<PAGE>
As filed with the Securities and Exchange Commission on February 16, 2000
Registration No. 333-95833
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 1
To
FORM S-1
REGISTRATION STATEMENT
Under
The Securities Act of 1933
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iBEAM BROADCASTING CORPORATION
(Exact name of Registrant as specified in its charter)
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Delaware 7389 94-3296895
(State or other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Identification Number)
incorporation or Classification Code
organization) Number)
645 Almanor Avenue, Suite 100
Sunnyvale, CA 94086
(408) 523-1600
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
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Chris Dier
Chief Financial Officer
iBEAM Broadcasting Corporation
645 Almanor Avenue, Suite 100
Sunnyvale, CA 94086
(408) 523-1600
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
Barry Taylor, Esq. Bruce Dallas, Esq.
David Dayan, Esq. Davis Polk & Wardwell
Charles Prober, Esq. 1600 El Camino Real
Wilson Sonsini Goodrich Menlo Park, CA 94025
& Rosati (650) 752-2000
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304
(650) 493-9300
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
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If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the Registration Statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
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<PAGE>
EXPLANATORY NOTE
Amendment No. 1 to the Registration Statement is being filed for the sole
purpose of filing additional exhibits.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by us in connection with the
sale of Common Stock being registered. All amounts are estimates except the
SEC registration fee and the NASD filing fee.
<TABLE>
<S> <C>
SEC registration fee................................................. $ *
NASD filing fee...................................................... *
Nasdaq National Market listing fee................................... *
Printing and engraving costs......................................... *
Legal fees and expenses.............................................. *
Accounting fees and expenses......................................... *
Blue Sky fees and expenses........................................... *
Transfer Agent and Registrar fees.................................... *
Miscellaneous expenses............................................... *
------
Total.............................................................. $ *
======
</TABLE>
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*To be filed by amendment.
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law permits a corporation
to include in its charter documents, and in agreements between the corporation
and its directors and officers, provisions expanding the scope of
indemnification beyond that specifically provided by the current law.
Article X of our Amended and Restated Certificate of Incorporation provides
for the indemnification of directors to the fullest extent permissible under
Delaware law.
Article VI of our Amended and Restated Bylaws provides for the
indemnification of officers, directors and third parties acting on behalf of
us if such person acted in good faith and in a manner reasonably believed to
be in and not opposed to our best interest, and, with respect to any criminal
action or proceeding, the indemnified party had no reason to believe his or
her conduct was unlawful.
We have entered into indemnification agreements with our directors and
executive officers, in addition to indemnification provided for in our Amended
and Restated Bylaws, and intend to enter into indemnification agreements with
any new directors and executive officers in the future. The indemnification
agreements may require us, among other things, to indemnify our directors and
officers against certain liability that may arise by reason of their status or
service as directors and officers (other than liabilities arising from willful
misconduct of a culpable nature), to advance their expenses incurred as a
result of any proceeding against them as to which they could be indemnified,
and to obtain directors and officers' insurance, if available on reasonable
terms.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
Since inception, we have issued unregistered securities to a limited number
of persons, as described below. None of these transactions involved any
underwriters, underwriting discounts or commissions, or any public offering,
and we believe that each transaction was exempt from the registration
requirements of the Securities Act by virtue of Section 4(2) thereof,
Regulation D promulgated thereunder or Rule 701 pursuant to compensatory
benefit plans and contracts relating to compensation as provided under such
Rule 701. The recipients of securities in each such transaction represented
their intention to acquire the securities for investment only and not with a
view to or for sale in connection with any distribution thereof, and
appropriate legends were affixed to the share certificates and instruments
issued in such transactions. All recipients had adequate access, through their
relationships with us, to information about us.
II-1
<PAGE>
(1) Since inception through December 31, 1999, (the most recent practicable
date) we granted stock options to purchase common stock and issued shares of
common stock pursuant to restricted stock purchase agreements equal to a total
of 15,750,273 shares of our common stock at prices ranging from $0.00033 to
$5.00 to employees, consultants and directors pursuant to our 1998 Stock Plan,
as amended.
(2) On March 23, 1998, we sold 5,545,875 shares of common stock to our
three founders in exchange for $0.00033 per share for an aggregate purchase
price of $1,848.63.
(3) On April 16, 1998, we sold 1,333,333 shares of Series A Preferred Stock
for $1.20 per share to a group of private investors for an aggregate purchase
price of $1,599,999.60.
(4) On June 8, 1998 and July 21, 1998, we sold 3,248,904 shares of Series B
Preferred Stock for $1.65 per share to a group of private investors for an
aggregate purchase price of $5,360,691.60.
(5) On November 24, 1998, we issued warrants to purchase 92,208 shares of
our Series B Preferred Stock to Comdisco, Inc., of which 27,273 have an
exercise price of $1.65 and 64,935 have an exercise price of $2.31.
(6) On February 3, 1999, we sold 3,591,816 shares of Series C Preferred
Stock for $3.42 per share to a group of private investors for an aggregate
purchase price of $12,284,010.
(7) On September 1, 1999, we issued a warrant to purchase 6,396 shares of
Series C Preferred Stock at an exercise price of $3.42 to Comdisco, Inc.
(8) On October 14, 1999, we sold 7,072,732 shares of Series D Preferred
Stock for $5.96 per share to a group of private investors for an aggregate
purchase price of $42,153,482.72.
(9) On October 14, 1999, we issued a warrant to purchase 218,120 shares of
Series D Preferred Stock at an exercise price of $5.96 to Microsoft
Corporation.
(10) On December 3,1999, we issued a warrant to purchase 25,268 shares of
Series D Preferred Stock at an exercise price of $5.96 to Comdisco, Inc.
For additional information concerning these equity investment transactions,
reference is made to the information contained under the caption "Certain
Relationships and Related Transactions" in the form of prospectus included
herein.
II-2
<PAGE>
Item 16. Exhibits And Financial Statement Schedules
(a) Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description of Document
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<C> <S>
1.1* Form of Underwriting Agreement.
3.1** Amended and Restated Certificate of Incorporation of the Registrant.
3.2** Form of Amended and Restated Certificate of Incorporation of the
Registrant, to be filed prior to the closing of this offering.
3.3** By-Laws of the Registrant.
3.4** Form of Amended and Restated By-Laws of the Registrant, to be
effective upon the closing of this offering.
4.1* Form of Registrant's Common Stock certificate.
4.2** Amended and Restated Investors' Rights Agreement dated October 14,
1999.
4.3** Series D Stock Purchase Warrant dated October 14, 1999 held by
Microsoft Corporation.
4.4** Voting Agreement dated October 14, 1999.
4.5** Voting Agreement with Liberty IB, Inc. dated February 12, 1999.
5.1* Opinion of Wilson Sonsini Goodrich & Rosati Professional
Corporation.
10.1** Form of Indemnification Agreement entered into by the Registrant
with each of its directors and executive officers.
10.2 Employment Agreement dated January 12, 1999 between the Registrant
and Peter Desnoes.
10.3** 1998 Stock Plan and forms of agreement thereunder.
10.4** 2000 Stock Plan and forms of agreement thereunder.
10.5** 2000 Employee Stock Purchase Plan.
10.6** 2000 Director Option Plan.
10.7 Sublease Agreement dated July 6, 1998 between Netscape
Communications, Inc. and the Registrant with respect to Registrant's
facilities in Sunnyvale, California.
10.8+ iBEAM and Microsoft Broadband Streaming Initiative Agreement dated
September 20, 1999.
10.9+ iBEAM Network Membership Agreement by and between the Registrant and
Covad Communications Group dated October 5, 1999.
10.10+ Teleport Services Agreement dated December 13, 1999 between Williams
Vyvx Services, a business unit of Williams Communications, Inc., and
the Registrant.
23.1** Consent of PricewaterhouseCoopers, LLP, independent accountants.
23.2* Consent of Counsel. Reference is made to Exhibit 5.1.
24.1** Power of Attorney.
27.1** Financial Data Schedule.
</TABLE>
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* To be filed by amendment.
** Previously filed.
+ Confidential treatment requested.
II-3
<PAGE>
(b) Financial Statement Schedules
Schedules not listed above have been omitted because the information
required to be set forth therein is not applicable or is shown in the
financial statements or notes thereto.
Item 17. Undertakings
We hereby undertake to provide to the underwriters at the closing specified
in the underwriting agreement certificates in such denominations and
registered in such names as required by the underwriters to permit prompt
delivery to each purchaser.
Insofar as indemnification by us for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of iBEAM pursuant to the provisions referenced in Item 14 of this Registration
Statement or otherwise, we have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act, and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by us of expenses incurred or paid by a director, officer, or
controlling person of iBEAM in the successful defense of any action, suit or
proceeding) is asserted by a director, officer or controlling person in
connection with the securities being registered hereunder, we will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
We hereby undertake that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of Prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form
of Prospectus filed by iBEAM pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of Prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this amendment to the registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the city
of Sunnyvale, State of California, on the 16th day of February, 2000.
iBEAM BROADCASTING CORPORATION
By: /s/ Chris Dier___________________
Chris Dier
Vice President and Chief Financial
Officer
Pursuant to the requirements of the Securities Act of 1933, this amendment
to the registration statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
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<S> <C> <C>
/s/ Peter Desnoes* President and Chief February 16, 2000
____________________________________ Executive Officer and
Peter Desnoes Chairman of the Board
(Principal Executive
Officer)
/s/ Chris Dier Vice President and Chief February 16, 2000
____________________________________ Financial Officer
Chris Dier (Principal Financial and
Accounting Officer)
/s/ Barry Baker* Director February 16, 2000
____________________________________
Barry Baker
/s/ Frederic Seegal* Director February 16, 2000
____________________________________
Frederic Seegal
/s/ Richard Shapero* Director February 16, 2000
____________________________________
Richard Shapero
/s/ Peter Wagner* Director February 16, 2000
____________________________________
Peter Wagner
/s/ Robert Wilmot* Director February 16, 2000
____________________________________
Robert Wilmot
</TABLE>
By: /s/ Chris Dier_________________
Chris Dier
Attorney-in-fact
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description of Document
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<C> <S>
1.1* Form of Underwriting Agreement.
3.1** Amended and Restated Certificate of Incorporation of the Registrant.
3.2** Form of Amended and Restated Certificate of Incorporation of the
Registrant, to be filed prior to the closing of this offering.
3.3** By-Laws of the Registrant.
3.4** Form of Amended and Restated By-Laws of the Registrant, to be
effective upon the closing of this offering.
4.1* Form of Registrant's Common Stock certificate.
4.2** Amended and Restated Investors' Rights Agreement dated October 14,
1999.
4.3** Series D Stock Purchase Warrant dated October 14, 1999 held by
Microsoft Corporation.
4.4** Voting Agreement dated October 14, 1999.
4.5** Voting Agreement with Liberty IB, Inc. dated February 12, 1999.
5.1* Opinion of Wilson Sonsini Goodrich & Rosati Professional Corporation.
10.1** Form of Indemnification Agreement entered into by the Registrant with
each of its directors and executive officers.
10.2 Employment Agreement dated January 12, 1999 between the Registrant and
Peter Desnoes.
10.3** 1998 Stock Plan and forms of agreement thereunder.
10.4** 2000 Stock Plan and forms of agreement thereunder.
10.5** 2000 Employee Stock Purchase Plan.
10.6** 2000 Director Option Plan.
10.7 Sublease Agreement dated July 6, 1998 between Netscape Communications,
Inc. and the Registrant with respect to Registrant's facilities in
Sunnyvale, California.
10.8+ iBEAM and Microsoft Broadband Streaming Initiative Agreement dated
September 20, 1999.
10.9+ iBEAM Network Membership Agreement by and between the Registrant and
Covad Communications Group dated October 5, 1999.
10.10+ Teleport Services Agreement dated December 13, 1999 between Williams
Vyvx Services, a business unit of Williams Communications, Inc., and
the Registrant.
23.1** Consent of PricewaterhouseCoopers, LLP, independent accountants.
23.2* Consent of Counsel. Reference is made to Exhibit 5.1.
24.1** Power of Attorney.
27.1** Financial Data Schedule.
</TABLE>
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* To be filed by amendment.
** Previously filed.
+ Confidential treatment requested.
<PAGE>
EXHIBIT 10.2
EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into as of January 12, 1999, by and between PETER
DESNOES (the "Executive") and iBEAM BROADCASTING CORPORATION, a Delaware
corporation (the "Company").
1. Duties and Scope of Employment.
(a) Position. For the term of his employment under this Agreement
("Employment"), the Company agrees to employ the Executive in the position of
Chief Executive Officer. The Executive shall report to the Company's Board of
Directors (the "Board").
(b) Obligations to the Company. During the term of his Employment,
the Executive shall devote his full business efforts and time to the Company.
During the term of his Employment, without the prior written approval of the
Company's Board of Directors, the Executive shall not render services in any
capacity to any other person or entity and shall not act as a sole proprietor or
partner of any other person or entity or as a shareholder owning more than five
percent of the stock of any other corporation, except as disclosed in writing to
the Company on the date hereof. However, it is understood that the Executive
will continue to serve in a non-executive capacity as a managing member of
Westwind Communications, LLC. The Executive shall comply with the Company's
policies and rules, as they may be in effect from time to time during the term
of his Employment.
(c) No Conflicting Obligations. The Executive represents and warrants
to the Company that he is under no obligations or commitments, whether
contractual or otherwise, that are inconsistent with his obligations under this
Agreement. The Executive represents and warrants that he will not use or
disclose to the Company, in connection with his Employment by the Company, any
trade secrets or other proprietary information or intellectual property in which
the Executive or any other person has any right, title or interest which he is
not authorized to disclose. The Executive represents and warrants that his
Employment by the Company as contemplated by this Agreement will not infringe or
violate the rights of any other person, pursuant to any offer letter, employment
agreement, severance agreement, confidentiality agreement or proprietary
information and inventions agreement or similar contract binding on the
Executive.
(d) Commencement Date. The Executive shall commence part-time
Employment on January 12, 1999 and full-time employment on March 1, 1999.
2. Cash and Incentive Compensation.
(a) Salary. The Company shall pay the Executive as compensation for
his services a base salary at a gross annual rate of not less than $300,000.
Such salary shall be payable in accordance with the Company's standard payroll
procedures. (The annual compensation specified in this Subsection (a), together
with any increases in such compensation that the Company may grant from time to
time, is referred to in this Agreement as "Base Compensation").
<PAGE>
(b) Incentive Bonuses. The Executive shall be eligible for an annual
incentive bonus equal to $200,000 ("Bonus"). Such Bonus for 1999 (if any) shall
be awarded based on the Executive's completion of the following milestones: (i)
a bonus of $100,000 shall be paid to the Executive as soon as practicable
following the closing of a capital-raising financing for the Company (subsequent
to the Series C round of financing) in an amount equal to at least $20,000,000;
and (ii) a bonus of $25,000 shall be paid to the Executive at the close of each
of four fiscal quarters, beginning March 31, 1999, upon the achievement of
objective or subjective criteria to be agreed upon in advance with the Board. In
subsequent years, during his Employment, the Bonus shall be payable quarterly,
based on achievement of criteria to be agreed upon in advance with the Board.
The determinations of the Board with respect to such Bonus shall be final and
binding.
(c) Relocation. The Company shall pay for a reasonable number of
round trips for the Executive and the Executive's spouse to travel between
Wisconsin and the Bay Area to facilitate the Executive's search for a home and a
reasonable number of round trips for the Executive to visit his family in
Wisconsin until the Executive's family moves to the Bay Area. The Company shall
pay for temporary housing and living expenses in the Bay Area until the earlier
of September 1, 1999 or the date the Executive occupies a home in the Bay Area.
The Company shall also reimburse the Executive for the closing costs and 50% of
the real estate agent fees incurred in the sale of the Executive's home is
Wisconsin, with such reimbursement to not exceed $100,000. The Company shall
reimburse the reasonable expenses, estimated at $20,000, that the Executive
incurs in moving himself, his family and his household from Wisconsin to the Bay
Area.
(d) Stock Options. Subject to the approval of the Board, the Company
shall grant the Executive an incentive stock option ("Option") covering 480,000
shares of the Company's Common Stock. The exercise price of such Option shall be
equal to the fair market value of such stock on the later of (i) the date of
grant or (ii) the first day of the Executive's Employment. The current fair
market value per share of Common Stock is $0.165. The term of such Option shall
be 10 years, subject to the earlier expiration in the event of the termination
of the Executive's Employment. Such Option shall be immediately exercisable, but
the purchased shares shall be subject to repurchase by the Company at the
exercise price in the event that the Executive's Employment terminates before he
vests in the shares. The Executive shall vest in 25% of the Option shares after
the first 12 months of continuous service and shall vest in the remaining Option
shares in equal monthly installments over the next three years of continuous
service. Subject to Subsections 7(a) and 7(b)(ii) below, the grant of such
Option shall be subject to the other terms and conditions set forth in the
Company's 1998 Stock Plan and in the Company's standard form of stock option
agreement.
(e) Series C Stock. The Executive shall have the right to purchase up
to 80,000 shares of the Company's Series C Preferred Stock at a purchase price
per share equal to the price to be paid by the other Series C investors. These
shares shall be purchased on terms substantially similar to the terms applicable
to the other investors in the Series C financing and these shares shall be fully
vested.
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<PAGE>
3. Vacation and Employee Benefits. During the term of his Employment, the
Executive shall be eligible for paid vacation sin accordance with the Company's
standard policy for similarly situated employees, as it may be amended from time
to time. During the term of his Employment, the Executive shall be eligible to
participate in any employee benefit plans maintained by the Company for
similarly situated employees, subject in each case to the generally applicable
terms and conditions of the plan in question and to the determinations of any
person or committee administering such plan.
4. Business Expenses. During the term of his Employment, the Executive
shall be authorized to incur necessary and reasonable travel, entertainment and
other business expenses in connection with his duties hereunder. The Company
shall reimburse the Executive for such expenses upon presentation of an itemized
account and appropriate supporting documentation, all in accordance with the
Company's generally applicable policies.
5. Term of Employment.
(a) Basic Rule. The Company agrees to continue the Executive's
Employment, and the Executive agrees to remain in Employment with the Company,
from the commencement date set forth in Section 1(d) until the date when the
Executive's Employment terminates pursuant to Subsection (b) below. The
Executive's Employment with the Company shall be "at will." Any contrary
representations which may have been made to the Executive shall be superseded by
this Agreement. This Agreement shall constitute the full and complete agreement
between the Executive and the Company on the "at will" nature of the Executive's
Employment. Although the Executive's job duties, title, compensation and
benefits, as well as the Company's personnel policies and procedures, may change
from time to time, the "at will" nature of the Executive's Employment may only
be changed in an express written agreement signed by the Executive and a duly
authorized officer of the Company.
(b) Termination. The Company may terminate the Executive's Employment
and the Executive may terminate his Employment for any reason by giving each
other 14 days' advance notice in writing. The Executive's Employment shall
terminate automatically in the event of his death.
(c) Rights Upon Termination. Except as expressly provided in Section
6 or 7, upon the termination of the Executive's Employment pursuant to this
Section 5, the Executive shall only be entitled to the compensation, benefits
and reimbursements described in Sections 2, 3 and 4 for the period preceding the
effective date of the termination. The payments under this Agreement shall fully
discharge all responsibilities of the Company to the Executive.
(d) Termination of Agreement. This Agreement shall terminate when all
obligations of the parties hereunder have been satisfied. The termination of
this Agreement shall not limit or otherwise affect any of the Executive's
obligations under Section 8.
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<PAGE>
6. Termination of Benefits.
(a) General Release. Any other provision of this Agreement
notwithstanding, Subsection (b) below shall not apply unless the Executive (i)
has executed a general release (in a form prescribed by the Company) of all
known and unknown claims that he may then have against the Company or persons
affiliated with the Company and (ii) has agreed not to prosecute any legal
action or other proceeding based upon any of such claims. The general release
shall also provide for a non-defamation provision that precludes the Executive
and the Company from defaming each other.
(b) Severance Benefits. If, during the term of this Agreement, the
Employee experiences an Involuntary Termination (as defined in Subsection 6(c)),
then the Executive shall receive twelve (12) months of Base Compensation that
will be paid in accordance with the Company's standard payroll procedure over a
twelve-month period, and the Company shall pay the Executive's monthly premium
under COBRA (if the Executive elects COBRA) until the earliest of (a) the date
that is twelve (12) months following the Involuntary Termination, (b) the
expiration of the Executive's continuation of coverage under COBRA or (c) the
date when the Executive receives health insurance coverage in connection with
new employment or self-employment; provided that if the Executive receives
severance benefits under Section 7, he shall not b eligible to receive benefits
under this Subsection 6(b).
(c) Definition of "Involuntary Termination." For all purposes under
this Agreement, "Involuntary Termination" shall mean the termination of the
service of the Executive which occurs by reason of:
(i) Such Executive's involuntary dismissal or discharge by the
Company for reasons other than Cause, or
(ii) Such Executive's voluntary resignation following (A) a
change in his position with the Company which materially reduces his level of
responsibility, (B) a reduction in his level of compensation, including base
salary and participation in corporate-performance based bonus or incentive
programs (except for across-the-board reductions in the compensation of
officers) or (C) a relocation of such Executive's place of employment by more
than fifty (50) miles, provided and only if such change, reduction or relocation
is effected by the Company without the Executive's consent.
(d) Definition of "Clause." For all purposes under this Agreement,
"Cause" shall mean:
(i) Unauthorized use or disclosure of the confidential
information or trade secrets of the Company;
(ii) Any material breach of this Agreement, the Proprietary
Information and Inventions Agreement between the Executive and the Company, or
any other agreement between the Executive and the Company;
-4-
<PAGE>
(iii) Conviction of, or plea of "guilty" or "no contest" to, a
felony under the laws of the United States or any state thereof;
(iv) Misappropriation of the assets of the Company or other
acts of dishonesty, which have a material adverse effect on the Company or its
assets;
(v) Willful misconduct or gross negligence in the performance
of duties assigned to the Executive under this Agreement;
(vi) Failure to perform reasonable duties assigned to the
Executive under this Agreement for a period of 30 continuous days following the
receipt of written notice of such failure to perform from the Board; or
(vii) Failure to comply with the Company's policies or rules, as
they may be in effect from time to time during the term of the Executive's
Employment for a period of 30 continuous days following the receipt of written
notice of such failure to comply from the Board.
The foregoing shall not be deemed an exclusive list of all acts or omissions
that the Company may consider as grounds for the termination of the Executive's
Employment.
7. Change in Control.
In the event of a Change in Control (as defined in the Company's 1998 Stock
Plan), the Executive shall agree to continue service with the Company and/or its
successor corporation for a period not exceeding six (6) months if such service
is requested by the Company and/or its successor corporation ("Transition
Period"). The Transition Period may be longer than six (6) months, upon the
mutual agreement of the Executive and the Company. During the Transition Period,
the Executive shall be paid his Base Compensation plus an amount equal to a pro
rata portion of his target bonus for the year in which the Change in Control
occurs. In addition, the Executive shall continue to vest in the Option shares
during the Transition Period. Upon the Executive's completion of the Transition
Period or in the event that the Company and/or its successor corporation does
not request the Executive to continue service during a Transition Period, then
the Executive shall receive a lump sum amount equal to six (6) months of Base
Compensation plus an amount equal to a pro rata portion of his target bonus for
the year in which the Change in Control occurs, and the Executive shall become
vested in an additional number of unvested Option shares, as if he performed an
additional six (6) months of service. This vesting acceleration provision shall
become effective six (6) months from the date of Option grant. In the event that
the Executive declines the Company's and/or its successor corporation's request
to continue service with the Company, then the Executive shall not be eligible
to receive any benefits under Subsection 6(b) or this Subsection 7; provided,
however, if the Executive's refusal to continue service constitutes an
Involuntary Termination, then the Executive shall be eligible to receive the
benefits described in Subsection 6(b).
8. Non-Solicitation and Non-Disclosure.
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<PAGE>
(a) Non-Solicitation. During the period commencing on the date of
this Agreement and continuing until the first anniversary of the date when the
Executive's Employment terminated for any reason, the Executive shall not
directly or indirectly, personally or through others, solicit or attempt to
solicit (on the Executive's own behalf or on behalf of any other person or
entity) either (i) the employment of any employee of the Company or any of the
Company's affiliates or (ii) the business of any customer of the Company or any
of the Company's affiliates with whom the Executive had contact during his
Employment.
(b) Non-Disclosure. The Executive has entered into a Proprietary
Information and Inventions Agreement with the Company, which is incorporated
herein by reference.
9. Successors.
(a) Company's Successors. This Agreement shall be binding upon any
successor (whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company's business and/or assets. For all purposes under this Agreement, the
term "Company" shall include any successor to the Company's business and/or
assets which becomes bound by this Agreement.
(b) Executive's Successor. This Agreement and all rights of the
Executive hereunder shall inure to the benefit of, and be enforceable by, the
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.
10. Miscellaneous Provisions.
(a) Notice. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid. In the case of the Executive, mailed
notices shall be addressed to him at the home address which he most recently
communicated to the Company in writing. In the case of the Company, mailed
notices shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its Secretary.
(b) Modifications and Waivers. No provision of this Agreement shall
be modified, waived or discharged unless the modification, waiver or discharge
is agreed to in writing and signed by the Executive and by an authorized officer
of the Company (other than the Executive). No waiver by either party of any
breach of, or of compliance with, any condition or provision of this Agreement
by the other party shall be considered a waiver of any other condition or
provision or of the same condition or provision at another time.
(c) Whole Agreement. No other agreements, representations or
understandings (whether oral or written and whether express or implied) which
are not expressly set forth in this Agreement have been made or entered into by
either party with respect to the subject matter hereof. This Agreement and the
Proprietary Information and Inventions Agreement contain the entire
understanding of the parties with respect to the subject matter hereof.
-6-
<PAGE>
(d) Withholding Taxes. All payments made under this Agreement shall
be subject to reduction to reflect taxes or other charges required to be
withheld by law.
(e) Choice of Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
California (except their provisions governing the choice of law).
(f) Severability. The invalidity or unenforceability of any provision
or provisions of this Agreement shall not affect the validity or enforceability
of any other provision hereof, which shall remain in full force and effect.
(g) No Assignment. This Agreement and all rights and obligations of
the Executive hereunder are personal to the Executive and may not be transferred
or assigned by the Executive at any time. The Company may assign its rights
under this Agreement to any entity that assumes the Company's obligations
hereunder in connection with any sale or transfer of all or a substantial
portion of the Company's assets to such entity.
(h) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
-7-
<PAGE>
IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the
case of the Company by its duly authorized officer, as of the day and year first
above written.
/s/ Peter Desnoes
---------------------------------
Peter Desnoes
iBEAM BROADCASTING CORPORATION
By: /s/ [illegible]
------------------------------
Title: President
---------------------------
-8-
<PAGE>
EXHIBIT 10.7
SUBLEASE
(645 Almanor, Sunnyvale)
THIS SUBLEASE ("Sublease"), dated November 6, 1998 for reference purposes only,
is entered into by and between NETSCAPE COMMUNICATIONS, INC., a Delaware
corporation ("Netscape") and IBEAM BROADCASTING CORPORATION, a Delaware
corporation ("Subtenant").
RECITALS
A. Netscape leases certain premises consisting of an industrial building
(the "Building") containing approximately 132,000 square feet located at 645
Almanor, Sunnyvale, California, pursuant to that certain Lease dated November 1,
1996 between The Prudential Insurance Company Of America as landlord (the
"Master Landlord") and Netscape, as tenant (the "Master Lease"), as more
particularly described therein (the "Premises"). Capitalized terms used but not
defined herein have the same meanings as they have in the Master Lease. A copy
of the Master Lease is attached hereto as Exhibit A.
B. Netscape desires to sublease a portion of the Premises to Subtenant,
and Subtenant desires to sublease a portion of the Premises from Netscape on the
terms and provisions hereof.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, Netscape and Subtenant covenant and agree as follows:
AGREEMENT
1. Subleased Premises. On and subject to the terms and conditions below,
Netscape hereby leases to Subtenant, and Subtenant hereby leases from
Netscape, approximately thirty six thousand four hundred seventy nine
(36,479) separately demised square feet of the Premises, known as Suite
100 (the "Subleased Premises"). A description of the Subleased Premises
is attached hereto as Exhibit B.
2. Term. This Sublease shall commence on the later to occur of (i)
December 1, 1998 or (ii) the completion of Netscape's installation of a
demising wall pursuant to Section 7 hereof (the "Commencement Date"),
provided Netscape has theretofore obtained the consent of Master
Landlord, and shall expire February 15, 2002, unless sooner terminated
pursuant to any provision hereof.
3. Possession. If for any reason Netscape cannot deliver possession of the
Subleased Premises to Subtenant on the Commencement Date, Netscape
shall not be subject to any liability therefor, nor shall such failure
affect the validity of this Sublease or the obligations of Subtenant
hereunder or extend the term hereof, provided that no rent shall be due
hereunder until possession of the Subleased Premises has been delivered
to Subtenant. Notwithstanding
<PAGE>
anything to the contrary contained herein, if Netscape has not
delivered the Premises substantially completed to Subtenant on or
before February 1, 1999, Subtenant shall have the right thereafter to
cancel this Lease, and upon such cancellation, Netscape shall return
all sums theretofore deposited by Subtenant with Netscape, and neither
party shall have any further liability to the other.
4. Rent.
(a) Commencing on the Commencement Date and continuing throughout the
term of this Sublease, Subtenant shall pay monthly rent ("Rent") to
Netscape in the following amounts:
(i) Base Rent. Subtenant shall pay to Netscape monthly base rent
---------
("Base Rent") in the following amounts:
Month Monthly Base Rent
------ -----------------
01-12 $1.45/ rentable square foot
13-24 $1.50/ rentable square foot
25-End of term $1.55/ rentable square foot
(ii) Additional Rent. In addition to Base Rent, Subtenant shall
---------------
also pay to Netscape as additional rent ("Additional Rent")
Subtenant's pro rata share ("Subtenant's Pro-Rata Share") of
Building Operating Expenses (as defined below). Netscape and
Subtenant hereby agree that Subtenant's Pro-Rata Share shall be
the quotient derived by dividing the number of rentable square
feet of the Subleased Premises by 132,000. To the extent that
Netscape notifies Subtenant that any items constituting Additional
Rent are due and payable under the Master Lease on a monthly
basis, such Additional Rent shall be paid by Subtenant to Netscape
as and when Basic Rent is paid. To the extent that such items
constituting Additional Rent are billed from time to time to
Netscape by Master Landlord, such Additional Rent shall be paid by
Subtenant to Netscape within seven (7) days after Subtenant's
receipt from Netscape of an invoice therefor.
(b) "Building Operating Expenses" are defined, for purposes of this
Sublease, as all actual costs and expenses paid or incurred by Netscape
in connection with its management, operation, maintenance and repair of
the Premises, including, without limitation: (i) the cost of
electricity, natural gas, water, telephone, waste disposal and all
other utilities, (ii) the cost of maintenance and repairs and all labor
and material costs related thereto, including, without limitation,
maintenance and repair of building systems, fire detection and
sprinkler systems, building signs and directories, roof, common areas
(including, without limitation, parking areas, loading and unloading
areas, trash areas, striping, bumpers, irrigation systems, lighting
facilities, elevators, fences and gates) and the cost of general
maintenance, cleaning and service contracts and the cost of all
supplies, tools and equipment required in connection therewith, (iii)
wages, salaries, payroll taxes and other labor costs and employee
benefits,
-2-
<PAGE>
(iv) management fees (which shall not exceed management fees charged
for similar facilities in the area and in any event, shall not exceed
5% of all other Building Operating Expenses), (v) fees, charges and
other costs of all independent contractors engaged by Netscape, (vi)
reasonable accounting and legal expenses, (vii) depreciation on
personal property, (viii) janitorial and security systems, (ix) all
operating expenses (as that term is used in the Master Lease) payable
by Netscape to Master Landlord pursuant to the Master Lease, and (x)
any other expenses of any kind whatsoever reasonably incurred in
connection with the management, operation, maintenance and repair of
the Building.
Notwithstanding anything to the contrary contained in this Sublease,
costs or expenses in connection with services or other benefits of a
type that are not provided to Subtenant but which are provided to
other tenants or occupants of the Building (including Netscape) shall
not be included within Building Operating Expenses.
(c) Payment of Rent. If the Commencement Date does not fall on the
first day of a calendar month, Rent for the first month shall be
prorated on a daily basis based upon a calendar month. Rent shall be
payable to Netscape in lawful money of the United States, in advance,
without prior notice, demand, or offset, on or before the first day of
each calendar month during the term hereof. All Rent shall be paid to
Netscape at the address specified for notices to Netscape in Section
16, below.
(d) Subtenant recognizes that late payment of any Rent will result in
administrative expenses to Netscape, the extent of which additional
expenses are extremely difficult and economically impractical to
ascertain. Subtenant therefore agrees that if any Rent shall remain
unpaid five (5) days after such amounts are due, the amount of such
Rent shall be increased by a late charge to be paid to Netscape by
Subtenant in an amount equal to the greater of five hundred dollars
($500.00) or five percent (5%) of the amount of the delinquent Rent.
(e) Upon execution of this Sublease, Subtenant shall deliver to
Netscape the sum of fifty two thousand eight hundred ninety four and
55/100 Dollars ($52,894.55), representing the first month's Base Rent.
5. Security Deposit. Upon execution of this Sublease, Subtenant shall
deposit with Netscape fifty two thousand eight hundred ninety four and
55/100 Dollars ($52,894.55) as a security deposit ("Security
Deposit"). If Subtenant fails to pay Rent or other charges when due
under this Sublease, or fails to perform any of its other obligations
hereunder, Netscape may use or apply all or any portion of the
Security Deposit for the payment of any Rent or other amount then due
hereunder and unpaid, for the payment of any other sum for which
Netscape may become obligated by reason of Subtenant's default or
breach, or for any loss or damage sustained by Netscape as a result of
Subtenant's default or breach. If Netscape so uses any portion of the
Security Deposit, Subtenant shall restore the Security Deposit to the
full amount originally deposited within ten (10) days after Netscape's
written demand. Netscape shall not be required to keep the Security
Deposit separate from its general
-3-
<PAGE>
accounts, and shall have no obligation or liability for payment of
interest on the Security Deposit. The Security Deposit, or so much
thereof as had not theretofore been applied by Netscape, shall be
returned to Subtenant within thirty (30) days of the expiration or
earlier termination of this Sublease, provided Subtenant has vacated
the Subleased Premises.
