Exhibit 10.3

L E A S E

 

1. PARTIES:

1.1 Names. This lease (the “Lease”) is made and entered into on the date below
written in San Francisco, California, by and between EDWARD J. CONNER, Landlord,
and CONSTANT CONTACT, INC., a Delaware corporation, Tenant.

 

2. PREMISES:

2.1 Description. Landlord hereby leases to Tenant and Tenant hereby rents from
Landlord the real property consisting of approximately 7,898 rentable square
feet of space located on the first floor of 85 Second Street, San Francisco,
California as identified on Exhibit A (the “Premises”). The term “Building” for
purposes of this Lease shall include common areas and the structure at 85 Second
Street, San Francisco, California.

 

3. TERM:

3.1 Period. The term of this Lease shall be for a period of five (5) years,
commencing upon the earlier of Tenant commencing business on the Premises
(provided in no event shall the construction of the initial Tenant Improvements
or moving in of furniture be deemed to be “commencing business”) or November 1,
2012 (such earlier date, the “Commencement Date”).

3.2 Possession. Landlord will deliver possession of the Premises to Tenant on
August 1, 2012, free of (i) all tenants having possessory rights; and
(ii) debris and personal property other than wiring. If Landlord is unable to
deliver possession of the Premises as of August 1, 2012 as a result of causes
beyond its reasonable control, Landlord shall not be liable for any damage
caused for failing to deliver possession, and this Lease shall not be void or
voidable. The Commencement Date shall be delayed one day for each day that
Landlord is late in delivering possession of the Premises to Tenant; provided
that if Landlord has not delivered the Premises by November 1, 2012, then Tenant
may terminate the Lease by delivering written notice thereof to Landlord no
later than November 15, 2012. Tenant’s use of the Premises prior to the
Commencement Date shall be subject to all of the terms and conditions of this
Lease except that Tenant shall have no obligation to pay Base or Additional Rent
and Tenant shall use the Premises solely for the construction of tenant
improvements and the installation of furniture, fixtures and equipment.

 

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4. RENT:

4.1 Amount and Payment. Commencing on the Commencement Date, Tenant shall pay to
Landlord as base rent (the “Base Rent”), in advance, without deduction, setoff,
prior notice or demand, the following sum per month:

 

Month

   Base Rent  

1-12

   $ 29,617.50   

13-24

   $ 30,275.66   

25-36

   $ 30,933.83   

37-48

   $ 31,592.00   

49-60

   $ 32,250.16   

Notwithstanding the foregoing, provided that Tenant is not then in default
beyond any applicable cure period, Tenant shall not be required to pay the Base
Rent owing in the first month of the Lease term. Base Rent for the first month
such rent is owing (i.e., the second month) shall be paid concurrently with the
execution and delivery of this Lease. Thereafter, Base Rent shall be paid on the
first day of each calendar month during the lease term. If the date of
commencement or expiration of the term of this Lease occurs on a day other than
on the first day of a calendar month, Base Rent for the first and last month
shall be prorated upon the number of lease days in that particular month. All
rental shall be paid at Suite 250, 27 Maiden Lane, San Francisco or in such
other place or to such other person as Landlord may from time to time designate
in writing. All payments of any type due from Tenant to Landlord hereunder shall
be characterized as rental due under this Lease.

4.2 Security Deposit. Receipt of $30,933.83 is hereby acknowledged as a security
deposit for the performance by Tenant of the provisions of this Lease. If Tenant
is in default beyond any applicable cure period, Landlord may use the security
deposit, or any portion of it, to cure the default or compensate itself for all
damage resulting from Tenant’s default. Tenant hereby waives Civil Code
Section 1950.7. Tenant shall pay upon demand to Landlord a sum equal to the
portion of the security deposit expended or applied by Landlord so as to
maintain the security deposit in the sum initially deposited with the
Landlord. If Tenant is not in default at the expiration or sooner termination of
this Lease, Landlord shall return the security deposit without interest to
Tenant after calculation and deduction of all sums due under this Lease within
sixty (60) days after such expiration or termination. Landlord’s obligations
with respect to the security deposit are those of a debtor and not a trustee and
Landlord may commingle the security deposit with Landlord’s other funds.

 

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4.3 Late Charge; Interest. If Tenant fails to pay any rental due hereunder
within 5 business days after notice that the same is due with respect to the
first late payment in any calendar year or within 5 days of the date when it is
due with respect to any other late payment, Tenant shall pay Landlord a late
charge in an amount equal to seven percent (7%) of the amount not paid when due
and interest on the past-due amount, from the date due until paid, at the rate
of ten per cent (10%) per annum. Tenant shall pay the late charge and interest
as Additional Rent with the next installment of Base Rent.

 

5. RENTAL ADJUSTMENT:

5.1 General. In addition to the Base Rent provided for in paragraph 4, Tenant
shall pay to Landlord as additional rental the sums set forth in this paragraph
5 (the “Additional Rent”).

5.2 Adjustment for Operating Expenses.

(a) Adjustment. Tenant shall pay to Landlord as Additional Rent an amount equal
to Tenant’s proportionate share of Operating Expenses for each calendar year
(the “Comparison Year”) that are in excess of the Operating Expenses in the
calendar year 2013 (the “Base Year”). If in the Base Year or any Comparison Year
the average of the rentable square feet of the Building actually occupied by
tenants is less than 95% of the total rentable square feet of the Building,
Operating Expenses shall be adjusted to equal Landlord’s reasonable estimate of
Operating Expenses had there been average occupancy of 95% of the total rentable
square feet of the Building for the year. If in the Base Year or any Comparison
Year Landlord is not furnishing a particular service or work (the cost of which,
if furnished by Landlord, would be included in Operating Expenses) to a tenant
(other than Tenant) that has undertaken to perform such service or work in lieu
of receiving it from Landlord, Operating Expenses for that year shall be
considered to be increased by an amount equal to the additional Operating
Expenses that Landlord would reasonably have incurred during this period if
Landlord had furnished such service or work to that tenant. Landlord’s
reasonable estimate of such expenses shall be final and binding on Tenant.

(b) Operating Expenses. The term “Operating Expenses” as used herein shall
include all actual direct costs of operation, maintenance and management of the
Building, including common areas serving the Building, as determined by
generally accepted accounting practices. By way of illustration but not

 

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limitation, Operating Expenses shall include the cost or charges for the
following items: heat; air conditioning; light; water and sewer charges; power;
waste disposal; janitorial services; window cleaning; materials and supplies;
equipment and tools; security; maintaining elevators; service agreements on
equipment and their maintenance and repairs; insurance premiums for the
insurance carried by Landlord, in amounts reasonably determined by Landlord;
licenses, permits and inspection fees; wages and salaries; employee benefits and
payroll taxes; accounting, auditing and legal expenses; management fees not to
exceed customary fees for such services for comparable buildings in San
Francisco, California; maintenance of the Building and grounds; depreciation on
personal property; the cost of contesting the validity or applicability of
any governmental enactments which may affect operating expenses; cost of
compliance with laws and governmental regulations; the cost of any capital
improvements made to or capital assets acquired for the Building by Landlord
that reduce any other operating expenses, are reasonably necessary for the
health and safety of the occupants of the Building, or are made to the Building
by Landlord after the Commencement Date that are required under any governmental
law or regulation, such costs to be amortized over their useful life as
reasonably determined by Landlord in accordance with generally accepted
accounting principles, together with interest on the unamortized balance at the
reference rate charged by the Bank of America, San Francisco main office, at the
time such costs are incurred plus 2% per annum.

For the purposes of this Lease, Operating Expenses shall not include taxes
covered under subparagraph 5.3 below, interest expenses, costs attributable to
seeking and obtaining new tenants as well as retaining existing tenants, such as
advertising costs, leasing commissions, architectural, engineering, attorneys’
fees, renovations and improvements, depreciation on the Building itself, the
cost of capital expenditures except as provided above, costs attributable to
enforcing leases against tenants, depreciation and amortization of debt, costs
incurred due to violations by the Landlord of terms of leases in the Building,
interest on mortgages and rent under any ground lease, repairs and other work to
the extent that Landlord is reimbursed by insurance, fines or penalties due to
violations by Landlord of government rules, costs for paintings and other
objects of art, wages, salaries or other consideration paid to executive
employees of Landlord above the grade of Building Manager, management fees in
excess of three percent (3%) of the Building’s gross revenues, amounts paid to
Landlord or to subsidiaries or affiliates of Landlord for goods and/or services
in the Building to the extent the same exceeds the costs of such goods and/or
services rendered by unaffiliated third parties on a competitive basis, removal
of Hazardous Material from the

 

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Premises or property, costs arising from the gross negligence or willful
misconduct of Landlord or its agents, employees, vendors, contractors or
providers of materials or services or costs attributable to repairing items to
the extent covered by warranties or insurance.

(c) Calculation. Tenant’s proportionate share shall be based upon a fraction,
the numerator of which shall be the number of rentable square feet in the
Premises and the denominator of which shall be the total number of rentable
square feet of the Building. Landlord represents and warrants that the total
number of rentable square feet in the Building is 114,268, and, accordingly,
Tenant’s proportionate share of the Operating Expenses as of the Commencement
Date shall be 6.91%.

5.3 Adjustment for Taxes. Tenant shall pay to Landlord an amount equal to its
proportionate share (as determined pursuant to Section 5.2(c) above) of any
increase in Direct Taxes paid or incurred by Landlord in any tax year above the
Direct Taxes paid or incurred by Landlord during the Base Year. Landlord shall
pass through the cost of increases in Direct Taxes payable in installments in a
manner such that the payments are attributable to respective years in a
consistent manner. The term “Direct Taxes” as used herein shall include all real
property taxes on the Building, the land on which the Building is situated, and
the various estates in the Building and the land, including, but not limited to,
all taxes payable by Landlord by reason of its ownership of the Building and the
leases (other than net income taxes) whether or not now customary or within the
contemplation of the parties hereto, all real estate taxes or personal property
taxes and other taxes, charges and assessments which are levied solely with
respect to the Building and any improvements, fixtures and equipment and all
other property of Landlord, real or personal, located in the Building used in
connection with the operation of the Building and the land upon which they are
situated, and shall also include any taxes which shall be in lieu of real estate
or personal property taxes. Tenant shall not be required to pay any municipal,
county, state or federal income or franchise taxes of Landlord, or any
succession, inheritance or transfer taxes of Landlord. If at any time after
execution of this Lease and during the term the laws concerning the methods of
real property taxation prevailing at the Commencement Date are changed so that a
tax or excise on rents or any other such tax, however described, is levied or
assessed against Landlord as a direct substitution in whole or in part for any
real property taxes, tenant shall pay before delinquency (but only to the extent
that it can be ascertained that there has been a substitution and that as a
result Tenant has been relieved from the payment of real property taxes it

 

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would otherwise have been obligated to pay) the substitute tax or excise on
rents. “Direct Taxes” shall include the reasonable cost to Landlord of
contesting the amount or validity or applicability of any of the above-mentioned
taxes. Net recoveries through protest, appeals or other actions taken by
Landlord in its discretion, after deduction of all reasonable costs and
expenses, including attorneys and other fees, shall be deducted from Direct
Taxes for the year of receipt. In no event shall taxes include any penalty or
interest for the late payment by Landlord of taxes. Landlord shall provide
Tenant with a receipted copy of the tax bill upon Tenant’s written request.

