited, the insured party affected shall promptly notify the
other party thereof.
16. INDEMNIFICATION.
Landlord shall not be liable to Tenant and Tenant hereby waives all
claims against Landlord for any injury to or death of any person or damage to or
destruction of property in or about the Premises or the Complex by or from any
cause whatsoever, including, without limitation, gas, fire, oil, electricity or
leakage of any character from the roof, walls, basement or other portion of the
Premises or the Complex but excluding, however; the willful misconduct or
negligence of Landlord, its agents, servants, employees, invitees, or
contractors of which negligence Landlord has knowledge and reasonable time to
correct. Except as to injury to persons or damage to property to the extent
arising from the willful misconduct or the negligence of Landlord, its agents,
servants, employees, invitees, or contractors, Tenant shall hold Landlord
harmless from and defend Landlord against any and all expenses, including
reasonable attorneys' fees, in connection therewith, arising out of any injury
to or death of any person or damage to or destruction of property occurring in,
on or about the Premises, or any part thereof, from any cause whatsoever.
17. COMPLIANCE.
Tenant, at its sole cost and expense, shall promptly comply with all
laws, statues, ordinances and governmental rules, regulations or requirements
now or hereafter in effect; with the requirements of any board of fire
underwriters or other similar body now or hereafter constituted; and with any
direction or occupancy certificate issued pursuant to law by any public officer;
provided, however, that no such failure shall be deemed a breach of the
provisions if Tenant, immediately upon notification, commences to remedy or
rectify said failure. The judgment of any court of competent jurisdictions or
the admission of Tenant in any action against Tenant, whether Landlord be a
party thereto or not, that Tenant has violated any such law, statute, ordinance
or governmental rule, regulation, requirement, direction or provision, shall be
conclusive of that fact as between Landlord and Tenant. This paragraph shall not
be interpreted as requiring Tenant to make structural changes or improvements,
except to the extent such changes or improvements are required as a result of
Tenant's use of the Premises. Tenant shall, at its sole costs and expense,
comply with any and all requirements pertaining to said Premises, of any
insurance organization or company, necessary for the maintenance of reasonable
fire and public liability insurance covering the Premises.
18. LIENS.
Tenant shall keep the Premises and the Complex free from any liens arising out
of any work performed, materials furnished or obligation incurred by Tenant. In
the event that Tenant shall not, within ten (10) days following the imposition
of such lien, cause the same to be released of record. Landlord shall have, in
addition to all other remedies provided herein and by law, the right, but no
obligation, to cause the same to be released by such means as it shall deem
proper, including payment of the claim giving rise to such lien. All sums paid
by Landlord for
12.
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such purpose, and all expenses incurred by it in connection therewith, shall be
payable to Landlord by Tenant on demand with interest at the prime rate of
interest as quoted by the Bank of America.
19. ASSIGNMENT AND SUBLETTING.
Tenant shall not assign, transfer, or hypothecate the leasehold estate under
this Lease, or any interest therein, and shall not sublet the Premises, or any
part thereof, or any right or privilege appurtenant thereto, or suffer any other
person or entity to occupy or use the Premises, or any portion thereof, without,
in each case, the prior written consent of Landlord which consent will not be
unreasonably withheld. As a condition for granting this consent to any
assignment, transfer, or subletting, Landlord shall require Tenant to pay to
Landlord as Additional Rent, seventy-five (75%) percent of all rents and/or
additional consideration due Tenant from its assignees, transferees or
subtenants in excess of the Rent payable by Tenant to Landlord hereunder for the
assigned, transferred and/or subleased space ("Excess Rent"); provided, however,
that before sharing such Excess Rent, Tenant shall first be entitled to recover
from such Excess Rent the amount of any reasonable leasing commissions related
to said transaction paid by Tenant to third party brokers not affiliated with
Tenant. Tenant shall by thirty (30) days written notice, advise Landlord of its
intent to assign or transfer Tenant's interest in the Lease or sublet the
Premises or any portion thereof for any part of the term hereto. Within
thirty(30) days after receipt of said written notice, Landlord may, in its sole
discretion, elect to terminate this Lease as to the portion of the Premises
described in Tenant's notice on the date specified in Tenant's notice by giving
written notice of such election to termination. If no such notice to terminate
is given to Tenant within said thirty (30) day period, Tenant may proceed to
locate an acceptable sublessee, assignee, or other transferee for presentment to
Landlord for Landlord's approval, all in accordance with the terms, covenants,
and conditions of this paragraph 19. If Tenant intends to sublet the entire
Premises and Landlord elects to terminate this Lease, this Lease shall be
terminated on the date specified in Tenant's notice. If, however, this Lease
shall terminate pursuant to the foregoing with respect to less than all the
Premises, the rest, as defined and reserved hereinabove shall be adjusted on a
pro rata basis to the number of square feet retained by Tenant, and this Lease
as so amended shall continue in full force and effect. In the event Tenant is
allowed to assign, transfer or sublet the whole or any part of the Premises,
with the prior written consent of Landlord, no assignee, transferee or subtenant
shall assign or transfer this Lease, either in whole or in part, or sublet the
whole or any part of the Premises, without also having obtained the prior
written consent of Landlord. A consent of Landlord to one assignment, transfer,
hypothecation, subletting, occupation or use by any other person shall not
release Tenant from any of Tenant's obligations hereunder or be deemed to be a
consent to any subsequent similar or dissimilar assignment, transfer,
hypothecation, subletting, occupation or use by any other person. Any such
assignment, transfer, hypothecation, subletting, occupation or use without such
consent shall be void and shall constitute a breach of the Lease by Tenant and
shall, at the option of Landlord exercised by written notice to Tenant,
terminate this Lease. The leasehold estate under this Lease shall not, nor shall
any interest therein, be assignable for any purpose by operation of law without
the written consent of Landlord. As a condition to its consent, Landlord shall
require Tenant to pay all expenses in connection with the assignment, and
Landlord shall require Tenant's assignee or transferee (or other assignees or
transferees) to assume in writing all of the obligations under this Lease and
for Tenant to remain liable to
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Landlord under the Lease. Notwithstanding the above, in no event will Landlord
consent to a sub-sublease.
20. SUBORDINATION AND MORTGAGES.
In the event Landlord's title or leasehold interests is now or hereafter
encumbered by a deed of trust, upon the interest of Landlord in the land and
buildings in which the demised Premises are located, to secure a loan from a
lender (hereinafter referred to as "Lender") to Landlord, Tenant shall, at the
request of Landlord or Lender, execute in writing an agreement subordinating its
rights under this Lease to the lien of such deed of trust, or, if so requested,
agreeing that the lien of Lender's deed of trust shall be or remain subject and
subordinate to the rights to Tenant under this Lease. Notwithstanding any such
subordination, Tenant's possession under this Lease shall not be disturbed if
Tenant is not in default and so long as Tenant shall pay all rent and observe
and perform all of the provisions set forth in this Lease.
21. ENTRY BY LANDLORD.
Landlord reserves, and shall at all reasonable times after at least 24
hours notice (except in emergencies) have, the right to enter the Premises to
inspect them; to perform any services to be provided by Landlord hereunder, to
submit the Premises to prospective purchasers, mortgagers or tenants; to post
notices of nonresponsibility; and to alter, improve or repair the Premise and
any portion of the Complex, all without abatement of rent; and may erect
scaffolding and other necessary structures in or through the Premises where
reasonably required by the character of the work to be performed; provided,
however, that the business of Tenant shall be interfered with to the least
extent that is reasonably practical. For each of the foregoing purposes,
Landlord shall at all times have and retain a key with which to unlock all of
the doors in an emergency in order to obtain entry to the Premises, and any
entry to the Premises obtained by Landlord by any of said means, or otherwise,
shall not under any circumstances be construed or deemed to be a forcible or
unlawful entry into or a detainer of the Premises or an eviction, actual or
constructive, of Tenant from the Premises or any portion thereof. Landlord shall
also have the right at any time to change the arrangement or location of
entrances or passageways, doors and doorways, and corridors, elevators, stairs,
toilets or other public parts of the Complex and to change the name, number or
designation by which the Complex is commonly known, and none of the foregoing
shall be deemed an actual or constructive eviction of Tenant, or shall entitle
Tenant to any reduction of rent hereunder.
22. BANKRUPTCY AND DEFAULT.
The commencement of a bankruptcy action or liquidation action or
reorganization action or insolvency action or an assignment of or by Tenant for
the benefit of creditors, of any similar action undertaken by Tenant, or the
insolvency of Tenant, shall at Landlord's option, constitute a breach of this
Lease by Tenant. If the trustee or receive appointed to serve during a
bankruptcy, liquidation, reorganization, insolvency or similar action elects to
reject Tenant's unexpired Lease, the trustee or receiver shall notify Landlord
in writing of its election within thirty (30) days after an order for relief in
a liquidation action or within thirty (30) days after the commencement of any
action.
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Within thirty (30) days after court approval of the assumption of this
Lease, the trustee or receiver shall cure (or provide adequate assurance to the
reasonable satisfaction of Landlord that the trustee or receiver shall cure) any
and all previous defaults under the unexpired Lease and shall compensate
Landlord for all actual pecuniary loss and shall provide adequate assurance of
future performance under said Lease to the reasonable satisfaction of Landlord.
Adequate assurance of future performance, as used herein, include, but shall not
be limited to: (i) assurance of source and payment of rent and other
consideration due under this Lease; (ii) assurance that the assumption or
assignment of this Lease will not breach substantially any provisions, such as
radius, location, use, or exclusivity provision, in any agreement relating to
the above described Premises.
Nothing contained in this section shall affect the existing right of
Landlord to refuse to accept an assignment upon commencement of or in connection
with a bankruptcy, liquidation, reorganization or insolvency action or an
assignment of Tenant for the benefit of creditors or other similar act. Nothing
contained in this Lease shall be construed as giving or granting or creating an
equity in the demised Premises to Tenant. In no event shall the leasehold estate
under this Lease, or any interest therein, be assigned by voluntary or
involuntary bankruptcy proceeding without the prior written consent of Landlord.
In no event shall this Lease or any right or privileges hereunder be an asset of
Tenant under any bankruptcy, insolvency or reorganization proceedings.
The failure to perform or honor any covenant, condition or
representation made under this Lease shall constitute a default hereunder by
Tenant upon expiration of the appropriate grace period hereinafter provided.
Tenant shall have a period of five (5) days from the date of written notice from
Landlord within which to cure any default in the payment of rental or adjustment
thereto. Tenant shall have a period of thirty (30) days from the date of written
notice from Landlord within which to cure any other default under this Lease,
provided, however, that if the nature of Tenant's failure is such that more than
thirty (30) days is reasonably required to cure the same, Tenant shall not be in
default so long as Tenant commences performance within such thirty (30) day
period and thereafter prosecutes the same to completion. Upon an uncured default
of this Lease by Tenant, Landlord shall have the following rights and remedies
in addition to any other rights or remedies available to Landlord at law or in
equity:
(a) The rights and remedies provided for by California Civil Code
Section 1951.2, including but not limited to, recovery of the worth at the time
of award of the amount by which the unpaid rent for the balance of the term
after the time of award exceeds the amount of rental loss for the same period
that Tenant proves could be reasonably avoided as computed pursuant to
subsection(b) of said Section 1951.2. Any proof by Tenant under subparagraph (2)
and (3) of Section 1951.2 of the California Civil Code of the amount of rental
loss that could be reasonably avoided shall be made in the following manner.
Landlord and Tenant shall each select a licensed real estate broker in the
business of renting property of the same type and use as the Premises and in the
same geographic vicinity. Such two real estate brokers shall select a third
licensed real estate broker, and the three licensed real estate brokers so
selected shall determine the amount of the rental loss that could be reasonably
avoided from the balance of the term of this Lease after the time of award. The
decision of the majority of said licensed real estate brokers shall be final and
binding upon the parties hereto.
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<PAGE> 16
(b) The right and remedies provided by California Civil Code Section
which allows Landlord to continue the Lease in effect and to enforce all of its
rights and remedies under this Lease, including the right to recover rent as it
becomes due, for so long as Landlord does not terminate Tenant's right to
possession; acts of maintenance or preservation, efforts to relet the Premises,
or the appointment of a receiver upon Landlord's initiative to protect its
interests under this Lease shall not constitute a termination of Tenant's right
to possession.
(c) The right to terminate this Lease by giving notice to Tenant in
accordance with applicable law.
(d) To the extent permitted by law the right of power, to enter the
Premises and remove therefrom all persons and property, to store such property
in a public warehouse or elsewhere at the cost of and for the account of Tenant,
and to sell such property and apply such proceeds therefrom pursuant to
applicable California law. Landlord, may from time to time sublet the Premises
or any part thereof for such term or terms (which may extend beyond the term of
the Lease) and at such rent and such other terms as Landlord in its sole
discretion may deem advisable, with the right to make alterations and repairs to
the Premises. Upon each subletting, (i) Tenant shall be immediately liable to
pay Landlord, in addition to indebtedness other than rent due hereunder, the
cost of such subletting, including, but not limited to, reasonable attorney's
fees and any real estate commissions actually paid, and the cost of such
alteration and repairs incurred by Landlord and the amount, if any, by which the
rent hereunder for the period of such subletting (to the extent such period does
not exceed the term hereof) exceeds the amount to be paid as rent for the
Premises for such period or (ii) at the option of Landlord, rents received from
such subletting shall be applied first to payment of indebtedness other than
rent due hereunder from Tenant to Landlord; second, to the payment of any costs
of such subletting and of such alterations and repairs; third to payment of rent
due and unpaid hereunder, and the residue, if any, shall be held by Landlord and
applied to payment of future rent as the same becomes due hereunder. If Tenant
has been credited with any rent to be received by such subletting under option
(i) and such rent shall not be promptly paid to Landlord by the subtenant(s), or
if such rentals received from such subletting under option (ii) during any month
by less than that to be paid during the month by Tenant hereunder. Tenant shall
pay any such deficiency to Landlord. Such deficiency shall be calculated and
paid monthly. No taking possession of the Premises by Landlord, shall be
construed as an election on its part to terminate this Lease unless a written
notice of such intention be given to Tenant. Notwithstanding any such subletting
without termination, Landlord may at any time hereafter elect to terminate this
Lease for such previous breach.
(e) The right to have a receiver appointed for Tenant upon
application by Landlord, to take possession of the Premises and to apply any
rental collected from the Premises and to exercise all other rights and remedies
granted to Landlord pursuant to subparagraph (d) above.
23. ABANDONMENT.
Tenant shall not vacate or abandon the Premises at any time during the term of
this Lease and if Tenant shall abandon, vacate or surrender the Premises, or be
dispossessed by the process of law, or otherwise, any personal property
belonging to Tenant and left on the Premises shall be
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deemed to be abandoned, at the option of Landlord, except such property as may
be mortgage to Landlord.
24. DESTRUCTION.
In the event the Premises are destroyed in whole or in part form any
cause, except for routine maintenance and repairs and incidental damage and
destruction caused form vandalism and accidents for which Tenant is responsible
for under Paragraph 10, Landlord may, at its option:
(a) Rebuild or restore the Premises to the condition prior to the
damage or destruction; or
(b) Terminate this Lease, (providing that the Premises is damaged to
the extent of 33 1/3% of the replacement cost). If Landlord does not give Tenant
notice in writing within thirty (30) days from the destruction of the Premises
of its election to either rebuild and restore them, or to terminate this Lease,
Landlord shall be deemed to have elected to rebuild or restore them, in which
event Landlord agrees, at its expense, promptly to rebuild or restore the
Premises to their condition prior to the damage or destruction. Tenant shall be
entitled to a reduction in rent while such repair is being made in the
proportion that the area of the Premises rendered untenantable by such damage
bears to the total area of the Premises. If Landlord initially estimates that
the rebuilding or restoration will exceed one hundred eighty (180) days or if
Landlord does not complete the rebuilding or restoration within one hundred
eighty (180) days following the date of destruction (such period of time to be
extended for delays caused by the fault or neglect of Tenant or because of acts
of God, acts of public agencies, labor disputes, strikes, fires, freight
embargoes, rainy or stormy weather, inability to obtain materials, supplies or
fuels, acts of contractors or subcontractors, or delay of the contractors or
subcontractors due to such causes or other contingencies beyond the control of
Landlord), then Tenant shall have the right to terminate this Lease by giving
fifteen (15) days prior written notice to Landlord. Notwithstanding anything
herein to the contrary. Landlord's obligation to rebuild or restore shall be
limited to the building and interior improvements constructed by Landlord as
they existed as of the commencement date of the Lease and shall not include
restoration of Tenant's trade fixtures, equipment, merchandise, or any
improvements, alterations or additions made by Tenant to the Premises, which
Tenant shall forthwith replace or fully repair at Tenant's sole cost and expense
provided this Lease is not cancelled according to the provisions above.
Unless this Lease is terminated pursuant to the foregoing provisions,
this Lease shall remain in full force and effect. Tenant hereby expressly waives
the provisions of Section 1932, Subdivision 2, in Section 1933, Subdivision 4 of
the California Civil Code.
In the event that the building in which the Premises are situated is
damaged or destroyed to the extent of not less than 33 1/8 % of the replacement
cost thereof, Landlord may elect to terminate this Lease, whether the Premises
be injured or not. Notwithstanding anything to the contrary herein, Landlord may
terminate this Lease in the event of an uninsured event or if insurance proceeds
are insufficient to cover one hundred percent of the rebuilding costs net of the
deductible.
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25. EMINENT DOMAIN.
If all or any part of the Premises shall be taken by any public or
quasi-public authority under the power of eminent domain or conveyance in lieu
thereof, this Lease shall terminate as to any portion of the Premises so taken
or conveyed on the date when title vests in the condemnor, and Landlord shall be
entitled to any and all payment, income, rent, award, or any interest therein
whatsoever which may be paid or made in connection with such taking or
conveyance, and Tenant shall have no claim against Landlord or otherwise for the
value of any unexpired term of this Lease. Notwithstanding the foregoing
paragraph, any compensation specifically awarded Tenant for loss of business,
Tenant's personal property, moving cost or loss of goodwill, shall be and remain
the property of Tenant.
If (i) any action or proceeding is commenced for such taking of the
Premises or any part thereof, or if Landlord is advised in writing by any entity
or body having the right or power of condemnation of its intention to condemn
the premises or any portion thereof, or (ii) any of the foregoing events occur
with respect to the taking of any space in the Complex not leased hereby, or if
any spaces so taken or conveyed in lieu of such taking and Landlord shall decide
to discontinue the use and operation of the Complex, or decide to demolish,
alter or rebuild the Complex, then, in any of such events Landlord shall have
the right to terminate this Lease by giving Tenant written notice thereof within
sixty (60) days of the date of receipt of said written advice, or commencement
of said action or proceeding, or taking conveyance, which termination shall take
place as of the first to occur of the last day of the calendar month next
following the month in which such notice is given or the date on which title to
the Premises shall vest in the condemnor.
In the event of such a partial taking or conveyance of the Premises, if
the portion of the Premises taken or conveyed is so substantial that the Tenant
can no longer reasonably conduct its business, Tenant shall have the privilege
of terminating this Lease within sixty (60) days from the date of such taking or
conveyance, upon written notice to Landlord of its intention so to do, and upon
giving of such notice this Lease shall terminate on the last day of the calendar
month next following in which such notice is given, upon payment by Tenant of
the rent form the date of such taking or conveyance to the date of termination.
If a portion of the Premises be taken by condemnation or conveyance in
lieu thereof and neither Landlord nor Tenant shall terminate this Lease as
provided herein, this Lease shall continue in full force and effect as to the
part of the Premises not so taken or conveyed, and the rent herein shall be
apportioned as of the date of such taking or conveyance so that thereafter the
rent to be paid by Tenant shall be in the ratio that the area of the portion of
the Premises not so taken or conveyed bears to the total area of the Premises
prior to such taking.
26. SALE OR CONVEYANCE BY LANDLORD.
In the event of a sale or conveyance of the Complex or any interest therein, by
any owner of the reversion then constituting Landlord, the transferor shall
thereby be released form any further liability upon any of the terms, covenants
or conditions (express or implied) herein contained in favor of Tenant, and in
such event, insofar as such transfer is concerned. Tenant agrees to look solely
to the responsibility of the successor in interest of such transferor in and to
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<PAGE> 19
the Complex and this Lease for all obligations thereafter arising. This Lease
shall not be affected by any such sale or conveyance, and Tenant agrees, upon
recognition, to attorn to the successor in interest of such transferor.
27. ATTORNMENT TO LENDER OR THIRD PARTY.
In the event the interest of Landlord in the land and buildings in which
the leased Premises are located (whether such interest of Landlord is a fee
title interest or a leasehold interest) is encumbered by deed of trust, and such
interest is acquired by the lender or any third party through judicial
foreclosure or by exercise of a power of sale at private trustee's foreclosure
sale. Tenant hereby agrees, upon recognition, to attorn to the purchaser at any
such foreclosure sale and to recognize such purchaser as the Landlord under this
Lease. In the event lien of the deed of trust securing the loan from a Lender to
Landlord is prior and paramount to the Lease, this Lease shall nonetheless
continue in full force and effect for the remainder of the unexpired term
hereof, at the same rental herein reserved and upon all the other terms,
conditions and covenants herein contained.
28. HOLDING OVER.
Any holding over by Tenant after expiration or other termination of the
term of this Lease with the written consent of Landlord delivered to Tenant
shall not constitute a renewal or extension of the Lease or give Tenant any
rights in or to the leased Premises except as expressly provided in this Lease.
Any holding over after the expiration or other termination f the term of this
Lease, with the consent of Landlord, shall be construed to be a tenancy from
month to month, on the same terms and conditions herein specified insofar as
applicable except that the monthly Basic Rent shall be increased to an amount
equal to one hundred fifty (150%) percent of the monthly Basic Rent required
during the last month of the Lease term.
29. CERTIFICATE OF ESTOPPEL.
Tenant shall at any time upon not less than ten (10) days' prior written
notice to Landlord execute, acknowledge and deliver to Landlord a statement in
writing (i) certifying that this Lease is unmodified and in full force and
effect (or, if modified, stating the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect) and the date to
which the rent and other charges are paid in advance, if any, and (ii)
acknowledging that there are not, to Tenant's knowledge, any uncured defaults on
the part of Landlord hereunder, or specifying such defaults, if any, are
claimed. Any such statmeent may be conclusively relied upon by any prospective
purchaser or encumbrancer of the Premises. Tenant's failure to deliver such
statement with in such time shall be conclusive upon Tenant that this Lease is
in full force and effect, without modification except as may be represented by
Landlord; that there are no uncured defaults in Landlord's performance, and that
not more than one month's rent has been paid in advance.
30. CONSTRUCTION CHANGES.
It is understood that the description of the Premises and the location of
ductwork, plumbing and other facilities therein are subject to such minor
changes as Landlord or Landlord's architect determines to be desirable in the
course of construction of the Premises, and
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no such changes, or any changes in plans for any other portions of the Complex
shall affect this Lease or entitle Tenant to any reduction of rent hereunder or
result in any liability of Landlord to Tenant. Landlord does not guarantee the
accuracy of any drawings supplied to Tenant and verification for the accuracy of
such drawings rests with Tenant.
31. RIGHT OF LANDLORD TO PERFORM.
All terms, covenants and conditions of this Lease to be performed or
observed by Tenant shall be performed or observed by Tenant at Tenant's sole
cost and expense and without any reduction of rent. If Tenant shall fail to pay
any sum of money, or other rent, required to be paid by it hereunder and such
failure shall continue for five (5) days after written notice thereof by
Landlord, or shall fail to perform any other term or covenant hereunder on its
part to be performed, and such failure shall continue for thirty (30) days after
written notice thereof by Landlord, Landlord, without waiving or releasing
Tenant from any obligation of Tenant hereunder, may, but shall not be obligated
to, make any such payment or perform any such other term or covenant on Tenant's
part to be performed. All sums so paid by Landlord and all necessary costs of
such performance by Landlord together with interest thereon at the rate of the
prime rate of interest per annum as quoted by the Bank of America from the date
of such payment or performance by Landlord, shall be paid (and Tenant covenants
to make such payment) to Landlord on demand by Landlord, and Landlord shall have
(in addition to any other right or remedy of Landlord) the same rights and
remedies in the event of nonpayment by Tenant as in the case of failure by
Tenant in the payment of rent hereunder. See Paragraph 51.
32. ATTORNEYS' FEES.
A. In the event that either Landlord or Tenant should bring suit for the
possession of the Premises, for the recovery of any sum due under this Lease, or
because of the breach of any provision of this Lease, or for any other relief
against the other party hereunder, then all costs and expenses, including
reasonable attorneys' fees, incurred by the prevailing party therein shall be
paid by the other party, which obligation on the part of the other party shall
be deemed to have accrued on the date of the commencement of such action and
shall be enforceable whether or not the action is prosecuted to judgement.
B. Should Landlord be named as a defendant in any suit brought against
Tenant in connection with or arising out of Tenant's occupancy hereunder, Tenant
shall pay to Landlord its costs and expenses incurred in such suit, including a
reasonable attorney's fee.
33. WAIVER.
The waiver by either party of the other party's failure to perform or
observe any term, covenant or condition herein contained to be performed or
observed by such waiving party shall not be deemed to be a waiver of such term,
covenant or condition or of any subsequent failure of the party failing to
perform or observe the same or any other such term, covenant or condition
therein contained, and no custom or practice which may develop between the
parties hereto during the term hereof shall be deemed a waiver of, or in any way
affect, the right of either party to insist upon performance and observance by
the other party in strict accordance with the terms hereof.
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<PAGE> 21
34. NOTICES.
All notices, demands, requests, advices or designations which may be or
are required to be given by either party to the other hereunder shall be in
writing. All notices, demands, requests, advices or designations by Landlord to
Tenant shall be sufficiently given, made or delivered if personally served on
Tenant by leaving the same at the Premises or if sent by United States certified
or registered mail, postage prepaid, addressed to Tenant at the Premises. All
notices demands, requests, advices or designations by Tenant to Landlord shall
be sent by United States certified or registered mail, postage prepaid,
addressed to Landlord at its offices at Westport Joint Venture, 2560 Mission
College Blvd., #101, Santa Clara, CA 95054. Each notice, request, demand, advice
or designatin referred to in this paragraph shall be deemed received on the date
of the personal service or mailing thereof in the manner herein provided, as the
case may be.
35. EXAMINATION OF LEASE.
Submission of this instrument for examination or signature by Tenant
does not constitute a reservation of or option for a lease, and this instrument
is not effective as a lease or otherwise until its execution and delivery by
both Landlord and Tenant.
36. DEFAULT BY LANDLORD.
Landlord shall not be in default unless Landlord fails to perform
obligations required of Landlord within a reasonable time, but in no event
earlier than thirty (30) days after written notice by Tenant to Landlord and to
the holder of any first mortgage or deed of trust covering the Premises whose
name and address shall have heretofore been furnished to Tenant in writing,
specifying wherein Landlord has failed to perform such obligations; provided,
however, that if the nature of Landlord's obligations is such that more than
thirty (30) days are required for performance, then Landlord shall not be in
default if Landlord commences performance within such thirty (30) day period and
thereafter diligently prosecutes the same to completion.
37. CORPORATE AUTHORITY.
If Tenant is a corporation, (or a partnership) each individual executing
this Lease on behalf of said corporation (or partnership) represents and
warrants that he is duly authorized to execute and deliver this Lease on behalf
of said corporation (or partnership) in accordance with the by-laws of said
corporation (or partnership in accordance with the partnership agreement) and
that this Lease is binding upon said corporation (or partnership) in accordance
with its terms. If Tenant is a corporation, Tenant shall, within thirty (30)
days after execution of this Lease, deliver to Landlord a certified copy of the
resolution of the Board of Directors of said corporation authorizing or
ratifying the execution of this Lease.
38. LIMITATION OF LIABILITY.
In consideration of the benefits accruing hereunder, Tenant and all
successors and assigns covenant and agree that, in the event of any actual or
alleged failure, breach or default hereunder by Landlord:
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A. The sole and exclusive remedy shall be against Landlord's interest
in the Premises leased herein;
B. No partner of Landlord shall be sued or named as a party in any suit
or action (except as may be necessary to secure jurisdiction of the partnership)
C. No service of process shall be made against any partner of Landlord
(except as may be necessary to secure jurisdiction of the partnership)
A. No partner of Landlord shall be required to answer or otherwise
plead to any service of process;
B. No judgment will be taken against any partner of Landlord;
C. Any judgment taken against any partner of Landlord may be vacated
and set aside at any time without hearing;
D. No writ of execution will ever be levied against the assets of any
partner of Landlord;
E. These covenants and agreements are enforceable both by Landlord and
also by any partner of Landlord.
Tenant agrees that each of the foregoing covenants and agreements shall be
applicable to any covenant or agreement either expressly contained in this Lease
or imposed by statute or at common law.
39. MISCELLANEOUS AND GENERAL PROVISIONS.
A. Tenant shall not, without the written consent of Landlord, use the
name of the building for any purpose other than as the address of the business
conducted by Tenant in the Premises.
B. This Lease shall in all respects be governed by and construed in
accordance with the laws of the State of California. If any provision of this
Lease shall be invalid, unenforceable or ineffective for any reason whatsoever,
all other provisions hereof shall be and remain in full force and effect.
C. The term "Premises" includes the space leased hereby and any
improvements now or hereafter installed therein or attached thereto. The term
"Landlord" or any pronoun used in place thereof includes the plural as well as
the singular and the successors and assigns of Landlord. The term "Tenant" or
any pronoun used in place thereof includes the plural as well as the singular
and individuals, firms, associations, partnerships and corporations, and their
and each of their respective heirs, executors, administrators, successors and
permitted assigns, according to the context hereof, and the provisions of this
Lease shall inure to the benefit of and bind such heirs, executors,
administrators, successors and permitted assigns.
The term "person" includes the plural as well as the singular and
individuals, firms, associations, partnerships and corporations. Words used in
any gender include other genders. If
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there be more than one Tenant the obligations of Tenant hereunder are joint and
several. The paragraph headings of this Lease are for convenience of reference
only and shall have no effect upon the construction or interpretation of any
provision here.
D. Time is of the essence of this Lease and of each and all of its
provisions.
E. At the expiration or earlier termination of this Lease, Tenant shall
execute, acknowledge and deliver to Landlord, within ten (10) days after written
demand from Landlord to Tenant, any quitclaim deed or other document required by
any reputable title company, licensed to operate in the State of California, to
remove the cloud or encumbrance created by this Lease from the real property of
which Tenant's Premises are a part.
F. This instrument along with any exhibits and attachments hereto
constitutes the entire agreement between Landlord and Tenant relative to the
Premises and this agreement and the exhibits and attachments may be altered,
amended or revoked only by an instrument in writing signed by both Landlord and
Tenant, Landlord and Tenant agree hereby that all prior or contemporaneous oral
agreements between and among themselves and their agents or representatives
relative to the leasing of the Premises are merged in or revoked by this
agreement.
G. Neither Landlord nor Tenant shall record this Lease or a short form
memorandum hereof without the consent of the other.
H. Tenant further agrees to execute any amendments required by a lender
to enable Landlord to obtain financing, so long as Tenant's rights hereunder are
not substantially affected.
I. Paragraphs 43 through 59 are added hereto and are included as a part
of this lease.
J. Clauses, plats and riders, if any, signed by Landlord and tenant and
endorsed on or affixed to this Lease are a part hereof.
K. Tenant covenants and agrees that no diminution or shutting off of
light, air or view by any structure which may be hereafter erected (whether or
not by Landlord) shall in any way affect his Lease, entitle Tenant to any
reduction of rent hereunder or result in any liability of Landlord to Tenant.
40. BROKERS.
Tenant warrants that it had dealings with only the following real estate
brokers or agents in connection with the negotiation of this Lease: none and
that it knows of no other real estate broker or agent who is entitled to a
commission in connection with this Lease.
41. SIGNS.
No sign, placard, picture, advertisement, name or notice shall be
inscribed, displayed or printed or affixed on or to any part of the outside of
the Premises or any exterior windows of the Premises without the written consent
of Landlord first had and obtained and Landlord shall have the right to remove
any such sign, placard, picture, advertisement, name or notice without notice
23.
<PAGE> 24
to and at the expense of Tenant. If Tenant is allowed to print or affix or in
any way place a sign in, on, or about the Premises, upon expiration or other
sooner termination of this Lease, Tenant at Tenant's sole cost and expense shall
both remove such sign and repair all damage in such a manner as to restore all
aspects of the appearance of the Premises to the condition prior to the
placement of said sign.
All approved signs or lettering on outside doors shall be printed,
painted, affixed or inscribed at the expense of Tenant by a person approved of
by Landlord. Tenant shall not place anything or allow anything to be placed near
the glass of any window, door partition or wall which may appear unsightly from
outside the Premises.
IN WITNESS WHEREOF, Landlord and Tenant have executed and delivered this
Lease as of the day and year last written below.
<TABLE>
<S> <C>
LANDLORD: TENANT:
WESTPORT JOINT VENTURE IPASS, INC.,
a California joint venture a California corporation
JOHN ARRILLAGA SURVIVOR'S TRUST
By /s/ John Arrillaga By /s/ Michael Mansouri
---------------------------------------------------- ------------------------------------
John Arrillaga, Trustee
Date 11/24/99 Title Chairman & CEO
------------------------------------------------- ----------------------------------
PEERY PRIVATE INVESTMENT COMPANY WP, L.P.,
a California limited partnership Print or Type Name Michael Mansouri
---------------------
By /s/ Richard Perry Date 11/21/99
-------------------------------------------------- -----------------------------------
Richard T. Peery, Trustee of the Richard T. Peery
Separate Property Trust dated 7/20/77, as its
General Partner
Date 11/24/99
------------------------------------------------
PEERY PUBLIC INVESTMENT COMPANY - WP, L.P.,
a California limited partnership
By: /s/ Richard Perry
-------------------------------------------------
Richard T. Peery, Trustee of the Richard T. Peery
Separate Property Trust dated 7/20/77, as its
General Partner
Date 11/24/99
------------------------------------------------
</TABLE>
24.
<PAGE> 25
Paragraphs 43 through 59 to Lease Agreement dated October 26, 1999, by and
between Westport Joint Venture, a California joint venture, as Landlord, and
iPass, Inc., a California corporation, as Tenant for 48,384+/- Square Feet of
Space Located at 3800 Bridge Parkway, Redwood City, California.
42. BASIC RENT.
In accordance with Paragraph 4A herein, the total aggregate sum of
TWENTY-FIVE MILLION NINE HUNDRED SEVENTY NINE THOUSAND SEVEN HUNDRED FIVE AND
38/100 DOLLARS ($25,979,705.38), shall be payable as follows:
On January 15, 2000, the sum of ONE HUNDRED SIX THOUSAND THREE HUNDRED
SIXTY ONE AND 38/100 DOLLARS ($106,361.30) shall be due, representing the
prorated Basic Rent for the period of January 15, 200 through January 31, 2000.
On February 1, 2000, the sum of ONE HUNDRED EIGHTY-ONE THOUSAND FOUR
HUNDRED FORTY AND NO/100 DOLLARS ($181,440.00) shall be due, and a like sum due
on the first day of each month thereafter, through and including February 1,
2001.
On March 1, 2001, the sum of ONE HUNDRED EIGHTY-EIGHT THOUSAND SIX HUNDRED
NINETY-SEVEN AND 60/100 DOLLARS ($188,697.60) shall be due, and a like sum due
on the first day of each month thereafter, through and including February 1,
2002.
On March 1, 2002, the sum of ONE HUNDRED NINETY-FIVE THOUSAND NINE HUNDRED
FIFTY-FIVE AND 20/100 DOLLARS ($195,955.20) shall be due, and a like sum due on
the first day of each month thereafter, through and including February 1, 2003.
On March 1, 2003, the sum of TWO HUNDRED THREE THOUSAND TWO HUNDRED TWELVE
AND 80/100 DOLLARS ($203,212.80) shall be due, and a like sum due on the first
day of each month thereafter, through and including February 1, 2004.
On March 1, 2004, the sum of TWO HUNDRED TEN THOUSAND FOUR HUNDRED SEVENTY
AND 40/100 DOLLARS ($210,470.40) shall be due, and a like sum due on the first
day of each month thereafter, through and including February 1, 2005.
On March 1, 2005, the sum of TWO HUNDRED SEVENTEEN THOUSAND SEVEN HUNDRED
TWENTY-EIGHT AND NO/100 DOLLARS ($217,728.00) shall be due, and a like sum due
on the first day of each month thereafter, through and including February 1,
2006.
On March 1, 2006, the sum of TWO HUNDRED TWENTY-FOUR THOUSAND NINE HUNDRED
EIGHTY-FIVE AND 60/100 DOLLARS ($224,985.60) shall be due, and a like sum due on
the first day of each month thereafter, through and including February 1, 2007.
On March 1, 2007, the sum of TWO HUNDRED THIRTY-TWO THOUSAND TWO HUNDRED
FORTY-THREE AND 20/100 DOLLARS ($232,243.20) shall be due, and a like sum due on
the first day of each month thereafter, through and including February 1, 2008.
25.
<PAGE> 26
On March 1, 2008, the sum of TWO HUNDRED THIRTY-NINE THOUSAND FIVE HUNDRED
AND 80/100 DOLLARS ($239,500.80) shall be due, and a like sum due on the first
day of each month thereafter, through and including February 1, 2009.
On March 1, 2009, the sum of TWO HUNDRED FORTY-SIX THOUSAND SEVEN HUNDRED
FIFTY-EIGHT AND 40/100 DOLLARS ($246,258.40) shall be due, and a like sum due on
the first day of each month thereafter, through and including February 1, 2010;
or until the entire aggregate sum of TWENTY-FIVE MILLION NINE HUNDRED
SEVENTY-NINE THOUSAND SEVEN HUNDRED FIVE AND 38/100 DOLLARS ($25,979,705.38) has
been paid.
43. "AS-IS BASIS.
Subject only to Paragraph 45 and to Landlord making the improvements shown
on EXHIBIT B to be attached hereto, it is hereby agreed that the Premises leased
hereunder is leased strictly on an "as-is" basis and in its present condition,
and in the configuration as shown on EXHIBIT B to be attached hereto, and by
reference made a part hereof. Except as noted herein, it is specifically agreed
between the parties that after Landlord makes the interior improvements as shown
on EXHIBIT B, Landlord shall not be required to make, nor be responsible for any
cost, in connection with any repair, restoration, and/or improvement to the
Premises in order for this Lease to commence, or thereafter, throughout the Term
of this Lease. Notwithstanding anything to the contrary within this Lease,
Landlord makes no warranty or representation of any kind or nature whatsoever as
to the condition or repair of the Premises, nor as to the use or occupancy which
may be made thereof.
44. TENANT INTERIOR IMPROVEMENTS.
Landlord shall, at its sole cost and expense, construct certain interior
improvements (the "Tenant Improvements") in the Premises, as shown on EXHIBIT B
to be attached to the Lease and Landlord agrees to deliver the Premises leased
hereunder to Tenant, at Landlord's expense, in the configuration shown in Red on
EXHIBIT B to be attached hereto. Notwithstanding anything to the contrary above,
it is specifically understood and agreed that Landlord shall be required to
furnish only a standard air conditioning/heating system, normal electrical
outlets, standard fire sprinkler systems, standard bathroom, standard lobby, 2'
x 4' suspended acoustical tile drop ceiling throughout the entire space leased,
carpeting and/or vinyl-coated floor tile, and standard office partitions and
doors, as shown on EXHIBIT B to be attached hereto; provided, however, that any
special HVAC and/or plumbing and/or electrical requirements over and above that
normally supplied by Landlord shall be 100 percent the responsibility of and be
paid for 100 percent by Tenant.
It is further agreed that Tenant shall furnish Landlord with Tenant's
required specifications and a preliminary space plan showing the layout of the
improvements to be constructed in the Premises by November 15, 1999. At that
time, Landlord shall have the final interior plans drawn by Landlord's
architect. All of the plans and specifications shall be EXHIBIT B to this Lease.
If said preliminary plans and specifications for any items affecting the
interior improvements to be constructed in the building are not received by
Landlord for Landlord's approval (which approval shall not be unreasonably
withheld) by November 15, 1999, then it is
26.
<PAGE> 27
agreed that, notwithstanding anything to the contrary in this Lease, this Lease
and Tenant's obligation to perform all terms, covenants and conditions of this
Lease shall commence February 15, 2000, regardless of whether or not the
building and interior improvements are completed on February 15, 2000, and
Landlord shall complete construction of the interior improvements as soon as
reasonably possible thereafter.
Notwithstanding anything to the contrary, it is agreed that in the event
Tenant makes changes, additions or modifications to the plans and specifications
to be constructed by Landlord as set forth herein, or improvements are installed
for Tenant in excess of those to be provided Tenant by Landlord as set forth on
EXHIBIT B, any increased cost(s) resulting from said changes, additions and/or
modifications and/or improvements in excess of those to be provided Tenant shall
be contracted for with Landlord and paid for one hundred percent (100%) by
Tenant.
The interior shall be constructed in accordance with EXHIBIT B of the
Lease, it being agreed, however, that if the interior improvements constructed
by Landlord relating thereto, do not conform exactly to the plans and
specifications as set forth in the Lease, and the general appearance, structural
integrity, and Tenant's uses and occupancy of the Premises and interior
improvements relating thereto are not materially or unreasonably affected by
such deviation, it is agreed that the commencement date of the Lease, and
Tenant's obligation to pay rental, shall not be affected, and Tenant hereby
agrees, in such event, to accept the Premises and interior improvements as
constructed by Landlord.
Tenant shall have thirty (30) days after the Commencement Date to provide
Landlord with a "punch list" pertaining to Landlord's work with respect to
Tenant's interior improvements. As soon as reasonably possible thereafter,
Landlord, or one of Landlord's representatives (if so approved by Landlord), and
Tenant shall conduct a joint walk-through of the Premises (if Landlord so
requires), and inspect such Tenant Improvements, using their best efforts to
agree on the incomplete or defective construction related to the Tenant
Improvements installed by Landlord. After such inspection has been completed,
Landlord shall prepare, and both parties shall sign, a list of all "punch list"
items which the parties reasonably agree are to be corrected by landlord (but
which shall exclude any damage or defects caused by Tenant, its employees,
agents or parties Tenant has contracted with to work on the Premises). landlord
shall have thirty (30) days thereafter (or longer if necessary, provided
Landlord is diligently pursuing the completion of the same) to complete, at
Landlord's expense, the repairs on the "punch list" without the Commencement
Date of the Lease and Tenant's obligation to pay Rental thereunder being
affected. This Paragraph shall be of no force and effect if Tenant shall fail to
give any such notice to Landlord within thirty (30) days after the Commencement
Date of this Lease.
45. CONSENT.
Whenever the consent of one party to the other is required hereunder, such
consent shall not be unreasonably withheld.
46. CHOICE OF LAW; SEVERABILITY.
This Lease shall in all respects be governed by and construed in
accordance with the laws of the State of California. If any provisions of this
Lease shall be invalid, unenforceable or
27.
<PAGE> 28
ineffective for any reason whatsoever, all other provisions hereof shall be and
remain in full force and effect.
47. AUTHORITY TO EXECUTE.
The parties executing this Lease Agreement hereby warrant and represent
that they are properly authorized to execute this Lease Agreement and bind the
parties on behalf of whom they execute this Lease Agreement and to all of the
terms, covenants and conditions of this Lease Agreement as they relate to the
respective parties hereto.
48. ASSESSMENT CREDITS.
The demised property herein may be subject to a special assessment levied
by the City of Redwood City as part of an Improvement District. As a part of
said special assessment proceedings (if any), additional bonds were or may be
sold and assessments were or may be levied to provide for construction
contingencies and reserve funds. Interest shall be earned on such funds created
for contingencies and on reserve funds which will be credited for the benefit of
said assessment district. To the extent surpluses are created in said district
through unused contingency funds, interest earnings or reserve funds, such
surpluses shall be deemed the property of Landlord. Notwithstanding that such
surpluses may be credited on assessments otherwise due against the Leased
Premises, Tenant shall pay to Landlord, as additional rent if, and at the time
of any such credit of surpluses, an amount equal to all such surpluses so
credited. For example: if (i) the property is subject to an annual assessment of
$1,000.00, and (ii) a surplus of $200.00 is credited towards the current year's
assessment which reduces the assessment amount shown on the property tax bill
from $1,000.00 to $800.00, Tenant shall, upon receipt of notice from Landlord,
pay to Landlord said $200.00 credit as Additional Rent.
49. ASSIGNMENT AND SUBLETTING (CONTINUED).
A. In addition to and notwithstanding anything to the contrary in
Paragraph 19 of this Lease and provided Tenant is not in default of this Lease,
Landlord hereby agrees to consent to: (1) Tenant's assigning or subletting said
Lease to: (i) any parent or subsidiary corporation, or corporation with which
Tenant merges or consolidates provided that the net worth of said parent or
subsidiary corporation, or said corporation has a net worth equal to or greater
than the net worth of Tenant (a) at the time of Lease execution or (b) at the
time of such assignment, merger, or consolidation (whichever is greater); or
(ii) any third party or entity to whom Tenant sells all or substantially all of
its assets; provided, that the net worth of the resulting or acquiring
corporation has a net worth after the merger, consolidation or acquisition equal
to or greater than the net worth of Tenant (a) at the time of Lease execution or
(b) at the time of such merger, consolidation or acquisition, whichever is
greater (collectively "Permitted Transfers"); (2) waive its right to terminate
the Lease due to a Permitted Transfer; and (3) waive any rights to Excess Rent
related to a Permitted Transfer. No such assignment or subletting will release
the Tenant from its liability and responsibility under this Lease to the extend
Tenant continues in existence following such transaction. Notwithstanding the
above, Tenant shall be required to (a) give Landlord written notice prior to
such assignment or subletting to any party as described in (i) and (ii) above,
(b) execute Landlord's consent document prepared by Landlord reflecting the
28.
<PAGE> 29
assignment or subletting and (c) pay Landlord's costs for processing said
Consent prior to the effective date of said assignment or sublease.
B. Notwithstanding the foregoing, Landlord and Tenant agree that it
shall not be unreasonable for Landlord to refuse to consent to a proposed
assignment, sublease or other transfer ("Proposed Transfer") if the Premises or
any other portion of the Property would become subject to additional or
different Government Requirements as a direct or indirect consequence of the
Proposed Transfer and/or the Proposed Transferee's use and occupancy of the
Premises and the Property. However, Landlord may, in its sole discretion,
consent to such a proposed Transfer where Landlord is indemnified by Tenant and
(i) Subtenant or (ii) Assignee, in form and substance satisfactory to Landlord's
counsel, by Tenant and/or the Proposed Transferee from and against any and all
costs, expenses, obligations and liability arising out of the Proposed Transfer
and/or the Proposed Transferee's use and occupancy of the premises and the
Property.
C. Any and all sublease agreement(s) between Tenant and any and all
subtenant(s) (which agreements must be consent to by Landlord, pursuant to the
requirements of this Lease) shall contain the following language:
"If Landlord and Tenant jointly and voluntarily elect, for any
reason whatsoever, to terminate the Master Lease prior to the scheduled
Master Lease termination date, then this Sublease (if then still in
effect) shall terminate concurrently with the termination of the Master
Lease. Subtenant expressly acknowledges and agrees that (1) the voluntary
termination of the Master Lease by Landlord and Tenant and the resulting
termination of this Sublease shall not give Subtenant any right or power
to make any legal or equitable claim against Landlord, including without
limitation any claim for interference with contract or interference with
prospective economic advantage, and (2) Subtenant hereby waives any and
all rights it may have under law or at equity against Landlord to
challenge such an early termination of the Sublease, and unconditionally
releases and relieves Landlord, and its officers, directors, employees and
agents, from any and all claims, demands, and/or causes of action
whatsoever (collectively, "Claims"), whether such matters are known or
unknown, latent or apparent, suspected or unsuspected, foreseeable or
unforeseeable, which Subtenant may have arising out of or in connection
with any such early termination of this Sublease. Subtenant knowingly and
intentionally waives any and all protection which is or may be given by
Section 1542 of the California Civil Code which provides as follows: "A
general release does not extend to claims which the creditor does not know
or suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement with
debtor.
The term of this Sublease is therefore subject to early termination.
Subtenant's initials here below evidence (a) Subtenant's consideration of
and agreement to this early termination provision, (b) Subtenant's
acknowledgment that, in determining the net benefits to be derived by
Subtenant under the terms of this Sublease, Subtenant has anticipated the
potential for early termination, and (c) Subtenant's agreement to the
general waiver and release of Claims above.
29.
<PAGE> 30
Initials: Initials: "
---------------------- --------------------
Subtenant Tenant
50. BANKRUPTCY AND DEFAULT.
Paragraph 22 is modified to provide that with respect to non-monetary
defaults not involving Tenant's failure to pay Basic Rent or Additional Rent,
Tenant shall not be in default of any non-monetary obligation if (i) more than
thirty (30) days is required to cure such non-monetary default, and (ii) Tenant
commences cure of such default as soon as reasonably practicable after receiving
written notice of such default from Landlord and thereafter continuously and
with due diligence prosecutes such cure to completion.
51. ABANDONMENT.
Paragraph 23 is modified to provide that Tenant shall not be in default
under the Lease if it leaves all or any part of Premises vacant so long as (i)
tenant is performing all of its other obligations under the Lease including the
obligation to pay Basic Rent and Additional Rent (ii) Tenant provides on-site
security during normal business hours for those parts of the Premises left
vacant, (iii) such vacancy does not materially and adversely affect the validity
or coverage of any policy of insurance carried by Landlord with respect to the
Premises, and (iv) the utilities and heating and ventilation system are operated
and maintained to the extent necessary to prevent damage to the Premises or its
systems.
52. HAZARDOUS MATERIALS.
Landlord and Tenant agree as follows with respect to the existence or use
of "Hazardous Materials" (as defined herein) on, in, under or about the Premises
and real property located beneath said Premises and the common areas of the
Complex (hereinafter collectively referred to as the "Property"):
A. As used herein, the term "Hazardous Materials," shall mean any
material, waste, chemical, mixture or byproduct which is or hereafter is
defined, listed or designated under Environmental Laws (defined below) as a
pollutant, or as a contaminant, or as a toxic or hazardous substance, waste or
material, or any other unwholesome, hazardous, toxic, biohazardous or
radioactive material, waste, chemical, mixture or byproduct or which is listed,
regulated or restricted by any Environmental Law (including, without limitation,
petroleum hydrocarbons or any distillates or derivatives or fractions thereof,
polychlorinated biphenyls or asbestos). As used herein, the term "Environmental
Laws" shall mean any applicable Federal, State of California or local government
law (including common law), statute, regulation, rule, ordinance, permit,
license, order, requirement, agreement or approval, or any determination,
judgment, directive or order of any executive or judicial authority at any level
of Federal, State of California or local government (whether now existing or
subsequently or promulgated) relating to pollution or the protection of the
environment, ecology, natural resources or public health and safety.
B. Tenant shall obtain Landlord's written consent, which may be
withheld in Landlord's discretion, prior to the occurrence of any Tenant's
Hazardous Materials Activities (defined below); provided, however, that
Landlord's consent shall not be required for normal use in
30.
<PAGE> 31
compliance with applicable Environmental Laws of customary household and office
supplies (Tenant shall first provide Landlord with a list of said materials
use), such as mild cleaners, lubricants and copier toner. As used herein, the
term "Tenant's Hazardous Materials Activities" shall mean any and all use,
handling, generation, storage, disposal, treatment, transportation, release,
discharge or emission of any Hazardous Materials on, in, beneath, to, from, at
or about the Property, in connection with Tenant's use of the Property, or by
Tenant or by any of Tenant's agents, employees, contractors, vendors, invitees,
visitors or its future subtenants or assignees. Tenant agrees that any and all
Tenant's Hazardous Materials Activities shall be conducted in strict, full
compliance with applicable Environmental Laws at Tenant's expense, and shall not
result in any contamination of the Property or the environment. Tenant agrees to
provide Landlord with prompt written notice of any spill or release of Hazardous
Materials at the Property during the term of the Lease of which Tenant becomes
aware, and further agrees to provide Landlord with prompt written notice of any
violation of Environmental Laws in connection with Tenant's Hazardous Materials
Activities of which Tenant becomes aware. If Tenant's Hazardous Materials
Activities involve Hazardous Materials other than normal use of customary
household and office supplies, Tenant also agrees at Tenant's expense: (i) to
install such Hazardous Materials monitoring, storage and containment devices as
Landlord reasonably deems necessary (Landlord shall have no obligation to
evaluate the need for any such installation or to require any such
installation); (ii) provide Landlord with a written inventory of such Hazardous
Materials, including an update of same each year upon the anniversary date of
the Commencement Date of the Lease ("Anniversary Date"); and (iii) on each
Anniversary Date, to retain a qualified environmental consultant, acceptable to
Landlord, to evaluate whether Tenant is in compliance with all applicable
Environmental Laws with respect to Tenant's Hazardous Materials Activities.
