<PAGE>
Exhibit 10.27
SHORELINE TECHNOLOGY PARK
MOUNTAIN VIEW, CALIFORNIA
OFFICE LEASE AGREEMENT
BETWEEN
EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a Delaware limited liability company
("LANDLORD")
AND
E-STAMP CORPORATION, a Delaware corporation
("TENANT")
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
I. Basic Lease Information......................................... 1
II. Lease Grant..................................................... 4
III. Possession...................................................... 4
IV. Rent............................................................ 5
V. Compliance with Laws; Use....................................... 10
VI. Security Deposit................................................ 11
VII. Services........................................................ 11
VIII. Leasehold Improvements.......................................... 12
IX. Repairs, Maintenance and Alterations............................ 12
X. Use of Utility Services by Tenant............................... 14
XI. Entry by Landlord............................................... 15
XII. Assignment and Subletting....................................... 16
XIII. Liens........................................................... 18
XIV. Indemnity and Waiver of Claims.................................. 18
XV. Insurance....................................................... 19
XVI. Subrogation..................................................... 19
XVII. Casualty Damage................................................. 20
XVIII. Condemnation.................................................... 21
XIX. Events of Default............................................... 22
XX. Remedies........................................................ 22
XXI. Limitation of Liability......................................... 24
XXII. No Waiver....................................................... 24
XXIII. Quiet Enjoyment................................................. 25
XXIV. Relocation...................................................... 25
XXV. Holding Over.................................................... 25
XXVI. Subordination to Mortgages; Estoppel Certificate................ 25
XXVII. Attorneys' Fees................................................. 26
XXVIII. Notice.......................................................... 26
XXIX. Excepted Rights................................................. 27
XXX. Surrender of Premises........................................... 27
XXXI. Miscellaneous................................................... 27
XXXII. Entire Agreement................................................ 30
</TABLE>
i
<PAGE>
OFFICE LEASE AGREEMENT
THIS OFFICE LEASE AGREEMENT (the "Lease") is made and entered into as of
the ____ day of ___________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK,
L.L.C., a Delaware limited liability company ("Landlord") and E-STAMP
CORPORATION, a Delaware corporation ("Tenant").
I. Basic Lease Information.
A. "Building" shall mean the building located at 2051 Stierlin Court,
Mountain View, California.
B. "Premises" shall mean the area shown on Exhibit A-1 to this Lease.
The "Rentable Square Footage of the Premises" is deemed to be 92,256
square feet.
C. "Rentable Square Footage of the Building" is deemed to be 92,256
square feet. Landlord and Tenant stipulate that the Premises include
all of the floors in their entirety, all corridors and restroom
facilities located in the Building and accordingly, all such full
floors shall be considered part of the Premises. Landlord and Tenant
further stipulate and agree that the Rentable Square Footage of the
Building and the Rentable Square Footage of the Premises are correct
and shall not be remeasured.
D. "Base Rent":
--------------------------------------------------------------------
Annual Rate Annual Monthly
Period Per Square Foot Base Rent Base Rent
--------------------------------------------------------------------
3/1/00 - 2/28/01 $37.80 $3,487,276.80 $290,606.40
--------------------------------------------------------------------
3/1/01 - 2/28/02 $39.00 $3,597,984.00 $299,832.00
--------------------------------------------------------------------
3/1/02 - 2/28/03 $40.20 $3,708,691.20 $309,057.60
--------------------------------------------------------------------
3/1/03 - 2/29/04 $41.40 $3,819,398.40 $318,283.20
--------------------------------------------------------------------
3/1/04 - 2/28/05 $42.60 $3,930,105.60 $327,508.80
--------------------------------------------------------------------
3/1/05 - 2/28/06 $43.80 $4,040,812.80 $336,734.40
--------------------------------------------------------------------
3/1/06 - 2/28/07 $45.00 $4,151,520.00 $345,960.00
--------------------------------------------------------------------
Notwithstanding the above schedule of Base Rent to the contrary, as
long as Tenant is not in default, after the expiration of any
applicable notice and cure periods, Tenant shall be entitled to (i) an
abatement of 1 full calendar month of Base Rent in the amount of
$290,606.40 (the "Abated Base Rent") for the 1/st/ full calendar month
of the Term (the "Abatement Period") and (ii) an abatement of 1 full
calendar month of Expenses and Taxes (as hereinafter defined) (the
"Abated Expenses and Taxes") for the Abatement Period. In the event
Tenant defaults, after the expiration of any applicable notice and
cure periods, at any time during the Term, all Abated Base Rent and
Abated Expenses and Taxes shall
1
<PAGE>
immediately become due and payable. The payment by Tenant of the
Abated Base Rent and Abated Expenses and Taxes in the event of a
default, after the expiration of any applicable notice and cure
periods, shall not limit or affect any of Landlord's other rights,
pursuant to this Lease or at law or in equity. During the Abatement
Period, only Base Rent and Expenses and Taxes shall be abated, and all
other Additional Rent and other costs and charges specified in this
Lease shall remain as due and payable pursuant to the provisions of
this Lease. In the event that Tenant substantially completes the
Initial Alterations (as defined in Exhibit D of this Lease) prior to
the last day of the Abatement Period, Tenant shall commence paying
Base Rent in accordance with the above Base Rent schedule and Expenses
and Taxes in accordance with Article IV of this Lease commencing with
the day after the date the Initial Alterations are substantially
completed. For purposes of this paragraph, the Initial Alterations
shall be deemed substantially completed on the date that, in
Landlord's reasonable judgment, all Initial Alterations have been
performed, other than any details of construction, mechanical
adjustment or any other similar matter, the noncompletion of which
does not materially interfere with Tenant's use of the Premises.
E. "Tenant's Pro Rata Share": 100%.
F. "Term": A period of 85 months. The Term shall commence on the later
of March 1, 2000 and the date by which Landlord has delivered
possession of the Premises to Tenant in the condition required herein
(the "Commencement Date") and, unless terminated early in accordance
with this Lease, end on February 28, 2007 (the "Termination Date").
Landlord and Tenant acknowledge that as of the date of this Lease, it
is currently anticipated that the Commencement Date shall be March 1,
2000, and Landlord shall use its reasonable efforts to tender
possession of the Premises to Tenant by March 1, 2000. In the event
the Commencement Date is not March 1, 2000, Landlord and Tenant shall
enter into a commencement letter agreement in the form attached as
Exhibit C setting forth the actual Commencement Date.
G. Tenant allowance(s): $5.00 per rentable square foot of the Premises
as more fully described on Exhibit D of this Lease.
H. "Security Deposit": $1,200,000.00. The Security Deposit shall be in
the form of an irrevocable letter of credit (the "Letter of Credit"),
as more fully described in Article VI of this Lease.
I. "Guarantor(s)": As of the date of this Lease, there are no Guarantors.
J. "Broker(s)": Cornish & Carey Commercial representing Landlord and
CRESA Partners LLC representing Tenant.
K. "Permitted Use": Office, research and development, manufacturing,
storage and other legal uses as permitted by local zoning laws
applicable to the Premises and otherwise permitted by the Governing
Documents (as that term is defined in Article XXXI.M. below).
2
<PAGE>
L. "Notice Addresses":
Tenant:
On and after the Commencement Date, notices shall be sent to Tenant at
the Premises to the attention of General Counsel and to Facilities
Manager. Prior to the Commencement Date, notices shall be sent to
Tenant at the following address:
2855 Campus Drive
San Mateo, California 94403
Phone #: (650) 554-8454
Fax #: (650) 554-8455
<TABLE>
<CAPTION>
Landlord: With a copy to:
<S> <C>
EOP-SHORELINE TECHNOLOGY PARK, L.L.C. Equity Office Properties
c/o Equity Office Properties Trust Two North Riverside Plaza
4 Palo Alto Square Suite 2200
3000 El Camino Real, Suite 130 Chicago, Illinois 60606
Palo Alto, California 94306-2122 Attention: Regional Counsel - Pacific Region
Attention: Building Manager
</TABLE>
Rent (defined in Section IV.A) is payable to the order of Equity
Office Properties at the following address: EOP Operating Limited
Partnership, as agent for EOP-Shoreline Technology Park, Dept. #8824,
Los Angeles, California 90084-8824.
M. "Business Day(s)" are Monday through Friday of each week, exclusive of
New Year's Day, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day ("Holidays"). Landlord may
designate additional Holidays, provided that the additional Holidays
are commonly recognized by other office buildings in the area where
the Building is located.
N. "Landlord Work" means the work, if any, that Landlord is obligated to
perform in the Premises pursuant to a separate work letter agreement
(the "Work Letter"), if any, attached as Exhibit D. If a Work Letter
is not attached to this Lease or if an attached Work Letter does not
require Landlord to perform any work, the occurrence of the
Commencement Date shall not be conditioned upon the performance of
work by Landlord and, accordingly, Section III.A. shall not be
applicable to the determination of the Commencement Date.
O. "Law(s)" means all applicable statutes, codes, ordinances, orders,
rules and regulations of any municipal or governmental entity.
P. "Normal Business Hours" for the Building are 8:00 a.m. to 5:00 p.m. on
Business Days.
3
<PAGE>
Q. "Property" means the Building and the parcel(s) of land on which it is
located and the Building's parking area and other improvements serving
the Building, if any, and the parcel(s) of land on which they are
located.
R. "Project" shall mean the development located on approximately 51.83
acres commonly described as Shoreline Technology Park, which includes
the Building, the Property, as well as other buildings and property as
outlined on Exhibit A-2 attached hereto and incorporated herein.
S. "Rentable Square Footage of the Project" is deemed to be 726,508
square feet.
II. Lease Grant.
Landlord leases the Premises to Tenant and Tenant leases the Premises from
Landlord, together with the right in common with others to use any other
portions of the Project that are designated by Landlord for the common use of
tenants and others, such as sidewalks, unreserved parking areas, common
corridors, elevator foyers, restrooms, vending areas, lobby areas, artificial
lakes, walkways, water amenities, landscaping, plaza, roads, driveways, and
recreation areas (collectively, the "Common Areas"), including but not limited
to that certain recreation area (the "Recreational Area") which is maintained by
Landlord in the location and configuration shown on Exhibit A-3 attached hereto.
Notwithstanding the foregoing to the contrary, Tenant's right to use the
Recreational Area shall be subject to the right of the City of Mountain View
("City") to require that a portion of the Recreational Area be paved and used
for parking purposes at a time to be determined at the discretion of the City.
The area to be used for parking purposes is indicated as "Potential Parking
Area" on Exhibit A-3. If the City requires the parking, Tenant shall have the
non-exclusive right to use the parking spaces created thereby. Landlord agrees
that except as may be required by applicable Law or in the event of an
emergency, Landlord shall not knowingly alter the Common Areas so as to deprive
Tenant of reasonable access to the Premises from a public street or right of
way.
III. Possession.
A. INTENTIONALLY OMITTED.
B. Subject to Landlord's obligations under Section IX.B., and Landlord's
obligation to tender the Premises to Tenant in a "broom clean"
condition, the Premises are accepted by Tenant in "as is" condition
and configuration. By taking possession of the Premises, Tenant agrees
that the Premises are in good order and satisfactory condition, and
that there are no representations or warranties by Landlord regarding
the condition of the Premises or the Building; provided, however,
nothing herein shall be deemed a waiver of Landlord's delivery
requirements hereunder. Notwithstanding anything to the contrary
contained in this Lease, Landlord shall not be obligated to tender
possession of the Premises or other space leased by Tenant from time
to time hereunder that, on the date possession is delivered, is
occupied by a tenant or other occupant, nor shall Landlord have any
other obligations to Tenant under this Lease with respect to such
space until the date Landlord: (i) recaptures such space from such
existing tenant or occupant; and (2) regains the legal right to
possession thereof. This Lease shall not be affected by any such
failure to deliver possession and Tenant shall have no claim for
damages against Landlord as a result thereof, all of which are hereby
waived and released by Tenant. If Landlord is delayed delivering
4
<PAGE>
possession of the Premises or any other space due to the holdover or
unlawful possession of such space by any party, Landlord shall use
commercially reasonable efforts to obtain possession of the space
(including, if appropriate, commencing and prosecuting an unlawful
detainer proceeding against any holdover tenant), in which event, the
Commencement Date shall be postponed until the date Landlord delivers
possession of the Premises to Tenant free from occupancy by any party,
and the Termination Date, at the option of Landlord, may be postponed
by an equal number of days. Notwithstanding the foregoing, if the
Commencement Date does not occur by July 31, 2000 (the "Outside
Completion Date"), Tenant, as its sole remedy, may terminate this
Lease by giving Landlord written notice of termination on or before
the earlier to occur of: (i) 10 Business Days after the Outside
Completion Date; and (ii) the Commencement Date. In such event, this
Lease shall be deemed null and void and of no further force and effect
and Landlord shall promptly refund any Prepaid Rental and Security
Deposit previously advanced by Tenant under this Lease and, except
with respect to any previous defaults by Tenant beyond any applicable
notice and cure period under the Work Letter or this Lease, the
parties hereto shall have no further responsibilities or obligations
to each other with respect to this Lease. Landlord and Tenant
acknowledge and agree that the Outside Completion Date shall be
postponed by the number of days the Commencement Date is delayed due
to delays caused by Tenant. Notwithstanding anything herein to the
contrary, if Landlord determines that it will be unable to cause the
Commencement Date to occur by the Outside Completion Date, Landlord
shall have the right to immediately provide Tenant with written notice
(the "Outside Extension Notice") of such inability, which Outside
Extension Notice shall set forth the date on which Landlord reasonably
believes that the Commencement Date will occur. Upon receipt of the
Outside Extension Notice, Tenant shall have the right to terminate
this Lease by providing written notice of termination to Landlord
within 5 Business Days after the date of the Outside Extension Notice.
In the event that Tenant does not terminate this Lease within such 5
Business Day period, the Outside Completion Date shall automatically
be amended to be the date set forth in Landlord's Outside Extension
Notice.
C. If Tenant takes possession of the Premises before the Commencement
Date, such possession shall be subject to the terms and conditions of
this Lease and Tenant shall pay Rent (defined in Section IV.A.) to
Landlord for each day of possession before the Commencement Date.
However, except for the cost of services requested by Tenant (e.g.
electricity), Tenant shall not be required to pay Rent for any days of
possession before the Commencement Date during which Tenant, with the
approval of Landlord, is in possession of the Premises for the sole
purpose of performing improvements or installing furniture, equipment
or other personal property.
IV. Rent.
A. Payments. As consideration for this Lease, Tenant shall pay Landlord,
--------
without any setoff or deduction, the total amount of Base Rent and
Additional Rent due for the Term. "Additional Rent" means all sums
(exclusive of Base Rent) that Tenant is required to pay Landlord.
Additional Rent and Base Rent are sometimes collectively referred to
as "Rent". Tenant shall pay and be liable for all
5
<PAGE>
rental, sales and use taxes (but excluding income taxes), if any,
imposed upon or measured by Rent under applicable Law. Base Rent and
recurring monthly charges of Additional Rent shall be due and payable
in advance on the first day of each calendar month without notice or
demand, provided that the installment of Base Rent for the second full
calendar month of the Term shall be payable upon the execution of this
Lease by Tenant. All other items of Rent shall be due and payable by
Tenant on or before 30 days after billing by Landlord. All payments of
Rent shall be by good and sufficient check or by other means (such as
automatic debit or electronic transfer) acceptable to Landlord. If
Tenant fails to pay any item or installment of Rent within 5 days of
when due, Tenant shall pay Landlord an administration fee equal to 5%
of the past due Rent, provided that Tenant shall be entitled to a
grace period of 5 days after written notice by Landlord of a
delinquency for the first 2 late payments of Rent in a given calendar
year. If the Term commences on a day other than the first day of a
calendar month or terminates on a day other than the last day of a
calendar month, the monthly Base Rent and Tenant's Pro Rata Share of
Expenses (defined in Section IV.C.) and Taxes (defined in Section
IV.D.) for the month shall be prorated based on the number of days in
such calendar month. Landlord's acceptance of less than the correct
amount of Rent shall be considered a payment on account of the
earliest Rent due. No endorsement or statement on a check or letter
accompanying a check or payment shall be considered an accord and
satisfaction, and either party may accept the check or payment without
prejudice to that party's right to recover the balance or pursue other
available remedies. Tenant's covenant to pay Rent is independent of
every other covenant in this Lease.