5.4 Payment. Within a reasonable time after the end of each calendar year,
Landlord shall compute the amount of Additional Rent payable by Tenant, if any,
for the prior year and deliver to Tenant a statement (the “Reconciliation
Statement”) setting forth the calculation of Operating Expenses and Direct Taxes
and Tenant’s proportionate share of increases in the same for the previous
calendar year over the amount of Operating Expenses and Direct Taxes incurred by
Landlord for the Base Year. If the amount previously paid by Tenant for such
calendar year is less than the amount of Tenant’s proportionate share as set
forth in the Reconciliation Statement, Tenant shall pay the amount of any
deficiency at the time the next monthly Base Rent payment is due (or within 30
days if no additional Base Rent payments are due). If the amount previously paid
by Tenant for such calendar year is greater than the amount of Tenant’s
proportionate share as set forth in the Reconciliation Statement, the amount of
any overpayment shall be offset against the next monthly Base Rent payment (or
refunded to Tenant within thirty (30) days if no additional Base Rent payments
are due). In addition, Tenant shall pay monthly with the Base Rent an amount
equal to 1/12 of Landlord’s estimate of Tenant’s proportionate share of the
increases in Operating Expenses and Direct Taxes to be paid by Tenant for the
then current calendar year over the amount of Operating Expenses and Direct
Taxes incurred by Landlord during the Base Year (an “Additional Rent Estimate”)
if Landlord has delivered to Tenant an Additional Rent Estimate for such
calendar year. Tenant shall pay to Landlord the aggregate sum of any
underpayments of Tenant’s proportionate share of Operating Expenses and Direct
Taxes for that portion of such calendar year prior to the delivery of the
Additional Rent Estimate, based on the Additional Rent Estimate, at the time the
next monthly Base Rent payment is due. If Landlord has not delivered to Tenant
an Additional Rent Estimate for such calendar year, Tenant shall continue to pay
the same monthly amount that Tenant paid for Operating Expenses and Direct Taxes
during the preceding calendar year. Landlord’s failure to furnish the
Reconciliation Statement in a timely manner for any calendar year shall not
prejudice Landlord in enforcing its rights under this

 

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Section 5. The provisions of this Section 5 shall survive the expiration or
earlier termination of the term of this Lease for a period of One (1) year.

5.5 Audit Rights. For a period of one hundred twenty (120) days after the
delivery to Tenant of the Reconciliation Statement, Tenant shall have the right
to audit Landlord’s books with respect to Operating Expenses and Direct Taxes
incurred during the base year and the applicable calendar year, upon ten
(10) business days’ prior written notice to Landlord (which notice may be given
at any time within said 120 day period). Such audit shall be made at Landlord’s
offices during normal business hours. During such inspection, Landlord will make
such books and records and any reasonably appropriate supporting documentation
available for Tenant’s review. Tenant shall not disclose audit results to any
other person (Tenants’ employees and agents excluded). In no event shall any
such audit or inspection be performed by a person or entity being compensated on
a contingency fee basis or based upon a share of any refund obtained by Tenant.
In the event that the audit and inspection reveals an error in the calculation
of Operating Expenses or Direct Taxes, Tenant agrees to deliver to Landlord,
within thirty (30) days after conclusion of each such audit and inspection, a
true and complete copy of the results thereof. In the event that the audit and
inspection reveals an error in the calculation of Operating Expenses or Direct
Taxes, and Landlord does not dispute the results of such audit and inspection by
giving Tenant written notice of Landlord’s dispute within ten (10) days after
Landlord’s receipt of the results thereof, then adjustment will be made by
appropriate payment or refund within fifteen (15) days after such audit and
inspection results are delivered to Landlord. If Landlord timely disputes the
results of any audit and inspection, Landlord and Tenant shall mutually
designate a disinterested certified public accountant (the “CPA”) located in San
Francisco, California, to conduct an audit of the Operating Expenses and Direct
Taxes for the applicable calendar year, and the results of such audit shall be
binding upon Landlord and Tenant and any underpayment or overpayment shall be
made within fifteen (15) days after both parties have received a copy of the
results of such audit. The cost of the CPA shall be paid one-half by Landlord
and one-half by Tenant.

 

6. Construction on Premises:

6.1 Condition of Premises. Tenant acknowledges that it has thoroughly inspected
the Premises and except as set forth herein accepts the Premises “as is.” Except
as set forth herein, Landlord makes no warranty whatsoever with respect to the
condition of the Premises or that any utility services provided to the Premises
are in form or amount suitable for Tenant’s use.

 

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6.2 Construction. The construction obligations of the parties with respect to
the initial Tenant Improvements are set forth in the work letter attached as
Exhibit B (the “Work Letter”).

6.3 Cost of Construction. Except as provided in the Work Letter, all cost of
construction shall be borne by Tenant. Construction costs shall include all
direct and indirect costs of construction including, without limitation,
permits, contractors’ fees, materials, architects’ fees, utilities’ fees and
charges, any additional air conditioning capacity, all costs of complying with
Code as it relates to the Premises, and all other costs associated with
improving the Premises from their present state or making any other change or
improvement to the Building or its services required by Tenant’s use or
improvements.

 

7. USES:

The Premises shall be used solely for general office purposes (and uses
incidental and ancillary thereto) and for no other use or purpose without the
prior written consent of Landlord. Tenant shall not do or suffer anything to be
done in or about the Premises, nor shall Tenant bring or allow anything to be
brought into the Premises, which will in any way increase the rate of any fire
insurance or other insurance upon the Building or its contents, cause a
cancellation of said insurance or otherwise affect said insurance in any
manner. Tenant also shall not do or suffer anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights of other
occupants of the Building or injure or unreasonably annoy said occupants, nor
shall Tenant use or suffer the Premises to be used for any immoral, unlawful or
objectionable purposes. In no event shall Tenant cause or suffer to be caused
any nuisance in or about the Premises, and no loudspeakers or similar devices
shall be used without the prior written approval of Landlord. Tenant further
agrees not to commit or suffer to be committed any waste in or upon the
Premises. Tenant shall not bring, store, deposit or use any Hazardous Material
(as defined herein) on the Premises, nor shall Tenant allow or permit its
agents, employees, or contractors to bring, store, deposit or use any Hazardous
Material on the Premises, except incidental quantities of household chemicals
commonly used for office and janitorial purposes. “Hazardous Material” as used
herein shall mean any hazardous, toxic or radioactive substance now or hereafter
regulated by federal, state or local governmental or other authority, including,
but not limited to, any “hazardous substance” as defined in Section 101 of the
Comprehensive Environmental Response, Compensation and Liability Act. The
provisions of this paragraph are for the benefit of Landlord only and shall not

 

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be construed to be for the benefit of any other tenant or occupant of the
Building. Landlord represents that to the best of his knowledge there are no
Hazardous Materials in, on, about, under or emanating from the Premises or the
property that would prohibit Tenant’s use of the Premises for commercial
purposes as described herein. In the event that there are any such Hazardous
Materials, Landlord shall at his expense be responsible for the remediation or
handling thereof as required in accordance with applicable laws. Tenant shall
have access to and the right to use the Premises at all times, twenty-four
(24) hours per day and three hundred sixty-five (365) days per year during the
term of this Lease, subject to Landlord’s rules and regulations, the Building
security procedures and the other provisions of this Lease.

 

8. SERVICES AND UTILITIES:

8.1 Landlord’s Obligation to Furnish. Subject to the provisions elsewhere herein
contained and to the rules and regulations of the Building, Landlord agrees to
furnish the Premises with (i) water and electricity for customary office use;
and (ii) HVAC Monday through Friday 8:00 a.m. through 6:00 p.m. (excepting the
following holidays: New Year’s Day, Martin Luther King Day, President’s Day,
Memorial Day, 4th of July, Labor Day, Thanksgiving, day-after Thanksgiving, and
Christmas) in an amount reasonably required in Landlord’s judgment for the
comfortable occupation of the Premises. The HVAC system for the Premises shall
maintain indoor air temperatures between 68 and 75 degrees under normal weather
conditions; provided, however, that Landlord shall be in breach of the foregoing
only if the temperature in the Premises is not within the stipulated range for
more than five (5) consecutive days and Landlord’s obligation to provide such
HVAC is subject to Section 8.3 below. Landlord shall also provide daily
janitorial service (five nights a week) during the times and in the manner that
such services are, in Landlord’s judgment, customarily furnished in comparable
office buildings in the area; provided that the scope of such services shall be
reasonably consistent with the scope of services attached hereto as Exhibit C.
Tenant shall be responsible for its telephone, internet and other
telecommunication services.

8.2 Payment. In the event any Building services or utilities are used in excess
of the above by reason of longer hours, more days, or use different than other
general office tenants of the Building (with the parties acknowledging that a
dedicated computer room, as opposed to an IT closet used by office tenants
generally, is a different use), Tenant shall pay monthly for such upon
presentation of invoice. The parties acknowledge that the after-hours HVAC
charge as of the date of this Lease is $45 per hour. To the extent Tenant’s
additional use is excessive and

 

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Landlord installs a meter to measure such use, then Tenant shall pay to Landlord
the cost of any meters and their installation and maintenance, any additional
cost incurred by Landlord in accounting for the resources consumed, and for the
amount of the additional resources consumed at the rates charged by the local
public utility or agency furnishing the same. Any sums payable under this
paragraph shall be considered additional rent and may be added to any
installment of rent thereafter becoming due, and Landlord shall have the same
remedies for a default in payment of such sum as for a default in the payment of
rent. For the avoidance of doubt, the parties confirm that Tenant shall not be
required to pay for electricity to the Premises, except to the extent set forth
in Section 5.2 above and this Section 8.2, it being the intention that
electricity to the Premises is included in the definition of Operating Expenses.