Tenant, at its expense, shall submit to Landlord a report from such
environmental consultant which discusses the environmental consultant's findings
within two (2) months of each Anniversary Date. Tenant, at its expense, shall
promptly undertake and complete any and all steps necessary, and in full
compliance with applicable Environmental Laws, to fully correct any and all
problems or deficiencies in connection with Tenant's Hazardous Materials
Activities identified by the environmental consultant, and promptly provide
Landlord with documentation of all such corrections.
C. Prior to termination or expiration of the Lease, Tenant, at its
expense, shall (i) properly remove from the Property all Hazardous Materials
which come to be located at the Property in connection with Tenant's Hazardous
Materials Activities, and (ii) fully comply with and complete all facility
closure requirements of applicable Environmental Laws regarding Tenant's
Hazardous Materials Activities, including but not limited to (x) properly
restoring and repairing the Property to the extent damaged by such closure
activities, and (y) obtaining from the local Fire Department or other
appropriate governmental authority with jurisdiction a written concurrence that
closure has been completed in compliance with applicable Environmental Laws.
Tenant shall promptly provide Landlord with copies of any claims, notices, work
plans, data and reports prepared, received or submitted in connection with any
such closure activities.
D. If Landlord, in its sole discretion, believes that the Property has
become contaminated as a result of Tenant's Hazardous Materials Activities,
Landlord in addition to any other rights it may have under this Lease or under
Environmental Laws or other laws, may enter upon the Property and conduct
inspection, sampling and analysis, including but not limited to, obtaining and
analyzing samples of soil and groundwater, for the purpose of determining the
nature and
31.
<PAGE> 32
extent of such contamination. Tenant shall promptly reimburse Landlord for the
costs of such an investigation, including but not limited to, reasonable
attorneys' fees Landlord incurs with respect to such investigation, that
discloses Hazardous Materials contamination for which Tenant is liable under
this Lease. Except as may be required of Tenant by applicable Environmental
Laws, Tenant shall not perform any sampling, testing or drilling to identify the
presence of any Hazardous Materials at the Property, without Landlord's prior
written consent which may be withheld in Landlord's discretion. Tenant shall
promptly provide Landlord with copies of any claims, notices, work plans, data
and reports prepared, received or submitted in connection with any sampling,
testing or drilling performed pursuant to the preceding sentence.
E. Tenant shall indemnify, defend (with legal counsel acceptable to
Landlord, whose consent shall not unreasonably be withheld) and hold harmless
Landlord, its employees, assigns, successors, successors-in-interest, agents and
representatives from and against any and all claims (including but not limited
to third party claims from a private party or a government authority),
liabilities, obligations, losses, causes of action, demands, governmental
proceedings or directives, fines, penalties, expenses, costs (including but not
limited to reasonable attorneys', consultants' and other experts' fees and
costs), and damages, which arise from or relate to: (i) Tenant's Hazardous
Materials Activities; (ii) any Hazardous Materials contamination caused by
Tenant prior to the Commencement Date of the Lease; or (iii) the breach of any
obligation of Tenant under this Paragraph 53 (collectively, "Tenant's
Environmental Indemnification"). Tenant's Environmental Indemnification shall
include but is not limited to the obligation to promptly and fully reimburse
Landlord for losses in or reductions to rental income, and diminution in fair
market value of the Property. Tenant's Environmental Indemnification shall
further include but is not limited to the obligation to diligently and properly
implement to completion, at Tenant's expense, any and all environmental
investigation, removal, remediation, monitoring, reporting, closure activities
or other environmental response action (collectively, "Response Actions").
Tenant shall promptly provide Landlord with copies of any claims, notices, work
plans, data and reports prepared, received or submitted in connection with any
Response Actions.
F. Landlord hereby informs Tenant, and Tenant hereby acknowledges, that
the Premises and adjacent properties overlie a former solid waste landfill site
commonly known as the Westport Landfill ("Former Landfill"). Landlord further
informs Tenant, and Tenant hereby acknowledges, that (i) prior testing has
detected the presence of low levels of certain volatile and semi-volatile
organic compounds and other contaminants in the groundwater, in the leachate
from the landfilled sold waste, and/or in certain surface waters of the
Property, as more fully described in Section 2.3.2 of the report entitled
"Revised Discharge Monitoring Plan, Westport Landfill Site, Redwood City,
California," prepared by Geomatrix Consultants, dated May 1996 ("Discharge
Plan"), (ii) methane gas is or may be generated by the landfilled solid waste
(item "i" immediately preceding and this item "ii" are hereafter collectively
referred to as the "Landfill Contamination"), and (iii) the Premises and the
Former Landfill are subject to the California Regional Water Quality Control
Board's ("Regional Board") Waste Discharge Requirements Order No. 94-181 (the
"Order"). The Order is attached hereto as EXHIBIT C. As evidenced by their
initials set forth immediately below, Tenant acknowledges that Landlord has
provided Tenant with copies of the environmental reports listed on EXHIBIT D,
and Tenant acknowledges that Tenant and Tenant's experts (if any) have had ample
opportunity to review such reports and
32.
<PAGE> 33
that Tenant has satisfied itself as to the environmental conditions of the
Property and the suitability of such conditions for Tenant's intended use of the
Property.
Initials: /s/ MM Initials: /s/ JA
---------------------------- --------------------
Tenant Landlord
G. Landlord shall indemnify, defend and hold harmless Tenant against
any and all claims asserted by third parties (excluding any agents, employees,
contractors, vendors, invitees, visitors, future subtenants and assignees of
Tenant, and excluding any other parties related to Tenant), including all
liabilities, judgments, damages, suits, orders, government directives, costs and
expenses in connection with such claims, which arise from (i) the Landfill
Contamination, or (ii) the Order, as may be amended ("Landlord's Environmental
Indemnity"); provided, however, that Landlord's Environmental Indemnity shall be
subject to the following limitations and conditions:
(a) Landlord's Environmental Indemnity shall not apply to any
economic or consequential damages suffered by Tenant, including but not limited
to loss of business or profits.
(b) Landlord's Environmental Indemnity shall not apply, without
limitation, to any releases caused by Tenant's Hazardous Materials Activities.
(c) Tenant acknowledges that Landlord must comply with the Order,
as may be amended, and with directives of government authorities including the
Regional Board, with respect to the Contamination and the Former Landfill.
Tenant further acknowledges that groundwater monitoring wells, methane recovery
wells and equipment, and other environmental control devices are located on and
about the Premises and may be modified or added to during the term of the Lease
(collectively, "Environmental Equipment"), and that environmental investigation,
monitoring, closure and post-closure activities (collectively, "Environmental
Activities") will be performed on the Premises during the term of the Lease.
Tenant shall allow Landlord, and any other party named as a discharger under the
Order, as may be amended, and their respective agents, consultants and
contractors, and agents of governmental environmental authorities with
jurisdiction ("Government Representatives") to enter the Premises to access the
Environmental Equipment and to perform Environmental Activities during the term
of the Lease, provided that Tenant's use and occupancy of the Premises shall not
unreasonably be disturbed.
(d) Tenant and Landlord shall reasonably cooperate with each other
regarding any Environmental Activities to be performed, and regarding any
Environmental Equipment to be installed, maintained, or removed on the Premises
during the term of the Lease.
(e) Tenant shall be responsible at its expense for repairing any
Environmental Equipment damages due to the negligence of Tenant or Tenant's
agents, employees, contractors, vendors, invitees, visitors, future subtenants
or assignees (such terms "invitees" and "visitors" as used in this Paragraph 53
shall not include Landlord or any other party named as a discharger under the
Order as may be amended, or any of their respective agents, consultants or
contractors, or any Government Representatives).
33.
<PAGE> 34
It is agreed that the Tenant's responsibilities related to Hazardous
Materials will survive the expiration or termination of this Lease and that
Landlord may obtain specific performance of Tenant's responsibilities under this
Paragraph 53.
53. LEASE TERMS CO-TERMINOUS.
It is acknowledged that (i) concurrently with the execution of this Lease,
Landlord and Tenant are also executing a second Lease Agreement dated October
26, 1999 (hereinafter referred to as the "Building 19 Lease") affecting adjacent
property located at 3600 Bridge Parkway, Redwood City and (ii) it is the
intention of the parties that the term of this Lease be co-terminous with the
term of the Building 19 Lease such that the terms of both leases expire on the
same date; provided, however, the termination of this Lease resulting from the
terms and conditions stated under Paragraph 19 "Bankruptcy and Default" (subject
to Landlord's option as stated in the respective leases' "Cross Default"
Paragraph) or Paragraph 21 "Destruction" or Paragraph 22 "Eminent Domain" shall
not result in a termination of the Building 19 Lease, unless Landlord elects, at
its sole and absolute discretion, to terminate both of the leases.
54. CROSS DEFAULT.
As a material part of the consideration for the execution of this Lease by
Landlord, it is agreed between Landlord and Tenant that a default under this
Lease, or a default under said Building 19 Lease may, at the option of Landlord,
be considered a default under both leases, in which event Landlord shall be
entitled (but in no event required) to apply all rights and remedies of Landlord
under the terms of one lease to both leases including, but not limited to, the
right to terminate one or both of said leases by reason of a default under said
Building 19 Lease or hereunder.
55. ADDITIONAL RENT CONTINUED.
The following items shall be excluded from "Additional Rent":
A. Leasing commissions, attorney's fees, costs, disbursements, and
other expenses incurred in connection with negotiations with other tenants, or
disputes between Landlord and other third party not related to Tenant
(hereinafter referred to as "Third Party"), or in connection with marketing,
leasing, renovating, or improving space for other current or prospective tenants
or other current or prospective occupants of the Complex; notwithstanding
anything to the contrary herein, any costs and expenses Landlord is entitled to
be reimbursed for as stated under Paragraph 22 ("Bankruptcy and Default") ARE
NOT excluded Additional Rent items as reflected in this Paragraph 56.
B. The cost of any service sold to any other Third Party or other
occupant whose leased premises are not part of the Premises leased herein and
for which Landlord is entitled to be reimbursed as an additional charge or
rental over and above the basic rent and additional rent payable under the lease
agreement with said other tenant.
C. Any costs, fines, or penalties incurred due to violations by
Landlord of any governmental rule or authority, provided Tenant is not
responsible under the Lease for such
34.
<PAGE> 35
costs, fines and/or penalties, and/or provided Tenant's actions or inactions did
not cause, in whole or in part, such costs, fines and/or penalties.
D. Wages, salaries, or other compensation paid to executive employees
above the grade of Property Manager.
E. Repairs or other work occasioned by fire, windstorm, or other
insured peril, to the extent that Landlord shall receive proceeds of such
insurance or would have received such proceeds had Landlord maintained the
insurance coverage required under this Lease providing said insurance coverage
was available and Tenant paid its share of the premium as required under the
Lease and any insurance deductible(s) which Tenant is responsible for paying and
provided Tenant is not responsible for the damage to the Premises.
F. Except as otherwise noted in this Lease, any mortgage debt, or
ground rents or any other amounts payable under any ground lease for the
Property.
G. Subject to the terms of Paragraph 53G above, Landlord's costs
related to Lease Paragraphs 53F and 53G.
56. SECURITY DEPOSIT IN THE FORM OF AN IRREVOCABLE STANDBY LETTER OF CREDIT.
The cash Security Deposit provided for in Paragraph 4G of the Lease shall
be deposited by Tenant with Landlord upon execution of this Lease; however,
Tenant shall have the right, at Tenant's sole election, to replace one-half
($246,758.40) of the cash Security Deposit held by Landlord with an irrevocable
letter of credit, drawn upon an institutional lender reasonably acceptable and
accessible to Landlord in form and content reasonably satisfactory to Landlord
and for a term equal to the Term of this Lease plus a period of sixty (60) days,
and said irrevocable letter of credit shall not be subject to annual renewal.
Said financial institution must agree that the presentment for demand may be
made in San Jose, Santa Clara or Palo Alto, California. One half of the cash
Security Deposit ($246,758.40) held by Landlord shall be refunded to Tenant upon
Landlord's receipt of an acceptable irrevocable letter of credit. If Tenant
defaults with respect to any provisions of this Lease, including but not limited
to provisions relating to the payment of Rent, Landlord may (but shall not be
required to) draw down on the irrevocable letter of credit for payment of any
sum which Landlord may spend or become obligated to spend by reason of Tenant's
default, or to compensate Landlord for any loss or damage which Landlord may
suffer by reason of Tenant's default. Landlord and Tenant acknowledge that such
irrevocable letter of credit will be treated as if it were a cash Security
Deposit, and such irrevocable letter of credit may be drawn down upon by
Landlord upon demand and presentation of evidence of the identity of Landlord to
the issuing bank, in the event that Tenant defaults with respect to any
provision of this Lease and such default is not cured within any applicable cure
period. Landlord acknowledges that it is not entitled to draw down such
irrevocable letter of credit unless Landlord would have been entitled to draw
upon a cash Security Deposit pursuant to the terms of Paragraph 4G of the Lease.
Concurrently with the delivery of the required information to the issuing bank,
Landlord shall deliver to Tenant written evidence of the default upon which the
draw down was based, together with evidence that Landlord has provided to Tenant
the written notice of such default which was required under the applicable
provision of the Lease, and evidence of the failure of Tenant to cure such
default
35.
<PAGE> 36
within the applicable grace period following receipt of such notice of default.
If any portion of the irrevocable letter of credit is used or applied pursuant
hereto, Tenant shall, within ten (10) days after receipt of a written demand
therefor from Landlord, restore and replace the value of such security by either
(i) depositing cash with Landlord in the amount equal to the sum drawn down
under the irrevocable letter of credit, or (ii) increasing the irrevocable
letter of credit to its value immediately prior to such application. Tenant's
failure to replace the value of the security as provided in the preceding
sentence shall be a material breach of its obligation under this Lease.
57. ASSIGNMENT OF WARRANTIES.
During the Term of the Lease, Landlord hereby assigns to Tenant all of
Landlord's Contractor's warranties and shall cooperate with Tenant in enforcing
any of such warranties except that Landlord shall not be required to pay any
legal fees or incur any expenses in this regard.
58. BROKERS.
Landlord and Tenant each represent to the other that they have dealt with
no real estate brokers, agents, or finders in connection with this transaction,
except as follows: Cornish & Carey Oncor International ("C&C"), whose commission
shall be paid by Landlord in accordance with Landlord's standard commission
schedule which commission for this Lease is a total of $100,000.00. Each party
agrees to defend, protect, indemnify and hold the other party harmless from and
against all claims for brokerage commissions, finder's fees, and other
compensation made by any broker, agent, or finder as consequence of the
indemnifying party's actions or dealing with such broker, agent or finder. The
parties hereto acknowledge that Landlord will not pay an additional brokerage
fee to C&C or any broker in the event the term of this Lease is extended for any
reason whatsoever.
36.
<PAGE> 37
WESTPORT OFFICE PARK
REDWOOD CITY, CALIFORNIA
[MAP]
<PAGE> 38
EXHIBIT 10.9
LEASE AGREEMENT
BLDG: Westport 19
OWNER: 30
PROP: 0119
UNIT: 1
TENANT: IPAS01
LEASE: 0119-IPAS01-01
This Lease, made this 26th day of October, 1999 between WESTPORT JOINT
VENTURE, a California join venture, hereinafter called Landlord, and IPASS, INC.
a California corporation, hereinafter called Tenant.
WITNESSETH:
Landlord hereby leases to Tenant and Tenant hereby hires and takes from
Landlord those certain premises (the "Premises") outlined in red on Exhibit "A",
attached hereto and incorporated herein by this reference thereto more
particularly described as follows:
All of that certain 48,384+ square foot, two-story building located at
3600 Bridge Parkway, Redwood City, California 94065. Said Premises is more
particularly shown within the area outlined in Red on Exhibit A attached hereto.
The entire parcel, of which the Premises is a part, is shown within the area
outlined in Green on Exhibit A attached. The Premises shall be improved by
Landlord as shown on Exhibit B to be attached hereto, and is leased on an
"as-is" basis, in its present condition, and in the configuration as shown in
Red on Exhibit B to be attached hereto.
As used herein the Complex shall mean and include all of the land
outlined in Green and described in Exhibit "A", attached hereto, common area
private roads within the Complex, and all of the building, improvements,
fixtures and equipment now or hereafter situated on said land.
Said letting and hiring is upon and subject to the terms, covenants and
conditions hereinafter set forth and Tenant covenants as a material part of the
consideration for this Lease to perform and observe each and all of said terms,
covenants and conditions. The Lease is made upon the conditions of such
performance and observance.
1. USE.
Tenant shall the Premises only in conformance with applicable
governmental laws, regulations, rules and ordinances for the purpose of general
office, light manufacturing, research and development, and storage and other
uses necessary for Tenant to conduct Tenant's business, provided that such uses
shall be in accordance with all applicable governmental laws and ordinances and
for no other purposes. Tenant shall not do or permit it be done in or about the
Premises or the Complex nor bring or keep or permit to be brought or kept in or
about the Premises or Complex anything which is prohibited by or will in any way
increased the existing rate of (or otherwise affect) fire or any insurance
covering the Complex or any part thereof, or any of its contents, or will cause
a cancellation of any insurance covering the Complex or any part thereof, or any
of its contents. Tenant shall not do or permit to be done anything in, on or
1.
<PAGE> 39
about the Premises or the Complex which will in any way obstruct or interfere
with the rights of other tenants or occupants of the Complex or injure or annoy
them, or use or allow the Premises to be used for any improper, immoral,
unlawful or objectionable purpose, nor shall Tenant cause, maintain or permit
any nuisance in, on or about the Premises or the Complex. No sale by auction
shall be permitted on the Premises. Tenant shall not place any loads upon the
floors, walls, or ceiling, which endanger the structure , or place any harmful
fluids or other materials in the drainage system of the building, or overall
existing electrical or other mechanical systems. No waste materials or refuse
shall be dumped upon or permitted to remain upon any part of the Premises or
outside of the building in which the Premises are a part, except in trash
containers placed inside exterior enclosures designated by Landlord for the
purpose or inside of the building proper where designated by Landlord. NO
materials, supplies, equipment, finished products or semi-finished products, raw
materials or articles of any nature shall be stored upon or permitted to remain
outside the Premises or on any portion of common area of the Complex. No
loudspeaker or other device, system or apparatus which can be heard outside the
Premises shall be used in or at the Premises without the prior written consent
of Landlord. Tenant shall not commit or suffer to be committed any waste in or
upon the Premises. Tenant shall indemnify, defend and hold Landlord harmless
against any loss, expense, damage, attorneys' fees or liability arising out of
failure of Tenant to comply with any applicable law. Tenant shall comply with
any covenant, condition, or restriction ("CC&R's") affecting the Premises. The
provisions of this paragraph are for the benefit of Landlord only and shall not
be construed to be the benefit of any tenant or occupant of the Complex.
2. TERM.*
A. The term of this Lease shall be for a period of ten (10) years,
fifteen (15) days (unless sooner terminated as hereinafter provided) and subject
to Paragraph 2(B) and 3, shall commence on the 15th day of February, 2000 and
end on the 28th day of February, 2010.
B. Possession of the Premises shall be deemed tendered and the term of
this Lease shall commence when the first of the following occurs:
(a) One day after a Certificate of Occupancy is granted by the
proper governmental agency, or, if the governmental agency having jurisdiction
over the area in which the Premises are situated does not issue certificate of
occupancy, then the same number of days after certification by Landlord's
architect or contract that Landlord's construction work has been completed and
Landlord has delivered possession of the Premises to Tenant; or
(b) Upon the occupancy of the Premises by any of Tenant's operating
personnel; or
(c) When the Tenant Improvements have been substantially completed
for Tenant's use and occupancy, in accordance and compliance with Exhibit B of
this Lease Agreement and Landlord has delivered the Premises to Tenant; or
- -------------------
* It is agreed in the event said Lease commences on a date other than the
first day of the month the term of the Lease will be extended to account
for the number of days in the partial month. The Basic Rent during the
recruiting partial month will be pro-rated (for the number of days in the
partial month) at the Basic Rent scheduled for the projected commencement
date as shown in Paragraph 42.
2.
<PAGE> 40
(d) As otherwise agreed in writing.
3. POSSESSION.
If Landlord, for any reason whatsoever, cannot deliver possession of
said premises to Tenant at the commencement of the said term, as hereinbefore
specified, this Lease shall not be void or voidable; no obligation of Tenant
shall be affected thereby; nor shall Landlord or Landlord's agents be liable to
Tenant for any loss or damage resulting therefrom; but in the event the
commencement and termination dates of the Lease, and all other dates affected
thereby shall be revised to conform to the date of Landlord's delivery of
possession, as specified in Paragraph 2(b), above. The above is, however,
subject to the provision that the period of delay, of delivery of the premises
shall not exceed 60 days from the commencement date herein (except those delays
caused by Acts of God, strikes, war, utilities, governmental bodies, weather,
unbillable materials, and delays beyond Landlord's control shall be excluded in
calculating such period) in which instance Tenant, at its option, may, by
written notice to Landlord, terminate this Lease.
4. RENT
A. BASIC RENT. Tenant agrees to pay to landlord at such place as
Landlord may designate without deduction, offset, prior notice, or demand, and
Landlord agrees to accept as Basic Rent for the leased Premises the total sum of
TWENTY FIVE MILLION SEVEN HUNDRED EIGHTY FIVE THOUSAND SEVEN HUNDRED FIFTY TWO
and 28/100 ($25,785,752.28) Dollars in lawful money of the United States of
America, payable as follows:
See Paragraph 42 for Basic Rent Schedule.
B. TIME FOR PAYMENT. In the event that the term of this Lease commences
on a date other than the first day of a calendar month, on the date of
commencement of the term hereof Tenant shall pay to Landlord as rent for the
period from such date of commencement to the first day of the next succeeding
calendar month that proportion of the monthly rent hereunder which the number of
days between such date of commencement and the first day of the next succeeding
calendar month bears to thirty (30). In the even that the term of this lease for
any reason ends on a date other than the last day of calendar month, on the
first day of the last calendar month of the term hereof. Tenant shall pay to
Landlord as rent for the period from said first day of said last calendar month
to and including the last day of the term hereof that proportion of the monthly
rent hereunder which the number of days between said final day of said last
calendar month and the last day of the term hereof bears to thirty (30).
C. LATE CHARGE. Notwithstanding any other provision of this Lease, if
Tenant is in default in the payment of rental as set forth in this Paragraph 4
when due, or any part thereof, Tenant agrees to pay Landlord. In addition to the
delinquent rental due, a late charge for each rental payment in default ten (10)
days. Said late charge shall equal ten (10%) percent of each rental payment so
in default.
D. ADDITIONAL RENT. Beginning with the commencement date of the term of
this Lease, Tenant shall pay to Landlord in addition to the Basic Rent and as
Additional Rent the following:
3.
<PAGE> 41
(a) Tenant's proportionate share of all Taxes relating to the
complex as set forth in Paragraph 12, and
(b) Tenant's proportionate share of all insurance premiums and
deductibles relating to the Complex, as set forth in Paragraph 15; and
(c) Tenant's proportionate share of expenses for the operation,
management, maintenance and repair of the Building (including common area of the
building) and Common Areas of the Complex in which the Premises are located as
set forth in Paragraph 7, and
(d) All charges, costs and expenses, which Tenant is required to
pay hereunder, together with all interest and penalties, cots and expenses
including attorneys' fees and legal expenses, that may accrue thereto in the
event of Tenant's failure to pay such amounts, and all damages, reasonable costs
and expenses which Landlord may incur by reason of default of Tenant or failure
on Tenant's part to comply with the terms of the Lease. In the event of
nonpayment by Tenant of Additional Rent, Landlord shall have all the rights and
remedies with respect thereto as Landlord has for nonpayment of rent.
The Additional Rent due hereunder shall be paid to Landlord or
Landlord's agent (i) within five days for taxes and insurance and within thirty
days for all other Additional Rent items after presentation of invoice form
Landlord or Landlord's agent setting forth such Additional Rent and/or (ii) at
the option of Landlord, Tenant shall pay to Landlord monthly, in advance,
Tenant's prorata share of an amount estimated by Landlord to be Landlord's
approximate average monthly expenditure for such Additional Rent items, which
estimated amount shall be reconciled within 120 days of at the end of each
calendar years or more frequently if Landlord so elects to do so at Landlord's
sole and absolute discretion as compared to Landlord's actual expenditure for
said Additional Rent items, with Tenant paying to Landlord, upon demand, any
amount of actual expenses expended by Landlord in excess of said estimated
amount, or landlord crediting to Tenant (providing Tenant is not in default in
the performance of any of the terms, covenants and conditions of this Lease) any
amount of estimated payments made by Tenants in excess of Landlord's actual
expenditures for said Additional Rent Items. Within thirty (30) days after
receipt of Landlord's reconciliation, Tenant shall have the right, at Tenant's
sole expense, to audit, at a mutually convenient time at Landlord's office,
Landlord's records relating to the foregoing expense. Such audit must be
conducted by Tenant or an independent nationally recognized accounting firm that
is not being compensated by Tenant or other third party on a contingency fee
basis. Landlord shall be provided a complete copy of said audit at no expenses
to Landlord. If such audit reveals that Landlord has overcharged Tenant and the
audit is not challenged by Landlord, the amount overcharged shall be credited to
Tenant's account with in thirty (30) days after the audit is concluded.
The respective obligations of Landlord and Tenant under this paragraph
shall survive the expiration or other termination of the term of this Lease, and
if the term hereof shall expire or shall other wise terminate on a day other
than the last day of a calendar year, the actual Additional Rent incurred for
the calendar year in which the term hereof expires or otherwise terminates shall
be determined and settled on the basis of the statement of actual Additional
Rent for such calendar year and shall be prorated in proportion which the number
of days in such calendar year preceding such expiration or termination bears to
365.
4.
<PAGE> 42
E. FIXED MANAGEMENT FEE. Beginning with the Commencement Date of the
Term of this Lease, Tenant shall pay, in addition tot he Basic Rent and
Additional Rent, a fixed monthly management fee ("Management Fee") equal to two
percent (2%) of the Basic Rent due for each month during the Lease Term. Said
Management Fee shall be paid by Tenant to A&P Property Management Company at
2560 Mission College Blvd., Suite 101, Santa Clara, CA 95054.
F. PLACE OF PAYMENT OF RENT AND ADDITIONAL RENT. All Basic Rent
hereunder and all payments hereunder for Additional Rent shall be paid to
Landlord at the office of Landlord at Westport Joint Venture, 2560 Mission
College Blvd., Suite 101, Santa Clara, CA 95054 or to such other person or to
such other place as Landlord may from time to time designate in writing.
G. SECURITY DEPOSIT. Concurrently with Tenant's execution of this Lease,
Tenant shall deposit with Landlord the sum of FOUR HUNDRED NINETY THREE THOUSAND
FIVE HUNDRED SIXTEEN AND 80/100 ($493,516.80) Dollars. Said sum shall be held by
Landlord as a Security Deposit for the faithful performance by Tenant of all of
the terms, covenants, and conditions of this Lease to be kept and performed by
Tenant during the term hereof. If Tenant defaults with respect to any provision
of this Lease, including, but not limited to, the provisions relating to the
payment of rent and any of the monetary sums due herewith, Landlord may (but
shall not be required to) use, apply or retain all or any part of this Security
Deposit for the payment of any other amount which Landlord may spend by reason
of Tenant's default or to compensate Landlord for any other loss or damages
which Landlord may suffer by reason of Tenant's default. If any portion of said
Deposit is so used or applied. Tenant shall, within ten (10) days after written
demand therefor, deposit case with Landlord in the amount sufficient to restore
the Security Deposit to its original amount. Tenant's failure to do so shall be
a material breach of this Lease. Landlord shall not be required to keep this
Security Deposit separate from its general funds, and Tenant shall not be
entitled to interest on such Deposit. If Tenant fully and faithfully performs
every provision of this Lease to be performed by it, the Security deposit or any
balance thereof shall be returned to Tenant (or at Landlord's option, to the
last assignee of Tenant's interest hereunder) at the expiration of the Lease
term and after Tenant has vacated the Premises. In the event of termination of
Landlord's interest in this Lease, Landlord shall transfer said deposit to
Landlord's successor in interest whereupon Tenant agrees to release Landlord
from liability for the return of such Deposit or the accounting therefor. See
Paragraph 56.
5. RULES AND REGULATIONS AND COMMON AREA.
Subject in to the terms and conditions of this Lease and such reasonable
Rules and regulations as Landlord may from time to time prescribe, Tenant and
Tenant's Employees, invitees and customers shall, in common with other occupants
of the Complex in which the Premises are located, and their respective
employees, invitees and customers and others entitled to the use thereof, have
the non-exclusive right to use the access roads, parking areas, and facilities
provided and designated by Landlord for the general use and convenience of the
occupants of the Complex in which the Premises are located, which areas and
facilities are referred to herein as "Common Area". This right shall terminate
upon the termination of this Lease. Landlord reserves the right from time to
time to make changes in the shape, size, location, amount and extent of Common
Area. Landlord further reserves the right to promulgate
5.
<PAGE> 43
such reasonable rules and regulations relating to the use of the Common Area,
and any part of parts thereof, as Landlord may deem appropriate for the best
interests of the occupants of the Complex. The Rules and Regulations shall be
binding upon Tenant upon delivery of a copy of them to Tenant, and Tenant shall
abide by them and cooperate in their observance. Such Rules and Regulations may
be reasonably amended by Landlord from time to time, with or without advance
notice, and all amendments shall be effective upon delivery of a copy to Tenant,
Landlord shall not be responsible to Tenant for the non-performance by any other
tenant or occupant of the Complex of any of said Rules and Regulations.
Landlord shall operate, manage and maintain the Common Area. The manner
in which the Common Area shall be maintained and the expenditures for such
maintenance shall be at the discretion of Landlord. Landlord's rights pursuant
to this Paragraph 5 shall be subject to the condition that exercise of any such
rights shall not unreasonably interfere with Tenant's use of the Premises.
6. PARKING.
Tenant shall have the right to use with other tenants or occupants of
the Complex 161 parking spaces, in the common parking areas of the Complex.
Tenant agrees, that Tenant, Tenant's employees, agents, representatives and/or
invitees shall not use parking spaces in excess of said 161 spaces allocated to
Tenant hereunder. Landlord shall have the right, at Landlord's discretion, to
specifically designate the location of Tenant's parking spaces within the common
parking areas of the Complex in the event of a dispute among the tenants
occupying the building and/or Complex referred to herein, in which event Tenant
agrees that Tenant, Tenant's employees, agents, representatives and/or invitees
shall not use any parking spaces other than those parking spaces specifically
designated by Landlord for Tenant's use. Said parking spaces, if specifically
designated by Landlord to Tenant, may be relocated by Landlord at any time, and
from time to time. Landlord reserves the right, at Landlord's sole discretion,
to rescind any specific designation of parking spaces, thereby returning
Tenant's parking spaces to the common parking area. Landlord shall give Tenant
written notice of any change in Tenant's parking spaces. Tenant shall not, at
any time, park, or permit to be parked, any trucks or vehicles adjacent to the
loading areas so as to interfere in any way with the use of such areas, nor
shall Tenant at any time park, or permit the parking of Tenant's trucks or other
vehicles or the trucks and vehicles of Tenant's suppliers or others, in any
portion of the common area not designated by Landlord for such use by Tenant.
Tenant shall not park nor permit to be parked, any inoperative vehicles or
equipment on any portion of the common parking area or other common areas of the
Complex. Tenant agrees to assume responsibility for compliance by its employees
with the parking provision contained herein. If Tenant or its employees park in
other than such designated parking areas, then Landlord may charge Tenant, as an
additional charge, and Tenant agrees to pay, ten ($10.00) Dollars per day for
each day or partial day each such vehicle is parked in any area other than that
designated. Tenant hereby authorizes Landlord at Tenant's sole expense to tow
away from the Complex any vehicle belonging to Tenant or Tenant's employees
parked in violation of these provisions, or to attach violation stickers or
notices to such vehicles. Tenant shall use the parking areas for vehicle parking
only, and shall not use the parking areas for storage.
6.
<PAGE> 44
7. EXPENSES OF OPERATION, MANAGEMENT, AND MAINTENANCE OF THE COMMON AREAS OF THE
COMPLEX.
As Additional Rent and in accordance with Paragraph 4D of this Lease,
Tenant shall pay to Landlord Tenant's proportionate share (calculated on a
square footage or other equitable basis as calculated by Landlord) of all
expenses of operation, management, maintenance and repair of the Common Areas of
the Complex including, but not limited to, license, permit, and inspection fees;
security; utility charges associated with exterior landscaping and lighting
(including water and sewer charges); all charges incurred in the maintenance and
replacement of landscaped areas, private roads within the Complex and roads with
reciprocal easement areas; lakes, parking lots, and paved areas, (including
repairs, replacement, resealing and restriping), sidewalks, driveways;
maintenance, repair and replacement of all fixtures and electrical, mechanical,
and plumbing systems; structural elements and exterior surfaces of the
buildings; salaries and employee benefits of personnel and payroll taxes
applicable thereto; supplies, materials, equipment and tools; the cost of
capital expenditures which have the effect of reducing operating expenses,
provided, however, that in the event Landlord makes such capital improvements,
Landlord may amortize its investment in said improvements (together with
interest at the rate of fifteen (15%) percent per annum on the unamortized
balance) as an operating expense in accordance with standard accounting
practices, provided, that such amortization is not at a rate greater than the
anticipated savings in the operating expenses.
"Additional Rent" as used herein shall not include Landlord's debt
repayments; interest on charges; expenses directly or indirectly incurred by
Landlord for the benefit of any other tenant; cost for the installation of
partitioning or any other tenant improvements; cost of attracting tenants;
depreciation; interest, or executive salaries.
8. ACCEPTANCE AND SURRENDER OF PREMISES.
By entry hereunder, Tenant accepts the Premises as being in good and
sanitary order, condition and repair and accepts the building and improvements
included in the Premises in their present condition and without representation
or warranty by Landlord as to the condition of such building or as to the use or
occupancy which may be made thereof. Any exceptions to the foregoing must be by
written agreement executed by Landlord and Tenant. Tenant agrees on the last day
of the Lease term, or on the sooner termination of this Lease, to surrender the
Premises promptly and peaceably to Landlord in good condition and repair
(damages by Acts of God, fire, normal wear and tear excepted), with all interior
walls painted, or cleaned so that they appear freshly painted, and repaired and
replaced, if damaged; all floors cleaned and waxed; all carpets cleaned and
shampooed; the air conditioning and heating equipment serviced by a reputable
and licensed service firm and in good operating condition (provided the
maintenance of such equipment has been Tenant's responsibility during the term
of this Lease) together with all alterations, additions, and improvements which
may have been made in, to, or on the Premises (except movable trade fixtures
installed at the expense of Tenant) except that Tenant shall ascertain from
Landlord within thirty (30) days before the end of the term of this Lease
whether Landlord desires to have the Premises or any part or parts thereof
restored to their condition and configuration as when the Premises were
delivered to Tenant and if Landlord shall so desire, then Tenant shall restore
said Premises or such part or parts thereof before the end of this Lease at
Tenant's sole cost and expense. Tenant, on or before the end of the term or
sooner termination
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of this Lease, shall remove all of Tenant's personal property and trade fixtures
from the Premises, and all property not so removed on or before the end of the
term or sooner termination of this Lease shall be deemed abandoned by Tenant and
title to same shall thereupon pass to Landlord without compensation to Tenant.
Landlord may, upon termination of this Lease, remove all moveable furniture and
equipment so abandoned by Tenant, at Tenant's sole cost, and repair any damage
caused by such removal at Tenant's sole cost. If the Premises be not surrendered
at the end of the term or sooner termination of this Lease, Tenant shall
indemnify Landlord against loss or liability resulting from the delay by Tenant
in so surrendering the Premises including, without limitation, any claims made
by any succeeding tenant founded on such delay. Nothing contained herein shall
be construed as an extension of the term hereof or as a consent of Landlord to
any holding over by Tenant. The voluntary or other surrender of this Lease or
the Premises by Tenant or a mutual cancellation of this Lease shall not work as
a merger and, at the option of Landlord, shall either terminate all or any
existing sublease or subtenancies or operate as an assignment to Landlord of all
or any such subleases or subtenancies.
9. ALTERATIONS AND ADDITIONS.
Tenant shall not make, or suffer to be made, any alteration or addition
to the Premises, or any part thereof, without the written consent of Landlord
(which written consent (i) shall not be unreasonably withheld and (ii) will
specify whether Landlord shall require removal of said alterations and/or
additions, provided Tenant requests such determination from Landlord), first had
and obtained by Tenant, but at the cost of Tenant, and any addition to, or
alteration of, the Premises, except moveable furniture and trade fixtures, shall
at once become a part of the Premises and belong to Landlord. Landlord reserves
the right to approve all contractors and mechanics proposed by Tenant to make
such alterations and additions. Tenant shall retain title to all moveable
furniture and trade fixtures placed in the Premises. All heating, lighting,
electrical, air-conditioning, floor to ceiling partitioning, drapery, carpeting,
and floor installations made by Tenant, together with all property that has
become an integral part of the Premises, shall not be deemed trade floor to
ceiling fixtures. Tenant agrees that it will not proceed to make such alteration
or additions, without having obtained consent from Landlord to do so, and until
five (5) days from the receipt of such consent, in order that Landlord may post
appropriate notices to avoid any liability to contractors or material suppliers
for payment for Tenant's improvements. Tenant will at all times permit such
notices to be posted and to remain posted until the completion of work. Tenant
shall, if required by Landlord, secure at Tenant's own cost and expense, a
completion and lien indemnity bond, satisfactory to Landlord, for such work.
Tenant further covenants and agrees that any mechanic's lien filed against the
Premises or against the Complex for work claimed to have been done for, or
materials claimed to have been furnished to Tenant, will be discharged by
Tenant, by bond or otherwise, within ten (10) days after the filing thereof, at
the cost and expense of Tenant. Any exceptions to the foregoing must be made in
writing and executed by both Landlord and Tenant. Notwithstanding anything to
the contrary herein, under no circumstances shall Tenant be authorized to
penetrate the soil to a depth that exceeds three and one-half feet from the
uppermost surface of the soil.
8.
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10. TENANT MAINTENANCE.
Tenant shall, at its sole cost and expense, keep and maintain the
Premises (including appurtenances) and every part thereof in a high standard of
maintenance and repair, and in good and sanitary condition. Tenant's maintenance
and repair responsibilities herein referred to include, but are not limited to,
all windows, window frames, plate glass, glazing, truck doors, plumbing systems
(such as water and drain lines, sinks, toilets, faucets, drains, showers and
water fountains), electrical systems (such as panels, conduits, outlets,
lighting fixtures, lamps, bulbs, tubes, ballasts), heating and air-conditioning
systems (such as compressors, fans, air handlers, ducts, mixing boxes,
thermostats, time clocks, boilers, heaters, supply and return grills), store
fronts, roofs, downspouts, all interior improvements within the premises
including but not limited to wall coverings, window coverings, carpet, floor
coverings, partitioning, ceilings, doors (both interior and exterior, including
closing mechanisms, latches, locks, skylights (if any), automatic fire
extinguishing systems, and elevators and all other interior improvements of any
nature whatsoever. Tenant agrees to provide carpet shields under all rolling
chairs or to otherwise be responsible for wear and tear of the carpet caused by
such rolling chairs if such wear and tear exceeds that caused by normal foot
traffic in surrounding areas. Areas of excessive wear shall be replaced at
Tenant's sole expense upon Lease termination. Tenant hereby waives all rights
under, and benefits of, subsection 1 of Section 1932 and Section 1941 of the
California Civil Code and under any similar law, statute or ordinance now or
hereafter in effect.
11. UTILITIES.
Tenant shall pay promptly, as the same become due, all charges for
water, gas, electricity, telephone, telex and other electronic communications
service, sewer service, waste pick-up and any other utilities, materials or
services furnished directly to or used by Tenant on or about the Premises during
the term of this Lease, including, without limitation, any temporary or
permanent utility surcharge or other exactions whether or not hereinafter
imposed.
Landlord shall not be liable for and Tenant shall not be entitled to any
abatement or reduction of rent by reason of any interruption or failure of
utility services to the Premises when such interruption or failure is caused by
accident, breakage, repair, strikes, lockouts, or other labor disturbances or
labor disputes of any nature, or by any other cause, similar or dissimilar,
beyond the reasonable control of Landlord.
12. TAXES.
A. As Additional Rent and in accordance with Paragraph 4D of this Lease,
Tenant shall pay to Landlord Tenant's proportionate share of all Real Property
Taxes, which prorata share shall be allocated to the leased Premises by square
footage or other equitable basis, as calculated by Landlord. The term "Real
Property Taxes", as used herein, shall mean (i) all taxes, assessments, levies
and other charges of any kind or nature whatsoever, general and special,
foreseen and unforeseen (including all installments of principal and interest
required to pay any general or special assessments for public improvements and
any increases resulting from reassessment caused by any change in ownership of
the Complex) now or hereafter imposed by any governmental or quasi-governmental
authority or special district having the direct or indirect
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power to tax or levy assessments, which are levied or assessed against, or with
respect to the value, occupancy or use of, all or any portion of the Complex (as
now constructed or as may at any time hereafter be constructed, altered, or
otherwise changed) or Landlord's interest therein; any improvements located
within the Complex (regardless of ownership); the fixtures, equipment and other
property of Landlord, real or personal, that are an integral part of and located
in the Complex; or parking areas, public utilities, or energy within the
Complex; (ii) all charges, levies or fees imposed by reason of environmental
regulation or other governmental control of the Complex; and (iii) all costs and
fees (including attorneys' fees) incurred by Landlord in contesting any Real
Property Tax and in negotiating with public authorities as to any Real Property
Tax. If at any time during the term of this Lease the taxation or assessment of
the Complex prevailing as of the commencement date of this Lease shall be
altered so that in lieu of or in addition to any Real Property Tax described
above there shall be levied, assessed or imposed (whether by reason of a change
in the method of taxation or assessment, creation of a new tax or charge, or any
other cause) an alternate or additional tax or charge (i) on the value, use or
occupancy of the Complex or Landlord's interest therein or (ii) on or measured
by the gross receipts, income or rentals from the Complex, on Landlord's
business on leasing the Complex, or computed in any manner with respect to the
operation of the Complex, then any such tax or charge, however designated, shall
be included within the meaning of the term "Real Property Taxes" for purposes of
this Lease. If any Real Property Tax is based upon property or rents unrelated
to the Complex, then only that part of such real Property Tax that is fairly
allocable to the Complex shall be included within the meaning of the term "Real
Property Taxes". Notwithstanding the foregoing, the term "Real Property Taxes"
shall not include estate, inheritance, gift or franchise taxes of Landlord or
the federal or state net income tax imposed on Landlord's income from all
sources. The term "Real Estate Taxes" shall also include supplemental taxes
related to the period of Tenant's Lease Term whenever levied, including any such
taxes that may be levied after the Lease Term has expired.
B. TAXES ON TENANT'S PROPERTY
(a) Tenant shall be liable for and shall pay ten (10) days before
delinquency, taxes levied against any personal property or trade fixtures placed
by Tenant in or about the Premises. If any such taxes on Tenant's personal
property or trade fixtures are levied against Landlord or Landlord's property or
if the assessed value of the Premises is increased by the inclusion therein of a
value placed upon such personal property or trade fixtures of Tenant and if
Landlord, after written notice to Tenant, pays the taxes based on such increased
assessment, which Landlord shall have the right to do regardless of the validity
thereof, but only under proper protest if requested by Tenant, Tenant shall upon
demand, as the case may be, repay to Landlord the taxes so levied against
Landlord, or the proportion of such taxes resulting from such increase in the
assessment; provided that in any such event Tenant shall have the right, in the
name of Landlord and with Landlord's full cooperation, to bring suit in any
court of competent jurisdiction to recover the amount of any such taxes so paid
under protest, and any amount so recovered shall belong to Tenant.
(b) if the Tenant improvements in the Premises, whether installed,
and/or paid for by Landlord or Tenant and whether or not affixed to the real
property so as to become a part thereof, are assessed for real property tax
purposes at a valuation higher than the valuation at which standard office
improvements in other space in the Complex are assessed, then the real
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property taxes and assessments levied against Landlord or the Complex by reason
of such assessed valuation shall be deemed to be taxes levied against personal
property of Tenant and shall be governed by the provisions of 12B(a) above. If
the records of the County Assessor are available and sufficiently detailed to
serve as a basis for determining whether said Tenant improvements are assessed
at a higher valuation than standard office improvements in other space in the
Complex, such records shall be binding on both the Landlord and the Tenant. If
the records of the County Assessor are not available or sufficiently detailed to
serve as a basis for making said determination, the actual cost of construction
shall be used.
13. LIABILITY INSURANCE.
Tenant, at Tenant's expense, agrees to keep in force during the term of
this Lease a policy of commercial general liability insurance with a combined
single limit coverage of not less than Two Million Dollars ($2,000,000) per
occurrence for injuries to or death of persons occurring in, on or about the
Premises or the Complex, and property damage insurance with limits of $500,000.
The policy or policies affecting such insurance, certificate of insurance of
which shall be furnished to Landlord, shall name Landlord as additional
insureds, and shall inure any liability of Landlord, contingent or otherwise, as
respects acts or omissions of Tenant, its agents, employees or invitees or
otherwise by any conduct or transactions of any of said persons in or about or
concerning the Premises, including any failure of Tenants to observe or perform
any of its obligations hereunder; shall be issued by an insurance company
admitted to transact business in the State of California; and shall provide that
the insurance effected thereby shall not be canceled, except upon thirty (30)
days' prior written notice to Landlord. If, during the term of this Lease, in
the considered opinion of Landlord's Lender, insurance advisor, or counsel, the
amount of insurance described in this paragraph 13 is not adequate, Tenant
agrees to increase said coverage to such reasonable amount as Landlord's Lender,
insurance advisor, or counsel shall deem adequate.
14. TENANT'S PERSONAL PROPERTY INSURANCE AND WORKMAN'S COMPENSATION INSURANCE.
Tenant shall maintain a policy or policies of fire and property damage
insurance in "all risk" form with a sprinkler leakage endorsement insuring the
personal property, inventory, trade fixtures, and leasehold improvements within
the leased Premises for the full replacement value thereof. The proceeds from
any of such policies shall be used for the repair or replacement of such items
so insured.
Tenant shall also maintain a policy or policies of workman's
compensation insurance and any other employee benefit insurance sufficient to
comply with all laws.
15. PROPERTY INSURANCE.
Landlord shall purchase and keep in force and as Additional Rent and in
accordance with Paragraph 4D of this Lease, Tenant shall pay to Landlord (or
Landlord's agent if so directed by Landlord) Tenant's proportionate share
(calculated on a square footage or other equitable basis as calculated by
Landlord) of the deductibles on insurance claims and the cost of policy or
policies of insurance covering loss or damage to the Premises and Complex in the
amount of the
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<PAGE> 49
full replacement value thereof, providing protection against those perils
included within the classification of "all risks" insurance and flood and/or
earthquake insurance, if available, plus a policy of rental income insurance in
the amount of one hundred (100%) percent of twelve (12) months Basic Rent, plus
sums paid as Additional Rent and any deductibles related thereto. If such
insurance cost is increased due to Tenant's use of the Premises or the Complex,
Tenant agrees to pay to Landlord the full cost of such increase. Tenant shall
have no interest in nor any right to the proceeds of any insurance procured by
Landlord for the Complex.
Landlord and Tenant do each hereby respectively release the other, to
the extent of insurance coverage of the releasing party, from any liability for
loss or damage caused by fire or any of the extended coverage casualties
included in the releasing party's insurance policies, irrespective of the cause
of such fire or casualty; provided, however, that if the insurance policy of
either releasing party prohibits such waiver, then this waiver shall not take
effect until consent to such waiver is obtained. If such waiver is so
prohibited, the insured party affected shall promptly notify the other party
thereof.
16. INDEMNIFICATION.
Landlord shall not be liable to Tenant and Tenant hereby waives all
claims against Landlord for any injury to or death of any person or damage to or
destruction of property in or about the Premises or the Complex by or from any
cause whatsoever, including, without limitation, gas, fire, oil, electricity or
leakage of any character from the roof, walls, basement or other portion of the
Premises or the Complex but excluding, however, the willful misconduct or
negligence of Landlord, its agents, servants, employees, invitees, or
contractors of which negligence Landlord has knowledge and reasonable time to
correct. Except as to injury to persons or damage to property to the extent
arising from the willful misconduct or the negligence of Landlord, its agents
servants, employees, invitees, or contractors. Tenant shall hold Landlord
harmless from and defend Landlord against any and all expenses, including
reasonable attorneys' fees, in connection therewith, arising out of any injury t
or death of any person or damage to or destruction of property occurring in, on
or about the Premises, or any part thereof, from any cause whatsoever.
17. COMPLIANCE.
Tenant, at its sole cost and expense, shall promptly comply with all
laws, statutes, ordinances and governmental rules, regulations or requirements
now or hereafter in effect; with the requirements of any board of fire
underwriters or other similar body now or hereafter constituted; and with any
direction or occupancy certificate issued pursuant to law by any public officer;
provided, however, that no such failure shall be deemed a breach of the
provisions if Tenant, immediately upon notification, commences to remedy or
rectify said failure. The judgment of any court of competent jurisdiction or the
admission of Tenant in any action against Tenant, whether Landlord be a party
thereto or not, that Tenant has violated any such law, statute, ordinance or
governmental rule, regulation, requirement, direction or provision, shall be
conclusive of that fact as between Landlord and Tenant. This paragraph shall not
be interpreted as requiring Tenant to make structural changes or improvements,
except to the extent such changes or improvements are required as a result of
Tenant's use of the Premises. Tenant shall, at its sole cost and expense, comply
with any and all requirements pertaining to said Premises, or
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any insurance organization or company, necessary for the maintenance of
reasonable fire and public liability insurance covering the Premises.
18. LIENS.
Tenant shall keep the Premises and the Complex free from any liens
arising out of any work performed, materials furnished or obligation incurred by
Tenant. In the event that Tenant shall not, within ten (10) days following the
imposition of such lien, cause the same to be released of record, Landlord shall
have, in addition to all other remedies provided herein and by law, the right,
but no obligation, to cause the same to be released by such means as it shall
deem proper, including payment of the claim giving rise to such lien. All sums
paid by Landlord for such purpose, and all expenses incurred by it in connection
therewith, shall be payable to Landlord by Tenant on demand with interest at the
prime rate of interest as quoted by the Bank of America.