6. Condition of Subleased Premises. Except as otherwise provided in
Section 7 hereof, Subtenant has used due diligence in inspecting the
Subleased Premises and agrees to accept the Subleased Premises in
"as-is" condition and with all faults as of the date of Subtenant's
execution of this Sublease, without any representation or warranty of
any kind or nature whatsoever, or any obligation on the part of
Netscape to modify, improve or otherwise prepare the Subleased
Premises for Subtenant's occupancy, and by entry hereunder, Subtenant
accepts the Subleased Premises in their present condition and without
representation or warranty of any kind by Netscape. Subtenant hereby
expressly waives the provisions of subsection 1 of Section 1932 and
Sections 1941 and 1942 of the California Civil Code and all rights to
make repairs at the expense of Netscape as provided in Section 1942 of
said Civil Code.
7. Condition of the Subleased Premises upon Commencement. Netscape will
deliver the Subleased Premises with all building systems in good
working order and repair, and the Subleased Premises separately
demised.
8. Use. Subtenant may use the Subleased Premises only for the purposes as
allowed in the Master Lease, and for no other purpose. Subtenant shall
promptly comply with all applicable statutes, ordinances, rules,
regulations, orders, restrictions of record, and requirements in
effect during the term of this Sublease governing, affecting and
regulating the Subleased Premises, including but not limited to the
use thereof. Subtenant shall not use or permit the use of the
Subleased Premises in a manner that will create waste or a nuisance,
interfere with or disturb other tenants in the Building or violate the
provisions of the Master Lease.
9. Alterations.
(a) Subtenant shall not make any alterations to the Subleased
Premises without the express written consent of Netscape and the
Master Landlord, which shall not be unreasonably withheld, and shall
otherwise comply with the Alterations section of the Master Lease as
incorporated herein.
(b) Subject to the consent of the Master Landlord, Netscape hereby
grants its consent to Subtenant's right of access to the roof and the
right to install and maintain a satellite dish (es) on the roof.
Netscape will use commercially reasonable efforts to obtain Master
Landlord's consent for such access, installation, and maintenance.
Subtenant agrees to indemnify, defend and hold Netscape and Master
Landlord harmless from and against any and all actions, claims,
demands, costs liabilities, losses, reasonable attorneys' fees,
damages, penalties, and expenses which may be brought or made against
Netscape or Master Landlord or which Netscape or Master
-4-
<PAGE>
Landlord may pay or incur to the extent caused by Subtenant's rights
under this Section 9.
10. Parking. Subtenant shall have its proportionate share of parking
rights as Netscape may have in connection with the Premises pursuant
to the Master Lease.
11. Incorporation of Sublease.
(a) All of the terms and provisions of the Master Lease, except as
provided in subsection (b) below, are incorporated into and made a
part of this Sublease and the rights and obligations of the parties
under the Master Lease are hereby imposed upon the parties hereto with
respect to the Subleased Premises, Netscape being substituted for the
"Landlord" in the Master Lease, and Subtenant being substituted for
the "Tenant" in the Master Lease. It is further understood that where
reference is made in the Master Lease to the "Premises," the same
shall mean the Subleased Premises as defined herein; where reference
is made to the "Commencement Date," the same shall mean the
Commencement Date as defined herein; and where reference is made to
the "Lease," the same shall mean this Sublease.
(b) The following Sections of the Master Lease are not incorporated
herein: Basic Lease Information (except "Use"), 1, 2, 3, 4, 5, 6, 7,
9(a), the first three sentences of 9(b), 10(b), 13(c), 23(c), 24, 26,
28, 30, 37 and 40; Exhibits B-l, B-2, C, C-l and E.
(c) Subtenant hereby assumes and agrees to perform for Netscape's
benefit, during the term of this Sublease, all of Netscape's
obligations with respect to the Subleased Premises under the Master
Lease, except as otherwise provided herein. Subtenant shall not commit
or permit to be committed any act or omission which violates any term
or condition of the Master Lease. Except as otherwise provided herein,
this Sublease shall be subject and subordinate to all of the terms of
the Master Lease.
12. Insurance. Except as modified by this Section 12, Subtenant shall be
responsible for compliance with the insurance provisions of the Master
Lease. The minimum coverages as set forth in the Master Lease shall be
modified for the purposes of this Sublease so that they shall not
exceed $2,000,000 for each type of insurance named therein. Such
insurance shall insure the performance by Subtenant of its
indemnification obligations hereunder and shall name Master Landlord
and Netscape as additional insureds. All insurance required under this
Sublease shall contain an endorsement requiring thirty (30) days
written notice from the insurance company to Subtenant and Netscape
before cancellation or change in the coverage, insureds or amount of
any policy. Subtenant shall provide Netscape with certificates of
insurance evidencing such coverage prior to the commencement of this
Sublease.
13. Utilities. Subject to reimbursement pursuant to Section 4(a)(ii) of
this Sublease, Netscape shall provide the Subleased Premises with
commercially reasonable
-5-
<PAGE>
amounts of water, electricity and janitorial service. Netscape
reserves the right to install a separate meter to measure the
consumption of any utility supplied by Netscape. If it is reasonably
determined that Subtenant has been using more than a commercially
reasonable amount of any utility supplied by Netscape, then such
installation shall be at the sole cost to Subtenant. Subtenant shall
separately contract with the appropriate utility for any services
desired by Subtenant and not provided by Netscape.
14. Signage. Subject to approval by Master Landlord, which Netscape shall
use commercially reasonable efforts to obtain, Netscape shall cause to
be installed, at its own cost and expense, monument signage for the
Subtenant.
15. Default. In addition to defaults contained in the Master Lease,
failure of Subtenant to make any payment of Rent when due hereunder
shall constitute an event of default hereunder.
16. Notices. The addresses specified in the Master Lease for receipt of
notices to each of the parties are deleted and replaced with the
following:
To Netscape at: Netscape Communications, Inc.
501 East Middlefield Road
Mountain View, California 94043
Attn: Director of Real Estate
With copy to: Cooley Godward LLP
5 Palo Alto Square
3000 El Camino Real
Palo Alto, CA 94306
Attn: Toni P. Wise
To Subtenant at: IBEAM BROADCASTING CORPORATION
2903 Bunker Hill Lane, Suite 201
Santa Clara, CA 95054
Attn: Chief Financial Officer
After Commencement
Date: At the Subleased Premises
17. Netscape's Obligations.
(b) To the extent that the provision of any services or the
performance of any maintenance or any other act respecting the
Premises or Building is the responsibility of Master Landlord
(collectively "Master Landlord Obligations"), upon Subtenant's
request, Netscape shall make reasonable efforts to cause Master
Landlord to perform such Master Landlord Obligations, provided,
however, that in no event shall Netscape be liable to Subtenant for
any liability, loss or damage whatsoever in the event that Master
Landlord should fail to perform the same, nor shall Subtenant be
entitled to
-6-
<PAGE>
withhold the payment of Rent or terminate this Sublease. It is
expressly understood that the services and repairs which are
incorporated herein by reference, including but not limited to the
structural portions of the roof and building, will in fact be
furnished by Master Landlord and not by Netscape, except to the extent
otherwise provided in the Master Lease. In addition, Netscape shall
not be liable for any maintenance, restoration (following casualty or
destruction) or repairs in or to the Building or Subleased Premises,
other than its obligation hereunder to use reasonable efforts to cause
Master Landlord to perform its obligations under the Master Lease.
With respect to any maintenance or repair to be performed by Master
Landlord respecting the Subleased Premises, the parties expressly
agree that Subtenant shall have the right to contact Master Landlord
directly to cause it to so perform.
(b) Except as otherwise provided herein, Netscape shall have no other
obligations to Subtenant with respect to the Subleased Premises or the
performance of the Master Landlord Obligations.
18. Early Termination of Sublease. If, without the fault of Netscape, the
Master Lease should terminate prior to the expiration of this
Sublease, Netscape shall have no liability to Subtenant on account of
such termination. To the extent that the Master Lease grants Netscape
any discretionary right to terminate the Master Lease, whether due to
casualty, condemnation, or otherwise, Netscape shall be entitled to
exercise or not exercise such right in its complete and absolute
discretion.
19. Consent of Master Landlord and Netscape. If Subtenant desires to take
any action which requires the consent or approval of Netscape pursuant
to the terms of this Sublease, prior to taking such action, including,
without limitation, making any alterations, then, notwithstanding
anything to the contrary herein, (a) Netscape shall have the same
rights of approval or disapproval as Master Landlord has under the
Master Lease, and (b) Subtenant shall not take any such action until
it obtains the consent of Netscape and Master Landlord, as may be
required under this Sublease or the Master Lease. This Sublease shall
not be effective unless and until any required written consent of the
Master Landlord shall have been obtained.
20. Indemnity. Subtenant shall indemnify, defend, protect, and hold
Netscape and Master Landlord harmless from and against all actions,
claims, demands, costs liabilities, losses, reasonable attorneys'
fees, damages, penalties, and expenses (collectively "Claims") which
may be brought or made against Netscape or which Netscape may pay or
incur to the extent caused by (i) a breach of this Sublease by
Subtenant, (ii) any violation of law by Subtenant or its employees,
agents, contractors or invitees (collectively, "Agents") relating to
the use or occupancy of the Subleased Premises, (iii) any act or
omission by Subtenant or its Agents resulting in contamination of any
part or all of the Subleased Premises by Hazardous Materials, or (iv)
the negligence or willful misconduct of Subtenant or its Agents.
21. Brokers. Each party hereto represents and warrants that it has dealt
with no broker in connection with this Sublease and the transactions
contemplated herein, except
-7-
<PAGE>
Cornish & Carey Commercial/ONCOR International. Each party shall
indemnify, protect, defend and hold the other party harmless from all
costs and expenses (including reasonable attorneys' fees) arising from
or relating to a breach of the foregoing representation and warranty.
22. No Third Party Rights. The benefit of the provisions of this Sublease
is expressly limited to Netscape and Subtenant and their respective
permitted successors and assigns. Under no circumstances will any
third party be construed to have any rights as a third party
beneficiary with respect to any of said provisions.
23. Counterparts. This Sublease may be signed in two or more counterparts,
each of which shall be deemed an original and all of which shall
constitute one agreement.
24. Conditions Precedent. The Master Landlord's consent to this Sublease
and the terms and conditions of Section 9 hereunder is a condition
precedent to the effectiveness of this Sublease.
-8-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Sublease as of the date first
written above.
<TABLE>
<CAPTION>
NETSCAPE SUBTENANT
<S> <C>
Netscape Communications, Inc., IBEAM Broadcasting Corporation,
a Delaware corporation a Delaware corporation
By: Ed Axelsen By: Michael Bowles
---------------------------------------------- ----------------------------------------
Sig: /s/ Ed Axelsen Sig: /s/ Michael Bowles
---------------------------------------------- ---------------------------------------
Its: Director of Real Estate and Facilities Its: President
--------------------------------------------- ---------------------------------------
By:_______________________________________________ By:________________________________________
Sig:______________________________________________ Sig:_______________________________________
Its:______________________________________________ Its:_______________________________________
</TABLE>
-9-
<PAGE>
CONSENT OF MASTER LANDLORD
--------------------------
The PRUDENTIAL INSURANCE COMPANY OF AMERICA, the Master Landlord under the
Master Lease hereby consents to the Sublease attached hereto, and all of the
terms and conditions contained therein (including, without limitation, the
provisions of Section 9).
The Prudential Insurance Company of America,
a New Jersey corporation.
By:___________________________
Its:__________________________
Date:_________________________
-10-
<PAGE>
EXHIBIT A
MASTER LEASE
-11-
<PAGE>
LEASE
BETWEEN
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
A NEW JERSEY CORPORATION
AND
NETSCAPE COMMUNICATIONS CORPORATION
A DELAWARE CORPORATION
FOR THE PREMISES LOCATED AT
645 ALMANOR AVENUE
SUNNYVALE, CALIFORNIA 94086
DATED: NOVEMBER 1, 1996
1
<PAGE>
BASIC LEASE INFORMATION
-----------------------
DATE: November 1, 1996
LANDLORD: THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, a
New Jersey corporation
TENANT: NETSCAPE COMMUNICATIONS CORPORATION, a
Delaware corporation
PREMISES: Building Address: 645 Almanor Avenue
Sunnyvale, CA 94086
USE: Office, research and development, light
manufacturing and distribution not involving
Hazardous Substances
TERM: Commencing on Commencement Date as defined in
Section 2(a) and expiring sixty (60) months
after Base Rent Commencement Date
ESTIMATED COMMENCEMENT
DATE: November 3, 1996
BASE RENT: Months Base Rent
------ ---------
(measured from Base Rent Commencement Date as
defined in Section 4)
1-36 $97,500.00 per month
37-60 $109,200.00 per month
ADVANCE RENT: $97,500
TENANT'S PERCENTAGE SHARE: 100%
SECURITY DEPOSIT: None
BROKERS: Tenant's Broker: Cornish & Carey Commercial
Landlord's Broker: ~BT Commercial Real Estate
CONTRACT MANAGER: Voit Management Company, L.P.
ADDRESS FOR NOTICES: Landlord: The Prudential Insurance Company
of America
Four Embarcadero Center, Suite
2700
San Francisco, CA 94111-4180
-1-
<PAGE>
Contract
Manager: With a copy to:
Voit Management Company, L.P.
1111 Broadway, Suite 1510
Oakland, CA 94607
Tenant: Netscape Communications Corporation
645 Almanor Avenue
Sunnyvale, CA 94086
With a copy to:
Legal Department
Netscape Communications Corp.
501 East Middlefield Road
Mountain View, CA 94043
-2-
<PAGE>
EXHIBITS AND ADDENDUM: Exhibit A - Site Plan of Premises
Exhibit B-1 - Commencement Date Memorandum
Exhibit B-2 - Base Rent Commencement Date Memorandum
Exhibit C - ADA and HVAC Improvements
Exhibit D - Rules and Regulations
Exhibit E - Environmental Reports
INITIALS: /s/ MB /s/ PNC
--------------------- ------------------------
Landlord Tenant
-3-
<PAGE>
THIS LEASE, which is effective as of the date set forth in the Basic Lease
Information, is entered into by Landlord and Tenant, as set forth in the Basic
Lease Information. Terms which are capitalized in this Lease and not expressly
defined herein shall have the meanings set forth in the Basic Lease Information.
1. Premises. Landlord leases to Tenant, and Tenant leases from
--------
Landlord, the Premises described in the Basic Lease Information (as shown in
Exhibit A), together with all improvements located thereon.2.
2. Term.
----
(a) Lease Term. The Term of this Lease shall commence on the later of
----------
November 3, 1996 or the date Landlord tenders possession of the Premises to
Tenant (the "Commencement Date") and, unless terminated on an earlier date in
accordance with the terms of this Lease, shall expire on the date which is the
date before the fifth anniversary of the Base Rent Commencement Date (the
"Expiration Date"), as defined in Section 4 ("Term").
(b) Premises Not Delivered. If, for any reason, Landlord cannot
----------------------
deliver possession of the Premises to Tenant by the Estimated Commencement Date
(as set forth in the Basic Lease Information), (i) the Term shall not commence
until the Commencement Date; (ii) the failure shall not affect the validity of
this Lease, or the obligations of Tenant under this Lease; and (iii) Landlord
shall not be subject to any liability.
(c) Drop Dead Date. Notwithstanding anything to the contrary
--------------
contained herein, if Landlord has not delivered the Premises to Tenant on or
before January 1, 1997, Tenant shall have the right as its exclusive remedy
thereafter to cancel this Lease, and upon such cancellation, Landlord shall
return all sums theretofore deposited by Tenant with Landlord, and neither party
shall have further liability to the other.
(d) Commencement Date Memorandum. When the Commencement Date is
----------------------------
determined, the parties shall execute a Commencement Date Memorandum, in the
form attached hereto as Exhibit B-1, setting forth the Commencement Date.
-----------
3. Rent. As used in this Lease, the term "Rent" shall include: (i) the
----
Base Rent; (ii) Tenant's Percentage Share of the Operating Expenses paid or
incurred by Landlord during the calendar year; and (iii) all other amounts which
Tenant is obligated to pay under the terms of this Lease. All amounts of money
payable by Tenant to Landlord shall be paid without prior notice or demand,
deduction or offset. This Lease is intended to be a triple net lease, with all
costs, expenses and charges (including the Operating Expenses) paid by Tenant.
Tenant hereby acknowledges that late payment by Tenant to Landlord of Rent will
cause Landlord to incur costs not contemplated by this Lease, the exact amount
of which will be difficult to ascertain. Such costs include, but are not limited
to, processing and accounting charges, and late charges which may be imposed on
Landlord by the terms of any trust deed covering the Premises. Accordingly, if
any installment of Rent or any other sums due from Tenant shall not be received
by Landlord when due, Tenant shall pay to Landlord a late charge equal to six
percent (6%) of such overdue amount. The parties hereby agree
1
<PAGE>
that such late charge represents a fair and reasonable estimate of the costs
Landlord will incur by reason of late payment by Tenant. Acceptance of such late
charge by Landlord shall in no event constitute a waiver of Tenant's default
with respect to such overdue amount, nor prevent Landlord from exercising any of
the other rights and remedies granted hereunder. In addition, any amount which
is not paid when due shall bear interest from the date due until the date paid
at the rate ("Interest Rate") which is the lesser of fifteen percent (15%) per
annum or the maximum rate permitted by law.
4. Base Rent. Tenant shall pay Base Rent to Contract Manager (or other
---------
entity designated by Landlord), in advance, on the first day of each calendar
month of the Term commencing as of the Base Rent Commencement Date, at Contract
Manager's address for notices (as set forth in the Basic Lease Information) or
at such other address as Landlord may designate. The Base Rent shall be the
amount set forth in the Basic Lease Information. As used herein, the term "Base
Rent Commencement Date" shall mean the date which is the earlier of (a) ninety
days after the Commencement Date, or (b) the date that Tenant commences business
operations on the Premises. When the Base Rent Commencement Date is determined,
the parties shall execute a Base Rent Commencement Date Memorandum, in the form
attached hereto as Exhibit B-2, setting forth the Base Rent Commencement Date
-----------
and the expiration date ("Expiration Date") of this Lease.
5. Operating Expenses.
------------------
(a) Operating Expenses as Portion of Rent. Tenant shall pay as
-------------------------------------
additional Rent Tenant's Percentage Share of the Operating Expenses paid or
incurred by Landlord during the calendar year.
(b) Definition of Operating Expenses. The term "Operating Expenses"
--------------------------------
shall mean (i) all of Landlord's direct costs and expenses of operation, repair
and maintenance of the Premises, as determined by Landlord in accordance with
generally accepted accounting principles or other recognized accounting
principles, consistently applied; (ii) a reasonably amortized portion of the
costs of any capital improvements made to the Premises by Landlord which
comprise labor-saving devices or other equipment intended to improve the
operating efficiency of any system within the Premises (such as an energy
management computer system) to the extent of cost savings in Operating Expenses
as a result of the device or equipment, as reasonably determined by Landlord;
and (iii) costs allocable to the Premises of any capital improvements made to
the Premises by Landlord that are required under any governmental law or
regulation that was not applicable to the Premises at the time they were
constructed, and/or that are reasonably required for the health and safety of
tenants in the Premises, and/or are installed to repair or replace property
located in the Premises as of the Commencement Date, the costs to be amortized
over such reasonable period as Landlord shall reasonably determine together with
interest on the unamortized balance at the Interest Rate or such higher rate as
may have been paid by Landlord on funds borrowed for the purpose of constructing
the capital improvements. The term "Operating Expenses" shall include the cost
of all insurance which Landlord or Landlord's lender reasonably deems necessary
for the Premises; a reasonable management fee; dues imposed by any property
owner's association ("Association"); and the Real Property Taxes (as defined in
subsection 5(f)). If Landlord elects to self-insure or includes the Premises
under blanket insurance policies covering multiple properties, then the term
"Operating Expenses" shall include the portion of the cost of such self-
insurance or blanket insurance allocated
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<PAGE>
by Landlord to this Premises. The definition of Operating Expenses shall not be
deemed to impose any obligations on Landlord to perform any obligations under
this Lease. Landlord's sole obligations regarding maintenance, repair or
otherwise related to the condition of the Premises are specified in Section 7
and subsection 10(b) of the Lease.
(c) Exclusions from Operating Expenses. The term "Operating
----------------------------------
Expenses" shall not include (i) Leasing commissions, attorneys' fees, costs,
disbursements, and other expenses incurred in connection with negotiations or
disputes with tenants, or in connection with leasing, renovating, or improving
space for tenants; (ii) the cost of any service sold to Tenant for which
Landlord is reimbursed as an additional charge or rental over and above the
basic rent and escalations payable under this Lease; (iii) any depreciation on
the Premises; (iv) increases in costs incurred due to Landlord's default of any
terms or conditions of this Lease (beyond applicable notice and cure periods);
(v) overhead profit increments paid to Landlord's subsidiaries or affiliates for
management or other services on or to the building or for supplies or other
materials to the extent that the cost of the services, supplies, or materials
exceeds the cost that would have been paid had the services, supplies or
materials been provided by unaffiliated unionized parties on a competitive
basis; (vi) all interest, loan fees, and other carrying costs related to any
mortgage or deed of trust and all rental and other amounts payable due under any
ground or underlying lease; (vii) any compensation paid to clerks, attendants,
or other persons in commercial concessions operated by Landlord on the Premises;
(viii) advertising and promotional expenditures; (ix) costs of repairs and other
work occasioned by fire, windstorm, or other casualty to the extent insured by
Landlord; provided, however, reasonable deductibles under any such policy may be
included in Operating Expenses; (x) any fines, or penalties incurred due to
violations by Landlord of any governmental rule or authority, which is not the
responsibility of Tenant under the Lease, or costs due to Landlord's gross
negligence or willful misconduct; (xi) management costs to the extent they
exceed 5% of Base Rent plus other Operating Expenses; (xii) costs for sculpture,
paintings, or other objects of art (nor insurance thereon or extraordinary
security in connection therewith); (xiii) wages, salaries, or other compensation
paid to any executive employees above the grade of building manager; (ix) the
cost of correcting any building code or other violations which were violations
prior to the Commencement Date, provided that a condition which was constructed
in compliance with laws at the time of construction shall be deemed to be in
compliance with applicable law notwithstanding that such law has thereafter been
changed or amended; and (x) costs incurred to contain, remove or remediate any
contamination of the ground water under the Premises by Hazardous Substances.
(d) Estimates of Operating Expenses. During December of each
-------------------------------
calendar year during the Term, or as soon thereafter as practicable, Landlord
shall give Tenant written notice of Landlord's estimate of the amount of
Operating Expenses which will be payable for the ensuing calendar year. On or
before the first day of each month during the ensuing calendar year, Tenant
shall pay to Landlord one-twelfth (1/12) of the estimated amount; provided,
however, that if notice is not given in December, Tenant shall continue to pay
on the basis of the then applicable Rent until the month after the notice is
given. If at any time it reasonably appears to Landlord that the amount payable
for the current calendar year will vary from Landlord's estimate by more than
five percent (5%), Landlord may give notice to Tenant of Landlord's revised
estimate for the year, and subsequent payments by Tenant for the year shall be
based on the revised estimate; provided, however, that Landlord shall not give
notice of a revised estimate for any year more frequently than once a calendar
quarter.
-3-
<PAGE>
(e) Annual Adjustment. Within one hundred twenty (120) days after
-----------------
the close of each calendar year of the Term, or as soon after the one hundred
twenty (120) day period as practicable, Landlord shall deliver to Tenant a
statement of the actual Operating Expenses for the prior calendar year. If, on
the basis of the statement, Tenant owes an amount that is less than the
estimated payments for the calendar year previously made by Tenant, Landlord
shall apply the excess to the next payment of Operating Expenses due. If, on the
basis of the statement, Tenant owes an amount that is more than the estimated
payments for the calendar year previously made by the Tenant, Tenant shall pay
the deficiency to Landlord within thirty (30) days after delivery of the
statement. The statement of Operating Expenses shall be presumed correct and
shall be deemed final and binding upon Tenant unless (i) Tenant in good faith
objects in writing thereto within thirty (30) days after delivery of the
statement to Tenant (which writing shall state, in reasonable detail, all of the
reasonable detail, all of the reasons for the objection); and (ii) Tenant pays
in full, within thirty (30) days after delivery of the statement to Tenant, any
amount owed by Tenant with respect to the statement which is not in dispute.
Tenant's failure to pay the amount shown on Landlord's statement within thirty
(30) days after delivery thereof or Tenant's failure to pay in a timely manner
the revised estimate of Landlord's determination of Operating Expenses shall be
deemed an irrevocable waiver of Tenant's right to contest and/or receive any
credit or reimbursement for an overcharge of Operating Expenses shown on the
Landlord's statement under which payment is required at that time. If Tenant
objects to Landlord's allocation to the Premises of the cost of self-insurance
or blanket insurance, such allocation shall nonetheless be presumed correct and
shall be deemed final and binding upon Tenant unless Tenant's timely written
objection includes credible evidence that Landlord could have obtained
substantially comparable insurance coverage for this Premises alone at lower
cost.
(f) Tenant's Right to Audit Landlord's Records. Within 90 days
------------------------------------------
after timely giving Landlord its notice of its objection to Landlord's statement
of actual Operating Expenses in accordance with Section 5(e), (the "Landlord's
Statement"), Tenant shall have the right to audit at Landlord's local offices,
at Tenant's expense, Landlord's accounts and records relating to Operating
Expenses and Real Property Taxes. Such audit shall be conducted by a certified
public accountant approved by Landlord, which approval shall not be unreasonably
withheld, and shall be completed within such ninety (90) day period. If such
audit reveals that Landlord has overcharged Tenant, the amount overcharged shall
be paid (or at Landlord's option credited toward amounts next payable by Tenant
under this Lease) to Tenant within 30 days after the audit is concluded. In
addition, if, following such audit, the parties agree that Landlord's Statement
of Operating Expenses exceeds the actual Operating Expenses which should have
been charged to Tenant by more than 15%, the cost of such audit shall be paid by
Landlord.
(g) Definition of Real Property Taxes. The term "Real Property
---------------------------------
Taxes" shall mean any ordinary or extraordinary form of assessment or special
assessment, license fee, rent tax, levy, penalty (if a result of Tenant's
delinquency), or tax, other than net income, estate, succession, inheritance,
transfer or franchise taxes, imposed by any authority having the direct or
indirect power to tax, or by any city, county, state or federal government for
any maintenance or improvement or other district or division thereof. The term
shall include all transit charges, housing fund assessments, real estate taxes
and all other taxes relating to the Premises, all other taxes which may be
levied in lieu of real estate taxes, all assessments, assessment bonds, levies,
fees and other governmental charges (including, but not limited to, charges for
traffic facilities, improvements,
-4-
<PAGE>
child care, water services studies and improvements, and fire services studies
and improvements) for amounts necessary to be expended because of governmental
orders, whether general or special, ordinary or extraordinary, unforeseen as
well as foreseen, of any kind and nature for public improvement, services,
benefits or any other purposes which are assessed, levied, confirmed, imposed or
become a lien upon the Premises or become payable during the Term.
(h) Acknowledgment of Parties. It is acknowledged by Landlord and
-------------------------
Tenant that Proposition 13 was adopted by the voters of the State of California
in the June, 1978 election, and that assessments, taxes, fees, levies and
charges may be imposed by governmental agencies for such purposes as fire
protection, street, sidewalk, road, utility construction and maintenance, refuse
removal and for other governmental services which formerly may have been
provided without charge to property owners or occupants. It is the intention of
the parties that all new and increased assessments, taxes, fees, levies and
charges due to Proposition 13 or any other cause are to be included within the
definition of Real Property Taxes for purposes of this Lease.
(i) Taxes on Tenant Improvements and Personal Property.
--------------------------------------------------
Notwithstanding any other provision hereof, Tenant shall pay the full amount of
any Real Property Taxes during the Term resulting from any and all alterations
and tenant improvements of any kind whatsoever placed in, on or about the
Premises for the benefit of, at the request of, or by Tenant. Tenant shall pay,
prior to delinquency, all taxes assessed or levied against Tenant's personal
property in, on or about the Premises. When possible, Tenant shall cause its
personal property to be assessed and billed separately from the real or personal
property of Landlord.
6. Proration of Rent. If the Commencement Date is not the first day of
-----------------
the month, or if the end of the Term is not the last day of the month, Rent
shall be prorated on a monthly basis (based upon a thirty (30) day month) for
the fractional month during the month which this Lease commences or terminates.
The termination of this Lease shall not affect the obligations of Landlord and
Tenant pursuant to subsection 5(e) which are to be performed after the
termination.
7. Tenant Improvements.
-------------------
(a) Landlord shall cause the electrical system, plumbing and roof to
be in good and operable condition and repair as of the Commencement Date.
However, Landlord shall not be obligated to make any alteration or repair
required as a result of improvements to be installed by Tenant in the Premises.
Landlord shall be conclusively deemed to have satisfied the foregoing obligation
unless Tenant identifies specific items of noncompliance by delivery of written
notice to Landlord within sixty (60) days after the Commencement Date. Upon
Landlord's correction of such items, Landlord's obligations under this
subsection (a) shall be deemed fully satisfied.
(b) Tenant shall install the ADA Improvements and HVAC Improvements
shown on attached Exhibit C and Landlord shall reimburse Tenant up to $47,500
---------
for costs incurred by Tenant in connection with the ADA Improvements and up to
$75,000 for costs incurred by Tenant in connection with the HVAC Improvements in
accordance with Exhibit C.
---------
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<PAGE>
(c) Except as specified in subsections (a) above and (d) below,
Tenant shall accept the Premises "as-is" and with all faults and Landlord shall
have no obligations to improve or modify the Premises.
(d) Landlord covenants and represents that it has full and complete
authority to enter into this Lease under all of the terms, covenants and
provisions set forth herein and so long as Tenant performs each and every term,
provision and condition herein contained on the part of Tenant to be performed,
Tenant may peacefully and quietly enjoy the Premises in accordance with the
terms of this Lease.
8. Uses of Premises.
----------------
(a) Tenant shall use the Premises solely for the use set forth in the
Basic Lease Information, and Tenant shall not use the Premises for any other
purpose without obtaining the prior written consent of Landlord, which consent
shall not be unreasonably withheld. Tenant shall, at its own cost and expense,
comply with all laws, rules, regulations, orders, permits, licenses and
ordinances issued by any governmental authority which relate to the condition,
use or occupancy of the Premises during the term of this Lease. Notwithstanding
the foregoing or anything to the contrary contained in this Lease, Tenant shall
not be responsible for compliance with any laws, codes, ordinances or other
governmental directives where such compliance is not related specifically to or
required as a result of Tenant's use, occupancy and/or alteration of the
Premises. For example, if any governmental authority should require the Premises
to be structurally strengthened against earthquake and such measures are imposed
as a general requirement applicable to all tenants rather than as a condition of
Tenant's specific use or occupancy of or alterations to the Premises, such work
shall be performed by Landlord and included in a capital expense under Operating
Expenses. Tenant shall not use the Premises in any manner that will constitute
waste or nuisance.
(b) "Hazardous Substance" shall mean the substances including within
the definitions of the term "Hazardous Substance" under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended, 42
U.S.C. Section 9601 et seq., and the California Carpenter-Presley-Tanner
------
Hazardous Substance Account Act, California Health & Safety Code Section 25300
et seq., and regulations promulgated thereunder, as amended. "Hazardous Waste"
- ------
shall mean (a) any waste listed as or meeting the identified characteristics of
a "Hazardous Waste" under the Resource Conservation and Recovery Act of 1976, 42
U.S.C. Section 6901 et seq., and regulations promulgated pursuant thereto,
------
collectively "RCRA," or (b) any waste meeting the identified characteristics of
"Hazardous Waste" under California Hazardous Waste Control Law, California
Health and Safety Code Section 25100 et. seq., and regulations promulgated
-------
pursuant thereto, collectively "CHWCL". "Hazardous Waste Facility" shall mean a
hazardous waste facility as defined under CHWCL.
(c) Tenant covenants that, at its sole cost and expense, it will
comply with all applicable laws, rules, regulations, orders, permits, licenses
and operating plans of any governmental authority with respect to the use,
handling, generation, transportation, storage, treatment and/or disposal of
Hazardous Substances or Wastes brought on to the Premises by Tenant and/or
Tenant's agents, contractors, employees, invitees, licensees, sublessees or
other person on or about the Premises during the term, and Tenant will provide
Landlord copies of all permits, registrations or
-6-
<PAGE>
other similar documents that authorize Tenant to conduct any such activities in
connection with its authorized use of the Premises. Additionally, Tenant agrees
to comply with the Rules and Regulations attached hereto as Exhibit D, the
---------
requirements of the Board of Fire Underwriters or Landlord's insurance carrier,
and to comply with covenants, conditions and restrictions ("CC&R's"), if any,
applicable to the Property.
(d) Tenant agrees that it shall not operate on the Premises any
facility required to be permitted or licensed as a Hazardous Waste Facility or
for which interim status as such is required. Nor shall Tenant store any
Hazardous Wastes on the Premises for ninety (90) days or more.
(e) No underground storage tanks shall be permitted on the Premises.
(f) If applicable, Tenant shall provide to Landlord in writing the
following information and/or documentation at the Commencement Date and within
sixty (60) days of any change in the required information and/or documentation:
(i) A list of all Hazardous Substances and/or Wastes that
Tenant uses, handles, generates, transports, stores, treats or disposes in
connection with its operations on the Premises.
(ii) Copies of all Material Safety Data Sheets ("MSDS's")
required to be completed with respect to operations of Tenant at the Premises in
accordance with Title 8, California Code of Regulations Section 5194 or 42
U.S.C. Section 11021, or any amendments thereto. In lieu of this requirement,
Tenant may provide a Hazardous Materials Inventory Sheet that details the
MSDS's.
(iii) Copies of all hazardous waste manifests, as defined in
Title 26, California Code of Regulations Section 22-66260.10, that Tenant is
required to complete in all connections with its operations at the Premises.
(iv) A copy of any Hazardous Materials Management Plans
required with respect to Tenant's operations.
(v) Copies of any Contingency Plans and Emergency Procedures,
if any, required of Tenant due to its operations in accordance with Title 26,
Section 22-66260.10, of the California Code of Regulations, and any amendments
thereto.
(vi) Copies of any biennial reports to be furnished to
California Department of Health Services relating to Hazardous Substances or
Wastes.
(vii) Copies of all industrial waste water discharge permits.