8.3 Interruptions. Landlord shall use reasonable efforts to remedy any
interruption in the furnishing of the services and utilities to be provided by
Landlord. However, Landlord shall not be liable for any failure to provide or
any reduction in any of said services or utilities if such failure or reduction
is caused by the making of repairs or improvements to the Premises or to the
Building, the installation of equipment, Acts of God or the elements, labor
disturbances of any character, acts of terrorism or any other accidents or
conditions whatsoever beyond the reasonable control of Landlord, or rationing or
restrictions on the use of said services and utilities due to energy shortages
or other causes, whether or not any of the above result from acts or omissions
of Landlord. Furthermore, Landlord shall be entitled to cooperate voluntarily in
a reasonable manner with the efforts of national, state or local governmental
bodies or utilities suppliers in reducing energy or other resources consumption.

 

9. TAXES PAYABLE BY TENANT:

To the extent not included as Direct Taxes, Tenant shall pay before delinquency
any and all taxes levied or assessed and which become payable by Landlord (or
Tenant) after execution of and during the term of this Lease (excluding,
however, state and federal personal or corporate income taxes measured by the
income of Landlord from all sources, capital stock taxes, and estate and
inheritance taxes), whether or not now customary or within the contemplation of
the parties hereto, which are based upon, measured by or otherwise calculated
with respect to: (a) the gross or net rental income of Landlord under this
Lease, including, without limitation, any gross receipts tax levied by any
taxing authority, or any other gross income tax or excise tax levied by any
taxing authority with respect to the receipt of the rental payable hereunder;
(b) the value of Tenant’s equipment,

 

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furniture, fixtures or other personal property located in the Premises; (c) the
possession, lease, operation, management, maintenance, alteration, repair, use
or occupancy by Tenant of the Premises or any portion thereof; (d) the value of
any leasehold improvements, alterations or additions made in or to the Premises
regardless of whether title to such improvements, alterations or additions shall
be in Tenant or Landlord; or (e) this transaction or any document to which
Tenant is a party creating or transferring an interest or an estate in the
Premises.

 

10. COMPLIANCE WITH LAW:

Tenant shall not do or suffer anything to be done in or about the Premises which
will in any way conflict with any law, statute, ordinance or other governmental
rule, regulation or requirement now in force or which may hereafter be enacted
or promulgated. At its sole cost and expense, Tenant shall promptly comply with
all said governmental measures and also with the requirements of any board of
fire underwriters or other similar body now or hereafter constituted to deal
with the condition, use or occupancy of the Premises, excluding structural
changes not related to or affected by Tenant’s alterations, additions or
improvements. The judgment of any court of competent jurisdiction or the
admission of Tenant in any judicial action, regardless of whether Landlord is a
party thereto, that Tenant has violated any of said governmental measures or
requirements shall be conclusive of that fact as between Landlord and
Tenant. Notwithstanding the foregoing or any other provision of this Lease to
the contrary (other than Additional Rent payable under Section 5), Tenant shall
not be responsible for compliance with any such laws, regulations, or the like
requiring (a) structural repairs or modifications; or (b) repairs or
modifications to the utility or building service equipment (or the installation
of new utility or building service equipment); unless such repairs,
modifications, or installations shall (i) be due to Tenant’s particular manner
of use of the Premises (as opposed to office use generally), including, without
limitation, the installation of a computer room requiring supplemental cooling,
or (ii) be due to the negligence or willful misconduct of Tenant or any agent,
employee, or contractor of Tenant.

 

11. ALTERATIONS:

Other than the construction specified in paragraph 6.2 and non-structural
alterations costing less than $5,000, Tenant shall not make or suffer to be made
any alterations, additions or improvements to the Premises or any part thereof,
including the attachment of any fixtures or equipment, without obtaining
Landlord’s prior written consent, which consent shall not be

 

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unreasonably withheld. When applying for such consent, Tenant shall furnish
complete plans and specifications for such alterations, additions or
improvements. All alterations, additions, fixtures and improvements, whether
temporary or permanent in character, made in or upon the Premises either by
Landlord or Tenant, shall at once become part of the realty and belong to
Landlord and, at the end of the term hereof, shall remain on the Premises
without compensation of any kind to Tenant except as herein provided in this
Lease. Movable furniture and equipment shall remain the property of
Tenant. Notwithstanding any other provision contained in this Lease, Tenant
agrees that it shall, upon Landlord’s written request, at its sole cost and
expense, promptly remove any alterations, additions, fixtures, communication
system or other cabling, or improvements designated by Landlord to be removed
and repair any damage to the Premises resulting from such removal. Such removal
shall be made prior to the expiration or termination of this Lease if Landlord
gives Tenant such written request no less than thirty (30) days prior to the
expiration or termination of this Lease, provided that if Tenant requests that
Landlord make the determination as to whether or not Landlord will require
removal of certain improvements at the time of Tenant’s installation of such
improvements, then Landlord will make such determination at the time requested
by Tenant. All work done by or for Tenant costing in excess of $5,000 per set of
improvements shall be performed by a licensed general contractor who, if the
cost of the work exceeds $10,000, shall provide a full payment and performance
bond naming both Landlord and Tenant as insured. Tenant shall not be required to
remove the initial Tenant Improvements installed pursuant to the Work Letter.

 

12. REPAIR:

By taking possession of the Premises, except as otherwise set forth herein,
Tenant accepts the Premises as being in the condition in which Landlord is
obligated to deliver them. Tenant shall at all times during the term of this
Lease, at its sole cost and expense, keep the Premises in good and sanitary
order, condition and repair, damage thereto by fire, earthquake, Act of God or
the elements excepted, including, without limitation, all built in dishwashers,
refrigerators, microwaves and other appliances. To the extent allowed by law,
Tenant hereby waives all benefits of and rights under California Civil Code
Sections 1932(1), 1941 and 1942 and under any similar law, statute, or ordinance
now or hereafter in effect. Upon the expiration or sooner termination of this
Lease, Tenant shall surrender the Premises to Landlord, together with all
alterations, additions, fixtures, improvements and repairs which have been made
thereto, in the same condition as delivered, ordinary wear and tear and damage
by fire, earthquake, Act of God or the elements

 

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excepted. Except as otherwise set forth herein, Landlord has no obligation to
alter, add to, improve, repair, remodel or paint the Premises. Tenant also
acknowledges that Landlord has made no representations regarding the condition
of the Premises or the Building except as otherwise set forth herein, provided
below and, without limiting the generality of the foregoing, Tenant acknowledges
that Landlord has made and is making no representation or warranty, either
expressed or implied with respect to sound transfer for any reason. Landlord
represents and warrants to the best of its knowledge that (i) the HVAC,
electrical, plumbing, life-safety, and mechanical systems serving the Premises
are operational and in good condition and repair (based on comparable buildings
in the San Francisco downtown office market) as of the delivery of possession of
the Premises to Tenant; (ii) the Premises are in compliance with all applicable
laws as required and interpreted by the City and County of San Francisco as of
the delivery of possession of the Premises to Tenant, including, without
limitation, fire and life safety requirements, the Americans with Disabilities
Act, Title 24, seismic, construction and building codes; and (iii) the
Building’s foundation, floor slabs, roof, exterior walls, structural columns,
and common areas are in good condition and repair as of the delivery of
possession of the Premises to Tenant. Landlord shall cause to be maintained and
repaired in good order and condition (based on comparable buildings in the San
Francisco downtown office market) (i) the Building’s foundation, floor slabs,
roof, exterior walls, and structural columns, (ii) the Building’s systems
outside of the Premises (including, without limitation, the elevator, HVAC,
electrical, plumbing, life-safety, and mechanical systems), and (iii) the common
areas. Landlord shall be responsible at no cost to Tenant (after actual
knowledge or notice of any violation thereof from any governmental authority)
for causing the Premises to be in compliance with all applicable laws as
required and interpreted by the City and County of San Francisco as of the
delivery of possession of the Premises to Tenant.

 

13. LIENS:

Tenant shall not permit any mechanics’, materialmen’s or other liens to be filed
against the real property of which the Premises form a part nor against the
Tenant’s leasehold interest in the Premises, and, to the extent the same are
filed, Tenant shall cause the same to be discharged or bonded over within five
(5) business days after Tenant is notified of such filing. The Landlord shall
have the right at all reasonable times to post and keep posted on the Premises
any notices which it deems necessary for protection from such liens and Tenant
shall give Landlord at least ten (10) days’ prior notice of the date of
commencement of any construction on the Premises in order to permit the posting

 

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of such notices. If any such liens are filed, Landlord may, after such 5
business day period, without waiving its rights and remedies based on such
breach by Tenant and without releasing Tenant from any obligations, cause such
liens to be released by any means it deems proper, including payment in
satisfaction of the claim giving rise to such lien. Tenant shall pay to Landlord
at once, without notice or demand, any sum paid by Landlord to remove such liens
together with Landlord’s costs and attorneys’ fees and interest at the rate of
ten percent (10%) per annum from the date of payment.

 

14. INDEMNIFICATION:

To the fullest extent permitted by law, Tenant hereby assumes all risks and
waives all claims against Landlord for any damage to any tangible or intangible
property (including the resulting loss of use, economic losses and consequential
or resulting damages of any kind from any cause) or any injury to or death of
any person in or about the Premises or the Building arising at any time and from
any cause whatsoever other than solely by reason of the gross negligence or
willful act of Landlord, or its agents, or employees or contractors.
Notwithstanding Landlord’s negligence or breach of this Lease, Landlord shall
under no circumstances be liable for injury to Tenant’s business or for any loss
of income or profit therefrom. Tenant shall indemnify, defend and hold Landlord
harmless against all claims or liability for any injury or damage to any person
or property whatsoever: (a) occurring in, on, or about the Premises or any part
thereof; and (b) occurring in, on, or about any facilities (including without
limitation to the generality of the term “facilities”, elevators, stairways,
passageways or hallways) the use of which Tenant may have in conjunction with
other tenants of the Building, when such injury or damage shall be caused in
part or in whole by the act, neglect, fault of, or omission of any duty with
respect to the same, by Tenant, its agents, servants, employees or
invitees. Tenant further agrees to indemnify, defend and hold Landlord harmless
against and from any and all claims: (a) by or on behalf of any person, firm or
corporation, arising from the conduct or management of any work or thing
whatsoever done by the Tenant in or about or from transactions of the Tenant
concerning the Premises; (b) arising from any breach or default on the part of
Tenant in the performance of any covenant or agreement on the part of the Tenant
to be performed pursuant to the terms of this Lease, including, without
limitation, compliance with the Building rules and regulations; or (c) arising
from any act or negligence of the Tenant, or any of its agents, contractors,
servants, employees or licensees. The foregoing indemnifications include all
costs, attorney’s fees, expenses and liabilities incurred in connection with any
such claim or action or proceeding brought thereon.