19. ASSIGNMENT AND SUBLETTING.
Tenant shall not assign, transfer, or hypothecate the leasehold estate
under this Lease, or any interest therein, and shall not sublet the Premises, or
any part thereof, or any right or privilege appurtenant thereto, or suffer any
other person or entity to occupy or use the Premises, or any portion thereof,
without, in each case, the prior written consent of Landlord which consent will
not be unreasonably withheld. As a condition for granting this consent to any
assignment, transfer, or subletting, Landlord shall require Tenant to pay to
Landlord, as Additional Rent, seventy-five (75%) percent of all rents and/or
additional consideration due Tenant from its assignees, transferees, or
subtenants in excess of the Rent payable by Tenant to Landlord hereunder for the
assigned, transferred and/or subleased space ("Excess Rent"); provided, however,
that before sharing such Excess Rent, Tenant shall first be entitled to recover
from such Excess Rent the amount of any reasonable leasing commissions related
to said transaction paid by Tenant to third party brokers not affiliated with
Tenant. Tenant shall, by thirty (30) days written notice, advise Landlord of its
intent to assign or transfer Tenant's interest in the Lease or sublet the
Premises or any portion thereof for any part of the term hereof. Within thirty
(30) days after receipt of said written notice, Landlord may, in its sole
discretion, elect to terminate this Lease as to the portion of the Premises
described in Tenant's notice on the date specified in Tenant's notice by giving
written notice of such election to terminate. If no such notice to terminate is
given to Tenant within said thirty (30) day period, Tenant may proceed to locate
an acceptable sublease, assignee, or other transferee for presentment to
Landlord for Landlord's approval, all in accordance with the terms, covenants,
and conditions of this paragraph 19. If Tenant intends to sublet the entire
Premises and Landlord elects to terminate this Lease, this Lease shall be
terminated on the date specified in Tenant's notice. If, however, this Lease
shall be terminated on the date specified in Tenant's notice. If, however, this
Lease shall terminate pursuant to the foregoing with respect to less than all
the Premises, the rent, as defined and reserved hereinabove shall be adjusted on
a pro rata basis to the number of square feet retained by Tenant, and this Lease
as so amended shall continue in full force and effect. In the event Tenant is
allowed to assign, transfer or sublet the whole or any part of the Premises,
with the prior written consent of Landlord, no assignee, transferee or subtenant
shall assign or transfer this Lease, either in whole or in art, or sublet the
whole or any part of the Premises, without also having obtained the prior
written consent of Landlord. A consent of Landlord to one assignment,
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transfer, hypothecation, subletting, occupation or use by any other person shall
not release Tenant from any of Tenant's obligations hereunder or be deemed to be
a consent to any subsequent similar or dissimilar assignment, transfer,
hypothecation, subletting, occupation or use by any other person. Any such
assignment, transfer, hypothecation, subletting, occupation or use without such
consent shall be void and shall constitute a breach of this Lease by Tenant and
shall, at the option of Landlord exercised by written notice to Tenant,
terminate this Lease. The leasehold estate under this Lease shall not, nor shall
any interest therein, be assignable for any purpose by operation of law without
the written consent of Landlord. As a condition to its consent, Landlord shall
require Tenant to pay all expenses in connection with the assignment, and
Landlord shall require Tenant's assignee or transferee (or other assignees or
transferees) to assume in writing all of the obligations under this Lease and
for Tenant to remain liable to Landlord under the Lease. Notwithstanding the
above, in no event will Landlord consent to sub-sublease.
20. SUBORDINATION AND MORTGAGES.
In the event Landlord's title or leasehold interest is now or hereafter
encumbered b a deed of trust, upon the interest of Landlord in the land and
buildings in which the demised Premises are located, to secure a loan from a
lender (hereinafter referred to as "Lender") to Landlord, Tenant shall, at the
request of Landlord or Lender, execute in writing an agreement subordinating its
rights under this Lease to the lien of such deed of trust, or, if so required,
agreeing that the lien of Lender's deed of trust shall be or remain subject and
subordinate to the rights of Tenant under this Lease. Notwithstanding any such
subordination, Tenant's possession under this Lease shall not be disturbed if
Tenant is not in default and so long as Tenant shall pay all rent and observe
and perform all of the provisions set forth in this Lease.
21. ENTRY BY LANDLORD.
Landlord reserves, and shall at all reasonable times after at least 24
hours notice (except in emergencies) have, the right to enter the Premises to
inspect them; to perform any services to be provided by Landlord hereunder, to
submit the Premises o prospective purchasers, mortgagers or tenants; to post
notices of nonresponsibility; and to alter, improve or repair the Premises and
any portion of the Complex, all without abatement of rent; and may erect
scaffolding and other necessary structures in or through the Premises where
reasonably required by the character of the work to be performed; provided,
however that the business of Tenant shall be interfered with to the least extent
that is reasonably practical. For each of the foregoing purposes, Landlord shall
at all times have and retain a key with which to unlock all of the doors in an
emergency in order to obtain entry to the Premises, and any entry to the
Premises obtained by Landlord and by any of said means, or otherwise, shall not
under any circumstances be construed or deemed to be a forcible or unlawful
entry into or a detainer of the Premises or an eviction, actual or constructive,
of Tenant from the Premises or any potion thereof. Landlord shall also have the
right at any time to change the arrangement or location of entrances or
passageways, doors and doorways, and corridors, elevators, stairs, toilets or
other public parts of the Complex and to change the name, number or designation
by which the Complex is commonly known, and none of the foregoing shall be
deemed an actual or constructive eviction of Tenant, or shall entitle Tenant to
any reduction of rent hereunder.
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22. BANKRUPTCY AND DEFAULT.
The commencement of a bankruptcy action or liquidation action or
reorganization action or insolvency action or an assignment of or by Tenant for
the benefit of creditors, or any similar action undertaken by Tenant, or the
insolvency of Tenant, shall, at Landlord's option, constitute a breach of this
Lease by Tenant. If the trustee or receiver appointed to serve during a
bankruptcy, liquidation, reorganization, insolvency or similar action elects to
reject Tenant's unexpired Lease, the trustee or receiver shall notify Landlord
in writing of its election within thirty (30) days after an order for relief in
a liquidation action or within thirty (30) days after the commencement of any
action.
Within thirty (30) days after court approval of the assumption of this
Lease, the trustee or receiver shall cure (or provide adequate assurance to the
reasonable satisfaction of Landlord that the trustee or receiver shall cure) any
and all previous defaults under the unexpired Lease and shall compensate
Landlord for all actual pecuniary loss and shall provide adequate assurance of
future performance under said Lease to the reasonable satisfaction of Landlord.
Adequate assurance of future performance, as used herein, includes, but shall
not be limited to: (i) assurance of source and payment of rent, and other
consideration due under this Lease; (ii) assurance that the assumption or
assignment of this Lease will not breach substantially any provision, such as
radius, location, use, or exclusivity provision, in any agreement relating to
the above described Premises.
Nothing contained in this section shall affect the existing right of
Landlord to refuse to accept an assignment upon commencement of or in connection
with a bankruptcy, liquidation, reorganization or insolvency action or an
assignment of Tenant for the benefit of creditors or other similar act. Nothing
contained in this Lease shall be construed as giving or granting or creating an
equity in the demised Premises to Tenant. In no event shall the leasehold estate
under this Lease, or any interest therein, be assigned by voluntary or
involuntary bankruptcy proceeding without the prior written consent of Landlord.
In no event shall this Lease or any rights or privileges hereunder be an asset
of Tenant under any bankruptcy, insolvency or reorganization proceedings.
The failure to perform or honor any covenant, condition or
representation made under this Lease shall constitute a default hereunder by
Tenant upon expiration of the appropriate grace period hereinafter provided.
Tenant shall have a period of five (5) days from the date of written notice from
Landlord within which to cure any default in the payment of rental or adjustment
thereto. Tenant shall have a period of thirty (30) days from the date of written
notice from Landlord within which to cur any other default under this Lease;
provided, however, that if the nature of Tenant's failure is such that more than
thirty (30) days is reasonably required to cure the same, Tenant shall not be in
default so long as Tenant commences performance within such thirty (30) day
period and thereafter prosecutes the same to completion. Upon an uncured default
of this Lease by Tenant, Landlord shall have the following rights and remedies
in addition to any other rights or remedies available to Landlord at law or in
equity:
(a) The rights and remedies provided for by California Civil Code
Section 1951.2, including but not limited to, recovery of the worth at the time
of award of the amount by which the unpaid rent for the balance of the term
after the time of award exceeds the amount of
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rental loss for the same period that Tenant proves could be reasonably avoided,
as computed pursuant to subsection (b) of said Section 1951.2. Any proof by
Tenant under subparagraphs (2) and (3) of Section 1951.2 of the California Civil
Code of the amount of rental loss that could be reasonably avoided shall be made
in the following manner: Landlord and Tenant shall each select a licensed real
estate broker in the business of renting property of the same type and use as
the Premises and in the same geographic vicinity. Such two real estate brokers
shall select a third licensed real estate broker, and the three licensed real
estate brokers so selected shall determine the amount of the rental loss that
could be reasonably avoided from the balance of the term of this Lease after the
time of award. The decision of the majority of said licensed real estate brokers
shall be final and binding upon the parties hereto.
(b) The rights and remedies provided by California Civil Code
Section which allows Landlord to continue the Lease in effect and to enforce all
of its rights and remedies under this Lease, including the right to recover rent
as it becomes due, for so long as Landlord does not terminate Tenant's right to
possession; acts of maintenance or preservation, efforts to relet the Premises,
or the appointment of a receiver upon Landlord's initiative to protect its
interest under this Lease shall not constitute a termination of Tenant's right
to possession.
(c) The right to terminate this Lease by giving notice to Tenant in
accordance with applicable law.
(d) To the extent permitted by law the right and power, to enter
the Premises and remove therefrom all persons and property, to store such
property in a public warehouse or elsewhere at the cost of and for the account
of Tenant, and to sell such property and apply such proceeds therefrom pursuant
to applicable California law, Landlord may from time to time sublet the Premises
or any part thereof for such term or terms (which may extend beyond the term of
this Lease) and at such rent and such other terms as Landlord in its sole
discretion may deem advisable, with the right to make alterations and repairs to
the Premises. Upon each subletting, (i) Tenant shall be immediately liable to
pay Landlord, in addition to indebtedness other than rent due hereunder, the
cost of such subletting, including, but not limited to, reasonable attorneys'
fees, and any real estate commissions actually paid, and the cost of such
alterations and repairs incurred by Landlord and the amount, if any, by which
the rent hereunder for the period of such subletting (to the extent such period
does not exceed the term hereof) exceeds the amount to be paid as rent for the
Premises for such period or (ii) at the option of Landlord, rents received from
such subletting shall be applied first to payment to indebtedness other than
rent due hereunder from Tenant to Landlord; second, to the payment of any costs
of such subletting and of such alterations and repairs; third, to payment of
rent due and unpaid hereunder; and the residue, if any, shall be held by
Landlord and applied in payment of future rent as the same becomes due
hereunder. If Tenant has been credited with any rent to be received by such
subletting under option (i) and such rent shall not be promptly paid to Landlord
by the subtenant(s), or if such rentals received from such subletting under
option (ii) during any month be less than that to be paid during that month by
Tenant hereunder, Tenant shall pay any such deficiency to Landlord. Such
deficiency shall be calculated and paid monthly. No taking possession of the
Premises by Landlord, shall be construed as an election on its part to terminate
this Lease unless a written notice of such intention be given to Tenant.
Notwithstanding any such subletting without termination, Landlord may at any
time hereafter elect to terminate this Lease for such previous breach.
16.
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(e) The right to have a receiver appointed for Tenant upon
application by Landlord, to take possession of the Premises and to apply any
rental collected from the Premises and to exercise all other rights and remedies
granted to Landlord pursuant to subparagraph d. above.
23. ABANDONMENT.
Tenant shall not vacate or abandon the Premises at any time during the
term of this Lease, and if Tenant shall abandon, vacate or surrender said
Premises, or be dispossessed by the process of law, or otherwise, any personal
property belonging to Tenant and left on the Premises shall be deemed to be
abandoned, at the option of Landlord, except such property as may be mortgaged
to Landlord.
24. DESTRUCTION.
In the event the Premises are destroyed in whole or in part from any
cause, except for routine maintenance and repairs and incidental damage and
destruction caused from vandalism and accidents for which Tenant is responsible
for under Paragraph 10, Landlord may, at its option:
A. Rebuild or restore the Premises to their condition prior to the
damage or destruction, or
B. Terminate this Lease (providing that the Premises is damaged to the
extent of 33 1/3% of the replacement cost).
If Landlord does not give Tenant notice in writing within thirty (30)
days from the destruction of the Premises of its election to either rebuild and
restore them, or to terminate this Lease, Landlord shall be deemed to have
elected to rebuild or restore them, in which event Landlord agrees, at its
expense, promptly to rebuild or restore the Premises to their condition prior to
the damage or destruction. Tenant shall be entitled to a reduction in rent while
such repair is being made in the proportion that the area of the Premises
rendered untenantable by such damage bears to the total area of the Premises. If
Landlord initially estimates that the rebuilding or restoration will exceed one
hundred eighty (180) days or if Landlord does not complete the rebuilding or
restoration within one hundred eighty (180) days following the date of
destruction (such period of time to be extended for delays caused by the fault
or neglect of Tenant or because of Acts of God, acts of public agencies, labor
disputes, strikes, fires, freight embargoes, rainy or stormy weather, inability
to obtain materials, supplies or fuels, acts of contractors or subcontractors,
or delay of the contractors or subcontractors due to such causes or other
contingencies beyond the control of Landlord), then Tenant shall have the right
to terminate this Lease by giving fifteen (15) days prior written notice to
Landlord. Notwithstanding anything herein to the contrary, Landlord's obligation
to rebuild or restore shall be limited to the building and interior improvements
constructed by Landlord as they existed as of the commencement date of the Lease
and shall not include restoration of Tenant's trade fixtures, equipment,
merchandise, or any improvements, alterations or additions made by Tenant to the
Premises, which Tenant shall forthwith replace or fully repair at Tenant's sole
cost and expense provided this Lease is not cancelled according to the
provisions above.
17.
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Unless this Lease is terminated pursuant to the foregoing provisions,
this Lease shall remain in full force and effect. Tenant hereby expressly waives
the provisions of Section 1932, Subdivision 2, in Section 1933, Subdivision 4 of
the California Civil Code.
In the event that the building in which the Premises are situated is
damaged or destroyed to the extent of not less than 33 1/3% of the replacement
cost thereof, Landlord may elect to terminate this Lease, whether the Premises
be injured or not. Notwithstanding anything to the contrary herein, Landlord may
terminate this Lease in the event of an uninsured event or if insurance proceeds
are insufficient to cover one hundred percent of the rebuilding costs net of the
deductible.
25. EMINENT DOMAIN.
If all or any part of the Premises shall be taken by any public or
quasi-public authority under the power of eminent domain or conveyance in lieu
thereof, this Lease shall terminate as to any portion of the Premises so taken
or conveyed on the date when title vests in the condemnor, and Landlord shall be
entitled to any and all payment, income, rent, award, or any interest therein
whatsoever which may be paid or made in connection with such taking or
conveyance, and Tenant shall have no claim against Landlord or otherwise for the
value of any unexpired term of this Lease. Notwithstanding the foregoing
paragraph, any compensation specifically awarded Tenant for loss of business,
Tenant's personal property, moving cost or loss of goodwill, shall be and remain
the property of Tenant.
If (i) any action or proceeding is commenced for such taking of the
Premises or any part thereof, or if Landlord is advised in writing by any entity
or body having the right or power of condemnation of its intention to condemn
the premises or any portion thereof, or (ii) any of the foregoing events occur
with respect to the taking of any space in the Complex not leased hereby, or if
any such spaces so taken or conveyed in lieu of such taking and Landlord shall
decide to discontinue the use and operation of the Complex, or decide to
demolish, alter or rebuild the Complex, then, in any of such events Landlord
shall have the right to terminate this Lease by giving Tenant written notice
thereof within sixty (60) days of the date of receipt of said written advice, or
commencement of said action or proceeding, or taking conveyance, which
termination shall take place as of the first to occur of the last day of the
calendar month next following the month in which such notice is given or the
date on which title to the Premises shall vest in the condemnor.
In the event of such a partial taking or conveyance of the Premises, if
the portion of the Premises taken or conveyed is so substantial that the Tenant
can no longer reasonably conduct its business, Tenant shall have the privilege
of terminating this Lease within sixty (60) days from the date of such taking or
conveyance, upon written notice to Landlord of its intention so to do, and upon
giving of such notice this Lease shall terminate on the last day of the calendar
month next following the month in which such notice is given, upon payment by
Tenant of the rent from the date of such taking or conveyance to the date of
termination.
If a portion of the Premises be taken by condemnation or conveyance in
lieu thereof and neither Landlord nor Tenant shall terminate this Lease as
provided herein, this Lease shall continue in full force and effect as to the
part of the Premises not so taken or conveyed, and the
18.
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rent herein shall be apportioned as of the date of such taking or conveyance so
that thereafter the rent to be paid by Tenant shall be in the ratio that the
area of the portion of the Premises not so taken or conveyed bears to the total
area of the Premises prior to such taking.
26. SALE OR CONVEYANCE BY LANDLORD.
In the event of a sale or conveyance of the Complex or any interest
therein, by any owner of the reversion then constituting Landlord, the
transferor shall thereby be released from any further liability upon any of the
terms, covenants or conditions (express or implied) herein contained in favor of
Tenant, and in such event, insofar as such transfer is concerned. Tenant agrees
to look solely to the responsibility of the successor in interest of such
transferor in and to the Complex and this Lease for all obligations thereafter
arising. This Lease shall not be affected by any such sale or conveyance, and
Tenant agrees, upon recognition, to attorn to the successor in interest of such
transferor.
27. ATTORNMENT TO LENDER OR THIRD PARTY.
In the event the interest of Landlord in the land and buildings in which
the leased Premises are located (whether such interest of Landlord is a fee
title interest or a leasehold interest is encumbered by deed of trust, and such
interest is acquired by the lender or any third party through judicial
foreclosure or by exercise of a power of sale at private trustee's foreclosure
sale. Tenant hereby agrees, upon recognition, to attorn to the purchaser at any
such foreclosure sale and to recognize such purchaser as the Landlord under this
Lease. In the event the lien of the deed of trust securing the loan from a
Lender to Landlord is prior and paramount to the Lease, this Lease shall
nonetheless continue in full force and effect for the remainder of the unexpired
term hereof, at the same rental herein reserved and upon all the other terms,
conditions and covenants herein contained.
28. HOLDING OVER.
Any holding over by Tenant after expiration or other termination of the
term of this Lease with the written consent of Landlord delivered to Tenant
shall not constitute a renewal or extension of the Lease or give Tenant any
rights in or to the leased Premises except as expressly provided in this Lease.
Any holding over after the expiration or other termination of the term of this
Lease, with the consent of Landlord, shall be construed to be a tenancy from
month to month, on the same terms and conditions herein specified insofar as
applicable except that the monthly Basic Rent shall be increased to an amount
equal to one hundred fifty (150%) percent of the monthly Basic Rent required
during the last month of the Lease term.
29. CERTIFICATE OF ESTOPPEL.
Tenant shall at any time upon not less than ten (10) days' prior written
notice to Landlord execute, acknowledge and deliver to Landlord a statement in
writing (i) certifying that this Lease is unmodified and in full force and
effect (or, if modified, stating the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect) and the date to
which the rent and other charges are paid in advance, if any, and (ii)
acknowledging that there are not, to Tenant's knowledge, any uncured defaults on
the part of Landlord hereunder, or specifying such defaults, if any, are
claimed. Any such statement may be conclusively relied upon by any
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prospective purchaser or encumbrancer of the Premises. Tenant's failure to
deliver such statement within such time shall be conclusive upon Tenant that
this Lease is in full force and effect, without modification except as may be
represented by Landlord; that there are no uncured defaults in Landlord's
performance, and that not more than one month's rent has been paid in advance.
30. CONSTRUCTION CHANGES.
It is understood that the description of the Premises and the location
of ductwork, plumbing and other facilities therein are subject to such minor
changes as Landlord or Landlord's architect determines to be desirable in the
course of construction of the Premises, and no such changes, or any changes in
plans for any other portions of the Complex shall affect this Lease or entitle
Tenant to any reduction of rent hereunder or result in any liability of Landlord
to Tenant. Landlord does not guarantee the accuracy of any drawings supplied to
Tenant and verification of the accuracy of such drawings rests with Tenant.
31. RIGHT OF LANDLORD TO PERFORM.
All terms, covenants and conditions of this Lease to be performed or
observed by Tenant shall be performed or observed by Tenant at Tenant's sole
cost and expense and without any reduction of rent. If Tenant shall fail to pay
any sum of money, or other rent, required to be paid by it hereunder and such
failure shall continue for five (5) days after written notice thereof by
Landlord, or shall fail to perform any other term or covenant hereunder on its
part to be performed, and such failure shall continue for thirty (30) days after
written notice thereof by Landlord, Landlord, without waiving or releasing
Tenant from any obligation of Tenant hereunder, may, but shall not be obligated
to, make any such payment or perform any such other term or covenant on Tenant's
part to be performed. All sums so paid by Landlord and all necessary costs of
such performance by Landlord together with interest thereon at the rate of the
prime rate of interest per annum as quoted by the Bank of America from the date
of such payment or performance by Landlord, shall be paid (and Tenant covenants
to make such payment) to Landlord on demand by Landlord, and Landlord shall have
(in addition to any other right or remedy of Landlord) the same rights and
remedies in the event of nonpayment by Tenant as in the case of failure by
Tenant in the payment of rent hereunder.
32. ATTORNEYS' FEES.
A. In the event that either Landlord or Tenant should bring suit for the
possession of the Premises, for the recovery of any sum due under this Lease, or
because of the breach of any provision of this Lease, or for any other relief
against the other party hereunder, then all costs and expenses, including
reasonable attorneys' fees, incurred by the prevailing party therein shall be
paid by the other party, which obligation on the part of the other party shall
be deemed to have accrued on the date of the commencement of such action and
shall be enforceable whether or not the action is prosecuted to judgment.
B. Should Landlord be named as a defendant in any suit brought against
Tenant in connection with or arising out of Tenant's occupancy hereunder, Tenant
shall pay to Landlord its costs and expenses incurred in such suit, including a
reasonable attorney's fee.
20.
<PAGE> 58
33. WAIVER.
The waiver by either party of the other party's failure to perform or
observe any term, covenant or condition herein contained to be performed or
observed by such waiving party shall not be deemed to be a waiver of such term,
covenant or condition or of any subsequent failure of the party failing to
perform or observe the same or any other such term, covenant or condition
therein contained, and no custom or practice which may develop between the
parties hereto during the term hereof shall be deemed a waiver of, or in any way
affect, the right of either party to insist upon performance and observance by
the other party in strict accordance with the terms hereof.
34. NOTICES.
All notices, demands, requests, advices or designations which may be or
are required to be given by either party to the other hereunder shall be in
writing. All notices, demands, requests, advices or designations by Landlord to
Tenant shall be sufficiently given, made or delivered if personally served on
Tenant by leaving the same at the Premises or if sent by United States certified
or registered mail, postage prepaid, addressed to Tenant at the Premises. all
notices demands, requests, advices or designations by Tenant to Landlord shall
be sent by United States certified or registered mail, postage prepaid,
addressed to Landlord at its offices at Westport Joint Venture, 2560 Mission
College Blvd., #101, Santa Clara, CA 95054. Each notice, request, demand, advice
or designation referred to in this paragraph shall be deemed received on the
date of the personal service or mailing thereof in the manner herein provided,
as the case may be.
35. EXAMINATION OF LEASE.
Submission of this instrument for examination or signature by Tenant
does not constitute a reservation of or option for a lease, and this instrument
is not effective as a lease or otherwise until its execution and delivery by
both Landlord and Tenant.
36. DEFAULT BY LANDLORD.
Landlord shall not be in default unless Landlord fails to perform
obligations required of Landlord within a reasonable time, but in no event
earlier than thirty (30) days after written notice by Tenant to Landlord and to
the holder of any first mortgage or deed of trust covering the Premises whose
name and address shall have heretofore been furnished to Tenant in writing,
specifying wherein Landlord has failed to perform such obligations; provided,
however, that if the nature of Landlord's obligations is such that more than
thirty (30) days are required for performance, then Landlord shall not be in
default if Landlord commences performance within such thirty (30) day period and
thereafter diligently prosecutes the same to completion.
37. CORPORATE AUTHORITY.
If Tenant is a corporation, (or a partnership) each individual executing
this Lease on behalf of said corporation (or partnership) represents and
warrants that he is duly authorized to execute and deliver this Lease on behalf
of said corporation (or partnership) in accordance with the by-laws of said
corporation (or partnership in accordance with the partnership agreement)
21.
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and that this Lease is binding upon said corporation (or partnership) in
accordance with its terms. If Tenant is a corporation, Tenant shall, within
thirty (30) days after execution of this Lease, deliver to Landlord a certified
copy of the resolution of the Board of Directors of said corporation authorizing
or ratifying the execution of this Lease.
38. LIMITATION OF LIABILITY.
In consideration of the benefits accruing hereunder. Tenant and all
successors and assigns covenant and agree that, in the event of any actual or
alleged failure, breach or default hereunder by Landlord:
A. the sole and exclusive remedy shall be against Landlord's interest in
the Premises leased herein;
B. no partner of Landlord shall be sued or named as a party in any suit
or action (except as may be necessary to secure jurisdiction of the
partnership);
C. no service of process shall be made against any partner of Landlord
(except as may be necessary to secure jurisdiction of the partnership);
D. no partner of Landlord shall be required to answer or otherwise plead
to any service of process;
E. no judgment will be taken against any partner of Landlord;
F. any judgment taken against any partner of Landlord may be vacated and
set aside at any time without hearing;
G. no writ of execution will ever be levied against the assets of any
partner of Landlord;
H. these covenants and agreements are enforceable both by Landlord and
also by any partner of Landlord.
Tenant agrees that each of the foregoing covenants and agreements shall
be applicable to any covenant or agreement either expressly contained in this
Lease or imposed by statute or at common law.
39. MISCELLANEOUS AND GENERAL PROVISIONS.
A. Tenant shall not, without the written consent of Landlord, use the
name of the building for any purpose other than as the address of the business
conducted by Tenant in the Premises.
B. This Lease shall in all respects be governed by and construed in
accordance with the laws of the State of California. If any provision of this
Lease shall be invalid, unenforceable or ineffective for any reason whatsoever,
all other provisions hereof shall be and remain in full force and effect.
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C. The term "Premises" includes the space leased hereby and any
improvements now or hereafter installed therein or attached thereto. The term
"Landlord" or any pronoun used in place thereof includes the plural as well as
the singular and the successors and assigns of Landlord. The term "Tenant" or
any pronoun used in place thereof includes the plural as well as the singular
and individuals, firms, associations, partnerships and corporations, and their
and each of their respective heirs, executors, administrators, successors and
permitted assigns, according to the context hereof, and the provisions of this
Lease shall inure to the benefit of and bind such heirs, executors,
administrators, successors and permitted assigns.
The term "person" includes the plural as well as the singular and
individuals, firms, associations, partnerships and corporations. Words used in
any gender include other genders. If there be more than one Tenant the
obligations of Tenant hereunder are joint and several. The paragraph headings of
this Lease are for convenience of reference only and shall have no effect upon
the construction or interpretation of any provision hereof.
D. Time is of the essence of this Lease and of each and all of its
provisions.
E. At the expiration or earlier termination of this Lease, Tenant shall
execute, acknowledge and deliver to Landlord, within ten (10) days after written
demand from Landlord to Tenant, any quitclaim deed or other document required by
any reputable title company, licensed to operate in the State of California, to
remove the cloud or encumbrance created by this Lease from the real property of
which Tenant's Premises are a part.
F. This instrument along with any exhibits and attachments hereto
constitutes the entire agreement between Landlord and Tenant relative to the
Premises and this agreement and the exhibits and attachments may be altered,
amended or revoked only by an instrument in writing signed by both Landlord and
Tenant. Landlord and Tenant agree hereby that all prior or contemporaneous oral
agreements between and among themselves and their agents or representatives
relative to the leasing of the Premises are merged in or revoked by this
agreement.
G. Neither Landlord nor Tenant shall record this Lease or a short form
memorandum hereof without the consent of the other.
H. Tenant further agrees to execute any amendments required by the
lender to enable Landlord to obtain financing, so long as Tenant's rights
hereunder are not substantially affected.
I. Paragraphs 43 through 59 are added hereto and are included as a part
of this lease.
J. Clauses, plats and riders, if any, signed by Landlord and Tenant and
endorsed on or affixed to this Lease are a part hereof.
K. Tenant covenants and agrees that no diminution or shutting off of
light, air or view by any structure which may be hereafter erected (whether or
not by Landlord) shall in any way affect his Lease, entitle Tenant to any
reduction of rent hereunder or result in any liability of Landlord to Tenant.
23.
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40. BROKERS.
Tenant warrants that it had dealings with only the following real estate
brokers or agents in connection with the negotiation of this Lease: none, and
that it knows of no other real estate broker or agent who is entitled to a
commission in connection with this Lease.
41. SIGNS.
No sign, placard, picture, advertisement, name or notice shall be
inscribed, displayed or printed or affixed on or to any part of the outside of
the Premises or any exterior windows of the Premises without the written consent
of Landlord first had and obtained and Landlord shall have the right to remove
any such sign, placard, picture, advertisement, name or notice without notice to
and at the expense of Tenant. If Tenant is allowed to print or affix or in any
way place a sign in, on, or about the Premises, upon expiration or other sooner
termination of this Lease. Tenant at Tenant's sole cost and expense shall both
remove such sign and repair all damage in such a manner as to restore all
aspects of the appearance of the Premises to the condition prior to the
placement of said sign.
All approved signs or lettering on outside doors shall be printed,
painted, affixed or inscribed at the expense of Tenant by a person approved of
by Landlord.
Tenant shall not place anything or allow anything to be placed near the
glass of any window, door partition or wall which may appear unsightly from
outside the Premises.
IN WITNESS WHEREOF, Landlord and Tenant have executed and delivered this
Lease as of the day and year last written below.
LANDLORD: TENANT:
WESTPORT JOINT VENTURE IPASS, INC.
a California joint venture a California corporation
John Arrillaga Survivor's Trust
By: /s/ JOHN ARRILLAGA By: /s/ MICHAEL H. MANSOURI
-------------------------------- --------------------------------------
John Arrillaga, Trust
Date: November 29, 1999 Title: Chairman & Chief Executive Officer
------------------------------ -----------------------------------
PEERY PRIVATE INVESTMENT COMPANY-WP,
L.P.
a California limited partnership Print or Type Name: Michael H. Mansouri
----------------------
By: /s/ RICHARD T. PEERY Date: November 23, 1999
- ----------------------------------- ------------------------------------
Richard T. Peery, Trustee of the
24.
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Richard T. Peery Separate Property
Trust dated 7/20/77, as its General
Partner
Date: November 24, 1999
--------------------------------------
PEERY PUBLIC INVESTMENT COMPANY-WP, L.P.
a California limited partnership
By: /s/ RICHARD T. PEERY
----------------------------------------
Richard T. Peery, Trustee of the
Richard T. Peery Separate Property
Trust dated 7/20/77, as its General
Partner
Date: November 24, 1999
--------------------------------------
Paragraphs 43 through 59 to Lease Agreement dated October 26, 1999, By and
Between Westport Joint Venture, a California joint venture, as Landlord, and
iPass, Inc., a California corporation, as Tenant for 48,384+ Square Feet of
Space Located at 3600 Bridge Parkway, Redwood City, California.
42. BASIC RENT.
In accordance with Paragraph 4A herein, the total aggregate sum of
TWENTY FIVE MILLION SEVEN HUNDRED EIGHTY FIVE THOUSAND SEVEN HUNDRED FIFTY TWO
AND 28/100 DOLLARS ($25,785,752.28), shall be payable as follows:
On February 15, 2000, the sum of NINETY THREE THOUSAND EIGHT HUNDRED
FORTY EIGHT AND 28/100 DOLLARS ($93,848.28) shall be due, representing the
prorated Basic Rent for the period of February 15, 2000 through February 29,
2000.
On March 1, 2000, the sum of ONE HUNDRED EIGHTY ONE THOUSAND FOUR
HUNDRED FORTY AND NO/100 DOLLARS ($181,440.00) shall be due, and a like sum due
on the first day of each month thereafter, through and including February 1,
2001.
On March 1, 2001, the sum of ONE HUNDRED EIGHTY EIGHT THOUSAND SIX
HUNDRED NINETY SEVEN AND 60/100 DOLLARS ($188,697.60) shall be due, and a like
sum due on the first day of each month thereafter, through and including
February 1, 2002.
On March 1, 2002, the sum of ONE HUNDRED NINETY FIVE THOUSAND NINE
HUNDRED FIFTY FIVE AND 20/100 DOLLARS ($195,955.20) shall be due, and a like sum
due on the first day of each month thereafter, through and including February 1,
2003.
25.
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On March 1, 2003, the sum of TWO HUNDRED THREE THOUSAND TWO HUNDRED
TWELVE AND 80/100 DOLLARS ($203,212.80) shall be due, and a like sum due on the
first day of each month thereafter, through and including February 1, 2004.
On March 1, 2004, the sum of TWO HUNDRED TEN THOUSAND FOUR HUNDRED
SEVENTY AND 40/100 DOLLARS ($210,470.40) shall be due, and a like sum due on the
first day of each month thereafter, through and including February 1, 2005.
On March 1, 2005, the sum of TWO HUNDRED SEVENTEEN THOUSAND SEVEN
HUNDRED TWENTY EIGHT AND NO/100 DOLLARS ($217,728.00) shall be due, and a like
sum due on the first day of each month thereafter, through and including
February 1, 2006.
On March 1, 2006, the sum of TWO HUNDRED TWENTY FOUR THOUSAND NINE
HUNDRED EIGHT FIVE AND 60/ 100 DOLLARS ($224,985.60) shall be due, and a like
sum due on the first day of each month thereafter, through and including
February 1, 2007.
On March 1, 2007, the sum of TWO HUNDRED THIRTY TWO THOUSAND TWO HUNDRED
FORTY THREE AND 20/100 DOLLARS ($232,243.20) shall be due, and a like sum due on
the first day of each month thereafter, through and including February 1, 2008.
On March 1, 2008, the sum of TWO HUNDRED THIRTY NINE THOUSAND FIVE
HUNDRED AND 80/100 DOLLARS ($239,500.80) shall be due, and a like sum due on the
first day of each month thereafter, through and including February 1, 2009.
On March 1, 2009, the sum of TWO HUNDRED FORTY SIX THOUSAND SEVEN
HUNDRED FIFTY EIGHT AND 40/100 DOLLARS ($246,758.40) shall be due, and a like
sum due on the first day of each month thereafter, through and including
February 1, 2010; or until the entire aggregate sum of TWENTY FIVE MILLION SEVEN
HUNDRED EIGHTY FIVE THOUSAND SEVEN HUNDRED FIFTY TWO AND 28/100 DOLLARS
($25,785.752.28) has been paid.
43. "AS-IS" BASIS.
Subject only to Paragraph 45 and to Landlord making the improvements
shown on Exhibit B to be attached hereto, it is hereby agreed that the Premises
leased hereunder is leased strictly on an "as-is" basis and in its present
condition, and in the configuration as shown on Exhibit B to be attached hereto,
and by reference made a part hereof. Except as noted herein, it is specifically
agreed between the parties that after Landlord makes the interior improvements
as shown on Exhibit B, Landlord shall not be required to make, nor be
responsible for any cost, in connection with any repair, restoration, and/or
improvement to the Premises in order for this Lease to commence, or thereafter,
throughout the Term of this Lease. Notwithstanding anything to the contrary
within this Lease, Landlord makes no warranty or representation of any kind or
nature whatsoever as to the condition or repair of the Premises, nor as to the
use or occupancy which may be made thereof.
26.
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44. TENANT INTERIOR IMPROVEMENTS.
Landlord shall, at its sole cost and expense, construct certain interior
improvements (the "Tenant Improvements") in the Premises, as shown on Exhibit B
to be attached to the Lease and Landlord agrees to deliver the Premises leased
hereunder to Tenant, at Landlord's expense, in the configuration shown in Red on
Exhibit B to be attached hereto. Notwithstanding anything to the contrary above,
it is specifically understood and agreed that Landlord shall be required to
furnish only a standard air conditioning/heating system, normal electrical
outlets, standard fire sprinkler systems, standard bathroom, standard lobby, 2'
x 4' suspended acoustical tile drop ceiling throughout the entire space leased,
carpeting and/or vinyl-coated floor tile, and standard office partitions and
doors, as shown on Exhibit B to be attached hereto; provided however, that any
special HVAC and/or plumbing and/or electrical requirements over and above that
normally supplied by Landlord shall be 100 percent the responsibility of and be
paid for 100 percent by Tenant.
It is further agreed that Tenant shall furnish Landlord with Tenant's
required specifications and a preliminary space plan showing the layout of the
improvements to be constructed in the Premises by November 15, 1999. At that
time, Landlord shall have the final interior plans drawn by Landlord's
architect. all of the plans and specifications shall be Exhibit B to this Lease.
If said preliminary plans and specifications for any items affecting the
interior improvements to be constructed in the building are not received by
Landlord for Landlord's approval (which approval shall not be unreasonably
withheld) by November 15, 1999, then it is agreed that, notwithstanding anything
to the contrary in this Lease, this Lease and Tenant's obligation to perform all
terms, covenants and conditions of this Lease shall commence February 15, 2000,
regardless of whether or not the building and interior improvements are
completed on February 15, 2000, and Landlord shall complete construction of the
interior improvements as soon as reasonably possible thereafter.
Notwithstanding anything to the contrary, it is agreed that in the event
Tenant makes changes, additions, or modifications to the plans and
specifications to be constructed by Landlord as set forth herein, or
improvements are installed for Tenant in excess of those to be provided Tenant
by Landlord as set forth on Exhibit B, any increased cost(s) resulting from said
changes, additions, and/or modifications and/or improvements in excess of those
to be provided Tenant shall be contracted for with landlord and paid for one
hundred percent (100%) by Tenant.
The interior shall be constructed in accordance with Exhibit B of the
Lease, it being agreed, however, that if the interior improvements constructed
by landlord relating thereto, do not conform exactly to the plans and
specifications as set forth in the Lease, and the general appearance, structural
integrity, and Tenant's uses and occupancy of the Premises and interior
improvements relating thereto are not materially or unreasonably affected by
such deviation, it is agreed that the commencement date of the Lease, and
Tenant's obligation to pay rental, shall not be affected, and Tenant hereby
agrees, in such event to accept the Premises and interior improvements as
constructed by Landlord.
Tenant shall have thirty (30) days after the Commencement Date to
provide Landlord with a "punch list" pertaining to Landlord's work with respect
to Tenant's interior improvements. As soon as reasonably possible thereafter,
Landlord, or one of Landlord's
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representatives (if so approved by landlord), and Tenant shall conduct a joint
walk-through of the Premises (if Landlord so requires), and inspect such Tenant
Improvements, using their best efforts to agree on the incomplete or defective
construction related to the Tenant Improvements installed by Landlord. After
such inspection has been completed, Landlord shall prepare, and both parties
shall sign, a list of all "punch list" items which the parties reasonably agree
are to be corrected by Landlord (but which shall exclude any damage defects
caused by Tenant, its employees, agents or parties Tenant has contracted with to
work on the Premises). Landlord shall have thirty (30) days thereafter (or
longer if necessary, provided Landlord is diligently pursuing the completion of
the same) to complete, at Landlord's expense, the repairs on the "punch list"
without the Commencement Date of the Lease and Tenant's obligation to pay Rental
thereunder being affected. This Paragraph shall be of no force and effect if
Tenant shall fail to give any such notice to Landlord within thirty (30) days
after the Commencement Date of this Lease.
45. CONSENT.
Whenever the consent of one party to the other is required hereunder,
such consent shall not be unreasonably withheld.
46. CHOICE OF LAW: SEVERABILITY.
This Lease shall in all respects be governed by and construed in
accordance with the laws of the State of California. If any provisions of this
Lease shall be invalid, unenforceable, or ineffective for any reason whatsoever,
all other provisions hereof shall be and remain in full force and effect.
47. AUTHORITY TO EXECUTE.
The parties executing this Lease Agreement hereby warrant and represent
that they are properly authorized to execute this Lease Agreement and bind the
parties on behalf of whom they execute this Lease Agreement and to all of the
terms, covenants and conditions of this Lease Agreement as they relate to the
respective parties hereto.
48. ASSESSMENT CREDITS.
The demised property herein may be subject to a special assessment
levied by the City of Redwood City as part of an Improvement District. As a part
of said special assessment proceedings (if any), additional bonds were or may be
sold and assessments were or may be levied to provide for construction
contingencies and reserve funds. Interest shall be earned on such funds created
for contingencies and on reserve funds which will be credited for the benefit of
said assessment district. to the extent surpluses are created in said district
through unused contingency funds, interest earnings or reserve funds, such
surpluses shall be deemed the property of Landlord. Notwithstanding that such
surpluses may be credited on assessments otherwise due against the Leased
Premises, Tenant shall pay to Landlord, as additional rent if, and at the time
of any such credit of surpluses, an amount equal to all such surpluses so
credited. For example: If (i) the property is subject to an annual assessment of
$1,000.00, and (ii) a surplus of $200.00 is credited towards the current year's
assessment which reduces the
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assessment amount shown on the property tax bill from $1,000.00 to $800.00,
Tenant shall, upon receipt of notice from Landlord, pay to Landlord said $200.00
credit as Additional Rent.
49. ASSIGNMENT AND SUBLETTING (CONTINUED).
A. In addition to and notwithstanding anything to the contrary in
Paragraph 19 of this Lease and provided Tenant is not in default of this Lease,
Landlord hereby agrees to consent to: (1) Tenant's assigning or subletting said
Lease to: (i) any parent or subsidiary corporation, or corporation with which
Tenant merges or consolidates provided that the net worth of said parent or
subsidiary corporation, or said corporation has a net worth equal to or greater
than the net worth of Tenant (a) at the time of Lease execution or (b) at the
time of such assignment, merger, or consolidation (whichever is greater); or
(ii) any third party or entity to whom Tenant sells all or substantially all of
its assets; provided, that the net worth or the resulting or acquiring
corporation has a net worth after the merger, consolidation or acquisition equal
to or greater than the net worth of Tenant (a) at the time of Lease execution or
(b) at the time of such merger, consolidation or acquisition, whichever is
greater (collectively "Permitted Transfers"); (2) waive its right to terminate
the Lease due to a Permitted Transfer; and (3) waive any rights to Excess Rent
related to a Permitted Transfer. No such assignment or subletting will release
the Tenant from its liability and responsibility under this Lease to the extent
Tenant continues in existence following such transaction. Notwithstanding the
above, Tenant shall be required to (a) give Landlord written notice prior to
such assignment or subletting to any party as described in (i) and (ii) above,
(b) execute Landlord's consent document prepared by Landlord reflecting the
assignment or subletting and (c) pay Landlord's costs for processing said
Consent prior to the effective date of said assignment or sublease.
B. Landlord hereby acknowledges that, during the first three years of
the Lease Term, Tenant intends to sublease all or a portion of the Leased
Premises. Provided Tenant is not in default of this Lease and the prospective
subtenant(s) use complies with the requirements of the "use" as stated in
Paragraph 1, Landlord agrees that it will not exercise its right, as provided
for in Paragraph 19, to terminate the Lease as a result of Tenant's initial
request(s) to sublease all or a portion of the Premises for a sublease term(s)
not to extend beyond February 14, 2003. In each such event, Landlord agrees to
issue Landlord's standard consent to said sublease, subject to (a) Tenant
submitting to Landlord a copy of said sublease(s) (prior to said sublease
commencing), (b) Landlord, Tenant and Subtenant(s) thereafter executing
Landlord's standard Consent to Sublease agreement and (c) Landlord receiving
payment from Tenant of Landlord's costs for processing said Sublease Consent(s)
prior to said sublease commencing.
C. Notwithstanding the foregoing, Landlord and Tenant agree that it
shall not be unreasonable for Landlord to refuse to consent to a proposed
assignment, sublease or other transfer ("Proposed Transfer") if the Premises or
any other portion of the Property would become subject to additional or
different Government Requirements as a direct or indirect consequence of the
Proposed Transfer and/or the Proposed Transferee's use and occupancy of the
Premises and the Property. However, Landlord may, in its sole discretion,
consent to such a Proposed Transfer where Landlord is indemnified by Tenant and
(i) Subtenant or (ii) Assignee, in form and substance satisfactory to Landlord's
counsel, by Tenant and/or the Proposed Transferee from and against any and all
costs, expenses, obligations and liability arising out of the Proposed Transfer
and/or the Proposed Transferee's use and occupancy of the Premises and the
Property.
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D. Any and all sublease agreement(s) between Tenant and any and all
subtenant(s) (which agreements must be consented to by Landlord, pursuant to the
requirements of this Lease) shall contain the following language:
"If Landlord and Tenant jointly and voluntarily elect, for any
reason whatsoever, to terminate the Master Lease prior to the scheduled
Master Lease termination date, then this Sublease (if then still in
effect) shall terminate concurrently with the termination of the Master
Lease. Subtenant expressly acknowledges and agrees that (1) the
voluntary termination of the Master Lease by Landlord and Tenant and the
resulting termination of this Sublease shall not give Subtenant any
right or power to make any legal or equitable claim against Landlord,
including without limitation any claim for interference with contract or
interference with prospective economic advantage, and (2) Subtenant
hereby waives any and all rights it may have under law or at equity
against Landlord to challenge such an early termination of the Sublease,
and unconditionally releases and relieves Landlord, and its officers,
directors, employees and agents, from any and all claims, demand, and/or
causes of action whatsoever (collectively, "Claims"), whether such
matters are known or unknown, latent or apparent, suspected or
unsuspected, foreseeable or unforeseeable, which Subtenant may have
arising out of or in connection with any such early termination of this
Sublease. Subtenant knowingly and intentionally waives any and all
protection which is or may be given by Section 1542 of the California
Civil Code which provides as follows: "A general release does not extend
to claims which the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if known by him must
have materially affected his settlement with debtor.
The term of this Sublease is therefore subject to early
termination. Subtenant's initials here below evidence (a) Subtenant's
consideration of and agreement to this early termination provision, (b)
Subtenant's acknowledgment that, in determining the net benefits to be
derived by Subtenant under the terms of this Sublease, Subtenant has
anticipated the potential for early termination, and (c) Subtenant's
agreement to the general waiver and release of Claims above.
Initials: _________ Initials:_________"
Subtenant Tenant
50. BANKRUPTCY AND DEFAULT.
Paragraph 22 is modified to provide that with respect to non-monetary
defaults not involving Tenant's failure to pay Basic Rent or Additional Rent,
Tenant shall not be in default of any non-monetary obligation if (i) more than
thirty (30) days is required to cure such non-monetary default, and (ii) Tenant
commences cure of such default as soon as reasonably practicable after receiving
written notice of such default from Landlord and thereafter continuously and
with due diligence prosecutes such cure to completion.
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51. ABANDONMENT.
Paragraph 23 is modified to provide that Tenant shall not be in default
under the Lease if it leaves all or any part of Premises vacant so long as (i)
Tenant is performing all of its other obligations under the Lease including the
obligation to pay Basic Rent and Additional Rent (ii) Tenant provides on-site
security during normal business hours for those parts of the Premises left
vacant, (iii) such vacancy does not materially and adversely affect the validity
or coverage of any policy of insurance carried by Landlord with respect to the
Premises, and (iv) the utilities and heating and ventilation system are operated
and maintained to the extent necessary to prevent damage to the Premises or its
systems.
52. HAZARDOUS MATERIALS.
Landlord and Tenant agree as follows with respect to the existence or
use of "Hazardous Materials" (as defined herein) on, in, under or about the
Premises and real property located beneath said Premises and the common areas of
the Complex (hereinafter collectively referred to as the "Property"):
A. As used herein, the term "Hazardous Materials" shall mean any
material, waste, chemical, mixture or byproduct which is or hereafter is
defined, listed or designated under Environmental Laws (defined below) as a
pollutant, or as a contaminant, or as a toxic or hazardous substance, waste or
material, or any other unwholesome, hazardous, toxic, biohazardous, or
radioactive material, waste, chemical, mixture or byproduct, or which is listed,
regulated or restricted by any Environmental Law (including, without limitation,
petroleum hydrocarbons or any distillates or derivatives or fractions thereof,
polychlorinated biphenyls, or asbestos). As used herein, the term "Environmental
Laws" shall mean any applicable Federal, State of California or local government
law (including common law), statute, regulation, rule, ordinance, permit,
license, order requirement, agreement or approval, or any determination,
judgment, directive, or order of any executive or judicial authority at any
level of Federal, State of California or local government (whether now existing
or subsequently adopted or promulgated) relating to pollution or the protection
of the environment, ecology, natural resources, or public health and safety.
B. Tenant shall obtain Landlord's written consent, which may be withheld
in Landlord's discretion, prior to the occurrence of any Tenant's Hazardous
Materials Activities (defined below); provided, however, that Landlord's consent
shall not be required for normal use in compliance with applicable Environmental
Laws of customary household and office supplies (Tenant shall first provide
Landlord with a list of said materials use), such as mild cleaners, lubricants
and copier toner. as used herein, the term "Tenant's Hazardous Materials
Activities" shall mean any and all use, handling, generation, storage, disposal,
treatment, transportation, release, discharge, or emission of any Hazardous
Materials on, in, beneath, to, from, at or about the Property, in connection
with Tenant's use of the Property, or by Tenant or by any of Tenant's agents,
employees, contractors, vendors, invitees, visitors or its future subtenants or
assignees. Tenant agrees that any and all Tenant's Hazardous Materials
Activities shall be conducted in strict, full compliance with applicable
Environmental Laws at Tenant's expense, and shall not
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result in any contamination of the Property or the environment. Tenant agrees to
provide Landlord with prompt written notice of any spill or release of Hazardous
Materials at the Property during the term of the Lease of which Tenant becomes
aware, and further agrees to provide Landlord with prompt written notice of any
violation of Environmental Laws in connection with Tenant's Hazardous Materials
Activities of which Tenant becomes aware. If Tenant's Hazardous Materials
Activities involve Hazardous Materials other than normal use of customary
household and office supplies, Tenant also agrees at Tenant's expense: (i) to
install such Hazardous Materials monitoring, storage and containment devices as
Landlord reasonably deems necessary (Landlord shall have no obligation to
evaluate the need for any such installation or to require any such
installation); (ii) provide Landlord with a written inventory of such Hazardous
Materials, including an update of same each year upon the anniversary date of
the Commencement Date of the Lease ("Anniversary Date"); and (iii) on each
anniversary Date, to retain a qualified environmental consultant, acceptable to
Landlord, to evaluate whether Tenant is in compliance with all applicable
Environmental Laws with respect to Tenant's Hazardous Materials Activities.
Tenant, at its expense, shall submit to Landlord a report from such
environmental consultant which discusses the environmental consultant's findings
within two (2) months of each Anniversary Date. Tenant, at its expense, shall
promptly undertake and complete any and all steps necessary, and in full
compliance with applicable Environmental Laws, to fully correct any and all
problems or deficiencies in connection with Tenant's Hazardous Materials
Activities identified by the environmental consultant, and promptly provide
Landlord with documentation of all such corrections.
C. Prior to termination or expiration of the Lease, Tenant, at its
expense, shall (i) properly remove from the Property all Hazardous Materials
which come to be located at the Property in connection with Tenant's Hazardous
Materials Activities, and (ii) fully comply with and complete all facility
closure requirements of applicable Environmental Laws regarding Tenant's
Hazardous Materials Activities, including but not limited to (x) properly
restoring and repairing the Property to the extent damaged by such closure
activities, and (y) obtaining from the local Fire Department or other
appropriate governmental authority with jurisdiction a written concurrence that
closure has been completed in compliance with applicable Environmental Laws.
Tenant shall promptly provide Landlord with copies of any claims, notices, work
plans, data and reports prepared, received or submitted in connection with any
such closure activities.
D. If Landlord, in its sole discretion, believes that the Property has
become contaminated as a result of Tenant's Hazardous Materials Activities,
Landlord in addition to any other rights it may have under this Lease or under
environmental Laws or other laws, may enter upon the Property and conduct
inspection, sampling and analysis, including but not limited to obtaining and
analyzing samples of soil and groundwater, for the purpose of determining the
nature and extent of such contamination. Tenant shall promptly reimburse
Landlord for the costs of such an investigation, including but not limited to
reasonable attorneys' fees Landlord incurs with respect to such investigation,
that discloses Hazardous Materials contamination for which Tenant is liable
under this Lease. Except as may be required of Tenant by applicable
Environmental Laws. Tenant shall not perform any sampling, testing, or drilling
to identify the presence of any Hazardous materials at the Property, without
landlord's prior written consent which may be withheld in Landlord's discretion.