(g) Tenant shall secure Landlord's prior written approval for any
proposed receipt, storage, possession, use, transfer or disposal of "Radioactive
Materials" or "Radiation", as such materials are defined in Title 26, California
Code of Regulations Sections 17-30100 or possessing the characteristics of the
materials so defined, which approval Landlord may withhold in
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<PAGE>
its sole and absolute discretion. The Tenant in connection with any authorized
receipt, storage, possession, use, transfer or disposal of radioactive materials
or radiation shall:
(i) Comply with all federal, state and local laws, rules,
regulations, orders, licenses and permits;
(ii) Furnish Landlord with a list of all radioactive materials
or radiation received, stored, possessed, used, transferred or disposed; and
(iii) Furnish Landlord with all licenses, registration
materials, inspection reports, orders and permits in connection with the
receipt, storage, possession, use, transfer or disposal or radioactive materials
or radiation.
(h) Tenant agrees to comply with any and all applicable laws, rules,
regulations, and orders with respect to the release into the environment of any
Hazardous Wastes or Substances or Radiation or Radioactive Materials brought on
to the Premises by Tenant and/or Tenant's agents, contractors, employees,
invitees, licensees, sublessees or other person on or about the Premises during
the Term. Tenant agrees to notify Landlord in writing of any unauthorized
release into the environment within twenty-four (24) hours of the time at which
Tenant becomes aware of such release.
(i) Tenant shall indemnify, defend, and hold Landlord harmless from
any and all claims, losses (including, but not limited to, loss of rental income
and loss due to business interruption), damages, (including diminution in value
or loss of rental value following expiration or earlier termination of the Term)
liabilities, costs, legal fees, and expenses of any sort arising out of or
relating to any unauthorized release into the environment of Hazardous
Substances or Wastes or Radiation or Radioactive Materials by Tenant or any of
Tenant's agents, contractors or invitees, or Tenant's failure to comply with
Subparagraphs (a)-(h) of this section of the Lease.
(j) Tenant agrees to cooperate with Landlord in furnishing Landlord
with complete information regarding Tenant's receipt, handling, use, storage,
transportation, generation, treatment and/or disposal of Hazardous Substances or
Wastes or Radiation or Radioactive Materials. Upon reasonable prior written
notice, Tenant agrees to grant Landlord reasonable access at reasonable times to
the Premises to inspect Tenant's receipt, handling, use, storage,
transportation, generation, treatment and/or disposal of Hazardous Substances
Wastes or Radiation or Radioactive Materials without being deemed guilty of any
disturbance of Tenant's use or possession and without being liable to Tenant in
any manner.
(k) Notwithstanding Landlord's rights of inspection and review under
this paragraph, Landlord shall have no obligation or duty to so inspect or
review, and no third party shall be entitled to rely on Landlord to conduct any
sort of inspection or review by reason of the provisions of this paragraph.
-8-
<PAGE>
(l) The following provisions shall apply to any Existing
Contamination (as defined below):
(i) Tenant acknowledges that (1) certain Hazardous Substances
may be located on, about or under the Premises; (2) Landlord has made available
to Tenant the environmental reports referenced on attached Exhibit E
---------
(collectively the "Environmental Reports"); (3) neither Landlord nor any agent
or contractor of Landlord has made any representation or warranty concerning the
environmental condition of the Premises; (iv) neither Landlord nor any agent or
contractor of Landlord has made any representation or warranty concerning the
accuracy or completeness of the Environmental Reports; (v) Tenant shall make
such additional assessments, tests or inquiries regarding the environmental
condition of the Premises as Tenant may deem necessary or appropriate; provided
that Tenant shall not conduct any tests on or about the Premises unless Tenant
has obtained the prior written approval of Landlord regarding the nature and
scope of such testing; and (4) subject to Landlord's indemnity referenced below,
Tenant shall accept the Premises in its "AS IS" environmental condition. As used
herein, the term "Existing Contamination" shall mean the identity of Hazardous
Substances referenced in the Environmental Reports as being located on, under or
in the vicinity of the Premises as of the date of this Lease or otherwise proven
by Tenant to have been located on or under the Premises as of the date of this
Lease or to have migrated under the Premises during the term of this Lease
(other than migration caused by the acts or omissions of Tenant and or Tenant's
agents, contractors, licensees or invitees or other persons on the Premises
during the term of this Lease).
(ii) Subject to the provisions of this subsection, Landlord
shall indemnify, defend and hold harmless Tenant from and against any
Environmental Claim (as defined below) asserted against Tenant and, subject to
the limitations referenced in the following paragraph, any out of pocket costs,
fees and expenses, including attorneys' and consultant's fees, paid by Tenant in
connection with such Environmental Claim, provided that the foregoing indemnity
shall not apply to the extent that any such Environmental Claim arises out of or
is caused or exacerbated by the negligence or intentional act or intentional
failure to act of Tenant or any affiliate of Tenant and/or their respective
agents, contractors, employees, licensees, invitees, sublessees and/or
assignees. As used in this Lease, the term "Environmental Claim" shall mean any
claim, demand, loss, damage and/or liability asserted against Tenant with
respect to the Existing Contamination (i) by a governmental authority for the
investigation abatement, clean up or remediation of or other action related to
Existing Contamination on the Premises, or (ii) by any third party who is not an
affiliate, subsidiary, partner, agent, employee or invitee of Tenant. The
parties acknowledge that the term "Environmental Claim" shall not include under
any circumstance (a) lost profits, business interruption, whether in connection
with a claim related to the Existing Contamination or otherwise, or (b) any
consequential damages suffered or incurred by Tenant, or (c) any claim related
to Hazardous Substances on the Premises which are not included within the scope
of the term "Existing Contamination".
(iii) In the event an Environmental Claim is asserted against
Tenant for which Tenant intends to seek indemnification pursuant to the
foregoing paragraph, Tenant shall promptly deliver written notice to Landlord of
such Environmental Claim and Landlord shall have exclusive authority related to
the response to and defense of the Environmental Claim. No cost, fee or expense
paid or incurred by Tenant with respect to an Environmental Claim shall be
required to
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<PAGE>
be reimbursed or indemnified by Landlord unless Landlord has previously approved
such expense in writing or Landlord has denied approval of such expense on the
basis that the foregoing indemnity does not cover the specific Environmental
Claim for which such expense was incurred and thereafter it is determined
pursuant to a final non-appealable judicial order that the foregoing indemnity
does cover the specific Environmental Claim for which such expense was incurred.
Tenant shall cooperate with landlord in connection with the response to and
defense of any Environmental Claim and shall make available to Landlord such
information and personnel as Landlord may reasonably request in order to respond
to or defend such Environmental Claim.
(m) This Section 8 of the Lease shall survive termination of the
Lease.
9. Alterations.
-----------
(a) Initial Alterations.
-------------------
(i) Preliminary Plans. Preliminary plans and specifications
-----------------
for construction of the tenant improvements to be initially installed by Tenant
in the Premises ("Initial Alterations") shall be prepared by a licensed
architect as is proposed by Tenant and reasonably approved by Landlord (the
"Architect"). The preliminary plans and specifications shall be submitted to
Landlord for Landlord's approval which approval shall not be unreasonably
withheld, provided that Landlord may withhold such consent, in Landlord's sole
discretion, if the construction contemplated by such preliminary plans will
affect the structure, roof, or the exterior appearance of the Premises, or will
have an adverse affect on the utility systems of the Premises. The preliminary
plans and specifications approved as set forth above are referred to herein as
the "Approved Preliminary Plans."
(ii) Working Drawings. Promptly following approval of the
----------------
Approved Preliminary Plans, Tenant shall instruct the Architect to produce, and
submit to Landlord for review and approval, which approval shall not be
unreasonably withheld, working drawings and specifications. The working drawings
and specifications which have been approved as provided herein are hereinafter
referred to as the "Approved Working Drawings."
(iii) Selection of Contractor. Tenant shall engage a general
-----------------------
contractor as is proposed by Tenant and reasonably approved by Landlord (the
"Contractor") to construct the Initial Alterations.
(iv) Construction. Tenant shall cause construction of the
------------
Initial Alterations to be completed in a good and workmanlike manner and in
compliance with all applicable laws, rules and regulations. Tenant shall provide
access to Landlord at all reasonable times for the purpose of inspecting the
construction of the Initial Alterations and shall cooperate with Landlord and
Landlord's agents during such inspections and provide to Landlord and Landlord's
agents such information as Landlord or Landlord's agents may reasonably request.
(v) Change Requests. No changes to the Approved Working
---------------
Drawings requested by Tenant shall be made without Landlord's prior approval.
Any changes to the Approved
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<PAGE>
Working Drawings shall be in writing and shall be signed by both Landlord and
Tenant prior to the change being made.
(vi) Plans and Specifications. Upon completion, Tenant shall
------------------------
deliver to Landlord a complete set of "as-built" plans and specifications for
the Initial Alterations.
(b) Additional Alterations. As used in this Section 9, the term
----------------------
"alteration" shall include the Initial Alterations and any subsequent
alteration, addition or improvement. Tenant shall give Landlord not less than
ten (10) days' notice of any alteration Tenant desires to make to the Premises.
Except for the Initial Alterations, Tenant shall not make any alteration in, on
or about the Premises without the prior written consent of Landlord unless the
alteration does not require a building permit, affect the Building structure,
the exterior appearance of the Building, the roof or the Building systems (e.g.,
-----
electrical systems) and the cost of the alteration is not in excess of Twenty
Thousand Dollars ($20,000.00) in each particular instance or in excess of Eighty
Thousand Dollars ($80,000.00) in any calendar year. Tenant shall comply with all
rules, laws, ordinances and requirements applicable at the time Tenant makes any
alteration and shall deliver to Landlord a complete set of "as built" plans and
specifications for each alteration. Tenant shall be solely responsible for
maintenance and repair of all alterations made by Tenant.
(c) Liens. If, because of any act or omission of Tenant or anyone
-----
claiming by, through, or under Tenant, any mechanics' lien or other lien is
filed against the Premises or against other property of Landlord (whether or not
the lien is valid or enforceable), Tenant, at its own expense, shall cause it to
be discharged of record within a reasonable time, not to exceed thirty (30)
days, after the date of the filing. In addition, Tenant shall defend and
indemnify Landlord and hold it harmless from any and all claims, losses,
damages, judgments, settlements, costs and expenses, including attorneys' fees,
resulting from the lien.
(d) Ownership of Alterations. Any alteration made by Tenant
------------------------
immediately shall become landlord's property. Except as provided in subsection
9(d), Landlord may require Tenant, at Tenant's sole expense and by the end of
the Term, to remove any alterations made by Tenant (including any alterations
which do not require Landlord's consent) and to restore the Premises to its
condition prior to the alteration, provided that Tenant shall not be required to
remove such alterations if, in response to Tenant's request pursuant to
subsection (d) below, Landlord has notified Tenant at the time Landlord consents
to such alteration that such removal will not be required.
(e) Request Regarding Removal Obligation. At the time that Tenant
------------------------------------
requests Landlord's consent to any alteration, Tenant may request that Landlord
notify Tenant if Landlord will require Tenant, at Tenant's sole expense, to
remove any or all of the alteration by the end of the Term, and to restore the
Premises to its condition prior to the alteration.
10. Repairs.
-------
(a) Tenant's Obligation. Except as provided in subsection 10(b),
-------------------
Tenant, at all times during the Term and at Tenant's sole cost and expense,
shall keep the Premises and every part thereof in good condition and repair,
including without limitation any replacement of any element of the Premises
requiring replacement, ordinary wear and tear, damage thereto not caused by
Tenant,
-11-
<PAGE>
by fire, earthquake, acts of God or the elements excepted. Tenant hereby waives
all right to make repairs at the expense of Landlord or in lieu thereof to
vacate the Premises as provided in California Civil Code Section 1942 or any
other law, statute or ordinance now or hereafter in effect.
(b) Landlord's Obligations. Landlord, at Landlord's expense, shall
----------------------
repair and maintain the structural portions of the roof (but not roof membrane
or other non-structural elements of the roof) and structural portions of the
Building unless and to the extent that the maintenance and repair are caused by
the act, neglect, fault or omission of any duty of Tenant, its agents, servants,
employees or invitees, in which case Tenant shall pay to Landlord the cost of
the maintenance and repairs caused in whole or in part by Tenant. There shall be
no abatement of Rent and no liability of Landlord by reason of any injury to or
interference with Tenant's business arising from the making of any repairs,
alterations or improvements in or to the fixtures, appurtenances and equipment
therein. Landlord's cost of performing the foregoing obligations shall be
included in Operating Expenses.
11. Damage or Destruction.
---------------------
(a) Landlord's Obligation to Rebuild. If the Premises are damaged or
--------------------------------
destroyed, Landlord promptly and diligently shall repair the Premises (subject
to the limitations specified in this Section 11) unless Landlord has the option
to terminate this Lease as provided herein, and Landlord elects to terminate.
(b) Right to Terminate. Landlord and Tenant each shall have the
------------------
option to terminate this Lease if the Premises is destroyed or damaged by fire
or other casualty, regardless of whether the casualty is insured against under
this Lease, if Landlord reasonably determines that Landlord's obligation to
repair the Premises cannot be completed within two hundred seventy (270) days
after the casualty. If a party desires to exercise the right to terminate this
Lease as a result of a casualty, the party shall exercise the right by giving
the other party written notice of its election to terminate within thirty (30)
days after the damage or destruction, in which event this Lease shall terminate
fifteen (15) days after the date of the notice. If neither Landlord nor Tenant
exercises the right to terminate this Lease, Landlord promptly shall commence
the process of obtaining necessary permits and approvals, and shall commence
repair of the Premises as soon as practicable and thereafter prosecute the
repair diligently to completion, in which event this Lease shall continue in
full force and effect.
(c) Limited Obligation to Repair. Landlord's obligation should
----------------------------
Landlord elect or be obligated to repair or rebuild, shall be limited to the
Building shell. Tenant, at its option and expense, shall replace or fully repair
all trade fixtures, equipment and any improvements installed by Tenant and
existing at the time of the damage or destruction.
(d) Abatement of Rent. In the event of any damage or destruction to
-----------------
the Premises which does not result in termination of this Lease, the Base Rent
temporarily shall be abated proportionately to the degree the Premises are
untenantable as a result of the damage or destruction, commencing from the date
of the damage or destruction and continuing during the period required by
Landlord to substantially complete Landlord's repair and restoration of the
Premises; provided, however, that nothing herein shall preclude Landlord from
being entitled to collect the full amount
-12-
<PAGE>
of any rent loss insurance proceeds. Tenant shall not be entitled to any
compensation or damages from Landlord for loss of the use of the Premises,
damage to Tenant's personal property or any inconvenience occasioned by any
damage, repair or restoration. Tenant hereby waives the provisions of Section
1932, Subdivision 2, and Section 1933, Subdivision 4, of the California Civil
Code, and the provisions of any similar law hereafter enacted.
(e) Damage Near End of Term and Extensive Damage. In addition to the
--------------------------------------------
rights to termination under subsection 11(b), either Landlord or Tenant shall
have the right to cancel and terminate this Lease as of the date of the
occurrence of destruction or damage if the Premises or the Building is
substantially destroyed or damaged (i.e., there is damage or destruction which
-----
Landlord determines would require more than six (6) months to repair) and made
untenantable during the last twelve (12) months of the Term. Landlord or Tenant
shall give notice of its election to terminate this Lease under this subsection
11(e) within thirty (30) days after Landlord determines that the damage or
destruction would require more than six (6) months to repair. If neither
Landlord nor Tenant elects to terminate the Lease, the repair of the damage
shall be governed by subsection 11(a) or 11(b), as the case may be.
(f) Insurance Proceeds. If this Lease is terminated, Landlord may
------------------
keep all the insurance proceeds resulting from the damage, except for those
proceeds which specifically insured Tenant's personal property and trade
fixtures.
12. Eminent Domain. If all or any part of the Premises is taken for public
--------------
or quasi-public use by a governmental authority under the power of eminent
domain or is conveyed to a governmental authority in lieu of such taking, and if
the taking or conveyance causes the remaining part of the Premises to be
untenantable and inadequate for use by Tenant for the purpose for which they
were leased, then Tenant, at its option and by giving notice within fifteen (15)
days after the taking, may terminate this Lease as of the date Tenant is
required to surrender possession of the Premises. If a part of the Premises is
taken or conveyed but the remaining part is tenantable and adequate for Tenant's
use, then the Lease shall be terminated as to the part taken or conveyed as of
the date Tenant surrenders possession; Landlord shall make such repairs,
alterations and improvements as may be necessary to render the part not taken or
conveyed tenantable; and the Rent shall be reduced in proportion to the part of
the Premises taken or conveyed. All compensation awarded for the taking or
conveyance shall be the property of Landlord without any deduction therefrom for
any estate of Tenant, and Tenant hereby assigns to Landlord all its right, title
and interest in and to the award. Tenant shall have the right, however, to
recover from the governmental authority, but not from Landlord, such
compensation as may be awarded to Tenant on account of the interruption of
Tenant's business, moving and relocation expenses; and removal of Tenant's trade
fixtures and personal property.
13. Indemnity and Insurance.
-----------------------
(a) Indemnity. Tenant shall be responsible for, shall insure against,
---------
and shall indemnify Landlord and its constituent parts and hold them harmless
from, any and all liability for any claim, demand, liability, loss, damage or
injury to person or property occurring in, on or about the Premises, and Tenant
hereby releases Landlord and its constituent parts from any and all liability
for the same except arising from Landlord's gross negligence or willful
misconduct. Tenant's
-13-
<PAGE>
obligation to indemnify Landlord and its constituent parts hereunder shall
include the duty to defend against any claims asserted by reason of any loss,
damage or injury, and to pay any judgements, settlements, costs, fees and
expenses, including attorneys' fees, incurred in connection therewith.
(b) Insurance. At all times during the term of this Lease, Tenant
---------
shall carry, at its own expense, for the protection of Tenant, Landlord,
Landlord's constituent parts and Landlord's management agents, as their
interests may appear, one or more policies of comprehensive general public
liability and property damage insurance, issued by one or more insurance
companies acceptable to Landlord, with minimum coverages of One Million Dollars
($1,000,000.00) for injury to one person in any one accident, Three Million
Dollars ($3,000,000.00) for injuries to more than one person in any one accident
and Two Million Dollars ($2,000,000.00) in property damage per accident and
insuring against any and all liability for which Tenant is responsible under
this Lease. The insurance policy or policies shall name Landlord, Landlord's
constituent parts and Landlord's management agents as additional insureds, and
shall provide that the policy or policies may not be cancelled on less than
thirty (30) days' prior written notice to Landlord. Tenant shall furnish
Landlord with certificates evidencing the insurance. If Tenant fails to carry
the insurance and furnish Landlord with copies of all the policies after a
request to do so, Landlord shall have the right to obtain the insurance and
collect the cost thereof from Tenant as additional Rent.
(c) Property Insurance. Landlord shall maintain fire and all risk
------------------
insurance on the Building shell and may, but shall not be obligated to maintain
insurance on any improvements installed within the Premises. Tenant shall
separately insure all improvements made by Tenant to the Premises.
14. Assignment and Subletting.
-------------------------
(a) Landlord's Consent. Tenant shall not assign, sublet or otherwise
------------------
transfer all or any portion of Tenant's interest in this Lease (collectively,
"sublet") without Landlord's prior written consent, which consent shall not be
unreasonably withheld except as permitted under Section 14(h), below. Consent by
Landlord to one sublet shall not be deemed to be a consent to any subsequent
sublet.
(b) Effect of Sublet. Each sublet to which Landlord has consented
----------------
shall be by an instrument in writing, in a form satisfactory to Landlord as
evidenced by Landlord's written approval. Each sublessee shall agree in writing,
for the benefit of Landlord, to assume, to be bound by and to perform the terms,
conditions and covenants of this Lease to be performed by Tenant. Tenant shall
not be released from personal liability for the performance of each term,
condition and covenant of this Lease, and Landlord shall have the right to
proceed against Tenant without proceeding against the subtenant.
(c) Information to be Furnished. If Tenant desires at any time to
---------------------------
sublet the Premises, Tenant first shall notify Landlord of its desire to do so
and shall submit in writing to Landlord: (i) the name of the proposed subtenant;
(ii) the nature of the proposed subtenant's business to be carried on in the
Premises; (iii) the terms and provisions of the proposed sublease and a copy of
the proposed sublease form; and (iv) such financial information, including
financial statements, as Landlord reasonably may request concerning the proposed
subtenant.
-14-
<PAGE>
(d) Landlord's Election. At any time within twenty (20) days
-------------------
after Landlord's receipt of the information specified in subsection 14(c),
Landlord, by written notice to Tenant, may elect either (i) to consent to the
sublet by Tenant; or (ii) to refuse its consent to the sublet. If Landlord fails
to elect either of the alternatives within the twenty (20) day period, it shall
be deemed that Landlord has refused its consent to the sublet. If Landlord
refuses its consent, Landlord shall deliver to Tenant a statement of the basis
for its refusal. Any attempted sublet without Landlord's consent shall not be
effective.
(e) Payment Upon Sublet. If Landlord consents to the sublet, Tenant
-------------------
thereafter may enter into a valid sublet of the Premises or portion thereof,
upon the terms and conditions set forth in the information furnished by Tenant
to Landlord pursuant to subsection 14(c), subject to the condition that fifty
percent (50%) of any excess of the monies due to Tenant under the sublet
("subrent") over the Rent required to be paid by Tenant plus the amortized cost
incurred by Tenant for the Initial Alterations constructed by Tenant within the
Premises hereunder shall be paid to Landlord. Any subrent to be paid to Landlord
pursuant hereto shall be payable to Landlord as and with the Base Rent payable
to Landlord hereunder pursuant to the terms of Section 4. The term "subrent" as
used herein shall include any consideration of any kind received, or to be
received, by Tenant from the subtenant, if the sums are related to Tenant's
interest in this Lease or in the Premises, including, without limitation, bonus
money, and payments (in excess of fair market value thereof) for Tenant's
assets, fixtures, inventory, accounts, goodwill, equipment, furniture, general
intangibles and any capital stock or other equity ownership of Tenant. For
purposes of the foregoing calculation, any credit to Tenant for the Initial
Alterations constructed by Tenant in the Premises shall be amortized over a five
(5) year period from the date such cost is incurred with interest on the
unamortized balance at the rate of ten percent (10%) per year. Accordingly, for
any subletting which occurs beyond the initial sixty months of the Term, there
shall be no deduction from subrents for costs incurred by Tenant for the Initial
Alterations.
(f) Executed Counterparts. No sublet shall be valid nor shall any
---------------------
subtenant take possession of the Premises until an executed counterpart of the
sublease has been delivered to Landlord and approved in writing.
(g) Intentionally Omitted
(h) Transfers to Affiliates. Tenant may assign this Lease or sublet
-----------------------
the Premises, without Landlord's consent, to any corporation which controls, is
controlled by or is under common control with Tenant, or to any corporation
resulting from the merger or consolidation with Tenant, or to any person or
entity which acquired all the assets of Tenant as a going concern of the
business that is being conducted on the Premises, provided that the assignee
assumes, in full, the obligations of Tenant under this Lease.
(i) Costs. In the event Tenant shall assign or sublet the Premises
-----
or request the consent of Landlord to any assignment, subletting, hypothecation
or other action requiring Landlord's consent hereunder, then Tenant shall pay a
processing fee in the amount of $500 plus Landlord's reasonable attorneys' fees
incurred in connection therewith.
-15-
<PAGE>
15. Default.
-------
(a) Tenant's Default. At the option of Landlord, a material breach
----------------
of this Lease by Tenant shall exist if any of the following events (severally,
"Event of Default"; collectively, "Events of Default") shall occur: (i) if
Tenant shall have failed to pay Rent, including Tenant's Percentage Share of
Operating Expenses, or any other sum required to be paid hereunder, together
with interest at the Interest Rate, from the date the amount became due through
the date of payment, inclusive; (ii) if Tenant shall have failed to perform any
term, covenant or condition of this Lease except those requiring the payment of
money, and Tenant shall have failed to cure the breach within thirty (30) days
after written notice from Landlord if the breach could reasonably be cured
within the thirty (30) day period; provided, however, if the failure could not
reasonably be cured within the thirty (30) day period, then Tenant shall not be
in default unless it has failed to promptly commence and thereafter continue to
make diligent and reasonable efforts to cure the failure as soon as practicable
as reasonably determined by Landlord; (iii) if Tenant shall have assigned its
assets for the benefit of its creditors; (iv) if the sequestration of,
attachment of, or execution on, any material part of the property of Tenant or
on any property essential to the conduct of Tenant's business shall have
occurred, and Tenant shall have failed to obtain a return or release of the
property within thirty (30) days thereafter, or prior to sale pursuant to any
sequestration, attachment or levy, whichever is earlier; (v) if a court shall
have made or entered any decree or order adjudging Tenant to be insolvent, or
approving as properly filed a petition seeking reorganization of Tenant, or
directing the winding up or liquidation of Tenant, and the decree or order shall
have continued for a period of thirty (30) days; (vi) if Tenant shall make or
suffer any transfer which constitutes a fraudulent or otherwise avoidable
transfer under any provision of the federal Bankruptcy Laws or any applicable
state law; or (vii) if Tenant shall have failed to comply with the provisions of
Section 23 or 25. An Event of Default shall constitute a default under this
Lease. Notwithstanding the foregoing, an Event of Default shall not be deemed to
have occurred with respect to the first two failures to pay Rent when due during
any twelve month period until three (3) days after delivery of notice of
nonpayment from Landlord to Tenant. Any subsequent failure to pay Rent during
such twelve month period shall not require any such notice in order to establish
an Event of Default. Any notice delivered pursuant to this Section 15(a) shall
be in lieu of and not in addition to any notice required under California Code
of Civil Procedure Section 1161 et seq.
------
(b) Remedies Upon Tenant's Default. Upon an Event of Default,
------------------------------
Landlord shall have the following remedies, in addition to all other rights and
remedies provided by law, equity, statute or otherwise provided in this Lease,
to which Landlord may resort cumulatively or in the alternative:
(i) Landlord may continue this Lease in full force and effect,
and this Lease shall continue in full force and effect as long as Landlord does
not terminate Tenant's right to possession, and Landlord shall have the right to
collect Rent when due. During the period Tenant is in default, Landlord may
enter the Premises and relet it, or any part of it, to third parties for
Tenant's account, provided that any Rent in excess of the Rent due hereunder
shall be payable to Landlord. Tenant shall be liable immediately to Landlord for
all costs Landlord incurs in reletting the Premises, including, without
limitation, brokers' commissions, expenses of cleaning and redecorating the
Premises required by the reletting and like costs. Reletting may be for a period
shorter or longer than the remaining Term of this Lease. Tenant shall pay to
Landlord the Rent and other sums due
-16-
<PAGE>
under this Lease on the dates the Rent is due, less the Rent and other sums
Landlord receives from any reletting. No act by Landlord allowed by this
subsection (i) shall terminate this Lease unless Landlord notifies Tenant in
writing that Landlord elects to terminate this Lease.
(ii) Landlord may terminate Tenant's right to possession of the
Premises at any time by giving written notice to that effect. No act by Landlord
other than giving written notice to Tenant shall terminate this Lease. Acts of
maintenance, efforts to relet the Premises or the appointment of a receiver on
Landlord's initiative to protect Landlord's interest under this lease shall not
constitute a termination of Tenant's right to possession. On termination,
Landlord shall have the right to remove all personal property of Tenant and
store it at Tenant's cost and to recover from Tenant as damages: (a) the worth
at the time of award of unpaid Rent and other sums due and payable which had
been earned at the time of termination; plus (b) the worth at the time of award
of the amount by which the unpaid Rent and other sums due and payable which
would have been payable after termination until the time of award exceeds the
amount of the Rent loss that Tenant proves could have been reasonably avoided;
plus (c) the worth at the time of award of the amount by which the unpaid Rent
and other sums due and payable for the balance of the Term after the time of
award exceeds the amount of the Rent loss that Tenant proves could be reasonably
avoided; plus (d) any other amount necessary to compensate Landlord for all the
detriment 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, including, without limitation, any costs or expenses incurred
by Landlord: (1) in retaking possession of the Premises, including reasonable
attorneys' fees and costs therefor; (2) maintaining or preserving the Premises
for reletting to a new tenant, including repairs or alterations to the Premises
for the reletting; (3) leasing commissions; (4) any other costs necessary or
appropriate to relet the Premises; and (5) at Landlord's election, such other
amounts in addition to or in lieu of the foregoing as may be permitted from time
to time by the laws of the State of California.
The "worth at the time of award" of the amounts referred to in subsections
(ii)(a) and (ii)(b) is computed by allowing interest at the Interest Rate, on
the unpaid Rent and other sums due and payable from the termination date through
the date of award. The "worth at the time of award" of the amount referred to in
subsection (ii)(c) is computed by discounting the amount at the discount rate of
the Federal Reserve Bank of San Francisco at the time of award, plus one percent
(1%). Tenant waives redemption or relief from forfeiture under California Code
of Civil Procedure Sections 1174 and 1179, or under any other present or future
law, if Tenant is evicted or Landlord takes possession of the Premises by reason
of any default of Tenant hereunder.
(c) Landlord's Default. Landlord shall not be deemed to be in
------------------
default in the performance of any obligation required to be performed by
Landlord hereunder unless and until Landlord has failed to perform the
obligation within thirty (30) days after receipt of written notice by Tenant to
Landlord specifying wherein Landlord has failed to perform the obligation;
provided, however, that if the nature of Landlord's obligation is such that more
than thirty (30) days are required for its performance, then Landlord shall not
be deemed to be in default if Landlord shall commence the performance within the
thirty (30) day period and thereafter shall diligently prosecute the same to
completion.
-17-
<PAGE>
16. Landlord's Right to Perform Tenant's Covenants. If Tenant shall at
----------------------------------------------
any time fail to make any payment or perform any other act on its part to be
made or performed under this Lease, Landlord may, but shall not be obligated to,
make the payment or perform any other act to the extent Landlord may deem
desirable and, in connection therewith, pay expenses and employ counsel. Any
payment or performance by Landlord shall not waive or release Tenant from any
obligations of Tenant under this Lease. All sums so paid by Landlord, and all
penalties, interest and costs in connection therewith, shall be due and payable
by Tenant on the next day after any payment by Landlord, together with interest
thereon at the Interest Rate, from that date to the date of payment thereof by
Tenant to Landlord, plus collection costs and attorneys' fees. Landlord shall
have the same rights and remedies for the nonpayment thereof as in the case of
default in the payment of Rent.
17. (Intentionally Omitted)
18. Surrender of Premises. By taking possession of the Premises, except
---------------------
as provided in Section 7, Tenant shall be deemed to have accepted the Premises
in good, clean and completed condition and repair, subject to all applicable
laws, codes and ordinances. On the expiration or early termination of this
Lease, except as provided in Section 9, Tenant shall surrender the Premises to
Landlord in its condition as of the Commencement Date, normal wear and tear
excepted. Tenant shall remove from the Premises all of Tenant's personal
property, trade fixtures and any alterations required to be removed pursuant to
Section 9. Tenant shall repair damage or perform any restoration work required
by the removal. If Tenant fails to remove any personal property, trade fixtures
or alterations after the end of the Term, Landlord may remove the property and
store it at Tenant's expense, including interest at the Interest Rate. If the
Premises are not so surrendered at the termination of this Lease, Tenant shall
indemnify Landlord against all loss or liability resulting from delay by Tenant
in so surrendering the Premises, including, without limitation, any claims made
by any succeeding tenant, losses to Landlord due to lost opportunities to lease
to succeeding tenants, and reasonable attorneys' fees and costs.
19. Holding Over. If Tenant remains in possession of all or any part of
------------
the Premises after the expiration of the Term or the termination of this Lease,
the tenancy shall be month-to-month only and shall not constitute a renewal or
extension for any further term. In such event, Base Rent shall be increased in
an amount equal to one hundred fifty percent (150%) of the Base Rent during the
last month of the Term (including any extensions), and any other sums due under
this Lease shall be payable in the amount, and at the times, specified in this
Lease. The month-to-month tenancy shall be subject to every other term,
condition, covenant and agreement contained in this Lease and Tenant shall
vacate the Premises immediately upon Landlord's request.
20. Access to Premises. Tenant shall permit Landlord and its agents to
------------------
enter the Premises at all reasonable times upon reasonable notice, except in the
case of an emergency (in which event no notice shall be necessary), to inspect
the Premises; to post Notices of Nonresponsibility and similar notices and to
show the Premises to interested parties such as prospective mortgagors,
purchasers and tenants; to make necessary alterations, additions, improvements
or repairs either to the Premises, the Building or other premises within the
Building; and to discharge Tenant's obligations hereunder when Tenant has failed
to do so within a reasonable time after written notice from Landlord. The above
rights are subject to reasonable security
-18-
<PAGE>
regulations of Tenant, and to the requirement that Landlord shall at all times
act in a manner to cause the least possible interference with Tenant's
operations.
21. Signs. The size, design, color, location and other physical aspects
-----
of any sign in or on the Building shall be subject to the CC&R's, if any, Rules
and Landlord's approval prior to installation, and to any appropriate municipal
or other governmental approvals. The costs of any permitted sign, and the costs
of its installation, maintenance and removal, shall be at Tenant's sole expense
and shall be paid within ten (10) days of Tenant's receipt of a bill from
landlord for the costs.
22. Waiver of Subrogation. Anything in this Lease to the contrary
---------------------
notwithstanding, Landlord and Tenant each hereby waives and releases the other
of and from any and all rights of recovery, claim, action or cause of action
against the other, its subsidiaries, directors, agents, officers and employees,
for any loss or damage that may occur in the Premises; to improvements to the
Premises or personal property (building contents) within the Premises; or to any
furniture, equipment, machinery, goods and supplies not covered by this Lease
which Tenant may bring or obtain upon the Premises or any additional
improvements which Tenant may construct on the Premises by reason of fire, the
elements or any other cause which is required to be insured against under this
lease, regardless of cause or origin, including negligence of Landlord or Tenant
and their agents, subsidiaries, directors, officers and employees, to the extent
insured against under the terms of any insurance policies carried by Landlord or
Tenant and in force at the time of any such damage, but only if the insurance in
question permits such a partial release in connection with obtaining a waiver of
subrogation from the insurer. Because this Section 22 will preclude the
assignment of any claim mentioned in it by way of subrogation or otherwise to an
insurance company or any other person, each party to this Lease agrees
immediately to give to each insurance company written notice of the terms of the
mutual waivers contained in this Section and to have the insurance policies
properly endorsed, if necessary, to prevent the invalidation of the insurance
coverages by reason of the mutual waivers contained in this Section.