 

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Furthermore, in case any action or proceeding is brought against Landlord by
reason of any such claims or liability, Tenant agrees to defend such action or
proceeding at Tenant’s sole expense. The provisions of this paragraph shall
survive the expiration or termination of this Lease with respect to any claims
or liability arising prior to such expiration or termination.

 

15. INSURANCE:

Tenant shall purchase at its own expense and keep in force during the term of
this Lease a policy of commercial general liability insurance against claims for
bodily injury, personal and advertising injury and property damage arising out
of or relating (directly or indirectly) to Tenant’s business operations, conduct
or use or occupancy of the Premises or the Building. Such insurance shall be on
an occurrence basis providing single limit coverage of not less than $2,000,000
per occurrence with an annual aggregate of not less than $2,000,000. Tenant may
satisfy the foregoing requirement with the combination of a $1,000,000 primary
policy and a $5,000,000 or more umbrella policy. The limits of said policy shall
not limit the liability of Tenant nor relieve Tenant of any obligation
hereunder. Said policy shall: (a) name by endorsement Landlord as an additional
insured, with such endorsement to be on such form and with such modifications as
Landlord may require; (b) be issued by an insurance company which is reasonably
acceptable to Landlord and licensed to do business in the State of California;
(c) have deductibles no larger than those typically carried by similarly
situated tenants; and (d) provide that said insurance shall not be canceled
unless ten (10) days’ prior written notice shall have been given to
Landlord. Said policy or certificates thereof shall be delivered to Landlord by
Tenant upon commencement of the term of this Lease and upon each renewal of said
insurance. No more often than every three years, Landlord may require Tenant to
reasonably increase the amount of such coverage if, in Landlord’s opinion, the
amount of such coverage is no longer equal to the coverages carried by tenants
in comparable office buildings in the San Francisco downtown office market.

Landlord shall maintain throughout the term of this Lease a policy of insurance
upon the Building insuring against such risks and in such amounts as Landlord
deems appropriate in his reasonable discretion. Landlord may, but shall not be
required to, carry earthquake insurance on the Building.

 

16. SUBROGATION:

Landlord and Tenant hereby waive any right that each may have against the other
on account of any loss or damage arising in any manner which is covered by
policies of insurance for fire

 

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and extended coverage, theft, public liability, workmen’s compensation or other
insurance now or hereafter existing during the term hereof. The parties each
agree to use their reasonable best efforts to have their respective insurance
companies waive any rights of subrogation that such companies may have against
Landlord or Tenant, as the case may be.

 

17. ASSIGNMENT AND SUBLETTING:

Tenant shall not Transfer this Lease without the prior written consent of
Landlord, which consent shall not be unreasonably withheld. A Transfer consists
of any of the following: (i) any assignment, encumbrance, mortgage or other
transfer, whether by operation of law or otherwise, of this Lease or any
interest herein; (ii) any sublease of the Premises or any part thereof, or
permitting any other person to occupy or use the Premises or any portion
thereof; or (iii) any sale or other transfer, including by consolidation, merger
or reorganization, of a majority of the capital stock, partnership interests or
membership interests of Tenant (if Tenant is a corporation, partnership or
limited liability company, respectively), at any time in the aggregate during
the term of this Lease. Notwithstanding the foregoing or anything contained
herein to the contrary, in no event shall the transfer of Tenant’s shares on a
nationally recognized stock exchange be deemed to be a Transfer. Any person to
whom any Transfer is made or sought to be made is a “Transferee.” Any Transfer
by Tenant shall not result in Tenant being released or discharged from any
liability under this Lease. As a condition to Landlord’s prior written consent
as provided for in this paragraph, the Transferee shall agree in writing to
comply with and be bound by all of the terms, covenants, conditions, provisions
and agreements of this Lease, and Tenant shall deliver to Landlord, promptly
after execution, an executed copy of each document evidencing the Transfer and
an agreement of said compliance by each Transferee. Landlord’s consent to one
Transfer shall not be deemed to be a consent to any subsequent Transfer and any
Transfer which does not comply with the provisions of this paragraph 17 shall be
void. Tenant shall pay all costs of Transfer, including without limitation, real
estate commissions and Landlord’s reasonable attorneys fees expended in
connection therewith, not to exceed $2,000 with respect to each such Transfer.

If Landlord consents to a Transfer, and as a condition thereto, Tenant shall pay
Landlord fifty percent (50%) of any Transfer Premium, derived by Tenant from
such Transfer. “Transfer Premium” shall mean: (i) for a lease assignment, all
consideration paid or payable therefor, and (ii) for a sublease, all rent,
additional rent or other consideration paid by such Transferee in excess of the
base rent payable by Tenant under

 

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this Lease (on a monthly basis and on a per rentable square foot basis if less
than all of the Premises is transferred). In any such computation, Tenant:
(a) may subtract any reasonable direct out-of-pocket costs incurred in
connection with such Transfer, such as advertising costs, brokerage commissions,
attorneys’ fees and leasehold improvements, amortized on a straight line basis
over the remaining term of this Lease (or the term of the sublease in the case
of a sublease) and (b) shall include in the “Transfer Premium” any consideration
for execution of the Transfer, including, without limitation, so-called “key
money” or other bonus amount paid by Transferee to Tenant, and any payments in
excess of fair market value for services rendered by Tenant to Transferee or in
excess of fair market value for assets, fixtures, inventory, equipment or
furniture transferred by Tenant to Transferee. Tenant shall pay the percentage
of the Transfer Premium due Landlord within thirty (30) days after Tenant
receives any Transfer Premium. As a condition to Transfer, the Transferee shall
verify in writing to Landlord all consideration paid or given or to be paid or
given for such Transfer. In addition, Landlord shall have the option, in the
event of any proposed assignment of the Lease or subletting of more than twenty
five percent (25%) of the Premises to terminate the Lease in its entirety as of
the proposed effective date of the proposed assignment or subletting. Such
option to terminate shall be exercised, if at all, by Landlord giving Tenant
written notice thereof within fifteen (15) days following Landlord’s receipt of
Lessee’s written request. Following any such termination by Landlord, Landlord
may lease all or some portion of the Premises to the prospective assignee or
subtenant proposed by Tenant without liability to Tenant. Landlord’s failure to
exercise its termination right shall not be construed as Landlord’s consent to
the proposed assignment or subletting.

Notwithstanding any provision in this Lease to the contrary, Landlord’s consent
shall not be required for, and its excess rent sharing and recapture rights
shall not apply to, but upon prior written notice to Landlord, (unless prior
notice is prohibited by applicable laws, rules or regulations, in which event
notice will be given to Landlord promptly following said transaction), any
assignment of the Lease or sublease of the Premises by Tenant to any of the
following (an “Approved Transferee”): (1) any corporation or other entity which
controls, is controlled by, or is under common control with Tenant; (2) any
corporation or other entity resulting from the merger or consolidation of
Tenant; and (3) any corporation or other entity or person which acquires a
controlling interest in the corporate stock of Tenant or acquires substantially
all of the assets of Tenant, provided that (a) in the case of an assignment,
said assignee assumes in full the obligations of Tenant under this Lease, and
(b) in the case of a sublease, at Landlord’s request following said transaction,
said

 

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subtenant will execute an agreement acceptable to Landlord, Tenant and
subtenant, whereby subtenant agrees to (xx) be bound by the terms of this Lease
and (yy) at Landlord’s request, attorn to Landlord in the event of a termination
of the Lease by reason of a Tenant default (in which event the sublease will
become a direct lease between Landlord and subtenant and Landlord will recognize
subtenant’s rights under such sublease and not disturb subtenant’s possession of
the Premises. For the purposes of this paragraph, the words “control”,
“controls” and “controlled” shall mean the right and power (direct or indirect)
to direct or cause the direction of the management policies of a person or
entity (corporation or otherwise) through ownership or voting securities, by
contract or otherwise. Tenant’s foregoing rights to assign this Lease or
sublease the Premises without the consent of Landlord shall be subject to the
following conditions: (i) Tenant shall notify Landlord of any such assignment or
sublease at least ten (10) days prior thereto (unless prior notice is prohibited
by applicable laws, rules or regulations, in which event notice will be given to
Landlord promptly following said transaction); (ii) in the case of an
assignment, the transferee or successor entity shall assume in writing Tenant’s
obligations hereunder; (iii) Tenant shall remain liable for all obligations and
liabilities of Tenant under this Lease; and (iv) in the case of an assignment,
the transferee of successor entity shall have a tangible net worth which is at
least equal to the greater to the net worth of Tenant as of the date of this
Lease or the net worth of Tenant immediately prior to the date of the
assignment. Tenant and the proposed assignee/sublessee shall provide such
documentation as may be reasonably requested by Landlord to demonstrate to
Landlord’s reasonable satisfaction that the conditions set forth above have been
satisfied.

 

18. RULES AND REGULATIONS:

Tenant shall faithfully comply with the reasonable rules and regulations,
together with all modifications and additions thereto applying to the Building
and other tenants thereof adopted by Landlord from time to time in
writing. Landlord shall not be responsible for the non-performance by any other
tenant or occupant of the Building of any of said rules and regulations, but
shall use commercially reasonable efforts to uniformly enforce the same. In the
event of a conflict between such rules and regulations and this Lease, this
Lease shall control. A copy of the current rules and regulations is attached
hereto as Exhibit D. Landlord hereby approves of the window treatment described
on Exhibit E.

 

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19. ENTRY BY LANDLORD:

Upon reasonable prior notice (not less than 24 hours), or in an emergency
without notice, Landlord shall have the right to enter the Premises: (a) to
inspect them, (b) to supply any service provided to Tenant hereunder, (c) to
show the Premises to prospective purchasers, lenders or tenants (but such right
with respect to tenants shall only be permitted during the last 9 months of the
term), (d) to post notices of nonresponsibility, (e) to alter, improve or repair
the Premises and any portion of the Building, and (f) to erect scaffolding and
other necessary structures outside of the Premises, where required by the work
to be performed, all without reduction of rent. In connection with any such
entry, Landlord shall use commercially reasonable efforts not to unreasonably
interfere with the conduct of Tenant’s business on the Premises. Tenant hereby
waives any claims for damages for any injury to or interference with Tenant’s
business or quiet enjoyment of the Premises or any other loss occasioned by such
entry provided that Landlord shall use commercially reasonable efforts not to
unreasonably interfere with the conduct of Tenant’s business on the
Premises. Landlord shall at all times have a key to unlock all of the doors in
and about the Premises, excluding Tenant’s vaults and safes, and Landlord shall
have the right to use any means which Landlord deems proper to open said doors
in any emergency, and any such entry to the Premises shall not under any
circumstances be construed or deemed to be a forcible or unlawful entry into the
Premises or a detainer of the Premises or an eviction of Tenant from any portion
of the Premises.