Tenant shall promptly provide Landlord with copies of any claims, notices, work
plans, data and reports prepared, received or submitted in connection with any
sampling, testing or drilling performed pursuant to the preceding sentence.
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E. Tenant shall indemnify, defend (with legal counsel acceptable to
Landlord, whose consent shall not unreasonably be withheld) and hold harmless
Landlord, its employees, assigns, successors, successors-in-interest, agents and
representatives from and against any and all claims (including but not limited
to third party claims from a private party or a government authority),
liabilities, obligations, losses, causes of action, demands, governmental
proceedings or directors, fines, penalties, expenses, costs (including but not
limited to reasonable attorneys', consultants' and other experts' fees and
costs), and damages, which arise from or relate to: (i) Tenant's Hazardous
Materials Activities; (ii) any Hazardous Materials contamination caused by
Tenant prior to the Commencement Date of the Lease; or (iii) the breach of any
obligation of Tenant under this Paragraph 52 (collectively, "Tenant's
Environmental Indemnification"). Tenant's Environmental Indemnification shall
include but is not limited to the obligation to promptly and fully reimburse
Landlord for losses in or reductions to rental income, and diminution in fair
market value of the Property. Tenant's Environmental Indemnification shall
further include but is not limited to the obligation to diligently and properly
implement to completion, at Tenant's expense, any and all environmental
investigation, removal, remediation, monitoring, reporting, closure activities,
or other environmental response action (collectively "Response Actions"). Tenant
shall promptly provide Landlord with copies of any claims, notices, work plans,
data and reports prepared, received or submitted in connection with any Response
Actions.
F. Landlord hereby informs Tenant, and Tenant hereby acknowledges, that
the Premises and adjacent properties overlie a former solid waste landfill site
commonly known as the Westport Landfill ("Former Landfill"). Landlord further
informs Tenant, and Tenant hereby acknowledges, that (i) prior testing has
detected the presence of low levels of certain volatile and semi-volatile
organic compounds and other contaminants in the groundwater, in the leachate
from the landfilled solid waste, and/or in certain surface waters of the
Property, as more fully described in Section 2.3.2 of the report entitled
"Revised Discharge Monitoring Plan, Westport Landfill Site, Redwood City,
California" prepared by Geomatrix Consultants, dated May 1996 ("Discharge
Plan"), (ii) methane gas is or may be generated by the landfilled solid waste
(item "i" immediately preceding and this item "ii" are hereafter collectively
referred to as the "Landfill Contamination"), and (iii) the Premises and the
Former landfill are subject to the California Regional Water Quality control
Board's ("Regional Board") Waste Discharge Requirements Order No. 94-181 (the
"Order"). The Order is attached hereto as Exhibit C. As evidenced by their
initials set forth immediately below, Tenant acknowledges that Landlord has
provided Tenant with copies of the environmental reports listed on Exhibit D,
and Tenant acknowledges that Tenant and Tenant's experts (if any) have had ample
opportunity to review such reports and that Tenant has satisfied itself as to
the environmental conditions of the Property and the suitability of such
conditions for Tenant's intended use of the Property.
Initials: _________ Initials:_________
Tenant Landlord
G. Landlord shall indemnify, defend, and hold harmless Tenant against
any and all claims asserted by third parties (excluding any agents, employees,
contractors, vendors, invitees, visitors, future subtenants and assignees of
Tenant, and excluding any other parties related to Tenant), including all
liabilities, judgments, damages, suits, orders, government directives, costs and
expenses in connection with such claims, which arise from (i) the Landfill
Contamination, or (ii) the Order, as may be amended ("Landlord's Environmental
Indemnity"); provided however
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that Landlord's Environmental Indemnity shall be subject to the following
limitations and conditions:
(a) Landlord's Environmental Indemnity shall not apply to any
economic or consequential damages suffered by Tenant, including but not limited
to loss of business or profits.
(b) Landlord's Environmental Indemnity shall not apply, without
limitation, to any releases caused by Tenant's Hazardous Materials Activities.
(c) Tenant acknowledges that Landlord must comply with the Order,
as may be amended, and with directives of government authorities including the
Regional Board, with respect to the Contamination and the Former Landfill.
Tenant further acknowledges that groundwater monitoring wells, methane recovery
wells and equipment, and other environmental control devices are located on and
about the Premises and may be modified or added to during the term of the Lease
(collectively, "Environmental Equipment"), and that environmental investigation,
monitoring, closure and post-closure activities (collectively, "Environmental
Activities") will be performed on the Premises during the term of the Lease.
Tenant shall allow Landlord, and any other party named as a discharger under the
Order, as may be amended, and their respective agents, consultants and
contractors, and agents of governmental environmental authorities with
jurisdiction ("Government Representatives") to enter the Premises to access the
Environmental Equipment and to perform Environmental Activities during the term
of the Lease, provided that Tenant's use and occupancy of the Premises shall not
unreasonably be disturbed.
(d) Tenant and Landlord shall reasonably cooperate with each other
regarding any environmental Activities to be performed, and regarding any
Environmental Equipment to be installed, maintained, or removed on the Premises
during the term of the Lease.
(e) Tenant shall be responsible at its expense for repairing any
Environmental Equipment damaged due to the negligence of Tenant or Tenant's
agents, employees, contractors, vendors, invitees, visitors, future subtenants
or assignees (such terms "invitees" and "visitors" as used in this Paragraph 52
shall not include Landlord or any other party named as a discharger under the
Order as may be amended, or any of their respective agents, consultants or
contractors, or any Government Representatives).
It is agreed that the Tenant's responsibilities related to Hazardous Materials
will survive the expiration or termination of this Lease and that Landlord may
obtain specific performance of Tenant's responsibilities under this Paragraph
52.
53. LEASE TERMS CO-TERMINOUS.
It is acknowledged that (i) concurrently with the execution of this
Lease, Landlord and Tenant are also executing a second Lease Agreement dated
October 26, 1999 (hereinafter referred to as the "Building 20 Lease") affecting
adjacent property located at 3800 Bridge Parkway, Redwood city and (ii) it is
the intention of the parties that the term of this Lease be co-terminous with
the term of the Building 20 Lease such that the terms of both leases expire on
the same date; provided, however, the termination of this Lease resulting from
the terms and conditions stated under Paragraph 19 "Bankruptcy and Default"
(subject to landlord's option as
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stated in the respective leases "Cross Default" Paragraph) or paragraph 21
"Destruction" or Paragraph 22 "Eminent Domain" shall not result in a termination
of the Building 20 Lease, unless Landlord elects, at its sole and absolute
discretion, to terminate both of the leases.
54. CROSS DEFAULT.
As a material part of the consideration for the execution of this Lease
by Landlord, it is agreed between landlord and Tenant that a default under this
Lease, or a default under said Building 20 Lease may, at the option of Landlord,
be considered a default under both leases, in which event Landlord shall be
entitled (but in no event required) to apply all rights and remedies of Landlord
under the terms of one lease to both leases including, but not limited to, the
right to terminate one or both of said leases by reason of a default under said
Building 20 Lease or hereunder.
55. ADDITIONAL RENT CONTINUED.
The following items shall be excluded from "Additional Rent".
A. Leasing commissions, attorneys' fees, costs, disbursements, and other
expenses incurred in connection with negotiations with other tenants, or
disputes between Landlord and other third party not related to Tenant
(hereinafter referred to as "Third Party"), or in connection with marketing,
leasing, renovating, or improving space for other current or prospective tenants
or other current or prospective occupants of the Complex; notwithstanding
anything to the contrary herein, any costs and expenses Landlord is entitled to
be reimbursed for as stated under Paragraph 22 (Bankruptcy and Default") are not
excluded Additional Rent items as reflected in this Paragraph 55.
B. The cost of any service sold to any other Third Party or other
occupant whose leased premises are not part of the Premises leased herein and
for which Landlord is entitled to be reimbursed as an additional charge or
rental over and above the basic rent and additional rent payable under the lease
agreement with said other tenant.
C. Any costs, fines, or penalties incurred due to violations by Landlord
of any governmental rule or authority, provided Tenant is not responsible under
the Lease for such costs, fines and/or penalties, and/or provided Tenant's
actions or inactions did not cause, in whole or in part, such costs, fines
and/or penalties.
D. Wages, salaries, or other compensation paid to executive employees
above the grade of Property Manager.
E. Repairs or other work occasioned by fire, windstorm, or other insured
peril, to the extent that Landlord shall receive proceeds of such insurance or
would have received such proceeds had Landlord maintained the insurance coverage
required under this Lease providing said insurance coverage was available and
Tenant paid its share of the premium as required under the Lease and any
insurance deductible(s) which Tenant is responsible for paying and provided
Tenant is not responsible for the damage to the Premises.
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F. Except as otherwise noted in this Lease, any mortgage debt, or ground
rents or any other amounts payable under any ground lease for the Property.
G. Subject to the terms of paragraph 52G above, Landlord's costs related
to Lease Paragraphs 52F and 52G.
56. SECURITY DEPOSIT IN THE FORM OF AN IRREVOCABLE STANDBY LETTER OF CREDIT.
The cash Security Deposit provided for in Paragraph 4G of the Lease
shall be deposited by Tenant with Landlord upon execution of this Lease;
however, Tenant shall have the right, at Tenant's sole election, to replace
one-half ($246,758.40) of the cash Security Deposit held by Landlord with an
irrevocable letter of credit, drawn upon an institutional lender reasonably
acceptable and accessible to Landlord in form and content reasonably
satisfactory to landlord and for a term equal to the Term of this Lease plus a
period of sixty (60) days, and said irrevocable letter of credit shall not be
subject to annual renewal. Said financial institution must agree that the
presentment for demand may be made in San Jose, Santa Clara or Palo alto,
California. One half of the cash Security Deposit ($246,758.40) held by Landlord
shall be refunded to Tenant upon Landlord's receipt of an acceptable irrevocable
letter of credit. If Tenant defaults with respect to any provisions of this
Lease, including but not limited to provisions relating to the payment of Rent,
landlord may (but shall not be required to) draw down on the irrevocable letter
of credit for payment of any sum which Landlord may spend or become obligated to
spend by reason of Tenant's default, or to compensate Landlord for any loss or
damage which Landlord may suffer by reason of Tenant's default. Landlord and
Tenant acknowledge that such irrevocable letter of credit will be treated as if
it were a cash Security Deposit, and such irrevocable letter of credit may be
drawn down upon by Landlord upon demand and presentation of evidence of the
identity of landlord to the issuing bank, in the event that Tenant defaults with
respect to any provision of this Lease and such default is not cured within any
applicable cure period. Landlord acknowledges that it is not entitled to draw
down such irrevocable letter of credit unless Landlord would have been entitled
to draw upon a cash Security Deposit pursuant to the terms of Paragraph 4G of
the Lease. Concurrently with the delivery of the required information to the
issuing bank, Landlord shall deliver to Tenant written evidence of the default
upon which the draw down was based, together with evidence that Landlord has
provided to Tenant the written notice of such default which was required under
the applicable provision of the Lease, and evidence of the failure of Tenant to
cure such default within the applicable grace period following receipt of such
notice of default. If any portion of the irrevocable letter of credit is used or
applied pursuant hereto, Tenant shall, within ten (10) days after receipt of a
written demand therefor from Landlord, restore and replace the value of such
security by either (i) depositing cash with Landlord in the amount equal to the
sum drawn down under the irrevocable letter of credit, or (ii) increasing the
irrevocable letter of credit to its value immediately prior to such application.
Tenant's failure to replace the value of the security as provided in the
preceding sentence shall be a material breach of its obligation under this
lease.
57. ASSIGNMENT OF WARRANTIES.
During the Term of the Lease, Landlord hereby assigns to Tenant all of
Landlord's Contractors' warranties and shall cooperate with Tenant in enforcing
any of such warranties
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except that Landlord shall not be required to pay any legal fees or incur any
expenses in this regard.
58. BROKERS.
Landlord and Tenant each represent to the other that they have dealt
with no real estate brokers, agents, or finders in connection with this
transaction, except as follows: Cornish & Carey Oncor International ("C&C"),
whose commission shall be paid by Landlord in accordance with landlord's
standard commission schedule which commission for this Lease is a total of
$100,000.00. Each party agrees to defend, protect, indemnify and hold the other
party harmless from and against all claims for brokerage commissions, finder's
fees, and other compensation made by any broker, agent, or finder as consequence
of the indemnifying party's actions or dealings with such broker, agent or
finder. The parties hereto acknowledge that landlord will not pay an additional
brokerage fee to C&C or any broker in the event the term of this Lease is
extended for any reason whatsoever.
37.
<PAGE> 1
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
EXHIBIT 10.10
BBN PLANET CORPORATION
DIAL UP NETWORK SERVICES AGREEMENT
THIS AGREEMENT (the "Agreement") is made as of October 15, 1996, by and
between BBN PLANET CORPORATION, with a principal business address at 150
CambridgePark Drive, Cambridge, MA 02140 ("BBN Planet") and I-PASS ALLIANCE
INC., 4 Avocet Drive #201, Redwood Shore, CA 94065 ("Customer").
RECITALS
BBN Planet operates and maintains a high-speed dial-up network which is
designed to provide End Users with local telephone connectivity to the Internet
across the continental United States.
Customer desires to offer nationwide dial-up Internet connectivity
services to its employees and to third parties (including both individuals and
corporations) as a part of other services offered to such third parties.
BBN Planet desires to provide to Customer and Customer desires to obtain
from BBN Planet, (1) local dial-up telephone access to BBN Planet's network for
itself and for certain third parties, and (2) a range of related services to
assist Customer in implementing Internet dial-up services, under the terms and
conditions of this Agreement.
NOW, THEREFORE. in consideration of the foregoing and the mutual
covenants set forth in this Agreement, the parties hereto agree as follows:
1. DEFINITIONS
1.1 "BBN BASIC SERVICES" shall mean the dial-up network services offered
by BBN Planet permitting Customer and third parties authorized by Customer to
access the Network (as defined below), all as more fully described in Exhibit A
hereto.
1.2 "COMMENCEMENT DATE" shall mean the earlier of the date upon which
Customer or a End User first connects to the Network via the BBN Basic Services.
1.3 "NETWORK" shall mean the high-speed dial-up network operated and
maintained by BBN Planet which is designed to provide access to the Internet.
1.4 "OPTIONAL SERVICES" shall mean those additional services provided by
BBN Planet and described in Exhibit A which are intended to assist Customer in
using and administering the BBN Basic Services.
1.5 "BBN SERVICES" shall mean BBN Basic Services, together with any
Optional Services selected by Customer.
1.
<PAGE> 2
1.6 "TERM" shall mean the period beginning on the Commencement Date and
extending for a one-year period thereafter.
1.7 "END USER" shall mean (a) any employee of Customer, and/or (b) any
third party which Customer permits to access the Network.
2. BBN PLANET RIGHTS AND RESPONSIBILITIES
2.1 PROVISION OF SERVICES. During the Term, BBN Planet will provide to
Customer the BBN Basic Services and Optional Services as described in EXHIBIT A,
BBN SERVICES attached hereto and incorporated herein by reference, all in
accordance with the terms and conditions set forth in this Agreement.
2.2 BILLING DATA. BBN Planet will transmit (via e-mail or otherwise) to
Customer, generally on a daily basis, the following data:
(a) End User ID;
(b) City the call came to;
(c) Time and date* of initial connect; and
(d) Start time and end time*
*All times in GMT
3. QUALITY COMMITMENT
If at any time Customer is dissatisfied with the quality of BBN
Services, Customer may notify BBN Planet in writing and describe the problem. If
the cause of service quality problem is within BBN Planet's control and service
has not improved to Customer's satisfaction within 30 days of such notice,
Customer may, as its sole and exclusive remedy, terminate this Agreement with no
cancellation penalty, and a pro-rata portion of any pre-paid Service fees
applicable to the terminated BSN Services will be refunded.
Termination under this Section 3 shall not be deemed a termination for
default and, therefore, shall not be subject to the terms of Section 8.4 or 8.6.
4. CUSTOMER RIGHTS AND RESPONSIBILITIES
4.1 THIRD PARTY ACCESS. Subject to the terms and conditions of this
Agreement, Customer shall have the non-exclusive right to provide access
(including the right to sell such access services) to the Network to End Users
in the continental United Stales.
4.2 END USER CONTACT AND BILLING. Customer shall be responsible for all
contacts with End Users, including but not limited to the following:
(a) CONTRACTING/RESULTED FLOWDOWN TERMS. Customer agrees that if
it permits End Users who are not bona fide employees of Customer to access the
Network, it shall
2.
<PAGE> 3
do so only pursuant to a written agreement incorporating terms and conditions
substantially similar to those set forth in EXHIBIT B, REQUIRED FLOWDOWN TERMS,
attached hereto and incorporated herein by reference.
(b) ACCOUNTING AND BILLING. Customer understands and agrees that
it is responsible for all billing and collection from the End Users, and that
Customer shall be responsible for paying BBN Planet on a timely basis as
provided in Section 5 below, regardless of whether Customer actually collects
payment from End Users.
(c) AUTHENTICATION AND AUTHORIZATION. Customer shall be
responsible for authenticating and authorizing Network access by End Users to
the Network. Customer agrees to install, operate, and maintain a dedicated
Radius server computer. BBN's Radius server will prompt each End User seeking
Network access for End User's identification and password information, and poll
customer Radius server for access authorization.
(d) COMMUNICATIONS. Customer shall be responsible for handling
all communication to and business relations with End Users related to access to
the Network
4.3 CUSTOMER BUSINESS AND TECHNICAL SUPPORT. Customer shall be
responsible for providing all technical and business support related to Network
access for End Users, including but not limited to responding to inquiries and
questions, hotline support, problem resolution, providing system configuration,
installation and support, as applicable and other such services and shall
maintain an organization which is highly trained and qualified to provide such
support.
4.4 CONTENT RESPONSIBILITY.
(a) BBN PLANET RESPONSIBILITY. Customer acknowledges and agrees
that BBN Planet has no responsibility for the content of transmissions by
Customer and End Users which may pass through the Network.
(b) CUSTOMER RESPONSIBILITY. Customer agrees that it will not
use Services for illegal purposes, to transmit threatening, obscene or harassing
materials, or to interfere or disrupt network End Users, services, or equipment.
Disruptions include, but are not limited to, distribution of chain letters,
propagation of computer worms and viruses, and using the Service to make
unauthorized entry to any other machine accessible via the Network.
4.5 END USERS/MANDATORY FLOWDOWN TERMS. Prior to providing access to the
Network to a End User, Customer shall enter into written agreements with End
Users in which each End User agrees to terms and conditions substantially
similar to those set forth in EXHIBIT B, REQUIRED FLOWDOWN TERMS, attached
hereto and incorporated herein by reference.
4.6 EQUIPMENT AND TELEPHONE SERVICE. Customer is responsible for
obtaining and providing the telephone services and modems necessary to access
the Network and Services. In no event shall BBN be responsible for End User
telephone charges.
4.7 INACTIVITY. Customer shall be responsible for notifying End Users in
writing that they will be automatically disconnected from the Network after five
minutes of inactivity.
3.
<PAGE> 4
5. PRICES AND PAYMENT.
5.1 PRICES. In connection with the provision of BBN Services hereunder,
Customer agrees to pay BBN Planet the prices set forth in EXHIBIT C, PRICES,
attached hereto and incorporated herein by reference.
5.2 CUSTOMER COMMITTED HOURS. Customer agrees to commit to the minimum
number of hours of Network Access Service as set forth in Exhibit C. ("Customer
Committed Hours"). Based on the Customer Committed Hours, BBN Planet will
invoice Customer for BBN Basic Services at the hourly rate set forth in Exhibit
C, Section A. 1.
5.3 INVOICES AND PAYMENT. BBN Planet will issue invoices to Customer on
a monthly basis. All payments are due net thirty (30) days from date of invoice.
Late payments will be subject to a late payment charge at a rate of one and
one-half percent (1.5%) per month plus any collection costs, including
reasonable attorneys' fees incurred by BBN Planet, or the maximum amount
permitted by law, whichever is less. In addition, BBN Planet reserves the right
to suspend Services to Customer in the event any invoice remain unpaid thirty
(30) days after the invoice due date.
5.4 TAXES. All prices are exclusive of any federal, state, municipal or
other governmental taxes, duties, sales or use taxes, excise taxes,
telecommunications taxes, or tariffs now or hereinafter imposed excluding any
taxes on BBN Planet's net income. All such charges shall be paid by Customer
unless Customer provides an exemption certificate acceptable to BBN Planet and
the applicable taxation authority
6. CONFIDENTIAL RELATIONSHIP.
6.1 CONFIDENTIAL BUSINESS INFORMATION. This Agreement creates a
relationship of confidence and trust between Customer and BBN Planet with
respect to certain business confidential information (`Information'). Each party
may disclose to the other party certain non-public marketing information,
customer Information, leads and other types of non-technical business
information in performance of this Agreement.
6.2 CONFIDENTIALITY REQUIREMENTS. Neither party shall disclose
information received from the other party to any third party and shall not use
that information except in performance of this Agreement. Upon the request of
the disclosing party, the other party shall return any materials received
containing information of disclosing party, and all copies thereof. Both parties
shall use the same care to prevent disclosure of information of the other party
which it uses to safeguard its own most valuable confidential information and/or
trade secrets, but in no event less than a reasonable degree of care for such
information.
6.3 EXCEPTIONS TO CONFIDENTIALITY REQUIREMENTS. The obligations of the
parties hereunder shall not apply to any information which:
(a) Was in the public domain at the time it was disclosed;
(b) Enters the public domain other than by breach of this
Agreement;
4.
<PAGE> 5
(c) Is independently developed by the receiving party without
access to the Information;
(d) Is known at the time of its disclosure to the other party;
or
(e) Is not identified as proprietary information at the time of
its disclosure.
7. WARRANTIES AND LIMITATION OF LIABILITY
7.1 WARRANTY. BBN Planet provides BBN Services hereunder strictly on an
"AS IS" and "AS AVAILABLE" basis without any express guarantee or assurance of
access, quality, reliability or functionality. BBN Planet warrants that it
possesses all necessary rights and corporate authority to provide the BBN
Services as specified in this Agreement and to execute its obligations hereunder
Except as expressly set forth herein, BBN PLANET DISCLAIMS ALL EXPRESS AND
IMPLIED WARRANTIES, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE. NEITHER BBN PLANET NOR ANY OF ITS SERVICE PROVIDERS,
LICENSORS, EMPLOYEES, OR AGENTS WARRANT THAT THE BBN SERVICES WILL BE
UNINTERRUPTED OR ERROR FREE.
7.2 WARRANTY EXCLUSIONS. BBN Planet does not warrant that the Network
will have the capacity to meet the demand of End Users during specific hours.
BBN Planet will not be liable for any damage that Customer or its End Users may
suffer arising out of use, or inability to use, the BBN Services provided
hereunder. Except for intentional acts by BBN Planet personnel, BBN Planet will
not be liable for unauthorized access to Customer's or End Users' transmission
facilities or premise equipment or for unauthorized access to or alteration,
theft, or destruction of Customer's or End Users' data files, programs,
procedures or information through accident, fraudulent means or devices, or any
other method, regardless of whether such damage occurs as a result of BBN
Planet's negligence.
7.3 LIMITATION OF LIABILITY. NEITHER PARTY SHALL BE LIABLE TO THE OTHER
FOR LOSS OF PROFIT, LOSS OF DATA, LOSS OF BUSINESS, LOSS OF REVENUE, OR FOR ANY
OTHER SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES. IN NO EVENT SHALL
BBN PLANET'S LIABILITY HEREUNDER EXCEED ONE HUNDRED THOUSAND DOLLARS ($100,000).
7.4 THIRD PARTY INDEMNIFICATION. Customer agrees that BBN Planet will
not be liable for any claim or demand against BBN Planet by any End Users.
Customer shall defend BBN Planet from any claims of third parties (including but
not limited to Customer's End Users) to the extent such claims arise out of the
provision of BBN Services under this Agreement, and Customer agrees to indemnify
and hold BBN Planet harmless from and against any and all resulting costs,
damages, and liabilities (including attorneys' fees) arising out of such claims;
provided, however, that (a) BBN Planet promptly notifies Customer in writing of
any such claim; (b) Customer has the opportunity to control the defense and all
related settlement negotiations; and (c) BBN Planet reasonably cooperates in the
defense and uses reasonable efforts to furnish all related evidence in its
control.
5.
<PAGE> 6
8. TERM AND TERMINATION.
8.1 TERM. The Term of this Agreement shall be one (1) year beginning on
the Commencement Data.
8.2 RENEWAL. This Agreement may be renewed for additional one (1) year
terms upon mutual written agreement of the parties
8.3 DEFAULT BY CUSTOMER. An event of default by Customer shall occur
hereunder if Customer:
(a) Fails to pay any Fees as set forth in this Agreement; and/or
(b) Fails to perform or observe any material covenant,
conditions or agreement to be performed or observed by Customer hereunder or
breaches any material representation or provision contained herein.
8.4 EVENT OF DEFAULT BY BBN PLANET. An event of default by BBN Planet
shall occur hereunder if BBN Planet fails to perform or observe any material
covenant, condition or agreement to be performed or observed by BBN Planet
hereunder or breaches any material representation or provision contained herein.
8.5 OTHER DEFAULTS. It shall be an event of default hereunder if a
judgment or decree is entered against either party approving a petition for
bankruptcy, liquidation, dissolution, composition or similar relief and such
Judgment or decree remains unvacated for sixty (60) days; or immediately if:
(a) either party shall file a voluntary petition in bankruptcy
or any petition or answer seeking and bankruptcy, liquidation, dissolution,
composition or similar relief;
(b) either party shall seek, consent, or acquiesce to the
appointment of a trustee or receiver, or the liquidation of such party's
property; or
(c) either party becomes insolvent or unable to pay its debts as
they become due during the ordinary course of business.
8.6 REMEDIES. Upon an event of default by a party, the other party shall
have the right to terminate this Agreement by giving the defaulting party
written notice of the event of default, specifying the nature of such default.
Terminations shall automatically occur thirty (30) days after the receipt of
such written notice if the event of default is not corrected. The rights and
remedies set forth in this Section 8 relating to termination for breach are in
addition to any other rights or remedies which otherwise might be available in
law or in equity.
8.7 EFFECTS OF TERMINATION.
(a) The provisions of Sections 6, 7 and 9 shall survive any
expiration or termination of this Agreement and shall bind the parties and their
legal representatives, successors, heirs and assigns.
6.
<PAGE> 7
(b) Upon any termination or non-renewal of this Agreement,
Customer shall pay BBN all Fees not yet paid but accrued prior to any such
termination or non-renewal.
9. GENERAL PROVISIONS.
9.1 PRESS RELEASES. BBN Planet and Customer agree to mutually review and
approve any press releases or announcements prior to their release with respect
to use of BBN Planet's name, trademarks, or Services being provided by BBN
Planet.
9.2 NO WAIVER. Either party's failure to exercise any right under this
Agreement shall not constitute a waiver of any other terms or conditions of this
Agreement with respect to any other or subsequent breach, nor a waiver by such
party of its right at any time thereafter to require exact and strict compliance
with terms of this Agreement.
9.3 GOVERNING LAW. This Agreement and all attachments, schedules and
exhibits shall be governed and construed in accordance with the laws, statues
and regulations of the Commonwealth of Massachusetts, excluding its choice of
law rules.
9.4 SEVERABILITY. If any provision of this Agreement is declared void,
illegal or unenforceable, the provision shall be deemed amended as necessary to
conform to applicable laws or regulations, or if it cannot be amended without
materially altering the intention of the parties, the remainder of the Agreement
shall continue in full force and effect as if the offending provision were not
contained herein.
9.5 FORCE MAJEURE. If the performance of any obligation is interfered
with by reason of any circumstances beyond the reasonable control of the party
affected, then the party affected shall be excused from such performance to the
extent necessary, provided that the party so affected shall use reasonable
diligent efforts to remove such causes of non-performance.
9.6 HIRING. Customer and BBN Planet agree that during the term of this
Agreement and for one (1) year thereafter they will not, without prior written
consent of the other, employ or offer employment to any employee of the other
who has knowledge or skills relating to the BBN Services provided by BBN Planet
hereunder.
9.7 ASSIGNMENT. Customer may not assign or otherwise transfer its rights
or obligations under this Agreement without BBN Planet's prior consent, which
consent will not be unreasonably denied.
9.8 INDEPENDENT THIRD PARTY. This Agreement creates no relationship of
joint venture, partnership or regency between the parties. Each party agrees and
acknowledges that it is not, and will not hold itself out as, the representative
or agent of the other party for any purpose.
9.9 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
and understanding between both parties and supersedes all previous proposal,
(both oral and written), negotiations, representations, writings and all other
communications between the parties. This Agreement may not be changed or
modified except by a written signed by the parties.
7.
<PAGE> 8
IN WITNESS WHEREOF, the parties hereto execute this Agreement as of the
day and year, first set forth above.
BBN PLANET CORPORATION [CUSTOMER]
By: /s/ M. BRODERICK By: /s/ CHRIS MOORE
--------------------------------- ---------------------------------
Name: Mary Broderick Name: Chris Moore
------------------------------- -------------------------------
Title: Sr. Contract Rep Title: President
------------------------------ ------------------------------
Date: 10/30/96 Date: 10/15/96
------------------------------- -------------------------------
8.
<PAGE> 9
EXHIBIT A
BBN PLANET
DIALINX SERVICES
(VERSION 1.0)
1. OVERVIEW
DiaLinx, a nationwide dial-up Internet access service, provides corporation and
organizations with a reliable means to connect branch offices, "telecommuters",
"roadwarriors" and customers to the Internet from any location in the
continental United States.
2. BBN PLANET BASIC SERVICES
2.1 NETWORK ACCESS. BBN Planet will provide Customer with nationwide
dial up access to the Internet through the BBN Planet DialLinx network. Access
is available through local access ports across the continental United States as
well as through 800 service in locations where local dial access is not
available.
2.2 NETWORK OPERATIONS. The BBN Planet Network Operations Center ("NOC")
monitors the DiaLinx network 24 hours per day, 365 days per year. The NOC
performs proactive operations support and troubleshooting of network and service
infrastructure components Including periodic testing of all DiaLinx access
ports.
2.3 SYSTEM SPECIFICATIONS
2.3.1 USER COMPONENT: To facilitate quality service, BBN Planet
has established the following as the minimum standards for desktop, portable, or
laptop computers used by Users when utilizing DiaLinx.
SUPPORTED PLATFORMS:
A. IBM compatible PC
1. Windows 3.1 and greater
2. Windows for Workgroups 3.11
3. Windows 95
B. Apple Macintosh
1. Macintosh System 7,1 or later
2. Mac OS
3. PowerPC
<TABLE>
<CAPTION>
Supported Processor Memory Memory Disk Space
Platforms (Minimum) (Minimum) (Recommended) (Minimum Install)
- --------- --------- --------- ------------- -----------------
<S> <C> <C> <C> <C>
Windows 3.1+ 486sx 4MB 10MB 12MB
Windows 95 486sx 6MB 10MB 12MB
Macintosh 68030 7MB 10MB 12MB
</TABLE>
9.
<PAGE> 10
2.3.2 CUSTOMER COMPONENT: BBN Planet requires Customers to manage their
user interface, including registration and termination, and to load valid End
Users on a Customer Radius server. Customer must utilize a RADIUS server
sufficient to communicate the anticipated usage volume to the RADIUS servers
deployed by BBN Planet to accomplish user access authentication. To support the
installation and operation of this servers, DiaLinx will provide one day
training of the customer technical staff at our Columbia, MD facility. Users
should be encouraged to use 14.4 Kbps or faster modems.
3. OPTIONAL SERVICES
Optional Services provided under this Agreement are as follows:
3.1 END USER HELP DESK SERVICES. BBN Planet will provide telephone Help
Desk support to Customer's End Users. This support will be answered in
Customer's name and provide assistance with installation and use of supported
desktop connectivity software, including browser and email. Trouble reporting
and escalation to Customer's support operation and/or BBN Planet network
operations is included.
3.2 CONNECTIVITY SUITE. BBN Planet provides software suites containing
the dial up communications package, TCP/IP stack, SLIP/PPP software, PAP,
Netscape(R) web browser, email and new clients. These suites will be private
labeled with Customer's logo, welcome screen, and other agreed to private
labeling features. BBN Planet can additionally provide services to incorporate
Customer unique software applications with connectivity suites, and to design,
reproduce, package and/or distribute software suites for Customer's end users.
3.3 USENET NEWS AND END USER EMAIL ACCOUNTS. BBN Planet will provide
Usenet News, and Individual email accounts hosted on a standard industry POP3
email server. End Users can store up to 5 Mbytes of mail storage.
3.4 BILLING SERVICES. BBN Planet offers two types of billing services.
BBN Planet will provide sorted and summarized user activity files. These records
will be electronically transferred to Customer on a monthly basis. Subject to
mutual agreement, BBN Planet will also provide direct billing to End User's
major credit card. The credit card is validated when BBN Planet receives
Customer's electronic transmission of a registered End User and his or her card
#/expiration date. Using Customer's pre-set rate structure, each End User's
credit card is "charged" Customer established rates, calculated by BBN Planet,
at the end of the billing cycle. All billings are credited to Customer's credit
card Merchant Account, and any End User credit card problems are reported to
Customer. Electronic files of all monthly billings will be forwarded to
Customer.
10.
<PAGE> 11
EXHIBIT B
MANDATORY FLOWDOWN TERMS
PREFACE
This Exhibit B summarizes essential terms to be incorporated into
agreements between Customer and its End Users in accordance with Sections 3.2(a)
and 3.5 of the Agreement. Customer may modify the wording of the essential terms
set forth below, provided, however, that the terms as modified are not
materially different in substance, enforceability, and effect from those terms
set forth below, For purposes of these Mandatory Flowdown Terms, "Network
Services Supplier" shall mean BBN Planet Corporation. Except as otherwise
defined herein, capitalized terms shall have the meeting ascribed in the
attached Agreement.
NO RIGHT OF RESALE
End Users may not resell or redistribute any BBN Services.
CONTENT RESPONSIBILITY
End User acknowledges and agrees that neither Customer nor its Network
Services Supplier is responsible for the content of the transmissions by End
User which may pass through the Network. End User agrees that it will take
reasonable steps to ensure that it will NOT use the BBN Planet Services for
illegal purposes, for transmission of threatening, obscene, or harassing
materials, or to interfere with or disrupt Network End Users, services or
equipment. Disruptions include, but are not limited to, distribution of chain
letters, propagation of computer worms and viruses, and using the Network to
make unauthorized entry to any other machine accessible via the Network.
Violation of the foregoing by Customer or its End Users may result in
termination of Network access rights to the offending party or parties.
WARRANTY AND LIABILITY LIMITATIONS.
Customer does not warrant that the BBN Planet Services will be available
on a specified date or time or that the Network will have the capacity to meet
the demand of End User or its End Users during specific hours. Neither Customer
nor its Network Services Supplier will be liable for any damage that End User or
its End Users may suffer arising out of use, or inability to use, the services
or products provided hereunder. Neither Customer nor its Network Services
Supplier will be liable for unauthorized access to Customer's transmission
facilities or premise equipment or for unauthorized access to or alteration,
theft or destruction of End User's data files, programs, procedures or
information through accident, fraudulent means or devices, or any other method,
regardless of whether such damage occurs as a result of Customer's or its
Network Service Supplier's negligence.
IN NO EVENT WILL CUSTOMER OR ITS NETWORK SERVICES SUPPLIERS BE LIABLE
FOR ANY OTHER DAMAGES, INCLUDING BUT NOT LIMITED TO LOSS OF DATA, LOSS OF
REVENUE OR PROFITS, OR FOR ANY OTHER SPECIAL, INCIDENTAL, INDIRECT OR
CONSEQUENTIAL DAMAGES, ARISING OUT OF OR IN CONNECTION WITH THE USE OF BBN
PLANET SERVICES TO ACCESS THE NETWORK.
11.
<PAGE> 12
NETWORK ACCESS AVAILABILITY
Access to the Network cannot be guaranteed to any Customer or End Users.
End Users may be unable to access the Network at any time, and disconnections
from the Network may occur from time to time.
12.
<PAGE> 13
EXHIBIT C
PRICES
A. BN Planet Basic Services
1. Network Access Service*
<TABLE>
<S> <C>
[*] Up to 10,000 hours from Contract Date to 12/31/96
[*]/hour From 1/1/97 - 3/31/97
[*]/hour 40,000 hrs/month 4/1/97 - 8/31/97
[*]/hour 60,000 hrs/month 9/1/97 - 12/1/97
[*]/hour 125,000 hrs/month 12/2/97 - 3/1/98
[*]/hr. 225,000 hrs./month after 3/1/98
800 Service [*]/hour
All End User Network Access Service Connect time is
rounded up to the next highest minute.
</TABLE>
B. Optional Services
<TABLE>
<S> <C>
1. Help Desk [*]/hour
2. Billing
Pre-billing [*]/subscriber/month
Credit Card [*] initial setup
[*] subscriber setup or change
[*] billed user/month
(all credit card company fees not included and are the
responsibility of Customer)
</TABLE>
3. Usenet News/End User Mail Accounts
<TABLE>
<S> <C>
1 - 4,999 accounts [*]/account/month
5,000 - 19,000 account [*]/account/month
20,000 + [*]/account/month
</TABLE>
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
13.
<PAGE> 14
4. Connectivity Suite (Note: connectivity suite = 3 diskettes)
<TABLE>
<S> <C>
One-time set up fee [*]
1-500 copies [*]
501-5000 copies [*]
5000+ copies [*]
</TABLE>
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
14.
<PAGE> 15
AMENDMENT NO. 1
DIAL UP NETWORK SERVICES AGREEMENT
This amendment (the "Amendment") to the Dial Up Network Services
Agreement between BBN Planet Corporation and i-Pass Alliance Inc. dated October
15, 1996 (the "Agreement") revises certain terms and conditions in the
Agreement.
The parties agree to amend the Agreement as follows:.
1. Delete Section 1.6 "Term" and substitute the following:
1.6 "Term" shall mean the period beginning on the Commencement Date and
extending until December 31, 1997.
2. Delete Section 5.2 Customer Committed Hours and replace with the following:
5.2 Customer Committed Hours. Customer understands and agrees that
it is obligated to pay for the minimum number of hours of
Network Access Service specified as Customer Committed Hours as
set forth in Exhibit C. Section A.2. Based on the Customer
Committed Hours amount, BBN Planet will invoice Customer for BBN
Basic Services at the hourly rate set forth in Exhibit C,
Section A.1. Customer acknowledges and understands that it is
obligated to pay the full amount due for the Customer Committed
Hours notwithstanding the fact that cumulative actual network
access service connect hours during the Term may be less than
the Customer Committed Hours amount. In such event, Customer
agrees to pay an amount which is the difference between (a) the
total amount due for the Customer Committed Hours at the Local
Access Service rate less (c) the amount due for actual network
Access Service connect hours at the Local Access Service rate.
Such amount is due and payable within thirty days of the last
day of the Term.
3. Delete Section 8.1 Term and replace with the following:
8.1 Term. The Term of this Agreement shall begin on the Commencement
Date and extend until December 31, 1997.
4. Delete Exhibit C. Prices and substitute the revised Exhibit C as set forth in
Attachment No. 1 to this Amendment.
5. Change all references to "BBN Planet Corporation" in the Agreement to "BBN
Planet, a division of BBN Corporation.
6. Other Matters
6.1 BBN Planet Engineering Activities. BBN Planet agrees to carry out
the following engineering activities for the benefit of Customer:
15.
<PAGE> 16
6.1.1 BBN Planet agrees to implement additional "redundancy" of
DiaLinx user authentication by adding to BBN Planet's RADIUS
authentication procedure the capability to utilize a second or
backup i-Pass RADIUS Server if Customer's primary RADIUS Server
is unavailable. This capability will be delivered to i-Pass by
4/15/97. Cost: [*]. Until BBN Planet delivers this
"redundancy" capability, BBN Planet and i-Pass will implement a
mutually agreeable interim, low cost solution by 1/31/97.
6.1.2 BBN Planet will identify at the time of user authorization
any user accessing the BBN Planet dial network via the 800
number. BBN Planet will provide a new attribute in the
authentication request packet that will flag the call as an
"800" access call. It will the responsibility of the i-Pass
end-user RADIUS server to use this information in conjunction
with the account name and password to authorize or deny access.
This capability will be delivered to i-Pass by 4/30/97. Cost:
[*]. Until BBN Planet delivers this "800 Identification"
capability, BBN Planet and i-Pass will implement a mutually
agreeable interim, low cost solution by 1/31/97.
6.1.3 i-Pass desires that BBN Planet provide "real-time"
disconnect data for each user. Ascend Communications has advised
BBN Planet that it plans to include an enhancement to track and
pass real-time disconnect data in the next version of the
Ascend software, Version 5.0. BBN Planet will provide the per
user session information in real-time via RADIUS accounting
packets to i-Pass, i-Pass is responsible to modify its RADIUS
servers to support a new accounting server attribute in each
user profile. Expected availability of Ascend software Version
5.0 on our network is April-May `97. BBN Planet will provide the
information on the specification to support this feature to
i-Pass by February 28, 1997. BBN Planet shall have no obligation
to provide "real time" disconnect data in the event that the
next version of Ascend does not include the capability to track
and pass real-time disconnect data as noted above.
6.1.4 BBN Planet and i-Pass agree to limit the number of realms
assigned to i-Pass and to establish a naming convention which
uniquely identifies BBN Planet's customers and i-Pass'
customers. On a reasonable efforts basis, BBN Planet and i- Pass
will implement a mutually agreeable approach for accomplishing
these objectives by 4/1/97. Until this approach is implemented,
BBN Planet will continue to support i-Pass' realm requirements
and its current naming convention.
6.1.5 Consideration. In consideration for BBN Planet's agreement
to undertake the engineering activities as described in
Paragraphs 6.1.1 and 6.1.2 above, Customer agrees to make a
nonrefundable prepayment of [*] (for 6000 hours of Local
Access Service) for the aforementioned engineering activities as
described above (i.e, a total of [*]) which amounts are
due and payable within fifteen days of the completion of each
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
16.
<PAGE> 17
activity. These amounts will be credited against amounts due and
payable under Section 5. for BBN Planet Basic Services.
6.2 Dialinx Pricing Assurance. If BBN Planet agrees to provide BBN
Planet Basic Services to one or more of the following competitors of
Customer ("Competitors") at prices (based on substantially similar
Customer Committed Hours, terms and conditions) which are less than
those granted to Customer under this Agreement, BBN Planet will so
advise Customer. BBN Planet may elect, but shall have no obligation, to
offer revised prices to Customer which are comparable to those offered
to a Competitor. In the event that BBN Planet elects not to offer
revised prices to Customer, Customer shall have the right to terminate
this Agreement at its convenience. If Customer elects to so terminate,
Customer's obligation under Section 5.2 Customer Committed Hours (as set
forth in the Agreement as amended) shall expire.
Competitors of Customer are as follows:
[List no more than two companies]: AimQuest, EUnet AimQuest, EUnet
During the Term Customer shall have the right to add up to four additional
companies to the above list upon delivery of written notice to BBN Planet.
6.3 BBN Planet Marketing Support
6.3.1 To facilitate Customer's sales efforts, BBN Planet will
carry out the marketing support activities as described in
Attachment No. 2.
6.3.2 In the event that BBN Planet fails to complete any of the
Marketing Support activities as described in Attachment No. 2,
BBN Planet will reduce the Customer Committed Hours amount as
set forth in Exhibit C (as revised) by the amount of hours set
listed in Attachment No. 2.
All other terms and conditions in the Agreement remain unchanged.
17.
<PAGE> 18
BBN PLANET I-PASS ALLIANCE INC.
A DIVISION OF BBN CORPORATION
By: /s/ WADE M. CARLL By: /s/ CHRIS MOORE
--------------------------------- ---------------------------------
Name: Wade M. Carll Name: Chris Moore
------------------------------- -------------------------------
Title: Regional Sales VP Title: President & CEO
------------------------------ ------------------------------
Date: 12/31/96 Date: 12/31/96
------------------------------- -------------------------------
18.
<PAGE> 19
ATTACHMENT NO. 1
EXHIBIT C
(REVISED DEC 26, 1996)
PRICES
A. BBN Planet Basic Services
1. Local Access Service
1.1 Up to 10,000 hours through 12./31/96 [ * ]
1.2 January l, 1997 through December 31, 1997. The price for all
Local Access Service is [ * ]/hour except for individual calendar months
in which the actual hours of Local Access Service exceeds the following
amounts in which case the price for all Local Access Service hours
during the month will be as listed.
<TABLE>
<S> <C>
40,000 to 124,999 hours per month [*]/hour
125,000 to 224,999 hours/month [*]/hour
225,000+ hours/month [*]/hour
</TABLE>
1.3 800 Service [*]/hour
All End User Network Access Service Connect time is
rounded up to the next highest minute.
2. Customer Committed Hours 100,000 hours*
*Customer Committed Hours includes End User Access Service Connect time
between January 1, 1997 and December 31, 1997 but excludes all End User
Access Service Connect time before January 1, 1997.
B. Optional Services
In the event that Customer wishes to purchase any Optional Services
during the Term, Customer shall issue a Purchase Order which references
this Agreement, the Optional Services ordered and price.
1. End User Help Desk Service
<TABLE>
<S> <C>
Basic Service Set Up Fee (One Time) [*]
Help Desk Service [*]/hour
</TABLE>
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
19.
<PAGE> 20
2. Billing
<TABLE>
<S> <C>
Pre-sorted call records [*]/subscriber/month
Credit Card [*] initial setup
[*] subscriber setup or change
[*] billed subscriber/month
</TABLE>
(all credit card company fees not included and are the
responsibility of Customer)
3. Usenet News/End User Mail Accounts
<TABLE>
<S> <C>
1 - 4,999 accounts [*]/account/month
5,000 - 19,000 account [*]/account/month
20,000 + [*]/account/month
</TABLE>
4. Connectivity Suite (Note: connectivity suite = 3 diskettes)
<TABLE>
<S> <C>
One-time set up fee [*]
1-500 copies [*]/ copy
501-5000 copies [*]/ copy
5000+ copies [*]/copy
</TABLE>
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
20.
<PAGE> 21
ATTACHMENT NO. 2
BBN PLANET MARKETING SUPPORT
A. BBN Planet agrees to provide the following marketing support for the benefit
of Customer:
1. BBN Planet will brief its Regional Sales Directors on the i-Pass
offering within thirty (30) days of the execution of Amendment No. 1. i-Pass
must provide all necessary and appropriate information (subject to BBN Planet
approval) within ten (10) days of execution of Amendment No. 1.
2. BBN Planet will include a description of the i-Pass offering and a
link to the i-Pass World Wide Web site on the BBN Planet iweb site within
forty-five (45) days of receipt by BBN Planet of i-Pass materials which
materials are acceptable to BBN Planet.
3. BBN Planet will permit i-Pass to send one direct mailing to BBN
Planet's ISP customers. This mailing is at i-Pass expense and will be carried
out by a mutually acceptable third party.
4. BBN Planet will provide i-Pass the opportunity to speak at the BBN
Planet national sales meeting in July 1997.
5. BBN Planet will provide the opportunity for i-Pass to distribute
i-Pass literature from BBN Planet's booth at two trade show at which BBN Planet
will feature its Dial Up Network Service prior to June 30, 1997.
B. In the event that BBN Planet fails to perform one or more of the above
mentioned marketing support activities, The Customer Committed Hours amount as
set forth in Exhibit C (as revised) shall be reduced by 2000 hours for each
marketing support activity not performed.
21.
<PAGE> 22
ATTACHMENT A
TO THE SETTLEMENT AND RELEASE AGREEMENT
AMENDMENT NO. 2
TO THE
DIAL-UP NETWORK SERVICES AGREEMENT
("DIAL-UP AGREEMENT")
BETWEEN
GTE INTERNETWORKING INCORPORATED (FORMERLY BBN PLANET) ("GTE")
AND
i-PASS ALLIANCE, INC., ("i-PASS")
THIS AMENDMENT #2 to the Dial-Up Network Services Agreement dated October 15th
1996 (referred to as "Dial-Up Agreement"), between GTE INTERNETWORKING
INCORPORATED (formerly BBN Planet) a corporation with principal offices at 150
CambridgePark Drive, Cambridge, Massachusetts 02140 ("GTE") and I-PASS ALLIANCE,
INC., a corporation with principal offices 650 Castro Street, Suite 280 Mountain
View, CA 94041, USA ("i-Pass"), ("Customer")
RECITALS
A. The parties agree to incorporate the following provision into the Dial-Up
Agreement as set forth below:
3.1 Service Level Guarantee. GTE shall provide to i-Pass an overall
dial-up network availability of ninety-eight (98%) percent. Should GTE provide
less than ninety-eight (98%) percent availability, then the percentage
difference between ninety-eight (98%) percent commitment and the actual
availability shall be credited to i-Pass' monthly bill provided that i-Pass
exceed a minimum total usage equal to one twelfth (1/12th) of the Yearly
Commitment.
B. The parties agree to modify the following provision of the Dial-Up Agreement
as set forth below.
1.6 Term. Shall mean the period of two (2) years from the effective date
of this agreement.
Exhibit C - "Price". A.1. "Network Access Services"
<TABLE>
<S> <C> <C>
Yearly Commitment 100,000 hours @ [*] per hour
800/888 Service @ [*] per hour
</TABLE>
All End User Network Access Connect time is rounded up to the next
higher minute.
C. The parties agree to change all references to "BBN Planet" in the Dial-Up
Agreement to "GTE Internetworking Incorporated."
D. Except as amended hereby (and by any other Amendments, if applicable), all
other terms and conditions of the Dial-Up Agreement shall remain in full force
and effect.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
25.
<PAGE> 23
These terms and conditions have been read, are understood, and are hereby
accepted.
GTE Internetworking Incorporated i-PASS ALLIANCE INC.
By: /s/ FRANK MANISCALCO By: /s/ G. BRADFORD SOLO
--------------------------------- ---------------------------------
Name: Frank Maniscalco Name: G. Bradford Solo
------------------------------- -------------------------------
Title: Contracts Representive Title: Vice President & CFO
------------------------------ ------------------------------
Date: 3/31/98 Date: 3/31/98
------------------------------- -------------------------------
26.
<PAGE> 24
Amendment for
DiaLinx International Services
(rev. June 1999)
This Amendment for DiaLinx International Services ("DLI Amendment")
together with, either: (i) the Service Schedule - DiaLinx Services and Master
Agreement for Internetworking Services, or (ii) the Dial-up Network Services
Agreement, between the parties (the "Agreement") define the terms and conditions
by which GTE Internetworking Incorporated ("we") will provide the customer
listed below ("you") with the services described herein.
(a) Covered Services. We will provide you with the DiaLinx International
Services ("DLI Services") in accordance with the terms of the Agreement as
amended by this DLI Amendment. These DLI Services are designed to allow you to
access the DiaLinx Network via our international points of presence.
(b) Term. The DLI Services represent an enhanced, optional DiaLinx service. The
DLI Services will be offered concurrently with the Basic Services, unless
earlier cancelled by a party.
(c) DLI Pricing - Rate Schedule. The following prices and terms will apply to
access to the DiaLinx and DLI Services:
DiaLinx International: Access to the Network via any DiaLinx
International access number will be charged as follows.
<TABLE>
<CAPTION>
DiaLinx Zone Code Hourly Rate
----------------- -----------
<S> <C>
Zone 1 ("UK") [*]
Zone 2 ("Europe") [*]
Zone 3 ("Aus./N.Z.") [*]
Zone 4 ("Mexico") [*]
Zone 5 ("Asia") [*]
</TABLE>
A list of dial-in access numbers associated with each DiaLinx
International zone can be found at
http://www.bbn.com/support/docs/intpops.xls. GTE Internetworking expects
the DiaLinx Network to change over time in order to meet the changing
needs of our customers. We reserve the right to add to, delete or change
the dial-in access number associated with a specified zone from time to
time. Geographic references are for convenience only; actual access
numbers may vary from geographic boundaries.