23. Subordination.
-------------
(a) Subordinate Nature. Except as provided in subsection 23(b),
------------------
this Lease is subject and subordinate to all ground and underlying leases,
mortgages and deeds of trust which now or may hereafter affect the Premises, the
CC&R's, if any, and to all renewals, modifications, consolidations, replacements
and extensions thereof. Subject to subsection (c) below, within ten (10) days
after Landlord's written request therefor, Tenant shall execute any and all
documents required by Landlord, the lessor under any ground or underlying lease
("Lessor"), or the holder or holders of any mortgage or deed of trust ("Holder")
to make this Lease subordinate to the lien of any lease, mortgage or deed of
trust, as the case may be.
(b) Possible Priority of Lease. If a Lessor or a Holder advises
--------------------------
Landlord that it desires or requires this Lease to be prior and superior to a
lease, mortgage or deed of trust, Landlord may notify Tenant. Within seven (7)
days of Landlord's notice, Tenant shall execute, have acknowledged and deliver
to Landlord any and all documents or instruments, in the form presented to
Tenant, which Landlord, Lessor or Holder deems necessary or desirable to make
this Lease prior and superior to the lease, mortgage or deed of trust.
-19-
<PAGE>
(c) Recognition or Attornment Agreement. If Landlord or Holder
-----------------------------------
requests Tenant to execute a document subordinating this lease, the document
shall provide that, so long as Tenant is not in default, Lessor or Holder shall
agree to enter into either a recognition or attornment agreement with Tenant, or
a new lease with Tenant upon the same terms and conditions as to possession of
the Premises, which shall provide that Tenant may continue to occupy the
Premises so long as Tenant shall pay the Rent and observe and perform all the
provisions of this Lease to be observed and performed by Tenant.
24. Transfer of the Property. Upon transfer of the Property and
------------------------
assignment of this Lease, Landlord shall be entirely freed and relieved of all
liability under any and all of its covenants and obligations contained in or
derived from this Lease occurring after the consummation of the transfer and
assignment. Tenant shall attorn to any entity purchasing or otherwise acquiring
the Premises at any sale or other proceeding.
25. Estoppel Certificates. Within ten (10) days following written
---------------------
request by Landlord, Tenant shall execute and deliver to Landlord an estoppel
certificate, in the form prepared by Landlord. The certificate shall: (i)
certify that this Lease is unmodified and in full force and effect or, if
modified, state the nature of the modification and certify that this lease, as
so modified, is in full force and effect, and the date to which the Rent and
other charges are paid in advance, if any; (ii) acknowledge that there are not,
to Tenant's knowledge, any uncured defaults on the part of Landlord hereunder,
or if there are uncured defaults on the part of the Landlord, state the nature
of the uncured defaults; and (iii) evidence the status of the Lease as may be
required either by a lender making a loan to Landlord to be secured by deed of
trust or mortgage covering the Premises or a purchaser of the Property from
Landlord.
26. Mortgagee Protection. In the event of any default on the part of
--------------------
Landlord, Tenant will give notice by registered of certified mail to any
beneficiary of a deed of trust or mortgagee of a mortgage covering the Premises
and shall offer the beneficiary or mortgagee a reasonable opportunity to cure
the default, including time to obtain possession of the Premises by power of
sale or a judicial foreclosure, if such should prove necessary to effect a cure.
27. Attorneys' Fees. If either party shall bring any action or legal
---------------
proceeding for damages for an alleged breach of any provision of this Lease, to
recover rent or other sums due, to terminate the tenancy of the Premises or to
enforce, protect or establish any term, condition or covenant of this Lease or
right of either party, the prevailing party shall be entitled to recover, as a
part of the action or proceedings, or in a separate action brought for that
purpose, such attorneys' fees and court costs as may be fixed by the court or
jury. The prevailing party shall be the party which secures a final judgment in
its favor.
28. Brokers. Each party warrants and represents to the other that it
-------
has had no dealings with any real estate broker or agent in connection with the
negotiation of this Lease, except for any brokers(s) specified in the Basic
Lease Information, and that it knows of no other real estate broker or agent who
is or might be entitled to a commission in connection with this Lease. The
representing party shall indemnify and hold harmless the other from and against
any and all liabilities or expenses arising out of claims made by any other
broker or individual for commissions or fees resulting from this Lease arising
out of the action of such party.
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<PAGE>
29. Parking. Tenant shall have the right to park in the parking
-------
facilities located on the Premises. Landlord shall not be liable to Tenant, nor
shall this Lease be affected, if any parking is impaired by moratorium,
initiative, referendum, law, ordinance, regulation or order passed, issued or
made by any governmental or quasi-governmental body. Tenant acknowledges that
the area shown as "SFWD Property" on Exhibit A is not included as part of the
---------
Premises, except that the Premises does include the right to cross the SFWD
Property to park vehicles on the northwest portion of the Premises.
30. Utilities and Services. Tenant shall be solely responsible for
----------------------
obtaining and paying for all utilities and services, including heating, air
conditioning, ventilation (i.e., HVAC service contracts, janitorial and
security) in connection with the Premises. Landlord shall not be liable for, and
Tenant shall not be entitled to any abatement or reduction of Rent by reason of,
no eviction of Tenant shall result from and, further, Tenant shall not be
relieved from the performance of any covenant or agreement in this Lease because
of, Landlord's failure to furnish or Tenant's failure to obtain any such utility
or service any of the foregoing.
31. Modification for Lender. If, in connection with obtaining financing
-----------------------
for the Premises or any portion thereof, Landlord's lender shall request
reasonable modification to this Lease as a condition to such financing (which
shall not materially change Tenant's rights or obligations hereunder), Tenant
shall not unreasonably withhold, delay or defer its consent thereto, provided
such modifications do not materially affect Tenant's rights hereunder.
32. Acceptance. Delivery of this Lease, duly executed by Tenant,
----------
constitutes an offer to lease the Premises as set forth herein, and under no
circumstances shall such delivery be deemed to create an option or reservation
to lease the Premises for the benefit of Tenant. This Lease shall become
effective and binding only upon execution hereof by Landlord and delivery of a
signed copy to Tenant. Upon acceptance of Tenant's offer to lease under the
terms hereof and receipt by Landlord of the Rent for the first month of the Term
and the Security Deposit in connection with Tenant's submission of the offer,
Landlord shall be entitled to retain the sums and apply them to damages, costs
and expenses incurred by Landlord if Tenant fails to occupy the Premises. If
Landlord rejects the offer, the sums shall be returned to Tenant.
33. Use of Names. Tenant shall not use the name of the Building or the
------------
name of the business park in which the Building is located in the name or title
of its business or occupation without Landlord's prior written consent, which
consent Landlord may withhold in its sole discretion. Landlord reserves the
right to change the name of the Building without Tenant's consent and without
any liability to Landlord.
34. Recording. Neither Landlord nor Tenant shall record this Lease, nor a
---------
short form memorandum of this lease, without the prior written consent of the
other.
35. Quitclaim. Upon any termination of this Lease pursuant to its terms,
---------
Tenant, at Landlord's request, shall execute, have acknowledged and deliver to
Landlord a quitclaim deed of all Tenant's interest in the Premises, Building and
Property created by this Lease.
-21-
<PAGE>
36. Notices. Any notice or demand required or desired to be given under
-------
this Lease shall be in writing and shall be given by hand delivery, telecopy or
the United States mail. Notices which are sent by telecopy shall be deemed to
have been given upon receipt. Notices which are mailed shall be deemed to have
been given when seventy-two (72) hours have elapsed after the notice was
deposited in the United States mail, registered or certified, the postage
prepaid, addressed to the party to be served. As of the date of execution of
this Lease, the addresses of Landlord and Tenant are as specified in the Basic
Lease Information. Either party may change its address by giving notice of the
change in accordance with this Section.
37. Landlord's Exculpation. In the event of default, breach or violation
----------------------
by Landlord (which term includes Landlord's partners, co-venturers and co-
tenants, and officers, directors, employees, agents and representatives of
Landlord and Landlord's partners, co-venturers and co-tenants) of any of
Landlord's obligations under this Lease, Landlord's liability to Tenant shall be
limited to its ownership interest in the Building and Property or the proceeds
of a public sale of the ownership interest pursuant to the foreclosure of a
judgment against Landlord. Landlord shall not be personally liable, or liable in
any event, for any deficiency beyond its ownership interest in the Building and
Property.
38. Additional Structures. Any diminution or interference with light,
---------------------
air or view by any structure which may be erected on land adjacent to the
Building shall in no way alter this Lease or impose any liability on Landlord.
39. General.
-------
(a) Captions. The captions and headings used in this Lease are for
--------
the purpose of convenience only and shall not be construed to limit or extend
the meaning of any part of this Lease.
(b) Time. Time is of the essence for the performance of each term,
----
condition and covenant of this Lease.
(c) Severability. If any provision of this Lease is held to be
------------
invalid, illegal or unenforceable, the invalidity, illegality, or
unenforceability shall not affect any other provision of this Lease, but this
Lease shall be construed as if the invalid, illegal or unenforceable provision
had not been contained herein.
(d) Choice of Law; Construction. This Lease shall be construed and
---------------------------
enforced in accordance with the laws of the State of California. The language in
all parts of this Lease shall in all cases be construed as a whole according to
its fair meaning and not strictly for or against either Landlord or Tenant.
(e) Gender; Singular, Plural. When the context of this Lease
------------------------
requires, the neuter gender includes the masculine, the feminine, a partnership
or corporation or joint venture, and the singular includes the plural.
(f) Binding Effect. The covenants and agreements contained in this
--------------
Lease shall be binding on the parties hereto and on their respective successors
and assigns (to the extent this Lease is assignable).
-22-
<PAGE>
(g) Waiver. The waiver of Landlord of any breach of any term,
------
condition or covenant of this Lease shall not be deemed to be a waiver of the
provision or any subsequent breach of the same or any other term, condition or
covenant of this Lease. The subsequent acceptance of Rent hereunder by Landlord
shall not be deemed to be a waiver of any preceding breach at the time of
acceptance of the payment. No covenant, term or condition of this Lease shall be
deemed to have been waived by Landlord unless the waiver is in writing signed by
Landlord.
(h) Entire Agreement. This Lease is the entire agreement between
----------------
the parties, and there are no agreements or representations between the parties
except as expressed herein. Except as otherwise provided herein, no subsequent
change or addition to this Lease shall be binding unless in writing and signed
by the parties hereto.
(i) Waiver of Jury. To the extent permitted by law, Tenant hereby
--------------
waives any right it may have to a jury trial in the event of litigation between
Tenant and Landlord pertaining to this Lease.
(j) Counterparts. This Lease may be executed in counterparts, each
------------
of which shall be an original, but all counterparts shall constitute one (1)
instrument.
(k) Exhibits. The Basic Lease Information and all exhibits attached
--------
hereto are hereby incorporated herein and made an integral part hereof.
(l) Addendum. The Addendum, if any, attached hereto is hereby
--------
incorporated herein and made an integral part hereof.
40. Option to Extend.
----------------
(a) Terms of Option. Provided that an Event of Default does not
---------------
exist under this Lease either at the time of exercise of the right to extend or
on the Expiration Date, Tenant shall have the non-assignable (except to an
affiliate of Tenant pursuant to Subsection 14(h)) right, at its option, to
extend this Lease for one (1) period of five (5) years ( the "Extension Term")
commencing on the Expiration Date. For purposes of this Section 40, the term
Expiration Date shall be deemed to be the last day of the original term. If
Tenant elects to extend this Lease for the Extension Term, Tenant shall give
unequivocal written notice ("Exercise Notice") of its exercise to Landlord not
less than six (6) months, nor more than nine (9) months prior to the Expiration
Date. Tenant's failure to give the Exercise Notice in a timely manner shall be
deemed a waiver of all of Tenant's rights to extend under this Section 40. The
terms, covenants and conditions applicable to the Extension Term shall be the
same terms, covenants and conditions of this Lease except that (i) Tenant shall
not be entitled to any further option to extend under this Section 40, and (ii)
the Base Rent for the Premises during the Extension Term shall be determined as
provided in subsection 40(b) below, and (iii) Landlord shall have no obligation
to improve or otherwise modify the Premises.
(b) Determination of Base Rent During Extension Term.
------------------------------------------------
(i) Agreement on Rent. Subject to the limitations of this
-----------------
Section, Landlord and Tenant agree that the Base Rent during each Extension Term
shall be equal to ninety five percent (95%) of the fair market rental value of
the Premises at the time Tenant exercises its
-23-
<PAGE>
option to extend the Term. Landlord and Tenant shall have thirty (30) days after
Landlord receives the Exercise Notice with respect to such Extension Term in
which to agree on the Base Rent during the Extension Term. In determining the
fair market rental value of the Premises during the Extension Term,
consideration shall be given to the uses of the Premises permitted under this
Lease, the quality, size, design and location of the Premises, and the rental
value of comparable space located in the proximity of the Premises. In no event
shall the Base Rent for the Extension Term be less than the Base Rent last
payable under this Lease during the last full month prior to the commencement of
the Extension Term. If Landlord and Tenant agree on the Base Rent for the
Extension Term during the thirty (30) day period, they shall immediately execute
an amendment to this Lease stating the Base Rent.
(ii) Selection of Appraisers. If Landlord and Tenant are unable
-----------------------
to agree on the Base Rent for the Extension Term within the thirty (30) day
period, then within fifteen (15) days after the expiration of the thirty (30)
day period, Landlord and Tenant each, at its cost and by giving notice to the
other party, shall appoint a competent and disinterested real estate appraiser
with at least five (5) years full-time commercial appraisal experience in area
in which the Premises is located to appraise and set the Base Rent during the
Extension Term. If either Landlord or Tenant does not appoint an appraiser
within ten (10) days after the other party has given notice of the name of its
appraiser, the single appraiser appointed shall be the sole appraiser and shall
set the Base Rent during the Extension Term. If two (2) appraisers are appointed
by Landlord and Tenant as stated in this section, they shall meet promptly and
attempt to set the Base Rent for the Extension Term. If the two (2) appraisers
are unable to agree within thirty (30) days after the second appraiser has been
appointed, they shall attempt to select a third appraiser meeting the
qualifications stated in this section within ten (10) days after the last day
the two (2) appraisers are given to set the Base Rent. If they are unable to
agree on the third appraiser, either Landlord or Tenant, by giving ten (10)
days' notice to the other party, can apply to the then president of the real
estate board of Santa Clara County, or to the Presiding Judge of the Superior
Court of Santa Clara County for, the selection of a third appraiser who meets
the qualifications stated in this section. Landlord and Tenant each shall bear
one-half (1/2) of the cost of appointing the third appraiser and of paying the
third appraiser's fee. The third appraiser, however selected, shall be a person
who has not previously acted in any capacity for either Landlord or Tenant.
(iii) Value Determined By Three (3) Appraisers. Within thirty
----------------------------------------
(30) days after the selection of the third appraiser, a majority of the
appraisers shall set the Base Rent for the Extension Term. If a majority of the
appraisers is unable to set the Base Rent within the stipulated period of time,
Landlord's appraiser shall arrange for simultaneous exchange of written
appraisals of the fair market rental value of the Premises from each of the
appraisers and the three (3) appraisals shall be added together and their total
divided by three (3); ninety five percent (95%) of the resulting quotient shall
be the Base Rent for the Premises during the Extension Term. If, however, the
low appraisal and/or the high appraisal are/is more than ten percent (10%) lower
and/or higher than the middle appraisal, the low appraisal and/or the high
appraisal shall be disregarded. If only one (1) appraisal is disregarded, the
remaining two (2) appraisals shall be added together and their total divided by
two (2); ninety five percent (95%) of the resulting quotient shall be the Base
Rent for the Premises during the Extension Term. If both the low appraisal and
the high appraisal are disregarded as stated in this Paragraph, ninety five
percent (95%) of the middle appraisal shall be the Base Rent for the Premises
during the Extension Term.
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<PAGE>
(iv) Notice to Landlord and Tenant. After the Base Rent for the
-----------------------------
Extension Term has been set, the appraisers shall immediately notify Landlord
and Tenant, and Landlord and Tenant shall immediately execute an amendment to
this Lease stating the Base Rent.
[Remainder of page intentionally left blank]
-25-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Lease as of the date first
written above.
"Landlord"
VOIT MANAGEMENT COMPANY, L.P., as Agent for
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA,
a New Jersey corporation
By /s/ Mary E. Davis
----------------------------------------------
Name Mary E. Davis
--------------------------------------------
Title Vice President
-------------------------------------------
"Tenant"
NETSCAPE COMMUNICATIONS CORPORATION
a Delaware corporation
By /s/ Peter Currie
----------------------------------------------
Name Peter Currie
--------------------------------------------
Title E.U.P., C.F.O.
-------------------------------------------
-1-
<PAGE>
EXHIBIT A
[Diagram of Premises]
-1-
<PAGE>
EXHIBIT B-1
COMMENCEMENT DATE MEMORANDUM
----------------------------
LANDLORD: THE PRUDENTIAL INSURANCE COMPANY OF AMERICA,
a New Jersey corporation
TENANT: NETSCAPE COMMUNICATIONS CORPORATION,
a Delaware corporation
LEASE DATE: November 1, 1996
PREMISES: 645 Almanor Avenue, Sunnyvale, California 94086
Pursuant to Section ___ of the above-referenced Lease, the Commencement Date
hereby is established as ____________________.
TENANT: LANDLORD:
NETSCAPE COMMUNICATIONS VOIT MANAGEMENT COMPANY, L.P.,
CORPORATION, as Agent for THE PRUDENTIAL
a Delaware corporation INSURANCE OF AMERICA,
a New Jersey corporation
By____________________________ By________________________________
Name__________________________ Name______________________________
Title_________________________ Title_____________________________
-2-
<PAGE>
EXHIBIT B-2
-----------
BASE RENT COMMENCEMENT DATE MEMORANDUM
--------------------------------------
LANDLORD: THE PRUDENTIAL INSURANCE COMPANY OF AMERICA,
a New Jersey corporation
TENANT: NETSCAPE COMMUNICATIONS CORPORATION,
a Delaware corporation
LEASE DATE: November 1, 1996
PREMISES: 645 Almanor Avenue, Sunnyvale, California 94086
Pursuant to Section 4 of the above-referenced Lease, the Base Rent Commencement
Date hereby is established as ____________________, and the Expiration Date is
hereby established as ___________________.
TENANT: LANDLORD:
NETSCAPE COMMUNICATIONS VOIT MANAGEMENT COMPANY, L.P.,
CORPORATION, as Agent for THE PRUDENTIAL
a Delaware corporation INSURANCE OF AMERICA,
a New Jersey corporation
By____________________________ By__________________________________
Name__________________________ Name________________________________
Title_________________________ Title_______________________________
-3-
<PAGE>
EXHIBIT C
---------
ADA and HVAC Improvements
Within ninety (90) days after the Commencement Date, Tenant shall cause
certain improvements shown on the report included as part of this Exhibit C as
Schedule C-1 (the "ADA Improvements") and also certain improvements to be made
to the heating, ventilation and air conditioning system servicing the Premises
(the "HVAC Improvements") to be installed on the Premises in a good and
workmanlike manner and in compliance with all laws. Landlord shall reimburse
Tenant up to $47,500 for costs incurred by Tenant in installing the ADA
Improvements and up to $75,000 for costs incurred by Tenant in installing the
HVAC Improvements as follows. Upon completion of the ADA Improvements or the
HVAC Improvements, as the case may be, Tenant shall submit to Landlord invoices
and other reasonable substantiating documentation with respect to the cost of
the completed improvements, and, within forty-five (45) days after Landlord's
receipt thereof, Landlord shall pay to Tenant the amounts requested in the
submitted invoices up to $47,500 with respect to the ADA Improvements and up to
$75,000 with respect to the HVAC Improvements, provided that the following
conditions have been satisfied: (1) on the date of such request, Tenant is not
in default (beyond the applicable cure period specified in the Lease) of
Tenant's obligations under the Lease; (2) the work and/or materials for which
reimbursement is requested has been completed in a good and workmanlike manner
and in compliance with all laws; (3) Tenant shall have delivered to Landlord
such mechanic's lien waivers as Landlord may reasonably request to assure lien-
free construction and completion of such improvements; and (4) there shall have
been no mechanic's liens, recorded against the Premises in connection with such
improvements. Notwithstanding that the actual cost of designing and installing
the ADA Improvements and/or the HVAC Improvements may exceed the $47,500 or
$75,000 amounts specified above, Landlord shall have no obligation to provide
any additional funds for such excess costs or any other improvements related
thereto or to otherwise make any improvements or modifications required under
laws related to access for disabled persons or the heating, ventilation and air
conditioning system.
-1-
<PAGE>
First Amendment to Sublease
THIS FIRST AMENDMENT (this "Amendment"), is entered into this 29 day of
November, 1999, by and between Netscape Communications, Inc., ("Netscape") and
iBeam BroadcastingCorporation, ("Subtenant").
Recitals
WHEREAS, Netscape currently leases certain premises consisting of
approximately 132,000 square feet of space located at 645 Almanor, Sunnyvale,
California (the "Premises"), pursuant to that certain Lease dated November 1,
1996, between Netscape and The Prudential Insurance Company of America
("Landlord");
WHEREAS, Netscape and Subtenant entered into that certain Sublease dated as
of November 6, 1998 (the "Sublease"), which provided for Netscape leasing to
Subtenant approximately thirty six thousand four hundred seventy nine (36,479)
square feet of space which square footage included a proportionate share of
building common; and
WHEREAS, Subtenant desires to lease additional space of the Premises from
Netscape and Netscape has agreed to lease such space to Subtenant; pursuant to
the terms and conditions hereof, as well as to correct the legal name of
Netscape.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, Netscape and Subtenant covenant and agree as follows:
1. In the introduction paragraph of the Sublease, delete "Netscape
Communications, Inc.," and replace it with "Netscape Communications
Corporation," the correct legal name of Netscape.
2. Section 1 of the Sublease is hereby amended as follows:
(i) In line 3, replace the words and number "thirty six thousand four
hundred seventy nine (36,479)" with the words and number "twenty-
nine thousand six hundred and forty-five 29,645)".
(ii) To the end of the Section add the following:
On and subject to the terms and conditions contained herein, as
amended, Netscape hereby agrees to lease to Subtenant, and
Subtenant hereby agrees to lease from Netscape, approximately
twenty eight thousand two hundred and fifty (28,250) additional
rentable square feet of space in the Premises, as indicated on
Exhibit C attached hereto and incorporated herein by this
reference (the "Additional Subleased Premises"). As of the date of
this Amendment, Subtenant is subleasing from Netscape a total of
57,895 rentable square feet of the Premises.
-1-
<PAGE>
3. Additional Rent. As of the date hereof, Subtenant's pro rata share
---------------
of Building Operating Expenses (as defined in the Sublease) shall be 47%.
Additional Rent shall be paid by Subtenant in accordance with the terms and
provisions of Section 4(ii) of the Sublease, as amended.
4. Term. Section 2 of the Sublease is hereby amended by adding the
----
following language to the end of the Section:
The term for the Additional Subleased Premises shall commence on December
1, 1999 (the "Additional Subleased Premises Commencement Date"), provided
Netscape has obtained the consent of the Landlord, and shall expire on
February 15, 2002, unless sooner terminated pursuant to any provisions
hereof. As of November 15, 1999, Subtenant shall have the right to enter
the Additional Subleased Premises to take reasonable preparatory measures
for its occupancy of the Additional Subleased Premises, including, without
limitation, the installation of its trade fixtures, furnishings, and
telephone and computer equipment. Such entry shall be subject to all of
the terms and conditions of this Sublease, as amended, except that
Subtenant shall not be required to pay any rent on account thereof until
December 1, 1999.
5. Rent.
----
(a) The first sentence of Section 4(a)(i) of the Sublease is hereby
amended by adding "for the Subleased Premises" after "Monthly base rent," and
changing ("Base Rent") to ("Subleased Premises Base Rent").
(b) Section 4(a) is hereby amended by adding the following subsection
(iii):
(iii) Base Rent for Additional Subleased Premises: Subtenant shall pay
Netscape monthly base rent for the Additional Subleased Premises (the
"Additional Subleased Premises Base Rent") in the following amounts:
Months Monthly Base Rent
12/1/99-11/30/00 $1.60/rentable square foot
12/1/00-11/30/01 $1.65/rentable square foot
12/1/01-2/15/02 $1.70/rentable square foot
6. Condition of Additional Subleased Premises. Section 6 of the Sublease
------------------------------------------
is hereby amended by adding the following language to the end of the Section:
Subtenant has used due diligence in inspecting the Additional
Subleased Premises and agrees to accept the Additional Subleased
Premises in "as-is" condition, and with all faults as of the
Additional Subleased Premises Commencement Date, without any
representation or warranty of any kind or nature whatsoever, or any
obligation on the part of Netscape to modify, improve or otherwise
prepare the Additional Subleased Premises for Subtenant's occupancy,
and by entry hereunder, Subtenant accepts the Additional Subleased
premises in their present condition and without representation or
warranty of any kind by Netscape. Subtenant hereby expressly waives
the
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<PAGE>
provisions of Section 1 of Section 1932 and Sections 1941 and 1942 of
the California Civil Code and all rights to make repairs at the
expense of Netscape as provided in Section 1942 if said civil code.
Notwithstanding the foregoing, Netscape will deliver the Additional
Subleased Premises with all building systems in good working order and
repair. Subtenant shall make no modifications or repairs to the
building HVAC system without receiving the prior written consent of
Netscape.
7. Security Deposit. Section 5 of the Sublease is hereby amended by
-----------------
adding the following language to the end of the first sentence of the Section,
prior to the words ("Security Deposit"):
for the Subleased Premises, and Subtenant shall deposit with Netscape
upon the execution of the Sublease fifty two thousand eight hundred
ninety four and 55/100 Dollars ($52,894.55) as a security deposit for
the Additional Subleased Premises, for a total security deposit of
$105,789.10 ("Security Deposit").
8. Subject to Landlord's consent to the removal of the demising wall,
Netscape hereby agrees to pay one-half of the cost of removing the demising wall
in the Additional Subleased Premises, as shown on Exhibit D attached hereto and
incorporated hereby by this reference. Notwithstanding the foregoing, in no
event shall Netscape's share of such costs exceed $6,425.00. Upon completion of
such work, Subtenant shall submit a proper invoice to Netscape for payment of
Netscape's share of such work, which invoice shall include documentation
providing Netscape with the names and addresses of all contractors,
subcontractors and materialmen who provided labor and materials in connection
with this work, final lien waivers from all such contractors, subcontractors and
materialmen covering all work and materials in connection with this work, and
proof of all required inspections and issuance of any required approvals and
sign-offs by public authorities, if necessary.
9. Netscape shall have the right to enter into the Subleased Premises for
any reason whatsoever, upon reasonable notice to Subtenant. In the event of an
emergency, Netscape shall immediately be permitted to enter into the Subleased
Premises.
10. Additional Requirements. Within 30 days of the execution of this
Amendment, Subtenant shall provide Netscape with copies of all necessary plans
and permits for any past or future construction performed or to be performed on
behalf of Subtenant. Subtenant acknowledges that the obligation to provide such
plans and permits is a material provision of this amendment and the Sublease and
failure to perform this obligation shall be a breach hereof. In the event any
repairs, modifications or alterations ("Alterations") to the Subleased Premises
or the Additional Subleased Premises do not comply with the laws, regulations
and codes relating to such Alterations and in effect at the time they were
performed, Subtenant shall undertake all necessary work to bring such
Alterations into compliance therewith. Without limiting the force and effect of
any other provisions of the Sublease or this Amendment, Subtenant shall
indemnify, defend, protect, and hold Netscape and Master Landlord harmless from
and against all Claims (as defined in Section 20 of the Sublease) which may be
brought or made against Netscape or Master Landlord or which Netscape may pay or
incur to the extent caused by
-3-
<PAGE>
Subtenant's failure to comply with the laws, regulations and codes pertaining to
the undertaking of Alterations.
11. Except as provided for in this Amendment, all references in the
Sublease to Subleased Premises, shall include both the Subleased Premises and
the Additional Subleased Premises.
12. Except as modified hereby, all terms and conditions of the Sublease
remain in full force and effect.
13. No Broker. Netscape and Subtenant each represent and warrant that they
---------
have dealt with no broker in connection with this Amendment and the transactions
contemplated hereby, except Cornish & Carey Commercial. Each party shall
indemnify, protect and hold the other party harmless from all costs and expenses
(including reasonable attorneys' fees) arising from or relating to a breach of
the foregoing representation and warranty.
-4-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first written above.
NETSCAPE SUBTENANT
NETSCAPE COMMUNICATIONS iBEAM BROADCASTING
CORPORATION CORPORATION
By: /s/ Mark Stavish By: /s/ Chris L. Dier
--------------------------- ----------------------------------
Name: Mark Stavish Name: Chris L. Dier
------------------------- --------------------------------
Title: Senior VP Title: CEO
------------------------ -------------------------------
-5-
<PAGE>
EXHIBIT 10.8
Note: Information in this document marked with an "[*]" has been omitted and
filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.
iBEAM and Microsoft
Broadband Streaming Initiative Agreement
This Broadband Streaming Initiative Agreement (the "Agreement") is entered
into and effective as of September 20, 1999 (the "Effective Date") by and
between Microsoft Corporation, a Washington corporation located at One Microsoft
Way, Redmond, WA 98052 ("Microsoft") and iBEAM Broadcasting Corporation, a
Delaware Corporation located at 645 Almanor Avenue, Sunnyvale, CA 94086
("iBEAM").
Recitals
iBEAM is an application service provider capable of delivering Internet-related
broadband multimedia applications and services for independent content providers
and corporate customers (referred to collectively as "ICPs"), including
competitively priced hosting and broadcasting services for live and on-demand
broadband Streaming Media.
Microsoft is a developer of operating system technologies and tools for the
development and serving of broadband multimedia applications and content,
including Streaming Media.
Microsoft has established a "Broadband Streaming Initiative," whereby Microsoft
desires to promote adoption of Windows Media Technologies ("WMT") for broadband
multimedia applications on the Internet.
Microsoft wishes to engage iBEAM as, and iBEAM wishes to become, a supplier and
promoter of broadband multimedia applications and services in connection with
Microsoft's upcoming Broadband Streaming Initiative.
Agreement
This Agreement is entered into with reference to the following information
("Initial Definitions Table") as well as the definitions set forth below:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
<S> <C>
iBEAM Information: Corporate Name: iBEAM Broadcasting Corporation
Place of Incorporation: Delaware
Address for Notices: 645 Almanor Avenue, Suite 100,
Sunnyvale, CA 94086
- -----------------------------------------------------------------------------------------------------
iBEAM Contact: iBEAM Contact/Title: Chris Dier, CFO
Telephone Number: (408) 523-1603
Facsimile Number: (408) 730-8937
Email: [email protected]
- -----------------------------------------------------------------------------------------------------
iBEAM Name and iBEAM Service Name(s) iBEAM Name: iBEAM Broadcasting
(for use in press release): iBEAM Service Name(s): DirectCast
- -----------------------------------------------------------------------------------------------------
</TABLE>
Microsoft Confidential & Proprietary Page 1 of 9
<PAGE>
<TABLE>
- -----------------------------------------------------------------------------------------------------
<S> <C>
iBEAM Web Site: www.ibeam.com and any successors and additional and/or
new versions of a web site owned or controlled by iBEAM
during the Term.
- -----------------------------------------------------------------------------------------------------
Term: Beginning as of the Effective Date and continuing
through September 30, 2002 unless earlier terminated in
accordance with Section 9.
- -----------------------------------------------------------------------------------------------------
</TABLE>
1. Definitions
1.1 Above the fold means the placement of Content (including an icon and/or
link) or other material on an iBEAM Web Site Page such that the material
is viewable on a computer screen at a 800 x 600 pixels resolution when the
user first accesses such web page and without having to scroll down to
view more of the web page.
1.2 Broadband Streaming Initiative ICP Participant means an ICP or other
customer designated by Microsoft in its sole discretion (including
without limitation Microsoft or any of its affiliates) to use Network
Credits in support of the Broadband Streaming Initiative as contemplated
by this Agreement.
1.3 Confidential Information means: (i) any source code of software disclosed
by either party to the other party; (ii) any trade secrets and/or other
proprietary non-public information not generally known relating to either
party's product plans, designs, costs, prices or names, finances,
marketing plans, business opportunities, personnel, research, development
or know-how; and (iii) the terms and conditions of this Agreement.
"Confidential Information" does not include information that: (i) is or
becomes generally known or available by publication, commercial use or
otherwise through no fault of the receiving party; (ii) is known and has
been reduced to tangible form by the receiving party prior to the time of
disclosure and is not subject to restriction; (iii) is independently
developed by the receiving party without the use of the other party's
Confidential Information; (iv) is lawfully obtained from a third party
that has the right to make such disclosure; or (v) is made generally
available by the disclosing party without restriction on disclosure.
1.4 Content means data, text, audio, video, graphics, photographs, artwork
and other technology and materials.
1.5 iBEAM Services means the provision of hosting, serving, broadcasting,
and/or other applications and services involving "live" and "on-demand"
broadband Streaming Media for third parties.
1.6 iBEAM Services Guidelines means the guidelines and procedures related to
this Agreement with respect to how iBEAM will be engaged by Broadband
Streaming Initiative ICP Participants to provide iBEAM Services to such
customers and will apply Network Credits against such provision of
services, as more fully described in Exhibit A.
1.7 Microsoft Software means Windows NT Server (including Windows Media
Streaming Media and Site Server 3.0) and direct successors thereto.
1.8 Network Credits means credits available to pay for iBEAM Services which
credits are equal in value to the Network Credits Fee Amount having been
paid by Microsoft from time to time during the Term, less amounts having
been applied pursuant to this
Microsoft Confidential & Proprietary Page 2
<PAGE>
Agreement to reflect the provision of iBEAM Services to Broadband
Streaming Initiative Participants, as further set forth in Section 2.1
and Exhibit A.
1.9 Streaming Media means multimedia Content that is transmitted live or held
in archive on servers and played or displayed via the Web incrementally,
or in semi-real time, such that it can be heard, viewed or received by an
end user with minimal download delays, if any.
1.10 Updates means, as to any Microsoft software, all subsequent public
releases thereof during the Term, including public maintenance releases,
error corrections, upgrades, enhancements, additions, improvements,
extensions, modifications and successor versions.
1.11 Windows Media Format means (a) the Windows Media Audio format which
encodes files with the Microsoft Audio codec (.wma extension), (b) the
proposed industry standard format referred to as the "Advanced Streaming
Format" (.asf extension), which as of the Effective Date is in
comment/revision processes within industry standards bodies, and (c) any
successors or replacements for such formats that may be designated by
Microsoft, regardless of the brand or trademark under which they are made
available from time to time.