 

20. INSOLVENCY OR BANKRUPTCY:

The appointment of a receiver to take possession of all or substantially all of
the assets of Tenant, or any assignment by Tenant for the benefit of creditors,
or any action taken or suffered by Tenant under any insolvency, bankruptcy, or
reorganization act, shall at Landlord’s option constitute a breach of this Lease
by Tenant if not released within 90 days. On the happening of any such event or
at any time thereafter this Lease shall terminate five days after written notice
of termination from Landlord to Tenant. In no event shall this Lease be assigned
or assignable by operation of law or by voluntary or involuntary bankruptcy
proceedings or otherwise and in no event shall this Lease or any rights or
privileges hereunder be an asset of Tenant under any bankruptcy, insolvency, or
reorganization proceedings. In the event that any provisions of this paragraph
are not enforceable as a matter of law, Landlord shall retain its rights under
paragraph 17 above.

 

21. DEFAULT:

The failure to perform or honor each covenant, condition and representation made
under this Lease shall constitute a default

 

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hereunder by Tenant upon expiration of the appropriate grace period hereinafter
provided. Tenant shall have a period of five (5) business days from the date of
written notice from Landlord within which to cure any default in the payment of
rental or adjustment thereto or any other sums hereunder. Tenant shall have a
period of thirty (30) days, after written notice from Landlord within which to
cure any other default under this Lease; provided, however, that with respect to
defaults which cannot be reasonably cured within thirty (30) days, the default
shall not be deemed to be uncured if Tenant commences to cure within thirty
(30) days from Landlord’s notice and continues to prosecute diligently the
curing thereof. Said written notices shall constitute those required under CCP
§ 1161 et seq. Acceptance of a payment which is less than the amount then due
shall not be a waiver of Landlord’s rights to the balance of such rent,
regardless of Landlord’s endorsement of any check so stating. Upon an uncured
default of this Lease by Tenant, Landlord shall have the following rights and
remedies in addition to any other rights or remedies available to Landlord at
law or in equity:

(a) The rights and remedies provided by California Civil Code Section 1951.2,
including but not limited to, recovery of the worth at the time of award of the
amount by which the unpaid rent for the balance of the term after the time of
award exceeds the amount of rental loss for the same period that the Tenant
proves could be reasonably avoided, as computed pursuant to Section 1951.2(b);

(b) The rights and remedies provided by California Civil Code Section 1951.4
(Landlord may continue the lease in effect after Tenant’s breach and abandonment
and recover rent as it becomes due, if Tenant has right to sublet or assign,
subject only to reasonable limitations). Acts of maintenance or preservation,
efforts to relet the Premises, or the appointment of a receiver upon Landlord’s
initiative to protect its interest under this Lease shall not constitute a
termination of Tenant’s right to possession. At the option of Landlord, rents
received from any such subletting shall be applied first, to payment of any
indebtedness other than rent due hereunder, from Tenant to Landlord; second, to
the payment of any costs of such subletting and of such alterations and repairs;
third, to payment of rent due and unpaid hereunder; and the residue, if any,
shall be held by Landlord and applied in payment of future rent as the same
becomes due hereunder. No taking possession of the Premises by Landlord shall be
construed as an election on its part to terminate this Lease unless a written
notice of such intention be given to Tenant. Notwithstanding any such subletting
without termination, Landlord may at any time thereafter elect to terminate this
Lease for such previous breach;

 

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(c) The right to terminate this Lease by giving notice to Tenant in accordance
with applicable law;

(d) The right and power to enter the Premises and remove therefrom all persons
and property, to store such property in a public warehouse or elsewhere at the
cost of and for the account of Tenant, and to sell such property and apply the
proceeds therefrom pursuant to applicable California law. ; and

(e) The right to have a receiver appointed for Tenant, upon application by
Landlord, to take possession of the Premises and to apply any rental collected
from the Premises.

(f) All sums due from Tenant to Landlord not paid when due shall bear interest
at ten (10%) percent per annum.

Landlord shall be deemed to be in default of this Lease if Landlord fails to
make any payments to Tenant required under this Lease and such failure continues
for ten (10) days after written notice from Tenant to Landlord, or if Landlord
shall be in default in the performance of any other of its covenants or
agreements contained in this Lease and such default in performance continues for
more than thirty (30) days after written notice thereof from Tenant to Landlord
specifying the particulars of such default or breach of performance; provided,
however, that if the default complained of, other than for the payment of
monies, is of such a nature that the same cannot be rectified or cured within
such thirty (30) day period, then such default shall be deemed to be rectified
or cured if Landlord, within such thirty (30) day period, shall have commenced
such cure and shall continue thereafter with diligence to cause such cure to be
completed. Upon any default of this Lease by Landlord, Tenant shall be entitled
to pursue any and all remedies available to Tenant at law or in equity.

 

22. LANDLORD’S RIGHT TO CURE DEFAULT:

All covenants and agreements to be kept or performed by Tenant under the terms
of this Lease shall be performed by Tenant at Tenant’s sole cost and expense and
without any reduction of rent. If Tenant shall be in default on its obligations
under this Lease to pay any sum of money other than payment of rent or perform
any other act hereunder, and if such default is not cured within the applicable
grace period provided in paragraph 21 hereof, Landlord may, but shall not be
obligated to, make such payment or perform any such act on Tenant’s part without
waiving its right based upon default of Tenant and without releasing Tenant from
any obligations hereunder. All sums so paid by Landlord and all incidental
costs, together with interest thereon at the rate of ten percent (10%) per annum
from the date of such

 

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payment or the incurrence of such cost by Landlord, whichever occurs first,
shall be paid to Landlord on demand. In the event of nonpayment by Tenant,
Landlord shall have, in addition to any other rights or remedies hereunder, the
same rights and remedies as in the case of default.

 

23. DAMAGE BY FIRE OR CASUALTY:

23.1 Partial Damage – Insured. In the event the Premises or the Building are
damaged by any casualty which is covered under fire and extended coverage
insurance carried by Landlord, then Landlord shall restore such damage provided
insurance proceeds are available to pay eighty percent (80%) or more of the cost
of restoration and provided such restoration can be completed within sixty
(60) days after the commencement of the work in the opinion of a registered
architect or engineer appointed by Landlord. In such event this Lease shall
continue in full force and effect, except that Tenant shall be entitled to
proportionate reduction of rent while such restoration takes place, such
proportionate reduction to be based upon the extent to which the restoration
efforts interfere with Tenant’s business in the Premises.

23.2 Partial Damage – Uninsured. In the event the Premises or the Building are
damaged by a risk not covered by Landlord’s insurance or the proceeds of
available insurance are less than eighty (80%) of the cost of restoration, or if
the restoration cannot be completed within sixty (60) days after the
commencement of work in the opinion of the registered architect or engineer
appointed by Landlord, then Landlord shall have the option either to (1) repair
or restore such damage, this Lease continuing in full force and effect, but the
rent to be proportionately abated as hereinabove provided, or (2) give notice to
Tenant at any time within thirty (30) days after such damage terminating this
Lease as of a date to be specified in such notice, which date shall be not less
than thirty (30) nor more than sixty (60) days after giving such notice. In the
event of the giving of such notice, this Lease shall expire and all interest of
Tenant in the Premises shall terminate on such date so specified in such notice
and the rent, reduced by any proportionate reduction based upon the extent, if
any, to which said damage interfered with the use and occupancy of Tenant, shall
be paid to the date of such termination; Landlord agrees to refund to the Tenant
any rent theretofore paid in advance for any period of time subsequent to such
date.

23.3 Total Destruction. In the event the Premises are totally destroyed or the
Premises cannot be restored as required herein under applicable laws and
regulations, notwithstanding the availability of insurance proceeds, this Lease
shall be terminated effective the date of the damage.

 

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23.4 Damage Near End of the Term. Notwithstanding anything to the contrary
contained in this Section 23, Landlord shall not have any obligation whatsoever
to repair, reconstruct or restore the Premises when the damage resulting from
any casualty covered under this Section 23 occurs during the last twelve
(12) months of the term of this Lease or any extension thereof.

23.5 Landlord’s Obligations. The Landlord shall not be required to repair any
injury or damage by fire or other cause or to make any restoration or
replacement of any paneling, decorations, partitions, railings, floor coverings,
office fixtures or any other improvements or property installed in the Premises
by Tenant or at the direct or indirect expense of Tenant. Tenant shall be
required to restore or replace same in the event of damage. Except for abatement
of rent, if any, Tenant shall have no claim against Landlord for any damage
suffered by reason of any such damage, destruction, repair or restoration; nor
shall Tenant have the right to terminate this Lease as a result of any statutory
provision now or hereafter in effect pertaining to the damage and destruction of
the Premises or the Building, except as expressly provided herein.

23.6 Tenant Termination Right. Notwithstanding the foregoing, if the Premises
are (a) materially damaged by fire or other casualty during the last twelve
(12) months of the term and not restored within 60 days after the date of such
fire or casualty, or (b) materially damaged by fire or other casualty and not
restored within 180 days after the date of such fire or other casualty, then
Tenant shall have the right, exercisable by notice to Landlord delivered within
thirty (30) days after the date of such fire or other casualty (with respect to
clause (a) above) or within 210 days after the date of such fire or other
casualty (with respect to clause (b) above), to terminate this Lease, effective
as of the date of delivery of such notice.

 

24. EMINENT DOMAIN:

If any part of the Premises shall be taken or appropriated under the power of
eminent domain or conveyed in lieu thereof, either party shall have the right to
terminate this Lease at its option. If any part of the Building shall be taken
or appropriated under power of eminent domain or conveyed in lieu thereof,
Landlord may terminate this Lease at its option. In either of such events,
Landlord shall receive such portions of the condemnation award as the court
shall allow. If a part of the Premises shall be so taken or appropriated
or conveyed and neither party hereto shall elect to terminate this Lease and the
Premises have been damaged as a consequence of such partial

 

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taking or appropriation or conveyance, the Landlord shall restore the Premises
continuing under this Lease at the Landlord’s cost and expense; provided,
however, that Landlord shall not be required to repair or restore any injury or
damage to the property of Tenant or to make any repairs or restoration of any
alterations, additions, fixtures or improvements installed on the Premises by or
at the expense of Tenant. Thereafter, the rent to be paid under this Lease for
the remainder of its term shall be proportionately reduced, such reduction to be
based upon the extent to which the partial taking or appropriation or conveyance
shall interfere with the business carried on by Tenant on the Premises. In the
event of a taking, nothing contained herein shall prevent Tenant from making a
claim for damages and expenses associated with the Tenant Improvements or its
moving expenses.