B. Payment of Tenant's Pro Rata Share of Expenses and Taxes. Tenant shall
---------------------------------------------------------
pay Tenant's Pro Rata Share of the total amount of Expenses (defined
in Section IV.C.) and Taxes (defined in Section IV.D) for each
calendar year during the Term. Landlord shall provide Tenant with a
good faith estimate of the total amount of Expenses and Taxes for each
calendar year during the Term. On or before the first day of each
month, Tenant shall pay to Landlord a monthly installment equal to
one-twelfth of Tenant's Pro Rata Share of Landlord's estimate of the
total amount of Expenses and Taxes. If Landlord determines that its
good faith estimate was incorrect by a material amount, Landlord may
provide Tenant with a revised estimate. After its receipt of the
revised estimate, Tenant's monthly payments shall be based upon the
revised estimate. If Landlord does not provide Tenant with an estimate
of the total amount of Expenses and Taxes by January 1 of a calendar
year, Tenant shall continue to pay monthly installments based on the
previous year's estimate until Landlord provides Tenant with the new
estimate. Upon delivery of the new estimate, an adjustment shall be
made for any month for which Tenant paid monthly installments based on
the previous year's estimate. Tenant shall pay Landlord the amount of
any underpayment within 30 days after receipt of the new estimate. Any
overpayment shall be refunded to Tenant within 30 days or credited
against the next due future installment(s) of Additional Rent.
As soon as is practical following the end of each calendar year,
Landlord shall furnish Tenant with a statement of the actual amount of
Expenses and Taxes for the prior calendar year and Tenant's Pro Rata
Share of the actual amount of Expenses and Taxes for the prior
calendar year. If the estimated amount of
6
<PAGE>
Expenses and Taxes for the prior calendar year is more than the actual
amount of Expenses and Taxes for the prior calendar year, Landlord
shall apply any overpayment by Tenant against Rent due or next
becoming due, provided if the Term expires before the determination of
the overpayment, Landlord shall refund any overpayment to Tenant after
first deducting the amount of Rent due. If the estimated amount of
Expenses and Taxes for the prior calendar year is less than the actual
amount of Expenses and Taxes for such prior year, Tenant shall pay
Landlord, within 30 days after its receipt of the statement of
Expenses and Taxes, any underpayment for the prior calendar year.
C. Expenses Defined. "Expenses" means the sum of (y) 100% of all direct
----------------
and indirect costs and expenses incurred in each calendar year in
connection with operating, maintaining, repairing, managing and owning
the Premises, the Building, the Property, and the parking structure(s)
or parking lot(s) predominantly serving the Building, and (z) the
Building's allocable share of the direct and indirect costs of
operating and maintaining the Common Areas of the Project, the
Building's allocable share of all costs, fees, expenses or other
amounts payable by Landlord to the Association, if any, and the
Building's allocable share of all fees payable to the company or the
Association, if applicable, managing the parking areas within the
Project, including, without limitation, the following:
1. Labor costs, including, wages, salaries, social security and
employment taxes, medical and other types of insurance, uniforms,
training, and retirement and pension plans.
2. Management fees, the cost of equipping and maintaining a
management office, accounting and bookkeeping services, legal
fees not attributable to leasing or collection activity, and
other administrative costs. Landlord, by itself or through an
affiliate, shall have the right to directly perform or provide
any services under this Lease (including management services),
provided that the cost of any such services shall not exceed the
cost that would have been incurred had Landlord entered into an
arms-length contract for such services with an unaffiliated
entity of comparable skill and experience.
3. The cost of services, including amounts paid to service providers
and the rental and purchase cost of parts, supplies, tools and
equipment.
4. Premiums and deductibles paid by Landlord for insurance,
including workers compensation, fire and extended coverage,
earthquake, general liability, rental loss, elevator, boiler and
other insurance customarily carried from time to time by owners
of comparable office buildings.
5. Electrical Costs (defined below) and charges for water, gas,
steam and sewer, but excluding those charges applicable to any
non-Common Area building in the Project other than the Building
or any building into which Tenant may subsequently expand.
"Electrical Costs" means: (a) charges paid by Landlord for
electricity; (b) costs incurred in connection with an energy
management program for the Property and/or Project; and (c) if
and to the extent permitted by Law, a fee for the services
provided by
7
<PAGE>
Landlord in connection with the selection of utility companies
and the negotiation and administration of contracts for
electricity, provided that such fee shall not exceed 50% of any
savings obtained by Landlord.
6. The amortized cost of capital improvements (as distinguished from
replacement parts or components installed in the ordinary course
of business) made to the Building and/or the Common Areas which
are: (a) performed primarily to reduce operating expense costs or
otherwise improve the operating efficiency of the Building and/or
the Common Areas; or (b) required to comply with any Laws that
are enacted, or first interpreted to apply to the Building and/or
the Common Areas, after the date of this Lease. The cost of
capital improvements shall be amortized by Landlord over the
lesser of the Payback Period (defined below) or 10 years. The
amortized cost of capital improvements may, at Landlord's option,
include actual or imputed interest at the rate that Landlord
would reasonably be required to pay to finance the cost of the
capital improvement. "Payback Period" means the reasonably
estimated period of time that it takes for the cost savings
resulting from a capital improvement to equal the total cost of
the capital improvement.
If Landlord incurs Expenses for the Project together with one or more
other buildings or properties, whether pursuant to a reciprocal
easement agreement, common area agreement or otherwise, the shared
costs and expenses shall be equitably prorated and apportioned between
the Project and the other buildings or properties. Expenses shall not
include: the cost of capital improvements (except as set forth in
subparagraph (6) above); depreciation; interest (except as provided
above for the amortization of capital improvements); principal or
other payments of mortgage and other non-operating debts of Landlord;
the cost of repairs or other work to the extent Landlord is reimbursed
by insurance or condemnation proceeds; costs in connection with
leasing space in the Building, including brokerage commissions; lease
concessions, including rental abatements and construction allowances,
granted to specific tenants; costs incurred in connection with the
sale, financing or refinancing of the Building; fines, interest and
penalties incurred due to the late payment of Taxes (defined in
Section IV.D) or Expenses; organizational expenses associated with the
creation and operation of the entity which constitutes Landlord; any
penalties or damages that Landlord pays to Tenant under this Lease or
to other tenants in the Project under their respective leases; any
fines or penalties incurred due to violations by Landlord of any law,
order, rule or regulations of any governmental authority except where
such fines or penalties are incurred by Landlord for violations of any
such law, order, rule or regulation that is ultimately determined to
be invalid, or inapplicable; costs incurred by Landlord in connection
with the correction of defects in design and original construction of
the Building or Project; costs incurred by Landlord for the repair of
structural defects; attorney's fees, costs and disbursements and other
expenses incurred in connection with negotiations or disputes with
tenants or other occupants of the Building or with prospective tenants
(other than attorney's fees, costs and disbursements and other
expenses incurred by Landlord in seeking to enforce Building rules and
regulations); any cost or expense related to removal, cleaning,
abatement or remediation of "hazardous materials" in or about the
Building, Common Area, Project or Property, including, without
limitation, hazardous substances in the
8
<PAGE>
ground water or soil, except to the extent such removal, cleaning,
abatement or remediation is related to the general repair and
maintenance of the Building, Common Area, Project or Property in the
ordinary course of business; reserves not spent by Landlord by the end
of the calendar year for which Expenses are paid; Landlord's costs of
electricity and other services sold or provided to tenants in the
Building and for which Landlord is entitled to be reimbursed by such
tenants as a separate additional charge or rental over and above the
base rent or additional rent payable under the lease with such tenant;
or all items (including repairs) and services for which Tenant or
other tenants pay directly to third parties or for which Tenant or
other tenants reimburse (or are required to reimburse) Landlord (other
than through Expenses). If the Project is not at least 95% occupied
during any calendar year or if Landlord is not supplying services to
at least 95% of the total Rentable Square Footage of the Project at
any time during a calendar year, Expenses shall, at Landlord's option,
be determined as if the Project had been 95% occupied and Landlord had
been supplying services to 95% of the Rentable Square Footage of the
Project during that calendar year. The extrapolation of Expenses under
this Section shall be performed by appropriately adjusting the cost of
those components of Expenses that are impacted by changes in the
occupancy of the Project.
D. Taxes Defined. "Taxes" shall mean: (1) all real estate taxes and other
-------------
assessments on the Building, Property and/or Project, including, but
not limited to, assessments for special improvement districts and
building improvement districts, taxes and assessments levied in
substitution or supplementation in whole or in part of any such taxes
and assessments and the Project's share of any real estate taxes and
assessments under any reciprocal easement agreement, common area
agreement or similar agreement as to the Project; (2) all personal
property taxes for property that is owned by Landlord and used in
connection with the operation, maintenance and repair of the Project;
and (3) all costs and fees incurred in connection with seeking
reductions in any tax liabilities described in (1) and (2), including,
without limitation, any costs incurred by Landlord for compliance,
review and appeal of tax liabilities. Without limitation, Taxes shall
not include any income, capital levy, franchise, capital stock, gift,
transfer, estate or inheritance tax. If an assessment is payable in
installments, Taxes for the year shall include the amount of the
installment and any interest due and payable during that year. For all
other real estate taxes, Taxes for that year shall, at Landlord's
election, include either the amount accrued, assessed or otherwise
imposed for the year or the amount due and payable for that year,
provided that Landlord's election shall be applied consistently
throughout the Term. If a change in Taxes is obtained for any year of
the Term, then Taxes for that year will be retroactively adjusted and
Landlord shall provide Tenant with a credit, if any, based on the
adjustment.
Tenant shall be responsible for, and shall pay prior to delinquency,
taxes or governmental service fees, possessory interest taxes, fees or
charges in lieu of any such taxes, capital levies, or other charges
imposed upon, levied with respect to, or assessed against, its
personal property, and its interest pursuant to this Lease. To the
extent that any such taxes are not separately assessed or billed to
Tenant, Tenant shall pay the amount thereof as invoiced to Tenant by
Landlord prior to the delinquency of such taxes. In the event that the
tenant improvements in the Building which correspond to the Initial
Alterations, as
9
<PAGE>
defined in this Lease, are assessed and taxed separately by the
applicable taxing authority, then Tenant shall be liable and shall pay
that portion of the Taxes applicable to the value of the Initial
Alterations in the Premises based on the value attributed thereto by
the applicable taxing authority to either (a) the applicable taxing
authority prior to the delinquency of such taxes in the event Tenant
is billed directly by such taxing authority, or (b) the Landlord
within 30 days after written demand, in the event Landlord is billed
directly by the applicable taxing authority.
E. Audit Rights. Tenant may, within 120 days after receiving Landlord's
------------
statement of Expenses, give Landlord written notice ("Review Notice")
that Tenant intends to review Landlord's records of the Expenses for
that calendar year. Within a reasonable time after receipt of the
Review Notice, Landlord shall make all pertinent records available for
inspection that are reasonably necessary for Tenant to conduct its
review. If any records are maintained at a location other than the
office of the Project, Tenant may either inspect the records at such
other location or pay for the reasonable cost of copying and shipping
the records. If Tenant retains an agent to review Landlord's records,
the agent must be with a licensed CPA firm. Tenant shall be solely
responsible for all costs, expenses and fees incurred for the audit.
Within 60 days after the records are made available to Tenant, Tenant
shall have the right to give Landlord written notice (an "Objection
Notice") stating in reasonable detail any objection to Landlord's
statement of Expenses for that year. If Tenant fails to give Landlord
an Objection Notice within the 60 day period or fails to provide
Landlord with a Review Notice within the 120 day period described
above, Tenant shall be deemed to have approved Landlord's statement of
Expenses and shall be barred from raising any claims regarding the
Expenses for that year. If Tenant provides Landlord with a timely
Objection Notice, Landlord and Tenant shall work together in good
faith to resolve any issues raised in Tenant's Objection Notice. If
Landlord and Tenant determine that Expenses for the calendar year are
less than reported, Landlord shall provide Tenant with a credit
against the next installment of Rent in the amount of the overpayment
by Tenant. Likewise, if Landlord and Tenant determine that Expenses
for the calendar year are greater than reported, Tenant shall pay
Landlord the amount of any underpayment within 30 days. In addition,
if Landlord and Tenant determine that Expenses for the Project for the
year in question were less than stated by more than 5%, Landlord,
within 30 days after its receipt of paid invoices therefor from
Tenant, shall reimburse Tenant for any reasonable amounts paid by
Tenant to third parties in connection with such review by Tenant. The
records obtained by Tenant shall be treated as confidential. In no
event shall Tenant be permitted to examine Landlord's records or to
dispute any statement of Expenses unless Tenant has paid and continues
to pay all Rent when due.
V. Compliance with Laws; Use.
The Premises shall be used only for the Permitted Use and for no other use
whatsoever. Tenant shall not use or permit the use of the Premises for any
purpose which is illegal, dangerous to persons or property or which, in
Landlord's reasonable opinion, unreasonably disturbs any other tenants of the
Building or the Project or interferes with the operation of the Building or the
Project. Tenant shall comply with all Laws, including the Americans with
Disabilities Act, regarding the operation of Tenant's business and the use,
condition,
10
<PAGE>
configuration and occupancy of the Premises. Tenant, within 10 days after
receipt, shall provide Landlord with copies of any notices it receives regarding
a violation or alleged violation of any Laws. Tenant shall comply with the rules
and regulations of the Project attached as Exhibit B and such other reasonable
rules and regulations adopted by Landlord from time to time. Tenant shall also
cause its agents, contractors, subcontractors, employees, customers, and
subtenants to comply with all rules and regulations. Landlord shall use its
reasonable efforts not to discriminate against Tenant in Landlord's enforcement
of the rules and regulations.
VI. Security Deposit.
The Security Deposit shall be in the form of an irrevocable letter of
credit (the "Letter of Credit") which shall: (a) be in the amount of
$1,200,000.00; (b) be issued on the form attached hereto as Exhibit G; (c) name
Landlord as its beneficiary; (d) be drawn on an FDIC insured financial
institution satisfactory to Landlord; and (e) expire no earlier than 30 days
after the Termination Date of this Lease. The Security Deposit shall be
delivered to Landlord upon the execution of this Lease by Tenant and shall be
held by Landlord without liability for interest (unless required by Law) as
security for the performance of Tenant's obligations. The Security Deposit is
not an advance payment of Rent or a measure of Tenant's liability for damages.
Landlord may, from time to time, without prejudice to any other remedy, use only
that portion of the Security Deposit required to satisfy past due Rent or to
cure any default by Tenant that remains uncured beyond any applicable notice and
cure period. If Landlord uses the Security Deposit, Tenant shall on demand
restore the Security Deposit to its original amount. Landlord shall return any
unapplied portion of the Security Deposit to Tenant within 30 days after the
later to occur of: (1) the date Tenant surrenders possession of the Premises to
Landlord in accordance with this Lease; or (2) the date this Lease terminates.
If Landlord transfers its interest in the Premises, Landlord shall assign the
Security Deposit to the transferee and, following the assignment, Landlord shall
have no further liability for the return of the Security Deposit, provided the
transferee assumes in writing Landlord's liability hereunder. Landlord shall
not be required to keep the Security Deposit separate from its other accounts.
Notwithstanding anything herein to the contrary, provided Tenant is not in
default under this Lease beyond any applicable notice or cure period as of the
effective date of any reduction of the Security Deposit, Tenant shall have the
right to reduce the amount of the Security Deposit (i.e., the Letter of Credit)
to be as follows: (i) $800,000.00 effective as of the 5th anniversary of the
Commencement Date; and (ii) $400,000.00 effective as of the 6th anniversary of
the Commencement Date. Such reduction shall be accomplished by having Tenant
provide Landlord with a substitute letter of credit in the reduced amount.
VII. Services.
A. Tenant will be responsible, at its sole cost and expense, for the
furnishing of all services and utilities to the Premises, including,
but not limited to, heating, ventilation and air-conditioning,
electricity, water, light, power, trash pick-up, sewer charges,
telephone, janitorial and interior Building security services and all
other utility services supplied to the Premises, and all taxes and
surcharges thereon. Landlord agrees to maintain and repair the
Property as described in Article IX.B.
B. Any interruption or termination of, services due to the application of
Laws, the failure of any equipment, the performance of repairs,
improvements or alterations, or the occurrence of any other event (a
"Service Failure") shall not
11
<PAGE>
render Landlord liable to Tenant, constitute a constructive eviction
of Tenant, give rise to an abatement of Rent, nor relieve Tenant from
the obligation to fulfill any covenant or agreement. Furthermore, in
no event shall Landlord be liable to Tenant for any loss or damage,
including the theft of Tenant's Property (defined in Article XV),
arising out of or in connection with the failure of any security
services, personnel or equipment.