1.12 Windows Media Player means the North American English version of the
upgrade to the Windows 95 and Windows 98 Microsoft Windows Media Player
client technology that displays Streaming Media in Windows Media Format,
other formats of Streaming Media, and other multimedia data-types, and
all successors and Updates to such technology which are commercially
released during the Term.
1.13 Windows Media Technologies or "WMT" means, collectively and
interchangeably, Windows Media Player and Windows Media Streaming Media
services for the Windows NT operating system.
All other initially capitalized terms shall have the meanings assigned to them
in this Agreement.
2. Microsoft Obligations
2.1 Network Credits Fee. Microsoft agrees to pay to iBEAM a Network Credits
Fee Amount of Five Hundred Thousand Dollars ($500,000.00), which fee will
pre-pay for iBEAM web hosting services and other iBEAM Services which
Microsoft may then use in accordance with this Agreement either for
Microsoft's internal operations or for the benefit of Broadband Streaming
Initiative ICP Participants or iBEAM customers. Microsoft will pay the
Network Credits Fee Amount of Five Hundred Thousand Dollars ($500,000.00)
in accordance with the following schedule: (a) Three Hundred Thousand
Dollars ($300,000.00) after iBEAM delivers an invoice for such amount to
Microsoft, which invoice iBEAM may deliver on or after the Effective
Date; (b) One Hundred Thousand Dollars ($100,000.00) on January 15, 2000,
and (c) One Hundred Thousand Dollars ($100,000.00) on April 15, 2000. All
amounts payable under this Agreement shall be due on a net thirty (30)
day basis. Such fees shall be refundable by iBEAM to Microsoft only to
the extent set forth in Section 9.
2.2 Deployment Support. During the Term, and at no charge to iBEAM, Microsoft
shall provide high-level technical support in the United States from
Microsoft's developer relations group or product support group in order
to assist iBEAM with carrying out its obligations under this Agreement
(with Microsoft selecting in its discretion which of these groups will
provide support). Such support shall include providing reasonable on-site
deployment support services to iBEAM, provided that Microsoft shall be
entitled to charge iBEAM at its then-current rates for any such on-site
Microsoft Confidential & Proprietary Page 3
<PAGE>
deployment support services which exceed a cumulative total of [*]
person-weeks (i.e., a total of [*] hours).
2.3 Promotion of iBEAM's Services. In conjunction with its Broadband
Streaming Initiative, Microsoft agrees to publicly announce that iBEAM is
a Microsoft recommended solution provider for ICPs who are using WMT to
run high bandwidth Streaming Media applications in a manner commercially
similar to the level of promotion provided to the other application
service providers who are Broadband Streaming Initiative Participants.
Thereafter, during the Term, Microsoft will use commercially reasonable,
good faith efforts to include and promote iBEAM as a provider of hosting
and other applications and services related to Streaming Media, including
without limitation as part of Microsoft's applicable marketing efforts
and materials, sales training, Web sites, and other promotions,
consistent with Microsoft's promotion of other Broadband Streaming
Initiative application service providers which have entered into
agreements with Microsoft on similar terms to this Agreement.
2.4 Early Releases. During the Term, Microsoft will provide to iBEAM, at no
charge, successive pre-commercial releases (beta, and where practical as
determined by Microsoft in its sole discretion, pre-beta) of Microsoft
Software in object code form; provided, however, that nothing herein
shall be deemed to require that Microsoft release any additional versions
of the Microsoft Software during the Term. Any Microsoft Software
provided hereunder may be used by iBEAM only in accordance with the
confidentiality and license agreements accompanying such Microsoft
Software and, in addition, may be used solely in connection with
supporting the provision of iBEAM Services that use Windows Media
Technologies. iBEAM understands that pre-release software is not intended
for full scale commercial use.
2.5 Preconditions for Microsoft Sponsorship and Support Obligations. Each of
Microsoft's obligations under this Section 2 is expressly conditioned
upon iBEAM's performance of its obligations under Sections 3.1 through
3.5 throughout the Term. In addition, because iBEAM has not fully
formulated and shared with Microsoft its plans for the iBEAM Services as
of the Effective Date, iBEAM agrees to confer in good faith with
Microsoft promptly after the Effective Date in order to develop and set
forth in writing, no later than ninety (90) days after the Effective
Date, mutually approved performance objectives (the "Performance
Criteria") for iBEAM's participation in the Broadband Streaming
Initiative during the first two (2) years of the Term. If Microsoft
reasonably believes that iBEAM has not met or exceeded such Performance
Criteria during the first fifteen (15) months of the Term, then Microsoft
may notify iBEAM of such determination by providing a written notice
identifying the specific Performance Criteria which iBEAM has not met,
provided that Microsoft must issue any such notice within ninety (90)
days after the fifteen (15) month anniversary of the Effective Date. If,
after receiving such a notice, iBEAM does not improve its performance
such that it meets the Performance Criteria within sixty (60) days after
receiving Microsoft's written notice hereunder, then Microsoft may in its
discretion terminate this Agreement effective thirty (30) days after
Microsoft provides written notice to iBEAM of such termination.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 4
<PAGE>
2.6 Digital Rights Management Application. To assist iBEAM in conducting an
evaluation of Microsoft's Digital Rights Management applications ("DRM")
in connection with iBEAM's services and applications related to Streaming
Media, Microsoft agrees to provide iBEAM with reasonable access to
applicable beta programs and other information on applicable new
technologies and technical support offerings, subject to Microsoft's
applicable confidentiality and license agreements.
2.7 Account Introductions. Microsoft agrees to use commercially reasonable
efforts during the first ninety (90) days after the Effective Date to
provide, on a non-exclusive basis, introductions to existing Microsoft
account contacts in order to assist iBEAM's efforts to make initial
presentations to selected Broadband Streaming Initiative ICP Participants
and appropriate ISPs with respect to participation in the Broadband
Streaming Initiative. The following is a preliminary list of anticipated
accounts as to which Microsoft agrees, if and only to the extent it has
appropriate existing contacts at such accounts as of the Effective Date,
to use commercially reasonable efforts to introduce iBEAM to, in
accordance with the foregoing sentence: [*].
2.8 International Marketing. Microsoft agrees to use commercially reasonable
efforts to provide senior iBEAM managers with reasonable access (subject
to availability) to Microsoft's applicable senior international managers
in order to provide advice on entering international markets in
connection with the Broadband Streaming Initiative. Microsoft agrees to
make commercially reasonable efforts to help iBEAM identify and make
initial executive level presentations to a mutually agreed list of tier
one international accounts.
2.9 Reservation of Rights. Except as expressly licensed pursuant to this
Agreement, iBEAM shall have no other rights in the Microsoft Software,
the Windows Media Player or any other Microsoft software, technology or
service provided to iBEAM hereunder. Microsoft retains all right, title
and interest in and to the Microsoft Software, the Windows Media Player
and any other Microsoft software, technologies and services. Nothing in
this Agreement shall be construed, by implication, estoppel or otherwise,
as granting iBEAM any rights to any Microsoft software, technology,
service or other intellectual property rights.
3 iBEAM Obligations
3.1 Use and Promotion of Windows Media Technologies. Subject to Window Media
Technologies being a competitively comparable solution to other Streaming
Media technologies (as reasonably determined by iBEAM in good faith based
on technology, price, quality and delivery timetables), throughout the
Term, including without limitation as part of iBEAM's full services
product launch, iBEAM will deploy, describe and promote Microsoft's WMT
platform and formats to prospective and actual customers [*] iBEAM may
also deploy, describe and promote other Streaming Media platforms or
formats. iBEAM agrees to hold its full services platform launch within
fifteen (15) days after Microsoft's initial public announcement of its
Broadband Streaming Initiative.
iBEAM's use and promotion of Windows Media Technologies shall further
include, without limitation:
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 5
<PAGE>
(a) Content Format. Within thirty (30) days after the Effective Date, and
continuing thereafter throughout the Term, all Streaming Media available
on the iBEAM Web Site shall be made available in Windows Media Format;
provided, however, that nothing herein shall be deemed to prevent iBEAM
from making Streaming Media available on such Web site in other formats.
(b) Deployment of New Applications and Services. Throughout the Term, iBEAM
will promote and make available to its customers all new applications and
services related to Streaming Media on WMT platforms and in Windows Media
Format concurrently with or sooner than iBEAM makes such new applications
and services available based on or in conjunction with other Streaming
Media technologies or formats, subject to the limitation that iBEAM's
obligations hereunder with respect to release schedule parity are subject
to Microsoft's providing comparable competitive offerings to other
commercially available offerings in the area of Streaming Media
technology or formats (as applicable) during the Term.
(c) Sponsorship. Beginning on the Effective Date and continuing thereafter
throughout the Term, iBEAM shall include on all pages of the iBEAM Web
Site pages that relate to or contain Streaming Media or applications
therefor a prominent "Get Windows Media Player" link logo (the "Windows
Media Sponsorship Notice") which links to a Microsoft-authorized Windows
Media Player download site, in accordance with the following terms:
(i) The Windows Media Sponsorship Notice shall appear prominently and
Above the fold on each iBEAM Web Site page that contains or
provides access to Streaming Media or that materially focuses on
any iBEAM Service.
(ii) On all pages of the iBEAM Web Site, including without limitation
those described in Section 3.1(c)(i), in the event iBEAM includes
any information or notices concerning Streaming Media
technologies or formats other than Windows Media Technologies and
Windows Media Format, the Windows Media Sponsorship Notice shall
appear on such page in a position at least as favorable in
prominence, size and positioning as any other such notice.
(iii) In all cases, the Windows Media Sponsorship Notice shall be a
minimum of 65 by 57 pixels (width by height), and shall conform
to all trademark usage standards provided by Microsoft to iBEAM
from time to time.
(iv) Microsoft shall be entitled to substitute a different hypertext
link and/or link logo as the Windows Media Sponsorship Notice,
subject to the same pixel size restrictions as are set forth in
Section 3.1(c)(iii), in place of the "Get Windows Media Player"
link logo for purposes of this Agreement, including without
limitation iBEAM's responsibilities under this Section 3.1(c),
upon Microsoft's reasonable advance written notice to iBEAM.
(d) Additional Promotions. Microsoft and iBEAM will cooperate in good faith
to identify and pursue additional opportunities for promotion of Windows
Media Technologies in conjunction with the iBEAM Services to U.S.- based
ICPs in the
Microsoft Confidential & Proprietary Page 6
<PAGE>
[*].
(e) Uses of the Get Windows Media Player Logo. All use by iBEAM of the "Get
Windows Media Player" link logo (or any successor logo(s)) in connection
with this Agreement is subject to compliance with Microsoft's guidelines
relating to the use of such logo(s). The current version of such
guidelines as of the Effective Date is set forth in Exhibit B hereto.
3.2 Provision of iBEAM Services to Broadband Streaming Initiative ICP
Participants.
(a) iBEAM agrees to provide six (6) months of iBEAM Services, to be comprised
of broadband Streaming Media hosting, distribution and broadcasting
services, at no charge (either to Microsoft or the ICP, and without
applying Network Credits against the value of such services) to each
Broadband Streaming Initiative ICP Participant that Microsoft designates
in its discretion as a participant in the Broadband Streaming Initiative;
provided, however, that such obligation shall not extend beyond the Term
of this Agreement, and the value of such no-charge services in the
aggregate for Broadband Streaming Initiative ICPs will not exceed Two
Hundred Thousand Dollars ($200,000.00) as calculated using the rates
described in Exhibit A. iBEAM will use commercially reasonable efforts to
notify Microsoft in writing at least sixty (60) days before it
anticipates exceeding the foregoing maximum value of the relevant iBEAM
Services.
(b) [*] iBEAM will install copies of the Microsoft Software and provide its
standard level of customer service for such software during the Term in
order to support ISPs which Microsoft has designated in its discretion
to participate in the Broadband Streaming Initiative. In performing the
foregoing obligations, iBeam shall maintain and comply with separate
written agreements with Microsoft and/or its licensees with respect to
installation and support of the Microsoft Software, and nothing in this
Agreement shall be deemed to authorize iBeam to install and/or support
such copies of the Microsoft Software.
(c) In addition to the obligations of iBEAM under Sections 3.2(a) and (b),
Microsoft shall be entitled to apply its prepaid Network Credits and
thereby obtain iBEAM Services for the benefit of designated ICP
Participants in accordance with this Agreement (including without
limitation Exhibit A). In the event that Microsoft authorizes iBEAM to
provide iBEAM Services that exceed in value (as calculated pursuant to
the terms set forth in Exhibit A) the value of then-existing pre-paid
balance of Network Credits, Microsoft agrees to pay iBEAM for such iBEAM
Services in accordance with iBEAM's then-current pricing to third parties
which are purchasing iBEAM Services in aggregate volumes comparable to
those being purchased by Microsoft in connection with the use of Network
Credits under this Agreement.
3.3 Promotion of Internet Radio Networks. iBEAM agrees to provide highly
------------------------------------
competitive fixed rate pricing for iBEAM Services to radio networks or
stations that iBEAM and Microsoft in
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 7
<PAGE>
their reasonable discretion mutually designate to participate in such
manner in the Broadband Streaming Initiative. [*] iBEAM shall provide such
fixed rate pricing [*] that each designated radio network or station
participates in this program, provided that such customers enter agreements
with terms equal to or greater than [*] and agree to make commercially
reasonable efforts to promote their use of iBEAM's services.
3.4 Publicity. iBEAM will work with Microsoft to develop a mutually agreeable
---------
press release to be released as soon as possible after the Effective Date,
provided that the text of such release must have been approved in writing
by each party before its release. In such release, iBEAM shall endorse
Windows Media Technologies, and Windows Media Format as being recommended
by iBEAM as its recommended platform and formats for its services and
applications. Further, subject to the limitations set forth in the next
sentence hereof, iBEAM agrees that (a) it will not release or approve any
press releases using its name or descriptions of the iBEAM Services, other
than in conjunction with promotions of Windows Media Technologies as
described above, for [*] before the initial announcement contemplated by
the previous sentence, nor for [*] following such initial announcement, and
(b) at all times during the Term, iBEAM shall not issue or approve press
releases from third parties that are inconsistent with the spirit of this
Section 3.4. Notwithstanding the restrictions set forth in the previous
sentence, iBEAM shall be entitled to perform under any contractual
obligation existing as of the Effective Date which requires iBEAM to
release or approve press releases or making other announcements during the
Term; provided, however, that to the extent iBEAM can comply with such
contractual obligations and also comply with the time limitations set forth
in the previous sentence, it shall do so. During the Term, iBEAM will also
work with Microsoft to develop and release joint press announcements,
provided that the details of each such announcement must have been approved
in writing by each party before it occurs, and iBEAM agrees to provide
Microsoft with reasonably detailed information on iBEAM's use of Microsoft
technology in its iBEAM Web Site for inclusion in a case study which iBEAM
shall be entitled to review and approve. With respect to all approvals
contemplated by this Section 3.4, the parties agree not to unreasonably
withhold or delay such approvals.
3.5 Reporting and Audits. By the tenth (10/th/) day of each calendar month
--------------------
during the Term (other than the month in which the Effective Date falls),
iBEAM shall provide a report to Microsoft setting forth the following
information concerning the previous calendar month, to the extent iBEAM's
provision of such information to Microsoft does not conflict with any
obligation of iBEAM to a customer and is reasonably available from iBEAM's
reporting systems (and provided further that if iBEAM's reporting systems
do not enable it to provide any element of such reports, iBEAM will
promptly confer in good faith with Microsoft to pursue possible ways to
enable such reporting systems to provide the requested information):
(a) The URL and number of page views for pages on the iBEAM Web Site or
third party web sites hosted by iBEAM which contain Streaming Media;
(b) The number of referrals of end users from the iBEAM Web Site or third
party web sites hosted by iBEAM to Microsoft's Windows Media Player
download site(s);
(c) Web browsing software share and Streaming Media player share
information for the iBEAM Web Site and third party web sites hosted by
iBEAM; include version information;
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 8
<PAGE>
(d) The number of streams served, including the total number of .wma, .asx
and .asf format files served, by bit rate;
(e) The average length of a user stream for a single connection to the
iBEAM Web Site and third party web sites hosted by iBEAM;
(f) The number of streams of pages with feature/streaming technology; and
(g) The average number of .wma, .wmx, and .asx files on site.
iBEAM shall provide all reports hereunder to Microsoft via Microsoft's web
reporting system located at [*], or any successor thereto.
In the event that iBEAM has failed to provide a report as described in this
Section 3.5 on or before the tenth (10/th/) day of the relevant calendar
month, then Microsoft will be entitled to suspend its performance under
this Agreement (including without limitation its payment obligations under
Section 2.1) until such report has been received. All information provided
pursuant to this Section will be deemed to be Confidential Information of
iBEAM.
3.6 Additional Trademark Use. iBEAM further agrees to use all Windows Media
------------------------
Technologies-related logos in accordance with the applicable logo program
requirements established by Microsoft in its sole discretion from time to
time. In the event that iBEAM fails to comply with Microsoft's then-current
logo requirements for participation in the Streaming Media Initiative at
any time during the Term, then Microsoft will be entitled, after providing
iBEAM with notice of breach and an opportunity to cure such breach within
thirty (30) days, to suspend its performance under this Agreement and
terminate this Agreement (including without limitation Microsoft's payment
obligations under Section 2.1) upon further written notice to iBEAM.
3.7 Technology Development and Testing Discussions. iBEAM agrees that upon
----------------------------------------------
request and subject to the parties' prior mutual written agreement with
respect to applicable intellectual property ownership and licenses, iBEAM
will make its appropriate senior technical personnel available to discuss
architecture and beta release testing matters with Microsoft in relation to
the following areas of mutual interest concerning technology development:
[*]. Microsoft agrees to provide pre-commercial releases of Microsoft
Software as specified under Section 2.4.
3.8 Digital Rights Management Applications. iBEAM intends to implement and
--------------------------------------
license Microsoft Digital Rights Management "DRM" technologies and services
in connection with the iBEAM Services, provided, however, that Microsoft
technologies and services can be rejected by iBEAM if it evaluates and in
good faith reasonably deems them not to be commercially competitive with
respect to alternatives in the areas of technology, price, quality, and
delivery timetables, taken as a whole. In the event that any such
technology or service is reasonably deemed not to be competitive, iBEAM
agrees to provide Microsoft a written notice describing in reasonable
detail the reason(s) why the Microsoft offering has been deemed not to be
competitive and the opportunity to discuss and address such shortfalls.
Upon iBEAM's final selection (if any) of Microsoft's DRM technologies and
services, the parties further agree to negotiate in good faith for a
commercially reasonable period concerning the applicable license and
support terms and concerning joint promotional efforts the parties may
engage in with respect to iBEAM's implementation of
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 9
<PAGE>
DRM, and upon entering into any such agreement iBEAM agrees that it will
deploy, describe and promote Microsoft's DRM technologies and services to
prospective and actual customers as its recommended digital rights
management solutions for iBEAM services; provided, however, that iBEAM may
also deploy, describe and promote other digital rights management solutions.
4. Additional Understandings
4.1 Corporate Solutions. Subject to Window Media Technologies being a
-------------------
competitively comparable solution to other Streaming Media technologies (as
reasonably determined by iBEAM in good faith based on technology, price,
quality and delivery timetables) iBEAM agrees to promote Microsoft Software
and Windows Media Technologies as its recommended platform and solutions
with respect to all Streaming Media-related services and solutions that
iBEAM may offer to corporate customers (e.g., to support intranets) during
the Term. iBEAM agrees to make good faith efforts to share its product and
sales plans for such marketplace with Microsoft promptly upon their
development. Microsoft acknowledges that all such prospective plans shall be
deemed to be Confidential Information of iBEAM.
4.2 International Service Rollout. iBEAM agrees to use commercially reasonable
-----------------------------
efforts to provide Microsoft [*], subject to the provisions of this Section
4.2, to [*] on then-standard commercial terms to support iBEAM's rollout of
its network and services internationally as part of joint ventures and other
affiliations in which iBEAM does not independently control technology
deployment. In all applicable iBEAM international efforts, iBEAM will
endeavor in good faith to provide Microsoft a [*] in order to implement and
license Microsoft technologies and services as referenced herein, provided,
however, that [*]. iBEAM and its international affiliates may make the final
selection based on its sole discretion in accordance with this paragraph.
4.3 Other Opportunities. iBEAM agrees to notify and offer Microsoft [*], on the
-------------------
same basis as described in Section 4.2, with respect to any and all
Streaming Media-related initiatives, applications, services and other
offerings that iBEAM may develop or offer during the Term of this Agreement.
[*]
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 10
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5. Non-Exclusive
Nothing in this Agreement shall be deemed to restrict either party's ability to
license, develop, sub-license, manufacture, deploy, support, promote, or
distribute software, Content, Streaming Media or any other format or technology,
whether or not similar to Windows Media Technologies or any iBEAM Services.
6. Confidentiality
6.1 Each party shall protect the other's Confidential Information from
unauthorized dissemination and use with the same degree of care that such
party uses to protect its own like information and in no event using less
than a reasonable degree of care. Neither party will use the other's
Confidential Information for purposes other than those necessary to
directly further the purposes of this Agreement. Neither party will
disclose to third parties the other's Confidential Information without the
prior written consent of the other party. Except as expressly provided in
this Agreement, no ownership or license rights are granted in any
Confidential Information. The other provisions of this Agreement
notwithstanding, either party will be permitted to disclose the
Confidential Information to their outside legal and financial advisors; and
to the extent required by applicable law, provided however that before
making any such required filing or disclosure, the disclosing party shall
first give written notice of the intended disclosure to the other party,
within a reasonable time from the time disclosure is requested and in any
event prior to the time when disclosure is to be made, and the disclosing
party will exercise best efforts, in cooperation with and at the expense of
the other party, consistent with reasonable time constraints, to obtain
confidential treatment for all non-public and sensitive provisions of this
Agreement, including without limitation dollar amounts and other numerical
information.
6.2 The parties' obligations of confidentiality under this Agreement shall not
be construed to limit either party's right to independently develop or
acquire products without use of the other party's Confidential Information.
Further, either party shall be free to use for any purpose the residuals
resulting from access to or work with such Confidential Information,
provided that such party shall maintain the confidentiality of the
Confidential Information as provided herein. The term "residuals" means
information in non-tangible form, which may be retained by persons who have
had rightful and good faith access to the Confidential Information,
including ideas, concepts, know-how or techniques contained therein.
Neither party shall have any obligation to limit or restrict the assignment
of such persons or to pay royalties for any work resulting from the use of
residuals. However, the foregoing shall not be deemed to grant to either
party a license under the other party's copyrights or patents.
7. Warranties and Disclaimers
7.1 Warranties. Each party warrants and covenants that it has the full power
----------
and authority to enter into and perform according to the terms of this
Agreement.
7.2 DISCLAIMERS. ANY AND ALL SOFTWARE, TECHNOLOGY, SERVICES, CONTENT, OR
-----------
INFORMATION PROVIDED BY EITHER PARTY TO THE OTHER
Microsoft Confidential & Proprietary Page 11
<PAGE>
HEREUNDER IS PROVIDED "AS IS," WITHOUT WARRANTY OF ANY KIND. EACH PARTY
DISCLAIMS ALL WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, TITLE AND NONINFRINGEMENT, WITH RESPECT TO ANY
SOFTWARE, TECHNOLOGY, SERVICES, CONTENT, OR INFORMATION PROVIDED HEREUNDER.
8. Indemnity
8.1 Indemnity. iBEAM shall, at its expense and Microsoft's request, defend
---------
any claim or action brought by a third party against Microsoft, or
Microsoft's affiliates, directors, or officers, to the extent it is based
upon a claim involving the iBEAM Services and/or the iBEAM Web Site,
including without limitation any claim that any iBEAM Services or any
Content included in or uploaded to the iBEAM Web Site infringes or violates
any copyright, patent, trademark, trade secret, right of publicity, or
other intellectual property, proprietary or contractual right of a third
party (all such claims or actions being referred to hereinafter as "iBEAM
Claims"), and iBEAM will indemnify and hold Microsoft harmless from and
against any costs, damages and fees reasonably incurred by Microsoft,
including but not limited to fees of outside attorneys and other
professionals, that are attributable to such iBEAM Claims. Microsoft shall:
(a) provide iBEAM reasonably prompt notice in writing of any such iBEAM
Claims and permit iBEAM, through counsel chosen by iBEAM, to answer and
defend such iBEAM Claims; and (b) provide the entity defending such claim
information, assistance and authority, at such entity's expense, to help
defend such iBEAM Claims. iBEAM will not be responsible for any settlement
made by Microsoft without iBEAM's written permission, which permission will
not be unreasonably withheld or delayed. Reasonable withholding of
permission may be based upon, among other factors, editorial and business
concerns. iBEAM will consult with Microsoft on the choice of any counsel
under this Section 8.1. In the event Microsoft receives any iBEAM Claim or
Microsoft has reason to believe it may be subject to any iBEAM Claim,
Microsoft shall be entitled, upon written notice to iBEAM, to suspend
performance under this Agreement (other than Microsoft's obligations under
Section 2.1) with respect to the applicable iBEAM Services, iBEAM Web Site
or Content thereon until iBEAM has taken steps to Microsoft's satisfaction
in order to address the alleged infringement. If iBEAM does not take
satisfactory steps to address the alleged infringement within fifteen (15)
days after receiving a notice from Microsoft under the foregoing sentence,
then Microsoft in its discretion may terminate this Agreement upon written
notice to iBEAM and such termination shall be deemed to be a termination
for cause for purposes of Section 9.
8.2 Settlement by iBEAM. Unless iBEAM obtains for Microsoft a complete release
-------------------
of all iBEAM Claims thereunder, iBEAM may not settle any iBEAM Claim under
this Section 8 on Microsoft's behalf without first obtaining Microsoft's
written permission, which permission will not be unreasonably withheld or
delayed. Reasonable withholding of permission may be based upon, among
other factors, the ability for Microsoft to ship any product. In the event
iBEAM and Microsoft agree to settle an iBEAM Claim, iBEAM agrees not to
disclose terms of the settlement without first obtaining Microsoft's
written permission, which will not be unreasonably withheld or delayed.
Microsoft Confidential & Proprietary Page 12
<PAGE>
9. Termination
9.1 Termination By Either Party. Either party may suspend performance and/or
---------------------------
terminate this Agreement as expressly provided elsewhere in this Agreement
or:
(a) Immediately upon written notice at any time, if the other party is in
material breach of any material warranty, term, condition or covenant
of this Agreement, other than those contained in Section 6, and fails
to cure that breach within [*] after written notice thereof; or
(b) Immediately upon written notice at any time, if the other party is in
material breach of Section 6.
9.2 Effect of Termination.
---------------------
(a) Neither party shall be liable to the other for damages of any sort
resulting solely from terminating this Agreement in accordance with its
terms.
(b) Termination of this Agreement shall not affect any other agreement
between the parties.
(c) Should either iBEAM or Microsoft terminate for cause pursuant to
Section 8.1, 9.1(a), or 9.1(b), neither party shall have any further
obligations to the other under Sections 2.1-2.9, Section 3.1-3.8, or
Section 4.1-4.3, with the exception that Microsoft shall be entitled in
its discretion either (i) to use, within [*] of such termination, any
Network Credits representing amounts previously paid by Microsoft
under this Agreement which have not been recouped via use of Network
Credits as of the termination of this Agreement; or (ii) to require
iBEAM to refund the portion of the Network Credit Fee Amount then
having been paid by Microsoft and not (as of the termination date)
used to provide iBEAM Services for the parties and purposes specified
in Section 2.1 and Exhibit A, provided that in no event shall iBEAM
be obligated to refund more than [*] of the total Network Credit Fee
Amount paid to iBEAM by Microsoft during the twelve (12) months prior
to Termination. Without limiting the generality of the foregoing,
Microsoft will have no obligation following termination of this
Agreement to make any additional payments or provide any further
services to iBEAM under Section 2 of this Agreement.
9.3 Survival. In the event of termination or expiration of this Agreement for
--------
any reason, Sections 1, 2.9, and 5-11 shall survive termination and
continue in effect in accordance with their terms.
10. Limitation Of Liabilities
IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY CONSEQUENTIAL, INDIRECT,
INCIDENTAL, PUNITIVE OR SPECIAL DAMAGES WHATSOEVER, INCLUDING, WITHOUT
LIMITATION, DAMAGES FOR LOSS OF BUSINESS PROFITS, BUSINESS INTERRUPTION, LOSS OF
BUSINESS INFORMATION, AND THE LIKE,
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 13
<PAGE>
ARISING OUT OF THIS AGREEMENT OR THE USE OF OR INABILITY TO USE THE MICROSOFT
SOFTWARE OR EITHER PARTY'S CONFIDENTIAL INFORMATION, CONTENT, OR SERVICES, EVEN
IF A PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
THIS SECTION SHALL NOT APPLY TO SECTION 6 (REGARDING CONFIDENTIALITY), NOR TO
iBEAM'S INDEMNITY OBLIGATIONS WITH RESPECT TO THIRD PARTY CLAIMS AS PROVIDED IN
SECTION 8 OF THIS AGREEMENT.
11. General Provisions
11.1 Notices. All notices and requests in connection with this Agreement shall
-------
be deemed given as of the day they are received either by messenger,
delivery service, or in the United States of America mails, postage
prepaid, certified or registered, return receipt requested. Any such
notices to iBEAM should be sent to the address set forth in the Initial
Definitions Table on the first page of this Agreement, and sent to the
attention of the iBEAM Contact named in such Initial Definitions Table. Any
such notices to Microsoft should be addressed as follows:
--------------------------------------------------
Address:
--------------------------------------------------
Microsoft Corporation
One Microsoft Way
Redmond, WA 98052-6399
Attention: Patty Jackson
--------------------------------------------------
Phone: (425)882-8080
--------------------------------------------------
Fax: (425)936-7329
--------------------------------------------------
Copy to: Law and Corporate Affairs
--------------------------------------------------
Microsoft Corporation
One Microsoft Way
Redmond, WA 98052-6399
Attention: Law & Corporate Affairs
--------------------------------------------------
Phone: (425)882-8080
--------------------------------------------------
Fax: (425)936-7409
--------------------------------------------------
or to such other address as a party may designate pursuant to this notice
provision.
11.2 Independent Parties. Nothing in this Agreement shall be construed as
-------------------
creating an employer-employee relationship, an agency relationship, a
partnership, or a joint venture between the parties.
11.3 Governing Law. This Agreement will be governed by the laws of the State of
-------------
Washington, without reference to the conflict of law principles thereof.
Any action or litigation concerning this Agreement will take place
exclusively in the federal or state courts in King County, Washington, and
the parties expressly consent to jurisdiction of and venue in such courts
and waive all defenses of lack of personal jurisdiction and forum non
conveniens
Microsoft Confidential & Proprietary Page 14
<PAGE>
with respect to such courts. iBEAM hereby agrees to service of process by
mail or other method acceptable under the laws of the State of Washington.
11.4 Attorneys' Fees. In any action or suit to enforce any right or remedy
---------------
under this Agreement or to interpret any provision of this Agreement, the
prevailing party shall be entitled to recover its costs, including
reasonable attorneys' fees.
11.5 Assignment. This Agreement and any rights or obligations hereunder may not
----------
be assigned by iBEAM (including without limitation via merger, stock
purchase, a sale of substantially all assets, or otherwise by operation of
law) without Microsoft's prior written approval which shall not be
unreasonably withheld or delayed. Notwithstanding the foregoing, iBEAM may
assign this Agreement in its entirety as part of a change in control of
iBEAM, provided that the assignee is not a software platform provider
(e.g., and without limitation, [*]) and does not develop and license
Streaming Media technologies or platforms (e.g., and without limitation
[*]); the parties further agree that it shall be deemed reasonable for
Microsoft to elect in its discretion not to approve a proposed assignment
to a software platform provider or a developer/licensor of Streaming Media
technologies or platforms. Any attempted assignment, sub-license, transfer,
encumbrance or other disposal by iBEAM which requires Microsoft's approval
and which has not been so approved will be void and will constitute a
material default and breach of this Agreement for which Microsoft may
terminate this Agreement in accordance with Section 9.1. Except as
otherwise provided, this Agreement will be binding upon and inure to the
benefit of the parties' successors and lawful assigns.
11.6 Force Majeure. Neither party shall be liable to the other under this
-------------
Agreement for any delay or failure to perform its obligations under this
Agreement if such delay or failure arises from any cause(s) beyond such
party's reasonable control, including by way of example labor disputes,
strikes, acts of God, floods, fire, lightning, utility or communications
failures, earthquakes, vandalism, war, acts of terrorism, riots,
insurrections, embargoes, or laws, regulations or orders of any
governmental entity.
11.7 Construction. If for any reason a court of competent jurisdiction finds
------------
any provision of this Agreement, or portion thereof, to be unenforceable,
that provision of the Agreement will be enforced to the maximum extent
permissible so as to effect the intent of the parties, and the remainder of
this Agreement will continue in full force and effect. Failure by either
party to enforce any provision of this Agreement will not be deemed a
waiver of future enforcement of that or any other provision. This Agreement
has been negotiated by the parties and their respective counsel and will be
interpreted fairly in accordance with its terms and without any strict
construction in favor of or against either party.
11.8 Entire Agreement. This Agreement does not constitute an offer by Microsoft
----------------
and it shall not be effective until signed by both parties. This Agreement
constitutes the entire agreement between the parties with respect to the
subject matter hereof and merges all prior and contemporaneous
communications. It shall not be modified except by a written agreement
dated subsequent to the date of this Agreement and signed on behalf of
iBEAM and Microsoft by their respective duly authorized representatives.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
Effective Date written above.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 15
<PAGE>
- ------------------------------------------------------------------------------
MICROSOFT CORPORATION IBEAM BROADCASTING
CORPORATION
- ------------------------------------------------------------------------------
By: /s/ William Poole By: /s/ Chris Dier
- ------------------------------------------------------------------------------
Name (print): William Poole Name (print): Chris Dier
- ------------------------------------------------------------------------------
Title: General Manager Title: C.F.O.
- ------------------------------------------------------------------------------
Date: 9/22/99 Date: 9/20/99
- ------------------------------------------------------------------------------
Microsoft Confidential & Proprietary Page 16
<PAGE>
EXHIBIT A
IBEAM SERVICES GUIDELINES
1. Approval of Program Participants
--------------------------------
Microsoft shall have sole discretion regarding the designation of Broadband
Streaming Initiative ICP Participants and allocation of Network Credits for use
by such entities and/or Microsoft's internal use under this Agreement.