We also reserve the right to add additional services and zones to the
foregoing rate schedule as the DiaLinx network develops (e.g. Canadian
800 Service). These additional services and respective prices will be
made available to you on an on-going basis, and will be deemed added to
the foregoing rate schedule upon notice by us to you that they are
available. For an updated list of services, prices, and dial-up access
number associated with each zone, please consult our Web page or contact
your GTE Internetworking representative.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
29.
<PAGE> 25
All Network connect time is rounded up the next highest minute and
billed in one minute increments. Invoices are issued monthly and due net
thirty days. All pricing is listed as U.S. dollars.
(d) CURRENCY AND TAXES. All payments shall be in U.S. Dollars. You are
responsible for the payment of all taxes (including without limitation
applicable VAT or withholding taxes but excluding taxes based solely on our net
income), import duties, or other applicable telecommunications or regulatory
fees (collectively, "Taxes"). You shall not deduct any such Taxes from the
amounts owed to us. In the event you are required to withhold Taxes from any
payment due to us, then the amount of such payment shall be automatically
increased to totally offset such Taxes, so that the amount actually remitted to
us, net of all Taxes, equals the amount invoiced or otherwise due.
(e) COMPLIANCE WITH APPLICABLE EXPORT AND LOCAL LAWS. You agree that you shall
use the DLI Service in full compliance with (i) all applicable export laws
(including without limitation any U.S. export laws) and (ii) local laws and
regulations of the jurisdiction in which the DLI Service is provided, including
without limitation any laws governing the import of the DLI Service, or
governing the access of content which may be available via the DLI Service. We
reserve the right to suspend or terminated the DLI Service (or any portion
thereof) without notice in the event that we believe that your use (or any of
your user's use) of the DLI Service may be in violation of any applicable export
law, local law, regulation, or ordinance. You acknowledge that we have no
control over or liability for the actions of local jurisdictions which may
restrict or block DLI Services.
(f) DISPUTES. Any dispute arising out of or in connection with the DLI Services
in a country other than the United States, shall be referred to and finally
resolved by arbitration in accordance with the Rules of the International
Chamber of Commerce then in force; provided, however, that either party may, at
its sole discretion, seek injunctive relief in the courts of any jurisdiction as
may be necessary and appropriate to protect its proprietary or confidential
information. The language used in the arbitral proceedings, and the governing
language of the Agreement, shall be English. Unless otherwise mutually agreed
upon in writing by the parties, the site of the arbitration shall be Boston,
Massachusetts, U.S.A. Judgment upon the award of the arbitration may be entered
in any court having jurisdiction thereof.
(g) GOVERNING LAW. The governing law in any dispute shall be the substantive law
of the Commonwealth of Massachusetts, U.S.A. without regard to conflicts of law.
The parties expressly agree that the U.N. Convention no Contracts for the
International Sale of Goods shall not apply to the Agreement.
(h) AMENDMENTS; SEVERABILITY. This DLI Amendment may only be modified by a
written amendment duly executed by other parties. If any provision of this DLI
Amendment shall be invalid or enforceable, the remainder of this DLI Amendment
shall not be affected.
Except as expressly modified by this DLI Amendment, all terms and conditions of
the Agreement shall remain in full force and effect. The terms and conditions of
the Agreement (including, but not limited to, any disclaimers and limitations on
liability) will continue to apply to the services described herein. Any terms
defined in the Agreement and not defined in the DLI
30.
<PAGE> 26
Amendment shall have the meaning given in the Agreement. In the event of any
conflict between the terms of the Agreement and the terms of this DLI Amendment,
the terms of this DLI Amendment shall control.
Accepted and Agreed to:
- --------------------------------------------------------------------------------
Company (Type or Print Full Customer Name): iPass
-------------------------------------
Signature: /s/ Michael Mansouri Date: July 2, '99
---------------------------------- ------------------------
Print Name: Michael Mansouri Title: CEO
--------------------------------- ------------------------
GTE Internetworking Incorporated
Signature: Date:
---------------------------------- ------------------------
Print Name: Title:
--------------------------------- -----------------------
- --------------------------------------------------------------------------------
(1) Any payments under this Amendment will be credited under the Master
Agreement.
31.
<PAGE> 27
Quotation
DiaLinx Services (Version 2.3)
EXHIBIT C FOR DIALINX SERVICE FOR IPASS
- --------------------------------------------------------------------------------
This Exhibit C shall supercede the Exhibit C in the Dial-Up Network Services
Agreement dated December 21, 1998 ("Agreement") and any amendment thereto,
provided, however, that all fees for services delivered prior to the execution
of this revised Exhibit C are still due.
1. Pricing Summary: This section highlights the general elements of pricing
and commitments:
1.1 Network Access. You will be billed for each end user that may access the
GTE Internetworking DiaLinx network ("North American Network") in
accordance with the pricing options set forth herein. You will be
charged for Network Access, which, for each calendar month, shall be the
greater of either (a) Access charges due in accordance with Section 5
"Rates and Charges" or (b) Monthly Customer Commitment as set forth in
Section 2 "Minimum Monthly Commitment".
1.2 Monthly Customer Commitment: In return for volume discounts
(inherent in the prices stated below) you have agreed to use a
minimum dollar volume of network access in each month of the
agreement ("Monthly Customer Commitment"). In the event that
your actual network access charges do not meet the Monthly
Customer Commitment, you will be billed for the applicable
Monthly Customer Commitment (the difference between you actual
network access usage and the Monthly Customer Commitment is the
"Commitment Payment")
1.3 Term Commitment: The aggregate of the Monthly Customer
Commitment is [*] ("Term Commitment"). In the event your
actual network access charges exceeds the Term Commitment all
subsequent Monthly Customer Commitment obligations shall be
suspended.
1.4 If, at the end of each twelve (12) month period, your actual
network access charges exceeds [*] ("Annual Commitment") and you
have paid a Commitment Payment, you will be credited either (a)
the amount Customer has exceeded the Annual Commitment or (b)
the applicable Commitment Payment, whichever is less.
For example:
If Customer's actual network access charges reached [*] in month
12 and during that same period Customer made one Commitment
Payment of [*], then Customer shall be issued a credit equal
to [*]. (Example One)
If Customer's actual network access charges reached [*] in month
12 and Customer had never made a Commitment Payment, then
Customer shall not be issued a credit in this example. (Example
Two)
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
32.
<PAGE> 28
2. Minimum Customer Commitment. During the Service Period, in return for
discounts inherent in the pricing outlined therein, you have agreed to
use a minimum dollar volume of network access in the amount of
two-hundred-thousand-dollars ([*] per month, after discounts, of
the agreement ("Minimum Customer Commitment"). In the event that Network
access charges do not meet the Minimum Customer Commitment you will be
billed for the difference between the amount actually charged within the
given month and the Minimum Customer Commitment.
3. Commencement Date: The terms and conditions of this Exhibit C shall be
applied to charges assessed in the month of December (1999) if the
Agreement is executed on or before December 17, 1999. In the event this
Agreement is executed after December 15, 1999, the terms and conditions
of this Exhibit C shall be applied to charges assessed in the month of
January (2000).
4. Service Period. The Service Period shall be thirty-six (36) full
calendar months.
5. Rates and Charges: All rates and charges for the services defined in
this Section 5. All network connect time is rounded up to the next
highest minute and billed in one minute increments. Invoices are issued
monthly, and are due net 30 days. All pricing is listed as U.S. dollars.
For a complete listing of the all DiaLinx Access Numbers are associated
rates, a list of all access numbers can be obtained from your local
account representative, or downloaded from the following URL:
http://www.bbn.com/support/DiaLinx.htm.
5.1 North American Per-User Rates: In any month where the number of
Users accessing the DiaLinx Network exceeds the thresholds in
the table below, the applicable Rates for that month will be
reduced to the corresponding Rates.
Per-User Rates are available on a thirty (30) hour plan, based
on the average use of all active users in any given month. For
example: If Customer has 200 users access the DiaLinx Network
the total allowable hours is [*] (or 200 Users x 30 Hour Plan).
<TABLE>
<CAPTION>
UNITED STATES RATE CANADIAN RATE
------------------ -------------
PER PER
PER OVERAGE PER USER OVERAGE USER OVERAGE USER OVERAGE
USER US US US US CANADA CANADA CANADA CANADA ______
ANALOG ANALOG USDN ISDN ____ ANALOG ANALOG ISDN USDN CANADIAN
30 HOUR (PER 30 HOUR (PER US (PER 30 HOUR (PER 30 HOUR 30 HOUR (PER
PLAN HOUR) PLAN HOUR) HOUR) PLAN HOUR) PLAN PLAN HOUR)
# USERS (___) (___) (___) (___) (___) (___) (___) (___) (___) (___)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
0-25,000 [*] [*] [*] [*]
25,000+ [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
50,000+ [*] [*] [*] [*]
100,000+ [*] [*] [*] [*]
</TABLE>
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
33.
<PAGE> 29
5.1.1 Overage Rates: If the average total hours of access by
Users exceed thirty (30) hours/user, then the Rates will
be adjusted upwards by the corresponding rate listed
above for each hour, or partial hour, that the user
exceeds 30 hours/user. (e.g. If the total number of
hours of network access by U.S. Flat Rate Analog Users
divided by the number of such users equals 31.5 hours,
the Base Rate will be adjusted upwards by [*] per Flat
Rate Analog User.)
5.1.2 800/888Charge: In addition to any other applicable
charges under Section 5, you will be charged the 800/888
charge for each hour that an End User accesses the
Network via the 800/888 access number.
5.1.3 ISDN Charge: In addition to any other applicable charges
under Section 5, you will be charged twenty-five percent
(25%) over the published analog prices in Section 5.
Please note that ISDN access will not be consistently
available on an International basis.
5.2 North American Hourly Rates: In any month where the number of
hours accessing the DiaLinx Network exceeds the thresholds in
the table below, the applicable Hourly Rate for that month will
be reduced to the corresponding Hourly Rate.
<TABLE>
<CAPTION>
UNITED STATES RATES CANADIAN RATES
---------------------------------------- -----------------------------
HOURLY 800/888 HOURLY HOURLY 800/888
US HOURLY US CANADIAN CANADIAN CANADA
MONTHLY ANALOG US ISDN (PER HR) ANALOG ISDN (PR. HR)
HOURS (_____) (_____) (_____) (______) (______) (______)
<S> <C> <C> <C> <C> <C> <C>
0-300,000 [*] [*] [*] [*] [*] [*]
300,000+ [*] [*] [*] [*]
500,000+ [*] [*] [*] [*]
1,000,000+ [*] [*] [*] [*]
3,000,000+ [*] [*] [*] [*]
5,000,000+ [*] [*] [*] [*]
</TABLE>
5.2.1 ISDN: We will provide you with ISDN / PRI (single
channel) service in cities where such service is
available. The cost of this service per hour, according
to the table above, is for a single "B" channel.
Currently, ISDN is not offered on the 800/888 line.
5.2.2 800/888 Charge: In addition to any other applicable
charges under Section 5, you will be charged the 800/888
charge for each hour that an End User accesses the
Network via the 800/888 access number.
5. Spamming: GTE Internetworking reserves the right, at our discretion, to
prohibit incidences of unacceptable use of electronic mail (as defined
in our Acceptable Use
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
34.
<PAGE> 30
Policy which is available http://www.bbn.com/aup/) by restricting all
outbound IP data packets using port 25 to single IP address. This IP
address would be an SMTP mail relay-post office controlled by the
customer.
6. Credit Policy: Our acceptance of the pricing and commitments set forth
in this Quotation is subject to GTE Internetworking's current credit
approval policy. We reserve the right to modify the terms of this
Quotation, require additional assurances, or reject the Quotation
following credit review if terms satisfactory to both parties cannot be
agreed upon.
7. Additional Realms: GTE Internetworking will support five (5) RADIUS
Authentication realms to you. Customers who require additional realms
will be charged a monthly fee of [*] for a block of five (5) additional
realms.
8. Help Desk Support
8.1 Level 1 (End-User) Help Desk Support: Customer shall be
responsible for providing Level 1 Help Desk Services.
8.2 Level II and III (Network) Support. Every GTE Internetworking
customer is provided with second-level help desk support
designed to work with either your own or out-sourced help desk,
you project administrator or you IS Department. This help desk
is integrate with our Networking Operations center and is the
first point of contract for opening new trouble tickets, getting
updates on existing ones, or simply asking information
questions.
9. Right of First Refusal: Customer will grant GTE a right of first refusal
to match or beat any offer for nationwide flat rate access service in
the United States from another Qualified Vendor before entering into a
contract with the Vendor. A Qualified Vendor shall mean a facilities
based nationwide dial-up Internet Service Provider with at least 300
local dial access number and the services must be substantially similar
in (i) quality and scope, (ii) availability on a geographic basis; and
(iii) commitment levels and remaining term of the Service Period.
Customer may not terminate this Agreement in the event that GTE fails to
meet such offer.
10. The terms and conditions of the attached Service Level Agreement ("SLA")
are made part of and incorporated into this Agreement (Attachment No.
3).
- --------------------------------------------------------------------------------
PLEASE SIGN BELOW TO INDICATED YOUR UNDERSTANDING AND ACCEPTANCE OF THE TERMS OF
THIS QUOTATION:
COMPANY (TYPE OR PRINT FULL CUSTOMER NAME):
-------------------------------------
SIGNATURE: /s/ MICHAEL MANSOURI DATE: Dec. 17 1999
------------------------------- -------------------------------
PRINT NAME: Michael Mansouri TITLE: Chairman & CEO
------------------------------- -------------------------------
- --------------------------------------------------------------------------------
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
35.
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AMENDMENT NUMBER TWO (2)
TO THE
DIAL UP NETWORK SERVICES AGREEMENT
BETWEEN
GTE INTERNETWORKING INCORPORATED AND I-PASS ALLIANCE, INC.
THIS AMENDMENT NUMBER TWO (2) to the executed Dial Up Network Service Agreement
("Dial Up Agreement") is entered into this 17th day of December, 1999, between
GTE Internetworking, Incorporated ("GTE," "us" "we" or "ours") and i-Pass
Alliance, Inc. ("i-Pass," "customer," "you" or "your").
1) The parties desire to amend the Dial Up Agreement such the following
paragraphs shall read as set forth:
Delete Section
a) Delete Section 1.6 "Term" and substitute the following:
1.6 "TERM" shall mean the period beginning on Commencement Date
and extending until December 31, 2002.
b) Delete Section 1.7 "End User" and substitute the following:
1.7 "END USER" shall mean (a any employee of Customer, and/or (b)
any third party which Customer permits (either directly or
indirectly through subdistributors) to access the Network.
c) Delete Section 4.1 Third Party Access and replace with the
following:
4.1 THIRD PARTY ACCESS. Subject to the terms and conditions of
this Agreement, Customer shall have the non-exclusive right to
provide access (including the right to sell such access
services) to the Network to End Users through one or more
tiers of subdistributors, and to grant the right to its
customers to do the same under circumstances whereby a
contractual obligation exists.
d) Delete Section 4.5 End Users/Mandatory Flowdown Terms and replace
with the following:
4.5 END USERS/MANDATORY FLOWDOWN TERMS. Prior to allowing access
to the Network to an End User, Customer shall enter into
written agreements with End Users or its subdistributors, as
applicable, the terms of such agreements shall require that
each End User agree to terms and conditions substantially
similar to those set forth in Exhibit B, Mandatory Flow Down
Terms, attached hereto and incorporated herein by reference.
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e) Delete Section 8.1 Term and replace with the following:
8.1 TERM. The Term of this Agreement shall begin on the
Commencement Date and extend until December 31, 2002 unless
and until terminated earlier in accordance with this
Agreement.
f) Delete Section 8.6 Remedies and replace with the following:
8.6 REMEDIES. The following remedies shall be incorporated as set
forth below:
8.6.1 This Agreement may not be terminated by either party
prior to the end of the Term except that either party
may terminate this Agreement in the event of default by
the other party by giving the defaulting party written
notice of the event of default, specifying the nature of
such default. Termination shall automatically occur
ninety (90) days after the receipt of such written
notice if the event of default is not corrected. Upon
termination or expiration for any reason, both parties
shall continue to perform all of their obligations under
this Agreement for a phase-out period of ninety (90)
days, and GTE shall cooperate and assist Customer in
phasing out the Service and reasonably assist Customer
in transferring to a new service provider.
8.6.2 We reserve the right, but assume no obligation, to
terminate performance immediately if you are more than
30 days overdue in payments. Additionally, we reserve
the right to terminate performance if you have violated
(a) any laws concerning the transmission of technical
data and/or other regulated material or 9b) our
acceptable use of policy which is attached hereto as
Exhibit D ("Acceptable Use Policy"). Prior to
termination of the Service (or any portion thereof) for
said violation, we shall provide you with written
notification and a ten (10) day cure period from your
receipt of such notification. If the violation has not
been rectified by the end of the third day of the ten
(10) day cure period, we reserve the right to suspend
service for the remainder of the ten (10) day cure
period. If, the violation has not been rectified after
the ten (10) day cure period, we reserve the right to
terminate performance. Notwithstanding the foregoing, if
the violation is of a nature that disrupts the network
in a technical and/or operational manner ("Operational
Violation"), we reserve the right to immediately suspend
or terminate performance; provided however that
performance due to an Operational Violation will be
suspended for no more than 10 days in any three (3)
month period. GTE may modify the Acceptable-Use Policy
only to accommodate (i) the standard business practices
and social policies of the internet community; (ii)
compliance with administrative directives, legal
precedent and/or applicable legislation; or (iii) the
reasonable business and economic concerns of GTE
Internetworking. If, at any time, we change the
Acceptable Use Policy in a material manner which we
attempt to
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<PAGE> 33
enforce against you pursuant to this Agreement, you may
terminate the Service by us with thirty (30) day written
notice of your intent to cancel. Should you terminate Service
under the conditions described herein this Provision 8.6.2,
you will be responsible for fees accrued through the date of
cancellation and will not be subject to an early cancellation
fee.
2) Exhibit B "MANDATORY FLOW DOWN TERMS" shall be replace with the revised
Exhibit B, dated December, 1999.
3) Capitalized terms used and not defined herein shall have the meanings
ascribed thereto in applicable Agreement.
4) Except as amended hereby (and by any other Addendum, if applicable), all
other terms and conditions of the Agreement shall remain in full force and
effect.
These terms and conditions have been read, are understood, and are hereby
accepted.
GTE INTERNETWORKING INCORPORATED i-PASS ALLIANCE INC.
By: /s/ CHRISTI KNOCH By: /s/ RONALD CALANDRA
-------------------------------- ------------------------------------
Name: Christi Knoch Name: Ronald Calandra
------------------------------ ----------------------------------
Title: Contract Representative Title: Vice President
----------------------------- ---------------------------------
Date: 12-17-99 Date: 12/17/99
------------------------------ ---------------------------------
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY BLANK]
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<PAGE> 34
EXHIBIT B
MANDATORY FLOW DOWN TERMS
DECEMBER 1999
PREFACE
This Exhibit B summarizes essential terms to be incorporated into agreements
between Customer and its End Users or its subdistributors, as applicable, in
accordance with Sections 4.2(a) and 4.5 of the Agreement. Customer may modify
the wording of the essential terms set forth below, provided, however, that the
terms as modified are not materially different in substance, enforceability, and
effect from those terms set forth below. For purposes of the Mandatory Flow Down
Terms. "Network Services Supplier" shall mean GTE Internetworking, Incorporated,
successor to the business interest of BBN Planet Corporation.
1) Neither iPass nor its suppliers of network services ("Network Services
Suppliers") exercise and control whatsoever over the content of the information
passing through their systems, and access to the Internet is provided solely on
an "as is" basis. Neither iPass nor its Network Services Suppliers shall be
liable for any consequences suffered by any person as a result of Internet
access including, without limitation, the possibility of contracting computer
viruses and accessing information with offensive, inaccurate, or inappropriate
content. Neither iPass nor its Network Services Suppliers shall be liable for
any damages suffered by any person as a result of obtaining Internet access. You
acknowledge and agree that all End Users must exercise their own due diligence
before relying on any information available on the Internet, and must determine
that they have all necessary rights to copy, publish, or otherwise distribute
any such information available on the Internet under copyright and other
applicable laws.
2) End User agrees that it will take reasonable steps to ensure that it will
NOT use the service for illegal purposes, for transmission of threatening,
obscene, or harassing material, or to interfere with or disrupt Network End
Users, services or equipment. Disruptions include, but are not limited to,
distribution of unsolicited chain letters, propagation of computer worms and
viruses, and using the Network to make unauthorized entry to any other machine
accessible via the Network. Violation of the foregoing may result in termination
or suspension of Network access rights to the offending party or parties.
3) Neither iPass nor its Network Services Suppliers warrant that the Services
will be available on a specified date or time or that the network will have the
capacity to meet your demand during specific hours. You may be unable to access
the network at any time, and disconnection from the network may occur from time
to time. Neither iPass nor its Network Services Suppliers will be liable for
unauthorized access to or alteration, theft or destruction of any data files,
programs, procedures, or information through accident, fraudulent means or
devices, or any other method, regardless of whether such damage occurs as a
result of iPass's or its Network Service Suppliers' negligence.
4) IPASS AND ITS NETWORK SERVICES SUPPLIERS DISCLAIM ALL WARRANTIES AND
CONDITIONS OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING WITHOUT
LIMITATION THE IMPLIED WARRANTIES OF
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TITLE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT.
NEITHER IPASS NOR ITS NETWORK SERVICES SUPPLIERS SHALL BE LIABLE FOR ANY
THIRD-PARTY NETWORK FAILURE.
5) IN NO EVENT SHALL IPASS OR ITS NETWORK SERVICES SUPPLIERS BE LIABLE FOR
ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, OR FOR INTERRUPTED
COMMUNICATIONS, LOST DATA OR LOST PROFITS, ARISING OUT OF OR IN CONNECTION WITH
THE SERVICE.
6) iPass and its Network Services Suppliers shall be deemed to be third-party
beneficiaries of this agreement, with the right to enforce the terms of this
agreement.
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EXHIBIT D
GTE INTERNETWORKING INCORPORATED
ACCEPTABLE USE POLICY
Version 1.1
Release Date: February 11, 1998
http://www.bbn.com/aup/
I. Introduction and Coverage
II. Compliance
III. Consequences of Non-Compliance
IV. Prohibited Use
V. Legal
VI. Complaints and Contact Information For GTEI (bbnplanet)
VII. Complaints and Contact Information For GTE.NET
I. INTRODUCTION AND COVERAGE
GENERAL
This Acceptable Use Policy sets forth guidelines for acceptable use of the GTE
Internetworking Network. All users of the GTE Internetworking Network are
required to comply with this policy. Users must also comply with all terms and
conditions of applicable agreements, and with any additional policies that may
be applicable to a specific service offered by GTE Internetworking.
DEFINITIONS
As used in this Acceptable Use Policy, the terms shall have the respective
meanings set forth below:
"GTE" Internetworking" includes, without limitation, GTE Internetworking
Incorporated, GTE Intelligent Network Services Incorporated, BBN Corporation
(successor-in-interest to BBN Planet Corporation and Genuity, Inc.), and any
division, subsidiary, affiliate, or parent corporation of any of the foregoing.
"GTE Internetworking Network" includes, without limitation, GTE
Internetworking's networks, and all systems, services, and products that
utilize, or are utilized in connection with, GTE Internetworking's Networks.
CONFORMANCE WITH POLICIES OF OTHER ISPs
In situations where data communications are carried across networks of other
Internet Service Providers (ISPs), users of the GTE Internetworking Network must
also conform to the applicable acceptable use policies of such other ISPs.
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QUESTIONS, COMMENTS, OR COMPLAINTS
If you are unsure whether any contemplated use or action is permitted, please
send questions or comments to GTE Internetworking at: mailto:[email protected]
Any complaints regarding prohibited use or other abuse of the GTE
Internetworking Network, Including violations of this Acceptable Use Policy,
should be sent to GTE Internetworking at: [email protected].
REVISIONS
GTE Internetworking reserves the right to modify this Acceptable Use Policy at
any time without notice.
II. COMPLIANCE
GENERAL
All users of the GTE Internetworking Network are required to comply with this
Acceptable Use Policy, as well as all applicable laws and regulations.
GOALS
GTE Internetworking seeks to promote a high level of responsible behavior in
connection with the Internet, and has formulated this Acceptable Use Policy to
accomplish the following goals:
o To protect the reputation and resources of GTE Internetworking, its
customers, and the Internet community at large, from irresponsible or
illegal activities.
o To ensure the privacy, security, and reliability of the GTE
Internetworking Network, the network and systems of GTE Internetworking"
customers, and (as much as GTE Internetworking is reasonably able to do
so) the Internet at large.
o To establish guidelines for the acceptable use of the GTE Internetworking
Network.
o To define generally those actions which GTE Internetworking considers
abusive and prohibited.
o To outline procedures for handling and reporting abuse to GTE
Internetworking.
RESPONSIBILITIES
GTE Internetworking provides an unfiltered connection to the Internet. No data,
documents, materials, or information that enters the GTE Internetworking Network
is reviewed before being transmitted to users. Accordingly, GTE Internetworking
neither controls nor accepts responsibility for the content of any
communications that are transmitted or make available to users, regardless of
whether they originated from users of the GTE Internetworking Network. In
addition, GTE Internetworking expressly disclaims any responsibility for the
accuracy or quality
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<PAGE> 38
of information provided by third parties that may be obtained through the use of
the GTE Internetworking Network.
Each user is responsible for complying with this Acceptable Use Policy, and for
providing reasonable assistance to GTE Internetworking in investigating and
resolving issues, problems, and/or complaints arising out of the services
provided to such user.
FILTERS
Filters against particular networks or traffic types are generally available
from a variety of sources. For information about some commercial filters that
are currently available for residential use, see http://www.gte.net. In
addition, in certain circumstances and for an applicable fee, GTE
Internetworking may be able to install other filters upon the customer's
request.
CONFIGURATION
All users of the GTE Internetworking Network are responsible for configuring
their own systems to provide the maximum possible accountability. For example,
users should ensure there are clear "path" lines in news headers so that the
originator of a post may be identified. Users should also configure their Mail
Transport Agents (MTA) to authenticate (by look-up or the name or similar
procedures) any system that connects to perform a mail exchange, and should
generally present header data as clearly possible. As another example, users
should maintain logs of dynamically assigned IP addresses.
REPORTING VIOLATIONS
Customers of GTE Internetworking are responsible for immediately reporting to
GTE Internetworking (via e-mail or phone) any network issue which could
compromise the stability, service or security of any use by GTE Internetworking
or its customers of the GTE Internetworking Network.
RESELLERS AND DOWNSTREAM SERVICE PROVIDERS
Some users may be customers of Internet Service Provider (ISPs) that receive
Internet connectivity through GTE Internetworking. Such ISPs (also known as
resellers or downstream service providers) are responsible for informing their
customers of this Acceptable Use Policy and for enforcing its restrictions with
regard to their customers' actions.
Complaints about customers of any such reseller or downstream service provider
shall be forwarded to such reseller or downstream service provider for
resolution. If at time GTE Internetworking determines that such reseller or
downstream service provider is not taking appropriate action in accordance with
this Acceptable use Policy, GTE Internetworking shall work with such reseller or
downstream service provider to review their policies and enforcement procedures.
If the reseller or downstream service provider continues to fail to take
appropriate action, GTE Internetworking will take such further action as it
deems appropriate, up to and including termination proceedings.
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Violations of this Acceptable Use Policy by a customer or end-user of a reseller
or downstream service provider shall be considered violations of this Acceptable
Use Policy by such reseller or downstream service provider.
III. CONSEQUENCES OF NON-COMPLIANCE
Violation of this Acceptable Use Policy is strictly prohibited. In the event of
any actual or potential violation. GTE Internetworking reserved the right to
suspend or terminate either temporarily or permanently, any or all services
provided by GTE Internetworking to block any abusive activity, or to take any
other actions as deemed appropriate by GTE Internetworking in its sole
discretion. Users who violate this Acceptance Use Policy may incur criminal or
civil liability. GTE Internetworking may refer violators to civil or criminal
authorities for prosecution and will cooperate fully with applicable government
authorities in connection with the civil or criminal investigations of
violations.
IV. PROHIBITED USE
The examples of prohibited use set forth below and throughout this Acceptable
Use Policy are non-exclusive, and are provided as guidelines to customers and
other users of the GTE Internetworking Network.
A. ILLEGAL USE
The GTE Internetworking Network may be used only for lawful purposes. The
transmission, distribution, or storage of any information, data, or material in
violation of any applicable law or regulation is prohibited. Without limitation
of the foregoing, it is strictly prohibiting to create, transmit, distribute, or
store any information, data, or material which:
o Infringes any copyright, trademark, trade secret, or other intellectual
property right.
o Is obscene or constitutes child pornography.
o Is libelous, defamatory, hateful, or constitutes and illegal threat or
abuse.
o Violates export control laws or regulations.
o Encourages conduct that would constitute a criminal offense or give rise
to civil liability.
In the event of suspected, alleged, or actual illegal activity, GTE
Internetworking will notify or cooperate with applicable law enforcement
authorities for potential civil or criminal investigation or prosecution.
B. ABUSE
The following general actions are considered "abuse" and are strictly
prohibited:
Any conduct which violates the accepted norms and expectations of the Internet
community at large (whether or not detailed in this Acceptable Use Policy). GTE
Internetworking reserves the
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right, in its sole discretion, to make a determination whether any particular
conduct violates such norms and expectations.
Resale of GTE Internetworking's services or products, unless expressly
authorized in a separate written agreement with GTE Internetworking.
o Any conduct that restricts or inhibits any other user, whether a
customer of GTE Internetworking or a user of any other system or
network, from using or enjoying any of GTE Internetworking's services or
products, as determined by GTE Internetworking in its sole discretion.
o Harassment, whether through language, frequency, or size of messages.
o Creating, forwarding, posting, or distribution of chain messages of any
type (also known as "pyramid" or "Ponzi" schemes).
o Forging of message headers or a sender's identity, or taking any similar
action with the intent of bypassing restrictions or limits on access to
a specific service or site (such as a moderated newsgroup or a site
utilizing filters). This prohibition does not restrict the legitimate
use of aliases or anonymous re-mailers.
o Falsifying identity or contact information (whether given to GTE
Internetworking, to the InterNIC, or put in a message header) to
circumvent this Acceptable Use Policy. This prohibition does not
restrict the legitimate use of aliases or anonymous re-mailers.
o Furnishing false or incorrect data to GTE Internetworking on written or
online applications, contracts, or other materials or formation provided
to GTE Internetworking, including fraudulent use of credit card numbers
or "bill to" telephone numbers.
o Attempting to circumvent or alter the processes or procedures to measure
time, bandwidth utilization, or other methods to document use of GTE
Internetworking's products and services.
C. SECURITY
Violations of system or network security are prohibited, and may result in
criminal and civil liability. GTE Internetworking will investigate potential
security violations, and may notify applicable law enforcement agencies if
violations are suspected.
It is strictly prohibited to attempt to circumvent the authentication procedures
or security of any host, network, network component, or account (i.e.,
"cracking") to access data, accounts, or servers which the user is not expressly
permitted or authorized to access. This prohibition applies whether or not the
attempted intrusion is successful, and includes unauthorized probes or scans
performed with the intent to gather information on possible security weaknesses
or exploitable configurations.
Users of the GTE Internetworking Network are responsible for educating
themselves and configuring their systems with at least basic security. Should
systems at a user's site be violated,
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the user is responsible for reporting the violation and then fixing the
exploited system. For instance, should a site be abused to distribute unlicensed
software due to a poorly configured FTP (File Transfer Protocol) Server, the
user is responsible for re-configuring the system to stop the abuse.
Users are prohibited from interfering or attempting to interfere with service to
any other user, host, or network on the Internet ("denial of service attacks").
Examples of such prohibited activity include without limitation (a) sending
massive quantities of data (i.e., "flooding" with ICMP, SMTP, or any other type
of traffic that exceeds accepted norms of size and/or frequency) with the intent
of filling circuits, overloading systems, and/or crashing hosts, (b) attempting
to attack or disable any user, host, or site, or (c) using, distributing, or
propagating any type of program, script, or command designed to interfere with
the use, functionality, or connectivity of any Internet user, host, system, or
site (for example, by propagating messages, via e-mail, ______ posting, or
otherwise, that contain computer worms, viruses, control characters or Trojan
horses).
Users are prohibited from intentionally or negligently injecting false data into
the Internet, for instance in the form of bad routing information (including but
not limited to the announcing of networks owned by someone else or reserved by
the Internet Assigned Numbers Authority) or incorrect DNS information.
D. E-MAIL
User are prohibited from engaging in improper use or distribution of electronic
mail ("e-mail") over the Internet. Without limitation of the foregoing, it is
strictly prohibited to engage in any of the following activities:
o Sending unsolicited bulk e-mail ("UBE", or "spamming"). This includes, but
is not limited to, the distribution of UBE for commercial, informational,
advertising, political, or religious purposes.
o Setting up "mailback" or "drop box" addresses in order to receive
responses from UBE, either directly by the user or by a third party on
behalf of the user.
o Using a mail transport agent (MTA) outside of a user's own site to relay
mail (unless a user has received express permission to do so). Even if
permission has been received, users are prohibited from forging their
identities to make it appear as though the e-mail sourced from the relay.
o Sending UBE, or posting news, to advertise or promote resources whose
connectivity depends in any way on the GTE Internetworking Network,
regardless of whether such UBE or news posting is made using the GTE
Internetworking Network. For example, using another ISP's services to send
UBE which advertises a web page hosted by or via the GTE Internetworking
Network is prohibited.
o Hiring or using any third party service for the purpose of distributing
UBE or excessively "multi-posting" or "cross-posting" any ______ posting
in the name of a user. Users will be
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held responsible for the actions of any third party agent that acts on
behalf of or for the benefit of the user, and such users shall be held
directly accountable for any violations of this Acceptable User Policy by
such third party agent.
o Bulk e-mail may be sent only to recipients who have expressly requested
receipt of such e-mail. Users that send solicited bulk e-mail are required
to maintain records of all bulk e-mail subscription requests, and to
provide GTE Internetworking with such records upon request of GTE
Internetworking, to enable GTE Internetworking to investigate complaints
from third parties. The sender of any solicited bulk e-mail shall, upon
the request of a recipient, immediately remove such recipient from all
applicable mailing lists and refrain from further transmissions of e-mail
to such recipient.
o Use of any auto-responder messages, mailing lists, or any other programs
or scripts run by a user to handle or re-distribute e-mail is the sole
responsibility of the user, and shall be operated in a reasonable manner.
This responsibility includes, but is not limited to, maintaining
up-to-date mailing lists to minimize mail bouncing and to facilitate the
processing of removal requests, configuring auto-responders so that they
do not create mail loops, and the prompt handling of any complaints
regarding UBE re-distributed through a mailing list onsite.
E. UNSENET (ALSO KNOWN AS NETNEWS OR NEWSGROUPS)
GTE Internetworking recommends that users not post to any newsgroup until they
have familiarized themselves with the subjects, established guidelines, and
restrictions of such newsgroup. All Usenet guidelines and restrictions are
incorporated herein by reference, and users of the GTE Internetworking Network
agree to adhere to such guidelines unconditionally.
Without limitation of the foregoing, it is strictly prohibited to engage in any
of the following activities:
o Making any posting for commercial purposes (including without limitation
the pointing to specific URLs for commercial purposes), except where such
postings are expressly permitted under the charter and/or Frequently Asked
Questions (FAQ) of an applicable newsgroup.
o Posting binary files to newsgroups whose charter or name does not include
allowances for such files.
o Posting via GTE Internetworking's newsfeed any solicitation for mailback
to an e-mail address (including addresses of non-GTE Internetworking
users) networks with the intention of bypassing this Acceptable Use
Policy.
o Canceling newsgroup posting other than their own, or using auto-responders
or cancel-bots (or similar automated or manual routines) which generate
excessive network traffic or disrupt Usenet newsgroup/e-mail use by others
(except in cases of official newsgroup moderators performing their
duties).
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o Engaging in "Excessive Cross-Posting" (ECP) or "Excessive Multi-Posting"
(EMP) or "Usenet spam" (no matter what the content might be) as defined by
the Internet community and expressed in the news.admin.net-abuse."
Newsgroups and FAQs.
o Disrupting newsgroups with materials, postings, or activities that are (as
determined by GTE Internetworking in its sole discretion) frivolous,
unlawful, obscene, threatening, abusive, libelous, hateful, excessive, or
repetitious, unless such materials or activities are expressly allowed or
encouraged under the newsgroup's name, FAQ, or charter.
o Using filtering messages (e.g., NoCoM) in an intrusive manner, or at other
than the user's server level. Generally, filtering messages are considered
normal Usenet traffic and are treated as such by GTE Internetworking.
Complaints regarding filter use or abuse should be directed either to the
source generating them or the sites utilizing them.
o Performing any authorized creation, cancellation, or removal of
newsgroups.
The legitimacy of a given post or cancellation is determined by the official
newsgroup or mailing-list moderator. Therefore, GTE Internetworking defers to
their judgment on these issues. If no such official entity exists, it is at GTE
Internetworking's discretion to determine whether any post or cancellation is
complaint with this Acceptable Use Policy and Internet community standards for
that newsgroup.
F. WORLD WIDE WEB
GTE Internetworking strictly prohibits users from engaging in any of the
following web-related activities:
o The exploitation or attempted exploitation of any scripts presented on web
pages (e.g., forms for answering questions or for entering data).
o Excessive use of bandwidth by utilizing programs, scripts, or commands to
abuse a web site (for example, by connecting for an excessive amount of
time, repeatedly engaging site-local scripts, or related behavior).
o "Walking" a database for the purpose of collecting data contained therein
(whether or not this behavior requires that the reader of the page must
knowingly ignore files such as "robot.txt" which is designed to guide
cataloguing robots/programs).
o Operating a robot on a site's page after the site has asked that the
behavior cease.
o Configuring a web page to act maliciously against users that visit that
web page.
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V. LEGAL
ADDITIONAL TERMS AND CONDITIONS
The use of the GTE Internetworking Network by a customer of GTE Internetworking
is subject to the terms and conditions of any agreements entered into by such
customer with GTE Internetworking. This Acceptable Use Policy is incorporated
into such agreements by reference.
LIMITATION OF LIABILITY
GTE INTERNETWORKING SHALL NOT BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL,
CONSEQUENTIAL, OR PUNITIVE DAMAGES, INCLUDING BUT NOT LIMITED TO LOSS OF
PROFITS, LOSS OR BUSINESS OR BUSINESS OPPORTUNITY, LOSS OF USE, ETC., EVEN IF
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. GTE INTERNETWORKING SHALL NOT BE
LIABLE FOR ANY DIRECT OR ACTUAL DAMAGES, EXCEPT TO THE EXTENT SPECIFIED IN A
WRITTEN OR ELECTRONIC AGREEMENT ENTERED INTO BETWEEN GTE INTERNETWORKING AND ITS
CUSTOMER.
GTE INTERNETWORKING MAKES NO WARRANTIES OR REPRESENTATIONS HEREIN, EITHER
EXPRESS OR IMPLIED, CONCERNING THE GTE INTERNETWORKING NETWORK, AND EXPRESSINGLY
DISCLAIMS WARRANTIES OF FITNESS FOR A PARTICULAR USE OR PURPOSE THE WARRANTY OF
MERCHATABILITY OR ANY OTHER WARRANTY IMPLIED BY LAW.
VI. COMPLAINTS AND CONTACT INFORMATION FOR GTE (BBNPLANET) CUSTOMERS
Any complaints regarding prohibited use or other abuse of the GTE
Internetworking Network, including violations of this Acceptable Use Policy,
should be sent via e-mail to GTE Internetworking at: [email protected]. Please
include all applicable information that will assist GTE Internetworking in
investigating the complaint, including all applicable headlines of forwarded
messages.
Sites experiencing live attacks from GTE Internetworking customers should call
into our Customer Care Center (telephone 617-873-8601) to submit a complaint as
quickly as possible. Describe the urgency of the situation should you need
immediate attention.
If you are unsure whether any contemplated use or action is permitted, please
send questions or comments to GTE Internetworking at: [email protected].
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For further information about this Acceptable Use Policy, please contact GTE
Internetworking at:
GTE Internetworking
150 Cambridge Park Drive
Cambridge, MA 02140
Attention: Network Operations Center - Internet Security Officer
Telephone: 1-800-632-7638 or 1-617-873-8601
http://www.bbn.com
[email protected] - Reports of Network Abuse or Complaints about Unsolicited
Commercial E-mail/Mass E-mail
[email protected] - Operational Issues and Requests
Information Request Form - Sales Inquiries
VII. COMPLAINTS AND CONTACT INFORMATION FOR GTE.NET CUSTOMERS
Any complaints regarding prohibited use or other abuse of the GTE
Internetworking Network, including violations of this Acceptable Use Policy,
should be sent via e-mail to GTE Internetworking at: [email protected]. Please
include all applicable information that will assist GTE Internetworking in
investigating the complaint, including all applicable headlines of forwarded
messages.
Sites experiencing live attacks from GTE Internetworking customers should call
into our Customer Care Center (telephone 800-927-3000) to submit a complaint as
quickly as possible. Describe the urgency of the situation should you need
immediate attention.
If you are unsure whether any contemplated use or action is permitted, please
send questions or comments to GTE Internetworking at:
[email protected]
For further information about this Acceptable Use Policy, please contact GTE
Internetworking at:
GTE Internetworking
P.O. Box 152212
Irving, TX 75015-2212
Attention: Electronic Abuse - Messaging Services
http://www.gte.net
[email protected] - Reports of Network Abuse or Complaints about Unsolicited
Commercial E-mail/Mass E-mail and News abuse.
10
<PAGE> 46
[email protected] - Reports of hacking, suspected criminal activity, child
pornography, copyright infringements, electronic harassment.
[email protected] - Operational Issues and Requests
[email protected] - Sales Information
11
<PAGE> 1
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
EXHIBIT 10.11
VIRTUAL INTERNET PROVIDER (VIP) AGREEMENT
This Agreement is made in the city of Fairfax, Virginia, this 9th day of January
1997, between UUNET Technologies, Inc., whose address is 3060 Williams Drive,
Fairfax, Virginia 22031 (UUNET), and i-Pass Alliance Inc., (Reseller), whose
address is 650 Castro Street, Suite 280 Mountain View, CA 94041.
The parties hereto agree and bind themselves as follows:
1. SERVICE. UUNET will sell, and Reseller will purchase, telecommunications
services for the interconnection of Reseller's end users with the Internet.
Reseller is responsible for all end-user customer support, billing, and
collections. UUNET's relationship under this Agreement is solely with Reseller
and not with any of reseller's end users. UUNET agrees that its
telecommunications services provided to Reseller will be of a quality usual and
customary in the industry for similarly situated companies. Although it is
understood that UUNET cannot guarantee continuous service, UUNET agrees to
provide prompt reparation of any disruption in services to the extent reasonably
possible consistent with its obligations to other customers. To this end, UUNET
agrees to provide Reseller with a toll-free number to report problems relating
to network integrity. This number is to be used only by Reseller and will not be
released to Reseller's customers.
2. PRICING. For PPP dial-up traffic (analog dial, 28.8Kbps and ISDN) and VIP
radius server interoperability, the prices contained in Schedule A apply. For
all other services, UUNET's list prices apply unless other prices have been
specifically established.
3. TERMS AND CONDITION. Reseller agrees to comply with the Network Services
Terms and Conditions contained in Schedule B. It further agrees to require its
end users to comply with terms and conditions in substance identical to those in
Sections One and Two of Schedule B. Reseller shall defend, indemnify, and hold
harmless UUNET against any claims resulting from Reseller's use of UUNET's
services, or that of its customers throughout its chain of distribution.
4. PUBLICITY. The prices and terms of this Agreement shall be held confidential
by both parties. Neither party shall publicize the existence of this agreement
without the consent of the other, and in the event of such agreement, all press
release materials shall be reviewed and approved by the other party.
5. TECHNICAL AGREEMENT. Reseller agrees to comply with the Technical Agreement
for Network Interoperability, attached as Schedule C.
6. TERM. The term of this Agreement is one year from the date of contract
signature, which term shall be automatically renewed for additional one year
terms, provided that neither party has delivered to the other party a written
notice of intent not to renew for the forthcoming term. Such notice of intent
shall be given not less than sixty (60) days in advance of the end of the
current term.
7. TERMINATION. Either party may terminate this Agreement for cause without
penalty in the event that the other party hereto breaches any material term of
this Agreement. Prior to such termination, the party intending to terminate
shall first give the other party written notice of its
1.
<PAGE> 2
intent to terminate which shall clearly describe problem(s) constituting cause.
The other party will have thirty (30) days from the date of receipt of such
notice to correct the problem. If the problem is not corrected within such
period, the party intending to terminate may terminate this Agreement on such
30th day. However, if Reseller shall violate the acceptable use policy in
Section 2 of Schedule B, or permit such violation, and does not immediately act
to remedy such violation when it becomes aware of it, UUNET may terminate this
Agreement without penalty with ten (10) days written notice. If any amounts due
and owing by Reseller remain unpaid sixty (60) days after date of invoice, then
UUNET may terminate this Agreement immediately upon written notice without
penalty.
8. TESTING. The full effectiveness of this contract will be contingent upon the
completion of technical testing to the mutual and reasonable satisfaction of
both parties during the period of thirty (30) days following execution of this
Agreement. If either party shall reasonably declare the testing results to be
unsatisfactory at the conclusion of this thirty (30) day period, then the
parties shall have another ten (10) days to correct the problem. If such
correction is not completed to the mutual and reasonable satisfaction of the
parties then this Agreement will terminate with not further liability to either
party. If no such declaration is made, acceptance of technical testing shall be
presumed, and the contract shall remain in effect. Monthly minimums will begin
to accrue from the date of the satisfactory completion of technical testing. If
testing is completed during the course of a month, the first month's minimum
commitment will be prorated to reflect the shortened month.
9. LIMITATION OF LIABILITY. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY
STATED OR IMPLIED HEREIN, NEITHER PARTY SHALL HAVE ANY LIABILITY WHATSOEVER FOR
ANY INCIDENTAL CONSEQUENTIAL OR SPECIAL DAMAGES SUFFERED BY THE OTHER OR BY ANY
ASSIGNEE OR OTHER TRANSFEREE OF THE OTHER, EVEN IF INFORMED IN ADVANCE OF THE
POSSIBILITY OF SUCH DAMAGES, EXCEPT IN CONNECTION WITH THE INDEMNIFICATION
PROVISIONS OF SECTION 3 OF THIS AGREEMENT AND SECTION 2 OF SCHEDULE B.
10. GOVERNING LAW. This Agreement and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the Commonwealth
of Virginia, USA, and the parties agree that any appropriate state or district
court located in Fairfax County, VA, shall have exclusive jurisdiction over any
case of controversy arising hereunder, and shall be the proper forum in which to
adjudicate such case or controversy.
11. ENTIRE AGREEMENT. The parties hereto acknowledge that they have read this
entire Agreement and that this Agreement and the exhibits attached hereto
constitute the entire understanding and contract between the parties and
supersedes any and all prior or contemporaneous oral or written communications
with respect to the subject matter hereof. This Agreement shall not be modified,
amended or in any way altered except by an instrument in writing signed by the
parties.
12. RELATIONSHIP OF PARTIES. No agency, partnership, joint venture or employment
is created as a result of this Agreement. Neither party is authorized to bind
the other in any respect whatsoever.
2.
<PAGE> 3
13. BINDING EFFECT. Except as herein otherwise specifically provided, this
Agreement shall be binding upon and inure to the benefit of the parties and
their legal representatives, heirs, administrators, executors, successors and
assigns.
14. FORECASTS. Reseller shall provide UUNET with initial and periodically
revised forecasts of its expected usage, and recognizes UUNET's reliance upon
the reasonable accuracy of these forecasts. Specifically, during the first week
of each calendar month. Reseller shall provide UUNET with its best forecast of
users and hours for each remaining month of the terms of the Agreement. Reseller
shall also provide UUNET with any information as to marketing programs which
will be helpful in determining expected future loads, particularly any
information relevant to expected loads in particular geographical
locations/POPs.
15. CONFIDENTIALITY. The parties agree that all disclosures of confidential
and/or proprietary information during the term of this Agreement shall
constitute confidential information of the disclosing party. Each party shall
use its best efforts to ensure the confidentiality of such information supplied
by the disclosing party, or which may be acquired by either in connection with
or as a result of the provision of the services under this Agreement. Both
parties warrants that they shall not disclose, use, modify, copy, reproduce, or
otherwise divulge such confidential information. Both parties further agree to
prevent its employees and representatives from disclosing, using, modifying,
copying, reproducing, or otherwise divulging such confidential information, and
shall hold each other harmless and protect and indemnify the same in the event
of any disclosure by said persons. The terms of this Section 15 shall continue
beyond the term of this Agreement and shall be binding and enforceable even
after the termination of this Agreement.
16. PLURAL/GENDER. Whenever from the context it appears appropriate, each term
stated in either the singular or the plural shall include the singular and the
plural, and pronouns stated in the masculine, the feminine or the neuter gender
shall include the masculine, feminine and neuter. The term "person" means any
individual, corporation, partnership, trust or other entity.
17. SEVERABILITY. If any provision of this Agreement, or the application of such
provision to any person or circumstance, shall be held invalid, the remainder of
this agreement, or the application of such provision to persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.
18. COUNTERPARTS. This Agreement may be executed in several counterparts, each
of which shall be deemed an unlawful but all of which, when taken together,
shall constitute one and the same instrument. It shall not be necessary for all
parties to execute the same counterpart hereof.
19. WAIVER. No failure on the part of either party to exercise, and no delay in
exercising any right or remedy hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any right or remedy hereunder preclude
any other or further exercise thereof or the exercise of any other right or
remedy granted hereby or by law.
20. NOTICE. Unless otherwise provided, any notice to be given hereunder shall be
effective on the fifth day after dispatch. Such notice shall be sent by first
class mail, postage prepaid and
3.
<PAGE> 4
metered for delivery by certified or registered mail, receipt requested,
addressed to the parties listed below at their respective places of business, or
at such other addresses of which notice has been given to the addressing party:
If to Reseller: If to UUNET Technologies, Inc.
i-Pass Alliance Inc. UUNET Technologies, Inc.
650 Castro St., Suite 280 3080 Williams Drive
Mountain View, CA 94041 Fairfax, VA 22031
21. ASSIGNMENT. This Agreement shall not be assignable by either party hereto
without the prior written consent of the other party.
22. FORCE MAJEURE. No party shall be liable by reason of any failure or delay in
the performance of its obligations due to strikes, riots, fires, explosions,
acts of God, war, governmental action or any other cause which is beyond the
reasonable control of such party.
23. COMPLIANCE WITH LAWS. Each party shall comply with all laws, regulations and
other legal requirements that apply to this Agreement. UUNET hereby warrants
that, to its knowledge, it has complied with all laws, regulations, and order
relating or pertaining to this provision of the services to be provided under
this Agreement, including without limitation, all applicable state or federal
legislation or rule applicable to the services in any material respect. To the
knowledge of UUNET, material permits, licensees, and authorizations required by
any regulatory bodies have been obtained and are in effect for the services.
24. FACSIMILE TRANSMISSION. Parties to this Agreement, and authorized to execute
this Agreement, and transmit a signed copy of same via fax to the other parties,
who hereby agree to accept and rely upon such documents as if they bore original
signatures. The parties sending such facsimiles hereby acknowledge and agree to
provide to the other parties, within seventy-two (72) hours of transmission, the
Agreement bearing an original signature.
IN WITNESS WHEREOF, the parties hereto have set their hands and signed, as of
the date first above written.
I-PASS ALLIANCE INC. UUNET TECHNOLOGIES, INC.
By: /s/ CHRISTOPHER MOORE By: /s/ CLINT HEIDEN
------------------------ ---------------------------------
Name: Christopher Moore Name: Clint Heiden
---------------------- -------------------------------
Title: President & CEO Title: VP of Sales
--------------------- ------------------------------
4.