 

25. SURRENDER OF PREMISES:

A voluntary surrender or other surrender of this Lease by Tenant or the mutual
cancellation of this Lease shall not work a merger. Any surrender or mutual
cancellation of this Lease shall operate as an automatic assignment to Landlord
of any subleases or subtenancies.

 

26. HOLDING OVER:

Any holding over after the expiration of the term of this Lease with the written
consent of Landlord shall be a tenancy from month to month upon the same terms,
covenants and conditions herein, the monthly rental shall be determined by
Landlord and contained in the written consent, subject to adjustment as provided
in paragraph 5 herein. Landlord may thereafter terminate such tenancy on 5
business days written notice. Acceptance by Landlord of rent after such
expiration shall not result in any other tenancy or any renewal of the term of
this Lease, and the provisions of this paragraph are in addition to and do not
affect Landlord’s right of re-entry or other rights provided under this Lease or
by applicable law.

If Tenant shall retain possession of the Premises or any part thereof without
Landlord’s written consent following the expiration or sooner termination of
this Lease for any reason, then Tenant shall pay to Landlord for each day of
such retention 150% of the amount of the daily rental for the last period prior
to the date of such expiration or termination. Tenant shall also indemnify and
hold Landlord harmless from any loss or liability resulting from delay by Tenant
of more than thirty (30) days in surrendering the Premises, including, without
limitation, any claims made by any succeeding tenant founded on such delay.

 

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27. SALE BY LANDLORD:

In the event that Landlord sells or conveys the Premises, Landlord shall be
released from any liability arising thereafter based upon any of the terms,
covenants or conditions, express or implied, which are contained in this
Lease. In such event, Tenant agrees to look solely to Landlord’s successor in
interest for any liability under this Lease arising after the date of such
Transfer. If any security has been given by Tenant to secure the faithful
performance of any of the covenants of this Lease, Landlord shall transfer or
deliver said security, as such, to Landlord’s successor in interest and
thereupon Landlord shall be discharged from any further liability with regard to
said security. Except as set forth in this paragraph, this Lease shall not be
affected by any sale or conveyance of the Premises by Landlord, and Tenant
agrees to attorn in writing to Landlord’s successor in interest.

 

28. ESTOPPEL CERTIFICATE:

Within fifteen (15) days after notice from Landlord, Tenant shall execute and
deliver to Landlord, in recordable form, a certificate stating that this Lease
is unmodified and in full force and effect, or in full force and effect as
modified, and stating the modifications. The certificate also shall state the
amount of minimum monthly rent, the dates to which the rent has been paid in
advance, the amount of any security deposit or prepaid rent, the fact that to
the best of Tenant’s actual knowledge there are no current defaults under the
Lease by either Landlord or Tenant except as specified in such statement, and
such other matters reasonably requested by Landlord. Tenant acknowledges that
any statement delivered pursuant to this paragraph may be relied upon by any
mortgagee, beneficiary, purchaser or prospective purchaser of the Building or
any interest therein. Failure to deliver the certificate within said fifteen
(15) days shall be conclusive upon Tenant that this Lease is in full force and
effect and has not been modified except as may be represented by Landlord.

 

29. SUBORDINATION AND ATTORNMENT:

This Lease is and shall be subject and subordinate at all times to all ground or
underlying leases which now exist or may hereafter be executed or amended
affecting the Building or the land upon which the Building is situated, or both,
and to the lien of any mortgages or deeds of trust in any amount or amounts
whatsoever which now exist or may hereafter be executed or amended on or against
the land and Building or either of them, of which the Premises are a part, or on
or against Landlord’s interest or estate therein, without the necessity of the

 

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execution and delivery of any further instruments on the part of Tenant to
effectuate such subordination. Notwithstanding the foregoing, Tenant covenants
and agrees to execute and deliver upon demand to Landlord such further
instruments in recordable form evidencing such subordination of this Lease to
such ground or underlying leases and to the lien of any such mortgages or deeds
of trust as may be reasonably required by Landlord, including a statement from
Tenant as to any claimed offsets of Tenant. As to any mortgages, deeds of trust
or ground leases hereafter executed that affect Landlord’s estate or any
interest of Landlord in the real property or any part thereof of which the
Premises form a part or any renewals, modifications, replacements or extensions
of existing mortgages, deeds of trust or ground leases, they shall not be
effective to disturb the terms hereof or Tenant’s occupancy hereunder so long as
Tenant is not in default under the terms and conditions of this Lease. Any
holder of a mortgage or deed of trust may elect to have this Lease superior to
the lien of its mortgage or deed of trust by giving written notice thereof to
Tenant, whereupon this Lease shall be deemed prior to such mortgage or deed of
trust notwithstanding the relative dates of the documentation or recordation
thereof. Landlord shall use commercially reasonable efforts to obtain a non
disturbance agreement for the benefit of Tenant from the current holder of the
deed of trust on the Property.

Upon the written request of the Landlord or any mortgagee or beneficiary of
Landlord, Tenant will in writing attorn to any such mortgagee or
beneficiary. Said agreement of attornment shall provide, among other things,
(a) that this Lease shall remain in full force and effect, (b) that Tenant shall
pay rent to said mortgagee or beneficiary from the date of said attornment,
(c) that mortgagee or beneficiary shall not be responsible to Tenant under this
Lease except for obligations accruing subsequent to the date of such attornment
(except for repair and maintenance obligations of a continuing nature and the
payment in full of the tenant improvement allowance described in the Work
Letter), and (d) that Tenant, in the event of foreclosure or deed in lieu
thereof, will enter into a new lease with the lien holder acquiring title on the
same terms and conditions as the existing Lease and for the balance of the term
hereof.

The provisions of this Lease may require approval by financial institutions
which make the loans herein contemplated. If any such institution should require
as a condition of such financing any modification of the provisions of this
Lease, Tenant will approve and execute any such modifications, provided no such
modifications shall relate to the rent payable hereunder, the length of the term
or materially change the rights or obligations of Landlord or Tenant to each
other.

 

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30. WAIVER:

If Landlord waives the performance of any term, covenant or condition contained
in this Lease, such waiver shall not be deemed to be a waiver of the term,
covenant or condition itself or a waiver of any subsequent breach of the same or
any other term, covenant or condition contained herein. Furthermore the
acceptance of rent or late charge by Landlord shall not constitute a waiver of
any preceding breach by Tenant of any term, covenant or condition of this Lease,
regardless of Landlord’s knowledge of such preceding breach at the time Landlord
accepted such rent or late charge. Failure by Landlord to enforce any of the
terms, covenants or conditions of this Lease for any length of time shall not be
deemed to waive or to decrease the right of Landlord to insist thereafter upon
strict performance by Tenant. Waiver by Landlord of any term, covenant or
condition contained in this Lease may only be made by a written document signed
by Landlord.

 

31. LANDLORD’S DEFAULT:

If Tenant obtains a money judgment against Landlord resulting from any default
or other claim arising under this Lease, such judgment shall be satisfied only
out of the rents, profits and income received by Landlord with respect to its
right, title and interest in the Building and the underlying real property. No
other real, personal or mixed property of Landlord (or of any of the individuals
who comprise Landlord) shall be subject to levy to satisfy any such judgment.

 

32. ATTORNEYS’ FEES:

In the event that any action or proceeding is brought to enforce any term,
covenant or condition of this Lease on the part of Landlord or Tenant, the
prevailing party in such litigation shall be entitled to reasonable attorneys’
fees and expert fees and costs to be fixed by the Judge presiding in such action
or proceeding.

 

33. INTENTIONALLY OMITTED

 

34. NOTICES:

Notices (including any notice to be served on Tenant pursuant to Code of Civil
Procedure Section 1162) will be deemed to have been delivered upon the sooner of
personal delivery or forty-eight (48) hours after they have been deposited with
a reputable overnight courier service (such as Federal Express), addressed to
the Tenant at 1601 Trapelo Road, Waltham,

 

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Massachusetts 02451 Attention: Robert P. Nault Esq. with a copy to Wilmer Cutler
Pickering Hale and Dorr LLP, 60 State Street, Boston, MA 02109 Attention: Paul
Jakubowski, Esq. and to Landlord at 27 Maiden Lane, Suite 250, San Francisco,
California 94108 and to either of them at such other places as they may from
time to time designate by written notice. Either may request duplicate notices
to themselves or third parties. Any deed of trust holders shall have a
reasonable opportunity (not to exceed 60 days) after receipt of each such notice
in which to cure all defaults on the part of Landlord. In the event it is
necessary for said first deed of trust holders to enter upon the Premises in
order to effect said cure, the right of entry shall be deemed to have been
granted by this provision.

 

35. DEFINED TERMS AND HEADINGS:

The words “Landlord” and “Tenant” as used herein shall include the plural as
well as the singular. Words used in masculine gender include the feminine and
neuter, where applicable. If there is more than one Tenant, the obligations
imposed under this Lease upon Tenant shall be joint and several. The headings
and titles to the paragraphs of this Lease are used for convenience only and
shall have no effect upon the construction or interpretation of the Lease. No
party other than Landlord and Tenant and their successors and assigns shall be
entitled to the benefits of this Lease: there are no third party beneficiaries
to this Lease.

 

36. TIME AND APPLICABLE LAW:

Time is of the essence of this Lease and all of its provisions. This Lease shall
in all respects be governed by the laws of the State of California.

 

37. SUCCESSORS AND ASSIGNS:

Subject to the provisions of paragraph 17 hereof, the terms, covenants and
conditions contained herein shall be binding upon and inure to the benefit of
the heirs, successors, executors, administrators and assigns of the parties
hereto.

 

38. ENTIRE AGREEMENT:

This Lease, together with its exhibits, contains all the agreements of the
parties hereto and supercedes any previous negotiations. There have been no
representations made by the Landlord or understandings made between the parties
other than those set forth in this Lease and its exhibits. This Lease may not be
modified except by a written instrument duly executed by the parties hereto.

 

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39. SEVERABILITY:

If any provision of this Lease or the application thereof to any person or
circumstance shall be invalid or unenforceable to any extent, the remainder of
this Lease and the application of such provision to other persons or
circumstances shall not be affected thereby and shall be enforced to the
greatest extent permitted by law. If any payments or interest hereunder shall at
any time be in violation of any California usury laws or otherwise in violation
of law, they shall be reduced to an amount equal to the maximum permitted under
California law.

 

40. QUIET ENJOYMENT:

Landlord agrees to and shall in the commencement of this Lease place Tenant in
quiet possession of the Premises and shall secure it in the quiet possession
thereof against all persons lawfully claiming the same during the term of this
Lease.