VIII. Leasehold Improvements.
All improvements to the Premises other than Tenant's Property
(collectively, "Leasehold Improvements") shall be owned by Landlord and shall
remain upon the Premises without compensation to Tenant. However, Landlord, by
written notice to Tenant within 30 days prior to the Termination Date, may
require Tenant to remove, at Tenant's expense: (1) Cable (defined in Section
IX.A) installed by or for the exclusive benefit of Tenant and located in the
Premises or other portions of the Project; and (2) any Leasehold Improvements
that are performed by or for the benefit of Tenant and, in Landlord's reasonable
judgment, are of a nature that would require removal and repair costs that are
materially in excess of the removal and repair costs associated with standard
office improvements (collectively referred to as "Required Removables").
Without limitation, it is agreed that Required Removables include internal
stairways, raised floors, personal baths and showers, vaults, rolling file
systems and structural alterations and modifications of any type. The Required
Removables designated by Landlord shall be removed by Tenant before the
Termination Date, provided that upon prior written notice to Landlord, Tenant
may remain in the Premises for up to 5 days after the Termination Date for the
sole purpose of removing the Required Removables. Tenant's possession of the
Premises shall be subject to all of the terms and conditions of this Lease,
including the obligation to pay Rent on a per diem basis at the rate in effect
for the last month of the Term. Tenant shall repair damage caused by the
installation or removal of Required Removables. If Tenant fails to remove any
Required Removables or perform related repairs in a timely manner, Landlord, at
Tenant's expense, may remove and dispose of the Required Removables and perform
the required repairs. Tenant, within 30 days after receipt of an invoice, shall
reimburse Landlord for the reasonable costs incurred by Landlord.
Notwithstanding the foregoing, Tenant, at the time it requests approval for a
proposed Alteration (defined in Section IX.C), may request in writing that
Landlord advise Tenant whether the Alteration or any portion of the Alteration
will be designated as a Required Removable. Within 10 days after receipt of
Tenant's request, Landlord shall advise Tenant in writing as to which portions
of the Alteration, if any, will be considered to be Required Removables.
IX. Repairs, Maintenance and Alterations.
A. Tenant's Repair and Maintenance Obligations. Subject to the
-------------------------------------------
provisions of Articles XVII and XVIII below, Tenant shall, at its sole
cost and expense, promptly perform all maintenance and repairs to the
Premises that are not Landlord's express responsibility under this
Lease, and shall keep the Premises (interior and exterior) in good
condition and repair (including the replacement of any applicable
improvements and appurtenances when necessary), reasonable wear and
tear excepted. Tenant's repair and replacement obligations include,
without limitation, repairs to and replacements of: (1) floor
covering; (2) interior partitions; (3) doors; (4) walls and wall
coverings; (5) electronic, phone and data cabling and related
equipment (collectively, "Cable") that is installed by or for the
exclusive benefit of Tenant and located in the Premises or other
portions of the Project; (6) private showers and kitchens, including
hot water heaters, and
12
<PAGE>
similar facilities; (7) mechanical (including HVAC), plumbing
fixtures, sewer connections (within the Building), wiring, electrical,
lighting, and fire, life safety equipment and systems serving and
located within the Building and the Premises; (8) windows, glass and
plate glass; (9) ceilings; (10) roof membrane(s); (11) skylights; (12)
fixtures and equipment; and (13) Alterations performed by contractors
retained by Tenant, including related HVAC balancing. All work shall
be performed in accordance with the rules and procedures described in
Section IX.C. below. In addition, Tenant shall, at its sole cost and
expense, provide janitorial service to the Premises in a manner
consistent with other similar office projects in the Mountain View,
California area. The janitorial service to be provided by Tenant shall
include, but not be limited to, the obligation to clean the exterior
windows and to keep the interior of the Premises such as the windows,
floors, walls, doors, showcases and fixtures clean and neat in
appearance and to remove all trash and debris which may be found in or
around the Premises. Tenant shall also enter into and keep and
maintain in effect, service contracts reasonably acceptable to
Landlord with contractors reasonably acceptable to Landlord for the
maintenance of those systems servicing the Building as Landlord may
reasonably designate, including, without limitation, the HVAC,
electrical and life safety systems of the Building. Without limiting
the foregoing, Tenant shall, at Tenant's sole cost and expense, (a)
immediately replace all broken glass in the Premises with glass equal
to or in excess of the specification and quality of the original
glass; and (b) repair any damage caused by Tenant, Tenant's agents,
employees, invitees, visitors, subtenants or contractors. If Tenant
fails to make any repairs or replacements to the Premises or fails to
perform the required janitorial work in the Premises at the level
required for more than 15 days after notice from Landlord (although
notice shall not be required if there is an emergency), Landlord may
make the repairs or replacements or perform the janitorial work, as
the case may be, and Tenant shall pay the reasonable cost of the
repairs, replacements or janitorial work, as the case may be, to
Landlord within 30 days after receipt of an invoice, together with an
administrative charge in an amount equal to 10% of the cost of the
work performed. Tenant shall maintain written records of maintenance
and repairs and shall use certified technicians to perform any such
maintenance and repairs.
B. Landlord's Repair Obligations. Landlord shall keep and maintain in
------------------------------
good repair and working order and make repairs to and perform
maintenance upon: (1) the structural elements of the Building,
including, without limitation, the columns, footings, structural
floor, interior load bearing and exterior walls; (2) Common Areas,
except that Tenant shall pay for its share of the maintenance and
repairs to such Common Areas to the extent such costs are properly
included in Expenses; and (3) the roof of the Building, including roof
screens and roof screen penetrators, but excluding the roof membrane.
Landlord shall promptly make repairs (considering the nature and
urgency of the repair) for which Landlord is responsible.
C. Alterations. Tenant shall not make alterations, additions or
------------
improvements to the Premises or install any Cable in the Premises or
other portions of the Building or the Project (collectively referred
to as "Alterations") without first obtaining the written consent of
Landlord in each instance, which consent shall not be unreasonably
withheld or delayed. However, Landlord's consent shall not be
13
<PAGE>
required for any Alteration that satisfies all of the following
criteria (a "Cosmetic Alteration"): (1) is not visible from the
exterior of the Premises or Building; (2) will not affect the systems
or structure of the Building; and (3) costs less than $25,000.00
individually or $50,000.00 in the aggregate during any one year of the
Term. However, even though consent is not required, the performance of
Cosmetic Alterations shall be subject to all the other provisions of
this Section IX.C. Prior to starting work, Tenant shall furnish
Landlord with plans and specifications reasonably acceptable to
Landlord (if necessary for the issuance of required permits or if
reasonably deemed necessary by Landlord due to the nature of the work
to be performed); names of contractors reasonably acceptable to
Landlord (provided that Landlord may designate specific contractors
with respect to Building systems); copies of contracts; necessary
permits and approvals; evidence of contractor's and subcontractor's
insurance in amounts reasonably required by Landlord; and as to
projects in excess of $100,000.00, any security for performance that
is reasonably required by Landlord. Changes to the plans and
specifications must also be submitted to Landlord for its approval.
Alterations shall be constructed in a good and workmanlike manner
using materials of a quality that is at least equal to the quality
designated by Landlord as the minimum standard for the Building and
the Project. Landlord may designate reasonable rules, regulations and
procedures for the performance of work in the Building and the Project
and, to the extent reasonably necessary to avoid disruption to the
occupants of the Building and the Project, shall have the right to
designate the time when Alterations may be performed. Tenant shall
reimburse Landlord within 30 days after receipt of an invoice for the
actual, reasonable sums paid by Landlord for third party examination
of Tenant's plans for non-Cosmetic Alterations. In addition, within 30
days after receipt of an invoice from Landlord, Tenant shall pay
Landlord a fee for Landlord's oversight and coordination of any non-
Cosmetic Alterations equal to 5% of the cost of the non-Cosmetic
Alterations. Upon completion, Tenant shall furnish "as-built" plans
(except for Cosmetic Alterations), completion affidavits, full and
final waivers of lien in recordable form, and receipted bills covering
all labor and materials. Tenant shall assure that the Alterations
comply with all insurance requirements and Laws. Landlord's approval
of an Alteration shall not be a representation by Landlord that the
Alteration complies with applicable Laws or will be adequate for
Tenant's use.
X. Use of Utility Services by Tenant.
A. Electricity, gas, water and other utility services used by Tenant in
the Premises shall, at Landlord's option, be paid for by Tenant
either: (1) through inclusion in Expenses (except as provided in
Section X.B. for excess usage); (2) by a separate charge payable by
Tenant to Landlord within 30 days after billing by Landlord; or (3) by
separate charge billed by the applicable utility company and payable
directly by Tenant. Electrical service to the Premises may be
furnished by one or more companies providing electrical generation,
transmission and distribution services, and the cost of electricity
may consist of several different components or separate charges for
such services, such as generation, distribution and stranded cost
charges. Landlord shall have the exclusive right to select any
company providing electrical service to the Premises, to aggregate the
electrical service for the Property and Premises with other buildings,
to purchase electricity through a broker and/or buyers group and to
change the
14
<PAGE>
providers and manner of purchasing electricity. Landlord shall be
entitled to receive a fee (if permitted by Law) for the selection of
utility companies and the negotiation and administration of contracts
for electricity, provided that the amount of such fee shall not exceed
50% of any savings obtained by Landlord.
B. Tenant's use of electrical service shall not exceed, either in
voltage, rated capacity or overall load, that which Landlord deems to
be standard for the Building. If Tenant requests permission to
consume excess electrical service, Landlord may refuse to consent or
may condition consent upon conditions that Landlord reasonably elects
(including, without limitation, the installation of utility service
upgrades, meters, submeters, air handlers or cooling units), and the
additional usage (to the extent permitted by Law), installation and
maintenance costs shall be paid by Tenant. Landlord's consent to
Tenant's request to consume excess electrical service shall not be
unreasonably withheld. Landlord shall have the right to separately
meter electrical usage for the Premises and to measure electrical
usage by survey or other commonly accepted methods.
XI. Entry by Landlord.
Landlord, its agents, contractors and representatives may enter the
Premises to inspect or show the Premises, to clean and make repairs, alterations
or additions to the Premises, and to conduct or facilitate repairs, alterations
or additions to any portion of the Building or the Project, including other
tenants' premises. Notwithstanding the foregoing to the contrary, Landlord
shall only be permitted to show the Premises to prospective tenants during the
last 6 months of the Term. However, Landlord may show the Premises to
prospective buyers, lenders and others at any time during the Term. Except in
emergencies or to provide janitorial service (if Landlord so elects in
accordance with Article IX.A. above) and other regularly scheduled services
after Normal Business Hours, Landlord shall provide Tenant with reasonable prior
notice of entry into the Premises, which may be given orally. If reasonably
necessary for the protection and safety of Tenant and its employees, Landlord
shall have the right to temporarily close all or a portion of the Premises to
perform repairs, alterations and additions which Landlord is required to perform
under the Lease. However, except in emergencies, Landlord will not close the
Premises if the work can reasonably be completed on weekends and after Normal
Business Hours. Except in the event of emergencies, any entry by Landlord and
Landlord's agents shall comply with Tenant's reasonable security measures.
Entry by Landlord shall not constitute constructive eviction or entitle Tenant
to an abatement or reduction of Rent. Notwithstanding the foregoing, except in
emergency situations as determined by Landlord, Landlord shall exercise
reasonable efforts to perform any entry into the Premises in a manner that is
reasonably designed to minimize interference with the operation of Tenant's
business in the Premises. Notwithstanding the foregoing, Tenant may, at its own
expense, provide its own locks to an area within the Premises ("Secured Area").
Tenant need not furnish Landlord with a key but upon the Termination Date,
Tenant shall surrender all such keys to Landlord. If Landlord must gain access
to a Secured Area in a non-emergency situation, Landlord shall contact Tenant
and Landlord and Tenant shall arrange a mutually agreed upon time for Landlord
to do so. Landlord shall comply with all reasonable security measures
pertaining to the Secured Area. If Landlord determines in its sole discretion
that an emergency in the Building or the Premises, including, without
limitation, a suspected fire or flood, requires Landlord to gain access to the
Secured Area, Tenant hereby authorizes Landlord to forcibly enter the Secured
Area. In such event, Landlord shall have no liability whatsoever to Tenant, and
Tenant shall pay all reasonable expenses incurred by Landlord in repairing or
reconstructing any entrance, corridor, door or other portions of the Premises
15
<PAGE>
damaged as a result of a forcible entry by Landlord. Landlord shall have no
obligation to provide either janitorial service or cleaning in the Secured Area.
XII. Assignment and Subletting.
A. Except in connection with a Permitted Transfer (defined in Section
XII.E. below), Tenant shall not assign, sublease, transfer or encumber
any interest in this Lease or allow any third party to use any portion
of the Premises (collectively or individually, a "Transfer") without
the prior written consent of Landlord, which consent shall not be
unreasonably withheld if Landlord does not elect to exercise its
termination rights under Section XII.B below. Without limitation, it
is agreed that Landlord's consent shall not be considered unreasonably
withheld if: (1) the proposed transferee's financial condition does
not meet the criteria Landlord uses to select Project tenants having
similar leasehold obligations; (2) the proposed transferee's business
is not suitable for the Building or the Project considering the
business of the other tenants and the Project's prestige, or would
result in a violation of another tenant's rights; (3) the proposed
transferee is a governmental agency or occupant of the Project; (4)
Tenant is in default after the expiration of the notice and cure
periods in this Lease; or (5) any portion of the Building, Project or
Premises would likely become subject to additional or different Laws
which would have a material adverse affect on the Building, Property
or Project as a consequence of the proposed Transfer. Notwithstanding
the foregoing, Landlord will not withhold its consent solely because
the proposed subtenant or assignee is an occupant of the Project if
Landlord does not have space available for lease in the Project that
is comparable to the space Tenant desires to sublet or assign. For
purposes hereof, Landlord shall be deemed to have comparable space if
it has space available anywhere in the Project that is approximately
the same size as the space Tenant desires to sublet or assign within 6
months of the proposed commencement of the proposed sublease or
assignment. Tenant shall not be entitled to receive monetary damages
based upon a claim that Landlord unreasonably withheld its consent to
a proposed Transfer and Tenant's sole remedy shall be an action to
enforce any such provision through specific performance or declaratory
judgment. Any attempted Transfer in violation of this Article shall,
at Landlord's option, be void. Consent by Landlord to one or more
Transfer(s) shall not operate as a waiver of Landlord's rights to
approve any subsequent Transfers. In no event shall any Transfer or
Permitted Transfer release or relieve Tenant from any obligation under
this Lease.
B. As part of its request for Landlord's consent to a Transfer, Tenant
shall provide Landlord with financial statements for the proposed
transferee, a complete copy of the proposed assignment, sublease and
other contractual documents and such other information as Landlord may
reasonably request. Landlord shall, by written notice to Tenant
within 30 days of its receipt of the required information and
documentation, either: (1) consent to the Transfer by the execution of
a consent agreement in a form reasonably designated by Landlord or
reasonably refuse to consent to the Transfer in writing; or (2) in the
event of (a) a subletting of any portion of the Premises (other than
pursuant to a Permitted Transfer) which would result in the equivalent
of one full floor or more of the Premises, in the aggregate, being
subject to sublease(s) for the remaining Term of the Lease, or (b) an
assignment of this Lease (other than pursuant to a Permitted
Transfer),
16
<PAGE>
exercise its right to terminate this Lease with respect to the portion
of the Premises that Tenant is proposing to assign or sublet. Any such
termination shall be effective on the proposed effective date of the
Transfer for which Tenant requested consent. Tenant shall pay Landlord
a review fee of $750.00 for Landlord's review of any Permitted
Transfer or requested Transfer, provided if Landlord's actual
reasonable costs and expenses (including reasonable attorney's fees)
exceed $750.00, Tenant shall reimburse Landlord for its actual
reasonable costs and expenses in lieu of a fixed review fee.
Notwithstanding the foregoing, provided that Tenant does not request
any changes to this Lease or Landlord's standard form of consent in
connection with the proposed transfer, such costs and expenses shall
not exceed $1,000.00.
C. Except in the event of a Permitted Transfer, Tenant shall pay Landlord
50% of all rent and other consideration which Tenant receives as a
result of a Transfer that is in excess of the Rent payable to Landlord
for the portion of the Premises and Term covered by the Transfer.