Microsoft shall make reasonable efforts to provide Network Credits to customers
and programs that iBEAM recommends for the Broadband Streaming Initiative. In
no event shall iBEAM provide any Microsoft Confidential Information to any
customer or prospective customer except with Microsoft's express written
approval. Microsoft shall notify iBEAM from time to time in writing of approved
Broadband Streaming Initiative ICP Participants, the particular iBEAM Services
to be used by each such entity pursuant to this Agreement, and the approved
allocation of Network Credits among such entities and Microsoft (if applicable).
Microsoft and iBEAM will cooperate in good faith following the Effective Date to
develop and implement operational procedures, including prior approvals for
sales programs, to coordinate the use of Network Credits in accordance with this
Agreement.
2. Terms of Service
----------------
Notwithstanding anything to the contrary in the foregoing paragraph, the
relationship between iBEAM and any Broadband Streaming Initiative ICP
Participant shall be separate from iBEAM's relationship with Microsoft and iBEAM
shall have the right to choose, in its sole discretion, not to do business with
any Broadband Streaming Initiative ICP Participant. iBEAM shall enter into a
separate agreement, in a timely manner, with each Broadband Streaming Initiative
ICP Participant to which iBEAM intends to provide iBEAM Services pursuant to
this Agreement, and iBEAM shall perform all such iBEAM Services in a manner as
mutually agreed upon by iBEAM and each such Broadband Streaming Initiative ICP
Participant. iBEAM shall be solely responsible for all services it provides to
Broadband Streaming Initiative ICP Participants, including without limitation
the iBEAM Services, and for enforcing the terms of any services or other
agreements it enters into with Broadband Streaming Initiative ICP Participants.
At Microsoft's sole discretion, iBEAM may perform iBEAM Services for
Microsoft acting on behalf of a Broadband Streaming Initiative ICP Participant,
in which event such provision of iBEAM Services shall be subject to the terms of
this Agreement and any further services agreement that Microsoft and iBEAM may
mutually agree upon.
3. Rate Schedule
-------------
[*] Net Credits consumed by iBEAM customers shall be in accordance with
terms mutually approved by Microsoft and iBEAM and included in the operational
procedures specified in paragraph 1 above.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
Microsoft Confidential & Proprietary Page 17
<PAGE>
EXHIBIT B
Get Windows Media(TM) player
Link Logo Guidelines
Get Windows Media(TM) Player logo usage instructions
- ----------------------------------------------------
To put the logo and link on your Web site, follow these easy steps:
1. Read our policy below on using the Get Windows Media Player logo.
2. Copy the Get Windows Media Player logo.gif file image to your desktop.
[ICON APPEARS HERE]
3. Move the Get Windows Media Player logo .gif file from your desktop to your
Web server.
4. Insert the following HTML code on your Web page. Be sure to point the (IMG
SRC) to the location of the Get Windows Media Player logo .gif file on your
server:
(BR)(CENTER)
(A HREF="http://www.microsoft.com/windows/mediaplayer/download/default.
asp")
(IMG SRC="type path to logo image here" WIDTH="65"
HEIGHT="57" BORDER="0"
ALT="Get Windows Media Player" VSPACE="7")(/A)
(/CENTER)(BR)
5. You can modify this HTML code to fit your formatting as long as you follow
the guidelines outlined below.
Get Windows Media(TM) Player logo usage guidelines
--------------------------------------------------
1. Except as Microsoft may authorize elsewhere, non-Microsoft Web sites may
display only the Get Windows Media(YM) Player logo provided above ("Logo").
By downloading the Logo to your Web site, you agree to be bound by these
Policies.
2. You may only display the Logo on your Web site, and not in any other manner.
It must always be an active link to the download page for the Windows Media
Player at http://www.microsoft.com/windows/mediaplayer/download/default.asp.
3. The Logo GIF image includes the words "Get Windows Media Player" describing
the significance of the Logo on your site (that the Logo is a link to the
download page for the Microsoft Windows Media Player, not an endorsement of
your site). You may not remove or alter any element of the Logo.
4. The Logo may be displayed only on Web pages that make accurate references to
Microsoft or its products or services or as otherwise authorized by
Microsoft. Your Web page title and other trademarks and logos must appear at
least as prominently as the Logo. You may not display the Logo in any manner
that implies sponsorship, endorsement, or license by Microsoft except as
expressly authorized by Microsoft.
5. The Logo must appear by itself, with a minimum spacing (30 pixels) between
each side of the Logo and other distinctive graphic or textual elements on
your page. The Logo may not be displayed as a feature or design element of
any other logo.
6. You may not alter the Logo in any manner, including size, proportions,
colors, elements, or animate, morph, or otherwise distort its perspective or
appearance, except in the event expressly authorized by Microsoft.
Microsoft Confidential & Proprietary Page 18
<PAGE>
7. You may not display the Logo on any site that infringes any Microsoft
intellectual property or other rights, or violates any state, federal, or
international law.
8. These Policies do not grant a license or any other right to Microsoft's
logos or trademarks. Microsoft reserves the right at its sole discretion to
terminate or modify permission to display the Logo at any time. Microsoft
reserves the right to take action against any use that does not conform to
these Policies, infringes any Microsoft intellectual property or other
right, or violates other applicable law.
9. MICROSOFT DISCLAIMS ANY WARRANTIES THAT MAY BE EXPRESS OR IMPLIED BY LAW
REGARDING THE LOGO, INCLUDING WARRANTIES AGAINST INFRINGEMENT.
(C)1999 Microsoft Corporation. All rights reserved. Terms of Use.
Microsoft Confidential & Proprietary Page 19
<PAGE>
EXHIBIT 10.9
Note: Information in this document marked with an "[*]" has been omitted and
filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.
iBEAM Network Membership
Agreement No. 100599 Covad
This membership agreement (the "Agreement"), effective as of October 5, 1999
---------
(the "Effective Date"), is entered into by Covad, Inc., ("Member") and iBEAM
-------------- ----------- -----
BROADCASTING CORPORATION, a Delaware corporation with primary business offices
- -------------------------
at 645 Almanor Avenue, Suite 100, Sunnyvale, CA 94086 ("iBEAM"). (iBEAM and
Member individually a "Party" or together the "Parties")
WHEREAS, iBEAM intends to provide a paid service which provides Internet service
providers ("ISPs") with MaxCasters(TM) providing replication, live broadcast and
on-demand data streaming and,
WHEREAS, Member provides access to a high-speed network for the subscribers of
its ISP customers and,
WHEREAS, iBEAM offers and Member accepts the iBEAM service subject to the terms
and conditions set forth below.
NOW THEREFORE, for good and valuable consideration exchanged between the
Parties, Member and iBEAM agree as follows:
1. DEFINITIONS
- --------------
When used in this Agreement, the following terms shall have the following
meanings unless the subject or the context otherwise requires:
A. Content: data or data streams used in the Service.
-------
B. Webcast Distribution Service (the "Service"): The service provided by
--------------------------------------------
iBEAM, where iBEAM copies and distributes Content from a series of content
providers to iBEAM MaxCasters using communications equipment and
telecommunications services (including, but not limited to, satellite,
broadcast and other networking services).
C. Confidential Information. Confidential and trade secret information as
------------------------
set forth more specifically in Article 15 of this Agreement.
D. Disclosing Party. A Party that discloses Confidential Information to a
----------------
Receiving Party.
E. Receiving Party. A Party receiving Confidential Information from a
---------------
Disclosing Party.
F. MaxCaster(TM): A system of satellite downlink equipment, one or more
-------------
computer servers, other communications equipment and appropriate software
colocated with Member Network.
G Member Network: The network operated by Member without the installation of
---------------
the iBEAM MaxCaster(s).
H. Content Provider: a person or entity who provides Content for dissemenation
----------------
on Webcast Distribution.
I. Reseller Plan: wherein, Member will have ISP's associated with Member,
-------------
contact iBEAM and said ISP must subscribe to iBEAM's service(s).
J. Delivery Plan: wherein, Member will allow iBEAM to install its MaxCaster in
-------------
the Member Network and serve Content through iBEAM's MaxCaster and Member
Network.
K. Member ISP: An ISP who, under the Reseller Plan, has been recruited by
------------
Member and has signed a contract with iBEAM.
L. Member ISP Network: The network operated by a Member ISP without the
--------------------
installation of the iBEAM MaxCaster(s)
M. Referral: Shall mean placing iBEAM in contact with a potential iBEAM
--------
customer where contract negotiations with such potential customer begin
within ninety (90) days of the referral and such negotiations result in an
order and provision of services from iBEAM, unless such referred customer
was, as of the date of Member's referral: (a) already a customer under
contract with iBEAM; (b) already formally referred by another customer of
iBEAM; or (c) already in formal negotiations with iBEAM for services.
Subject to the foregoing, iBEAM will pay Member for Referrals as set forth
in Article 4.1
2. SERVICE
- ----------
iBEAM will provide the Service to Member and Member accepts the Service
pursuant to the terms and conditions of this Agreement and its Exhibits by
incorporation.
<PAGE>
i) Reseller Plan: To take advantage of the Reseller Plan, Member must
refer to iBEAM a Member ISP, assist iBEAM in signing said Member ISP
with iBEAM for iBEAM service and provide all reasonable assistance
required to install a MaxCaster in said Member ISP's network.
ii) Delivery Plan: To take advantage of the Delivery Plan, Member must
complete installations as set forth in Article 4.1.
3. OWNERSHIP AND USE AND DAMAGE
- ---------------------------------
3.1 Ownership: Title to and ownership of the MaxCaster(TM), all copies of
documentation or instructions thereof and all data resident upon each
MaxCaster, including but not limited to any trademarks, servicemarks,
tradedress, copyrights (whether in literal or non-literal form) and/or patents
shall be and at all times remain with iBEAM, iBEAM's licensors or its agents or
assigns. Member will not reproduce or modify the MaxCaster or any portion
thereof. Member shall not rent, sell, lease, create or have created security
interests in the MaxCaster, have liens placed on the MaxCaster or otherwise
transfer the MaxCaster or any part thereof or use, or allow its use for the
benefit of any third party that is not a customer or subscriber of Member.
3.2 Use: Member may transmit the Content resident on the MaxCaster to its end
users provided that the Content is unmodified or abridged in any manner. Member
shall not reverse assemble, reverse compile or reverse engineer the MaxCaster,
or otherwise attempt to discover any MaxCaster source code or underlying
Confidential Information (as that term is defined below). Further Member agrees
that it will not modify, copy, display, distribute, use, market, promote,
perform, cache or transmit any of the Content residing within the MaxCaster or
intercept any tranmission intended to place Content on the MaxCaster for the
heretofore mentioned reasons without the express permission of iBEAM. iBEAM may
use certain iBEAM defined shared elements of the MaxCaster for other services or
customers.
3.3 In the event that Member breaches any provision of Articles 3.1 or 3.2
iBEAM shall have the right to bring immediate injunctive action to halt said
breach.
Damage to MaxCaster: Any damage caused to any portion of the MaxCaster while
resident at Member location by use outside the scope intended under this
Agreement will require Member to pay iBEAM to repair or replace the
MaxCaster.(TM)
4. METHOD OF PAYMENT
- ---------------------
4.1 iBEAM owns all right, title and interest in and to any and all revenues
associated with all services, provided by iBEAM, which are transferred through
the MaxCaster(TM) to the Member Network. Pursuant to the Delivery Plan iBEAM
shall pay Member [*] percent ([*]%) of all revenues created from the transport
of Content through the Member Network from all iBEAM MaxCasters co-located in
Member Network upon completion of one (1) installation. Upon completion of five
(5) installations iBEAM shall pay Member an additional percent ([*]%) of all
revenues created from the transport of Content through the Member Network from
all iBEAM MaxCasters co-located in Member Network. Pursuant to the Reseller
Plan, iBEAM will pay [*] percent ([*]%) of all revenues created from the
transport of Content through the Member ISP's Networks from all iBEAM MaxCasters
co-located in each Member ISP's Network. In the event that Member provides iBEAM
with a Referral for a content provider or other customer for the Service, Member
will receive an additional [*] ([*]) percent of such referred customer's revenue
accrued to iBEAM for transport of content through Member's Network from all
iBEAM MaxCasters co-located in Member Network, for a period of twelve (12)
months from the date of Service installation for such customer or fifty (50)
percent of said customers contract term whichever is less.
4.2 iBEAM will tender to Member a summary of all shared revenues as specified in
Article 4.1 on a calendar quarterly basis. Member will then invoice iBEAM for an
amount equal to the aforementioned summary, which shall be payable net 30 days
from iBEAM receipt of said valid invoice.
4.3 Member is responsible for any taxes associated with any revenues shared
hereunder
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
<PAGE>
5 LIMITATION OF LIABILITY , WARRANTIES AND DISCLAIMER OF WARRANTIES
- --------------------------------------------------------------------
5.1 NEITHER PARTY SHALL BE RESPONSIBLE OR LIABLE WITH RESPECT TO ANY SUBJECT
MATTER OF THIS AGREEMENT OR TERMS AND CONDITIONS RELATED THERETO, TO THE OTHER
OR ANY OTHER THIRD PARTY, UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR
OTHER THEORY(A) FOR ANY MONIES IN EXCESS OF $1,000,000.00, (B) FOR LOSS OR
INACCURACY OF DATA , COST OF PROCUREMENT OF SUBSTITUTE GOODS, SERVICES OR
TECHNOLOGY, OR (C) FOR ANY INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES
INCLUDING, BUT NOT LIMITED TO LOSS OF REVENUES AND LOSS OF PROFITS. NEITHER
PARTY SHALL BE RESPONSIBLE FOR ANY MATTER BEYOND ITS REASONABLE CONTROL.
UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY
THIRD PARTY FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY
DAMAGES, ARISING FROM ANY ACT OR OMISSION, INCLUDING NEGLIGENT ACTS OR
OMISSIONS, OF THAT PARTY, EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES, ARISING FROM ANY PROVISION OF THIS AGREEMENT, SUCH AS, BUT NOT
LIMITED TO LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST BUSINESS.
5.2 IBEAM UNDERTAKES THAT ITS EQUIPMENT SHALL HAVE THE ABILITY TO DISTRIBUTE
CONTENT IN THE FOLLOWING MANNER. IN THE EVENT IBEAM IS UNABLE TO DELIVER CONTENT
IT SHALL BE DEEMED AN "UNAVAILABILITY EVENT". IBEAM WILL PROVIDE ITS WEBCAST
DISTRIBUTION FREE FROM UNAVAILABILITY EVENTS 99.9% OF THE TIME AS AGGREGATED
OVER 12 MONTHS ("AVAILABILITY CALCULATION"). REGULARLY SCHEDULED, OR EMERGENCY
MAINTENANCE EVENTS, OR MEMBER CAUSED OUTAGES OR DISRUPTIONS SHALL NOT CONSTITUTE
UNAVAILABILITY EVENTS. FURTHER, UNAVAILABILITY EVENTS DO NOT INCLUDE ANY LOSS OF
SERVICE OF ANY TYPE AS A RESULT OF ANY EVENT OR CONDITION NOT WHOLLY WITHIN THE
CONTROL OF IBEAM. CONTENT PROVIDER MUST REPORT UNAVAILABILITY EVENTS TO IBEAM
CONTENT PROVIDER SERVICE WITHIN SEVEN (7) DAY OF SAID EVENT. FOLLOWING IBEAM
RECEIPT OF CONTENT PROVIDER REPORT OF THE UNAVAILABILITY EVENT, IBEAM WILL
ATTEMPT TO CONFIRM SAID EVENT AND IF CONFIRMED, THE INCIDENT WILL BE RECORDED,
AND USED IN THE YEARLY SERVICE AVAILABILITY CALCULATION FOR THE CONTENT
PROVIDER. IBEAM FURTHER STATES THAT IN THE EVENT THAT IBEAM REDIRECTS TCP/IP
TRAFFIC THAT IS NOT CONTENT, AS THAT TERM IS DEFINED IN THIS AGREEMENT, IBEAM
WILL CORRECT SUCH AN ERROR WITHIN ONE HOUR. MEMBERS SOLE REMEDY FOR BREACH UNDER
THIS PROVISION WILL BE TO TERMINATE THIS AGREEMENT WITHOUT PENALTY.
5.3 EXCEPT AS SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY, AND EACH
PARTY HEREBY SPECIFICALLY DISCLAIMS ANY REPRESENTATIONS OR WARRANTIES, EXPRESS
OR IMPLIED, REGARDING THE PRODUCTS AND SERVICES CONTEMPLATED BY THIS AGREEMENT,
INCLUDING ANY IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR COURSE OF
PERFORMANCE OTHER THAN ANY REPRESENTATIONS OR WARRANTIES THAT CANNOT BE EXCLUDED
BY LAW.
5.4 IBEAM FURTHER DISCLAIMS THAT IT HAS WARRANTED THAT THE CONTENT PROVIDED
HEREUNDER IS UNDER IBEAM'S EDITORIAL CONTROL IN ANY MANNER WHATSOEVER OR THAT IT
IS NOT OBSCENE, INDECENT, OFFENSIVE OR HARMFUL TO MINORS.
5.5 Member makes no representation of warranty regarding the performance or
availability of the Member network or the timing and breadth of completion of
new network implementation, and disclaims any liability in connection herewith.
6.0 TERM AND TERMINATION
- ------------------------
6.1 This Agreement shall commence on the Effective Date and shall continue for
thirty-six (36) months. Either Party may, at its option, terminate with sixty
(60) days notice prior to the one (1) year anniversary of the
<PAGE>
Effective Date, thereafter termination may only be effectuated through a
material breach by the other party which is not cured within ten (10) days.
6.2 If this Agreement is terminated for any reason, each Party shall
expeditiously stop using, remove and/or return the other Party's proprietary
information including but not limited to Confidential Information, trademarks,
tradenames, and servicenames. Additionally, Member will disconnect all iBEAM
equipment from the Member Network, and provide iBEAM access to the equipment for
iBEAM retrieval of said equipment.
6.3 In the event that this Agreement terminates for any reason, the following
Articles shall survive the termination: Articles 5 and 15.
7. INTERPRETATION
- -----------------
7.1 Changes: All changes to this Agreement must be in writing, signed by each
Party and reference this Agreement and the Effective Date.
7.2 Order of Precedence: The terms and conditions of this Agreement shall
take precedence over those set forth within each Exhibit, Addendum or other
written document, signed by both parties and specified as an addition or change
to this Agreement.
CUMULATIVE
- ----------
8.1 The waiver by either Party of a breach or default by the other Party of
any of the provisions of this Agreement shall not be construed as a waiver of
any succeeding breach or default of the same or any other provisions of this
Agreement and shall not impair the exercise of any rights accruing to it under
this Agreement thereafter; nor shall any delay or omission on the part of either
Party to exercise or avail itself of any rights accruing to it under this
Agreement operate as a waiver of any breach or default by the other Party of any
of the said provisions.
8.2 All rights and remedies provided in this Agreement are cumulative and are
not exclusive of any rights or remedies provided by law.
9 NOTICES
- ----------
All communications in connection with this Agreement shall be in writing and may
be given by telecopy or mail to the recipient at the address set out in this
Agreement and sent to the attention of General Counsel or Chief Financial
Officer.
10 COSTS
- ---------
Each Party shall bear its own legal, accounting and other costs, charges and
expenses of and incidental to this Agreement.
11 DENIAL OF PARTNERSHIP
- ------------------------
Nothing herein contained shall be construed as creating the relationship of
partnership, joint venture, fiduciary relationship or principal and agent
between the parties. Neither Party may pledge or purport to pledge the credit
of the other Party or make or purport to make any representations, warranties or
undertakings for the other Party.
12 FORCE MAJEURE
- ----------------
12.1 Where a Party is unable, wholly or in part, by reason of force majeure, to
carry out any obligations under this Agreement that obligation is suspended so
far as it is affected by force majeure during the continuance thereof.
12.2 In this Agreement, "force majeure" means an act of God, strike, lockout or
other interference with work, war declared or undeclared, blockade, disturbance,
lightning, fire, earthquake, storm, flood, explosion, network failures, error in
the coding of electronic files, software limitations, or inability to obtain
telecommunications services, governmental or quasi-governmental restraint
expropriation prohibition intervention direction or embargo, unavailability or
delay in availability of equipment or transport, inability or delay in obtaining
governmental or quasi-governmental approvals consents permits licenses
authorities or allocations, and any other cause whether of the kind specified
above or otherwise which is not reasonably within the control of the Party
affected.
13 ASSIGNMENT
- -------------
Except for (i) assignment to a successor who acquires substantially all of the
assets and business of iBEAM or Member, (ii) assignment to a subsidiary company,
parent company, or subsidiary of a parent company, or (iii) assignment, pledge,
or transfer by iBEAM of any interest in any payments to be received by iBEAM
hereunder, neither party hereto may assign this Agreement or any portion thereof
without the prior written consent of the other. Any assignment permitted
hereunder or otherwise agreed to by the other Party hereto will not relieve the
<PAGE>
assigning party of any obligations with respect to any covenant, condition, or
obligation required to be performed by the assigning Party under this Agreement
14 PROMOTION AND PUBLIC ANNOUNCEMENT
- ------------------------------------
14.1 Each Party shall have the right to make public announcements and/or press
releases using the other Party's name provided they have obtained prior written
approval, which shall not be unreasonably withheld.
14.2 iBEAM may offer Member certain tradenames and/or logos for use on
Member's Internet web site. Member may use these tradenames and/or logos only if
Member agrees to and abides by all usage requirements set forth within the
download area containing these tradenames and/or logos. Notwithstanding anything
to the contrary Member agrees to remove these tradenames and/or logos, from any
Member owned, operated or run in the name of, equipment or storage device within
twenty four (24) hours of receiving a request by iBEAM to remove said tradenames
and/or logos.
15 CONFIDENTIALITY
- ------------------
15.1 Each Party acknowledges that during the contractual relationship created
under the Agreement, situations may arise which require that they be given
access to Confidential Information (as defined more specifically in Article
15.2) owned by the other Party, its suppliers or customers.
15.2 The Receiving Party of the Confidential Information recognizes that the
Disclosing Party has a proprietary interest in maintaining the confidentiality
of such Confidential Information. The Receiving Party shall not, during the
term of this Agreement and for three (3) years after the termination of this
Agreement disclose any Confidential Information of the Disclosing Party to any
third party or use any Confidential Information for its benefit or for the
benefit of any third party except as permitted herein or to further the purposes
of this Agreement. The Receiving Party shall take reasonable precautions to
maintain the confidentiality of all Confidential Information, and in no case
lesser precautions that Receiving Party takes with its own similar Confidential
Information. Upon termination of this Agreement for any reason, each Party shall
immediately return or destroy all Confidential Information of the other Party in
its possession or control.
15.3 Confidential Information shall mean all information, whether in tangible
form or communicated orally, which is learned by the Receiving Party in the
course and performance of its obligations under this Agreement (i) which is
labeled or stamped Confidential (or words to that effect), (ii) which is of the
type that Receiving Party has been informed to be confidential, and (iii)
concerns the Disclosing Party's products, or contents thereof or services
(existing or potential), business affairs, pricing, suppliers, customers, and
distributors, including without limitation, customer usage data, computer
hardware and software (in existence or under development), pending patent
applications, technical, sales and business reports, technical or research
notebooks, and information and data, whether owned by the Disclosing Party or a
third party, relating to the Disclosing Party's commercial activities. Excluded
from the foregoing definition is information which: i) at the time of
disclosure, is, or, after disclosure, becomes generally known or available to
the public other than as a consequence of the Receiving Party breach of this
Agreement; ii ) was properly known or otherwise available to the Receiving Party
prior to the disclosure by the Disclosing Party; iii) was disclosed by a third
party to the Receiving Party after the disclosure by the Disclosing Party if
such third party's disclosure neither violates any obligation of the third party
to the Disclosing Party nor is a consequence of the Receiving Party's breach of
this Agreement; iv)the Disclosing Party authorizes a release.
15.4 The rights and obligations of the parties with respect to confidentiality
shall survive
termination of this Agreement.
16. ACTS BY LAW
- -----------------
Neither party shall be under any obligation to perform any service or deliver
any work should such service or delivery constitute a violation of any
applicable law.
17. GOVERNING LAW
- -----------------
This Agreement shall be governed by, and construed and enforced in accordance
with the laws of the State of California, without regards to its choice of law
provisions. The exclusive jurisdiction for any legal proceeding regarding this
Agreement shall be in the courts of the State of California and the Parties
hereto expressly submit to the jurisdiction of said courts.
18. SEVERABILITY
- ----------------
If any provision or provisions of this Agreement shall be held to be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining portions shall not in any way be affected or impaired thereby.
<PAGE>
19 INTEGRATION
- --------------
This Agreement supersedes and replaces any and all prior agreements,
understandings or arrangements, whether oral or written, heretofore made between
the Parties and relating to the subject matter hereof and constitutes the entire
understanding of the Parties with respect to the subject matter of this
Agreement. This Agreement may not be altered or amended except by an express
written agreement signed by both Parties hereto.
iBEAM Broadcasting Corporation Covad
By: /s/ Robert Davis By: /s/ Peter Clark
------------------------------ ----------------------------
Printed: Robert Davis Printed: Peter Clark
------------------------- -----------------------
Title: V.P. Sales Title: Director, Business Development
--------------------------- ------------------------------
10/5/99
<PAGE>
Exhibit A Statement of Work to Agreement No. 100599 Covad
Party Responsibilities
1. iBEAM will be responsible for the following actions:
. A satellite pre-installation site survey of the facility by phone or
at iBEAM's option at customer site.
. The installation of the satellite dish utilizing a non-penetrating
roof mount on the roof of the facility or a designated area of the
building,
. The running of coaxial cable to the data or rack room where the iBEAM
MaxCaster indoor components will be racked.
. The racking and cabling of the server and switch components of the
MaxCaster.
. Registration and pointing of the satellite system.
. The activation of the system with the iBEAM Network operations
monitoring facility. This includes adding IP Addresses, Host ID names
to the iBEAM server and to Tier 1 NOC.
. Orientation of the customer technical staff to the equipment and to
the remote monitoring process.
. [*]
. [*]
2. The Member will be responsible for the following actions for installations
into the Member Network:
. Completion of the customer data network site survey. This information
is critical to the iBEAM Tier 1 NOC in the monitoring of the MaxCaster
and to the integration of the MaxCaster in the data network. The
customer will be required to provide IP addresses, host ID names,
subnet masks, and gateway default as specified by iBEAM.
. Designate a single point of contact for satellite and network
installation issues.
. Allow iBEAM NOC to monitor traffic to the switch, server or other
equipment for the following protocols, SNMP, FTP, Telnet, Ping,
Traceroutes.
. Access to the data room for installation of the MaxCaster indoor
components and the roof structure for installation of the MaxCaster
satellite antenna. Installation must be supported by on-time access to
the install areas.
. One "ACTIVE" twisted pair "analog" telephone line for termination to
the iBEAM MaxCaster internal modem card. This is to allow for "out of
band" monitoring and control of the iBEAM system.
. Member is responsible to pull data cables between router and
MaxCaster.
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
<PAGE>
. Connection to the Member Lan/Wan Network. If a layer 4 switch solution
is utilized a connection to the bit path must be provided.
. Access to 120 Volt AC from the Rack Power distribution harness for the
server and the switch.
. Provided space is available, adequate rack space for server, switch or
other equipment. In addition, iBEAM will need to know the type and
model of racks used in the data room for determining complementary
shelves or rack guides for the server.
. Technical support and actual physical connection of the Layer 4 switch
into the bit stream and associated patching if required. The Member is
responsible for inserting the Layer 4 switch into the bit stream if
required.
. Access to MaxCaster user logs for tracking purposes such as number of
users on the network.
. UPS support for 14-Volt Amp power requirement for a period of 60
minutes to allow an orderly shutdown of the equipment.
. Keep area in which the MaxCaster is located at 80 or less degrees
Fahrenheit and 75% or less, non-condensing relative humidity.
. Alert iBEAM during power outage or any Member Network outage, whether
planned or otherwise, by telephoning iBEAM at iBEAM specified numbers.
. Inform iBEAM whether the Member network is Multicast enabled at any
time during the contractual relationship.
. Provide iBEAM optimal connectivity into Member Network as mutually
agreed by the Parties
iBEAM Broadcasting Corporation Covad
By: /S/ Robert Davis By: /S/ Peter Clark
------------------------------ --------------------------------
Printed: Robert M. Davis Printed: Peter Clark
------------------------- ---------------------------
Title: V.P. Sales Title: Director, Business Development
--------------------------- -------------------------------
Date: 10/5/99 Date: 10/5/99
---------------------------- ------------------------------
<PAGE>
Exhibit B Milestone Schedule to Agreement No. 100599 Covad
The Parties hereto will mutually agree upon a reasonable installation plan that
will detail the order and time for installation into each site. Notwithstanding
the above the Parties hereby agree to install the following numbers of sites in
the following schedule:
Milestones:
1) Upon Covad's completion of the new network implementation in each market,
the Parties hereby agree to have Initiated Installation in said market
within thirty (30) days.
2) Upon Initiated Installation, each site will achieve Complete Installation
within an additional thirty (30) days.
Initiated Installation shall mean that iBEAM has been supplied with a
completed installation check list, an analog phone connection, and all iBEAM
indoor equipment is installed and operational within Member Network.
Complete Installation shall mean that Member has obtained rights sufficient to
install all iBEAM outdoor equipment, including but not limited to a satellite
receiver and that iBEAM has installed such outdoor equipment.
iBEAM Broadcasting Corporation Covad
By: /s/ Robert Davis By: /s/ Peter Clark
----------------------------- -----------------------------
Printed: Robert Davis Printed: Peter Clark
------------------------ -------------------------
Title: V.P.-Sales Title: Director, Business Development
-------------------------- -------------------------------
Date: 10/5/99 Date: 10/5/99
--------------------------- -------------------------------
<PAGE>
Exhibit C Technical Requirements to Agreement No.100599 Covad
. Covad must approve all technical details of the iBEAM service and
equipment before installation in any Covad data centers or in the
Covad network. As iBEAM transitions its technical service from Layer 4
switching, iBEAM will warrant the suitability of the new technique for
deployment before any changes are made in field deployments in the
Covad network or with any Covad-affiliated ISP.
. iBEAM will be responsible for all technical support and service
assurance for the iBEAM equipment installed at any Covad-affiliated
ISP or in a Covad data center. iBEAM warrants that only TCP/IP traffic
destined for contracted content provider origin servers will be
redirected to the iBEAM MaxCaster. All errors in traffic routing
caused by the iBEAM equipment and configuration will be remedied by
iBEAM in no more than 1 hour after notification.
. If the iBEAM equipment is causing problems on Covad's Layer 3 network,
Covad reserves the right to disconnect the iBEAM equipment if iBEAM
cannot fix the problem in a timely fashion.
. The iBEAM equipment will be integrated into Covad's network in a
manner that is consistent with its functionality and Covad's other
design criteria.
iBEAM Broadcasting Corporation Covad
By: /s/ Robert Davis By: /s/ Peter Clark
------------------------------ ------------------------------
Printed: Robert Davis Printed: Peter Clark
------------------------- -------------------------
Title: VP-Sales Title: Director, Busines Development
--------------------------- -----------------------------
Date: 10/5/99 Date: 10/5/99
---------------------------- ----------------------------
<PAGE>
EXHIBIT 10.10
Note: Information in this document marked with an "[*]" has been omitted and
filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.
Agreement No.___________
[LOGO OF WILLIAMS]
Teleport Services Agreement
This is an agreement between Williams Vyvx Services, a business unit of Williams
Communications, Inc., ("Williams") and iBEAM Broadcasting Corporation
("Customer"), dated as of December 13, 1999, in connection with teleport
services to be provided by Williams from Williams Vyvx Teleport New York as its
primary signal path and Williams Vyvx Teleport Los Angeles as its redundant
signal path (the "Teleport(s)") to Customer (the "Agreement"). The terms of
this Agreement are as follows:
1. SERVICES. Williams shall provide Customer with the Teleport services as
--------
further described on Exhibit A-1 attached hereto and made a part hereof
(collectively referred to herein as the "Services"). From time to time and
subject to availability, changes may be made in the Services which will be
reflected in amendments to the applicable Exhibit A or the addition of
additional Exhibit As. Each amendment shall be executed by authorized
individuals of both parties. Each Exhibit A shall be part of this Agreement
and incorporated herein. All Exhibit As shall be sequentially numbered for
ease of identification, e.g., Exhibits A-1, A-2, A-3 and so forth.
2. TERM. Upon signature by both parties this Agreement shall become effective
----
on the date first set forth above and shall continue in effect until the
expiration of any Exhibit A attached hereto (the "Term").
3. LATE PAYMENT. If any payment is not received by Williams within 30 days
------------
after the date of invoice (the "Due Date"), then such overdue amount shall
be subject to late payment charges at the lower of 18% per annum or the
highest legally permissible rate of interest until the date payment is
actually received. If Customer in good faith disputes any portion of an
invoice it must pay the undisputed amount of the invoice on or before its
Due Date and provide written notice to Seller of the billing dispute at or
before the time of payment. Such notice must include documentation
substantiating the dispute. Customer's failure to notify Seller of a
dispute within one hundred-twenty (120) days after the Due Date shall be
deemed to be Customer's acceptance of such charges. The parties will make a
good faith effort to resolve billing disputes as expeditiously as possible.
If a dispute is resolved in favor of Customer, Customer shall receive an
adjustment on its next bill.
4. SUSPENSION RIGHT. In the event that Customer has failed to pay any
----------------
undisputed amount when due, Williams shall have the right to suspend
Services. Williams shall only exercise this Suspension Right by first
providing Customer with ten business days' written notice by facsimile. If
Williams receives payment from Customer of all amounts due within the ten-
day notice period, then Customer's Services shall not be suspended.
Suspension of Services does not affect Customer's obligation to pay the
Service Charges through the Term of this Agreement unless Customer
exercises its termination right as described in this Section 4. In the
event Williams suspends Customer's Services, Customer shall have the right
but not the obligation to terminate this Agreement at its sole discretion.
Customer's liability with respect to such termination shall be an amount
equal to twelve (12) months of Service from the date of termination
multiplied by the then current monthly Total Service Charge or an amount
equal to the number of months remaining in the Term multiplied by the then
current monthly Total Service Charge, whichever is less.
Page 1 of 26
<PAGE>
5. TERMINATION.
-----------
5.1 Customer shall have the right to terminate this Agreement upon a minimum of
thirty (30) days' written notice. This right to terminate may only be
exercised due to one of the following two circumstances:
a. Monthly Interruptions exceed 43 minutes in three (3) consecutive
calendar months; or
b. A second Daily Interruption in excess of 24 consecutive hours (after
the first Daily Interruption in excess of 24 consecutive hours).