 

41. LIGHT AND AIR:

Tenant covenants and agrees that no diminution of light, air or view by any
structure which may hereafter be erected (whether or not by Landlord) shall
entitle Tenant to any reduction of rent under this Lease, result in any
liability of Landlord to Tenant, or in any other way affect this Lease or
Tenant’s obligations hereunder.

 

42. OFFER:

Preparation of this Lease by Landlord or Landlord’s agent and submission of same
to Tenant shall not be deemed an offer to lease. This Lease shall become binding
upon Landlord and Tenant only when fully executed by Landlord and Tenant.

 

43. OPTION TO RENEW:

43.1. Option to Renew. Provided Tenant is not in default under the terms of this
Lease beyond any applicable cure period either at the time of exercise of this
option or at commencement of the option period, Tenant shall have an option to
renew this Lease for one (1) additional period of five (5) years commencing upon
the expiration of the initial term of this Lease. Said option shall be on the
same terms, covenants and conditions contained herein except that the Base Rent
shall be fixed in the manner set forth below. This option may be exercised only
by written notice to Landlord delivered no earlier than November 1, 2016 and no
later than January 1, 2017. The Base Rent during the option period shall be the
fair market rental value of the

 

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Premises as of the first day of the option period. “Fair market rental value”
shall be established in accordance with section 43.2 below. Notwithstanding the
foregoing, the Base Rent shall not be less than the Base Rent payable
immediately prior to the commencement of the option period. This option is
personal to Constant Contact, Inc. and an Approved Transferee and shall be
exercisable only by Constant Contact, Inc., or an Approved Transferee and not
any other assignee, sublessee or other transferee of Tenant’s interest in this
Lease and only if Constant Contact, Inc. or an Approved Transferee occupies the
entire Premises as of the date it exercises this option.

43.2. Fair Market Rental Value. Fair market rental value means the rent a tenant
would pay for a five year term for the Premises based on the prevailing rent
being charged to tenants for comparable space in comparable buildings for the
period coinciding with the option period, taking into account all relevant
factors. Fair market rental value shall be determined in the following
manner. At least ninety (90) days prior to the commencement of the option
period, Landlord shall notify Tenant of its determination of fair market rental
value. Tenant shall have thirty (30) days from the date of such notice to notify
Landlord that it disagrees with such determination. In the event Tenant does not
so timely notify Landlord, Tenant shall be deemed to have disagreed with
Landlord’s determination. In the event Tenant disagrees with Landlord’s
determination, Landlord and Tenant shall each specify within fifteen (15) days
from Landlord’s receipt of such notice the name and address of a person to act
as the appraiser on its behalf. The appraiser shall be a licensed real estate
appraiser or licensed real estate broker with at least fifteen (15) years of
appraisal or leasing experience with the San Francisco downtown office
market. The two appraisers so appointed shall meet within thirty (30) days of
their appointment to determine if they can agree upon the fair market rental
value and, if so, the fair market rental value shall be as agreed. If the two
appraisers so appointed cannot agree upon the fair market rental value, the two
appraisers within forty five (45) days of their appointment shall appoint a
third appraiser who shall be a competent and impartial person with
qualifications similar to those required of the first two appraisers. If either
party fails to appoint an appraiser, or the two appraisers fail to appoint a
third, in either case, within ten (10) days after demand by either party, the
necessary appraiser shall be appointed by the San Francisco Superior Court or,
in its failure or refusal to act, the then Dean of the Graduate School of
Business of the University of California at Berkeley.

If the two appraisers selected by Landlord and Tenant cannot reach agreement on
the prevailing fair market rental

 

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value, the value shall be established by the three appraisers in accordance with
the following procedure. The appraisers selected by Landlord and Tenant shall
state in writing his or her determination of the prevailing fair market rental
value and shall arrange for a simultaneous delivery of such determinations to
the third appraiser. The role of the third appraiser shall be to select which of
the two proposed determinations most closely approximates his determination of
the fair market rental value. The third appraiser shall have no right to propose
a middle ground or any modification of either of the two proposed
determinations. The determination he chooses as most closely approximating his
determination shall constitute the decision of the appraisers and be final and
binding upon the parties. Each party shall pay the cost of its own appraiser and
shall share the cost of the third appraiser, if any.

In the event the appraisers have not determined the fair market rental value as
of the date for the rental adjustment, Tenant shall on an interim basis pay
Landlord Base Rent based on the Landlord’s determination of fair market rental
value. In the event the third appraiser’s determination is less than Landlord’s
determination, Tenant shall be entitled to a credit against the next rental
payment(s) payable by Tenant hereunder in the amount of such
difference. Alternatively, if the third appraiser’s determination is more than
Landlord’s determination, Tenant shall pay such difference with the next rental
payment owing.

 

44. SIGNAGE:

Landlord shall include Tenant’s name in any Building-standard directory signage,
in accordance with Landlord’s Building signage program. Subject to Landlord’s
consent, which shall not be unreasonably withheld, conditioned or delayed,
Tenant shall have the right, at its sole cost and expense, to install
(i) signage at the entrance to the Premises; and (ii) window signage and
graphics in the two windows at the corner of Second and Market Streets, which
shall no larger than the display in such windows by the current tenant. The
initial window display approved by Landlord is attached hereto as Exhibit F.
Upon Lease termination, Tenant shall at its expense remove any signage or
graphics installed by Tenant and restore the same to the condition existing
prior to the installation of the same.

 

45. BICYCLE STORAGE SPACE:

Landlord shall provide Tenant with an area designated by Landlord in the
basement of the Building (the “Bicycle Space”) for the purpose of placing a
bicycle rack which can hold up to ten (10) bicycles. Tenant shall use the
Bicycle Space exclusively

 

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for the temporary storage of bicycles. Tenant accepts the Bicycle Space in its
“as is” condition with no security and agrees that Landlord shall have no
responsibility for any theft of or damage to the bicycles. The provisions of
this Lease, including without limitation paragraph 14 above, shall apply with
respect to the Bicycle Space and Tenant’s use thereof. Landlord makes no
representations with respect to the Bicycle Space or Tenant’s intended use
thereof, including, without limitation, that applicable codes permit: (i) the
use of the Bicycle Space for the storage of bicycles; or (ii) use the auto
access ramp for bicycle ingress and egress to the Bicycle Space. Tenant assumes
all risks with respect to the availability and nature of the ingress and egress
to the Bicycle Space and shall comply with all applicable laws, rules, codes,
ordinances or regulations regarding the use of the Bicycle Space and the ingress
and egress thereto. Upon the request of Landlord, Tenant shall provide Landlord
with such evidence as Landlord may reasonably request that Tenant’s insurance
required in paragraph 15 covers any injury to persons or damage to property
resulting from the ingress and egress to, and the use of, the Bicycle Space by
Tenant or its employees or invitees. In the event that Landlord determines in
its reasonable discretion that Tenant’s use of the automobile ramp is
detrimental to the safety of persons using the automobile ramp or to the
functionality of the Building, Landlord shall have the right at its expense to:
(i) provide Tenant with other access to the Bicycle Space in lieu of the access
via the automobile ramp, such as access by means of the freight elevator or a
ramp constructed by Landlord; and/or (ii) relocate the Bicycle Space to a ground
level covered shed on the north side of the Building.

 

46. BROKERS

Except for Cushman & Wakefield (“Landlord’s Broker”) and Richards Barry and
Joyce & Partners, LLC and Studley Inc. (together, “Tenant’s Broker”), Landlord
and Tenant each respectively represents to the other that it has dealt with no
person, firm, real estate broker or finder in respect of leasing or renting
space in the Building. Further, Landlord and Tenant each respectively agrees for
the benefit of the other party that, if it has dealt with any other person,
firm, real estate broker or finder in respect of leasing or renting space in the
Building, it shall be solely responsible for the payment of any fee due to such
other person, firm, broker or finder and it shall indemnify, protect and hold
the other party free and harmless from and against any liability in respect
thereto, including any of the other party’s reasonable attorneys’ fees incurred
in connection therewith. Landlord shall pay to Landlord’s Broker a fee as set
forth in a separate agreement between Landlord and Landlord’s Broker for
services rendered by Landlord’s Broker in this transaction.

 

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease on the 29th day
of May, 2012.

 

   LANDLORD:    

/s/ Edward J. Conner

      EDWARD J. CONNER    TENANT:     CONSTANT CONTACT, INC.,       a Delaware
corporation       By:  

/s/ Robert P. Nault

      Its:  

Vice President & General Counsel

 

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LIST OF EXHIBITS

 

Exhibit A    Premises (Intentionally omitted) Exhibit B    Work Letter Exhibit C
   Janitorial Specifications (Intentionally omitted) Exhibit D    Rules and
Regulations (Intentionally omitted) Exhibit E    Approved Window Treatment
(Intentionally omitted) Exhibit F    Approved Window Display (Intentionally
omitted)

 

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Exhibit B

WORK LETTER AGREEMENT

This Work Letter Agreement (the “Agreement”) supplements the Lease dated May 29,
2012, executed concurrently herewith by and between EDWARD J. CONNER, Landlord,
and CONSTANT CONTACT, INC., a Delaware corporation, Tenant.

 

  A. General.

(a) The purpose of this Agreement is to set forth how the Tenant Improvements
(as defined in Section 4 below) in the Premises are to be constructed, who will
undertake the construction of the Tenant Improvements, who will pay for the
construction of the Tenant Improvements, and the procedure for preparation and
Landlord’s approval of the Final Plans (as defined in Section 2 below).

(b) Except as defined in this Agreement to the contrary, all terms used in this
Agreement shall have the same meaning given them in the Lease. When work or
services are to be provided by or on behalf of Landlord, the term “Landlord”
shall include Landlord’s agents, contractors, employees and affiliates.

(c) The provisions of the Lease, except to the extent inconsistent or
inapplicable to this Agreement, are incorporated into this Agreement.

(d) The Tenant Improvements shall be constructed by Tenant pursuant to this
Agreement. Landlord shall provide the Tenant Improvement Allowance (as defined
in Section 5(a) below).

(e) Tenant shall make all improvements to the Premises other than Landlord’s
Work. All work done by or for Tenant on the Premises shall be in conformity with
all applicable Laws. The term “Laws” as used in this Agreement shall mean all
laws, statutes, codes, rules or regulations applicable to the Building. Tenant
shall obtain at its expense all necessary permits for construction of the Tenant
Improvements.

(f) The provisions of the Lease other than the payment of Base Rent and
Additional Rent shall apply with respect to the period prior to the Commencement
Date that Tenant has access to the Premises.

2. Preparation of Plans. Tenant shall arrange for the preparation of the plans
and specifications for its proposed Tenant Improvements in accordance with this
paragraph 2.