Tenant shall pay Landlord for Landlord's share of any excess within 30
days after Tenant's receipt of such excess consideration. Tenant may
deduct from the excess all reasonable and customary expenses directly
incurred by Tenant attributable to the Transfer (other than Landlord's
review fee), including brokerage fees, legal fees and construction
costs. If Tenant is in Monetary Default (defined in Section XIX.A.
below), Landlord may require that all sublease payments be made
directly to Landlord, in which case Tenant shall receive a credit
against Rent in the amount of any payments received (less Landlord's
share of any excess).
D. Except as provided below with respect to a Permitted Transfer, if
Tenant is a corporation, limited liability company, partnership, or
similar entity, and if the entity which owns or controls a majority of
the voting shares/rights at any time changes for any reason (including
but not limited to a merger, consolidation or reorganization), such
change of ownership or control shall constitute a Transfer. The
foregoing shall not apply so long as Tenant is an entity whose
outstanding stock is listed on a recognized security exchange, or if
at least 80% of its voting stock is owned by another entity, the
voting stock of which is so listed.
E. Notwithstanding anything to the contrary contained herein or in
Section XII.D., Tenant may assign its entire interest under this Lease
or sublet all or any portion of the Premises to a wholly owned
corporation, partnership or other legal entity or affiliate,
subsidiary or parent of Tenant or to any successor to Tenant by
purchase, merger, consolidation or reorganization (hereinafter,
collectively, referred to as "Permitted Transfer") without the consent
of Landlord, provided: (i) Tenant is not in default under this Lease
after the expiration of any applicable notice and cure periods; (ii)
if such proposed transferee is a successor to Tenant by purchase,
merger, consolidation or reorganization, the continuing or surviving
entity shall own all or substantially all of the assets of Tenant and
shall have a net worth which is at least equal to the greater of
Tenant's net worth at the date of this Lease or Tenant's net worth at
the date of the Transfer; (iii) such proposed transferee operates the
business in the Premises for the Permitted Use and no other purpose;
and (iv) in no event shall any Permitted Transfer release or relieve
Tenant from any of its obligations under this Lease. Tenant shall
give Landlord written notice at least 10 days prior to the effective
date of such Permitted Transfer. As used herein: (a) "parent" shall
mean a company
17
<PAGE>
which owns a majority of Tenant's voting equity; (b) "subsidiary"
shall mean an entity wholly owned by Tenant or at least 51% of whose
voting equity is owned by Tenant; and (c) "affiliate" shall mean an
entity controlled, controlling or under common control with Tenant.
Notwithstanding the foregoing, sale of the shares of equity of any
affiliate or subsidiary to which this Lease has been assigned or
transferred other than (x) to another parent, subsidiary or affiliate
of the original Tenant named hereunder, or (y) an entity whose
outstanding stock is listed on a recognized security exchange shall be
deemed to be an assignment requiring the consent of Landlord
hereunder.
XIII. Liens.
Tenant shall not permit mechanic's or other liens to be placed upon the
Project, Property, Premises or Tenant's leasehold interest in connection with
any work or service done or purportedly done by or for benefit of Tenant. If a
lien is so placed, Tenant shall, within 10 days of notice from Landlord of the
filing of the lien, fully discharge the lien by settling the claim which
resulted in the lien or by bonding or insuring over the lien in the manner
prescribed by the applicable lien Law. If Tenant fails to discharge the lien,
then, in addition to any other right or remedy of Landlord, Landlord may bond or
insure over the lien or otherwise discharge the lien. Tenant shall reimburse
Landlord for any amount paid by Landlord to bond or insure over the lien or
discharge the lien, including, without limitation, reasonable attorneys' fees
(if and to the extent permitted by Law) within 30 days after receipt of an
invoice from Landlord.
XIV. Indemnity and Waiver of Claims.
A. Except to the extent caused by the negligence or willful misconduct of
Landlord or any Landlord Related Parties (defined below), Tenant shall
indemnify, defend and hold Landlord, its trustees, members,
principals, beneficiaries, partners, officers, directors, employees,
Mortgagee(s) (defined in Article XXVI) and agents ("Landlord Related
Parties") harmless against and from all liabilities, obligations,
damages, penalties, claims, actions, costs, charges and expenses,
including, without limitation, reasonable attorneys' fees and other
professional fees (if and to the extent permitted by Law), which may
be imposed upon, incurred by or asserted against Landlord or any of
the Landlord Related Parties and arising out of or in connection with
any damage or injury occurring in the Premises or any acts or
omissions (including violations of Law) of Tenant, the Tenant Related
Parties (defined below) or any of Tenant's transferees, contractors or
licensees.
B. Except to the extent caused by the negligence or willful misconduct of
Tenant or any Tenant Related Parties (defined below), Landlord shall
indemnify, defend and hold Tenant, its trustees, members, principals,
beneficiaries, partners, officers, directors, employees and agents
("Tenant Related Parties") harmless against and from all liabilities,
obligations, damages, penalties, claims, actions, costs, charges and
expenses, including, without limitation, reasonable attorneys' fees
and other professional fees (if and to the extent permitted by Law),
which may be imposed upon, incurred by or asserted against Tenant or
any of the Tenant Related Parties and arising out of or in connection
with the acts or omissions (including violations of Law) of Landlord,
the Landlord Related Parties or any of Landlord's contractors.
18
<PAGE>
C. Landlord and the Landlord Related Parties shall not be liable for, and
Tenant waives, all claims for loss or damage to Tenant's business or
loss, theft or damage to Tenant's Property or the property of any
person claiming by, through or under Tenant resulting from: (1) wind
or weather; (2) the failure of any sprinkler, heating or air-
conditioning equipment, any electric wiring or any gas, water or steam
pipes; (3) the backing up of any sewer pipe or downspout; (4) the
bursting, leaking or running of any tank, water closet, drain or other
pipe; (5) water, snow or ice upon or coming through the roof,
skylight, stairs, doorways, windows, walks or any other place upon or
near the Building or the Project; (6) any act or omission of any party
other than Landlord or Landlord Related Parties; and (7) any causes
not reasonably within the control of Landlord. Tenant shall insure
itself against such losses under Article XV below.
XV. Insurance.
Tenant shall carry and maintain the following insurance ("Tenant's
Insurance"), at its sole cost and expense: (1) Commercial General Liability
Insurance applicable to the Premises and its appurtenances providing, on an
occurrence basis, a minimum combined single limit of $3,000,000.00; (2) All Risk
Property/Business Interruption Insurance, including flood and earthquake,
written at replacement cost value and with a replacement cost endorsement
covering all of Tenant's trade fixtures, equipment, furniture and other personal
property within the Premises ("Tenant's Property"); (3) Workers' Compensation
Insurance as required by the state in which the Premises is located and in
amounts as may be required by applicable statute; and (4) Employers Liability
Coverage of at least $1,000,000.00 per occurrence. Any company writing any of
Tenant's Insurance shall have an A.M. Best rating of not less than A-VIII. All
Commercial General Liability Insurance policies shall name Tenant as a named
insured and Landlord (or any successor), Equity Office Properties Trust, a
Maryland real estate investment trust, EOP Operating Limited Partnership, a
Delaware limited partnership, and their respective members, principals,
beneficiaries, partners, officers, directors, employees, and agents, and other
designees of Landlord as the interest of such designees shall appear, as
additional insureds. All policies of Tenant's Insurance shall contain
endorsements that the insurer(s) shall give Landlord and its designees at least
30 days' advance written notice of any change, cancellation, termination or
lapse of insurance. Tenant shall provide Landlord with a certificate of
insurance evidencing Tenant's Insurance prior to the earlier to occur of the
Commencement Date or the date Tenant is provided with possession of the Premises
for any reason, and upon renewals at least 15 days prior to the expiration of
the insurance coverage. Landlord shall maintain so called All Risk property
insurance on the Building at replacement cost value, as reasonably estimated by
Landlord. Except as specifically provided to the contrary, the limits of either
party's' insurance shall not limit such party's liability under this Lease.
XVI. Subrogation.
Notwithstanding anything in this Lease to the contrary, Landlord and Tenant
hereby waive and shall cause their respective insurance carriers to waive any
and all rights of recovery, claim, action or causes of action against the other
and their respective trustees, principals, beneficiaries, partners, officers,
directors, agents, and employees, for any loss or damage that may occur to
Landlord or Tenant or any party claiming by, through or under Landlord or
Tenant, as the case may be, with respect to Tenant's Property, the Project, the
Building, the Premises, any additions or improvements to the Project, Building
or Premises, or any contents thereof, including all rights of recovery, claims,
actions or causes of action arising out of the negligence of Landlord or any
Landlord Related Parties or the negligence of Tenant or any Tenant Related
19
<PAGE>
Parties, which loss or damage is (or would have been, had the insurance required
by this Lease been carried) covered by insurance.
XVII. Casualty Damage.
A. If all or any part of the Premises is damaged by fire or other
casualty, Tenant shall immediately notify Landlord in writing. During
any period of time that all or a material portion of the Premises is
damaged as a result of a fire or other casualty, the Rent shall abate
for the portion of the Premises that is untenantable and not used by
Tenant. Landlord shall have the right to terminate this Lease if:
(1) the Building or the Project shall be damaged so that, in
Landlord's reasonable judgment, substantial alteration or
reconstruction of the Building or the Project, as the case may be,
shall be required (whether or not the Premises has been damaged); (2)
Landlord is not permitted by Law to rebuild the Building or the
Project in substantially the same form as existed before the fire or
casualty; (3) the Premises have been materially damaged and there is
less than 1 year of the Term remaining on the date of the casualty;
(4) any Mortgagee requires that the insurance proceeds be applied to
the payment of the mortgage debt; or (5) a material uninsured loss to
the Building or the Project occurs. Landlord may exercise its right
to terminate this Lease by notifying Tenant in writing within 90 days
after the date of the casualty. In addition to Landlord's rights to
terminate as provided herein, Tenant shall have the right to terminate
this Lease if: (1) a substantial portion of the Premises has been
damaged by fire or other casualty and such damage cannot reasonably be
repaired within 60 days after the date of such fire or other casualty;
(2) there is less than one (1) year of the Term remaining on the date
of such casualty; (3) the casualty was not caused by the gross
negligence or willful misconduct of Tenant or its agents, employees or
contractors; and (4) Tenant provides Landlord with written notice of
its intent to terminate within 30 days after the date of the fire or
other casualty. If neither Landlord nor Tenant elect to terminate
this Lease, Landlord shall commence and proceed with reasonable
diligence to repair and restore the Building and the Leasehold
Improvements substantially to the condition that existed immediately
prior to such damage (excluding any Alterations that were performed by
Tenant in violation of this Lease). However, in no event shall
Landlord be required to spend more than the insurance proceeds
received by Landlord. Landlord shall not be liable for any loss or
damage to Tenant's Property or to the business of Tenant resulting in
any way from the fire or other casualty or from the repair and
restoration of the damage. Landlord and Tenant hereby waive the
provisions of any Law relating to the matters addressed in this
Article, and agree that their respective rights for damage to or
destruction of the Premises shall be those specifically provided in
this Lease. Notwithstanding the foregoing to the contrary, in the
event that Landlord has the right to terminate this Lease pursuant to
this Article XVII, Landlord agrees to exercise such right in a
nondiscriminatory fashion. Consideration of the following factors in
arriving at its decision shall not be deemed discriminatory: Length
of term remaining on the lease, time needed to repair and restore,
costs of repair and restoration not covered by insurance proceeds,
Landlord's plans to repair and restore common areas serving the
Premises, Landlord's plans for repair and restoration of the Building
and/or the Project, and other relevant factors of Landlord's decision
as long as they are applied to Tenant in the same manner as other
tenants.
20
<PAGE>
B. If all or any portion of the Premises shall be made untenantable by
fire or other casualty, Landlord shall, with reasonable promptness,
cause an architect or general contractor selected by Landlord to
provide Landlord and Tenant with a written estimate of the amount of
time required to substantially complete the repair and restoration of
the Premises and make the Premises tenantable again, using standard
working methods ("Completion Estimate"). If the Completion Estimate
indicates that the Premises cannot be made tenantable within 210 days
from the date the repair and restoration is started, then regardless
of anything in Section XVII.A above to the contrary, Tenant shall have
the right to terminate this Lease by giving written notice to the
other of such election within 10 days after receipt of the Completion
Estimate. Tenant, however, shall not have the right to terminate this
Lease if the fire or casualty was caused by the gross negligence or
intentional misconduct of Tenant, Tenant Related Parties or any of
Tenant's transferees, contractors or licensees. Notwithstanding the
foregoing, if Tenant was entitled to but elected not to exercise its
right to terminate the Lease and Landlord does not substantially
complete the repair and restoration of the Premises within 2 months
after the expiration of the estimated period of time set forth in the
Completion Estimate, which period shall be extended to the extent of
any Reconstruction Delays, then Tenant may terminate this Lease by
written notice to Landlord within 15 days after the expiration of such
period, as the same may be extended. For purposes of this Lease, the
term "Reconstruction Delays" shall mean: (i) any delays caused by the
insurance adjustment process; (ii) any delays caused by Tenant; and
(iii) any delays caused by events of Force Majeure.
XVIII. Condemnation.
Either party may terminate this Lease if the whole or any material part
of the Premises shall be taken or condemned for any public or quasi-public use
under Law, by eminent domain or private purchase in lieu thereof (a "Taking").
Landlord shall also have the right to terminate this Lease if there is a Taking
of any portion of the Building, Property, or Project which would leave the
remainder of the Building or the Project unsuitable for use as an office
building or an office park, as the case may be, in a manner comparable to the
use of the Building and/or Project prior to the Taking. In order to exercise its
right to terminate the Lease, Landlord or Tenant, as the case may be, must
provide written notice of termination to the other within 45 days after the
terminating party first receives notice of the Taking. Any such termination
shall be effective as of the date the physical taking of the Premises or the
portion of the Project, Building or Property occurs. If this Lease is not
terminated, the Rentable Square Footage of the Building, the Rentable Square
Footage of the Premises, the Rentable Square Footage of the Project and Tenant's
Pro Rata Share shall, if applicable, be appropriately adjusted. In addition,
Rent for any portion of the Premises taken or condemned shall be abated during
the unexpired Term of this Lease effective when the physical taking of the
portion of the Premises occurs. In the event only a part of the Premises shall
be so condemned or taken and this Lease is not terminated as hereinbefore
provided, Landlord will, with reasonable diligence and at its expense (to the
extent covered by any condemnation award) restore the remaining portion of the
Premises as nearly as practicable to its condition immediately prior to such
condemnation or taking. All compensation awarded for a Taking, or sale
proceeds, shall be the property of Landlord, any right to receive compensation
or proceeds being expressly waived by Tenant. However, Tenant may file a
separate claim at its sole cost and expense for Tenant's Property and Tenant's
reasonable relocation expenses, moving costs, lost goodwill, and the unamortized
21
<PAGE>
value of improvements to the Premises that had been paid for by Tenant, provided
the filing of the claim does not diminish the award which would otherwise be
receivable by Landlord.
XIX. Events of Default.
Tenant shall be considered to be in default of this Lease upon the
occurrence of any of the following events of default:
A. Tenant's failure to pay when due all or any portion of the Rent, if
the failure continues for 5 days after written notice to Tenant
("Monetary Default").
B. Tenant's failure (other than a Monetary Default) to comply with any
term, provision or covenant of this Lease, if the failure is not cured
within 30 days after written notice to Tenant. However, if Tenant's
failure to comply cannot reasonably be cured within 30 days, Tenant
shall be allowed additional time as is reasonably necessary to cure
the failure so long as: (1) Tenant commences to cure the failure
within 30 days, and (2) Tenant diligently pursues a course of action
that will cure the failure and bring Tenant back into compliance with
the Lease. However, if Tenant's failure to comply creates a hazardous
condition, the failure must be cured immediately upon notice to
Tenant. In addition, if Landlord provides Tenant with notice of
Tenant's failure to comply with any particular term, provision or
covenant of the Lease on 3 occasions during any 12 month period,
Tenant's subsequent violation of such term, provision or covenant
shall, at Landlord's option, be an incurable event of default by
Tenant.
C. Tenant or any Guarantor becomes insolvent, makes a transfer in fraud
of creditors or makes an assignment for the benefit of creditors, or
admits in writing its inability to pay its debts when due.
D. The leasehold estate is taken by process or operation of Law.
E In the case of any retail Tenant, Tenant does not take possession of,
or abandons or vacates all or any portion of the Premises.