Customer must exercise its right to terminate pursuant to this Section 5.1
within thirty (30) days of the circumstance giving rise to Customer's right
to terminate. This right to terminate is Customer's only right to terminate
due to excessive Interruptions, and Customer may not invoke the general
termination right as set forth in Section 5.2 due to Interruptions.
5.2 Either party may terminate this Agreement due to a material breach of this
Agreement by the other party. The non-breaching party shall provide written
notice to the breaching party of the alleged breach, and the breaching party
shall have sixty (60) days to cure the breach. If the breach has not been cured
within this sixty-day period, then the non-breaching party may terminate upon
thirty (30) days' written notice. Customer shall pay Williams in accordance with
this Agreement for all Services performed up to and including the effective date
of termination.
6. TAXES. Customer acknowledges and understands that all charges are computed
-----
exclusive of any applicable federal, state or local use, excise, gross
receipts, sales and privilege taxes, duties, fees or similar liabilities
(other than general income or property taxes), including without limitation,
any tax or charge levied to support the Universal Service Fund contemplated
by the Telecommunications Act of 1996, whether charged to or against
Williams, its suppliers or affiliates or Customer for the Service provided to
Customer ("Taxes"). Such Taxes shall be paid by Customer in addition to all
other charges provided for herein.
7. OUTAGE ALLOWANCE.
----------------
7.1 Calculation of Outage Allowance. If applicable, Williams shall grant
-------------------------------
Customer an Outage Allowance for Services as follows:
(a) For purposes of this Agreement an interruption to Services
("Interruption") will be deemed to have occurred when Services are
either not provided at all or fail to meet the requirements of the
Agreement for a period of ten aggregate minutes on any given
calendar day (the "Daily Interruption") or forty-three (43)
aggregate minutes in any given calendar month (the "Monthly
Interruption"). An Interruption begins the earlier of when Customer
notifies Williams of the Interruption or when Williams is actually
aware of the Interruption or constructively aware through
recordation of the Interruption in Williams' log files. An
Interruption will be considered to have ended when Services in
accordance with this Agreement have been restored.
(b) In the event that Williams has a Daily Interruption as set forth in
Section 7.1(a) herein, Customer shall receive a credit for the day
the Daily Interruption occurred. Such credit shall include all fees
for the day containing the Daily Interruption related to the
Primary uplink (the "Uplink Outage Allowance"), which represents
62.5% of the total daily uplink fee.
(c) In addition to the Uplink Outage Allowance, a credit will be
provided to Customer by Williams based on the outage formula below
for the actual outage minutes related to the Space Segment (the
"Space Segment Outage Allowance").
Page 2 of 26
<PAGE>
43,200 (deemed number of minutes per month)
(d) In the event Williams has a Monthly Interruption as set forth in
Section 7.1(a) herein, Customer shall receive a credit for the month
in which the Monthly Interruption took place. Such credit will include
an Uplink Outage Allowance as defined herein for the month containing
the Monthly Interruption. If Customer receives a credit for a Monthly
Interruption, Customer shall not receive credits for any Daily
Interruptions which occurred during the month in which the Monthly
Interruption occurred.
7.2 Audio/Video. Intentionally Left Blank.
------------
7.3 Exceptions to Outage Allowance. In no case shall an Outage Allowance be
-------------------------------
made for any Interruption that is a result of, or attributable in whole
or in part to:
(a) Any failure on the part of Customer to perform its material or
operational obligations pursuant to this Agreement;
(b) The failure of Customer's Signal provided by Customer or by carriers
other than Williams;
(c) The failure of transmission lines, equipment, or other facilities
provided by the Customer;
(d) The failure or nonperformance of any earth station not provided by
Williams;
(e) Reasonable periodic maintenance as approved in advance by Customer,
provided Williams provides Customer with 72 hours advance notice of
such maintenance and cumulative maintenance time does not exceed two
(2) hours per calendar month;
(f) Interference from third party transmission or usage;
(g) Cooperative testing;
(h) Sun transit outage or rain fade; or
(i) Any other act or failure to act by Customer.
7.4 Credit Memoranda. Interruptions and Outage Allowances shall be
-----------------
acknowledged by Williams through the issuance of credit memoranda. Such
memoranda shall be issued within fifteen (15) days of the close of each
calendar month and shall reflect all credit allowances accumulated by
Customer during such month. Customer may deduct from its next monthly
payment the amount specified in the credit memorandum received in the
preceding month.
7.5 Time Limitation. In no event shall Williams be liable for allowances for
---------------
interruption unless the claim for such allowance is made within fifteen
(15) days after the date of the interruption.
8. WILLIAMS' RIGHT TO RE-CONFIGURE TELEPORT. Williams shall have the right to
----------------------------------------
re-configure or relocate the Teleport. Notwithstanding the above, any re-
configuration must have minimal impact on any Customer performance
requirement, and any relocation will be within the continental United States
and will require that the two Teleports used by Customer must be at a
minimum 1000 miles apart and neither shall be located in Florida or southern
Texas.
Page 3 of 26
<PAGE>
9. RISK OF LOSS; INSURANCE.
-----------------------
9.1 Insurance Coverage. For Customer's Equipment (as defined in Exhibit A-1)
------------------
and Customer's employees on the Teleport premises, Customer will carry or cause
to be carried and maintained in force throughout the entire Term of this
Agreement insurance coverages as described in paragraphs (a) through (c) below
with insurance companies acceptable to Williams. The limits set forth below are
minimum limits and will not be construed to limit Customer's liability. All
costs and deductible amounts will be for the sole account of the Customer.
(a) Worker's Compensation insurance complying with the laws of the State
or States having jurisdiction over each employee, whether or not
Customer is required by such laws to maintain such insurance, and
Employer's Liability with limits of $500,000 each accident, $500,000
disease each employee, and $500,000 disease policy limit. If work is
to be performed in Nevada, North Dakota, Ohio, Washington, Wyoming
or West Virginia, Customer will participate in the appropriate state
fund(s) to cover all eligible employees and provide a stop gap
endorsement.
(b) Commercial or Comprehensive General Liability insurance on an
occurrence form with a combined single limit of $1,000,000 each
occurrence, and annual aggregates of $1,000,000, for bodily injury
and property damage, including coverage for blanket contractual
liability, broad form property damage, personal injury liability,
independent contractors, products/completed operations, and when
applicable the explosion, collapse and underground exclusion will be
deleted.
(c) Automobile Liability insurance with a combined single limit of
$1,000,000 each occurrence for bodily injury and property damage to
include coverage for all owned, non-owned, and hired vehicles.
9.2 Waiver of Subrogation. In each of the above described policies, 9.1(a)
---------------------
and 9.1(c), Customer agrees to waive and will require its insurers to
waive any rights of subrogation or recovery they may have against
Williams, its parent, subsidiary, or affiliated companies. Customer does
not waive and its insurers will not waive any rights of subrogation or
recovery they may have against Williams, its parent, subsidiary, or
affiliated companies under 9.1(b).
9.3 Additional Insureds. Under the policies described in Sections 9.1(b) and
-------------------
9.1(c) above, Williams, its parent, subsidiary and affiliated companies
will be named as additional insureds as respects Customer's operations
and as respects any work performed under this Agreement. Any costs
associated with naming these additional insureds will be the
responsibility of Customer. These policies will be primary insurance as
respects Williams.
9.4 Certificates of Insurance. Non-renewal or cancellation of policies
-------------------------
described above will be effective only after written notice is received
by Williams from the insurance company thirty (30) days in advance of any
such non-renewal or cancellation. Prior to commencing the Collocation
Service hereunder, Customer will deliver to Williams certificates of
insurance on an ACORD 25 or 25S form evidencing the existence of the
insurance coverages required above. In the event of a loss or claim
arising out of or in connection with the work performed under this
contract, Customer agrees, upon request of Williams, to submit the
original or a certified copy of its insurance policies for inspection by
Williams.
9.5 Risk of Loss. Williams will not insure nor be responsible for any loss or
------------
damage, regardless of cause, to property of any kind, including loss of
use thereof, owned, leased or borrowed by the Customer, or its employees,
servants or agents.
9.6 Insurance Requirement for Contractors. If Customer utilizes contractor(s)
-------------------------------------
per this Agreement, then Customer shall require such contractor(s) to
comply with these insurance requirements and supply certificates of
insurance before any work commences.
Page 4 of 26
<PAGE>
10. CONTRACT NOTICES. Any required notices pursuant to this Agreement shall be
----------------
sent by facsimile, with confirmation by overnight courier to the parties at
the following addresses:
Williams Vyvx Services, a business unit of iBEAM Broadcasting Corporation
Williams Communications, Inc. 645 Almanor Ave., Suite 100
One Williams Center, MD 26-3 Sunnyvale, CA 94086
Tulsa, OK 74172 Tel: (408)523-1600
Telephone: 918.573.5602 Fax: (408)730-8937
Fax: 918.574.6042 Attn: CFO
Attention: Contract Administration
11. OPERATIONAL NOTICES. If Customer has any technical problems with
-------------------
Customer's Equipment, Customer's signal(s) or the Services, Customer may
call the Primary Teleport at 732-969-3191 or 732-969-3610 or the Secondary
Teleport at 800-922-4424 or 909-943-5399 on a 24 x 7 basis. Williams will
communicate with Customer as promptly as possible regarding any technical
problems with Customer's Equipment, Customer's signal(s) or the Services.
For purposes of these communications from Williams, Customer agrees that
Williams should contact the operational contacts of Customer, in the order
listed in Exhibit B hereto.
Customer shall update its list of Operational Contacts with Williams as
needed. Williams shall not be responsible for any Interruptions or other
technical problems with Customer's Equipment, Customer's signal(s) or the
Services in the event that Williams has attempted to communicate with
Customer's Operational Contacts according to the information provided by
Customer to Williams and Williams is unable to establish communications
with them.
12. LIMITATION OF LIABILITY
12.1 EXCEPTING ONLY LIABILITY FOR WILLIAMS' RECKLESS OR WILLFUL
MISCONDUCT, WILLIAMS' LIABILITY ARISING OUT OF ITS PROVISION OF
SERVICES HEREUNDER, INCLUDING BUT NOT LIMITED TO LIABILITIES
ARISING OUT OF WILLIAMS' NEGLIGENCE, MISTAKES AND OMISSIONS,
INTERRUPTIONS, DELAYS, ERRORS, OR OTHER DEFECTS IN THE SERVICES OR
BREACH OF CONTRACT OR ARISING OUT OF THE FAILURE TO FURNISH
SERVICES, WHETHER CAUSED BY ACTS OF COMMISSION OR OMISSION, SHALL
BE LIMITED TO THE EXTENSION OF ALLOWANCES FOR INTERRUPTIONS AS SET
FORTH IN THIS AGREEMENT. SUCH ALLOWANCES FOR INTERRUPTION SHALL BE
THE SOLE REMEDY OF CUSTOMER, INCLUDING ANY END USER OF CUSTOMER,
AND THE SOLE LIABILITY OF WILLIAMS HEREUNDER. WILLIAMS' LIABILITY
FOR DAMAGES OR LOSSES OF ANY KIND ARISING OUT OF ITS FURNISHING
SERVICES SHALL IN NO EVENT EXCEED AN AMOUNT EQUAL TO ITS FIXED
MONTHLY OR OTHER CHARGE ALLOCABLE TO THE FAULTY OR DEFECTIVE
SERVICE.
12.2 NOTWITHSTANDING THE PROVISIONS OF THE PRECEDING SUBPARAGRAPH,
WILLIAMS SHALL NOT BE LIABLE TO CUSTOMER OR ANY END USER FOR ANY
LOSS OF, DEFECTS IN OR ANY INABILITY TO FURNISH SERVICE DUE TO
ACTS OF GOD, ACTS OF GOVERNMENT, WARS, RIOTS, STRIKES, FAILURE OF
A TRANSPONDER, FAILURE OF A SATELLITE, FAILURE OF ANY OTHER
TRANSMISSION EQUIPMENT OR OTHER CAUSES BEYOND WILLIAMS' CONTROL.
12.3 ANY AND ALL EXPRESS AND IMPLIED WARRANTIES RELATING TO THE
SERVICES, INCLUDING BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A SPECIFIC PURPOSE OR USE, ARE
EXPRESSLY DISCLAIMED. CUSTOMER SHALL DEFEND, INDEMNIFY AND HOLD
HARMLESS WILLIAMS FROM
Page 5 of 26
<PAGE>
ANY CLAIMS MADE UNDER A WARRANTY OR REPRESENTATION MADE BY
CUSTOMER TO ANY THIRD PARTY WITH RESPECT TO THE SERVICES.
12.4 EXCEPT FOR CUSTOMER'S PAYMENT OBLIGATIONS HEREUNDER, IN NO EVENT
SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INCIDENTAL OR
CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT LIMITED TO, LOST
PROFITS), REGARDLESS OF THE FORESEEABILITY THEREOF, OCCASIONED BY
THE TERMINATION OF CUSTOMER'S RIGHTS TO USE, OR THE PREEMPTION OF
OR THE FAILURE OF, OR LOSS OF TECHNICAL QUALITY OF, THE SERVICES
OR BY ANY DELAY IN COMMENCEMENT OF THIS AGREEMENT OR BY ANY OTHER
CAUSE OR MATTER WHATSOEVER.
12.5 EXCEPT FOR CUSTOMER'S PAYMENT OBLIGATIONS HEREUNDER, IN NO EVENT
SHALL CUSTOMER BE LIABLE TO WILLIAMS FOR DIRECT DAMAGES IN EXCESS
OF ONE MILLION DOLLARS.
13. CUSTOMER'S CONTENT
------------------
13.1 Responsibility for Content. Customer shall be solely responsible
--------------------------
for all content transmitted by Williams as part of the Services.
Further, Customer shall make all arrangements with other common
carriers, Customer shall make all arrangements with other common
carriers, stations, networks, sponsors, music licensing
organizations, performers, representatives or other parties for the
authorizations necessary to avail itself of the Services. Customer
shall indemnify, defend, and save harmless Williams from any
liability arising out of failure to make such arrangements.
13.2 Content Indemnity. Customer shall indemnify, defend, and save
-----------------
harmless Williams from and against all loss, liability, damage and
expense, including reasonable attorneys' fees, due to claims arising
out of the content of any programming transmitted over Williams'
facilities pursuant to this Agreement including without limitation,
any claim for libel, slander, or infringement of copyright and any
other claim resulting from any act or omission of Customer arising
from the use of Williams' facilities or the Services provided that
Customer be given immediate written notice of any such claims and of
any suits brought or threatened against Williams and authority to
assume the sole defense thereof through its own counsel and to
compromise or settle any suits so far as this may be without
prejudice to Williams' rights.
13.3 No Violation of Law. Customer shall not use the Services for an
-------------------
unlawful purpose, including (without limitation) any use which
constitutes a violation of any local, state, federal, national or
international laws. Williams shall have the right to terminate this
Agreement and the Services provided hereunder without liability to
Customer in the event that Williams, its officers, employees or
agents, becomes the subject of any investigation, or is threatened
with or made a party to any administrative proceeding or litigation,
related to the alleged illegal use of the Services by Customer.
Notwithstanding the foregoing, Williams will not terminate this
Agreement pursuant to this Section 13.3 if, immediately upon
notification by Williams of such alleged illegal use, Customer is
able to satisfy Williams subject to Williams' sole and reasonable
discretion within forty-eight (48) hours that Customer has ceased
the aforementioned alleged illegal use.
14. NO THIRD-PARTY BENEFICIARY. The provisions of this Agreement are for the
---------------------------
benefit only of the parties hereto, and no third party may seek to enforce, or
benefit from these provisions.
15. LEGAL EXPENSES. If any proceeding is brought for the enforcement of this
---------------
Agreement, or because of an alleged or actual dispute, breach, default or
misrepresentation in connection with any of the provisions of this
Page 6 of 26
<PAGE>
Agreement, the prevailing party shall be entitled to recover reasonable
attorneys' fees and other costs and expenses incurred in such action or
proceeding in addition to any other relief to which such party may be entitled.
16. FORCE MAJEURE. Notwithstanding any other provision of this Agreement,
-------------
neither Williams nor Customer shall be held liable for any delay or failure to
perform any part of this Agreement (other than non-payment of amounts due
hereunder) for any cause beyond its control and without its fault or negligence,
including but not limited to acts or omissions of civil or military authorities,
national or local emergencies, government regulations, embargoes, epidemics,
wars, terrorist acts, sabotage, riots, insurrections, fires, lightning, sun,
hail, high winds or other adverse weather conditions , explosions, nuclear
accidents, strikes, extended power blackouts, natural disasters including but
not limited to earthquakes, floods or volcanic action, failure of satellite
transponder or failure of any third party facilities, equipment or services
(outside of the control of Williams and its subcontractors) or any law,
regulation or order of any government agency or court of competent jurisdiction
affecting either of the parties hereto in the performance of their obligations
hereunder.
17. INDEPENDENT CONTRACTORS. The parties to this Agreement are independent
-----------------------
contractors, and none of the provisions of this Agreement shall be interpreted
or deemed to create any relationship between Williams and Customer other than
that of independent contractors. Without limiting the generality of the
foregoing, Williams and Customer shall have sole responsibilities for the
withholding of all federal and state income taxes, unemployment insurance tax,
social security tax and other withholding with respect to payments made by it to
its employees performing services for it under this Agreement. Neither party's
directors, officers, employees, contractors or agents shall be deemed employees
of the other party or shall be entitled to compensation or any employment
benefits of any kind provided by the other party to its employees.
18. WAIVER. No delay or failure of Williams or Customer to insist on
------
performance of any of the terms or conditions herein or to exercise any right or
privilege, or either party's waiver of any breach hereunder, shall be construed
to be a waiver thereof or a waiver of any other terms, conditions or privileges,
whether of the same or similar type.
19. GOVERNING LAW. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of New York without regard to its choice
of law provisions.
20. SEVERABILITY. If any term or provision of this Agreement shall, to any
------------
extent, be determined to be invalid or unenforceable by a court or body of
competent jurisdiction, then (a) both parties shall be relieved of all
obligations arising under such provision and this Agreement shall be deemed
amended by modifying such provision to the extent necessary to make it valid and
enforceable while preserving its intent, and (b) the remainder of this Agreement
shall be valid and enforceable.
21. SURVIVAL OF TERMS AND CONDITIONS. The terms and conditions of this
--------------------------------
Agreement which by their nature extend beyond termination of this Agreement
shall survive the expiration or termination of this Agreement to the full extent
necessary for their enforcement and for the protection of the party in whose
favor they operate.
22. COUNTERPARTS. This Agreement may be executed in counterparts, each of which
------------
shall constitute an original and all of which, when taken together, shall
constitute one agreement.
23. PARTIES BOUND BY AGREEMENT; ASSIGNMENT. This Agreement is binding upon and
--------------------------------------
shall inure to the benefit of the parties hereto and upon their respective
successors and permitted assigns. Customer may not assign this Agreement without
the prior written consent of Williams, which consent shall not be unreasonably
withheld. Notwithstanding the foregoing, upon written notice, either party may
assign to a parent, affiliate, subsidiary company and/or any entity that
acquires, substantially all the shares or assets of a Party, without the consent
of the other.
24. OUTSOURCING OF NETWORK MANAGEMENT. Should Customer establish an outsourcing
---------------------------------
relationship with a third party to manage its network, Williams agrees to work
with such third party as designated by Customer in order to facilitate optimum
performance of Customer's network.
Page 7 of 26
<PAGE>
25. ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the entire agreement
----------------------------
of the parties with respect to the subject matter hereof and supersedes any
prior understandings, oral agreements and/or writings between the parties
regarding the subjects within this Agreement. This Agreement may only be amended
or modified in writing signed by Customer and Williams.
Page 8 of 26
<PAGE>
IN WITNESS WHEREOF the parties have executed this Agreement by the hand of their
respective duly authorised officers.
WILLIAMS VYVX SERVICES, A BUSINESS UNIT iBEAM BROADCASTING CORPORATION
OF WILLIAMS COMMUNICATIONS, INC.
/s/ Laura Kenny /s/ Chris Dier
- ---------------------------------------- ----------------------------------
SIGNATURE SIGNATURE
Laura Kenny Chris L. Dier
- ---------------------------------------- ----------------------------------
PRINT NAME PRINT NAME
Sr. VP & General Manager CFO
- ---------------------------------------- ----------------------------------
TITLE TITLE
12-14-99 12/18/99
- ---------------------------------------- ----------------------------------
DATE DATE
Page 10 of 26
<PAGE>
Agreement No.______________
[LOGO OF WILLIAMS]
VYVX SERVICES
Teleport Services Agreement - Exhibit A-1
1. SERVICE DESCRIPTION. Williams shall provide to Customer the use of the
-------------------
Teleport for a dedicated use transmission, based on the terms contained herein,
to uplink Customer's signal(s) from the Teleport to Williams-provided space
segment on TelStar 7, transponder 15.
2. SERVICE INITIATION. Williams shall initiate the Services described herein
------------------
on January 4, 2000 (the "Service Initiation Date"), provided, however that
Customer has signed this Agreement no later than December 14, 1999. Customer's
obligation to pay for the Services shall begin on the Service Initiation Date.
Loral has agreed to provide a transponder for testing purposes up to a maximum
of 15 MHz, and Williams will provide the Services during a Testing Period, which
shall begin as early as possible during the week of December 13, 1999 and
continue until January 2, 2000. Loral has informed Williams that Telstar 7,
Transponder 3 has been designated for such Testing Period and service will
switch to Telstar 7, Transponder 15 on January 4, 2000.
3. TERM. The term of this Exhibit A-1 shall begin on the Service Initiation
----
Date and shall continue for a period of thirty-six (36) months, or until
December 31, 2002 (the "Original Term").
4. DEMARCATION POINT FOR SERVICES. The Demarcation Point for Services
------------------------------
described herein shall be defined as either
4.1 RF Chain Demarcation
a) X Customer provided equipment ("CPE") demarcation - the
___
DVB/ASI data stream from Customer Provided encapsulator to the
input of Williams provided modulator for all uplink services
from the Teleport.;
b) Williams provided equipment demarcation - the Telco
___
demarcation point as defined by the local loop provider (RBOC,
CAP, etc.), with Williams responsible for connectivity between
RF Chain and local loop demarcation;
4.2 Local Loop Demarcation
a) Williams provided local loop demarcation - Customer
___
premise - Williams provisions the local loop between the
Customer premise and the respective local facility, whether
that facility is a Williams POP or 3/rd/ party POP, with the
demarcation point being the Customer end of the local loop;
b) Williams provided local loop demarcation - Teleport
___
premise - For the Primary uplink out of New York, Williams
provisions the local loop between the Teleport and the
respective local facility, whether that facility is a Williams
POP or 3/rd/ party POP, with the demarcation point being the
local facility end of the local loop. Williams is responsible
for provisioning and continued operation of the local loop for
the Primary signal path as defined herein;
c) Customer provided local loop demarcation - Customer
___
premise - Customer provisions the local loop between the
Customer Premise and respective local facility, whether that
facility is a Williams POP or 3/rd/ party POP with the
demarcation point being the local facility end of the local
loop;
d) X Customer provided local loop demarcation - Teleport
___
premise - For the Redundant uplink out of Los Angeles,
Customer provisions the local loop between the Teleport and
the respective local facility, whether that facility is a
Williams POP or 3/rd/ party POP, with the demarcation point
being the Teleport end of the local loop. Customer is
responsible for provisioning, payment and continued operation
of the local loop for the Redundant signal path as defined
herein.
4.3 IXC Demarcation. Intentionally Left Blank.
4.4 "Other." Intentionally Left Blank.
Page 10 of 26
<PAGE>
5. WILLIAMS RESPONSIBILITIES. (collectively, the Service[s])
-------------------------
[CHART APPEARS HERE]
Generic Signal Path diagram
5.1 Terrestrial Fiber Connectivity:
a) Local Access. Customer Premise (City A) Intentionally Left Blank.
b) Interexchange Fiber. Intentionally Left Blank.
c) Local Access - Teleport (City Z)
City Z Customer Premise: IXC POP, 12/th/ Flr, 60 Hudson St
City Z NPA / NXX: T.B.D.
Williams Teleport: Primary - Williams Vyvx Teleport New
York, 27 Randolph Street, Carteret, NJ
07008
Circuit Type: _________ Analog X Digital
--------
Circuit Capacity: DS-3(45 Mbps)
Transmission Type: _________ Simplex X Duplex
--------
5.2 Space Segment (the "Transponders")
a) Williams shall provide two Ku-band transponders (the "Transponders") on
Telstar 7 at the 129 West orbital slot. The Transponders shall be provided
on a "ramp-up" schedule by which Customer commits to pay for increasing
amounts of the space segment on the Transponders. The ramp-up schedule is
depicted on the Ramp-Up and Pricing Schedule attached hereto as Exhibit D.
Customer's commitment for the space segment depicted on Exhibit D begins on
the first day of the first month of the respective quarter identified. With
appropriate notice, Customer may accelerate the ramp-up of space segment,
together with the corresponding charges. Once an increased level of space
segment has been activated, however, the level may not be decreased. The
full use of both Transponders as depicted on Exhibit D beginning no later
than [*] shall continue through the end of the Term of the Agreement. The
second transponder is subject to the Right of First Refusal described below
in subparagraph (c).
b) Additional bandwidth is available under the Bursting provision in Section
6.6 (b) herein.
c) Williams shall provide Customer with a Right of First Refusal on a Fully-
Protected Ku-band transponder on Telstar 7. The Right of First Refusal shall
be activated at the time Loral Skynet receives a bona fide offer for Loral's
last Fully Protected Ku-band transponder on Telstar 7. In order to implement
such Right-of-First Refusal, Williams shall provide Customer with written
notice that Loral has received such bona fide offer. If Customer chooses to
lease the transponder in question, Customer must respond, in writing, to
Williams within twenty (20) calendar days of Customer's receipt of Williams'
written notice and must begin full service on the second transponder no
later than forty-five (45) days following receipt of Williams' written
notice. The monthly rate for the second transponder shall
[*] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with respect
to the omitted portions.
- --------------------------------------------------------------------------------
Standard Form Page 11 of 26
- --------------------------------------------------------------------------------
<PAGE>
immediately be [*] without any ramp-up schedule as depicted on Exhibit D
hereto. Customer's failure to respond to Williams' notification shall be
deemed a refusal of the second transponder. This Right of First Refusal
terminates when service on the second transponder begins on [*] or when
Customer declines service under the Right of First Refusal.
(d) Williams' Standard Satellite Terms and Conditions are attached as Exhibit C
and are considered an integral part of the Agreement. In the event of
conflict, the terms of this Agreement shall supersede the terms and
conditions in Exhibit C.
5.3 Uplinking/Downlinking. Williams shall modulate Customer's DVB/ASI data
stream to 70 MHz, upconvert the signal to 14 GHz and then transmit the
signal from the Teleport to the Transponder in accordance with the
predicted performance parameters which have been established based on the
technical specifications calculated in the New York link budget attached as
Exhibit A-1(a). Customer acknowledges and agrees that any equipment
substitutions or technical changes made by Customer or Williams may affect
the attached link budget calculations and could result in corresponding
changes to the following predicted performance specifications:
Williams will provide a Primary signal path via its New York Teleport. The
Customer's signal will be transmitted from New York at a calculated power
level of 73.11 dBW to TelStar 7's Ku-band transponder 15, resulting in a
predicted downlink EIRP of 47 dBW per carrier to CONUS. Williams
understands that this signal will be received by Customer's downlink
equipment utilizing a minimum 1.0 meter antenna in CONUS providing
approximately 40 dBi gain at 12 GHz. Calculations are based on Loral Skynet
provided specifications for TelStar 7. These values assume 6 dB of rain
fade margin and 99.7% equipment availability. Additionally, these values
predict an approximate data rate capacity of 39 MBps.
Williams will provide a Redundant signal path via its Los Angeles Teleport.
The Customer's signal will be transmitted from Los Angeles at a calculated
power level of 70.34 dBW to TelStar 7's Ku-band transponder 15, resulting
in a predicted downlink EIRP of 47 dBW per carrier to CONUS. Williams
understands that this signal will be received by Customer's downlink
equipment utilizing a minimum 1.0 meter antenna in CONUS providing
approximately 40 dBi gain at 12 GHz. Calculations are based on Loral Skynet
provided specifications for TelStar 7. These values assume 6 dB of rain
fade margin and 99.7% equipment availability. Additionally, these values
predict an approximate data rate capacity of 39 MBps.
When Williams has actual knowledge that there is an outage to Customer's
Service, Williams must switch signal delivery from the Primary uplink to
the Redundant uplink as described herein. Williams will switch the signal
within five (5) minutes upon Williams' actual knowledge of the outage. To
accommodate Williams' switch of signal delivery, Customer shall maintain
the delivery of the data signal to the Redundant uplink on a continuous
basis.
It is understood and agreed to by both parties that while these initial
uplink systems do not support iBEAM's long term growth requirements,
approximately [*] MBps for a CONUS service, but they do provide sufficient
capacity for iBEAM to develop their service offering. At such time that
both parties deem this current capacity to be insufficient to meet iBEAM's
market requirements, both parties will work together to expand these
systems to support iBEAM's long term growth requirements of [*] MBps. Such
expansion of Services shall be reflected in an amendment to this Agreement.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
Uplink Uplink Downlink Downlink
Direction Data Rate Freq. Polarity Freq. Polarity Modulation FEC
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Simplex Uplink-NY 39 MBps 14300 Horizontal 12000 Vertical QPSK 3/4
MHz MHz
- ---------------------------------------------------------------------------------------------------------
Simplex Uplink-LA 39 MBps 14300 Horizontal 12000 Vertical QPSK 3/4
MHz MHz
- ---------------------------------------------------------------------------------------------------------
</TABLE>
[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
- --------------------------------------------------------------------------------
Standard Form Page 12 of 26
- --------------------------------------------------------------------------------
<PAGE>
5.4 Equipment. Williams shall provide the necessary equipment to uplink
Customer's signal(s) to/from the customer provided modem in accordance with
this Agreement. Uplink system will operate with data modulators, frequency
upconverters and High Power Amplifiers in a 1:N automatic redundancy mode
where N=4. Williams will supply an environmentally controlled facility,
including 2 19" racks for Customer's equipment and 2 POTS lines for remote
monitoring of the Customer Provided equipment at each teleport facility.
Facility power will be supplied at 120vac or 208vac. In the event of
facility power failure, all critical equipment will have power supplied by
an uninterruptable power supply with sufficient battery capacity to allow
time for William's supplied diesel generator to be automatically switched
on-line. All equipment provided by Williams shall remain the property of
Williams.
5.5 Monitor. Williams will monitor the Service, and Williams will communicate
with Customer as promptly as possible regarding any technical problems with
Customer's Equipment, Customer's signal(s) or the Services. Williams will
provide Customer with a monthly monitoring report in a form or format which
is mutually agreed to by the parties.
5.6 Basic Maintenance. Williams may provide basic maintenance to Customer based
on procedures mutually agreed upon by the parties.
6. CUSTOMER RESPONSIBILITIES.
6.1 Space Segment. Intentionally Left Blank.
6.2 Signal Delivery. Customer shall be solely responsible for delivery of its
signal(s) to/from the Demarcation Point, as defined in Section 4 above.
6.3 Uplinking/Downlinking. Intentionally Left Blank.
6.4 Customer's Equipment.
(a) For the Services described above, Customer shall provide equipment
("Customer's Equipment") to both the New York and Los Angeles Teleports
to be used in connection with Williams provision of the Services to
Customer which will perform the following functions:
2 Cisco 7206VXR Routers - The first router is for terminating ATM DS3
local loop for the purpose of passing multicast and unicast data from
Customer's broadcasting head ends into Customer's DVB encapsulators.
The second router is for redundancy.
2 Cisco 2924 Switches - The first switch is to terminate Customer's
server, router, encapsulator and terminal server equipment LAN ports,
and allows for layer 2 communication between Customer's equipment. The
second switch is for redundancy.
2 Skystream Encapsulators - The first encapsulator encapsulates
Customer's data into a DVB compliant format for delivery to Williams'
multiplexing equipment. The second encapsulator is for redundancy.
Cisco 2511 Terminal Server - Provides out of band management and remote
capability for controlling and configuring Customer owned equipment.
Customer shall provide Williams with a list of equipment as well as a
corresponding diagram(s) to be updated as required.
(b) Customer's Equipment shall remain the property of Customer, and
maintenance, repair, or replacement of Customer's Equipment shall be
the sole responsibility of Customer. In the event that Customer's needs
change with regard to rack space, the parties shall re-evaluate charges
associated with such additional rack space. Upon
- --------------------------------------------------------------------------------
Standard Form Page 13 of 26
- --------------------------------------------------------------------------------
<PAGE>
expiration or termination of this Agreement, Customer agrees to
promptly remove Customer's Equipment. Customer's failure to do so, or
failure to provide Williams with instructions regarding the disposition
of Customer's Equipment within thirty (30) days of the expiration or
termination of the Agreement shall be deemed to be an abandonment of
Customer's Equipment, and Williams may remove Customer's Equipment and
place it in storage for Customer. Upon payment to Williams of the total
cost of removal, storage and shipping, Williams will ship Customer's
Equipment to Customer.
(c) The Teleport is staffed on a 24 x 7 basis. For security of the Teleport
and in the best interests of Williams and its customers, access to the
Teleport is restricted. Customer shall have access to Customer's
Equipment for normal maintenance purposes from 08:00 to 17:00 local
time, weekends and holidays excluded, and Customer shall give the
Teleport a minimum of 24 hours advance notice. Customer shall have
access to Customer's Equipment for emergency servicing purposes at any
time, and Customer shall give a minimum of one hour advance notice.
Customer shall provide the Teleport with a written list of all of
Customer's employees (or contractors) who are authorized to have access
to Customer's Equipment, and Customer shall update this list as needed.
The Teleport may deny access to any person whose name is not on
Customer's list of authorized persons.
(d) The Teleport will supply adequate rack space for Customer's Equipment
as listed above at no charge in addition to the Service Charge. Any
additional rack space required or requested by Customer shall be
subject to availability and to additional charge.
6.5 Uplinking/Downlinking Equipment. Customer shall be solely responsible for
transmitting/receiving satellite signals, including all uplink/downlink
equipment necessary for transmission/reception of satellite signals at
locations other than the Teleport.