<PAGE> 5
SCHEDULE A
DIAL-UP AND VIP ?? SERVER PRINCIPAL MINIMUM MONTHLY COMMITMENT
1. DIAL-UP PRICING
<TABLE>
<CAPTION>
MONTHLY VOLUME IN HOURS COST/HOUR
<S> <C>
Up to 99,999 [*]
100,000 - 149,999 [*]
150,000 - 249,999 [*]
250,000 - 499,999 [*]
500,000 and above [*]
</TABLE>
The above rates are for PPP dial-up traffic, in the continental United States
only.
There will be a 10% surcharge to the above rates for ISDN connectivity.
UI traffic in a given month will be billed at the category reflecting the total
number of hours consumed in a month.
Pricing for international and non-continental US sites will be provided as UUNET
is able to offer such services and shall be attached to this Agreement as an
additional schedule.
2. MINIMUM MONTHLY COMMITMENT
Monthly commitments have been waived.
3. VIP RADIUS SERVER PRICING
Reseller will pay a one-time installation charge of [*] due upon contract
signature and a [*] per month fee for Radius server Interoperability.
4. ADDITIONAL PRICE AND BILLING TERMS
If Reseller desires UUNET to provide billing data more frequently than on a
monthly basis, there will be an additional one-time charge of [*] and an
ongoing monthly charge of [*]/month for the transmission of weekly billing
data. This charge will be waived when the monthly volume reaches 100,000 hours.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
1.
<PAGE> 6
SCHEDULE B
NETWORK SERVICES VIP TERMS AND CONDITIONS
1. UUNET exercises no control whatsoever over the content of the information
passing through UUNET. Except as otherwise provided for in Section Ten of the
Network Services Agreement attached hereto, UUNET makes no warranties of any
kind, whether expressed or implied, for the service it is providing. UUNET also
disclaims any warranty or merchantability or fitness for a particular purpose.
UUNET will not be responsible for any damage Reseller suffers. This includes
loss of data resulting from delays, nondeliveries, misdeliveries, or service
interruptions caused by Reseller's own negligence or Reseller's errors or
omissions. Use of any information obtained via UUNET is at the user's own risk.
UUNET specifically denies any responsibility for the accuracy or quality of
information obtained through its services.
2. UUNET's network may be used only for lawful purposes. Use of UUNET's network
for lawful commercial purposes is both permitted and encouraged. Transmission of
any material in violation f any applicable law is prohibited. This includes, but
is not limited to: copyrighted material, material which is threatening or
obscene, or material protected by trade secret. Any access to other networks
connected to UUNET's network must comply with the rules appropriate for the
other network. Reseller agrees to indemnify and hold harmless UUNET from any
claims resulting from Reseller's use of the service or the use of the service by
any of Reseller's customers or others throughout Reseller's chain of
distribution, including end users, which damages UUNET or another party.
3. Resale to other individuals and organizations is permitted, but they may not
further resell the services.
4. Payment is due thirty (30) days after date of invoice. Accounts are in
default if payment is not received within thirty (30) days after date of
invoice. Accounts unpaid sixty (60) days after date of invoice may have service
interrupted. Such interruption does not relieve Reseller from the obligation to
pay the monthly charge. Only a written request to terminate service relieves it
of the obligation to pay the monthly account charge. Accounts in default are
subject to an interest charge of one-and-one-half percent (1.5%) per month on
the outstanding balance. If Reseller's state does not allow an interest rate of
one-and-one-half-percent (1.5%), then the maximum allowable rate will be
charged. Reseller agrees to pay UUNET its reasonable expenses, including
attorney and collection agency fees, incurred in enforcing UUNET's rights under
this Agreement for money due and owing.
5. These Terms and Conditions supersede all previous representations,
understandings or agreement sand shall prevail notwithstanding any variance with
terms and conditions of any order submitted. Use of UUNET's network constitutes
acceptance of these Terms and Conditions.
1.
<PAGE> 7
SCHEDULE C
TECHNICAL AGREEMENT FOR NETWORK INTEROPERABILITY
1. Reseller agrees to secure a minimum 11 connection from UUNET and operate its
own Radius server. Such server will perform user validation functions, and
will be maintained in a secure environment. Reseller also will maintain this
server with reasonably current versions of the Radius protocols as provided
by UUNET.
2. Reseller agrees to use software and procedural safeguards to insure that
only accurate routing information for networks to be used by Reseller's
customers is transmitted from Reseller's Radius server into UUNET's network and
to use best efforts to immediately remedy any problems leading to transmission
of incorrect routing information.
3. Reseller agrees to assign each end user customer a unique identification
number for billing purposes, and to reasonably cooperate with UUNET in
establishing the structure of this identification number.
4. Reseller and UUNET each agree to cooperate with the other in identifying and
resolving any security infringements which involve Reseller's customers and
UUNET's network.
5. It is recognized and agreed that any billing data supplied on an interim
basis (more frequently than monthly) is an estimate and may not be relied upon
for 100% accuracy.
2.
<PAGE> 8
ADDENDUM NO. 1 TO
NETWORK SERVICES AGREEMENT
This Addendum No. 1 (the "Addendum") to Network Services Agreement
between UUNET Technologies, Inc. ("UUNET") and I-Pass Alliance, Inc.
("Reseller"), dated January 7, 1997 (the "Agreement") is made as of February 5,
1997.
The parties agree as follows:
1. Surcharged North American POPs. The parties desire to provide for the
resale by Reseller of access to UUNET's POPs listed in Section 1 of the attached
Schedule E (the "Additional POPs") effective as of November, 1996. UUNET shall
make such access available upon execution of this Addendum by both parties,
subject to commercialization of any such POPs. Reseller agrees to pay to UUNET
the prices set forth in Section 2 of the attached Schedule E for access to the
additional POPs.
2. International Roaming. Reseller agrees to pay to UUNET the prices set
forth in Section 3 of the attached Schedule E for access by customers of
Reseller who reside in the United States, Alaska, Hawaii, Puerto Rico or Canada
from any one of UUNET's POPs outside of the continental United States, Alaska,
Hawaii, Puerto Rico or Canada subject to commercialization of any new POPs.
3. Ratification. The parties hereby affirm and ratify their respective
rights and obligations under the Agreement, which Agreement shall remain in full
force and effect, as modified by this Addendum.
IN WITNESS WHEREOF, the parties hereto have set their hands as of the
date first above written.
I-PASS ALLIANCE, INC. UUNET TECHNOLOGIES, INC.
By: /s/ CHRIS MOORE By: /s/ CLINT HEIDEN
------------------------ ---------------------------------
Name: Chris Moore Name: Clint Heiden
---------------------- -------------------------------
Title: President & CEO Title: VP of Sales
--------------------- ------------------------------
1.
<PAGE> 9
SCHEDULE E
ADDITIONAL POPS
1. Additional POPs
<TABLE>
<S> <C> <C>
AB CALGARY 403-781-5200
AB EDMONTON 403-423-5600
BC VANCOUVER 604-602-1506
MB WINNIPEG 204-956-1440
ON OTTAWA 610-941-9491
ON TORONTO 416-363-9625
QB MONTREAL 514-866-7181
AK ANCHORAGE 907-272-9547
AK JUNEAU 907-163-5355
HI HONOLULU 808-536-0241
PR SAN JUAN 787-289-5841
</TABLE>
- ----------
2. PRICING
There will be a [*] (U.S.) surcharge per hour for access from the POPs listed
in Section 1 to the rates provided in the Network Services Agreement referenced
above.
3. INTERNATIONAL ROAMING ACCESS PRICING
Access from any one of UUNET's POPs outside of the continental United States,
Alaska, Hawaii, Puerto Rico or Canada will be subject to a [*] (U.S.)
surcharge per hour.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
1.
<PAGE> 10
AMENDMENT NO. 1
This Amendment No. 1 ("Amendment") to the Virtual Internet Provider (VIP)
Agreement between UUNET Technologies, Inc. ("UUNET") and I-Pass Alliance, Inc.
("Reseller"), dated January 8, 1997 ("Agreement") is made as of the date of the
second signature below.
The parties agree to add the following Sections to Schedule A of the Agreement
as follows:
5. RADIUS ACCOUNTING AND PRICING
UUNET will provide Radius Accounting, a method of measuring End Users'
use of the services consisting of login and logout statistics of each
End User, at Reseller's written request. Reseller has the sole
responsibility to analyze these statistics to identify and investigate
duplicate log-ins and take appropriate action. The statistics are not to
be used as a method for calculating monthly charges for UUNET services,
as the definitive calculation of Reseller's monthly charges will be set
forth in the invoice provided Reseller on a monthly basis.
The Monthly Fee for Radius Accounting will be waived for six (6) months
from the date of the second signature below provided that monthly
charges paid by Reseller to UUNET increase by [*] over the charges in
the month prior to execution of this Amendment during each of the six
(6) months in which the fee for Radius Accounting was waived. If
Reseller does not increase its monthly charges by [*] during the six
(6) months in which the Radius Account fee was waived, Reseller will be
responsible for paying UUNET the amount which would have been due.
6. VIP TOLL FREE SERVICE
To allow Reseller's End users toll-free access to the UUNET Network, VIP
Toll Free service is available at a fee of [*]/hour. To activate VIP
Toll Free service, Reseller must notify UUNET in writing and provide a
reasonably accurate forecast of the peak simultaneous users of the
service expected in the next six months. UUNET will notify Reseller once
VIP Toll Free service has been activated and is available to Reseller's
End Users.
7. INTERNATIONAL PRICING
Price for International Access will be [*] per hour in countries in
which UUNET has points of presence, which UUNET may change from time to
time.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
1.
<PAGE> 11
Except as expressly provided herein, none of the provisions of the Agreement
shall be modified by this Amendment, and as hereby modified, the Agreement shall
remain in full force and effect. The parties acknowledge their agreement by
signing below.
i-PASS ALLIANCE INC. UUNET TECHNOLOGIES, INC.
By: /s/ CHRIS W. MOORE By: /s/ BRIAN KANE
------------------------ ---------------------------------
Name: Chris W. Moore Name: Brian Kane
---------------------- -------------------------------
Title: President & CEO Title: Director, Wholesale Sales
--------------------- ------------------------------
Date: May 4, 1999 Date: 8/5/99
---------------------- -------------------------------
2.
<PAGE> 12
AMENDMENT NO. 2
This Amendment No. 2 ("Amendment") to the Virtual Internet Provider Agreement
("VIP") between UUNET Technologies, Inc. ("UUNET") and I-Pass Alliance, Inc.
("Reseller"), dated January 9, 1997 ("Agreement") is made as of the date of the
second signature below ("Effective Date"). The Amendment also amends the
CompuServe Network Services Agreement for Managed Service Providers (MSP) dated
November 4, 1997 ("CompuServe NSA").
Whereas, the parties desire to amend the Agreement and the CompuServe NSA,
Whereas, UUNET is the successor in interest to CompuServe Network Services,
Inc., and has assumed the obligations and rights of CompuServe, Inc. under the
CompuServe NSA;
Now, therefore, in accordance with procedures for amendment of the Agreement and
the CompuServe NSA set forth therein, and in consideration of the foregoing and
the mutual agreements herein set forth, the parties hereby agree as follows:
The parties agree as follows:
1. The parties agree to extend the term of the Agreement and the term of
the CompuServe NSA for an additional three (3) years from the Effective
Date of this Amendment, which terms shall hereafter remain coterminous
and upon the expiration of such agreements shall be automatically
renewed for an additional one year term, provided that neither party has
delivered to the other a written notice of intent not to renew for the
forthcoming term not less than 60 days in advance of the end of the
then-current term.
2. Section 7 of the Agreement shall be replaced with the following:
This Agreement may not be terminated by either party except that either
party may terminate this Agreement if the other party materially
breaches the terms of this Agreement and does not cure the breach within
sixty (60) days after receipt of written notice of such breach, which
notice describes such breach in reasonable detail. Upon termination or
expiration of this Agreement for any reason other than Reseller's breach
of Reseller's payment or confidentiality obligations, at Reseller's
request the parties shall continue to perform all of their obligations
and maintain all of their rights under the Agreement for a phase-out
period of thirty (30) days from the date of termination or expiration.
However, if Reseller violates the Acceptable Use Policy in Section 2 of
Schedule B, or becomes aware of such a violation, and in either event
does not immediately act to remedy such violation when it becomes aware
of it, UUNET may terminate this Agreement without penalty with thirty
(30) days written notice, provided that service may be suspended without
prior notice to the extent necessary for UUNET to respond to a court or
government demand, or to preserve the integrity or normal operation of
the UUNET Network. Reseller shall be notified promptly of any material
suspension of service undertaken pursuant to the previous sentence.
3. Section 1 of Schedule A of the Agreement shall be replaced with the
following:
1.
<PAGE> 13
<TABLE>
<CAPTION>
MONTHLY MINIMUM AMOUNT COST FOR 3 YEAR TERM COMMITMENT
---------------------- -------------------------------
<S> <C>
[*] [*]/hour
</TABLE>
4. Section 2 of Schedule A of the Agreement shall be replaced with the
following:
Reseller agrees to a total Monthly Minimum Amount of [*] per month
for dial-up Internet access services from UUNET. If in any month the sum
of the actual charges for dial-up Internet access service under the
Agreement and the CompuServe NSA is less than [*] then Reseller
shall pay the applicable Monthly Minimum Amount in lieu of actual
charges.
5. In consideration for the Monthly Minimum Amount agreed to in Section 3
of this Amendment, UUNET will reduce the basic Rate Per Hour set forth
in Section 3.1 of the CompuServe NSA to [*] per hour. Surcharges and
other fees in the CompuServe NSA shall not be modified by this
Amendment.
6. The following shall be included in Section 2 of the Schedule B of the
Agreement
All use of the service or the UUNET Network shall comply with the UUNET
Acceptable Use Policy ("Policy") for the country in which the service is used,
as set forth at http://www.UU.net/terms. UUNET reserves the right to change the
Policy from time to time effective upon posting to that URL, and notice of any
such revised Policy will be included with Reseller's monthly invoice in the
month following the change. Reseller agrees to develop, maintain, and require
its customers to comply with an acceptable use policy containing terms at least
as restrictive as the Policy, as applicable, including any subsequent
modifications.
7. Section 3 of Schedule B of the Agreement shall be replaced with the
following:
Notwithstanding any other provision of this Agreement, Reseller shall
have the right to resell the Service to third parties through one or
more tiers of subdistributors, and to grant the right to its customers
to do the same, provided that all such customers or subdistributors
comply with the applicable terms of this Agreement.
8. The following shall be added as Schedule D to the Agreement.
SCHEDULE D
Reseller's suppliers of network services (the "Network Services
Suppliers") do not exercise any control whatsoever over the content of
the information passing through their systems, and access to the
Internet is provided solely on an "as is" basis. The Network Services
Suppliers do not warrant that the network will be available on a
specified date or time or that the network will have the capacity to
meet your demand during specific hours. The Network Services Suppliers
shall not be liable for any damage suffered by any person as a result of
Internet access, or arising out of any use, or inability to use, the
services or products provided hereunder, including, without limitation,
the possibility of contracting computer viruses and accessing
information with offensive, inaccurate, or inappropriate content. The
Network Services Suppliers shall not be liable for any damages suffered
by any person as a result of obtaining Internet access regardless of
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
2.
<PAGE> 14
whether such damage occurs as a result of the Network Service Suppliers'
negligence. You acknowledge and agree that all end users must exercise
their own due diligence before relying on any information available on
the Internet, and must determine that they have all necessary rights to
copy, publish, or otherwise distribute any such information available on
the Internet under copyright and other applicable laws. The Network
Services Suppliers shall be deemed to be third-party beneficiaries of
this agreement, with the right to enforce the terms of this Agreement.
THE NETWORK SERVICES SUPPLIERS DISCLAIM ALL WARRANTIES AND CONDITIONS OF
ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING WITHOUT LIMITATION
THE IMPLIED WARRANTIES OF TITLE, MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE AND NONINFRINGEMENT. THE NETWORK SERVICES SUPPLIERS
SHALL NOT BE LIABLE FOR ANY THIRD-PARTY NETWORK FAILURE.
IN NO EVENT SHALL THE NETWORK SERVICES SUPPLIERS BY LIABLE FOR ANY
SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, OR FOR ANY INTERRUPTED
COMMUNICATIONS, LOST DATA OR LOST PROFITS, ARISING OUT OF OR IN
CONNECTION WITH THE SERVICE.
All use of services offered by Reseller shall comply with Reseller's
Acceptable Use Policy.
9. The following shall be added as Section 10.12 to the CompuServe NSA:
Notwithstanding any other provision of this Agreement, Customer shall
have the right to resell the access services to the Internet provided by
CompuServe to third parties through one or more tiers of
subdistributors, and to grant the right to its customers to do the same,
provided that all such customers or subdistributors comply with the
applicable terms of this Agreement and terms and conditions in substance
identical to those in Schedule D of the Virtual Internet Provider
Agreement ("VIP") between UUNET Technologies, Inc. ("UUNET") and I-Pass
Alliance, Inc. ("Reseller"), dated January 9, 1997, as amended.
10. The second sentence of Section 3 of the Agreement shall be deleted and
replaced with the following:
; provided that UUNET gives its consent to Reseller's assignment of this
Agreement to the new Delaware corporation into which Reseller is to be
reincorporated contingent upon the corresponding assumption by that new
Delaware corporation of all rights and obligations under this Agreement.
3.
<PAGE> 15
Except as expressly provided herein, none of the provisions of the Agreement or
the CompuServe NSA shall be modified by this Amendment, and as hereby modified,
the Agreement and the CompuServe NSA shall remain in full force and effect. The
parties acknowledge their agreement by signing below.
i-PASS ALLIANCE INC. UUNET TECHNOLOGIES, INC.
By: /s/ MICHAEL MANSOURI By: /s/ BRAD CAYMAN
------------------------ ---------------------------------
Name: Michael Mansouri Name: Brad Cayman
---------------------- -------------------------------
Title: Chairman & CEO Title: Vice President
--------------------- ------------------------------
Date: Feb. 11, 2000 Date: Feb 15, 2000
---------------------- -------------------------------
4.
<PAGE> 1
EXHIBIT 10.12
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
- --------------------------------------------------------------------------------
ATTACHMENT TO NETWORK SERVICES AGREEMENT MSP-DIAL IMPLEMENTATION PROGRAM
- --------------------------------------------------------------------------------
In addition to the terms and conditions contained in the Network Services
Agreement, Customer and CompuServe further agrees:
Customer agrees to execute a Network Services Agreement with an initial Extended
Term Plan of three (3) year(s). CompuServe agrees to provide Customer with the
Implementation Program contained in this Attachment.
1. IMPLEMENTATION PROGRAM
To assist Customer in gaining experience with, and user acceptance of, the
Network Services provided hereunder, CompuServe agrees to provide an
Implementation Program during which:
1. The Implementation Program will commence on the first day
following provision by CompuServe to Customer of the network necessary for the
Customer's use of CompuServe's MSP-Dial service and conclude at the end of
twelve (12) full month(s) thereafter. The Three (3) year initial term shall
commence on the first day of the month following completion of the
Implementation Program. Customer shall have the option to terminate this
Attachment and the related Agreement, to be effective at the end of the
Implementation program, upon written notice to CompuServe at least ten (10) days
prior to the end of the Implementation Program.
2. During the Implementation Program, Customer shall be billed
[*] per hour for 300bps up to 57.kbps, where available, asynchronous dial
connections through a MSP-Dial network address; Customer shall also be billed
the following surcharges:
<TABLE>
<CAPTION>
FOR ACCESS THAT ORIGINATES FROM: SURCHARGE
PER HOUR
------------------------------- ---------
<S> <C>
CompuServe Points of presence located in Europe [*]
CompuServe Points of presence located in Mexico [*]
CompuServe Points of presence located in Australia &
New Zealand [*]
CompuServe Points of presence located in Japan [*]
1-800 Points of Presence located in the United States [*]
1-800 Points of Presence located in Canada [*]
1-800 Points of Presence located in Mexico [*]
1-800 Points of Presence located in the Caribbean [*]
</TABLE>
Network Services
Account No.
---------------------------
ACCEPTED FOR CUSTOMER: ACCEPTED FOR COMPUSERVE
INCORPORATED
Customer's Name: iPass Incorporated
---------------------
Signature: /s/ G. BRADFORD SOLSO Signature:
--------------------------- ----------------------------
Name: G. Bradford Solso Name:
-------------------------------- ---------------------------------
Title: VP & CFO Title:
------------------------------- --------------------------------
Date: 11/4/97 Date:
-------------------------------- ---------------------------------
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
1.
<PAGE> 2
- --------------------------------------------------------------------------------
COMPUSERVE NETWORK SERVICES AGREEMENT FOR MANAGED SERVICE PROVIDED (MSP)
- --------------------------------------------------------------------------------
CompuServe Incorporated ("CompuServe") will furnish on a shared resource, as
available basis and Customer will purchase CompuServe services under these terms
and conditions.
1. DESCRIPTION OF COMPUSERVE SERVICES
1.1 MSP-DIAL
MSP-Dial enables Customer validated remote users utilizing
CompuServe, Customer of user provided IP client software to dial into a
CompuServe PPP (Point to Point Protocol) Server and connect with the CompuServe
provisioned Internet Gateway. MSP-Dial includes 7 day by 24 hour customer
support for up to ten (10) identified Customer employees for questions about the
CompuServe-provided services; Customer warrants it will not provide the
CompuServe customer support phone number to any other customer employees or
users of the CompuServe-provided services.
2. TERM OF AGREEMENT
The term is three (3) years and commences on (i) the first day of the
month after Customer has been provided access to CompuServe services, or (ii)
completion of any Implementation Program. This Agreement automatically renews on
completion of the initial and subsequent terms at the then current rates and
conditions for consecutive three (3) year terms unless terminated upon written
notice to the other party at least one (1) month prior to the end of a term.
3. RATES
Customer shall be billed the rates associated with the Pricing Plan and
software options elected by Customer.
3.1 GUARANTEED MINIMUM NUMBER OF HOURS PER MONTH OPTIONS
Customer will be billed the Rate per Hour associated with the option
elected for all hours of traffic in a given moth according to the following
table:
<TABLE>
<CAPTION>
GUARANTEED MINIMUM NUMBER OF
HOURS PER MONTH RATE PER HOUR
---------------------------- -------------
<S> <C>
A. 0-500,000 [*]
B. 1,000,000 [*]
C. 1,500,000 [*]
D. 2,000,000 [*]
E. 2,500,000 [*]
</TABLE>
The Rate Per Hour applies to 300bps up to 57.Kbps, where available,
asynchronous dial connections through a MSP-Dial network address. The MSP-Dial
Rate per Hour includes all characters/packets that are transmitted and received
during sessions through a MSP-Dial network address. Connect time is charged per
second with a one minute per session.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
2.
<PAGE> 3
For example, if Customer elects the 1,000,000 hour minimum, Customer shall
be billed [*] per hour for all actual hours associated with the use of network
addresses allocated for Customer's network addresses. If the actual hours
associated with the use of host names allocated for Customer's network addresses
are less than Customer's Guaranteed Minimum Number of Hours per Month, Customer
will be billed for the Guaranteed Minimum Number of Hours per Month. Customer
shall also be billed the following surcharges:
<TABLE>
<CAPTION>
SURCHARGE
FOR ACCESS THAT ORIGINATES FROM: PER HOUR
------------------------------- --------
<S> <C>
CompuServe Points of presence located in Europe [*]
CompuServe Points of presence located in Mexico [*]
CompuServe Points of presence located in Australia &
New Zealand [*]
CompuServe Points of presence located in Japan [*]
1-800 Points of Presence located in the United States [*]
1-800 Points of Presence located in Canada [*]
1-800 Points of Presence located in Mexico [*]
1-800 Points of Presence located in the Caribbean [*]
</TABLE>
3.2 During the initial three (3) year term CompuServe will not increase
rates for any service unless (i) there is a court, legislative, FCC, or other
regulatory agency reclassification of CompuServe's status as an Enhanced Service
Provider, or other decision or action that results in an increase in
CompuServe's cost to provide services, or (ii) a supplier of CompuServe imposes
a rate increase; in such event, CompuServe reserves the right to pass through to
Customer such an increase and any associated increase in CompuServe's cost to
provide a service and CompuServe will provide Customer with as much notice as is
reasonable under the circumstances but not less than two (2) months prior
written notice. Within one (1) month of such notice, Customer may terminate this
Agreement by written notice. This termination will take effect on the date of
the proposed rate modification.
3.3 Customer shall pay the sum of (i) the charges associated with the
Rate per Hour (ii) charges associated with hourly surcharges, (iii) charges
associated with CompuServe-provided software, and (iv) any national, federal,
state, local or other area sales, use and other taxes however designated
(including but not limited to value added tax), imposed on Customer's usage
(exclusive of any taxes based upon CompuServe's income).
4. PAYMENT
Charges for services and supplies provided under this Agreement will
normally be invoiced following the end of each month. Terms of payment on all
charges are net, thirty (30) days at CompuServe's home office in U.S. dollars.
If payment is not received within five (5) business days following written
notice, CompuServe may suspend its performance under, or terminate, their
Agreement.
5. CUSTOMER RESPONSIBILITIES
5.1 Customer is responsible for Customer-provided links and equipment
(such as computers and modems) and telephone service required for access to
CompuServe's services. Customer is responsible for, and CompuServe does not
warrant, the compatibility of Customer-provided links, equipment, and software
used in conjunction with CompuServe-provided services. Customer understands that
CompuServe is unable to monitor or access the Customer-provided links and
equipment; Customer agrees that the remedy contained in Paragraph 7.4 of this
Agreement shall not apply to any problems associated with the Customer-provided
links, equipment or software. Customer warrants the CompuServe services will be
used solely to provide access to Customer's consumer ISP service which is
defined as ...[customized for each Customer].
5.2 Customer is responsible for the accuracy and adequacy of links,
computer equipment, programs and data it furnished or transmits, for use of the
output it obtains, for maintaining procedures external to the network system for
reconstruction of lost data or programs and for satisfying its requirements for
security and accuracy of system output. Reasonable precautions are taken to
prevent loss, alteration, or improper access to Customer's data access links
programs and data, but CompuServe does not guarantee accuracy or security.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
3.
<PAGE> 4
5.3 Customer acknowledges and agrees that CompuServe is not responsible
for, and does not control, the Internet or any information contained thereon.
Access to the Internet is provided by CompuServe solely on an "as is" basis.
CompuServe does not warrant, and does not warrant, and does not assume
responsibility for, any consequences suffered by any person as a result of
Internet access including, without limitation, those suffered by Customer and
end-users as a result of accessing such Internet Information and content, such
as the possibility of contracting computer viruses, accessing information with
offensive, inaccurate or inappropriate content, etc. CompuServe shall not be
responsible for any damages suffered by any person as a result of obtaining
Internet access. Customer acknowledges and agrees that all users (including
Customer and its end-users) must exercise their own due diligence before relying
on any such information available on the Internet, and must determine that they
have all necessary rights to copy, publish or otherwise distribution any such
information available on the Internet under copyright and other applicable laws.
Customer acknowledges and consents to the foregoing, and shall obtain the
acknowledgment and consent to the foregoing of all users to which it provides
access to the Internet. CompuServe and its subcontractors, and their licensers
and suppliers, shall be express third-party beneficiaries of this provision.
6. PERFORMANCE AND IMPROVEMENT
CompuServe may make or permit changes in the CompuServe services provided
under this Agreement. If CompuServe makes a change which has a material adverse
effect on Customer's operations, Customer may terminate this Agreement after
written notice which states with particularity the reason for termination,
provided CompuServe does not cure or remedy this condition within one (1) month.
All discoveries, improvements, adaptations, or developments relating to the
services provided by CompuServe under this Agreement are and shall remain the
exclusive property of CompuServe. If Customer can demonstrate that there has
been a material degradation in the services provided by CompuServe and that this
degradation has a material and adverse effect on Customer's operations, Customer
may, as its sole remedy, terminate this Agreement, three (3) months after
written notice is provided to CompuServe which states with particularity the
reason for termination, provided CompuServe does not cure this condition within
this three (3) month period.
7. WARRANTIES, DISCLAIMERS, LIMITATIONS ON LIABILITY
7.1 CompuServe will use reasonable care in providing services under this
Agreement. Except for maintenance and periods of shut-down caused by equipment,
system or power failure, or other causes beyond the reasonable control of
CompuServe, the systems will be operational twenty-four (24) hours a day.
7.2 [*]
7.3 Upon the discovery of facts which reasonably indicate CompuServe has
failed to perform its obligations under this Agreement, been neglect, or
breached a legal duty, customer shall: (i) promptly notify CompuServe of such
facts by telephone, and (ii) further notify CompuServe in writing within one (1)
month of such discovery. The unreasonable failure to give the foregoing notices
shall constitute an irrevocable waiver of all claims Customer has against
CompuServe with respect to such incident and be an absolute bar to the
institution of any actions based on such claims.
7.4 If notification is given to CompuServe as required by paragraph 7.3,
CompuServe will compensate Customer in an amount up to [*]. The remedy in this
paragraph is Customer's sole and exclusive remedy and recovery.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
4.
<PAGE> 5
8. THIRD PARTIES
8.1 This Agreement is not assignable by either party without the other
party's prior written consent which will not be unreasonably withheld: provided,
a change in control or transfer of substantially all corporate or division
assets shall not be considered an assignment under this provision. Customer may
allow third parties to use the services provided by CompuServe to enable such
third parties to access the data, information or services provided through or by
Customer. Customer warrants it has sufficient rights to allow third parties to
access the data, information, or services provided through or by Customer.
8.2 Except to the extent the claims result from (a) the indemnified
party's unauthorized or improper use of any confidential or proprietary
information or violation of other third party rights or 9b) the indemnified
party's negligence or breach of a legal or contractual duty: (i) CompuServe will
indemnify and hold harmless Customer and its affiliates from all claims made by
CompuServe's employees and suppliers, and (ii) Customer will indemnify and hold
harmless CompuServe from [*]. "Claims" means all claims, causes of action,
judgments, damages, costs or expenses, including without limitation, reasonable
attorneys' fees and court costs, related to this Agreement or the services
provided under it.
9. CONFIDENTIAL INFORMATION
9.1 "Confidential Information" is any information relating to the
business of the disclosing party: (i) of which the receiving party becomes aware
because of its performance of this Agreement; (ii) which is treated ad
confidential by the disclosing party. Neither party may disclose or use any of
the other party's Confidential Information, except to the extent necessary to
perform or to exercise rights under this Agreement, or with the consent of the
other party, which consent shall not be unreasonably withheld. Confidential
Information remains the sole property of the original owner and the party shall
exercise reasonable care to maintain its confidentiality. Each party shall use
reasonable care to prevent its employees and agents from violating this
restriction.
9.2 Confidential Information includes but is not limited to: (i)
information in any form, such as product developments, specifications,
protocols, formulas, methods, techniques, concepts, plans, ideas, programs and
documentation and business, marketing and financial information; (ii) the terms
of this Agreement and all proposals and discussions relating to it, whether oral
or reduced to writing; (iii) business information that is not generally
disclosed to the public; (iv) information which has been specifically designated
as being confidential or secret; (v) information that is deemed to be a trade
secret, or have similar status; and (vi) copies, in any medium, of any of the
above.
9.3 Confidential Information does not include information that (i) is or
becomes generally available to the public other than by unauthorized disclosure
by the receiving party; (ii) was known in the receiving party at the time of
disclosure from a source other than the disclosing party and this knowledge is
shown in the receiving party's written records; (iii) is or becomes known to the
receiving party, and the receiving party can show that it knows of no
restriction on disclosure binding on the source; or (iv) is independently
developed by the receiving party without using the disclosing party's
Confidential Information. If a party is compelled to disclosed Confidential
Information under the authority of a court or governmental agency, the compelled
party shall promptly notify the other party. The other party shall have the
opportunity to object to the compelled disclosure. To the extent that the other
party secures a legally enforceable protective or equivalent order and delivers
the order to the compelled party, the compelled party shall comply with the
order.
10. GENERAL
10.1 Notwithstanding any acknowledgment, any provision or condition in
any Customer purchase order, voucher or other memorandum, or CompuServe Invoice,
which is in any way inconsistent with, or adds to, the provisions hereof is null
and void.
10.2 No modifications of this Agreement or waiver of any of its terms
will be effective unless set forth in a written document signed by authorized
representatives of Customer and CompuServe.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
5.
<PAGE> 6
10.3 The services provided under this Agreement are those currently
available from CompuServe.
10.4 If any term of this Agreement is held to be invalid, the remainder
of the Agreement will remain in force. In such event, the parties shall use
their good faith efforts to replace the invalid provision with a valid provision
which tries to reach results comparable to those intended by the invalid
provision.
10.5 This Agreement shall be considered performed in Ohio and all
questions regarding the validity, intention of meaning of this Agreement or any
modifications of it will be construed and resolved under the laws and in the
courts of Ohio.
10.6 If a dispute arises which is not resolved by the personnel directly
involved, the parties shall each designate an executive officer who has no
direct operations responsibility for the subject matter of the dispute, and who
is authorized to investigate, negotiate, and settle the dispute. If the
disinterested officers are unable to settle the dispute within one (1) month (or
an extended period if they so agree), the matter shall proceed to mediation with
a mediator agreed upon by the parties from a list of mediators provided by the
Center for Public Resources. The parties agree to participate in the mediation
in good faith, its endeavor to complete it within two (2) months, and share
equally the mediator's fees and expenses. Either party may file suit or seek
temporary injunctive relief in court if in the judgment such action is necessary
to avoid expiration of an applicable statute of limitations, or necessary to
preserve the status quo or to prevent irreparable damage. The parties agree that
such court actin will otherwise be delayed or postponed until those Dispute
Resolution Procedures have been exhausted. Sections 7 and 8 of this Agreement
are not waived or modified by those Dispute Resolution Procedures.
10.7 This term service Agreement has been negotiated by the parties in
order to meet the specialized needs and requirements of such party, CompuServe
does not intend to act in the capacity of a common carrier in offering the
enhanced services provided under this negotiated Agreement.
10.8 Except for mutually agreed upon references, neither the Customer nor
CompuServe shall present or permit any advertising or promotional material which
makes references to the other's products or services, or trademark, logo or
similar symbol, without prior written approval by the other party. Approval
shall not be unreasonably withheld and must be communicated within a reasonable
amount of time.
10.9 The following paragraphs will survive the termination of this
Agreement, regardless of the reason for termination: 4, 5, 6, 7, 8, 9, and 10.
10.10 Each party shall conform to all applicable laws, government rules
and regulations related to its performance of this Agreement and use of the
services provided by CompuServe.
10.11 This Agreement, is the entire and only agreement between the parties
and supersedes all prior and contemporaneous oral or written proposals,
negotiations, conversations and other communications between the parties upon
which neither party is justified in relying. The terms and conditions of this
Agreement shall apply upon execution of this Agreement.
11. CUSTOMER ELECTIONS
11.1 Pricing Plan election (check one):
X No minimum hours per month
-----------
500,000 hours per month
-----------
1,000,000 hours per month
-----------
1,500,000 hours per month
-----------
2,000,000 hours per month
-----------
2,500,000 hours per month
-----------
6.
<PAGE> 7
11.2 IP Addresses will be provided by (check one):
Customer
-----------
x CompuServe; quantity to be provided:
-----------
to all user logins as well as servers we house there.
11.3 Names of Customer Contacts authorized to Call CompuServe Network
Client Support (list up to ten individual names; department names
are not acceptable):
1. Beth Winslow
------------------------------------------------
2. Grant Gunz
------------------------------------------------
3. Jannot Ross
------------------------------------------------
4. Jay Farhat
------------------------------------------------
5. Michael Fischer
------------------------------------------------
6. Mike Hart
------------------------------------------------
7. Francis Anton
------------------------------------------------
8. Tuan Bui
------------------------------------------------
9. Raghavan Seshadri
------------------------------------------------
10. Paul Chow
------------------------------------------------
ACCEPTED FOR CUSTOMER: ACCEPTED FOR COMPUSERVE
INCORPORATED
Customer's Name: /s/ GBS iPass Inc.
---------------------
Signature: /s/ G. BRADFORD SOLSO Signature:
--------------------------- ----------------------------
Name: G. Bradford Solso Name:
-------------------------------- ---------------------------------
Title: VP & CFO Title:
------------------------------- --------------------------------
Date: 11/4/97 Date:
-------------------------------- ---------------------------------
7.
<PAGE> 1
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
EXHIBIT 10.13
MANAGED DATA NETWORK SERVICES AGREEMENT
(Final: Dated September 17, 1996)
BETWEEN
SCITOR INTERNATIONAL TELECOMMUNICATIONS SERVICES, INC.
AND
I-PASS ALLIANCE, INC.
<PAGE> 2
This Agreement is entered into as of this 17th day of September, 1996 by
and between:
SCITOR INTERNATIONAL TELECOMMUNICATIONS SERVICES, INC., a company
incorporated under the laws of the State of Delaware, whose principal place of
business is located at 3100 Cumberland Circle, Suite 1200, Atlanta, Georgia
30339, hereinafter referred to as ("Scitor ITS"); and I-PASS ALLIANCE, INC., a
company incorporated under the laws of the State of California, whose principal
place of business is located at 555 Bryant Avenue, #248, Palo Alto, California
94301 hereinafter referred to as ("Customer").
RECITALS:
WHEREAS, Customer desires to obtain certain managed data network
services from Scitor ITS in order to enable data communications from, to and
between certain of Customer's offices worldwide;
WHEREAS, the Parties desire to specify the terms and conditions under
which Scitor ITS will provide the Service to Customer;
NOW, THEREFORE, in consideration of the premises and mutual undertakings
hereinafter set forth, the Parties, intending to be legally bound, hereby agree
as follows:
1. DEFINITIONS
1.1 In this Agreement, including the Attachments and Schedules which are
by this reference incorporated herein, the following words and expressions shall
have the following meanings:
1.1.1 "ASSOCIATED COMPANY" shall mean any company controlling,
controlled by or under common control of either of the Parties;
1.1.2 "CCITT" shall mean the International Telegraph and
Telephone Consultative Committee;
1.1.3 "COMMISSIONING TESTS" shall mean the commissioning tests
and procedures to be carried out by Scitor ITS in order to commission the
services as specified in Attachment 4;
1.1.4 "CUSTOMER EQUIPMENT" shall mean X.25 pads or LANAS routers
used for access to Scitor ITS Network and to utilize the Service;
1.1.5 "DATE OF CONNECTION" shall mean the date of the physical
connection and commissioning of the Service at each of the Locations;
1.1.6 "DOLLARS" or "$" shall mean United States Dollars;
1.1.7 "DTE" shall mean Data Terminating Equipment;
1.1.8 "EFFECTIVE DATE" shall mean the date first above written;
Page 1
<PAGE> 3
1.1.9 "EQUIPMENT" shall mean the communications equipment,
cables and connectors which may be supplied by Scitor ITS to Customer under this
Agreement;
1.1.10 "CUSTOMER FACILITIES" shall mean all such equipment and
communications lines, including any public data networks or Customer Equipment
required by Customer to access the Network (other than Tail Circuits, Equipment
and Software which Scitor ITS supplies to Customer pursuant to Clause 5.2)
magnetic media, programs, software and other facilities, including the provision
of personnel, required by Customer for its use of the Service;
1.1.11 "FORCE MAJEURE" shall mean an event the result of which
causes a Party's failure or delay in performance due to circumstances beyond the
that Party's reasonable control including, but without limitation to the
foregoing, labor disputes, strikes, lock-outs, shortages of or liability to
obtain labor, energy components, raw materials or supplies, war or act of war,
riot, insurrection, epidemic, act of God or governmental action not the fault of
the non-performing Party;
1.1.12 "FRAME RELAY" shall mean a high speed switched data
service accessing the Network via a permanent leased digital Tail Circuit
supporting the transfer of bi-directional Frame Relay frames between terminating
equipment at Locations and Scitor ITS' Frame Relay service port on the Network.
1.1.13 "INITIAL TERM" shall mean forty (40) months from the
Effective Date of this Agreement;
1.1.14 "LOCATIONS" shall mean Customer's locations to be
provided with the Service as listed in Attachment 2;
1.1.15 "NETWORK" shall mean Scitor ITS's communications
processors, related equipment, and circuits used by Scitor ITS for the provision
of the Service, but excluding Tail Circuits to Locations, public data networks
and any terminal equipment including the Equipment sited at Locations;
1.1.16 "NODE" shall mean a node of the Scitor ITS Network to
which a Tail Circuit is to be connected for the purposes of rendering the
Service to Customer (dedicated leased line connections only) such Nodes being
deployed at such times and places as determined by Scitor ITS;
1.1.17 "PARTIES" shall mean Scitor ITS and Customer; "Party"
shall mean either Scitor ITS or Customer as the context requires;
1.1.18 "PTT" shall mean a governmental or non-governmental
entity or authority which is empowered to own or lease and operate
telecommunications circuits or other capacity and to lease said circuits or
capacity to parties such as Scitor ITS;
1.1.19 "PUBLIC X.28" shall mean Scitor ITS' shared public rotary
X.28 dial up service.
Page 2
<PAGE> 4
1.1.20 "SERVICE" shall mean Frame Relay, X.25, X.28, LAN Access
and other data communications services and all related and ancillary services
thereto, or any of same, including the provision of Equipment and Software, all
as more fully described in Attachment 1;
1.1.21 "SITA" shall mean Societe Internationale de
Telecommunications Aeronautiques;
1.1.22 "SOFTWARE" shall mean the software programs and each and
every component thereof, as amended from time to time, including all
developments, versions or releases thereof whether existing now or becoming
available in the future, and all related documentation, which may be supplied by
Scitor ITS in connection with the provision of the Service, whether integral to
the Equipment or otherwise;
1.1.23 "SUB-CONTRACTOR" shall mean an Associated Company of
Scitor ITS or otherwise a third party whose identity has been notified to
Customer;
1.1.24 "TAIL CIRCUIT" shall mean a telecommunications circuit or
other capacity leased from the relevant telecommunications authorities (PTTs)
and which permits the connection of a Location to the nearest Scitor ITS Network
node;
1.1.25 "X.25" shall mean a synchronous protocol utilized to
effect managed data network services.
2. SCOPE AND PURPOSE OF AGREEMENT
This Agreement, including the Attachments, and Schedules, governs the
terms and conditions upon which Scitor ITS shall render the Service to Customer.
This Agreement is for the benefit of Customer only and in no event shall
Customer be entitled to resell the Service to any third party. Scitor ITS
reserves the right to refuse any request for Service at any Location or country
or to immediately suspend or terminate any Service if Scitor ITS has reasonable
grounds for suspecting that such request for, or provision of Service is not in
accordance with this Clause 2. In no event shall Customer be authorized to
connect any other communications network to the Network, with the exception of
the Customer Equipment, whether directly or indirectly or whether via Equipment
or any other terminal equipment not supplied by Scitor ITS. Breach of this
Clause 2 by Customer shall be considered a material breach of this Agreement.
3. TERM AND TERMINATION
3.1 This Agreement shall become effective on the Effective Date and,
except as provided under Clauses 3.2 or 3.3 below, shall continue in full force
and effect for the Initial Term. Thereafter, this Agreement shall be
automatically renewed for successive periods of 12 months unless either Scitor
ITS or Customer gives to the other Party written notice of its intention to
terminate this Agreement at least 60 days prior to the end of the Initial Term
or any renewal thereof.
3.2 Either Party may terminate this Agreement by notice in writing to
the other Party forthwith in any of the following events:
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3.2.1 if the other Party is guilty of any material breach,
non-observance or non-performance of its obligations hereunder or any of them
and does not remedy the same (if it is capable of remedy) within 14 days of
written notice of such failure or breach being given by the non-defaulting
Party;
3.2.2 if an order is made or an effective resolution is passed
for the dissolution or winding up of the other Party except for the purposes of
an amalgamation, merger or reconstruction;
3.2.3 if an encumbrancer takes possession or a receiver is
appointed over the whole or any part of the undertaking or assets of the other
Party;
3.2.4 if the other Party becomes insolvent or makes any special
arrangements or any special assignment for the benefit of its creditors, or is
the subject of a voluntary or involuntary filing under the bankruptcy laws of
any jurisdiction.
3.3 On termination of this Agreement for whatever reason each Party will
return to the other forthwith any and all property of whatever kind and nature
provided under this Agreement and belonging to the other.
3.4 Termination of this Agreement for any cause shall not affect any
rights or obligations of the Parties in relation to anything done prior to such
termination and the provisions of this Agreement shall continue to bind the
Parties insofar and so long as may be necessary to give effect to such rights
and obligations.
4. PROVISION OF SERVICE
4.1 Customer shall negotiate and conclude contracts with Customer
Equipment suppliers wherein such contracts include the provision of the
Services. Customer shall be solely responsible for all risks and expenses
incurred in connection with its activities under this Agreement and for itself
with Customer Equipment suppliers for the purpose of provisioning the Services
and act in all respects on its own account, including, but not limited to,
technical support, project management and help desk services. Customer shall
procure under Customer Equipment suppliers contracts that all Customer Equipment
suppliers will comply with all obligations of Customer under this Agreement.
4.2 Scitor ITS shall provide and Customer shall obtain from Scitor ITS,
the Service specified in Attachment 1, subject to payment of the charges
specified in Attachment 2.
4.3 Scitor ITS reserves the right to control, direct and establish
procedures for the use of the Service and Customer agrees to follow the
reasonable instructions and procedures of Scitor ITS with respect to the use of
the Service. Scitor ITS also reserves the right to make operational changes to
the Service, including Customer identification procedures, types of terminal
equipment permitted to access the Service, system programming languages,
administrative and operational algorithms, apparatus comprised in any network
used to deliver the Service, and designation of particular addresses, provided
that in the exercise of its rights
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under this Clause 4.2, Scitor ITS shall not materially adversely affect the
Service provided to Customer nor cause Customer to incur increased charges.
4.4 Recognizing the rapidly changing telecommunications environment and
the evolving area of telecommunications law, both Parties shall actively monitor
and ensure that its operations, including the connection of any apparatus,
Equipment or Customer Equipment to any network used to deliver the Service, are
in full compliance at all times with the applicable telecommunications, data
protection, or other laws, regulations, and licenses (including, but not limited
to, the requirements and limitations associated with the provision of voice
service over frame relay) in each jurisdiction in which Customer uses the
Service or Scitor ITS provides the Service. Customer will obtain any necessary
regulatory approvals and licenses, and upon reasonable request from Scitor ITS,
Customer will provide evidence of said regulatory approvals and licenses to
Scitor ITS.
4.5 Any terminal, Customer Equipment or other computer equipment used to
gain access to the Service must be approved by Scitor ITS prior to its
connection to the Network. Scitor ITS reserves the right to immediately
disconnect (or require the disconnection of) any such equipment in breach of
this provision.
4.6 Customer shall nominate a representative ("Network Project
Manager") and a deputy on either of whose authority Scitor ITS may rely in its
relationship with Customer.
4.7 Scitor ITS shall put in place, and thereafter maintain for the term
of this Agreement, reasonable security to protect Customer's computer stored
data transmitted over the Network from unauthorized access and disclosure other
than as permitted by the terms of this Agreement or to anybody having statutory
authority to require Scitor ITS to make disclosures.
4.8 Customer shall be responsible for obtaining and maintaining the
Customer Facilities. Neither Scitor ITS nor its agents or Sub-Contractors shall
have any responsibility for or liability with respect to the Customer
Facilities, including, but not limited to, the use, operation or performance of
such Customer Facilities.
4.9 It is understood that the provision of adequate comprehensive
liability insurance to protect Scitor ITS/SITA or Associated Companies of Scitor
ITS from all forms of property damage, bodily injury and death, in all Locations
where Customer Equipment is co-located with Scitor ITS/SITA or Associated
Companies of Scitor ITS shall be provided by Customer. Said insurance shall be
evidenced by Customer providing to Scitor ITS a certificate of insurance naming
Scitor ITS/SITA or Associated Companies of Scitor ITS as additional insured with
a minimum of thirty (30) days notice of cancellation.
5. SUPPORT SERVICES
5.1 Scitor ITS shall provide for the benefit of Customer the help desk
facilities at certain locations as notified by Scitor ITS, in order that
Customer may obtain technical advice and guidance on the operation and use of
the Service. Customer understands that the location of the help desk facilities
is subject to reasonable change at any time. These help desk facilities will be
available 24 hours a day, 7 days a week, to answer all service related queries
to Customer
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designated personnel. Scitor ITS shall use its reasonable endeavors to respond
to Customer promptly on any query which is Service related.
5.2 Scitor ITS shall provide Tail Circuit management Service for all
Tail Circuits requested by Customer. Tail Circuit management services comprise:
5.2.1 ordering (where legally able to do so) and managing of the
connection of Tail Circuits, modems and other communications equipment from the
relevant PTTs or other third party vendors as applicable;
5.2.2 testing and acceptance of Tail Circuits, modems and other
communications equipment;
5.2.3 Tail Circuit fault reporting and coordination of
restoration upon Scitor ITS becoming aware of a fault;
5.2.4 payment to PTTs and other third party vendors in local
currency on Customer's behalf, where applicable (but this service does not
affect Customer's liability with respect to such Tail Circuits, modems or other
communications equipment and all sums paid by Scitor ITS to PTTs or other third
party vendors in respect thereof shall be reimbursed by Customer as more fully
described in Attachment 2).
5.3 It is acknowledged by Customer that in providing the Service under
this Agreement, Scitor ITS will be carrying out various project management tasks
as agreed by Customer. Customer hereby agrees to pay Scitor ITS for all project
management agreed in advance by Customer, in accordance with the charges
specified in Attachment 2. Project Management shall include, without limitation,
creation and agreement of critical path schedules, liaison with Customer's
Network Project Manager, implementation and configuration of all Network
connections and overall management of Customer's account.
5.4 Scitor ITS shall put in place as soon as possible following the
Effective Date of this Agreement, appropriate escalation procedures to
facilitate the prompt and orderly resolution of any problems.
6. EQUIPMENT
6.1 Scitor ITS shall connect the Equipment at the Locations (if
requested by Customer) on dates to be agreed by the Parties. Scitor ITS shall
provide reasonable notification of the date of connection and shall connect at
times to be agreed by the Parties. Should connection require the removal or
disconnection of any existing equipment of Customer, Customer shall permit, and
obtain all necessary consents for, such removal or disconnection and shall give
Scitor ITS all necessary assistance to enable such work to be carried out.
6.2 On the date of connection of the Equipment, Scitor ITS shall
commission the Equipment, which on successful commissioning shall be turned over
to the Customer for Acceptance Testing. For the purpose of this Clause 6.2,
"successful commissioning" shall mean that Scitor ITS shall have checked,
powered up, and then carried out manufacturer's initialization tests on the
Equipment as confirmed by Customer in writing by the Customer's or the
Associated Company's Network Project Manager. Customer shall have fifteen (15)
days following
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successful commissioning to test the Equipment to ensure that the Equipment is
functioning according to the specifications as set forth in Exhibit 1 to
Attachment 4 and is installed correctly ("Test Period"). Customer shall inform
Scitor ITS in writing of any non-conformance during this period and Scitor ITS
upon notification shall promptly correct such non-conformance. If Scitor ITS is
unable to correct such non-conformance within thirty (30) days then the Customer
may elect to cancel the Service at the affected Location without further
obligation to Scitor ITS, If the Customer fails to provide Scitor ITS with
notice within the Test Period, the Equipment shall be deemed accepted by the
Customer. The date of acceptance shall be either the date Customer provide
written notice of acceptance or fifteen (15) days after successful
commissioning, whichever is earlier.
6.3 The rental period shall commence on the date of acceptance of the
Service pursuant to Clause 12 and shall thereafter continue in accordance with
the term of this Agreement.
6.4 The rental and any other charges shall be as specified in Attachment
2.
6.5 The Equipment shall at all times remain the sole and exclusive
property of Scitor ITS or its Sub- Contractors and Customer shall have no rights
or interest in the Equipment except for quiet possession and the right to use
the Equipment under the terms and conditions of this Agreement.