F. Tenant is in default beyond any notice and cure period under any other
lease or agreement with Landlord at the Project, including, without
limitation, any lease or agreement for parking.
XX. Remedies.
A. Upon the occurrence of any event or events of default under this Lease
after the expiration of any applicable notice and cure period
hereunder, whether enumerated in Article XIX or not, Landlord shall
have the option to pursue any one or more of the following remedies
without any notice (except as expressly prescribed herein) or demand
whatsoever:
1. Terminate this Lease and Tenant's right to possession of the
Premises and recover from Tenant an award of damages equal to the
sum of the following:
22
<PAGE>
(a) The Worth at the Time of Award of the unpaid Rent which had
been earned at the time of termination;
(b) The Worth at the Time of Award of the amount by which the
unpaid Rent which would have been earned after termination
until the time of award exceeds the amount of such Rent loss
that Tenant affirmatively proves could have been reasonably
avoided;
(c) The Worth at the Time of Award of the amount by which the
unpaid Rent for the balance of the Term after the time of
award exceeds the amount of such Rent loss that Tenant
affirmatively proves could be reasonably avoided;
(d) Any other amount necessary to compensate Landlord for all
the detriment either proximately caused by Tenant's failure
to perform Tenant's obligations under this Lease or which in
the ordinary course of things would be likely to result
therefrom; and
(e) All such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to time under
applicable law.
The "Worth at the Time of Award" of the amounts referred to in
parts (a) and (b) above, shall be computed by allowing interest
at the lesser of a per annum rate equal to: (i) the greatest per
annum rate of interest permitted from time to time under
applicable law, or (ii) the Prime Rate plus four percent (4%).
For purposes hereof, the "Prime Rate" shall be the per annum
interest rate publicly announced as its prime or base rate by a
federally insured bank selected by Landlord in the State of
California. The "Worth at the Time of Award" of the amount
referred to in part (c), above, shall be computed by discounting
such amount at the discount rate of the Federal Reserve Bank of
San Francisco at the time of award plus one percent (1%);
2. Employ the remedy described in California Civil Code (S) 1951.4
(Landlord may continue this Lease in effect after Tenant's breach
and abandonment and recover Rent as it becomes due, if Tenant has
the right to sublet or assign, subject only to reasonable
limitations); or
3. Notwithstanding Landlord's exercise of the remedy described in
California Civil Code (S) 1951.4 in respect of an event or events
of default, at such time thereafter as Landlord may elect in
writing, to terminate this Lease and Tenant's right to possession
of the Premises and recover an award of damages as provided above
in Paragraph XX.A.1.
B. The subsequent acceptance of Rent hereunder by Landlord shall not be
deemed to be a waiver of any preceding breach by Tenant of any term,
covenant or condition of this Lease, other than the failure of Tenant
to pay the particular Rent so accepted, regardless of Landlord's
knowledge of such preceding breach at the time of acceptance of such
Rent. No waiver by Landlord of any breach hereof shall be effective
unless such waiver is in writing and signed by Landlord.
23
<PAGE>
C. TENANT HEREBY WAIVES ANY AND ALL RIGHTS CONFERRED BY SECTION 3275 OF
THE CIVIL CODE OF CALIFORNIA AND BY SECTIONS 1174(c) AND 1179 OF THE
CODE OF CIVIL PROCEDURE OF CALIFORNIA AND ANY AND ALL OTHER LAWS AND
RULES OF LAW FROM TIME TO TIME IN EFFECT DURING THE LEASE TERM
PROVIDING THAT TENANT SHALL HAVE ANY RIGHT TO REDEEM, REINSTATE OR
RESTORE THIS LEASE FOLLOWING ITS TERMINATION BY REASON OF TENANT'S
BREACH. TENANT ALSO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, THE RIGHT TO TRIAL BY JURY IN ANY LITIGATION ARISING OUT OF OR
RELATING TO THIS LEASE.
D. No right or remedy herein conferred upon or reserved to Landlord is
intended to be exclusive of any other right or remedy, and each and
every right and remedy shall be cumulative and in addition to any
other right or remedy given hereunder or now or hereafter existing by
agreement, applicable law or in equity. In addition to other remedies
provided in this Lease, Landlord shall be entitled, to the extent
permitted by applicable Law, to injunctive relief, or to a decree
compelling performance of any of the covenants, agreements, conditions
or provisions of this Lease, or to any other remedy allowed to
Landlord at law or in equity. Forbearance by Landlord to enforce one
or more of the remedies herein provided upon an event of default shall
not be deemed or construed to constitute a waiver of such default.
E. This Article XX shall be enforceable to the maximum extent such
enforcement is not prohibited by applicable Law, and the
unenforceability of any portion thereof shall not thereby render
unenforceable any other portion.
XXI. Limitation of Liability.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE, THE LIABILITY
OF LANDLORD (AND OF ANY SUCCESSOR LANDLORD) TO TENANT SHALL BE LIMITED TO THE
INTEREST OF LANDLORD IN THE PROJECT. TENANT SHALL LOOK SOLELY TO LANDLORD'S
INTEREST IN THE PROJECT FOR THE RECOVERY OF ANY JUDGMENT OR AWARD AGAINST
LANDLORD. FOR PURPOSES HEREOF "INTEREST OF LANDLORD IN THE PROJECT" SHALL
INCLUDE RENTS DUE FROM TENANTS, INSURANCE PROCEEDS, AND PROCEEDS FROM
CONDEMNATION OR EMINENT DOMAIN PROCEEDINGS (PRIOR TO THE DISTRIBUTION OF THE
SAME TO ANY PARTNER OR SHAREHOLDER OF LANDLORD OR ANY OTHER THIRD PARTY).
NEITHER LANDLORD NOR ANY LANDLORD RELATED PARTY SHALL BE PERSONALLY LIABLE FOR
ANY JUDGMENT OR DEFICIENCY. BEFORE FILING SUIT FOR AN ALLEGED DEFAULT BY
LANDLORD, TENANT SHALL GIVE LANDLORD AND THE MORTGAGEE(S) (DEFINED IN ARTICLE
XXVI BELOW) WHOM TENANT HAS BEEN NOTIFIED HOLD MORTGAGES (DEFINED IN ARTICLE
XXVI BELOW) ON THE PROPERTY, BUILDING OR PREMISES, NOTICE AND REASONABLE TIME TO
CURE THE ALLEGED DEFAULT.
XXII. No Waiver.
Either party's failure to declare a default immediately upon its
occurrence, or delay in taking action for a default shall not constitute a
waiver of the default, nor shall it constitute an estoppel. Either party's
failure to enforce its rights for a default shall not constitute a waiver of
24
<PAGE>
its rights regarding any subsequent default. Receipt by Landlord of Tenant's
keys to the Premises shall not constitute an acceptance or surrender of the
Premises.
XXIII. Quiet Enjoyment.
Tenant shall, and may peacefully have, hold and enjoy the Premises,
subject to the terms of this Lease, provided Tenant pays the Rent and fully
performs all of its covenants and agreements within applicable notice and cure
periods. This covenant and all other covenants of Landlord shall be binding upon
Landlord and its successors only during its or their respective periods of
ownership of the Building, and shall not be a personal covenant of Landlord or
the Landlord Related Parties.
XXIV. Relocation.
INTENTIONALLY OMITTED.
XXV. Holding Over.
Except for any permitted occupancy by Tenant under Article VIII, if
Tenant fails to surrender the Premises at the expiration or earlier termination
of this Lease, occupancy of the Premises after the termination or expiration
shall be that of a tenancy at sufferance. Tenant's occupancy of the Premises
during the holdover shall be subject to all the terms and provisions of this
Lease and Tenant shall pay an amount (on a per month basis without reduction for
partial months during the holdover) equal to 150% of the greater of: (1) the sum
of the Base Rent and Additional Rent due for the period immediately preceding
the holdover; or (2) the fair market gross rental for the Premises as reasonably
determined by Landlord. No holdover by Tenant or payment by Tenant after the
expiration or early termination of this Lease shall be construed to extend the
Term or prevent Landlord from immediate recovery of possession of the Premises
by summary proceedings or otherwise. In addition to the payment of the amounts
provided above, if Landlord is unable to deliver possession of the Premises to a
new tenant, or to perform improvements for a new tenant, as a result of Tenant's
holdover and Tenant fails to vacate the Premises within 15 days after Landlord
notifies Tenant of Landlord's inability to deliver possession, or perform
improvements, Tenant shall be liable to Landlord for all damages, including,
without limitation, consequential damages, that Landlord suffers from the
holdover.
XXVI. Subordination to Mortgages; Estoppel Certificate.
Tenant accepts this Lease subject and subordinate to any mortgage(s),
deed(s) of trust, ground lease(s) or other lien(s) now or subsequently arising
upon the Premises, the Building, the Property or the Project, and to renewals,
modifications, refinancings and extensions thereof (collectively referred to as
a "Mortgage"). The party having the benefit of a Mortgage shall be referred to
as a "Mortgagee". This clause shall be self-operative, but upon request from a
Mortgagee, Tenant shall execute a commercially reasonable subordination
agreement in favor of the Mortgagee. In lieu of having the Mortgage be superior
to this Lease, a Mortgagee shall have the right at any time to subordinate its
Mortgage to this Lease. If requested by a successor-in-interest to all or a part
of Landlord's interest in the Lease, Tenant shall, without charge, attorn to the
successor-in-interest. Landlord and Tenant shall each, within 10 days after
receipt of a written request from the other, execute and deliver an estoppel
certificate to those parties as are reasonably requested by the other (including
a Mortgagee or prospective purchaser). The estoppel certificate shall include a
statement certifying that this Lease is
25
<PAGE>
unmodified (except as identified in the estoppel certificate) and in full force
and effect, describing the dates to which Rent and other charges have been paid,
representing that, to such party's actual knowledge, there is no default (or
stating the nature of the alleged default) and indicating other matters with
respect to the Lease that may reasonably be requested. Notwithstanding the
foregoing, as a condition precedent to the subordination of this Lease, Landlord
shall be required to provide Tenant with a non-disturbance, subordination and
attornment agreement in favor of Tenant from any Mortgagee who comes into
existence after the Commencement Date. Such non-disturbance, subordination and
attornment agreement in favor of Tenant shall provide that, so long as Tenant is
paying the rent due under the Lease and is not otherwise in default under the
Lease after the expiration of applicable notice and cure periods, its right to
possession and other terms of the Lease shall remain in full force and effect.
Such non-disturbance, subordination and attornment agreement may include
additional time on behalf of the Mortgagee to cure defaults of the Landlord and
provide that (a) neither Mortgagee nor any successor-in-interest shall be bound
by (i) any payment of the Base Rent, Additional Rent, or other sum due hereunder
for more than 1 month in advance (unless actually received by Mortagee), or (ii)
any amendment or modification to the Lease made without the express written
consent of Mortgagee or any successor-in-interest; (b) neither Mortgagee nor any
successor-in-interest will be liable for (i) any act or omission or warranties
of any prior landlord (including Landlord), (ii) the breach of any warranties or
obligations relating to construction of improvements on the property or any
tenant finish work performed or to have been performed by any prior landlord
(including Landlord), or (iii) the return of any security deposit, except to the
extent such deposits have been received by Mortgagee; and (c) neither Mortgagee
nor any successor-in-interest shall be subject to any offsets or defenses which
Tenant might have against any prior landlord (including Landlord). Landlord
represents that as of the date of this Lease, there is no Mortgage encumbering
the Building or the Project.
XXVII. Attorneys' Fees.
If either party institutes a suit against the other for violation of or
to enforce any covenant or condition of this Lease, or if either party
intervenes in any suit in which the other is a party to enforce or protect its
interest or rights, the prevailing party shall be entitled to all of its costs
and expenses, including, without limitation, reasonable attorneys' fees.
XXVIII. Notice.
If a demand, request, approval, consent or notice (collectively referred
to as a "notice") shall or may be given to either party by the other, the notice
shall be in writing and delivered by hand or sent by certified mail with return
receipt requested, or sent by overnight or same day courier service at the
party's respective Notice Address(es) set forth in Article I, except that if
Tenant has vacated the Premises (or if the Notice Address for Tenant is other
than the Premises, and Tenant has vacated such address) without providing
Landlord a new Notice Address, Landlord may serve notice in any manner described
in this Article or in any other manner permitted by Law. Each notice shall be
deemed to have been received or given on the earlier to occur of actual delivery
or the date on which delivery is refused, or, if Tenant has vacated the Premises
or the other Notice Address of Tenant without providing a new Notice Address, 3
Business Days after notice is deposited in the U.S. mail or with a courier
service in the manner described above. Either party may, at any time, change its
Notice Address by giving the other party written notice of the new address in
the manner described in this Article.
26
<PAGE>
XXIX. Excepted Rights.
This Lease does not grant any rights to light or air over or about the
Building or the Project. Landlord excepts and reserves to itself the use of: (1)
roofs, (2) telephone, electrical and janitorial closets, (3) equipment rooms,
Building risers or similar areas, (4) rights to the land and improvements below
the floor of the Premises and the Project, (5) the improvements and air rights
above the Premises and the Project, (6) the improvements and air rights outside
the demising walls of the Premises, and (7) the areas within the Premises used
for the installation of utility lines and other installations serving occupants
of the Building and/or the Project. Notwithstanding any of the foregoing to the
contrary, and subject to the terms of Article IX above and the other terms and
provisions of this Lease, Tenant shall have the right to access the areas
specified in subclauses (1), (2), (3) and (7) above. Landlord has the right to
change the name or address of the Building and/or the Project provided Landlord
provides Tenant with reasonable prior notice thereof and one month's worth of
Tenant's stationary on hand. Landlord also has the right to make such other
changes to the Project, Property and Building as Landlord deems appropriate,
provided the changes do not materially affect Tenant's ability to use the
Premises for the Permitted Use. Landlord shall also have the right (but not the
obligation) to temporarily close the Building and/or the Project if Landlord
reasonably determines that there is an imminent danger of significant damage to
the Building or the Project or of personal injury to Landlord's employees or the
occupants of the Building and/or the Project. The circumstances under which
Landlord may temporarily close the Building and/or the Project shall include,
without limitation, electrical interruptions, hurricanes and civil disturbances.
A closure of the Building and/or the Project under such circumstances shall not
constitute a constructive eviction nor entitle Tenant to an abatement or
reduction of Rent.
XXX. Surrender of Premises.
At the expiration or earlier termination of this Lease or Tenant's right
of possession, Tenant shall remove Tenant's Property (defined in Article XV)
from the Premises, and quit and surrender the Premises to Landlord, broom clean,
and in good order, condition and repair, ordinary wear and tear and damage by
fire or other casualty for which Tenant is not required to make repairs
hereunder excepted. Tenant shall also be required to remove the Required
Removables in accordance with Article VIII. If Tenant fails to remove any of
Tenant's Property within 2 days after the termination of this Lease or of
Tenant's right to possession, Landlord, at Tenant's sole cost and expense, shall
be entitled (but not obligated) to remove and store Tenant's Property. Landlord
shall not be responsible for the value, preservation or safekeeping of Tenant's
Property. Tenant shall pay Landlord, upon demand, the expenses and storage
charges incurred for Tenant's Property. In addition, if Tenant fails to remove
Tenant's Property from the Premises or storage, as the case may be, within 30
days after written notice, Landlord may store, sell or otherwise dispose of such
Tenant's Property in accordance with applicable Law.
XXXI. Miscellaneous.
A. This Lease and the rights and obligations of the parties shall be
interpreted, construed and enforced in accordance with the Laws of the
State of California and Landlord and Tenant hereby irrevocably consent
to the jurisdiction and proper venue of such state. If any term or
provision of this Lease shall to any extent be invalid or
unenforceable, the remainder of this Lease shall not be affected, and
each provision of this Lease shall be valid and enforced to the
fullest extent permitted by Law. The headings and titles to the
Articles and
27
<PAGE>
Sections of this Lease are for convenience only and shall have no
effect on the interpretation of any part of the Lease.
B. Tenant shall not record this Lease or any memorandum without
Landlord's prior written consent.
C. Landlord and Tenant hereby waive any right to trial by jury in any
eviction or forcible entry and detainer action or similar proceeding
based upon or related to the subject matter of this Lease.
D. Whenever a period of time is prescribed for the taking of an action by
Landlord or Tenant, the period of time for the performance of such
action shall be extended by the number of days that the performance is
actually delayed due to strikes, acts of God, shortages of labor or
materials, war, civil disturbances and other causes beyond the
reasonable control of the performing party ("Force Majeure"). However,
events of Force Majeure shall not extend any period of time for the
payment of Rent or other sums payable by either party or any period of
time for the written exercise of an option or right by either party.