6.6 Data Rates and Service Charges.
(a) Monthly Recurring Charges. The Monthly Recurring Charge ("MRC") for the
Service shall be as described in the Ramp-Up and Pricing Schedule
attached hereto as Exhibit D. Customer is committing to the following
data rate ramp-up schedule for Services:
Data Rate Timeframe
_______________________________
[*] Qtr 1, '00
[*] Qtr 2, '00
[*] Qtr 3, '00
[*] Qtr 4, '00
[*] Qtr 1, '01
[*] Qtr 2, '01
[*] Qtr 3, '01
[*] Qtr 4, '01
[*] Qtr 1, '02
[*] Qtr 2, '02
[*] Qtr 3, '02
[*] Qtr 4, '02
(b) Non-Recurring Expense. The Non-Recurring Expense ("NRE") for the
Services shall be as described in the Ramp-Up and Pricing Schedule
attached hereto as Exhibit D. Customer shall be charged the NRE, or
one-time fee of $[*], which sum represents $[*] installation fee for
the two teleports ($[*] x 2 teleports) plus $[*] rack fees for two
racks per each teleport ($[*] x 2 racks x 2 teleports).
(c) Rack Space Charges. The Rack Space Charges for the Service shall be as
described in the Ramp-Up and Pricing Schedule attached hereto as
Exhibit D. Customer will not be charged any MRC for the initial two
racks deployed at each teleport, or 4 total racks. However, as Customer
adds racks, Customer will not incur any NRE, but Customer will incur
MRC charges for every additional rack beyond the first four. The rates
for these racks will vary with the number of transponders required to
provide the service, or as the number of transponders required
increases, the per rack rate will decrease. The Rack rates will be $[*]
per rack, above the initial four, while the Customer requires
[*] Certain information on this page has been omitted and filed
separately with the Commission. Confidential treatment has been
requested with respect to the omitted portions.
- --------------------------------------------------------------------------------
Standard Form Page 14 of 26
- --------------------------------------------------------------------------------
<PAGE>
one transponder. Once the Customer adds a second transponder, the
per rack rate will drop to $[*] per rack. If Customer adds a third
transponder, the rate would drop to $[*] per rack.
(d) Bursting. The Bursting Charge for the Service shall be as
described in the Ramp-Up and Pricing Schedule attached hereto as
Exhibit D. Each single Bursting event is limited to a duration of
seven (7) days, with a limitation of nine (9) days for multiple
bursting events during any thirty-one (31) calendar day rolling
period. If the bursting event exceeds either the seven (7) day
limitation for a single event or any period of time during the
nine (9) days for any thirty-one (31) calendar day period,
Customer will be required to ramp-up its Service to the data rate
level for the highest bandwidth actually used during the bursting
event. For example, if Customer is at 10 MBps, and wants to burst
to 15 MBps for nine (9) days, then Customer is required to ramp-up
its fixed data rate to 15 MBps from 10 MBps and begin paying the
15 MBps rate with no One-Time bursting fee associated with this
ramp-up. Additionally, any Bursting is limited to 10 MBps above
the current fixed data rate. If the Bursting requires bandwidth
greater than 10 MBps higher than the current data rate, Customer
will be required to raise its current data rate to a level
supporting the desired bursted bandwidth. All Bursting is limited
to the bandwidth available within a single transponder. No
bursting capability is available if bandwidth requires an
additional transponder.
(e) The Service Charge shall be invoiced thirty (30) days in arrears
and shall be paid by Customer in U.S. Dollars within thirty (30)
days of the date of invoice. Additionally, at the time of signing
this Agreement, Customer shall remit to Williams the sum of
$[*] which sum represents advance payment of one month's
Service Charge for Transponder 1, to be held by Williams as a
deposit (the "Deposit") throughout the Term of this Agreement.
Further, prior to initiation of Service on Transponder 2, Customer
shall remit to Williams the additional sum of $[*] which sum
represents advance payment of one month's Service Charge for
Transponder 2, to be held by Williams as a deposit throughout the
Term of this Agreement. Such deposits, as are set forth above,
shall be returned to Customer thirty (30) days from termination of
this Agreement, provided however that Customer has made payment
for all services rendered hereunder.
(f) Customer agrees that this is a take-or-pay commitment and that
failure to use the Services throughout the Term does not affect
Customer's obligation to pay the Service Charge throughout the
Term. The parties agree that Customer's total commitment pursuant
to this Agreement through the Term is approximately $[*]. The
parties agree that this take-or-pay commitment is a portion of the
consideration for this Agreement, and that it is not a penalty.
6.7 Labor. If Williams performs labor for Customer beyond Basic Maintenance
as described in Section 5.6 herein, at Customer's request, other than in
connection with the Services, then Customer agrees to pay Williams for
that labor at the rate of $100 per hour. An example of when a labor
charge would be charged is if Williams agreed to switch out an item of
Customer's Equipment with a replacement part provided by Customer.
6.8 Compliance with Teleport Policies. Customer agrees that it shall comply
with all policies and procedures of the Teleport.
7. AUTOMATIC RENEWAL. After the expiration of the Original Term, this Exhibit
-----------------
A-1 shall automatically renew for one-year renewal terms (a "Renewal Term").
Either party may elect not to renew the Agreement by providing the other party
with written notice a minimum of one hundred twenty (120) days prior to the end
of the Original Term or any Renewal Term.
8. ANNUAL SERVICE CHARGE ADJUSTMENT. Upon expiration of the Original Term, and
--------------------------------
continuing thereafter annually on each anniversary of the Renewal Term of
this Agreement, unless otherwise agreed to by the parties, the Service Charge
shall be increased by an amount equal to the Consumer Price Index for All
Urban Consumers (CPI-U), as originally published by the Bureau of Labor
Statistics, for all items less food and energy, unadjusted for the twelve
month period ending the previous December 31.
[*] Certain information on this page has been omitted and filed separately
with the Commission. Confidential treatment has been requested with
respect to the omitted portions.
- --------------------------------------------------------------------------------
Standard Form Page 15 of 26
- --------------------------------------------------------------------------------
<PAGE>
Exhibit A-1(a) Primary Service - New York Link Budget
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
Service Name iBEAM
Coverage CONUS
Uplink earth station Newark
Downlink earth station CONUS EIRP
Satellite name Telstar 7
<S> <C> <C> <C>
---------------------------------------------------------------------------------------------------------------------
Link Input Parameters Uplink Downlink Units
---------------------------------------------------------------------------------------------------------------------
Site latitude 40.73N 48.93N degrees
Site longitude 74.17W 119.43W degrees
Magnetic variation 13.3W 19.0E degrees
Site altitude 0.1 0.2 km
Frequency 14 12 GHz
Polarization Vertical Horizontal
Rain-climatic zone (* prefix Crane) K D
Availability (average year) 99.7 99.7 %
Water vapour density 15 10 gm/m3
Surface temperature 20 15 /degrees/C
Antenna aperture 7 1 metres
Antenna efficiency / gain 65 65 % (* prefix dBi)
Coupling loss 4 0.1 dB
Antenna tracking / mispoint error 0.1 0.1 dB
LNB noise figure / temp 0.8 dB (* prefix K)
Antenna noise 50 K
Adjacent carrier interference 28 28 dB
Adjacent satellite interference 28 28 dB
Cross polarization interference 28 28 dB
Uplink station HPA output back-off 1 dB
Number of carriers / HPA 1
HPA C/IM (up) 30 dB
Uplink power control 6 dB
Uplink filter truncation loss 0 dB
---------------------------------------------------------------------------------------------------------------------
Satellite Input Parameters Value Units
---------------------------------------------------------------------------------------------------------------------
Satellite longitude 129W degrees
Transponder type TWTA
Receive G/T 1.4 dB/K
Saturation flux density -96 dBW/m2
Satellite attenuator pad 6 dB
Transmit EIRP at saturation 47 dBW
Transponder bandwidth 36 MHz
Input back off total 1 dB
Output back off total 2.49 dB
Intermodulation interference 12.5 dB
---------------------------------------------------------------------------------------------------------------------
Carrier/Link Input Parameters Value Units
---------------------------------------------------------------------------------------------------------------------
Modulation 4-PSK
Required bit error rate performance 10-7
Required Eb/No without FEC coding 11.31 dB
Required Eb/No with FEC coding 5.5 dB
</TABLE>
- --------------------------------------------------------------------------------
Standard Form Page 16 of 26
- --------------------------------------------------------------------------------
<PAGE>
<TABLE>
<S> <C> <C> <C>
Information rate 39 Mbps
Overhead 5 %
FEC code rate 0.75
Spread factor 1.2
Carrier spacing factor 1.3
Bandwidth allocation step size 0.1 MHz
System margin 1 dB
---------------------------------------------------------------------------------------------------------------------
Calculations at Saturation Value Units
---------------------------------------------------------------------------------------------------------------------
Gain 1m2 44.38 dB/m2
Uplink C/No 95.52 dB.Hz
Downlink C/No 88.78 dB.Hz
Total C/No 87.94 dB.Hz
Uplink EIRP for saturation 74.11 dBW
---------------------------------------------------------------------------------------------------------------------
General Calculations Uplink Downlink Units
---------------------------------------------------------------------------------------------------------------------
Elevation 17.59 33.1 degrees
True azimuth 245.31 192.61 degrees
Compass bearing 258.61 173.61 degrees
Path distance to satellite 39794.08 38339.27 km
Propagation time delay 0.13 0.13 seconds
Antenna efficiency 65 65 %
Antenna gain 58.36 40.12 dBi
Availability (average year) 99.7 99.7 %
Link downtime (average year) 26.298 26.298 hours
Availability (worst month) 99 99 %
Link downtime (worst month) 7.305 7.305 hours
Spectral power density -24.38 5.38 dBW/4kHz
---------------------------------------------------------------------------------------------------------------------
Uplink Calculation Clear Rain Up Rain Dn Units
---------------------------------------------------------------------------------------------------------------------
Uplink transmit EIRP 73.11 73.11 73.11 dBW
Transponder input back-off (total) 1 1 1 dB
Input back-off per carrier -1 -1 -1 dB
Mispoint loss 0.1 0.1 0.1 dB
Free space loss 207.37 207.37 207.37 dB
Atmospheric absorption 0.43 0.43 0.43 dB
Tropospheric scintillation fading 0.69 0.69 0.69 dB
Atmospheric losses total 1.13 1.13 1.13 dB
Total path loss (excluding rain) 208.59 208.59 208.59 dB
Rain attenuation 0 3.6 0 dB
Uplink Power Control 0 6 0 dB
Uncompensated Rain Fade 0 0 0 dB
C/No (thermal) 94.52 94.52 94.52 dB.Hz
C/N (thermal) 19.37 19.37 19.37 dB
C/ACI 28 28 28 dB
C/ASI 28 28 28 dB
C/XPI 28 28 28 dB
C/IM 30 30 30 dB
Eb/(No*Io) 16.64 16.64 16.64 dB
</TABLE>
- --------------------------------------------------------------------------------
Standard Form Page 17 of 26
- --------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------
Downlink Calculation Clear Rain Up Rain Dn Units
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Satellite EIRP total 47 47 47 dBW
Transponder output back-off (total) 2.49 2.49 2.49 dB
Output back-off per carrier -2.49 -2.49 -2.49 dB
Satellite EIRP per carrier 44.51 44.51 44.51 dBW
Mispoint loss 0.1 0.1 0.1 dB
Free space loss 205.7 205.7 205.7 dB
Atmospheric absorption 0.14 0.14 0.14 dB
Tropospheric scintillation fading 0.32 0.32 0.32 dB
Atmospheric losses total 0.46 0.46 0.46 dB
Total path loss (excluding rain) 206.27 206.27 206.27 dB
Rain attenuation 0 0 0.64 dB
Noise increase due to precipitation 0 0 1.15 dB
Downlink degradation (DND) 0 0 1.79 dB
Total system noise 114.12 114.12 148.8 K
Figure of merit (G/T) 19.45 19.45 18.29 dB/K
C/No (thermal) 86.29 86.29 84.5 dB.Hz
C/N (thermal) 11.13 11.13 9.35 dB
C/ACI 28 28 28 dB
C/ASI 28 28 28 dB
C/XPI 28 28 28 dB
C/IM 12.5 12.5 12.5 dB
Eb/(No*Io) 7.63 7.63 6.54 dB
------------------------------------------------------------------------------------------------------------------
Totals per Carrier (End-to-End) Clear Rain Up Rain Dn Units
------------------------------------------------------------------------------------------------------------------
C/No (thermal) 85.68 85.68 84.09 dB.Hz
C/N (thermal) 10.53 10.53 8.93 dB
C/ACI 24.99 24.99 24.99 dB
C/ASI 24.99 24.99 24.99 dB
C/XPI 24.99 24.99 24.99 dB
C/IM 12.42 12.42 12.42 dB
C/(No*Io) 83.24 83.24 82.26 dB.Hz
C/(N*I) 8.09 8.09 7.11 dB
Eb/(No*Io) 7.12 7.12 6.14 dB
System margin 1 1 1 dB
Net Eb/(No*Io) 6.12 6.12 5.14 dB
Required Eb/(No*Io) 5.5 5.5 5.5 dB
Excess margin 0.62 0.62 -0.36 dB
------------------------------------------------------------------------------------------------------------------
Earth Station Power Requirements Value Units
------------------------------------------------------------------------------------------------------------------
EIRP per carrier 73.11 dBW
HPA power per carrier 14.75 dBW
Uplink power control 6 dB
HPA output back off 1 dB
Waveguide loss 4 dB
Filter truncation loss 0 dB
Number of HPA carriers 1
Total HPA power required 25.75 dBW
Required HPA power capability 376.24 W
Spectral power density -24.38 dBW/4kHz
------------------------------------------------------------------------------------------------------------------
</TABLE>
Standard Form Page 18 of 26
<PAGE>
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
Space Segment Utilization Value Units
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Information rate (inc overhead) 40.95 Mbps
Transmit rate 54.6 Mbps
Symbol rate 27.3 MBaud
Occupied bandwidth 32.76 MHz
Noise bandwidth 75.15 dB.Hz
Minimum allocated bandwidth required 35.49 MHz
Allocated transponder bandwidth 35.5 MHz
Allocated transponder bandwidth 98.61 %
Carriers per transponder by bandwidth usage 1.01
Used transponder power 44.51 dBW
Used transponder power 100 %
---------------------------------------------------------------------------------------------------------------------
</TABLE>
Standard Form Page 19 of 26
<PAGE>
Exhibit A-1(b) Redundant Service - Los Angeles Link Budget
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
Service Name iBEAM
Coverage CONUS
Uplink earth station Steele Valley
Downlink earth station CONUS EIRP
Satellite name Telstar 7
------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Link Input Parameters Uplink Downlink Units
------------------------------------------------------------------------------------------------------------------
Site latitude 33.95N 48.93N degrees
Site longitude 117.40W 119.43W degrees
Magnetic variation 13.7E 19.0E degrees
Site altitude 0.2 0.2 km
Frequency 14 12 GHz
Polarization Vertical Horizontal
Rain-climatic zone (* prefix Crane) D D
Availability (average year) 99.7 99.7 %
Water vapour density 10 5 gm/m3
Surface temperature 20 15 (degrees)C
Antenna aperture 3.5 1 metres
Antenna efficiency / gain 65 65 % (* prefix dBi)
Coupling loss 3 0.1 dB
Antenna tracking / mispoint error 0.1 0.1 dB
LNB noise figure / temp *35 dB (* prefix K)
Antenna noise 50 K
Adjacent carrier interference 28 28 dB
Adjacent satellite interference 28 28 dB
Cross polarization interference 28 28 dB
Uplink station HPA output back-off 1 dB
Number of carriers / HPA 1
HPA C/IM (up) 30 dB
Uplink power control 6 dB
Uplink filter truncation loss 0 dB
---------------------------------------------------------------------------------------------------------------
Satellite Input Parameters Value Units
---------------------------------------------------------------------------------------------------------------
Satellite longitude 129W degrees
Transponder type TWTA
Receive G/T 1.4 dB/K
Saturation flux density -96 dBW/m2
Satellite attenuator pad 6 dB
Transmit EIRP at saturation 47 dBW
Transponder bandwidth 36 MHz
Input back off total 1 dB
Output back off total 2.49 dB
Intermodulation interference 12.5 dB
---------------------------------------------------------------------------------------------------------------
Carrier/Link Input Parameters Value Units
---------------------------------------------------------------------------------------------------------------
Modulation 4-PSK
Required bit error rate performance 10^-7
---------------------------------------------------------------------------------------------------------------
</TABLE>
Standard Form Page 20 of 26
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Required Eb/No without FEC coding 11.31 dB
Required Eb/No with FEC coding 5.5 dB
Information rate 30 Mbps
Overhead 5 %
FEC code rate 0.75
Spread factor 1.2
Carrier spacing factor 1.3
Bandwidth allocation step size 0.1 MHz
System margin 1 dB
------------------------------------------------------------------------------------------------------------------------
Calculations at Saturation Value Units
------------------------------------------------------------------------------------------------------------------------
Gain 1m2 44.38 dB/m2
Uplink C/No 95.52 dB.Hz
Downlink C/No 89.92 dB.Hz
Total C/No 88.86 dB.Hz
Uplink EIRP for saturation 72.72 dBW
------------------------------------------------------------------------------------------------------------------------
General Calculations Uplink Downlink Units
------------------------------------------------------------------------------------------------------------------------
Elevation 48.61 33.1 degrees
True azimuth 200.18 192.61 degrees
Compass bearing 186.48 173.61 degrees
Path distance to satellite 37165.77 38339.27 km
Propagation time delay 0.12 0.13 seconds
Antenna efficiency 65 65 %
Antenna gain 52.34 40.12 dBi
Availability (average year) 99.7 99.7 %
Link downtime (average year) 26.298 26.298 hours
Availability (worst month) 99 99 %
Link downtime (worst month) 7.305 7.305 hours
Spectral power density -19.99 5.14 dBW/4kHz
------------------------------------------------------------------------------------------------------------------------
Uplink Calculation Clear Rain Up Rain Dn Units
------------------------------------------------------------------------------------------------------------------------
Uplink transmit EIRP 70.34 70.34 70.34 dBW
Transponder input back-off (total) 1 1 1 dB
Input back-off per carrier -2.38 -2.38 -2.38 dB
Mispoint loss 0.1 0.1 0.1 dB
Free space loss 206.77 206.77 206.77 dB
Atmospheric absorption 0.13 0.13 0.13 dB
Tropospheric scintillation fading 0.19 0.19 0.19 dB
Atmospheric losses total 0.32 0.32 0.32 dB
Total path loss (excluding rain) 207.2 207.2 207.2 dB
Rain attenuation 0 0.85 0 dB
Uplink Power Control 0 6 0 dB
Uncompensated Rain Fade 0 0 0 dB
C/No (thermal) 93.15 93.15 93.15 dB.Hz
C/N (thermal) 19.13 19.13 19.13 dB
C/ACI 28 28 28 dB
C/ASI 28 28 28 dB
C/XPI 28 28 28 dB
------------------------------------------------------------------------------------------------------------------------
</TABLE>
Standard Form Page 21 of 26
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
C/IM 30 30 30 dB
Eb/(No*Io) 16.49 16.49 16.49 dB
------------------------------------------------------------------------------------------------------------------------
Downlink Calculation Clear Rain Up Rain Dn Units
------------------------------------------------------------------------------------------------------------------------
Satellite EIRP total 47 47 47 dBW
Transponder output back-off (total) 2.49 2.49 2.49 dB
Output back-off per carrier -3.87 -3.87 -3.87 dB
Satellite EIRP per carrier 43.13 43.13 43.13 dBW
Mispoint loss 0.1 0.1 0.1 dB
Free space loss 205.7 205.7 205.7 dB
Atmospheric absorption 0.11 0.11 0.11 dB
Tropospheric scintillation fading 0.22 0.22 0.22 dB
Atmospheric losses total 0.33 0.33 0.33 dB
Total path loss (excluding rain) 206.13 206.13 206.13 dB
Rain attenuation 0 0 0.64 dB
Noise increase due to precipitation 0 0 1.41 dB
Downlink degradation (DND) 0 0 2.05 dB
Total system noise 90.46 90.46 125.14 K
Figure of merit (G/T) 20.45 20.45 19.05 dB/K
C/No (thermal) 86.05 86.05 84.01 dB.Hz
C/N (thermal) 12.04 12.04 9.99 dB
C/ACI 28 28 28 dB
C/ASI 28 28 28 dB
C/XPI 28 28 28 dB
C/IM 12.5 12.5 12.5 dB
Eb/(No*Io) 8.11 8.11 6.96 dB
------------------------------------------------------------------------------------------------------------------------
Totals per Carrier (End-to-End) Clear Rain Up Rain Dn Units
------------------------------------------------------------------------------------------------------------------------
C/No (thermal) 85.28 85.28 83.51 dB.Hz
C/N (thermal) 11.27 11.27 9.49 dB
C/ACI 24.99 24.99 24.99 dB
C/ASI 24.99 24.99 24.99 dB
C/XPI 24.99 24.99 24.99 dB
C/IM 12.42 12.42 12.42 dB
C/(No*Io) 82.51 82.51 81.48 dB.Hz
C/(N*I) 8.49 8.49 7.47 dB
Eb/(No*Io) 7.52 7.52 6.5 dB
System margin 1 1 1 dB
Net Eb/(No*Io) 6.52 6.52 5.5 dB
Required Eb/(No*Io) 5.5 5.5 5.5 dB
Excess margin 1.02 1.02 0 dB
------------------------------------------------------------------------------------------------------------------------
Earth Station Power Requirements Value Units
------------------------------------------------------------------------------------------------------------------------
EIRP per carrier 70.34 dBW
HPA power per carrier 18 dBW
Uplink power control 6 dB
HPA output back off 1 dB
Waveguide loss 3 dB
------------------------------------------------------------------------------------------------------------------------
</TABLE>
Standard Form Page 22 of 26
<PAGE>
<TABLE>
<S> <C> <C>
Filter truncation loss 0 dB
Number of HPA carriers 1
Total HPA power required 28 dBW
Required HPA power capability 631.6 W
Spectral power density -19.99 dBW/4kHz
------------------------------------------------------------------------------------------------------------------------
Space Segment Utilization Value Units
------------------------------------------------------------------------------------------------------------------------
Information rate (inc overhead) 31.5 Mbps
Transmit rate 42 Mbps
Symbol rate 21 MBaud
Occupied bandwidth 25.2 MHz
Noise bandwidth 74.01 dB.Hz
Minimum allocated bandwidth required 27.3 MHz
Allocated transponder bandwidth 27.3 MHz
Allocated transponder bandwidth 75.83 %
Carriers per transponder by bandwidth usage 1.32
Used transponder power 43.13 dBW
Used transponder power 72.85 %
Carriers per transponder by power usage 1.37
Carriers per transponder limited by:- Transponder bandwidth [1.32 carriers]
------------------------------------------------------------------------------------------------------------------------
</TABLE>
Standard Form Page 23 of 26
<PAGE>
EXHIBIT B
CUSTOMER'S CONTACTS FOR OPERATIONAL NOTICES
Customer Contact No. 1
Name: iBEAM Network Operations
Telephone: 877-523-1700 or 408-523-1700
Customer Contact No. 2
Name: Pet Kumler
Title: Director, Network Operations
Telephone: 408-523-1710
Customer Contact No. 3
Name: Joseph Thurman
Title: Executive Director Operations
Telephone: 408-523-1683
Standard Form Page 24 of 26
<PAGE>
Exhibit C
Satellite Terms & Conditions
1. Application of Terms and Conditions; Exclusion of Other or Additional Terms
---------------------------------------------------------------------------
These Standard Terms and Conditions are applicable to all Communications
Services provided by Williams to the Customer ("Customer") pursuant to this
Service Agreement ("Agreement"). COMMUNICATIONS SERVICES WILL BE PROVIDED ON
THE FOLLOWING TERMS AND CONDITIONS AND THE TERMS AND CONDITIONS OF THE
AGREEMENT AND IN THE EVENT OF ANY CONFLICTS BETWEEN THE TERMS AND CONDITIONS
OF THIS EXHIBIT C AND THE TERMS AND CONDITIONS OF THE AGREEMENT, THE TERMS
AND CONDITIONS OF THIS EXHIBIT C SHALL CONTROL.
2. Definitions For purposes of this Agreement, the following terms shall have
-----------
the definitions set forth in this Section 2, as follows:
"Applicable Carrier" shall mean the person, corporation, partnership, firm
------------------
or other entity in control of the satellite, satellite transponder,
microwave link, uplink, downlink, analog copper and/or fiber optic
facilities being used to provide the Communications Services.
"Applicable Carrier's Tariff" shall mean the Applicable Carrier's Tariff for
---------------------------
Allowances for Interruptions, setting forth the policies of the Applicable
Carrier with regard to credits, allowances, refunds or payments in the event
of an interruption of Communications Services caused by the Applicable
Carrier or the Applicable Carrier's equipment, as well as the policies of
the Applicable Carrier with regard to payments, penalties and charges for
cancellation of Communications Services by the Customer.
"Communications Services" shall include (without limitation) satellite
-----------------------
transponder, transponder uplink/downlink, fiber optic, telephone line and/or
microwave capacity, as applicable to the services requested by Customer.
"Customer Agent" shall mean any person, corporation, partnership, firm or
--------------
other entity transmitting signals to, from or via a satellite transponder or
using other Communications Services with the permission of or on behalf of a
Customer.
"Exchange Rates" shall mean the rates at which US dollars are exchanged for
--------------
the relevant foreign currency as published in The Wall Street Journal, U.S.
Edition.
"Uplink/Downlink Agent" shall mean the person, corporation, partnership,
---------------------
firm or other entity engaged by Customer to transmit or receive Customer's
signal to the satellite transponder being used to provide the Communications
Services.
3. Provision of Communications Services Williams shall provide Customer, and
------------------------------------
Customer shall accept from Williams as specified by Customer on the terms
and conditions set forth herein.
4. International Service Rates for international Communications Services are
---------------------
priced to Customer based on the Exchange Rate at the time service is
contracted for, subject to monthly adjustments to reflect changes in the
applicable published Exchange Rate on the first day of each month. Should
the carrier of non-U.S. Communications Services modify its tariff or the
technical parameters for Communications Services during the term of this
Agreement, Williams shall have the right correspondingly to modify the
tariff or rate or technical parameters of its Communications Services to
Customer.
5. Obligations of the Customer Customer shall make all arrangements with other
---------------------------
common carriers, stations, networks, sponsors, music licensing
organizations, performers, representatives or other parties for the
authorizations necessary to avail itself of the Communications Services.
Williams shall be indemnified, defended and saved harmless by Customer from
any liability arising out of failure to make such arrangements. Customer
shall not use Communications Services for an unlawful purpose, including
(without limitation) any use which constitutes a violation of any state or
federal obscenity laws. Williams shall have the right to terminate
Communications Services provided hereunder without liability to Customer in
the event that Williams, its officers, employees or agents, or the
Applicable Carrier, its officers, employees or agents, becomes the subject
of any investigation, or is threatened with or made a party to any
administrative proceeding or litigation, related to the alleged illegal use
of the Communications Services by the Customer.
6. Non-Interference for Satellite Transmissions and Use of Other Communications
----------------------------------------------------------------------------
Services
--------
(a) All transmissions to and from the satellite transponder or other use of
Communications Services made by Customer and/or a Customer Agent in
connection with use of Communications Services pursuant to this
Agreement shall comply with all of the rules and regulations of the
Federal Communications Commission ("FCC"), other governmental agencies,
carriers or other authorities applicable to Customer and/or each
Customer Agent with respect to the Satellite Transponder or the
Communications Services. Customer and each Customer Agent will follow
the established practices and procedures of the Applicable Carrier for
frequency coordination and will not utilize the Communications Services
in a manner which, under standard engineering practice, would or might
interfere with the use of or cause physical harm to any satellite
transponder, the satellite or any other communications facility. If, in
Williams, the Applicable Carrier's or other carrier's judgment,
Customer's or any Customer Agent's transmissions to or from or
utilization of the satellite transponder or other Communications
Services (whether directly or through a Customer Agent), interferes with
or causes physical harm to any satellite transponder, the satellite or
any other communications facility, Customer agrees to cease or cause to
be ceased immediately all transmissions to and utilization of the
satellite transponder or other Communications Services upon notice
thereof by Williams or the carrier until such time as such transmission
or utilization shall not, in Williams' or the carrier's
Standard Form Page 25 of 26
<PAGE>
judgment, interfere with and shall not cause physical harm to any
satellite transponder, the satellite or any other communications
facility. In such event and in addition to Williams' other rights and
remedies hereunder, Customer agrees that its rights to use a portion
of the satellite transponder or other Communications Services in
accordance with this Agreement shall be subject to Williams' right to
terminate Communications Services and all of Customer's rights
hereunder without liability to Customer and to take such action as may
be necessary, appropriate or desirable to terminate any such
interference or physical harm by Customer and each Customer Agent.
(b) To ensure that Customer and each Uplink/Downlink Agent's
transmissions to and from the satellite transponder and
Customer's utilization of the Communications Services
(whether directly or through an Uplink/Downlink Agent) does
not so interfere with or cause physical harm to any
transponder or satellite, Customer and each Uplink/Downlink
Agent, prior to any transmission to the satellite
transponder, must satisfy the uplink access requirements set
forth by the Applicable Carrier. Further, without limiting
the generality of the foregoing, if Customer's use involves
video broadcasting, Customer agrees to comply in all
respects with Section 25.308 of the FCC rules regarding the
Automatic Transmitter Identification System.
7. Pre-emptible Nature of Communications Services The satellite transponder
----------------------------------------------
and other Communications Services provided herein are not normally
protected, other than as provided in Section 8 herein, and may be preempted
and Customer acknowledges and agrees that it sometimes may be necessary or
advisable for the Applicable Carrier or other carrier deliberately to
preempt or interrupt Customer's use of the Communications Services in order
to protect the overall performance of each satellite, fiber optic network
or other communications facility, or other technical reasons. Such
decisions shall be made by the owners or operators of the satellite, fiber
optic network or other communications facility at their sole discretion and
Williams shall have no liability to Customer as a result of such decisions.
9. Fully Protected Transponder. "Fully-Protected" transponders, in the event
---------------------------
of failure, shall be restored by the Applicable Carrier using spare
equipment that may be available on the satellite at the time of failure, or
on a comparable transponder on the same satellite, or on another Applicable
Carrier satellite then in orbit, except when the failure is caused by
Customer. Fully Protected transponders are not preemptible.
9. Allowances for Interruption
---------------------------
(a) Allowances for interruption of Communications Service will be in
accordance with the Applicable Carrier's Tariff. In the absence of an
Applicable Carrier's Tariff, Williams' policy shall apply as follows:
(i) When an interruption of a Communications Service occurs for a
period of 60 seconds or more, credit is allowed on the basis of 5
minutes for each 5 consecutive minutes or fraction thereof of
interruption; (ii) Two or more interruptions occurring during any
period of 5 consecutive minutes shall be considered one interruption;
and (iii) An interruption of either the audio or visual portion of the
television channel shall be considered an interruption of both.
(b) An allowance will not be made where Customer fails to transmit or
receive a television, data or voice channel as a result of, or
attributable in whole or in part to: (i) Customer's negligence or
willful acts, or the negligence or willful acts of its officers,
directors, agents, employees, subsidiaries, parents, affiliates,
customers, authorized users and viewing subscribers, or any of them;
(ii) The failure of local channels, transmission lines or equipment
provided by Customer, its subsidiaries, parents, affiliates,
authorized users, viewing subscribers, Customer Agents or any of them;
(iii) Sun outages, heavy precipitation or heavy cloud cover; or (iv)
Customer's failure to use the channel ordered.
(c) In no event shall Williams be liable for allowances for interruption
unless the claim for such allowance is made within fifteen (15) days
after the date of the interruption.
10. Denial of Service For any violation of the Communications Act of 1934, as
-----------------
amended, or any Rules, Regulations or Orders of the FCC or of the terms of
this Agreement by Customer, or the imposition by the FCC or any
governmental authority having jurisdiction of conditions on the provision
of Communications Services which are unacceptable to Williams or the
Applicable Carrier, Williams may either temporarily deny service or
terminate the service without incurring liability to Customer.
11. Cancellation by Customer Except as specifically provided herein,
-------------------------
Communications Service may only be canceled upon the occurrence of all the
following: written notice to Williams; payment of total hourly, monthly or
annual charges due for service previously provided and for scheduled
service that has not been provided as of the date of cancellation; and
payment of all other sums otherwise due through the term of the Fixed-Term
Service to be provided pursuant to this Agreement.
12. Title to Communications Facilities This Agreement shall not, and shall not
----------------------------------
be deemed to, convey to Customer title of any kind to any of the satellite
transponders, transponder uplinks/downlinks, fiber optic links, telephone
lines, microwave facilities or other facilities utilized in connection with
the Communications Services.
Standard Form Page 26 of 26
<PAGE>
EXHIBIT D Ramp-Up and Pricing Schedule
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
CONUS Solution QTR 1 QTR 2 QTR 3 QTR 4 QTR 1 QTR 2 QTR 3 QTR 4 QTR 1 QTR 2 QTR 3 QTR
`00 `00 `00 `00 `01 `01 `01 '01 `02 `02 `02 '02
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Service Parameters [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
Aggregate Data Rate [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
XP #1 Data Rate [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
XP #1 Power Required in MHz [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
XP #2 Data Rate [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
XP #2 Power Required in MHz [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
- ------------------------------------------------------------------------------------------------------------------------------------
Service Fees NRE Monthly Recurring Charges
- ------------------------------------------------------------------------------------------------------------------------------------
Uplink with Redundancy
Total Uplink [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
Rack Charges [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
Space Segment
XP #1 - TelStar 7 Ku - 36 MHz [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
XP #2 First Right of Refusal [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
XP #2 - TelStar 7 Ku - 36 MHz [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
- ------------------------------------------------------------------------------------------------------------------------------------
[*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]
Approximate Term Value [*]
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Bursting - 24 hour notice is required to burst with a One-Time fee of [*] per event.
- -----------------------------------------------------------------------------------------------------------------
<S> <C>
Transponder Assumptions Additional Charges Not Included Above...
XP Protection = Fully Protected Rack Space
Full Transponder - Full Power & Bandwidth 2 Racks Per Teleport Included in Monthly Uplink Charges
Data rate assumes Proportional Power & Bandwidth $[*] per rack, per month, per location for the 1/st/ XP
Data rate can only ramp-up $[*] per rack, per month, per location for 2/nd/ XP
Term is 3 Years $[*] per rack, per month, per location for the 3/rd/ XP
Pricing does not include local loop charges
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
Note: Information in this document marked with an "[*]" has been omitted and
filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.