6.6 Customer shall have the following additional obligations with
respect to the Equipment:
6.6.1 not to sell, assign, sub-let, pledge or part with
possession or control of or otherwise deal with the Equipment or any interest
therein;
6.6.2 not to change, remove or obscure any labels, plates,
insignia, lettering or other markings which are on the Equipment at the time of
connection thereof or which may thereafter be placed on the Equipment by Scitor
ITS or by any person authorized by Scitor ITS;
6.6.3 to keep the Equipment free from distress, execution or any
other legal process;
6.6.4 not to move the Equipment from the Location to which it
was delivered and connected without Scitor ITS's prior written consent;
6.6.5 not to use the Equipment or permit the same to be used
contrary to any law or any regulation for the time being in force.
6.7 Customer shall have full responsibility for the upkeep of the
Equipment. For the purpose of this Clause 6.7, "responsibility for upkeep" shall
mean that Customer shall:
6.7.1 ensure that proper environmental conditions as recommended
by the manufacturers are maintained for the Equipment and that the exterior
surfaces are kept clean and in good condition;
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6.7.2 not make any modifications to the Equipment;
6.7.3 not use in conjunction with the Equipment any accessory,
attachment or additional equipment other than that which has been supplied by or
approved in writing by Scitor ITS.
6.8 Upon termination or expiry of this Agreement, Customer shall
surrender possession of the Equipment in good order, repair and condition, to
Scitor ITS, fair wear and tear excepted.
6.9 Scitor ITS shall ensure that the Equipment is at the time of
commissioning, and remains during the term of this Agreement, in good working
order. If a Service fault occurs which has been caused by a failure in the
Equipment, Scitor ITS shall restore or repair the Service as soon as practicably
possible to the affected Location following such notification. Scitor ITS
further agrees that a Scitor ITS Sub-Contractor will, if necessary as determined
by Scitor ITS, arrive at the affected Location and commence any remedial
activities within 4 working hours of notification, provided the notification is
received, and the call-out can be made during the normal business day of the
Scitor ITS Sub-Contractor nearest to the affected Location, and provided, also
that the affected Location is within a 45 mile radius of said center ("Normal
Service"). Remedial service on Equipment other than Normal Service shall be
carried out by Scitor ITS through its Sub-Contractors as soon as is practicably
possible, taking into account availability of service personnel, the time and
date of Customer's notification and the country concerned.
6.10 Scitor ITS shall not be responsible for Service faults, nor shall
Scitor ITS be obliged to comply with its obligations under Clause 6.9, if such
faults occur as a result of: (a) damage to the Equipment during transport
activity or connection carried out by Customer or any third party other than as
authorized by Scitor ITS; (b) interventions other than normal interventions
carried out by non Scitor ITS personnel; (c) modifications, to the Equipment
which have not been approved by the Equipment manufacturer or carried out by
personnel unapproved by Scitor ITS; (d) improper treatment to the Equipment,
failure to meet the Equipment manufacturer's specifications, or environmental
conditions; or (e) accident or negligence on the part of Customer or any Force
Majeure event. Any site visits or repairs made necessary by the events specified
in this Clause 6.10 shall be subject to prior agreement by Scitor ITS and may
cause Customer to incur increased charges for the Service at the affected
Location, such charges to be commensurate with the cost to Scitor ITS of
restoring or repairing the Service.
7. SOFTWARE
Customer is hereby granted non-exclusive and non-transferable licenses
to use Software strictly in performing this Agreement. The Software and any
intellectual property rights of whatever nature in the Software are and shall
remain vested in Scitor ITS or an Associated Company of Scitor ITS and nothing
contained in this Agreement shall convey any ownership interest in the Software
to Customer. Customer acknowledges that the provision of Software is made by
Scitor ITS strictly for use in conjunction with the Service and Customer agrees
not to produce, copy, alter, modify, or add to the Software or any part thereof,
nor to attempt or to
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allow a third party to attempt to reverse engineer, translate or convert the
Software from machine readable to human readable form, except as permitted by
applicable law.
8. INTELLECTUAL PROPERTY RIGHTS AND CONFIDENTIALITY
8.1 It is understood and agreed by Customer that all intellectual
property rights in the computer programs utilized by Scitor ITS in relation to
the Service, and the Network are either licensed to or the property of Scitor
ITS and nothing contained in this Agreement shall be deemed to convey title or
ownership interest therein to Customer.
8.2 Subject to this Clause 8.2, Scitor ITS warrants that the Service
will not infringe third party intellectual property rights in any country where
the Service are provided to Customer. If Scitor ITS breaches this warranty it
will defend Customer against any claim in respect of any infringement or alleged
infringement and will pay resulting costs and damages finally awarded by a
court, provided that Customer: (a) promptly notifies Scitor ITS in writing of
the claim and; (b) gives Scitor ITS sole control of the defense and all related
settlement negotiations. Scitor ITS will either procure the right for Customer
to continue using the Service (including the part of the Service that has
infringed) or offer alternative Service so that they become non-infringing, at
no cost to Customer. Scitor ITS will have no liability for any claim based upon
the combination, operation or use of the Service with equipment, data or
software not supplied by Scitor ITS if the cause of the infringement cannot be
clearly identified. Notwithstanding anything else contained in this Clause 8.2,
in no event shall Scitor ITS's liability to Customer in respect of Equipment or
software not proprietary to Scitor ITS or an Associated Company of Scitor ITS
exceed any intellectual property infringement warranties provided to Scitor ITS
or an Associated Company of Scitor ITS by third party equipment and software
suppliers.
8.3 Customer and Scitor ITS acknowledge that they will receive
confidential information and trade secrets ("Confidential Information") from
each other in connection with this Agreement. Confidential Information shall be
deemed to include all the information each Party receives from the other Party,
except anything designated as not confidential. Customer and Scitor ITS agree to
maintain the secrecy of the Confidential Information and agree neither to use it
(except for the purposes of performing hereunder) nor to disclose it to anyone
outside Customer or Scitor ITS or to anyone within Customer and Scitor ITS who
does not have a need to know it in order to perform under this Agreement.
Confidential Information shall not include any information which is publicly
available at the time of the disclosure or subsequently becomes publicly
available through no fault of Customer or Scitor ITS or is rightfully acquired
from a third party who is not in breach of an agreement to keep such information
confidential.
9. CHARGES AND PAYMENT
9.1 All charges shall be invoiced by Scitor ITS to Customer in Dollars,
monthly in advance unless otherwise provided in Attachment 2, and shall be
payable, in Dollars, without deduction or set- off, within 30 days of receipt of
invoice by Customer. All other charges shall be invoiced as incurred or monthly,
in arrears, in Dollars and shall be payable, in Dollars, without deduction or
set-off, within 30 days of receipt of invoice by Customer.
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9.2 All prices and charges stated are exclusive of value added tax,
sales tax, excise tax, gross receipts tax and any similar tax which may be
applicable thereto and Customer agrees to pay all such applicable taxes.
9.3 Scitor ITS reserves the right to make a reasonable charge for any
work done by Scitor ITS which is attributable to Customer's failure to perform
any of its obligations under this Agreement, provided that such work is
necessary in the reasonable discretion of Scitor ITS and that wherever feasible,
Scitor ITS shall have notified Customer's Network Project Manager in advance.
9.4 Reasonable charges for travel and subsistence (when not specifically
and expressly included in the Service) are separately payable by Customer
provided and to the extent that they have been agreed to in advance by the
Parties.
9.5 Failure to pay by Customer according to the terms of this Agreement
shall entitle Scitor ITS, without prejudice to its other rights and remedies
under this Agreement to:
9.5.1 charge interest on a daily basis from the original due
date at the rate of 4 percentage points above the Chase Manhattan Bank's annual
Prime Rate in force from time to time; and/or
9.5.2 suspend the Service, having given 14 days written notice
of its intention to do so, and Customer having failed to remedy its payment
default during that time.
9.6 There will be special pricing that applies to the Services up until
December 31, 1996. After that date the full rate pricing will be charged, all as
more fully described in the Schedule to Attachment 2.
10. EXCLUSIONS AND LIMITATIONS OF LIABILITY
10.1 Neither Party will be liable for delay in performing obligations or
for any failure to perform obligations if the delay results from circumstances
beyond the reasonable control of either Party.
10.2 EXCEPT AS EXPRESSLY CONTAINED IN THIS AGREEMENT, SCITOR ITS MAKES
NO WARRANTIES AND HEREBY DISCLAIMS ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT
TO THE SERVICE OR ANY EQUIPMENT OR SOFTWARE PROVIDED UNDER OR IN RELATION TO THE
AGREEMENT.
10.3 NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, NEITHER
PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY INCIDENTAL, SPECIAL,
CONSEQUENTIAL OR PUNITIVE DAMAGES HOWSOEVER ARISING INCLUDING, BUT NOT LIMITED
TO, ANY DAMAGES FOR LOST TIME, INCOME, REVENUE, CLIENTS GOODWILL, PROFITS OR
OTHER SIMILAR ITEMS, OR
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ANY BUSINESS INTERRUPTION OF ANY KIND EVEN IF THE OTHER PARTY HAS BEEN INFORMED
OF THE POSSIBILITY OF SUCH DAMAGES IN ADVANCE.
10.4 In the event that data furnished by Customer, whether transmitted
via the Network or otherwise, is lost, destroyed or damaged due to the
negligence of Scitor ITS, its agents or employees, Customer's sole remedy shall
be the repair or replacement by Scitor ITS of such lost, destroyed or damaged
data, provided however that such repair or restoration can reasonably be
performed by Scitor ITS and provided, further, that Customer furnishes Scitor
ITS with all source data, in machine readable form, necessary for such repair or
restoration.
10.5 Subject to Clauses 10.3 and 10.4, and without prejudice to
Customer's obligation to pay any charges hereunder for Service rendered, the
Parties' maximum liability to each other under this Agreement is limited in
respect of each event or series of connected events as follows:
<TABLE>
<S> <C>
$1,000,000 in respect of physical damage to or loss of tangible property;
$100,000 in respect of all other events other than intentional acts or acts of
negligence by a Party, its employees or agents, to the extent
that such acts cause death of or injury to persons.
</TABLE>
10.6 The Parties' sole obligations and liabilities are as stated in this
Agreement and all other representations, conditions, warranties and terms
express or implied whether by statute, law or otherwise are hereby excluded to
the full extent permitted by law.
11. INDEMNITY
Customer hereby agrees to indemnify and hold Scitor ITS harmless, from
and against any and all claims, liabilities, losses, damages, costs, expenses
(including reasonable legal fees and other costs of litigation or arbitration on
an indemnity basis) [*]. This Clause 11 shall survive any termination or
expiration of this Agreement.
12. COMMISSIONING AND ACCEPTANCE OF SERVICE
12.1 Scitor ITS shall commission the Service at the Locations carrying
out the Commissioning Tests and procedures specified in Attachment 4.
12.2 Acceptance of the Service at a Location by Customer shall be on the
date that Scitor ITS has successfully completed said Commissioning Tests or, in
the case of X.28 dial-up shared public rotary service, on the date Scitor ITS
issues a network user identifier ("NUI") to Customer.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
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13. CHANGE CONTROL PROCEDURES
All changes to the Service including, without limit to the generality of
the foregoing, connection upgrades and downgrades, reconfigurations and new
Service shall be as mutually agreed by the Parties and shall be subject to the
following change control procedures:
13.1 Customer shall submit to Scitor ITS a written request for change
which alters, amends, enhances, adds to or deletes from the Service to be
provided by Scitor ITS under this Agreement (hereinafter referred to as an
"RFC");
13.2 Scitor ITS shall evaluate each such RFC and shall within fourteen
(14) days following Scitor ITS's receipt of the RFC submit a written response
including Scitor ITS's ability to provide any varied or new Service, and the
cost impact upon Customer in doing so;
13.3 upon receipt of Scitor ITS's response, Customer shall notify Scitor
ITS whether it wishes to proceed on the basis of the terms and conditions set
forth in Scitor ITS's response;
13.4 upon receipt of said notification from Customer that they wish to
proceed, Scitor ITS shall within sixty (60) days of the original written request
from Customer, commence performance in accordance therewith;
13.5 for the purposes of this Agreement, each RFC duly accepted by
Scitor ITS and Customer shall constitute a supplement to this Agreement and
shall thus be automatically incorporated herein.
14. APPLICABLE LAW AND ARBITRATION
14.1 This Agreement and all matters regarding the interpretation and /
or enforcement hereof, shall be governed exclusively by the law of the State of
Georgia, except in so far as the federal law of the United States of America may
control any aspect of this Agreement in which case federal law shall govern such
aspect.
14.2 All disputes arising in connection with this Agreement shall be
settled exclusively by arbitration before a single arbitrator in Washington, D.
C. in accordance with the Commercial Arbitration Rules of the American
Arbitration Association. Each Party irrevocably consents to personal
jurisdiction and to ex parte action should any Party refuse to participate in
such proceedings. The arbitrator's award shall be final and binding on all
Parties and judgment on the award may be entered and the award enforced in any
court having jurisdiction thereof.
15. GENERAL
15.1 NOTICES: All notices under this Agreement shall be in writing
addressed to the Parties at their respective addresses stated on page 1 hereof,
or any subsequent address notified to the other Party following the procedures
set forth in this Clause 15.1. If sent by international courier, notices shall
be deemed to have been given 3 days after the date of delivery by the Party
giving notice the notice to the courier. Notices hereunder may also be sent by
facsimile to addresses and/or numbers notified for the purpose pursuant to the
procedures set forth in this Clause 15.1, provided that the sending Party
obtains confirmation of the receipt of
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such notices from the recipient. If so sent, such notices shall be deemed to
have been given on the first business day (in the country of receipt) after the
date of transmission.
15.2 ASSIGNMENT: Neither Party shall assign or otherwise dispose of this
Agreement or any part hereof or any benefit hereunder without the prior consent
in writing of the other Party, provided that:
15.2.1 Scitor ITS shall be entitled to assign or otherwise
dispose of this Agreement or any part hereof to an Associated Company of Scitor
ITS; and
15.2.2 Customer shall be entitled to assign or otherwise dispose
of this Agreement, or any part hereof to an Associated Company of Customer,
having received Scitor ITS's written consent, such consent not to be
unreasonably withheld or delayed.
15.3 NO WAIVERS: No failure or delay of either Party in exercising any
right, power, or privilege hereunder (and no course of dealing between the
Parties) shall operate as a waiver of any such right, power or privilege. No
waiver of any default on any one occasion shall constitute a waiver of any
subsequent default. No single or partial exercise of any such right, power or
privilege shall preclude the further or full exercise thereof.
15.4 NO THIRD PARTY BENEFICIARIES, AGENCY OR PARTNERSHIP: The provisions
of this Agreement are solely for the benefit of the Parties. No other parties,
including Customer Associated Companies , invitees, members of the general
public and other third parties are intended to have nor shall have any rights
whatsoever under this Agreement, whether for injury, loss or damage to persons
or property, or for economic loss, damage or injury otherwise. This Agreement is
not intended to create a joint venture or partnership between the Parties and
neither Party is authorized to act as the agent of the other.
15.5 INVALIDITY: If any term, provision, or clause of this Agreement or
any portion of such term, provision or clause is held invalid or unenforceable,
the remainder of this Agreement will not be affected thereby and each remaining
term, provision or clause or portion thereof will be valid and enforceable to
the full extent permitted by law.
15.6 FURTHER DOCUMENTS: Each Party agrees to execute such additional
documents as may be necessary or appropriate to accomplish the purposes this
Agreement.
15.7 SUB-CONTRACTORS: Scitor ITS shall be entitled to subcontract any of
its obligations under this Agreement to Sub-Contractors but Scitor ITS shall in
all events be fully liable to Customer for the performance (or lack of) of its
Sub-Contractors under this Agreement.
15.8 ENTIRE AGREEMENT: This Agreement constitutes the entire agreement
relating to the Service and supersedes all previous oral or written
communications, proposals and agreements in respect thereof. This Agreement may
not be modified, except by supplements duly executed by the Parties.
15.9 INTERPRETATIONS: In this Agreement unless otherwise stated (a) the
headings used in this Agreement are included for convenience only and are not to
be used in construing or
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interpreting this Agreement; (b) any reference to the plural shall include the
singular and any reference to the singular shall include the plural; and (c) any
reference to an attachment, clause or to a schedule shall be an attachment,
clause or a schedule of this Agreement.
IN WITNESS WHEREOF, Scitor ITS and Customer have duly executed this
Agreement as of the day and year first above written.
SCITOR ITS CUSTOMER
By: /s/ William Bongert By: /s/ Christopher Moore
-------------------------------- -----------------------------------
Name: William Bongert Name: Chris Moore
------------------------------ ---------------------------------
Title: Vice President & GM Title: President
----------------------------- --------------------------------
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ATTACHMENT 1 - DESCRIPTION OF SERVICE
The Service provided by Scitor ITS under this Agreement shall be as
described in this Attachment. Changes to the Service shall be mutually agreed by
the Parties (and in accordance with the procedures set forth in Clause 13) and
shall be incorporated herein by duly executed supplements.
1. OVERVIEW.
Scitor ITS shall provide Customer with an end to end managed data
network service, providing a complete end to end solution for the
interconnection of Customer's Local Area Network ("LAN") in the
Locations, and including connection to the Network (X.25 or Frame Relay)
to the SITA Mega Transport Network (MTN), provision and support of
routers, end to end Network management to include alarm monitoring,
configuration, problem diagnosis, and consolidated support of all
Network components. In order to maintain security of the Locations, each
of the routers provided will be configured with an access list. Customer
shall be provided with a VPN that shall be accomplished by
administration of the virtual private circuits as defined in the Frame
Relay service to prevent access to and from any site not specifically
authorized by the Customer. Access lists in the Customer's site routers
can be used to provide additional security as Customer deems necessary.
2. SPECIFIC CONNECTIONS
Scitor shall provide the specific connections at the Customer's request
and line speeds to the Network all as more fully described in the
schedules to Attachment 2 at the Locations listed in the schedule to
Attachment 3, and also the provision of routers, modems, and cables
(from the routers to the modems).
3. SOFTWARE
The Software under this agreement shall consist of software and firmware
integral to the Equipment.
4. LAN TO LAN ACCESS
LAN to LAN Access comprises the delivery, configuration, connection and
ongoing support of all routers, modems and cables to ensure LAN to LAN
connectivity between the Locations. As part of this service Scitor ITS
will configure the router network to provide optimum performance across
the Network. Each LAN protocol to be carded across the network will be,
in each case, tuned to ensure that only traffic for the wide area
network is passed from the LAN.
Attachment 1, Page 1
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ATTACHMENT 2 - CHARGES
Scitor ITS shall provide Customer with the Service in the Locations and
in accordance with the charges all as set forth in the schedule to this
Attachment ("Schedule"). Scitor shall commence billing of fixed port and CIR
charges on the date of commissioning of the Service at any Location and such
charges will then be invoiced monthly in advance until the date of termination
or expiration of this Agreement; traffic charges shall be invoiced monthly in
arrears; connection and set up charges will be added to the first months port
charge, and NUI administration charges shall be invoiced monthly in arrears.
Customer understands that the X.28 connections are Scitor ITS' asynchronous
public shared rotary dial-up Service.
1. PORT AND CIR CHARGES
The port and CIR charges applicable to the Locations shall be as
specified in the Schedule. All port and CIR charges are fixed for the
Initial Term. Scitor shall commence billing of fixed port charges on the
date of commissioning of the Service at any Location and such charges
will then be invoiced monthly in advance until the date of termination
or expiration of this Agreement.
2. CONNECTION AND DISCONNECTION CHARGES
The charges applicable for connections shall be as specified in the
Schedule and for disconnections shall be [*] per disconnected Location.
All such charges are one time charges payable in the case of connections
on the date of commissioning of the Service at a Location; in the case
of disconnections, such charges are payable on the date of disconnection
of the Location from the Network.
3. PROJECT MANAGEMENT CHARGES
Project Management charges applicable to this Agreement shall be as
specified in the "Schedule. All Project Management charges are one time
charges payable on the date of commissioning of the Service at a
Location.
4. TAIL CIRCUIT CHARGES
Tail Circuit charges shall be as notified by Scitor ITS. Tail Circuit
charges are monthly charges adjusted in line with actual charges from
PTTs. Customer shall be entitled to request Scitor ITS to review the
Tail Circuit charges for any Location and any changes to Tail Circuit
charges as a result of said review shall be effected the first day of
the month following such review. No credits for Tail Circuit charges
shall apply. Tail Circuit charges commence from the date of installation
of the Tail Circuit by the PTT.
5. MANAGEMENT CHARGES
TAIL CIRCUIT Customer shall pay monthly a charge of [*] of the Tail
Circuit charges or [*] whichever is the higher. This charge is in
addition to Tail Circuit charges.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
Attachment 2, Page 1
<PAGE> 18
NUI Customer shall pay monthly a charge of [*] per Location.
6. EQUIPMENT RENTAL CHARGES
Equipment rental charges applicable to this Agreement shall be as
specified in the Schedule. These charges shall be fixed for the Initial
Term of this Agreement. Equipment rental charges shall commence on the
date of commissioning of the Service at a Location.
7. SOFTWARE LICENSE FEES
The software license fees shall be as specified in the Schedule and
shall be payable upon the date of delivery of the Software to Customer
(unless integral to the Equipment).
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
Attachment 2, Page 2
<PAGE> 19
SCHEDULE X.25 AND X.28 CHARGES
1. MONTHLY PORT CHARGES
<TABLE>
<CAPTION>
LINE
LOCATION SERVICE SPEED FIXED PORT($) TRAFFIC($ PER MB)
- ------------- ----------- -------- --------------------- -------------------
<S> <C> <C> <C> <C>
[*] [*] [*] [*] N/A (waived through
31 December 1996)
[*] [*] [*] [*] (after 1/1/97) N/A
[*] [*] [*]
[*] [*] [*] each
[*] Telehousing [*]
</TABLE>
1.1 Customer understands that the X.28 connections are Scitor ITS'
asynchronous public shared rotary dial-up Service.
1.2 All other port charges shall be as notified to Customer by Scitor
ITS from time to time.
1.3 All X.28 Public Dial connection charges will be billed at a rate of
[*] per hour through 31 December 1996. Effective 1 January 1996, these charges
will be invoiced in accordance with the Schedule of Public x.28 Connection
Charges included on Page 2 to Attachment 2 of this Agreement.
2. CONNECTION CHARGES (ONE TIME)
<TABLE>
<CAPTION>
Location Charge $ Service
- ------------- -------- ---------------------
<S> <C> <C>
[*] [*] [*]
[*] [*] [*]
[*] [*] [*] (per connection)
</TABLE>
All other connection charges shall be as notified to Customer by Scitor ITS from
time to time.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
Schedule, Page 1
<PAGE> 20
SCHEDULE PUBLIC X.28 CONNECTION CHARGES
<TABLE>
<CAPTION>
ZONE NUI ZONE 1 ZONE 2 ZONE 3 ZONE 4 ZONE 5
Per Mth $ Per Hour $ Per Hour $ Per Hour $ Per Hour $ Per Hour $
- ------ --------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
ZONE 1 [*] [*] [*] [*] [*] [*]
ZONE 2 [*] [*] [*] [*] [*] [*]
ZONE 3 [*] [*] [*] [*] [*] [*]
ZONE 4 [*] [*] [*] [*] [*] [*]
ZONE 5 [*] [*] [*] [*] [*] [*]
ZONE 6 [*] [*] [*] [*] [*] [*]
ZONE 7 [*] [*] [*] [*] [*] [*]
</TABLE>
Schedule, Page 2
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
<PAGE> 21
ZONES
<TABLE>
<CAPTION>
ZONE 1 ZONE 2 ZONE 3 ZONE 4 ZONE S ZONE 6 ZONE 7
- ----------- -------------- ------- ----------- ------------ --------- ------
<S> <C> <C> <C> <C> <C> <C>
[*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*]
[*] [*]
[*] [*]
[*]
[*]
</TABLE>
[*]
[*]
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
Schedule, Page 3
<PAGE> 22
ATTACHMENT 3 - LOCATIONS
1. The Locations to be provided with the Service shall be as specified in
the schedule to Attachment 2 ("Schedule").
2. Customer agrees to commit to use the Service for a minimum of thirty six
(36) months at all Locations from the Date of Connection of the Service
as specified in Attachment 4 (or the actual Date of Connection if
different) subject to the following exceptions:
2.1 Customer terminates this Agreement under Clause 3.2;
2.2 Customer substitutes any Location with a new Location provided
Scitor ITS is able to provide Service at the new Location. Scitor ITS shall be
entitled to invoice Customer a connection and project management charge for the
new Location as agreed by the Parties;
2.3 Customer may remove a Location if Customer is unable to conduct its
business at that Location due to Force Majeure. This provision may only be
invoked by Customer after 30 continuous days of Force Majeure;
3. Any cancellation of Service at a Location under Clauses 2.2 and 2.3
above (but not pursuant to Clause 2.1 of this Attachment 3 where there
are no conditions other than as set forth in the Agreement at the
appropriate clauses) shall be conditional on the following:
3.1 Customer must give Scitor ITS at least 60 days prior written notice;
3.2 Customer shall remain responsible for any Tail Circuit charges
(including cancellation penalties) relevant to the Location where cancellation
of Service has been requested, but Scitor ITS shall, on a best efforts basis,
mitigate such costs by terminating any rental contracts with PTTs as soon as
practically possible, following written notification by Customer;
3.3 Customer shall pay to Scitor ITS a disconnection fee of [*] per
canceled Location;
3.4 Customer shall remain responsible for the duration of the term of
this Agreement for payment of the monthly rental charges for the Equipment.
Customer may discharge this responsibility at any time by paying Scitor ITS a
lump sum equal to the depreciated value of the Equipment, as at the date of
notice of cancellation, based on the original price paid by Scitor ITS or its
Sub- Contractors for the Equipment plus 15% of such original price as a fee for
administration and disconnection. Customer understands that Scitor ITS
depreciates the Equipment over 3 years. Scitor ITS will transfer the Equipment
to a substitute Location on payment of a reconnection charge agreed by the
Parties and in addition Scitor ITS's travel and out of pocket expenses. A
transfer shall not affect the rental term.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
Attachment 3, Page 1
<PAGE> 23
ATTACHMENT 4 - COMMISSIONING
1. DATES OF CONNECTION
1.1 Scitor ITS shall connect the Service at the Location on the
following Dates of Connection:
<TABLE>
<CAPTION>
Location Date of Connection
- ----------------- ------------------
<S> <C>
San Francisco, CA 1 November 1996
</TABLE>
1.2 Scitor ITS shall use reasonable efforts to connect the Service at
the Locations on the above Dates of Connection, but shall have no
responsibility, nor liability for delays unless caused by the negligence of
Scitor ITS. In the event of any such delays Scitor ITS shall use reasonable
efforts to provide the Service as set out in this Agreement at the earliest
opportunity. Scitor ITS reserves the right to connect an interim service should
such delays occur.
1.3 Customer shall use reasonable efforts to accept the Service at the
Locations on the Dates of Connection as set out above. Should Customer request
to delay any Date of Connection after the Effective Date of this Agreement, such
request if reasonable shall be agreed by Scitor ITS but any such delays agreed
to by Scitor ITS shall not affect Customer's obligations to: (a) reimburse
Scitor ITS for all PTT and other third party vendor charges in respect of Tail
Circuits and communications equipment incurred from the date of any contract
between Scitor ITS and any PTT or other third party vendor; and, (b) to accept
Service at such affected Locations as soon as possible after the reason for the
delay has been corrected.
1.4 Customer also understands that should Scitor ITS or its agents or
Sub-Contractors carry out a visit to a Location in order to connect the Service,
and be then unable to do so as a result of any act or omission by Customer,
Scitor ITS reserves the right to charge Customer for such visit at its then
current manpower rates for such time and its reasonable travel and out of pocket
expenses.
2. COMMISSIONING
Commissioning shall mean that Scitor ITS or its Sub-Contractors shall
carry out the following Commissioning Tests at each Location as appropriate from
Scitor ITS sites remote to the Customer Locations.
3. COMMISSIONING TESTS
3.1 TAIL CIRCUIT
To run three 15 minute Bit Error Rate Tests to ensure that no more than
one error in 10[6] data bits occur on the Tail Circuit.
Attachment 4, Page 1
<PAGE> 24
3.2 ALTERNATIVE TESTING
Where local PTT operating conditions are such that the above
commissioning tests are not appropriate, Scitor ITS is entitled to carry out
alternative commissioning tests as agreed to by Customer. In this event Scitor
ITS shall provide to the Customer a description of these alternative
commissioning tests.
Attachment 4, Page 2
<PAGE> 25
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
AMENDMENT NO. 1
TO THE MANAGED DATA NETWORK SERVICES AGREEMENT NO.
MDNS/US/IPAS/09/96/99
DATED SEPTEMBER 17, 1996
BETWEEN SCITOR INTERNATIONAL TELECOMMUNICATIONS SERVICES, INC.
(SCITOR ITS)
AND
I-PASS ALLIANCE, INC. (CUSTOMER)
This Amendment is made by and between Scitor ITS having its principal
place of business located at 3100 Cumberland Circle, Suite 1200, Atlanta,
Georgia 30339 and Customer, having its principal place of business located at
555 Bryant Avenue, #248, Palo Alto, California 94301.
In consideration of the covenants, premises and agreements set forth
below, and in consideration of those set forth in the Agreement which this
Amendment supplements, the parties do hereby agree as follows:
The Schedule to Attachment 2 shall be replaced in its entirety by the
revised Schedule to Attachment 2, attached hereto and made a part hereof this
Amendment No. 1 and the Agreement.
All other terms and conditions are as set forth in the Agreement shall
remain in full force and effect.
Customer and Scitor ITS each represent to the other that it has due and
proper authority to enter into this Amendment to the Agreement and to make and
perform all duties and obligations set forth and contemplated by this Amendment.
IN WITNESS WHEREOF, this Amendment No. 1 was entered into as of the day
and year first written below.
Scitor International
Telecommunications i-Pass Alliance, Inc.
By: /s/ BARRY R. GOODMAN By: /s/ CHRIS MOORE
-------------------------------- -----------------------------------
Printed Name: Barry R. Goodman Printed Name: Chris Moore
---------------------- -------------------------
Title: Director, Commercial Affairs Title: President/CEO
----------------------------- --------------------------------
Dated: 2/2/97 Dated: 12/30/96
----------------------------- --------------------------------
<PAGE> 26
SCHEDULE X.25 AND X.28 CHANGES
1. MONTHLY PORT CHARGES
<TABLE>
<CAPTION>
LOCATION SERVICE LINE SPEED FIXED PORT($) TRAFFIC($ PER MB)
- ------------- ---------- ---------- ---------------------- -------------------
<S> <C> <C> <C> <C>
[*] [*] [*] [*] [*] (waived through
2/28/97)
[*] [*] [*] [*] (after 3/1/97) N/A
[*] [*] [*]
[*] [*] [*]
[*] [*]
</TABLE>
1.1 Customer understands that the X.28 connections are Scitor ITS'
asynchronous public shared rotary dial-up Service.
1.2 All other port charges shall be as notified to Customer by Scitor ITS
from time to time.
2. CONNECTION CHARGES
(ONE TIME)
<TABLE>
<CAPTION>
LOCATION CHARGE $ SERVICE
------------- -------- ---------------------
<S> <C> <C>
[*] [*] [*]
[*] [*] [*]
[*] [*] [*]
</TABLE>
All other connection charges shall be as notified to Customer by Scitor
ITS from time to time.
3. Through February 28, 1997, the connection charges per hour will be [*]
per hour across all zones. Effective March 1, 1997, the below X.28
public dial pricing matrix will be in effect.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
2.
<PAGE> 27
SCHEDULE PUBLIC X.28 CONNECTION CHARGES
<TABLE>
<CAPTION>
NUI
PER MTH
ZONE $ ZONE 1 ZONE 2 ZONE 3 ZONE 4 ZONE 5 ZONE 6 ZONE 7
- ------ -------- ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ZONE 1 [*] [*] [*] [*] [*] [*] [*] [*]
ZONE 2 [*] [*] [*] [*] [*] [*] [*] [*]
ZONE 3 [*] [*] [*] [*] [*] [*] [*] [*]
ZONE 4 [*] [*] [*] [*] [*] [*] [*] [*]
ZONE 5 [*] [*] [*] [*] [*] [*] [*] [*]
ZONE 6 [*] [*] [*] [*] [*] [*] [*] [*]
ZONE 7 [*] [*] [*] [*] [*] [*] [*] [*]
</TABLE>
NOTE: IN COUNTRY USAGE CHARGES PER HOUR ARE AS FOLLOWS:
<TABLE>
<CAPTION>
[*] [*] [*] [*] [*]
-- -- ------ ------- -----
<S> <C> <C> <C> <C>
[*] [*] [*] [*] [*]
</TABLE>
ZONES
<TABLE>
<CAPTION>
ZONE 1 ZONE 2 ZONE 3 ZONE 4 ZONE 5 ZONE 6 ZONE 7
- ------------ -------------- ------ ----------- ------------ ------------ -----------------
<S> <C> <C> <C> <C> <C> <C>
[*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*]
[*] [*]
[*]
UK
</TABLE>
[*]
[*]
[*]
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
3.
<PAGE> 28
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
AMENDMENT NO. 2
TO THE MANAGED DATA NETWORK SERVICES AGREEMENT
NO. MDNS/US/TPAS/09/96/99
("AGREEMENT")
BETWEEN EQUANT NETWORK SERVICES, INC. ("EQUANT")
AND
I-PASS ALLIANCE, INC. ("CUSTOMER")
This Amendment No. 2 ("Amendment") is made by and between EQUANT and Customer
and shall be effective as of October 1, 1998 ("Effective Date").
In consideration of the covenants, premises and agreements set forth below, and
in consideration of those set forth in the Agreement, which this Amendment
supplements and modifies, the parties do hereby agree as follows:
1. Year 2000 Compliance
The Agreement is hereby amended by renumbering the existing Clause 7 as
Clause 7.1 and inserting the following as new Clause 7.2:
"7.2 EQUANT warrants that all software (including the Software
and any firmware), hardware, networks and equipment (together
"Systems") over which it has Control (as defined below) used in
connection with the provision, running and operation of the
Service ("EQUANT Systems") will be Year 2000 Compliant (as
defined below) by December 31, 1998. In respect of relevant
Systems that EQUANT does not Control, including without
limitation, all relevant Systems operated by, or proprietary to,
telecommunications operators, EQUANT shall endeavor to obtain a
Year 2000 Compliance statement from the relevant suppliers and
shall advise Customer as to the results thereof and thereafter
keep Customer informed of changes in status. EQUANT shall use
reasonable endeavors to mitigate any fault in the Service caused
by the non-Year 2000 Compliance of any Systems it does not
Control, but shall not be liable to Customer for any loss or
damages in the event that any such non-Year 2000 Compliance
causes a fault in, or the non-availability of, the Service.
7.2.1 Customer shall ensure that any of its programs or Systems
or data into which the Systems used in the provision, running
and operation of the Service will communicate or integrate are
Year 2000 Compliant.
7.2.2 EQUANT shall not be liable for any faults in or
non-availability of the Service or Systems provided under this
Agreement which arise out of non-Year 2000 Compliance except to
the extent expressly provide above. Furthermore, EQUANT shall
have no liability under the above warranty for any breach
arising from the use of non-Year 2000 Compliant Systems or data
with EQUANT Systems.
Page 1 of 5
<PAGE> 29
7.2.3 For the purposes of this Agreement, EQUANT shall be deemed
to "Control" a System if it (or any Associated Company of
EQUANT) operates (or has given the Customer the right to use
under this Agreement) and owns the intellectual property rights
to the System; and "Year 2000 Compliant/ce" means Year 2000
conformity as that term is defined in DISC PD2000-1 published by
the British Standards Institution."
2. EXCLUSIONS AND LIMITATIONS OF LIABILITY
The Agreement is hereby amended by deleting Clause 10.3 in its entirety
and substituting the following therefor:
"EXCEPT FOR SHORTFALL CHARGES RESULTING FROM THE FAILURE TO
SATISFY THE MINIMUM REVENUE COMMITMENTS SET FORTH IN ATTACHMENT
2, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY
INCIDENTAL, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES HOWSOEVER
ARISING, INCLUDING BUT NOT LIMITED TO, ANY DAMAGES FOR LOST
TIME, INCOME, REVENUE, CLIENTS' GOODWILL, PROFITS, OR OTHER
SIMILAR ITEMS, OR ANY BUSINESS INTERRUPTION OF ANY KIND, EVEN IF
THE OTHER PARTY HAS BEEN INFORMED OF THE POSSIBILITY OF SUCH
DAMAGES IN ADVANCE."
3. MINIMUM VOLUME COMMITMENT
The Agreement is hereby amended by adding the following new Clause 8 to
Attachment 2:
"8. MINIMUM VOLUME COMMITMENT
During each "Commitment Period" specified below (as measured
from the Effective Date of this Amendment), Customer shall
satisfy the corresponding minimum volume commitment based on
Customer's combined usage of X.25, X.28, and Remote LAN Access
services (each such minimum volume commitment referred to as an
"MVC"):
<TABLE>
<CAPTION>
Commitment Period MVC
----------------- ----------
<S> <C>
Months 1-3 [*]
Months 4-15 [*]
</TABLE>
Each MVC shall be calculated after application of all discounts
using Customer's monthly recurring Port, Dial Access, and Remote
LAN Access service charges and usage charges set forth in this
Attachment 2, excluding one-time charges, Tail
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
Page 2 of 5
<PAGE> 30
Circuit Charges, Tail Circuit Management Charges, and CPE
Charges ("Qualifying Charges").
Should the actual Qualifying Charges invoiced to Customer during
any Commitment Period be less than the applicable MVC
("Shortfall"), EQUANT shall invoice, and Customer shall pay, the
Shortfall in accordance with Clause 9 of the Agreement.
Alternatively, EQUANT and Customer may agree to extend the
Initial Term for such a period so as to cover all or part of the
Shortfall ("Grace Period"). Notwithstanding the foregoing, in no
event shall the Grace Period exceed six (6) months. EQUANT shall
invoice, and Customer shall pay, any Shortfall balance remaining
at the end of the Grace Period in accordance with Clause 9 of
the Agreement."
4. PUBLIC X.28 CONNECTION CHARGES
Attachment 2 of the Agreement is hereby amended by deleting the Schedule
of Public X.28 Connection Charges in its entirety and substituting the
following therefor:
"SCHEDULE- PUBLIC X.28 CONNECTION CHARGES
<TABLE>
<CAPTION>
ZONE FLAT CHARGE
PER HOUR ($)
---- ------------
<S> <C> <C>
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
</TABLE>
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
Page 3 of 5
<PAGE> 31
SCHEDULE - PUBLIC X.28 CONNECTION CHARGES (CONTINUED)
<TABLE>
<CAPTION>
FLAT CHARGE
ZONE PER HOUR($)
---- -----------
<S> <C>
7 [*]
8 [*] (except for [*] and The [*], which will be [*])
9 [*]
10 [*] (except for [*], which will be [*])
11 [*]
12 [*]
13 [*]
14 [*]
</TABLE>
5. ZONES
Attachment 2 of the Agreement is hereby amended by deleting the Schedule
of Zones in its entirety and substituting the following therefor:
"ZONES
* EQUANT PRICES PLUS LOCAL PUBLIC DATA NETWORK ("PDN") CHARGES
<TABLE>
<CAPTION>
ZONE 1 ZONE 2 ZONE 3 ZONE 4 ZONE 5 ZONE 6 ZONE 7
--------------------- ------- ---------- ------------------------------------ ------ ------ ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*]
[*]
[*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*]
[*]
[*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*]
</TABLE>
<TABLE>
<CAPTION>
ZONE 8 ZONE 9 ZONE 10 ZONE 11 ZONE 12 ZONE 13
- ------------ ---------- ------- ----------------------- ----------------------- --------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*]
[*] [*]
</TABLE>
[*]
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
Page 4 of 5
<PAGE> 32
EQUANT does not represent or warrant that it can provide the Service in the
above countries." Amendment No. 2 I-Pass Alliance. Inc.
All other terms and conditions are as set forth in the Agreement shall remain in
full force and effect.
This Amendment, including the Agreement and applicable Order Forms, is the
complete agreement of the parties and supersedes any prior agreements or
representations, whether written or oral, with respect thereto.
Customer and EQUANT each represent to the other that it has due and proper
authority to enter into this Amendment to the Agreement and to make and perform
all duties and obligations set forth and contemplated by this Amendment.
IN WITNESS WHEREOF, this Amendment was entered into as of the dates set forth
below, effective as of the Effective Date.
EQUANT NETWORK SERVICES, INC. I-PASS ALLIANCE, INC.
By: /s/ B.J. BORENSEN By: /s/ CHRIS MOORE
------------------------------- -------------------------------------
Printed Name: B.J. Borensen Printed Name: Chris Moore
--------------------- ---------------------------
Title: President Title: CEO
---------------------------- ----------------------------------
Dated: 10/19/98 Dated: 9/25/98
---------------------------- ----------------------------------
Page 5 of 5
<PAGE> 33
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
AMENDMENT NO. 3
TO THE MANAGED DATA NETWORK SERVICES AGREEMENT
NO. MI)NS/US/IPAS/09/96/99
("AGREEMENT")
BETWEEN EQUANT NETWORK SERVICES, INC. ("EQUANT")
AND
I-PASS ALLIANCE, INC. ("CUSTOMER")
This Amendment No. 3 ("Amendment") is made by and between EQUANT and Customer
and shall be effective as of October 1, 1998 ("Effective Date").
In consideration of the covenants, premises and agreements set forth below, and
in consideration of those set forth in the Agreement, which this Amendment
supplements and modifies, the parties do hereby agree as follows:
1.
The Agreement is hereby amended by adding the following new Clause 8 to
Attachment 2:
8. MINIMUM VOLUME COMMITMENT
During each "Commitment Period" specified below (as measured from the
Effective Date of this Amendment), Customer shall satisfy the
corresponding minimum volume commitment based on Customer's combined
usage of X.25, X.28, and Remote LAN Access services (each such minimum
volume commitment referred to as an "MVC"):
<TABLE>
<CAPTION>
Commitment Period MVC
----------------- ---
<S> <C> <C>
Months 1-3 [*]
Months 4-6 [*]
Months 7-12 [*]
Months 13-18 [*]
</TABLE>
Each MVC shall be calculated after application of all
discounts using Customer's monthly recurring Port, Dial
Access, and Remote LAN Access service charges and usage
charges set forth in this Attachment 2, excluding one-time
charges, Tail Circuit Charges, Tail Circuit Management
Charges, and CPE Charges ("Qualifying Charges").
Should the actual Qualifying Charges invoiced to Customer
during any Commitment Period be less than the applicable MVC
("Shortfall"), EQUANT
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
Page 1
<PAGE> 34
shall invoice, and Customer shall pay, the Shortfall in
accordance with Clause 9 of the Agreement.
Alternatively, EQUANT and Customer may agree to extend the
Initial Term for such a period so as to cover all or part of
the Shortfall ("Grace Period"). Notwithstanding the foregoing,
in no event shall the Grace Period exceed six (6) months.
EQUANT shall invoice, and Customer shall pay, any Shortfall
balance remaining at the end of the Grace Period in accordance
with Clause 9 of the Agreement."
All other terms and conditions are as set forth in the Agreement shall remain in
full force and effect.
This Amendment, including the Agreement, and applicable Order Forms, is the
complete agreement of the parties and supersedes any prior agreements or
representations, whether written or oral, with respect thereto.
Customer and EQUANT each represent to the other that it has due and proper
authority to enter into this Amendment to the Agreement and to make and perform
all duties and obligations set forth and contemplated by this Amendment.
IN WITNESS WHEREOF, this Amendment was entered into as of the dates set forth
below, effective as of the Effective Date.
EQUANT NETWORK SERVICES, INC. I-PASS ALLIANCE, INC.
By: /s/ JIM WILKES By: /s/ RONALD CALANDRA
------------------------------- -------------------------------------
Printed Name: Jim Wilkes Printed Name: Ronald Calandra
--------------------- ---------------------------
Title: Sr. V.P. Title: V.P. Operations
---------------------------- ----------------------------------
Dated: Dated: 6-2-99
---------------------------- ----------------------------------
Page 2
<PAGE> 35
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
AMENDMENT NO. 4
TO THE MANAGED DATA NETWORK SERVICES AGREEMENT
NO. MDNS/US/IPAS/09/96/99
THIS AMENDMENT NO. 4 to the Managed Data Network Services Agreement No.
MDNS/US/IPAS/09/96/99 ("AMENDMENT") is made by and between EQUANT NETWORK
SERVICES, INC. ("EQUANT") and I-PASS ALLIANCE, INC. ("CUSTOMER"), and shall be
effective as of December 1, 1999 ("Effective Date").
Customer and Equant entered into that certain Managed Data Network
Services Agreement Number MIDNS/US/IPAS/09/96/99 executed by Customer on
September 17, 1996, (the "MDNSA"), Amendment No. 1 to the MDNSA executed by
Customer on December 30, 1996, Amendment No. 2 to the MDNSA effective on October
1, 1998 and Amendment No. 3 to the MDNSA effective October 1, 1998 (all of the
above being the "AGREEMENT"); and
Customer and Equant desire to amend the Agreement to reflect certain
changes;
NOW, in accordance with the procedures for amendment of the Agreement
set forth in Section 15.8 of the NMNSA and in consideration of the premises, the
terms and conditions set forth below, and other good and valuable consideration,
the sufficiency of which is hereby acknowledged, the parties do hereby agree as
follows:
1. X.28 AND PPP DIAL DISCOUNTS
Effective as of the December 1999 monthly billing cycle, Customer will
be entitled to a discount of [*] against all monthly X.28 and PPP Dial
charges incurred that are in excess of $[*] a month and additional host
access facilities, that is, X.25 p6l-ts/circuit/LANAS routers) will be
provided free of charge.
2. ENTIRE AGREEMENT
Except as expressly modified by this Amendment, the Agreement shall
remain in full force and effect according to its terms. This Amendment,
including the Agreement and applicable Order Forms, is the complete
agreement of the parties and supersedes any prior agreements or
representations, whether written or oral, with respect to the subject
matter hereto.
The discounts set forth in this Amendment shall be contingent upon
Customer's payment of the outstanding balance due as of September 1999
on its account of $[*] no later than three (3) months from the Effective
Date of this Amendment.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
1
<PAGE> 36
IN WITNESS WHEREOF, this Amendment was entered into as of the dates set
forth below, effective as of the Effective Date.
EQUANT SERVICES, INC. I-PASS ALLIANCE, INC.
By: /s/ JIM WILKES By: /s/ RON CALANDRA
----------------------------- -------------------------------
Printed Name: Jim Wilkes Printed Name: Ron Calandra
------------------- ---------------------
Title: Senior Vice President Title: Vice President, Operations
-------------------------- ----------------------------
Date: 1/18/00 Date: 12/15/99
--------------------------- ----------------------------
2
<PAGE> 37
AMENDMENT NO. 5
TO THE MANAGED DATA NETWORK SERVICES AGREEMENT
NO. MDNS/US/IPAS/09/96/99
This Amendment No. 5 to the Managed Data Network Services Agreement No.
MDNS/US/EPAS/09/96/99 ("AMENDMENT") is made by and between EQUANT NETWORK
SERVICES, INC. ("EQUANT") and I-PASS ALLIANCE, INC. ("CUSTOMER"), and shall be
effective as of February 4, 2000 ("EFFECTIVE DATE").
Customer and Equant entered into that certain Managed Data Network
Services Agreement Number MDNS/US/IPAS/09/96/99 executed by Customer on
September 17, 1996, (the "MDNSA"), Amendment No. 1 to the NMNSA executed by
Customer on December 30, 1996 ("AMENDMENT 1"), Amendment No. 2 to the MDNSA
effective on October 1, 1998 ("AMENDMENT 2"), Amendment No. 3 to the MDNSA
effective October 1, 1998 ("AMENDMENT 3") and Amendment 4 to the MDNSA effective
December 1, 1999 ("AMENDMENT 4") (all of the above being the "AGREEMENT"); and
WHEREAS, Customer and Equant desire to amend the Agreement to reflect
certain changes;
WHEREAS, Customer has changed its name to iPass, Inc.;
NOW, in accordance with the procedures for amendment of the Agreement
set forth in Section 15.8 of the MDNSA and in consideration of the premises, the
terms and conditions set forth below,. and other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the parties do
hereby agree as follows:
1. DEFINITIONS
All capitalized terms used in this Amendment shall have the respective
meanings given to such terms in the Agreement unless otherwise set forth
in this Amendment.
2. MODIFIED SCOPE OF AGREEMENT
Notwithstanding anything contained in the Agreement to the contrary,
Customer will be permitted to use the Network for the limited purpose of
transporting data from it's customers, including internet service
providers, to Customer's internet gateway.
3. EXTENSION OF INITIAL TERM
The Initial Term of the Agreement is hereby extended for a period of
forty-eight (48) months from the Effective Date of this Amendment.
4. MINIMUM VOLUME COMMITMENT & DISCOUNTS
Customer has met and/or exceeded all prior Minimum Volume Commitments as
that term is defined in Amendments 2 and 3. Customer agrees to commit to
the following new Minimum Revenue Commitment from the Effective Date of
this Amendment.
1
<PAGE> 38
Accordingly, the Agreement is hereby amended by adding the following new
Clause 8 to Attachment 2:
8. Minimum Volume Commitment
8.1 During each "Commitment Period" specified below (as measured from
the Effective Date of this Amendment), Customer shall satisfy the
corresponding minimum volume commitment based on Customer's
combined usage of X.25, X.28, and Remote LAN Access services
(each such "minimum volume commitment" will be referred to herein
as an "MVC"):
<TABLE>
<CAPTION>
COMMITMENT PERIOD MVC
----------------- ----------
<S> <C> <C>
Months 1 to 12 $[*]
Months 13 to 24 $[*]
Months 25 to 36 $[*]
Months 37 to 48 $[*]
</TABLE>
Each WC shall be calculated after application of all discounts
using Customer's monthly recurring Port, Dial Access, and Remote
LAN Access service charges and usage charges set forth in this
Attachment 2, excluding one-time charges, Tail Circuit Charges,
Tail Circuit Management Charges, and CPE Charges ("QUALIFYING
CHARGES").
Should the actual Qualifying Charges invoiced to Customer during
any Commitment Period be less than the applicable MVC
("SHORTFALL"), Equant shall invoice, and Customer shall pay, the
Shortfall at the end of the applicable Commitment Period that
such Shortfall occurred in accordance with Clause 9 of the
Agreement.
8.2 Equant will provide any additional new host access facilities,
that is, X.25 ports/circuit/LANAS routers) free of charge,
provided however that Customer has met and/or exceeded the MVCs
as set forth herein."
5. PUBLIC X.28 CONNECTION CHARGES
Clause 4 of Amendment 2 is hereby amended by deleting the Schedule of
Public X.28 Connection Charges in its entirety and substituting the
following therefor:
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
2
<PAGE> 39
"SCHEDULE - PUBLIC X.28 CONNECTION CHARGES"
<TABLE>
<CAPTION>
Flat Charge
Zone per Hour ($)
---- ------------
<S> <C> <C>
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8 [*]
9 [*]
10 [*]
12 [*]
13 [*]
14 [*]
</TABLE>
6. ZONES
Clause 5 of Amendment 2 is hereby amended by deleting the Schedule of
Zones in its entirety and substituting the revised Schedule of Zones
attached to this Amendment as Attachment 2.
7. ENTIRE AGREEMENT
Except as expressly modified by this Amendment, the Agreement shall
remain in full force and effect according to its terms. This Amendment,
including the Agreement and applicable Order Forms, is the complete
agreement of the parties and supersedes any prior agreements or
representations, whether written or oral, with respect to the subject
matter hereto, including Amendment 4.
Provided this Amendment is accepted and executed by Equant, all charges,
discounts or rates set forth in this Amendment shall be effective
beginning with the first full billing cycle following Customer's
execution and delivery of this Amendment to Equant unless expressly
stated otherwise.
IN WITNESS WHEREOF, this Amendment was entered into as of the dates set
forth below, effective as of the Effective Date.