E. Landlord shall have the right to transfer and assign, in whole or in
part, all of its rights and obligations under this Lease and in the
Project, Building and/or Property referred to herein, and upon such
transfer Landlord shall be released from any further obligations
hereunder, and Tenant agrees to look solely to the successor in
interest of Landlord for the performance of such obligations.
Notwithstanding the foregoing, unless such liability is assumed in
writing by its successor in interest hereunder, Landlord shall remain
liable after its period of ownership with respect to any sums due in
connection with a breach or default that arose during such period of
ownership.
F. Tenant represents that it has dealt directly with and only with the
Broker as a broker in connection with this Lease. Tenant shall
indemnify and hold Landlord and the Landlord Related Parties harmless
from all claims of any other brokers claiming to have represented
Tenant in connection with this Lease. Landlord agrees to indemnify and
hold Tenant and the Tenant Related Parties harmless from all claims of
any brokers claiming to have represented Landlord in connection with
this Lease.
G. Tenant covenants, warrants and represents that: (1) each individual
executing, attesting and/or delivering this Lease on behalf of Tenant
is authorized to do so on behalf of Tenant; (2) this Lease is binding
upon Tenant; and (3) Tenant is duly organized and legally existing in
the state of its organization and is qualified to do business in the
State of California. If there is more than one Tenant, or if Tenant is
comprised of more than one party or entity, the obligations imposed
upon Tenant shall be joint and several obligations of all the parties
and entities. Notices, payments and agreements given or made by, with
or to any one person or entity shall be deemed to have been given or
made by, with and to all of them.
H. Time is of the essence with respect to Tenant's exercise of any
expansion, renewal or extension rights granted to Tenant. This Lease
shall create only the relationship of landlord and tenant between the
parties, and not a partnership, joint venture or any other
relationship. This Lease and the covenants and
28
<PAGE>
conditions in this Lease shall inure only to the benefit of and be
binding only upon Landlord and Tenant and their permitted successors
and assigns.
I. The expiration of the Term, whether by lapse of time or otherwise,
shall not relieve either party of any obligations which accrued prior
to or which may continue to accrue after the expiration or early
termination of this Lease. Without limiting the scope of the prior
sentence, it is agreed that Tenant's obligations under Articles IV,
VIII, XIV, XX, XXV and XXX shall survive the expiration or early
termination of this Lease.
J. Landlord has delivered a copy of this Lease to Tenant for Tenant's
review only, and the delivery of it does not constitute an offer to
Tenant or an option. This Lease shall not be effective against any
party hereto until an original copy of this Lease has been signed by
such party.
K. All understandings and agreements previously made between the parties
are superseded by this Lease, and neither party is relying upon any
warranty, statement or representation not contained in this Lease.
This Lease may be modified only by a written agreement signed by
Landlord and Tenant.
L. Tenant, within 15 days after request, shall provide Landlord with a
current financial statement and such other information as Landlord may
reasonably request in order to create a "business profile" of Tenant
and determine Tenant's ability to fulfill its obligations under this
Lease. If Tenant is a publicly traded company, such information shall
be limited to Tenant's last annual report and Tenant's 2 most recent
quarterly filings with the Securities and Exchange Commission.
Landlord, however, shall not require Tenant to provide such
information unless Landlord is requested to produce the information in
connection with a proposed financing or sale of the Building. Upon
written request by Tenant, Landlord shall enter into a commercially
reasonable confidentiality agreement covering any confidential
information that is disclosed by Tenant.
M. This Lease shall be subject to the terms and conditions of (a)
Declaration Of Covenants, Conditions And Restrictions Of Shoreline
Technology Park ("Declaration") imposing certain covenants, conditions
and restrictions on the use and management of Shoreline Technology
Park, (b) the Bylaws ("Bylaws") of Shoreline Park Association
("Association"), a California nonprofit mutual benefit corporation
charged with the responsibility of managing Shoreline Technology Park
in accordance with the Declaration, Articles Of Incorporation of the
Association ("Articles") and the Bylaws, and (c) the rules ("Rules")
adopted from time to time by the Association in accordance with the
Declaration providing for restrictions on the use of Shoreline
Technology Park. The Declaration, Bylaws, Articles and Rules are
collectively referred to herein as the "Governing Documents". Any
failure to comply with the Governing Documents (after the expiration
of the applicable notice and cure period hereunder) by Tenant shall be
a default under the terms of this Lease.
N. Except with regard to requests for consent or approval that require
Landlord to make a determination of the aesthetics of certain signage,
alterations or other things that would be visible from outside the
Premises or Building or to assume
29
<PAGE>
certain risks, including, without limitation, the risk that a certain
alteration, addition and/or improvement could adversely affect the
mechanical systems or structure of the Building or require excess
removal costs, Landlord and Tenant agree to act reasonably in granting
approval or disapproval of any requests by the other for consent or
approval.
XXXII. Entire Agreement.
This Lease and the following exhibits and attachments constitute the
entire agreement between the parties and supersede all prior agreements and
understandings related to the Premises, including all lease proposals, letters
of intent and other documents: Exhibit A-1 (Outline and Location of Premises),
Exhibit A-2 (Outline and Location of Project), Exhibit A-3 (Outline and Location
of Recreational Area), Exhibit B (Rules and Regulations), Exhibit C
(Commencement Letter), Exhibit D (Work Letter Agreement), Exhibit E (Additional
Provisions), Exhibit F (Parking Agreement) and Exhibit G (Form of Letter of
Credit).
30
<PAGE>
Landlord and Tenant have executed this Lease as of the day and year first
above written.
LANDLORD:
EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company
By: EOP Operating Limited Partnership, a
Delaware limited partnership, its sole
member
By: Equity Office Properties Trust, a
Maryland real estate investment
trust, its managing general
partner
By: /s/ Peter H. Adams
--------------------------
Name: Peter H. Adams
------------------------
Title: Senior Vice President
-----------------------
TENANT:
E-STAMP CORPORATION, a Delaware corporation
By: /s/ Robert H. Ewald
-----------------------------
Name: Robert H. Ewald
---------------------------
Title: Pres and CEO
--------------------------
By: /s/ Anthony Lewis
-----------------------------
Name: Anthony Lewis
---------------------------
Title: VP CFO
--------------------------
31
<PAGE>
EXHIBIT A-1
OUTLINE AND LOCATION OF PREMISES
--------------------------------
This Exhibit is attached to and made a part of the Lease dated as of
_____________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company ("Landlord") and E-STAMP CORPORATION, a
Delaware corporation ("Tenant") for space in the Building located at 2051
Stierlin Court, Mountain View, California.
<PAGE>
EXHIBIT A-2
OUTLINE AND LOCATION OF PROJECT
-------------------------------
This Exhibit is attached to and made a part of the Lease dated as of
_____________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company ("Landlord") and E-STAMP CORPORATION, a
Delaware corporation ("Tenant") for space in the Building located at 2051
Stierlin Court, Mountain View, California.
<PAGE>
EXHIBIT A-3
OUTLINE AND LOCATION OF RECREATIONAL AREA
-----------------------------------------
This Exhibit is attached to and made a part of the Lease dated as of
_____________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company ("Landlord") and E-STAMP CORPORATION, a
Delaware corporation ("Tenant") for space in the Building located at 2051
Stierlin Court, Mountain View, California.
<PAGE>
EXHIBIT B
BUILDING RULES AND REGULATIONS
------------------------------
The following rules and regulations shall apply, where applicable, to the
Premises, the Building, the parking garage (if any), the Property, the Project
and the appurtenances. Capitalized terms have the same meaning as defined in
the Lease.
1. Sidewalks, doorways, vestibules, halls, stairways and other similar areas
shall not be obstructed by Tenant or used by Tenant for any purpose other
than ingress and egress to and from the Premises. No rubbish, litter,
trash, or material shall be placed, emptied, or thrown in those areas. At
no time shall Tenant permit Tenant's employees to loiter in Common Areas or
elsewhere about the Property or Project.
2. Plumbing fixtures and appliances shall be used only for the purposes for
which designed, and no sweepings, rubbish, rags or other unsuitable
material shall be thrown or placed in the fixtures or appliances. Damage
resulting to fixtures or appliances by Tenant, its agents, employees or
invitees, shall be paid for by Tenant, and Landlord shall not be
responsible for the damage.
3. No signs, advertisements or notices shall be painted or affixed to windows,
doors or other parts of the Building or Project, except those of such
color, size, style and in such places as are first approved in writing by
Landlord. Except in connection with the hanging of lightweight pictures
and wall decorations, no nails, hooks or screws shall be inserted into any
part of the Premises, Building or Project except by Landlord's maintenance
personnel.
4. No directory listing tenants or employees shall be permitted unless
previously consented to by Landlord in writing.
5. Tenant shall not place any lock(s) on any door in the Premises, Building or
Project (other than the Secured Area, as defined in Article XI of the
Lease) without Landlord's prior written consent and Landlord shall have the
right to retain at all times and to use keys to all locks within and into
the Premises. All keys shall be returned to Landlord at the expiration or
early termination of this Lease.
6. All contractors, contractor's representatives and installation technicians
performing work in the Building and/or the Project shall be subject to
Landlord's prior approval and shall be required to comply with Landlord's
standard rules, regulations, policies and procedures, which may be revised
from time to time.
7. Movement in or out of the Building or the Project of furniture or office
equipment, or dispatch or receipt by Tenant of merchandise or materials
requiring the use of elevators, stairways, lobby areas or loading dock
areas, shall be restricted to hours designated by Landlord. Tenant shall
obtain Landlord's prior approval by providing a detailed listing of the
activity. If approved by Landlord, the activity shall be under the
reasonable supervision of Landlord and performed in the manner reasonably
required by Landlord. Tenant shall assume all risk for damage to articles
moved and injury to any persons resulting from the activity. If equipment,
property, or personnel of Landlord or of any other party is damaged or
injured as a result of or in connection with the activity, Tenant shall be
solely liable for any resulting damage or loss.
<PAGE>
8. Landlord shall have the right to approve the weight, size, or location of
heavy equipment or articles in and about the Premises. Damage to the
Building and/or Project by the installation, maintenance, operation,
existence or removal of Tenant's Property shall be repaired at Tenant's
sole expense.
9. Tenant shall not: (1) make or permit any improper, objectionable or
unpleasant noises or odors in the Project, or otherwise interfere in any
way with other tenants or persons having business with them; (2) solicit
business or distribute, or cause to be distributed, in any portion of the
Project, handbills, promotional materials or other advertising; or (3)
conduct or permit other activities in the Building or Project that might,
in Landlord's sole opinion, constitute a nuisance.
10. No animals, except those assisting handicapped persons, and no aquariums
shall be brought into the Building or the Project or kept in or about the
Premises.
11. No inflammable, explosive or dangerous fluids or substances shall be used
or kept by Tenant in the Premises, Building, Project or about the Property.
Tenant shall not, without Landlord's prior written consent, use, store,
install, spill, remove, release or dispose of, within or about the Premises
or any other portion of the Property or Project, any asbestos-containing
materials or any solid, liquid or gaseous material now or subsequently
considered toxic or hazardous under the provisions of 42 U.S.C. Section
9601 et seq. or any other applicable environmental Law which may now or
later be in effect. Tenant shall comply with all Laws pertaining to and
governing the use of these materials by Tenant, and shall remain solely
liable for the costs of abatement and removal.
12. Tenant shall not use or occupy the Premises in any manner or for any
purpose which might injure the reputation or impair the present or future
value of the Premises or the Building or the Project. Tenant shall not
use, or permit any part of the Premises to be used, for lodging, sleeping
or for any illegal purpose.
13. Tenant shall not take any action which would violate Landlord's labor
contracts or which would cause a work stoppage, picketing, labor disruption
or dispute, or interfere with Landlord's or any other tenant's or
occupant's business or with the rights and privileges of any person
lawfully in the Building and/or the Project ("Labor Disruption"). Tenant
shall take the actions necessary to resolve the Labor Disruption, and shall
have pickets removed and, at the request of Landlord, immediately terminate
any work in the Premises that gave rise to the Labor Disruption, until
Landlord gives its written consent for the work to resume. Tenant shall
have no claim for damages against Landlord or any of the Landlord Related
Parties, nor shall the Commencement Date of the Term be extended as a
result of the above actions.
14. Tenant shall not install, operate or maintain in the Premises or in any
other area of the Building or the Project, electrical equipment that would
overload the electrical system beyond its capacity for proper, efficient
and safe operation as determined solely by Landlord. Tenant shall not
furnish cooling or heating to the Premises, including, without limitation,
the use of electronic or gas heating devices, without Landlord's prior
written consent. Tenant shall not use more than its proportionate share of
telephone lines and other telecommunication facilities available to service
the Building and/or the Project.
<PAGE>
15. Tenant shall not operate or permit to be operated a coin or token operated
vending machine or similar device (including, without limitation,
telephones, lockers, toilets, scales, amusement devices and machines for
sale of beverages, foods, candy, cigarettes and other goods), except for
machines for the exclusive use of Tenant's employees, and then only if the
operation does not violate the lease of any other tenant in the Building or
the Project.
16. Bicycles and other vehicles are not permitted or on the walkways outside
the Building, except in areas designated by Landlord.
17. Landlord may from time to time adopt systems and procedures for the
security and safety of the Building, the Project and their occupants,
entry, use and contents. Tenant, its agents, employees, contractors,
guests and invitees shall comply with Landlord's systems and procedures.
18. Landlord shall have the right to prohibit the use of the name of the
Building and/or the Project or any other publicity by Tenant that in
Landlord's sole opinion may impair the reputation of the Building and/or
the Project or their desirability. Upon written notice from Landlord,
Tenant shall refrain from and discontinue such publicity immediately.
19. Tenant shall not canvass, solicit or peddle in or about the Building, the
Property or the Project.
20. Neither Tenant nor its agents, employees, contractors, guests or invitees
shall smoke or permit smoking in the Common Areas, unless the Common Areas
have been declared a designated smoking area by Landlord, nor shall the
above parties allow smoke from the Premises to emanate into the Common
Areas or any other part of the Building or Project. Landlord shall have
the right to designate the Building (including the Premises) and/or the
Project as a non-smoking building or area.
21. Landlord shall have the right to designate and approve standard window
coverings for the Premises and to establish rules to assure that the
Building and Project present a uniform exterior appearance. Tenant shall
ensure, to the extent reasonably practicable, that window coverings are
closed on windows in the Premises while they are exposed to the direct rays
of the sun.
22. Deliveries to and from the Premises shall be made only at the times, in the
areas and through the entrances and exits designated by Landlord. Tenant
shall not make deliveries to or from the Premises in a manner that might
interfere with the use by any other tenant of its premises or of the Common
Areas, any pedestrian use, or any use which is inconsistent with good
business practice.
23. In the event Landlord elects to provide janitorial service to the Premises
in accordance with Article IX.A. of the Lease, the work of cleaning
personnel shall not be hindered by Tenant after 5:30 p.m., and cleaning
work may be done at any time when the offices are vacant. Windows, doors
and fixtures may be cleaned at any time. Tenant shall provide adequate
waste and rubbish receptacles to prevent unreasonable hardship to the
cleaning service.
<PAGE>
EXHIBIT C
COMMENCEMENT LETTER
-------------------
(EXAMPLE)
Date ______________________
Tenant ______________________
Address ______________________
______________________
______________________
Re: Commencement Letter with respect to that certain Lease dated as of
___________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company, as Landlord, and E-STAMP CORPORATION, a
Delaware corporation, as Tenant, for 92,256 rentable square feet in the
Building located at 2051 Stierlin Court, Mountain View, California.
Dear __________________:
In accordance with the terms and conditions of the above referenced Lease,
Tenant accepts possession of the Premises and agrees:
1. The Commencement Date of the Lease is ___________________________;
2. The Termination Date of the Lease is ____________________________.
Please acknowledge your acceptance of possession and agreement to the terms
set forth above by signing all 3 counterparts of this Commencement Letter in the
space provided and returning 2 fully executed counterparts to my attention.
Sincerely,
________________________________
Property Manager
Agreed and Accepted:
Tenant: ______________________
By: ______________________
Name: ______________________
Title: ______________________
Date: ______________________
<PAGE>
EXHIBIT D
WORK LETTER
-----------
This Exhibit is attached to and made a part of the Lease dated as of
_____________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company ("Landlord") and E-STAMP CORPORATION, a
Delaware corporation ("Tenant") for space in the Building located at 2051
Stierlin Court, Mountain View, California.