(a) Selection of Designer. Tenant shall retain an architect approved by Landlord
(“Designer”) to design the

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Tenant Improvements; such approval not to be unreasonably withheld, conditioned
or delayed. Landlord hereby approves Visnick & Caulfield and NicholsBooth
Architects as Designer.

(b) Preparation and Approval of Space Plan. Tenant shall contract with the
Designer to prepare a space plan approved by Landlord (“Space Plan”), such
approval not to be unreasonably withheld, conditioned or delayed.

(c) Preparation and Approval of Working Drawings.

(i) Tenant shall submit to Landlord drawings prepared by the Designer (“Working
Drawings”) which shall be compatible with the design, construction and equipment
of the Building, be capable of logical measurement and construction, contain all
such information as may be required for the construction of the Tenant
Improvements and contain all partition locations, plumbing locations, air
conditioning system and duct work, special air conditioning requirements,
reflected ceiling plans, office equipment locations, and special security
systems.

(ii) Landlord shall approve the Working Drawings within five (5) business days
after receipt of same or designate by notice given within such time period to
Tenant the specific changes reasonably required to be made to the Working
Drawings and shall return the Working Drawings to Tenant; provided that Landlord
shall only be permitted to designate changes to the Working Drawings to the
extent the Working Drawings are inconsistent with the Space Plan. In the event
that Landlord fails to approve or disapprove the Working Drawings within such
five (5) business day period, Tenant may deem the Working Drawings to be
approved by Landlord. Tenant shall make the changes necessary and shall return
the Working Drawings to Landlord, which Landlord shall approve or disapprove
within five (5) business days after Landlord receives the revised Working
Drawings. In the event that Landlord fails to approve or disapprove the Working
Drawings within such five (5) business day period, Tenant may deem the Working
Drawings to be approved by Landlord. This procedure shall be repeated until all
of the Working Drawings are finally approved by Landlord and written approval
has been delivered to and received by Tenant. The Working Drawings so approved
are referred to as the “Final Plans”.

(iii) Tenant shall verify, in the field, the dimensions and conditions as shown
on the relevant portions of the Base Building Plans; Landlord hereby agreeing to
provide Tenant with the copies of said Base Building Plans in Landlord’s
possession. Tenant shall be solely responsible for the same and Landlord shall
have no responsibility in connection therewith.

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(d) No Liability for Approval. Landlord’s review and approval of the Space Plan,
Working Drawings, the Final Plans, or other documents (collectively, the
“Construction Drawings”) shall be for its sole purpose and not constitute any
representation or warranty by or on behalf of Landlord as to the adequacy,
efficiency, suitability, fitness or desirability of any space layout or
improvements or otherwise constitute assumption by Landlord of any
responsibility for the accuracy or sufficiency thereof, or to be interpreted as
a statement of compliance with code requirements. Accordingly, notwithstanding
that any Construction Drawings are reviewed by Landlord or its space planner,
architect, engineers and consultants, and notwithstanding any advice or
assistance which may be rendered to Tenant by Landlord or Landlord’s space
planner, architect, engineers, and consultants, Landlord shall have no liability
whatsoever in connection therewith and shall not be responsible for any
omissions or errors contained in the Construction Drawings. Landlord shall have
the right to retain and use without charge a copy of the Construction
Drawings,including, without limitation any CAD files relating thereto.

3. Contractor. Tenant shall select a contractor (“Contractor”) subject to the
approval of Landlord, which approval shall not be unreasonably withheld or
delayed. Tenant may have Landlord approve three (3) or more contractors prior to
competitive bidding. Work involving sprinkler, plumbing, mechanical, electrical
power, lighting or fire safety systems of the Building shall be performed only
by subcontractors approved by Landlord, which approval shall not be unreasonably
withheld, conditioned or delayed and all telecommunications and other special
electrical equipment shall be coordinated through Landlord’s electrical
subcontractor. All work shall be performed by union contractors and
subcontractors. The construction contract shall provide for progress payments,
and Tenant shall pay for the entire cost of the Tenant Improvements in excess of
the Tenant Improvement Allowance (as defined in Section 5(b) below). Prior to
commencement of construction of the Tenant Improvements, the Contractor shall
obtain and deliver to Landlord a payment and performance bond with respect to
the work to be performed in connection with the Tenant Improvements from a
bonding company and in form reasonably acceptable to Landlord and in an amount
equal to the estimated cost of the Tenant Improvements. Landlord shall pay the
cost of such bond up to an amount equal to two percent (2%) of the construction
cost and Tenant shall pay any excess.

4. Tenant Improvements. The term “Tenant Improvements” shall mean all
improvements shown in the Final Plans. The Tenant Improvements shall be
constructed in accordance with the Final Plans. No material changes shall be
made to the Final Plans

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without the prior approval of Landlord in accordance with paragraph 6 below.
Tenant and Tenant’s contractors shall abide by all reasonable safety rules and
regulations of Landlord and all work and deliveries shall be scheduled in a
manner so as to avoid any material interference with the use by other tenants of
the Building. Subject to the terms and provisions of the Lease, all Tenant’s
materials, work, installations and decorations of any nature brought upon or
installed in the Premises before the Commencement Date shall be at Tenant’s
risk, and neither Landlord nor any party acting on Landlord’s behalf shall be
responsible for any damage thereto or loss or destruction thereof except to the
extent arising from the gross negligence or willful misconduct of Landlord or
any party acting on Landlord’s behalf. All Tenant Improvements, except
unattached movable business and trade fixtures, furniture and equipment shall
become the property of Landlord and shall remain upon and be surrendered with
the Premises. Except as provided in paragraph 5 below, all cost of construction
shall be borne by Tenant.

5. Tenant Improvement Allowance.

(a) Amount. Landlord will pay to Tenant an amount equal to One Hundred Fifty
Seven Thousand Nine Hundred Sixty Dollars ($157,960) (“Tenant Improvement
Allowance”) expendable for the costs of the construction and design of the
Tenant Improvements, including, without limitation, any amount paid to Tenant’s
Contractor, project coordinator, construction consultant or similar consultant,
Designer or other professional and any out of pocket amounts paid for obtaining
permits (collectively, the “Tenant Improvement Costs”). No portion of the Tenant
Improvement Allowance may be used for the following: (i) furnishings and/or
trade fixtures that are removable by Tenant upon the expiration of the term of
the Lease; (ii) special signage; or (iii) telephone, internet or other
telecommunication cabling, all of which Tenant shall remove prior to the
expiration of the term of the Lease. Any portion of the Tenant Improvement
Allowance which Tenant has not requested from Landlord prior to March 31, 2013
(provided that for each day beyond August 1, 2012 that Landlord fails to deliver
the Premises to Tenant in accordance with the requirements of Section 3.2 of the
Lease, such March 31, 2013 date shall be extended for one day) that Landlord
disburse pursuant to Section 2(b) shall revert to Landlord and shall not be
payable to or on behalf of Tenant.

(b) Disbursement. Prior to commencement of construction, Tenant shall submit an
estimate of the cost of all of the Tenant Improvements, including a copy of the
contractor’s bid. Landlord shall pay to Tenant the Tenant Improvement Allowance
in installments equal to its pro rata share of the amount of the contractor’s
invoice as construction progresses and after Landlord’s inspection and
verification that the work to be paid for has been completed substantially in
accordance with the

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Final Plans. Landlord’s inspection shall be undertaken by the Building
architect, Huntsman and Associates, at Landlord’s expense and shall be
undertaken with a frequency such that Landlord can disburse timely the Tenant
Improvement Allowance. Landlord’s pro rata share shall be a fraction, the
numerator of which is the amount of the Tenant Improvement Allowance and the
denominator of which is the total cost of the Tenant Improvements. Tenant shall
provide evidence satisfactory to Landlord prior to or concurrently with
Landlord’s disbursement that (i) Tenant is contemporaneously paying its share of
the invoice; and Tenant has obtained with respect to the portion of the work for
which payment is requested appropriate mechanic’s lien releases from the
contractor and all subcontractors being paid more than $10,000; provided,
however, Tenant shall have the right to reasonably contest the accuracy or
legitimacy of said bills, invoices and statements by refusing to make payment
when in good faith it determines that payment is not due in whole or in part. In
the event that Tenant does dispute or contest such bills, it shall, promptly
upon the written request of Landlord, record at Tenant’s sole cost and expense a
Mechanic’s Lien Release Bond to free the premises from the applicable mechanic’s
lien to the extent filed. The Tenant Improvement Allowance shall be disbursed by
Landlord every four (4) weeks pursuant to requests for disbursement by Tenant.
In the event that there remain undisbursed portions of the Tenant Improvement
Allowance after Tenant’s delivery to Landlord of the final contractor invoice,
Landlord shall disburse to Tenant within ten (10) days of Tenant’s request such
remaining undisbursed portion of the Tenant Improvement Allowance to the extent
such disbursement does not exceed the aggregate of Tenant’s pro rata share of
the costs of the Tenant Improvements. Tenant may, at any time following the
execution of this Agreement, submit to Landlord no more frequently than monthly
an invoice(s) for the design costs of the Tenant Improvements (the “Design
Costs”). Landlord shall pay from the Tenant Improvement Allowance the amount of
such Design Costs and any such payments shall reduce the amount of the Tenant
Improvement Allowance available to pay the costs of construction.

6. Change Orders. In the event that Tenant requests any changes to the Final
Plans, Landlord shall not unreasonably withhold its consent to any such changes,
and shall grant its consent to such changes within five (5) business days after
Landlord’s receipt of same or designate by notice given within such time period
to Tenant the specific changes disapproved. In the event that Landlord fails to
approve or disapprove any such change within such five (5) business day period,
Tenant may deem any such change to be approved by Landlord.

7. No Fee to Landlord. Landlord shall receive no fee for supervision,
administration, profit, overhead or general conditions in connection with the
Tenant Improvements.

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8. Default and Remedies. Failure by Tenant to perform any obligations on
Tenant’s part to be performed in accordance with the provisions of this
Agreement shall constitute an event of default under this Agreement and under
the Lease following the expiration of applicable notice and cure periods as
provided in the Lease.

9. Compliance with Laws. Tenant acknowledges that the Building is an historical
building and that consequently laws may be applied to the Building differently
than a non-historical building. Tenant assumes all risks of increased design or
construction costs, or increased costs relating to obtaining permits and
approvals, as a result thereof.

IN WITNESS WHEREOF, the parties have entered into this Agreement as of the date
first written above.

 

   LANDLORD:    

/s/ Edward J. Conner

      EDWARD J. CONNER    TENANT:     CONSTANT CONTACT, INC.,       a Delaware
corporation       By:  

/s/ Robert P. Nault

      Its:  

Vice President & General Counsel