EQUANT NETWORK SERVICES, INC. IPASS, INC.
By: /s/ JIM WILKES By: /s/ MICHAEL MANSOURI
----------------------------- ---------------------------------
Printed Name: J.C. WILKES Printed Name: Michael Mansouri
------------------- -----------------------
Title: S.V.P. AMERICAS Title: Chairman & CEO
-------------------------- ------------------------------
Dated: 2-16-00 Dated: February 4, 2000
-------------------------- ------------------------------
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
3
<PAGE> 40
ATTACHMENT 2
SCHEDULE OF ZONES
[*]
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
ZONE 1 ZONE 2 ZONE 3 ZONE 4 ZONE 5 ZONE 6 ZONE 7
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
[*] [*] [*] [*] [*]
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
ZONE 8 ZONE 9 ZONE 10 ZONE 11 ZONE 12 ZONE 13
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*] [*]
[*] [*] [*] [*] [*] [*]
[*] [*]
[*]
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
[*]
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
<PAGE> 1
EXHIBIT 10.19
OEM SERVICE PROVIDER LICENSE AGREEMENT
RSA SECURITY, INC.
Thank you for choosing to do business with us. This Agreement has the purpose of
licensing you the right to (i) incorporate the RSA Software into your products
and (ii) use and/or distribute to end users the RSA Software solely as
incorporated into such products for the purpose of providing Your service. In
return, You agree to pay RSA the license fees described in this Agreement (or
its attachments) which typically comprise an initial payment of license fees,
plus ongoing royalties, but, alternatively may consist of annual license fee
amount, paid-up license fee amounts or other arrangements as described in this
Agreement. This license is for object code only. Maintenance and support for the
RSA Software licensed, if elected, is under separate terms and conditions. This
License Agreement is to be construed and interpreted in accordance with this
general purpose, though any conflict between this general purpose and the
express terms found in this Agreement shall be resolved in favor of the express
terms.
ENTERPRISE NAME ("YOU"): iPass Inc. JURISDICTION OF INCORPORATION: California
STREET ADDRESS: 3800 Bridge Parkway STATE & ZIP CODE: California 94065
CITY: Redwood Shores
ENTERPRISE LEGAL CONTACT (NAME & TITLE):
AGREEMENT NUMBER: 0200-iPA-SER-2
This LICENSE AGREEMENT (the "Agreement"), effective as of the later date of
execution ("Effective Date"), is entered into by and between RSA Security, Inc.,
a Delaware corporation ("RSA"), having a principal address at 2955 Campus Drive,
Suite 400, San Mateo, CA 94403-2507, and the Enterprise identified above.
1. DEFINITIONS
The following terms when used in this Agreement shall have the following
meanings:
1.1 "DISTRIBUTOR" means a dealer or distributor in the business of
relicensing or distributing Client Licensed Products to End User Customers,
directly or through one or more Distributors, by virtue of authority granted by
You for the purpose of providing the Licensed Service. Client Licensed Products
relicensed or distributed by a Distributor shall bear Your trademarks and
service marks and shall not be privately labeled by such Distributor or other
parties. A Distributor shall have no right to add to or modify any part of a
Licensed Product.
1.2 "END USER CUSTOMER" means a person or an entity receiving the RSA
Software as part of a Client Licensed Product from You or a Distributor for
personal or internal use to obtain the Licensed Service and primarily not for
resale, redistribution or other transfer of such Client Licensed Product to any
other person or entity.
1.
<PAGE> 2
1.3 "LICENSED PRODUCT(S)" means one or more of Your products or product
groups identified in the attached "License/Product Schedule Exhibit" which has
been or will be developed by You and which incorporates in any manner any
portion of the RSA Software. A Licensed Product (i) must represent a significant
functional and value enhancement to the RSA Software, (ii) shall not expose or,
directly or indirectly, pass through any APIs, and (iii) shall not be a security
add-on or "bolt-on," the primary purpose of which is providing security to a
third party's product. A Licensed Product consists of a client component
("Client Licensed Product") and a server component ("Server Licensed Product").
Each component of a Licensed Product shall be capable of operating only in
conjunction with the other component. The Server Licensed Product must be owned
and operated by You at Your site, and You shall have no right to change a
license fee or comparable fee for distribution of the Client Licensed Product.
1.4 "LICENSED SERVICE(S)" means one or more of Your services identified
in the attached "License/Product Schedule Exhibit" which has been or will be
developed by You and which uses or is supported by the Licensed Products. The
Licensed Service must represent a significant functional and value enhancement
to the RSA Software, such that the primary reason for an End User Customer to
obtain the Licensed Service is other than the right to use the RSA Software.
Only You may provide the Licensed Service.
1.5 "RSA SOFTWARE" means RSA's proprietary software identified on the
attached "License/Product Schedule Exhibit" (and including only those algorithms
listed therewith), as further described in the User Manual(s) associated
therewith.
1.6 "UPDATES" means any new version of the RSA Software designated by a
progressing of the release number (either right or left of the decimal point)
following the version initially shipped hereunder.
1.7 "USER MANUAL" means the most current version of the user manual
and/or reference manual customarily supplied by RSA to entities who license the
RSA Software.
1.8 "SUBSCRIBER" means a person or entity to whom a copy/unit of the
Client Licensed Product has been distributed and who has paid You any cash or
in-kind consideration at any time for the Licensed Service, whether as use,
transaction, subscription, or service fees or any comparable fees based on or
involving the use of the Licensed Service. You shall have no right to charge a
license fee or comparable fee for distribution of the Client Licensed Product.
2. LICENSES
2.1 LICENSE GRANT. During the term of this Agreement and within the
Field of Use limitation set forth in the "License/Product Schedule Exhibit"
attached hereto RSA hereby grants You a non-exclusive, non-transferable license
to:
2.1.1 (i) incorporate the RSA Software in object or byte code
format into a Licensed Product; (ii) reproduce and have reproduced the RSA
Software in object or byte code format as incorporated in a License Product and
as reasonably needed for inactive backup or archival purposes; (iii) license or
otherwise distribute the RSA Software in the Territory as incorporated in a
Client Licensed Product (if distribution of such Licensed Product is not
prohibited in the attached "Licensed/Product Schedule Exhibit") to End User
Customers, directly
2.
<PAGE> 3
or indirectly through one or more Distributors; and (iv) reproduce, have
reproduced and distribute the RSA Software in the Territory as incorporated in a
Licensed Product to Your employees at Your site(s) and for use by such employees
solely for the purpose of providing the Licensed Service to End User Customers
or supporting the Licensed Service.
2.1.2 (i) use the User Manual to support End User Customers and the
Licensed Service; (ii) modify and incorporate any or all of the User Manual in
Licensed Product and Licensed Service documentation; (iii) reproduce, have
reproduced and distribute in the Territory such portions of the User Manual as
incorporated in Licensed Product documentation to Your employees at Your site(s)
and for use by such employees solely for the purpose of providing the Licensed
Service to End User Customers or supporting the Licensed Service; and (iv)
reproduce and have reproduced and distribute in the Territory such portions of
the User Manual as incorporated in Licensed Product and Licensed Service
documentation to End User Customers.
2.2 LIMITATIONS ON LICENSES. Notwithstanding the generality of the
foregoing: You may not in any way sell, lease, rent, license, sublicense or
otherwise distribute the RSA Software, except as part of a Client Licensed
Product whose distribution is not prohibited on the attached "License/Product
Schedule Exhibit". Such distribution must be for the sole purpose of providing
the Licensed Service. The RSA Software may only be accessed by the functionality
of the Licensed Product in which it is included, and a Licensed Product shall
not make the RSA Software directly accessible to End User Customers or to
products other than the Licensed Product, or otherwise expose an API. Nothing in
this Agreement grants You any rights, license or interest with respect to source
code of the RSA Software. You shall not modify, translate reverse engineer,
decompile or disassemble the RSA Software or any part thereof or otherwise
attempt to derive source code or create derivative works therefrom, and shall
not authorize any third party to do any of the foregoing.
3. OWNERSHIP/PROPRIETARY RIGHTS
3.1 RSA SOFTWARE TITLE. Except for the limited licenses expressly
granted in Section 2.1 and as further limited by Section 2.2, RSA does not by
this Agreement grant You any right, title or ownership interest in or to the RSA
Software or in any related patents, trademarks, copyrights of proprietary or
trade secret rights. Similarly, RSA receives no right, title or ownership
interest in any of Your products by way of this Agreement.
3.2 RSA COPYRIGHT NOTICES. You agree not to remove, alter or destroy any
proprietary, trademark or copyright markings or notices placed upon or contained
within the RSA Software, User Manuals or any related materials or documentation.
You further agree to insert and maintain within every Licensed Product and any
related materials or documentation a copyright notice in Your name.
3.3 TRADEMARKS. Except as provided in Section 6.1, You shall acquire no
rights of any kind in or to any RSA trademark, trade name, logo or product
designation under which the RSA Software was or is marketed and shall not make
any use of the same for any reason except as expressly authorized by this
Agreement or otherwise authorized in writing by RSA. You shall cease to use the
markings, or any similar markings, in any manner on the expiration or other
termination of this Agreement.
3.
<PAGE> 4
4. LICENSE FEES
4.1 LICENSE FEES. In consideration of RSA's granting you the license
rights in this Agreement, You agree to pay RSA the license fees and ongoing
royalties (collectively, "License Fees") set forth in the "License/Product
Schedule Exhibit" attached hereto.
4.2 TERMS OF PAYMENT - GENERAL. License Fees due RSA hereunder shall be
paid to the attention of the Software Licensing Department at RSA's address set
forth above. Payments of all License Fees shall be made in lawful United States
currency and shall in no case be refundable. A late payment penalty on any
License Fees not paid when due shall be assessed at the rate of one percent (1%)
per thirty (30) days, beginning on the thirty-first (31st) day after the delayed
payment was due. All taxes, duties, fees and other governmental charges of any
kind (including sales and use taxes, but excluding taxes based on the gross
revenues or net income of RSA) which are imposed by or under the authority of
any government or any political subdivision thereof on the License Fees or any
aspect of this Agreement shall be borne by You and shall not be considered a
part of, a deduction from, or an offset against License Fees.
4.3 LICENSES WITH ONGOING ROYALTIES. In the event You have elected to
pay License Fees based on ongoing royalties, as indicated on the attached
"License/Product Schedule Exhibit," You agree to pay the prepaid License Fees
and ongoing royalties as described therein and in accordance with the following:
4.3.1 PREPAYMENTS AND ONGOING ROYALTY PAYMENT. All prepaid license
fees ("Prepayments") may be offset against on-going royalties accrued until the
Prepayments are exhausted. You shall show the application or Prepayments in the
licensing reports provided to RSA pursuant to Section 4.3.2. Ongoing royalties
shall be paid on or before the thirtieth (30th) day after the close of the
calendar quarter during which such royalties accrued. Ongoing royalties shall
accrue with respect to the Licensed Service upon the date of invoice for the
Licensed Service to an End User Customer or the date payment therefor was first
payable to You, whichever occurs first. To the extent the License Fees described
in the "License/Product Schedule Exhibit" are based on Service Revenue, "Service
Revenue" means the gross amount of all cash, in-kind or other consideration
receivable by You at any time in consideration of providing the Licensed
Service, whether as use, transaction, subscription, or service fees, or any
comparable fees based on or involving the use of the Licensed Service. For the
purposes of determining Service Revenue, the amount of in-kind or other non-cash
consideration receivable by You shall be deemed to have a dollar value equal to
the standard price (as listed in Your published price schedule on the date the
Licensed Service is provided) for the Licensed Service, less all cash paid.
4.3.2 LICENSING REPORT AND RECORDS. You agree to provide to RSA on
or before the thirtieth (30th) day after the close of each calendar quarter
during the term of this Agreement (even if no royalty amounts have accrued or
are to be paid in such period) a report in reasonable detail setting forth the
calculation of License Fees due hereunder and signed by a responsible officer.
The report shall include, at a minimum, the following information with respect
to the relevant quarter: (i) the total Service Revenue accrued; (ii) the
relevant royalty rate applied to the Service Revenue; (iii) credit taken against
any Prepayments; and (iv) the total License Fees payable. Whether or not You
have elected to pay License Fees based on ongoing
4.
<PAGE> 5
royalties, You agree to maintain reasonable records relating to the Licensed
Products distributed, License Services provided and License Fees accrued and
paid for a period of five (5) years following the relevant dates. RSA shall have
the right, at its sole cost and expense, to have an independent certified public
accountant conduct during normal business hours (but not more than once in any
twelve (12) month period) an audit of Your records to verify compliance with the
terms of this Agreement. In the event such an audit discloses a discrepancy
between the amounts owed and the License Fees actually paid, You will be
invoiced or credited for any future amounts owed by You, as applicable. If any
deficiency in License Fees paid exceeds five percent (5%) of the License Fees
reported by You for any period, You agree to pay the reasonable expenses
associated with such audit, in addition to the deficiency.
4.3.3 EVALUATION COPIES. You may deliver copies of Client Licensed
Products whose distribution is not prohibited in the attached "License/Product
Schedule Exhibit" to prospective End User Customers on a trial basis for
evaluation purposes only (each, an "Evaluation Copy"). No License Fees shall be
reportable or payable with respect to Evaluation Copies unless and until (i) the
Licensed Service is activated using the applicable Client Licensed Product; (ii)
the End User Customer pays for or is invoiced for the Licensed Service; or (iii)
the End User Customer's use of the Evaluation Copy, for any reason, continues
beyond sixty (60) days, whichever occurs first.
4.4 MAINTENANCE AND SUPPORT SERVICE. You may elect to receive updates
and other support services for the RSA Software licensed hereunder under a
separate maintenance and support agreement by executing such an agreement and
paying the applicable fee. All Updates provided to You pursuant to such
maintenance and support agreement shall constitute licensed RSA Software under
this Agreement, and such Updates shall be governed by the terms hereof.
5. LIMITED WARRANTY
5.1 LIMITED WARRANTY. During the initial ninety (90) day term of this
Agreement, RSA warrants that the RSA Software will operate in material
conformance to RSA's published specifications for the RSA Software. RSA does not
warrant that the RSA Software or any portion thereof is error-free. Your
exclusive remedy, and RSA's entire liability shall be correction of any
warranted nonconformity as provided in Section 5.2. This limited warranty and
any obligations of RSA hereunder shall not apply to nonconformities caused by
any unauthorized modification made to the RSA Software.
5.2 ERROR CORRECTION. In the event You discover an error in the RSA
Software which causes the RSA Software not to operate in material conformance to
RSA's published specifications therefor, You shall submit to RSA a written
report describing such error in sufficient detail to permit RSA to reproduce
such error. Upon receipt of any such written report, RSA will use its reasonable
business judgment to classify a reported error as either (i) a "Level 1
Severity" error, meaning an error that causes the RSA Software to fail to
operate in a material manner or to produce materially incorrect results and for
which there is no workaround or only a difficult workaround; or (ii) a "Level 2
Severity" error, meaning an error that produces a situation in which the RSA
Software is usable but does not function in the most convenient or expeditious
manner, and the use or value of the RSA Software suffers no material impact. RSA
will acknowledge receipt of a conforming error report within two (2) business
days and will use
5.
<PAGE> 6
its reasonable efforts to (A) provide a correction for any Level 1 Seventy error
to You as early as practicable, and (B) include a correction for any Level 2
Severity error in the next release of the RSA Software.
5.3 DISCLAIMER. EXCEPT FOR THE EXPRESS LIMITED WARRANTY PROVIDED IN THIS
SECTION 5, THE RSA SOFTWARE IS PROVIDED "AS IS" WITHOUT ANY WARRANTY WHATSOEVER.
RSA DISCLAIMS ALL WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO ANY MATTER
WHATSOEVER, INCLUDING ALL IMPLIED WARRANTIES OF MERCHANTABILITY, UNLESS FOR A
PARTICULAR PURPOSE AND NON-INFRINGEMENT OF THIRD PARTY RIGHTS. YOU SHALL NOT
(AND SHALL TAKE ALL MEASURES NECESSARY TO INSURE THAT YOUR AGENTS AND EMPLOYEES
DO NOT) MAKE OR PASS THROUGH ANY WARRANTY ON BEHALF OF RSA TO ANY DISTRIBUTOR,
END USER CUSTOMER OR OTHER THIRD PARTY.
6. YOUR ADDITIONAL OBLIGATIONS
6.1 USE OF "RSA SEAL". You agree to insert and maintain within Licensed
Products and marketing materials for the Licensed Products and Licensed Service,
in the manner described in this Section, the "RSA Secure" seal (the "RSA Seal")
depicted in the "Logo Usage Guide," which shall be delivered to You within ten
(10) days of execution of this Agreement. You shall ensure display of the RSA
Seal within any Licensed Product such that users thereof are exposed to the RSA
Seal during normal operation of such Licensed Product as follows: In a software
Licensed Product, the RSA Seal shall be featured in such Licensed Product's
startup splash screen and within any security-related dialog windows visible in
the normal operation of the product (e.g., password dialog window). In a
hardware Licensed Product, the RSA Seal shall be visible on the panel of such
Licensed Product most normally viewed by the user. You agree to include the RSA
Seal within related marketing materials including but not limited to printed and
electronic data sheets, direct mail, user documentation, product packaging and
advertisements for the Licensed Products and Licensed Service.
6.2 REPRESENTATIONS REGARDING RSA SOFTWARE. You are authorized to
represent to Distributors and End User Customers only such facts about the RSA
Software as RSA states in its published product descriptions, advertising and
promotional materials or as may be stated in other non confidential written
material furnished by RSA.
6.3 CUSTOMER SUPPORT. You agree that all support, if any, provided to
End User Customers of the Licensed Service shall be at Your expense.
6.4 LICENSE AGREEMENTS. You agree to use with each Distributor and End
User Customer receiving a Client Licensed Product a license agreement which
shall contain, at a minimum, substantially all of the limitations of rights and
the protections for RSA which are contained in Sections 2.2, 3.2, 3.3, 8, 12.6
and 12.7 of this Agreement. You agree to use Your reasonable efforts to enforce
the terms of such agreements.
6.
<PAGE> 7
7. CONFIDENTIALITY
The parties agree to treat as confidential the terms of this Agreement
and any License Fee or accounting information provided by one party to the other
in performance hereof, and the parties agree to use their reasonable efforts to
prevent disclosure thereof to any third party except with the prior written
consent of the other party, or as required by law. This obligation of
confidentiality shall extend for a period of three years following termination
or expiration of this Agreement. Notwithstanding the generality of the
foregoing, either party may disclose the existence of this Agreement and that
You are an OEM of the RSA Software and that any publicly-announced Licensed
Service uses the RSA Software.
8. LIMITATION OF LIABILITY
IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR INDIRECT,
INCIDENTAL, SPECIAL, CONSEQUENTIAL OR EXEMPLARY DAMAGES ARISING OUT OF OR
RELATED TO THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOST PROFITS, BUSINESS
INTERRUPTION OR LOSS OF BUSINESS INFORMATION, EVEN IF SUCH PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. REGARDLESS OF THE CAUSE OR FORM OF
ACTION, NEITHER PARTY'S AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS
AGREEMENT SHALL EXCEED, EXCEPT FOR RSA'S LIABILITY ARISING UNDER SECTION 9 AND
YOUR LIABILITY ARISING UNDER SECTIONS 2 AND 9 OF THIS AGREEMENT.
9. INTELLECTUAL PROPERTY INDEMNITY
9.1 DUTY TO DEFEND. RSA agrees that it shall at its own expense, defend,
or at its option settle, any action instituted against You, and pay any award or
damages assessed against You or agreed by RSA to be paid in settlement resulting
from such action, insofar as the same is based upon a claim that any RSA
Software used in accordance with the terms of this Agreement infringes any
United States copyright, United States trade secret, or a claim that RSA has no
right to license the RSA Software hereunder, provided that You give RSA: (i)
prompt notice in writing of such action; (ii) the right to control and direct
the investigation, preparation, defense and settlement of the action; and (iii)
reasonable assistance and information.
9.2 RSA OPTIONS. If such an action is made or RSA reasonably determines
in its discretion that such a claim is likely to be made, RSA shall have the
option to (i) obtain the right for you to continue use of the RSA Software; or
(ii) replace or modify the RSA Software so that it is no longer infringing but
functionally equivalent. If RSA determines that neither of these alternatives is
reasonably available, RSA shall have the option to refund the License Fees paid
by You hereunder less depreciation for use assuming straight line depreciation
over a five (5) year useful life and terminate this Agreement.
9.3 CLAIMS FOR WHICH RSA IS NOT RESPONSIBLE. Notwithstanding the
foregoing, RSA shall have no liability under this Section 9 if the alleged
infringement arises from (i) the use of other than the current unaltered release
of the RSA Software or other than in the manner specified in the relevant User
Manual; or (ii) the combination of the RSA Software with other
7.
<PAGE> 8
equipment or software not provided by RSA, if such action would have been
avoided but for such use or combination. You agree that You shall at Your
expense, defined, or at Your option settle, and hold RSA harmless from any
action instituted against RSA resulting from any infringement claim based upon
either of the foregoing.
9.4 EXCLUSIVE REMEDY. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
AGREEMENT, THE FOREGOING STATES RSA'S ENTIRE LIABILITY AND YOUR EXCLUSIVE REMEDY
FOR PROPRIETARY RIGHTS INFRINGEMENT.
10. PRESS RELEASE
10.1 JOINT PRESS RELEASE. The parties shall issue a joint press release
announcing their relationship no later than sixty (60) days following the
execution of this Agreement. This joint press release will include quotes from
senior management members (title of Vice President or higher) of each company
and will emphasize the RSA Security-enabled aspects of your Licensed Products.
Notwithstanding the foregoing, the parties agree that any press, marketing or
advertising releases or similar promotional materials, including on-line
promotion, of either party that refer to the other party or the other party's
products shall not be released or disseminated without the prior written
approval of the other party.
11. TERM AND TERMINATION
11.1 TERM. This Agreement shall be effective as of the Effective Date
and shall continue in full force and effect unless and until sooner terminated
pursuant to the terms of this Agreement.
11.2 TERMINATION. Either party shall be entitled to terminate this
Agreement at any time on written notice to the other in the event of a material
default by the other party and a failure to cure such default within a period of
thirty (30) days following receipt of written notice specifying that a default
has occurred. The parties acknowledge and agree that You may at any time delay,
interrupt or cease use of the RSA Software, but this Agreement shall continue in
full force, including any obligations to make quarterly reports. You may elect
to terminate this Agreement upon ninety (90) days' written notice and it is
expressly understood that such termination shall not discharge payment
obligations accrued as of the date of such termination, even if such obligation
is payable after the termination date, or entitle You to a refund of any amounts
previously paid to RSA.
11.3 INSOLVENCY. Upon (i) the institution of any proceedings by or
against either party seeking relief, reorganization or arrangement under any
laws relating to insolvency, which proceedings are not dismissed within sixty
(60) days; (ii) the assignment for the benefit of creditors, or the appointment
of a receiver, liquidator or trustee, of any of either party's property or
assets; or (iii) the liquidation, dissolution or winding up of either party's
business, then and in any such events this Agreement may immediately be
terminated by the other party upon written notice.
11.4 EFFECT OF TERMINATION. Upon the termination of this Agreement, you
shall cease making copies of, using or licensing the RSA Software, User Manual
and Licensed Products.
8.
<PAGE> 9
You shall destroy all copies of the RSA Software, User Manual and Licensed
Products in your possession or control and all information and documentation
provided by RSA to you.
11.5 SURVIVAL OF CERTAIN TERMS. The following provisions shall survive
any expiration or termination of this Agreement: 2.2, 3, 4.3.2, 5.3, 8, 9, 11.5
and 12.
12. MISCELLANEOUS PROVISIONS
12.1 GOVERNING LAW AND JURISDICTION. This Agreement will be governed by
and construed in accordance with the laws of the Commonwealth of Massachusetts,
irrespective of its choice of law principles. All disputes arising out of this
Agreement shall exclusively be brought in a court of competent jurisdiction in
Massachusetts. The parties agree that the United Nations Convention on Contracts
for the international Sale of Goods shall not apply to this Agreement.
12.2 ASSIGNABILITY. This Agreement is personal to you and shall not be
assignable by you, by operation of law or otherwise, without the prior written
consent of RSA. RSA may withhold its consent to the assignment of this
Agreement, at its sole discretion, if the Agreement provides for paid-up License
Fees. Any purported assignment or delegation without RSA's written consent shall
be void and of no effect.
12.3 ENTIRE AGREEMENT. This Agreement and any exhibits or attachments
hereto constitute the entire understanding and agreement of the parties hereto
with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements, representations and understandings between the
parties regarding the subject matter hereof. Any term or provision of this
Agreement may be amended, and the observance of any term of this Agreement may
be waived, only by a writing signed by the party to be bound. If any provision
of this Agreement is found to be invalid or unenforceable, such provision shall
be severed from the Agreement and the remainder of this Agreement shall be
interpreted so as best to reasonably effect the intent of the parties hereto.
12.4 REMEDIES NON-EXCLUSIVE. Except as otherwise expressly provided, any
remedy provided for in this Agreement is deemed cumulative with, and not
exclusive or, any other remedy provided for in this Agreement or otherwise
available at law or in equity. The exercise by a party or any remedy shall not
preclude the exercise by such party of any other remedy. Should suit be brought
to enforce or interpret any part of this Agreement, the prevailing party shall
be entitled to recover, as an element of the costs of suit and not as damages,
reasonable attorneys' fees to be fixed by the court (including without
limitation, costs, expenses and fees on any appeal).
12.5 NOTICES. Any notice, demand, or request with respect to this
Agreement shall be in writing and shall be effective only if it is delivered by
hand or mailed, certified or registered mail, postage prepaid, return receipt
requested, addressed to the appropriate party at its address set forth on page
1. Notice to RSA shall ad addressed to "RSA Legal Department." Such
communications shall be effective when they are received by the addressee; but
if sent by certified or registered mail in the manner set forth above, they
shall be effective not later than ten (10) days after being deposited in the
mail. Any party may change its address for such communications by giving notice
to the other party in conformity with this Section.
9.
<PAGE> 10
12.6 EXPORT COMPLIANCE AND FOREIGN RESHIPMENT LIABILITY. THE RSA
SOFTWARE AND TECHNOLOGIES WHICH ARE LICENSED UNDER THIS AGREEMENT, WHETHER OR
NOT INCORPORATED INTO LICENSED PRODUCTS, ARE SUBJECT TO UNITED STATES EXPORT
CONTROL LAWS AND REGULATIONS WHICH RESTRICT EXPORTS, REEXPORTS AND DISCLOSURES
TO FOREIGN PERSONS OF CRYPTOGRAPHIC ITEMS AND ARE ALSO SUBJECT TO CERTAIN
FOREIGN LAWS WHICH MAY RESTRICT THE EXPORT, REEXPORT, IMPORT AND/OR USE OF SUCH
ITEMS. PERFORMANCE OF THIS AGREEMENT IS EXPRESSLY MADE SUBJECT TO ANY EXPORT
LAWS, REGULATIONS, ORDERS OR OTHER RESTRICTIONS IMPOSED BY THE UNITED STATES OF
AMERICA, OR BY ANY OTHER COUNTRY OR GOVERNMENTAL ENTITY ON THE RSA SOFTWARE OR
LICENSED PRODUCTS OR OF INFORMATION RELATING TO EITHER OF THE FOREGOING.
NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT TO THE CONTRARY, YOU SHALL
NOT IMPORT, EXPORT, OR REEXPORT, DIRECTLY OR INDIRECTLY, ANY RSA SOFTWARE OR
LICENSED PRODUCTS OR INFORMATION PERTAINING THERETO TO ANY COUNTRY OR FOREIGN
PERSON TO WHICH SUCH COUNTRY, GOVERNMENT OR ANY AGENCY THEREOF REQUIRES AN
EXPORT LICENSE OR OTHER GOVERNMENTAL APPROVAL AT THE TIME OF IMPORT, EXPORT, OR
REEXPORT WITHOUT FIRST OBTAINING SUCH LICENSE OR APPROVAL. YOU UNCONDITIONALLY
ACCEPT FULL RESPONSIBILITY FOR YOUR COMPLIANCE WITH THESE REQUIREMENTS.
12.7 FEDERAL GOVERNMENT LICENSE. You and each of your Distributors shall
in all proposals and agreements with the United States government or any
contractor of the United States government identify and license the Licensed
Product, including the RSA Software incorporated therein, as follows: (i) for
acquisition by or on behalf of civilian agencies, as necessary to obtain
protection as "commercial computer software" and related documentation in
accordance with the terms of Your or such Distributor's customary license, as
specified in 48 C.F.R. 12.212 of the Federal Acquisition Regulations and its
successor regulations; or (ii) for acquisition by or on behalf of units of the
Department of Defense, as necessary to obtain protection as "commercial computer
software" as defined in 48 C.F.R. 252 227-7014(a)(l) of the Department of
Defense Federal Acquisition Regulation Supplement (DFARS) and related
documentation in accordance with the terms of your or such Distributor's
customary license, as specified in 48 C.F.R. 227 7202.1 of DFARS and its
successor regulations.
10.
<PAGE> 11
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date of the last signature below.
iPASS, INC. RSA SECURITY INC.
By: /s/ Donald C. McCauley By: /s/ Narendra Goel
-------------------------------------- --------------------------------
Printed Name: Donald C. McCauley Printed Name: Narendra Goel
---------------------------- ----------------------
Title: Vice President and Chief Financial Title: Director, Finance and OPS
Officer
----------------------------------- -----------------------------
Date: 2/29/2000 Date: 2/29/2000
------------------------------------ ------------------------------
11.
<PAGE> 12
LICENSE PRODUCT/SERVICE SCHEDULE EXHIBIT
RSA SECURITY, INC.
(SOLELY FOR THE USE WITH ANY COMBINATION
OF RSA SOFTWARE THAT INCLUDES THE SSL-C SOFTWARE)
This License Product/Service Schedule Exhibit ("LPS1") is an Exhibit to the OEM
Service Provider License Agreement between You and RSA ("Agreement").
<TABLE>
<CAPTION>
Enterprise Name ("You") Ipass Inc.
- ----------------------------------- -------------------------------------------------------------
<S> <C>
RSA Software BSAFE(R) SSL-Cv. 1.1, consisting of all algorithms,
provided by the Affiliate from its facilities in Australia
on platforms that include, but are not limited to, Windows
NT, Solaris and Linux.
Field of Use Limitation: No rights are granted with respect to the use of RSA
Software to issue digital certificates except for
supporting Licensed Products or Services and their internal
use by Your Customers. You shall not directly or
indirectly expose the "SSL-C Utility Application" (defined
below) executable program as contained in the RSA Software
within the Licensed Service. For the purpose of this Field
of Use Limitation, "SSL-C Utility Application" shall mean a
command-line utility executable program, (i.e., SSL-C.)
included in the SSL-C toolkit. Such utility application
includes the following utilities; SSL certificate, general
diagnostic, key, and cipher (the "Utilities"). The
Utilities shall be used solely for your developer's testing
and validation of the SSL functionality within the Licensed
Service and shall not be licensed or included with any
distribution of the Licensed Service.
</TABLE>
EXHIBIT NUMBER: 0200-iPA-LPS-1 AGREEMENT NUMBER: 0200-iPA-SER-2
LICENSED SERVICE. Your Service, currently known as "I-Pass Service" which
provides a global virtual network for remote internet access and network
settlement services for Internet Service Providers, corporate users and
individual users.
THREE YEAR ANNUAL LICENSE FEES: [*]
Year One: [*] payable as follows: [*] due upon execution of this LPS1
and [*] due no later than sixty (60) days after the execution date of
this LPS1.
Year Two: [*] due on or before the anniversary of the execution date of
this LPS1
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
1.
<PAGE> 13
Year Three: [*] due on or before the applicable anniversary of the
execution date of this LPS1
All Annual License Fees subsequent to Year Three: [*] per year due on or
before the applicable anniversary of the execution date of this LPS1.
In the event You terminate this License Agreement in accordance with its
terms prior to the end of the third year after execution, any and all of
the remaining Three Year Annual License Fees shall become immediately
due and payable.
SPECIAL TERMS AND CONDITIONS
1. For the purpose of this LPS, Affiliate shall mean RSA Security Australia
PTY, Ltd. a majority owned subsidiary of RSA, having a principal address
at Level 35, Riverside Centre, 123 Eagle Street, Brisbane, Queensland
4000, Australia.
2. As soon as practicable, but in no event later than [*]. You shall
incorporate the RSA Software into Your Licensed Service (the "New
Version") and make such New Version available to all of Your new
customers acquired after incorporation of the RSA Software. You shall
provide RSA with a copy of the New Version for its review and inspection
(for the sole purposes of verifying Your compliance set forth hereunder
and Your compliance with the terms and conditions of the Agreement)
prior to Your release to Your new customers but in no event later than
[*]. In the event RSA does not notify You within ten (10) business days
of any problems or concerns with the New Version relating to the
purposes set forth above, such New Version shall be deemed to be
approved by RSA.
3. As soon as practicable, but in no event later than [*]. You shall make
the New Version available to all new or existing customers and You shall
use commercially reasonable efforts to cause Your existing customers to
upgrade to the New Version.
4. You shall discontinue shipping any and all versions of the Licensed
Service containing RSA *Ref and/or SSLeay as soon as the New Version is
available, but in no event later than [*].
5. Section 1.1 of the Agreement is hereby modified by deleting such Section
in its entirety and replacing it with the following "Distributor" means
an Internet service provider, dealer or distributor in the business of
relicensing or distributing the Licensed Service to End User Customers,
directly or through one or more Distributors by virtue of authority
granted by You. Licensed Products offered by a Distributor shall bear
Your trademarks and service marks and shall not be privately labeled by
such Distributor or other parties. A Distributor shall have no right to
add to or modify any part of a Licensed Product.
6. Section 1.2 of the Agreement is hereby modified by deleting such Section
in its entirety and replacing it with the following: "End User Customer"
means a person or entity receiving the Licensed Service from You or a
Distributor for personal or internal use and primarily not for resale,
redistribution or other transfer of such Licensed Service to any other
person or entity.
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
2.
<PAGE> 14
7. Section 1.3 of the Agreement is hereby modified by deleting the third,
fourth and fifth sentence of such Section and replacing them with the
following: A Licensed Product shall consist of a component installed at
a Distributor location (a "Distributor Copy") and a component installed
at Your facilities (an "iPass Copy"). Each component of a Licensed
Product shall be capable of operating only with other components, but
Distributor Copies can operate only with an iPass Copy and not with
other Distributor Copies. The iPass Copies must be owned and operated
solely by You at Your sites.
8. Section 1.4 of the Agreement is hereby modified by deleting the last
sentence of such Section in its entirety and replacing it with the
following: "Only You or Your Distributors through You, may provide the
Licensed Service."
9. Section 1.8 of the Agreement is hereby modified by deleting such Section
in its entirety.
10. Section 2.1.1 of the Agreement is hereby modified by (a) deleting "in a
Client Licensed Product" from subsection (iii) of such Section and
replacing it with the following: "in a Distributor Copy"; (b) adding
after any reference to "employees" in subsection (iv) "or contractors";
and (c) adding the following to the end of such Section: "provided that
you agree to assume liability for any material breach caused by the acts
or omissions of Your contractors."
11. Section 2.2 of the Agreement is hereby modified by deleting "Client
Licensed Product" from the first sentence of such Section and replacing
it with the following: " Distributor Copy".
12. Section 4.3.3 of the Agreement is hereby modified by deleting "copies of
Client Licensed Products" from the first sentence of such Section and
replacing it with the following: "Distributor Copies".
13. Section 5.1 of the Agreement is hereby modified by deleting the first
sentence of such Section in its entirety and replacing it with the
following: "During the first ninety (90) days following implementation
of the RSA Software in accordance with the Licensed Product/Service
Schedule Exhibit", but in no event later than [*], RSA shall warrant
that the RSA Software will operate in material conformance to RSA's
published specifications for the RSA Software provided that You notify
RSA of such implementation date.
14. Section 6.1 of the Agreement is hereby modified by deleting "in such
Licensed Product's start-up splash screen and" from the second sentence
of such Section.
15. Section 6.4 of the Agreement is hereby modified by deleting "Client
Licensed Product" from the first sentence of such Section and replacing
it with the following: "Distributor Copy".
16. Section 7 of the Agreement is hereby modified by deleting such Section
in its entirety and replacing it with the following: "Each party agrees
to maintain all "Confidential Information" received from the other
party, both orally and in writing, in confidence and agrees not to
disclose or otherwise make available such information to any third party
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
3.
<PAGE> 15
without the prior written consent from the Disclosing Party. For the
purpose of this Agreement, "Confidential Information" shall mean the
terms of this Agreement, any License Fees or accounting information
provided by one party to the other in performance hereof and information
clearly marked confidential if given in writing or if given orally,
identified as confidential orally prior to disclosure. Each party may at
its option, reduce oral Confidential Information to writing, mark as
Confidential Information and forward such writing to the other party.
Each party further agrees to use the Confidential Information only for
the purpose of performing the Agreement. No information shall be deemed
confidential unless so marked if given in writing or, if given orally,
identified as confidential orally prior to disclosure. The Receiving
Party's obligations of non-disclosure under this Agreement shall not
apply the information which (a) is or becomes a matter of public
knowledge through no fault of or action by the Receiving Party; (b) was
rightfully in the Receiving Party's possession prior to receipt from the
Disclosing Party; (c) subsequent to disclosure, is rightfully obtained
by the Receiving Party from a third party who is lawfully in possession
of such Confidential Information without restriction; (d) is
independently developed by the Receiving Party without resort to
Confidential Information which is confidential under this Agreement, and
can so be proven by written records; or (e) is required by law or
judicial order, provided that prior written notice of such required
disclosure is furnished to the Disclosing Party as soon as practicable
in order to afford the Disclosing Party an opportunity to seek a
protective order and that if such order cannot be obtained disclosure
may be made without liability. The obligation of confidentiality shall
extend for a period of five (5) years following termination or
expiration of this Agreement. The parties agree that either party may
disclose the existence of this Agreement, and that You are an OEM of the
RSA Software and that any publicly announced Licensed Service uses the
RSA Software. Notwithstanding the any of the foregoing, in the event a
Disclosing Party discloses a trade secret to the other party, the
Confidential provisions set forth in this Section shall survive the
Agreement in perpetuity provided that the trade secret is clearly marked
confidential if given in writing and forwarded to the other party within
thirty (30) days following disclosure.
17. Section 9.1 of the Agreement is hereby modified by (a) deleting "and pay
any award" from the first sentence of such Section and replacing it with
the following: "and pay in full any award"; (b) adding "United States
Patent." After "United States Copyright" in the first sentence of such
Section; (c) adding "full" before "settlement" in the first sentence of
such Section; and (d) adding "upon RSA's reasonable request and RSA's
reasonable expense" to the end of subsection (iii).
18. Section 9.3 of the Agreement is hereby modified by adding "provided that
RSA gives You, (i) prompt notice in writing of such action; (ii) the
right to control and direct the investigation, preparation, defense and
settlement of the action; and (iii) reasonable assistance and
information upon Your reasonable request and Your reasonable expense."
19. Section 10 of the Agreement is hereby modified by deleting such Section
in its entirety.
20. Section 11.1 is hereby modified by deleting such Section in its entirety
and replacing it with the following: "This Agreement shall be effective
as of the Effective Date and shall
4.
<PAGE> 16
continue in full force and effect for a period of three (3) years, and
shall automatically renew for each successive period unless and until
sooner terminated pursuant to the terms of this Agreement."
21. Section 11.2 of the Agreement is hereby amended to grant You the right
to terminate the Agreement upon sixty (60) days written notice to RSA
prior to the applicable anniversary of the Effective Date.
22. Section 11.4 of the Agreement is hereby modified by deleting such
Section in its entirety and replacing it with the following: "Upon
termination of this Agreement, You shall cease making copies of and
distributing the RSA Software, User Manual and Licensed Products, and
shall within one hundred eighty (180) days following termination, cease
using or permitting use of Licensed Products and at such time destroy
all copies of the RSA Software, User Manuals, and Licensed Products in
Your possession or control and all information and documentation
provided by RSA to You."
23. Section 11.5 of the Agreement is hereby modified by deleting such
Section in its entirety and replacing it with the following: "The
following provisions shall survive any expiration or termination of this
Agreement: 2.2, 3, 4.3.2, 5.3. 8, 9, 11.5, 12 and to the extent
necessary."
24. Section 12.1 of the Agreement is hereby modified by deleting the second
sentence of such Section in its entirety.
25. Section 12.2 of the Agreement is hereby modified by adding "which will
not be unreasonably withheld or delayed" after "without the prior
written consent of RSA" in the first sentence of such Section. Section
12.2 is further modified by adding the following to the end of such
Section: "Notwithstanding any of the foregoing, You shall not be
obligated to obtain RSA's consent for an assignment pertaining to a
change of state incorporation."
Note: By signing this agreement You represent that Services hereunder are being
published and distributed (physically or via remote access) for a consideration
to third parties. Any internal usage will be reported, as needed, directly by
You, to the appropriate sales tax agency.
IPASS, INC. RSA SECURITY INC.
By: /s/ Donald C. McCauley By: /s/ Narendra Goel
-------------------------------------- --------------------------------
Printed Name: Donald C. McCauley Printed Name: Narendra Goel
---------------------------- ----------------------
Title: Vice President & Chief Financial Title: Director, Finance and OPS
Officer
----------------------------------- -----------------------------
Date: February 28, 2000 Date: 2/29/2000
------------------------------------ ------------------------------
5.
<PAGE> 17
SUPPORT AGREEMENT
RSA SECURITY INC.
This SUPPORT AGREEMENT ("Support Agreement") is entered into by and
between RSA Security Inc., a Delaware corporation ("RSA"), having a principal
address at 2855 Campus Drive, Suite 400, San Mateo, CA 94403-2507, and:
ENTERPRISE NAME ("YOU"): iPass Inc. JURISDICTION OF INCORPORATION: California
STREET ADDRESS: 3800 Bridge Parkway STATE & ZIP CODE: California 94065
CITY: Redwood Shores
ENTERPRISE LEGAL CONTACT (NAME & TITLE):
MAINTENANCE AND SUPPORT PROGRAM ELECTED Standard [X] Premier [ ]
INITIAL SUPPORT FEE: [*] for a period of twelve (12) months from the Effective
Date of this Support Agreement.
This Support Agreement provides support and maintenance services for the RSA
Software licensed under the Exhibit. The Effective Date of this Support
Agreement shall be contingent upon the execution of License/Product Schedule
Exhibit 0200-iPA-LPS-1 (the "Exhibit") and payment of the Initial Support Fee of
[*]. In the event You elect to renew this Support Agreement for subsequent
twelve (12) month terms, the Support Fee for year two shall be [*] and the
Support Fee for year three shall be [*]. Thereafter, subsequent renewals of this
Support Agreement shall be set at the then current rate for standard maintenance
and support in effect at the time of renewal. Fees for all renewal terms shall
be due on or before the applicable anniversary of the Effective Date of this
Support Agreement.
1. DEFINITIONS
All capitalized terms used and not defined herein shall have the meanings set
forth in the License Agreement or the following meanings:
1.1 "LICENSE AGREEMENT" means License Agreement Number 0200-iPA-OEM-2
between RSA and You.
1.2 "RSA SOFTWARE" means RSA proprietary software identified as RSA
Software on page 1 of the License Agreement.
2. MAINTENANCE AND SUPPORT SERVICES
2.1 GENERAL. This Support Agreement sets forth the terms under which RSA
will provide support to You for the RSA Software licensed to You for the
Licensed Products, as set
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
1.
<PAGE> 18
forth under the License Agreement. The use of and license to any Fixes and
Updates provided to you hereunder shall be governed by the terms of the License
Agreement.
2.2 SUPPORT AND MAINTENANCE. RSA agrees to provide the maintenance and
support specified in this Support Agreement and You agree to pay RSA's
then-current annual support fee ("Support Fee").
2.3 SUPPORT PROVIDED BY RSA. For the annual period commencing on the
Effective Date hereof, and for future annual periods for which You have paid the
Support Fee, RSA will provide You with the following services in accordance with
the program You have elected above:
2.3.1 SUPPORT UNDER STANDARD PROGRAM. In the event You have elected
the Standard program, RSA will provide telephone support to You from 6:00 a.m.
to 5:00 p.m. (Pacific Time) Monday through Friday, excluding locally observed
holidays. Upon the receipt of a request for support services, RSA shall respond
within one (1) business day from the time of the request. RSA shall provide the
support specified in this Section to Your employees responsible for developing
and maintaining the Licensed Products licensed under the License Agreement and
providing support to End User Customers thereof. No more than two (2) of Your
employees may obtain such support from RSA at any one time. Upon RSA's request,
You will provide a list with the names of the employees designated to receive
support from RSA. You may provide on-site support reasonably determined to be
necessary by RSA at Your location specified on page 1 hereof.
2.3.2 SUPPORT UNDER PREMIER PROGRAM. In the event that You have
elected the Premier program, RSA will provide telephone support to You 24 hours
a day, 7 days a week. Upon the receipt for a request for support services, RSA
shall respond within two hours from the time of the request. RSA shall provide
the support specified in this Section to Your employees responsible for
developing and maintaining the Licensed Products licensed under the License
Agreement and providing support to End User Customers thereof. No more than five
(5) of Your employees may obtain such support from RSA at any one time. Upon
RSA's request, You will provide a list with the names of the employees
designated to receive support from RSA. You may change the names on the list at
any time by providing written notice to RSA. Upon Your request, RSA may provide
on-site support reasonably determined to be necessary by RSA at Your location
specified on page 1 hereof.
2.4 ERROR CORRECTION. In the event You discover an error in the RSA
Software which causes the RSA Software not to operate in material conformance to
RSA's published specifications therefor, You shall submit to RSA a written
report describing such error in sufficient detail to permit RSA to reproduce
such error. Upon receipt of any such written report, RSA will use its reasonable
efforts to correct such an error or to provide a software patch or bypass around
such an error (collectively, "Fixes") as early as practicable. All Fixes
provided to You shall constitute RSA Software under the License Agreement and
shall be governed by the terms thereof. Under no circumstances does RSA warrant
or represent all errors can or will be corrected. Furthermore, RSA shall not be
responsible for correcting any error if You fail to incorporate in Your Licensed
Product any Fixes or Update that RSA has provided to You.
2.
<PAGE> 19
2.5 UPDATES. RSA will from time to time offer You, at no additional
cost, Updates of the RSA Software during the term of this Support Agreement. You
understand, however, that RSA is not obligated to provide any Update. Absent any
restriction to Your right to use the algorithms contained in RSA Software, as
set forth in the applicable License Agreement in force at the time of execution
of this Support Agreement. Your license rights to any Updates shall also extend
to any new algorithms contained in such Updates. Any Updates acquired by You
shall be governed by all of the terms and provisions of the License Agreement.
3. MAINTENANCE AND SUPPORT FEES
3.1 SUPPORT FEES. In consideration of RSA's providing the maintenance
and support services described herein, You agree to pay RSA the initial Support
Fee set forth on the first page hereof. Such amount shall be payable for the
first year upon the execution of this Support Agreement, and for each subsequent
year in advance of the commencement of such year. The Support Fee may be
modified by RSA for each renewal term by written notice to You at least ninety
(90) days prior to the end of the then-current term. If You elect not to renew
this Support Agreement for successive terms (as provided in Section 6.1 below),
You may re-enroll only upon payment of the annual Support Fee for the coming
year and for all Support Fees that would have been paid had You not ceased
maintenance and support.
3.2 ADDITIONAL CHARGES. In the event RSA is required to take actions to
correct a difficulty or defect which is traced to Your errors, modifications,
enhancements, software or hardware, then You shall pay to RSA its time and
materials charges at RSA's rates then in effect. In the event that you have
requested RSA's personnel to travel to perform maintenance or on-site support,
You shall reimburse RSA for any reasonable out-of-pocket expenses incurred,
including travel to and from Your sites, lodging, meals and shipping, as may be
necessary in connection with duties performed under this Section 2 by RSA.
3.3 TAXES. All taxes, duties, fees and other governmental charges of any
kind (including sales and use taxes, but excluding taxes based on the gross
revenues or net income of RSA) which are imposed by or under the authority of
any government or any political subdivision thereof on the Support Fees or any
aspect of this Support Agreement shall be borne by You and shall not be
considered a part of, a deduction from or an offset against Support Fees.
3.4 TERMS OF PAYMENT. Support Fees due RSA hereunder shall be paid by
You to the attention of the Software Licensing Department at RSA's address set
forth above upon execution and, in the case of renewal terms, prior to the each
anniversary thereof. A late payment penalty on any Maintenance Fees not paid
when due shall be assessed at the rate of one percent (1%) per thirty (30) days.
In no event shall Support Fees paid be refundable.
3.5 U.S. CURRENCY. All payments hereunder shall be made in lawful United
States currency.
4. CONFIDENTIALITY
The parties agree that all obligations and conditions respecting
confidentiality, use of the Source Code (if licensed to You) and publicity in
the License Agreement shall apply to the parties' performance of this Support
Agreement.
3.
<PAGE> 20
5. USE LIMITATIONS; TITLE; INTELLECTUAL PROPERTY INDEMNITY; LIMITATION OF
LIABILITY
Any and all Upgrades and Fixes provided to You pursuant to this Support
Agreement shall constitute RSA Software under the License Agreement. As such the
parties' respective interests and obligations relating to the RSA Software,
including but not limited to license and ownership rights thereto, use
limitations (if any), intellectual property indemnity and limitation of
liability, shall be governed by the terms of the License Agreement.
6. TERM AND TERMINATION
6.1 TERM. This Support Agreement shall commence on the Effective Date
hereof and shall remain in full force and effect for an initial period of one
(1) year, unless sooner terminated in accordance with this Support Agreement.
Upon expiration of the initial period and each successive period, this Support
Agreement shall automatically renew for an additional one (1) year period,
unless either party has notified the other of its intent to terminate as set
forth in Section 6.2.3 herein.
6.2 TERMINATION.
6.2.1 Either party shall be entitled to terminate this Support
Agreement at any time on written notice to the other in the event of a material
default by the other party of this Support Agreement and a failure to cure such
default within a period of thirty (30) days following receipt of written notice
specifying that a default has occurred.
6.2.2 This Support Agreement shall automatically terminate in the
event that the License Agreement is terminated in accordance with its terms.
6.2.3 This Support Agreement may also be terminated by You for any
or no reason by providing written notice of such intent at least ninety (90)
days prior to the end of the then-current term. RSA may cease to offer support
and maintenance for future maintenance terms by notice delivered to You ninety
(90) days or more before the end of the then-current maintenance term.
6.2.4 Upon (i) the institution of any proceedings by or against
either party seeking relief, reorganization or arrangement under any laws
relating to insolvency, which proceedings are not dismissed within sixty (60)
days; (ii) the assignment for the benefit of creditors, or upon the appointment
of a receiver, liquidator or trustee, of any of either party's property or
assets; or (iii) the liquidation, dissolution or winding up of either party's
business, then and in any such events this Support Agreement may immediately be
terminated by either party upon written notice.
6.3 SURVIVAL OF CERTAIN TERMS. The following provisions shall survive
any expiration or termination of this Support Agreement: Section 3.1, 4, 5, 6
and 7.
4.
<PAGE> 21
7. MISCELLANEOUS PROVISIONS
This Support Agreement is not an amendment to the License Agreement, but instead
is a separate binding agreement which incorporates certain terms of the License
Agreement for the purposes of brevity and assured consistency. This Agreement
incorporates by this reference the "Miscellaneous Provisions" Section of the
License Agreement in its entirety.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date of
the later signature below.
IPASS, INC. RSA SECURITY INC.
By: /s/ Donald C. McCauley By: /s/ Narendra Goel
-------------------------------------- --------------------------------
Printed Name: Donald C. McCauley Printed Name: Narendra Goel
---------------------------- ----------------------
Title: VP & CFO Title: Director, Finance & OPS
----------------------------------- -----------------------------
Date: 2/28/2000 Date: 2/29/2000
------------------------------------ ------------------------------
5.