I. Alterations and Allowance.
-------------------------
A. Tenant, following the delivery of the Premises by Landlord and the
full and final execution and delivery of this Lease and all prepaid
rental and security deposits required hereunder, shall have the right
to perform alterations and improvements in the Premises (the "Initial
Alterations"). Notwithstanding the foregoing, Tenant and its
contractors shall not have the right to perform Initial Alterations in
the Premises unless and until Tenant has complied with all of the
terms and conditions of Article IX.C. of this Lease, including,
without limitation, approval by Landlord of the final plans for the
Initial Alterations and the contractors to be retained by Tenant to
perform such Initial Alterations. Landlord shall advise Tenant in
writing within 5 Business Days after Landlord's receipt of Tenant's
plans as to whether Landlord approves or disapproves of Tenant's
plans. Tenant shall deliver the plans to Landlord in accordance with
Article XXVIII of this Lease. Notwithstanding the provisions of
Article I.D. of this Lease to the contrary, the Abatement Period shall
be extended 1 day for each day the "substantial completion of the
Initial Alterations" (as that term is defined below), is delayed
solely as a result of a "Landlord Caused Delay". For purposes of this
Exhibit D, a "Landlord Caused Delay" shall mean only an actual delay
resulting from the failure of Landlord to timely approve or disapprove
Tenant's plans for the Initial Alterations. For purposes of this
Exhibit D, "substantial completion of the Initial Alterations" shall
mean completion of construction of the Initial Alterations in the
Premises pursuant to the final plans approved by Landlord with the
exception of any punch list items, any furniture, fixtures, work-
stations, built-in furniture or equipment (even if the same requires
installation or electrification by Tenant's agents). If the Landlord
timely disapproves such plans, then within 2 Business Days after
Tenant's receipt of such disapproval, Tenant shall cause the
applicable plans to be revised to correct any such problems identified
by Landlord that Landlord may reasonably require. Tenant shall be
responsible for all elements of the design of Tenant's plans
(including, without limitation, compliance with law, functionality of
design, the structural integrity of the design, the configuration of
the premises and the placement of Tenant's furniture, appliances and
equipment), and Landlord's approval of Tenant's plans shall in no
event relieve Tenant of the responsibility for such design. Tenant
may choose the general contractor that shall perform the Initial
Alterations in the Premises, subject to Landlord's approval.
Landlord's approval of the contractors to perform the Initial
Alterations shall not be unreasonably withheld. The parties agree
that Landlord's approval of the general contractor to perform the
Initial Alterations shall not be considered to be unreasonably
withheld if any such general contractor (i) does not have trade
references reasonably acceptable to Landlord, (ii) does not maintain
insurance as required pursuant to the terms of this Lease,
<PAGE>
(iii) does not have the ability to be bonded for the work in an amount
of no less than $1,000,000.00, (iv) does not provide current financial
statements reasonably acceptable to Landlord, or (v) is not licensed
as a contractor in the state/municipality in which the Premises is
located. Tenant acknowledges the foregoing is not intended to be an
exclusive list of the reasons why Landlord may reasonably withhold its
consent to a general contractor.
B. Provided Tenant is not in default beyond any applicable notice and
cure periods, Landlord agrees to contribute the sum of $461,280.00
(i.e., $5.00 per rentable square foot of the Premises) (the
"Allowance") toward the cost of performing the Initial Alterations in
preparation of Tenant's occupancy of the Premises. Landlord shall be
entitled to deduct from the Allowance a construction management fee
for Landlord's oversight of the Initial Alterations in an amount equal
to $46,128.00. The Allowance may only be used for the cost of
preparing design and construction documents and mechanical and
electrical plans for the Initial Alterations, permitting costs,
project management fees and for hard costs in connection with the
Initial Alterations. The Allowance shall be paid to Tenant within 30
days following receipt by Landlord of (1) receipted bills covering all
labor and materials expended and used in the Initial Alterations; (2)
a sworn contractor's affidavit from the general contractor and a
request to disburse from Tenant containing an approval by Tenant of
the work done; (3) full and final waivers of lien; (4) as-built plans
of the Initial Alterations; and (5) the certification of Tenant and
its architect that the Initial Alterations have been installed in a
good and workmanlike manner in accordance with the approved plans, and
in accordance with applicable laws, codes and ordinances. The
Allowance shall be disbursed in the amount reflected on the receipted
bills meeting the requirements above. Notwithstanding anything herein
to the contrary, Landlord shall not be obligated to disburse any
portion of the Allowance during the continuance of an uncured default
under the Lease, and Landlord's obligation to disburse shall only
resume when and if such default is cured.
C. In no event shall the Allowance be used for the purchase of equipment,
furniture or other items of personal property of Tenant. In the event
Tenant does not use the entire Allowance by the date which is 6 months
after the Commencement Date, any unused amount shall accrue to the
sole benefit of Landlord, it being understood that Tenant shall not be
entitled to any credit, abatement or other concession in connection
therewith. Tenant shall be responsible for all applicable state sales
or use taxes, if any, payable in connection with the Initial
Alterations and/or Allowance.
D. Except as expressly set forth in the Lease, Tenant agrees to accept
the Premises in its "as-is" condition and configuration, it being
agreed that Landlord shall not be required to perform any work or,
except as provided above with respect to the Allowance, incur any
costs in connection with the construction or demolition of any
improvements in the Premises.
E. This Exhibit D shall not be deemed applicable to any additional space
added to the original Premises at any time or from time to time,
whether by any options under the Lease or otherwise, or to any portion
of the original Premises or any additions to the Premises in the event
of a renewal or extension of the original
<PAGE>
Term of this Lease, whether by any options under the Lease or
otherwise, unless expressly so provided in the Lease or any amendment
or supplement to the Lease.
Landlord and Tenant have executed this Exhibit as of the day and year first
above written.
LANDLORD:
EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company
By: EOP Operating Limited Partnership, a
Delaware limited partnership, its
sole member
By: Equity Office Properties Trust,
a Maryland real estate
investment trust, its managing
general partner
By: _______________________
Name: _______________________
Title: _______________________
TENANT:
E-STAMP CORPORATION, a Delaware corporation
By: _____________________________
Name: _____________________________
Title: _____________________________
By: _____________________________
Name: _____________________________
Title: _____________________________
<PAGE>
EXHIBIT E
ADDITIONAL PROVISIONS
---------------------
This Exhibit is attached to and made a part of the Lease dated as of
_____________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company ("Landlord") and E-STAMP CORPORATION, a
Delaware corporation ("Tenant") for space in the Building located at 2051
Stierlin Court, Mountain View, California.
I. HAZARDOUS MATERIALS. Landlord shall indemnify, defend, protect, save, hold
harmless, and reimburse Tenant, its partners, officers, directors and
employees for, from and against any and all costs, losses, liabilities,
damages, assessments, lawsuits, deficiencies, demands, claims and expenses
incurred in connection with, arising out of, resulting from or incident to,
the production, use, generation, storage, treatment, disposal, discharge,
release or other handling or disposition of any Hazardous Materials
(defined below) on or about the Project by Landlord, its officers,
employees, agents and/or independent contractors, including, without
limitation, the effects of handling of any Hazardous Materials on any
person or property within or outside the boundaries of the Project; but
excluding from the foregoing indemnity, Tenant's negligence or the handling
by Tenant during Tenant's occupancy of the Premises of any Permitted
Materials (as hereinafter defined) and/or Hazardous Materials on or about
the Project at levels which pose a risk to persons located on or about the
Project, and which prompt the initiation of a removal, response, remedial
or other action by a governmental agency or authority possessing and
exercising jurisdiction over the Project. Tenant shall not use, generate,
manufacture, store or dispose of, on or about the Premises, or transport to
or from the Premises, any flammable explosives, radioactive materials,
hazardous wastes, toxic substances, or any related materials or substances,
including, without limitation, any substance defined as or included in the
definition of "hazardous substances" under any applicable federal, state or
local law, regulation or ordinance (collectively, "Hazardous Materials").
Tenant shall indemnify, defend, protect, save, hold harmless, and reimburse
Landlord, its partners, officers, directors and employees for, from and
against any and all costs, losses, liabilities, damages, assessments,
lawsuits, deficiencies, demands, claims and expenses incurred in connection
with, arising out of, resulting from or incident to, the production, use,
generation, storage, treatment, disposal, discharge, release or other
handling or disposition of any Hazardous Materials on or about the Project
by Tenant, its officers, employees, agents and/or independent contractors,
including, without limitation, the effects of such handling of any
Hazardous Materials on any person or property within or outside the
boundaries of the Project; but excluding from the foregoing indemnity,
Landlord's negligence or the handling by Landlord of any Permitted
Materials and/or Hazardous Materials on or about the Project at levels
which pose a risk to persons located on or about the Project, and which
prompt the initiation of a removal, response, remedial or other action by a
governmental agency or authority possessing and exercising jurisdiction
over the Project. Notwithstanding the provisions of this section, Tenant
and Landlord shall have the right to use, generate and store on the
Premises and the Building, and transport to and from the Premises and the
Building, those Hazardous Materials which are generally used in the
ordinary course in first class office buildings (collectively, "Permitted
Materials"); provided, however, that Tenant's use, generation, storage and
transport thereof is in compliance with all applicable federal, state and
local laws, regulations and ordinances and any manufacturers' instructions.
<PAGE>
II. SATELLITE DISH.
A. Tenant shall have the right to lease space on the roof of the Building
for the purpose of installing (in accordance with Section IX.C of the
Lease), operating and maintaining a 36 inch dish/antenna or other
communication device approved by the Landlord (the "Dish/Antenna").
The exact location of the space on the roof to be leased by Tenant
shall be designated by Landlord and shall not exceed 9 square feet
(the "Roof Space"). Landlord reserves the right to relocate the Roof
Space as reasonably necessary during the Term. Landlord's designation
shall take into account Tenant's use of the Dish/Antenna.
Notwithstanding the foregoing, Tenant's right to install the
Dish/Antenna shall be subject to the approval rights of Landlord and
Landlord's architect and/or engineer with respect to the plans and
specifications of the Dish/Antenna, the manner in which the
Dish/Antenna is attached to the roof of the Building and the manner in
which any cables are run to and from the Dish/Antenna. The precise
specifications and a general description of the Dish/Antenna along
with all documents Landlord reasonably requires to review the
installation of the Dish/Antenna (the "Plans and Specifications")
shall be submitted to Landlord for Landlord's written approval no
later than 20 days before Tenant commences to install the
Dish/Antenna. Tenant shall be solely responsible for obtaining all
necessary governmental and regulatory approvals and for the cost of
installing, operating, maintaining and removing the Dish/Antenna.
Tenant shall notify Landlord upon completion of the installation of
the Dish/Antenna. If Landlord determines that the Dish/Antenna
equipment does not comply with the approved Plans and Specifications,
that the Building has been damaged during installation of the
Dish/Antenna or that the installation was defective, Landlord shall
notify Tenant of any noncompliance or detected problems and Tenant
immediately shall cure the defects. If the Tenant fails to
immediately cure the defects, Tenant shall pay to Landlord upon demand
the cost, as reasonably determined by Landlord, of correcting any
defects and repairing any damage to the Building caused by such
installation. If at any time Landlord, in its sole discretion, deems
it necessary, Tenant shall provide and install, at Tenant's sole cost
and expense, appropriate aesthetic screening, reasonably satisfactory
to Landlord, for the Dish/Antenna (the "Aesthetic Screening").
B. Landlord agrees that Tenant, upon reasonable prior written notice to
Landlord, shall have access to the roof of the Building and the Roof
Space for the purpose of installing, maintaining, repairing and
removing the Dish/Antenna, the appurtenances and the Aesthetic
Screening, if any, all of which shall be performed by Tenant or
Tenant's authorized representative or contractors, which shall be
approved by Landlord, at Tenant's sole cost and risk. It is agreed,
however, that only authorized engineers, employees or properly
authorized contractors of Tenant, FCC inspectors, or persons under
their direct supervision will be permitted to have access to the roof
of the Building and the Roof Space. Tenant further agrees to exercise
firm control over the people requiring access to the roof of the
Building and the Roof Space in order to keep to a minimum the number
of people having access to the roof of the Building and the Roof Space
and the frequency of their visits.
<PAGE>
C. It is further understood and agreed that the installation,
maintenance, operation and removal of the Dish/Antenna, the
appurtenances and the Aesthetic Screening, if any, is not permitted to
damage the Building or the roof thereof, or interfere with the use of
the Building and roof by Landlord. Tenant agrees to be responsible
for any damage caused to the roof or any other part of the Building,
which may be caused by Tenant or any of its agents or representatives.
D. Tenant agrees to install only equipment of types and frequencies which
will not cause unreasonable interference to Landlord or existing
tenants of the Project. In the event Tenant's equipment causes such
interference, Tenant will change the frequency on which it transmits
and/or receives and take any other steps necessary to eliminate the
interference. If said interference cannot be eliminated within a
reasonable period of time, in the judgment of Landlord, then Tenant
agrees to remove the Dish/Antenna from the Roof Space.
E. Tenant shall, at its sole cost and expense, and at its sole risk,
install, operate and maintain the Dish/Antenna in a good and
workmanlike manner, and in compliance with all Building, electric,
communication, and safety codes, ordinances, standards, regulations
and requirements, now in effect or hereafter promulgated, of the
Federal Government, including, without limitation, the Federal
Communications Commission (the "FCC"), the Federal Aviation
Administration ("FAA") or any successor agency of either the FCC or
FAA having jurisdiction over radio or telecommunications, and of the
state, city and county in which the Building is located. Under this
Lease, the Landlord and its agents assume no responsibility for the
licensing, operation and/or maintenance of Tenant's equipment. Tenant
has the responsibility of carrying out the terms of its FCC license in
all respects. The Dish/Antenna shall be connected to Landlord's power
supply in strict compliance with all applicable Building, electrical,
fire and safety codes. Neither Landlord nor its agents shall be
liable to Tenant for any stoppages or shortages of electrical power
furnished to the Dish/Antenna or the Roof Space because of any act,
omission or requirement of the public utility serving the Building, or
the act or omission of any other tenant, invitee or licensee or their
respective agents, employees or contractors, or for any other cause
beyond the reasonable control of Landlord, and Tenant shall not be
entitled to any rental abatement for any such stoppage or shortage of
electrical power. Neither Landlord nor its agents shall have any
responsibility or liability for the conduct or safety of any of
Tenant's representatives, repair, maintenance and engineering
personnel while in or on any part of the Building or the Roof Space.
F. The Dish/Antenna, the appurtenances and the Aesthetic Screening, if
any, shall remain the personal property of Tenant, and shall be
removed by Tenant at its own expense at the expiration or earlier
termination of this Lease or Tenant's right to possession hereunder.
Tenant shall repair any damage caused by such removal, including the
patching of any holes to match, as closely as possible, the color
surrounding the area where the equipment and appurtenances were
attached. Tenant agrees to maintain all of the Tenant's equipment
placed on or about the roof or in any other part of the Building in
proper operating condition and maintain same in satisfactory condition
as to appearance and safety in Landlord's sole discretion. Such
maintenance and operation shall be performed in a manner to avoid any
interference with any other tenants or Landlord.
<PAGE>
Tenant agrees that at all times during the Term, it will keep the roof
of the Building and the Roof Space free of all trash or waste
materials produced by Tenant or Tenant's agents, employees or
contractors.
G. In light of the specialized nature of the Dish/Antenna, Tenant shall
be permitted to utilize the services of its choice for installation,
operation, removal and repair of the Dish/Antenna, the appurtenances
and the Aesthetic Screening, if any, subject to the reasonable
approval of Landlord. Notwithstanding the foregoing, Tenant must
provide Landlord with prior written notice of any such installation,
removal or repair and coordinate such work with Landlord in order to
avoid voiding or otherwise adversely affecting any warranties granted
to Landlord with respect to the roof. If necessary, Tenant, at its
sole cost and expense, shall retain any contractor having a then
existing warranty in effect on the roof to perform such work (to the
extent that it involves the roof), or, at Tenant's option, to perform
such work in conjunction with Tenant's contractor. In the event the
Landlord contemplates roof repairs that could affect Tenant's
Dish/Antenna, or which may result in an interruption of the Tenant's
telecommunication service, Landlord shall formally notify Tenant at
least 30 days in advance (except in cases of an emergency) prior to
the commencement of such contemplated work in order to allow Tenant to
make other arrangements for such service.
H. Tenant shall not allow any provider of telecommunication, video, data
or related services ("Communication Services") to locate any equipment
on the roof of the Building or in the Roof Space for any purpose
whatsoever, nor may Tenant use the Roof Space and/or Dish/Antenna to
provide Communication Services to an unaffiliated tenant, occupant or
licensee of another building, or to facilitate the provision of
Communication Services on behalf of another Communication Services
provider to an unaffiliated tenant, occupant or licensee of the
Building or any other building.
I. Tenant acknowledges that Landlord may at some time establish a
standard license agreement (the "License Agreement") with respect to
the use of roof space by tenants of the Project. Tenant, upon request
of Landlord, shall enter into such License Agreement with Landlord
provided that such agreement does not materially alter the rights of
Tenant hereunder with respect to the Roof Space.
J. Tenant specifically acknowledges and agrees that the terms and
conditions of Article XIV of the Lease (Indemnity and Waiver of
Claims) shall apply with full force and effect to the Roof Space and
any other portions of the roof accessed or utilized by Tenant, its
representatives, agents, employees or contractors.
K. If Tenant defaults under any of the terms and conditions of this
Section or the Lease, and Tenant fails to cure said default within the
time allowed by Article XX of the Lease, Landlord shall be permitted
to exercise all remedies provided under the terms of the Lease,
including removing the Dish/Antenna, the appurtenances and the
Aesthetic Screening, if any, and restoring the Building and the Roof
Space to the condition that existed prior to the installation of the
Dish/Antenna, the appurtenances and the Aesthetic Screening, if any.
If Landlord removes the Dish/Antenna, the appurtenances and the
Aesthetic Screening, if any, as a result of an uncured default, Tenant
shall be liable for all costs and expenses Landlord
<PAGE>
incurs in removing the Dish/Antenna, the appurtenances and the
Aesthetic Screening, if any, and repairing any damage to the Building,
the roof of the Building and the Roof Space caused by the
installation, operation or maintenance of the Dish/Antenna, the
appurtenances, and the Aesthetic Screening, if any.
Landlord and Tenant have executed this Exhibit as of the day and year first
above written.
LANDLORD
EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company
By: EOP Operating Limited Partnership, a
Delaware limited partnership, its
sole member
By: Equity Office Properties Trust,
a Maryland real estate
investment trust, its managing
general partner
By: _________________________
Name: _________________________
Title: _________________________
TENANT:
E-STAMP CORPORATION, a Delaware corporation
By: _____________________________
Name: _____________________________
Title: _____________________________
By: _____________________________
Name: _____________________________
Title: _____________________________
<PAGE>
EXHIBIT F
PARKING AGREEMENT
-----------------
This Exhibit is attached to and made a part of the Lease dated as of
_____________, 2000, by and between EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company ("Landlord") and E-STAMP CORPORATION, a
Delaware corporation ("Tenant") for space in the Building located at 2051
Stierlin Court, Mountain View, California.
1. Landlord hereby grants to Tenant and persons designated by Tenant a license
to use 341 non-priority parking spaces in the parking areas ("Parking
Facility") servicing the Building. The term of such license shall commence
on the Commencement Date under the Lease and shall continue until the
earlier to occur of the Termination Date under the Lease, or the sooner
termination of the Lease. During the term of this license, Tenant shall
pay Landlord $0.00 per non-priority parking space, per month. No
deductions from the monthly charge shall be made for days on which the
Parking Facility is not used by Tenant. Tenant may, from time to time
request additional parking spaces, and if Landlord shall provide the same,
such parking spaces shall be provided and used on a month-to-month basis,
and otherwise on the foregoing terms and provisions, and at such prevailing
monthly parking charges as shall be established from time to time.
2. Tenant shall at all times comply with all applicable ordinances, rules,
regulations, codes, laws, statutes and requirements of all federal, state,
county and municipal governmental bodies or their subdivisions respecting
the use of the Parking Facility. Landlord reserves the right to adopt,
modify and enforce reasonable rules ("Rules") governing the use of the
Parking Facility from time to time including any key-card, sticker or other
identification or entrance system and hours of operation. The rules set
forth herein are currently in effect. Landlord may refuse to permit any
person who violates such rules to park in the Parking Facility, and any
violation of the rules shall subject the car to removal from the Parking
Facility.
3. Unless specified to the contrary above, the parking spaces hereunder shall
be provided on a non-designated "first-come, first-served" basis. Tenant
acknowledges that Landlord has no liability for claims arising through acts
or omissions of any Operator (as hereinafter defined) of the Parking
Facility, if any. Landlord shall have no liability whatsoever for any
damage to items located in the Parking Facility, nor for any personal
injuries or death arising out of any matter relating to the Parking
Facility, and in all events, Tenant agrees to look first to its insurance
carrier and to require that Tenant's employees look first to their
respective insurance carriers for payment of any losses sustained in
connection with any use of the Parking Facility. Tenant hereby waives on
behalf of its insurance carriers all rights of subrogation against Landlord
or Landlord's agents. Landlord reserves the right to assign specific
parking spaces, and to reserve parking spaces for visitors, small cars,
handicapped persons and for other tenants, guests of tenants or other
parties, which assignment and reservation or spaces may be relocated as
determined by Landlord from time to time, and Tenant and persons designated
by Tenant hereunder shall not park in any location designated for such
assigned or reserved parking spaces. Tenant acknowledges that the Parking
Facility may be closed entirely or in part in order to make repairs or
perform maintenance services, or to alter, modify, re-stripe or renovate
the Parking Facility, or if required by casualty, strike, condemnation, act
of God, governmental law or requirement or other reason beyond the
operator's reasonable control.
<PAGE>
4. If Tenant shall default under this Parking Agreement after the expiration
of applicable notice and cure periods, the Landlord or the Operator, as the
case may be, shall have the right to remove from the Parking Facility any
vehicles hereunder which shall have been involved or shall have been owned
or driven by parties involved in causing such default, without liability
therefor whatsoever. In addition, if Tenant shall default under this
Parking Agreement, after expiration of applicable notice and cure periods,
Landlord shall have the right to cancel this Parking Agreement on 10 days'
written notice, unless within such 10 day period, Tenant cures such
default. If Tenant defaults with respect to the same term or condition
under this Parking Agreement more than 3 times during any 12 month period,
and Landlord notifies Tenant thereof promptly after each such default, the
next default of such term or condition during the succeeding 12 month
period, shall, at Landlord's election, constitute an incurable default.
Such cancellation right shall be cumulative and in addition to any other
rights or remedies available to Landlord at law or equity, or provided
under the Lease (all of which rights and remedies under the Lease are
hereby incorporated herein, as though fully set forth). Any default by
Tenant under the Lease shall be a default under this Parking Agreement, and
any default under this Parking Agreement shall be a default under the
Lease.
RULES
(i) Tenant shall have access to the Parking Facility on a 24 hour basis,
7 days a week. Tenant shall not store or permit its employees to
store any automobiles in the Parking Facility without the prior
written consent of the Landlord. Except for emergency repairs, Tenant
and its employees shall not perform any work on any automobiles while
located in the Parking Facility, or on the Property.
(ii) Cars must be parked entirely within the stall lines painted on the
floor, and only small cars may be parked in areas reserved for small
cars.
(iii) All directional signs and arrows must be observed.
(iv) The speed limit shall be 5 miles per hour.
(v) Parking spaces reserved for handicapped persons must be used only by
vehicles properly designated.
(vi) Parking is prohibited in all areas not expressly designated for
parking, including without limitation:
(a) Areas not striped for parking
(b) aisles
(c) where "no parking" signs are posted
(d) ramps
(e) loading zones
(vii) Parking stickers, key cards or any other devices or forms of
identification or entry supplied by the Landlord or the Operator, as
the case may be, shall remain the property of the Landlord or the
Operator. Such device must be displayed as requested and may not be
mutilated in any manner. The serial number of the parking
identification device may not be obliterated. Parking passes and
devices
<PAGE>
are not transferable and any pass or device in the possession of an
unauthorized holder will be void.
(viii) Monthly fees shall be payable in advance prior to the first day of
each month. Failure to do so will automatically cancel parking
privileges and a charge at the prevailing daily parking rate will
be due. No deductions or allowances from the monthly rate will be
made for days on which the Parking Facility is not used by Tenant
or its designees.
(ix) Parking Facility managers or attendants are not authorized to make
or allow any exceptions to these Rules.
(x) Every parker is required to park and lock his/her own car.
(xi) Loss or theft of parking pass, identification, key cards or other
such devices must be reported to Landlord and to the Parking
Facility manager immediately. Any parking devices reported lost or
stolen found on any authorized car will be confiscated and the
illegal holder will be subject to prosecution. Lost or stolen
passes and devices found by Tenant or its employees must be
reported to the office of the garage immediately.
(xii) Washing, waxing, cleaning or servicing of any vehicle by the
customer and/or his agents is prohibited. Parking spaces may be
used only for parking automobiles.
(xiii) By signing this Parking Agreement, Tenant agrees to acquaint all
persons to whom Tenant assigns a parking pass with these Rules.
5. Landlord may elect to provide parking cards or keys to control access to
the Parking Facility or surface parking areas, if any. In such event,
Landlord shall provide Tenant with one card or key for each parking space
that Tenant is entitled to hereunder, provided that Landlord shall have the
right to require Tenant or its employees to place a deposit on such access
cards or keys and to pay a fee for any lost or damaged cards or keys.
6. Landlord hereby reserves the right to enter into a management agreement or
lease with an entity for the Parking Facility ("Operator"). In such event,
Tenant upon request of Landlord, shall enter into a parking agreement with
the Operator and pay the Operator the monthly charge established hereunder,
and Landlord shall have no liability for claims arising through acts or
omissions of the Operator unless caused by Landlord's negligence or willful
misconduct. It is understood and agreed that the identity of the Operator
may change from time to time during the Term. In connection therewith, any
parking lease or agreement entered into between Tenant and an Operator
shall be freely assignable by such Operator or any successors thereto.
7. NO LIABILITY. TENANT ACKNOWLEDGES AND AGREES THAT, TO THE FULLEST EXTENT
PERMITTED BY LAW, LANDLORD SHALL NOT BE RESPONSIBLE FOR ANY LOSS OR DAMAGE
TO TENANT OR TENANT'S PROPERTY (INCLUDING, WITHOUT LIMITATIONS, ANY LOSS OR
DAMAGE TO TENANT'S AUTOMOBILE OR THE CONTENTS THEREOF DUE TO THEFT,
VANDALISM OR ACCIDENT) ARISING FROM OR RELATED TO TENANT'S USE OF THE
PARKING FACILITY OR EXERCISE OF ANY RIGHTS UNDER THIS PARKING AGREEMENT,
WHETHER OR NOT SUCH LOSS OR DAMAGE RESULTS FROM LANDLORD'S ACTIVE
NEGLIGENCE OR NEGLIGENT
<PAGE>
OMISSION. THE LIMITATION ON LANDLORD'S LIABILITY UNDER THE PRECEDING
SENTENCE SHALL NOT APPLY HOWEVER TO LOSS OR DAMAGE ARISING DIRECTLY FROM
LANDLORD'S WILLFUL MISCONDUCT.
8. Release of Liability. Without limiting the provisions of Paragraph 7
above, Tenant hereby voluntarily releases, discharges, waives and
relinquishes any and all actions or causes of action for personal injury or
property damage occurring to Tenant arising as a result of parking in the
Parking Facility, or any activities incidental thereto, wherever or however
the same may occur, and further agrees that Tenant will not prosecute any
claim for personal injury or property damage against Landlord or any of its
officers, agents, servants or employees for any said causes of action. It
is the intention of Tenant by this instrument, to exempt and relieve
Landlord from liability for personal injury or property damage caused by
negligence.
9. The provisions of Article XXI of the Lease are hereby incorporated by
reference as if fully recited.
Tenant acknowledges that Tenant has read the provisions of this Parking
Agreement, has been fully and completely advised of the potential dangers
incidental to parking in the Parking Facility and is fully aware of the legal
consequences of signing this instrument.
<PAGE>
IN WITNESS WHEREOF, Landlord and Tenant have executed this Exhibit as of
the day and year first above written.
LANDLORD:
EOP-SHORELINE TECHNOLOGY PARK, L.L.C., a
Delaware limited liability company
By: EOP Operating Limited Partnership, a
Delaware limited partnership, its
sole member
By: Equity Office Properties Trust,
a Maryland real estate
investment trust, its managing
general partner
By: _________________________
Name: _________________________
Title: _________________________
TENANT:
E-STAMP CORPORATION, a Delaware corporation
By: ______________________________
Name: ______________________________
Title: ______________________________
By: ______________________________
Name: ______________________________
Title: ______________________________
<PAGE>
EXHIBIT G
FORM OF LETTER OF CREDIT
------------------------
_______________________________
[Name of Financial Institution]
Irrevocable Standby
Letter of Credit
No. _______________________
Issuance Date:_____________
Expiration Date:___________
Applicant:_________________
Beneficiary
-----------
EOP-SHORELINE TECHNOLOGY PARK, L.L.C.
Two North Riverside Plaza
Suite 2200
Chicago, Illinois 60606
Ladies/Gentlemen:
We hereby establish our Irrevocable Standby Letter of Credit in your favor
for the account of the above referenced Applicant in the amount of One Million
Two Hundred Thousand and 00/100 U.S. Dollars ($1,200,000.00) available for
payment at sight by your draft drawn on us when accompanied by the following
documents:
1. An original copy of this Irrevocable Standby Letter of Credit.
2. Beneficiary's dated statement purportedly signed by one of its officers
reading: "This draw in the amount of ______________________ U.S. Dollars
($____________) under your Irrevocable Standby Letter of Credit No.
____________________ represents funds due and owing to us as a result of
the Applicant's failure to comply with one or more of the terms of that
certain lease by and between ______________________, as landlord, and
_____________, as tenant."
It is a condition of this Irrevocable Standby Letter of Credit that it will
be considered automatically renewed for a one year period upon the expiration
date set forth above and upon each anniversary of such date, unless at least
sixty (60) days prior to such expiration date or applicable anniversary thereof,
we notify you in writing by certified mail, return receipt requested, that we
elect not to so renew this Irrevocable Standby Letter of Credit. A copy of any
such notice shall also be sent to: Equity Office Properties Trust, 2 North
Riverside Plaza, Suite 2200, Chicago, IL 60606, Attention: Senior Vice
President-Treasurer. In addition, provided that you have not provided us with
written notice of Applicant's default under the above referenced lease prior to
the effective date of any reduction, the amount of this Irrevocable Standby
Letter of Credit shall automatically reduce in accordance with the following
schedule:
Effective Date of Reduction New Reduced Amount of Letter of Credit
<PAGE>
5/th/ Anniversary of the Commencement Date $800,000.00
6/th/ Anniversary of the Commencement Date $400,000.00
In addition to the foregoing, we understand and agree that you shall be entitled
to draw upon this Irrevocable Standby Letter of Credit in accordance with 1. and
2. above in the event that we elect not to renew this Irrevocable Standby Letter
of Credit and, in addition, you provide us with a dated statement proportedly
signed by one of Beneficiary's officers stating that the Applicant has failed to
provide you with an acceptable substitute irrevocable standby letter of credit
in accordance with the terms of the above referenced lease. We further
acknowledge and agree that: (a) upon receipt of the documentation required
herein, we will honor your draws against this Irrevocable Standby Letter of
Credit without inquiry into the accuracy of Beneficiary's signed statement and
regardless of whether Applicant disputes the content of such statement; (b) this
Irrevocable Standby Letter of Credit shall permit partial draws and, in the
event you elect to draw upon less than the full stated amount hereof, the stated
amount of this Irrevocable Standby Letter of Credit shall be automatically
reduced by the amount of such partial draw; and (c) you shall be entitled to
assign your interest in this Irrevocable Standby Letter of Credit from time to
time without our approval and without charge. In the event of an assignment, we
reserve the right to require reasonable evidence of such assignment as a
condition to any draw hereunder.
This Irrevocable Standby Letter of Credit is subject to the Uniform Customs
and Practice for Documentary Credits (1993 revision) ICC Publication No. 500.
We hereby engage with you to honor drafts and documents drawn under and in
compliance with the terms of this Irrevocable Standby Letter of Credit.
All communications to us with respect to this Irrevocable Standby Letter of
Credit must be addressed to our office located at ______________________________
to the attention of __________________________________.
Very truly yours,
______________________
[name]
----------------------
[title]
----------------------
