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Build to Suit Option Agreement - Martin/Campus Associates LP and At Home Corp.

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BUILD TO SUIT OPTION AGREEMENT

 
         THIS BUILD TO SUIT OPTION AGREEMENT ("Agreement") is made and entered into
as of this 25th day of October, 1996, by and between MARTIN/CAMPUS ASSOCIATES, L.P.,
a Delaware limited partnership ("Owner"), and AT HOME  CORPORATION, a Delaware corporation
("AtHome").
 
                                 R E C I T A L S
 
         This Agreement is made and entered into with reference to and upon the
basis of the following facts, intentions and understandings of the parties:
 
         A.      Owner is the owner of (a) that certain real property situated in
the City of Redwood City, County of San Mateo, State of California, which is described
on Exhibit A hereto (the "North Expansion Parcel"); provided, however, that Owner
holds an unconditional option to purchase, but does not own, the so-called "Sears
Parcel," as further described on Exhibit A-1 hereto (the "Sears Parcel"); and (b)
that certain unimproved real property situated in the City of Redwood City, County
of San Mateo, State of California, which is described on Exhibit B hereto (the "South
Expansion Parcel"). The North Expansion Parcel and the South Expansion Parcel shall
be hereinafter from time to time collectively referred to as the "Property".
 
         B.      Owner and AtHome have entered into that certain Lease dated as
of October 18, 1996 (the "Broadway Lease") pursuant to which Owner is leasing to
AtHome, and AtHome is leasing from Owner, that certain real property commonly known
as 425 Broadway, situated in the City of Redwood City, County of San Mateo, State
of California (the "Broadway Premises").
 
         C.      As part of the consideration for the Broadway Lease, Owner desires
to give to AtHome, and AtHome desires to obtain from Owner, the option to lease
all or certain portions of the conditions, and the option to acquire a portion of
the Property on certain agreed terms and conditions.
 
         D.      Owner and AtHome now desire to enter into this Agreement to set
forth their agreement with respect to the above-described options and rights to
make a first offer.
 
         E.      All capitalized terms no specifically defined in this Agreement
shall have the same meanings given to them in the Broadway Lease.

 
 
                                        1    2
         NOW, THEREFORE, in consideration of the payment by AtHome to Owner of the
sum of One Hundred Dollars ($100) and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged by Owner, Owner and AtHome
hereby agree as follows:
 
         1. Term. The term of this Agreement shall commence upon the execution 
of this Agreement by Owner and AtHome, and shall expire upon the expiration or 
earlier termination of this Agreement in accordance with the terms set forth  below;
provided, however, that if the First Option is not validly and timely  exercised
in accordance with the provisions of Paragraph 2.5, then the First  Option, the
Second Option, and the Third Option (all as defined below), and the  option to purchase
the Second Option Subparcel, shall immediately expire (if  this Agreement has not
already expired or been terminated) on the First Option  Notice Date (as defined
below), and this Agreement shall automatically  terminate as of the First Option
Notice Date; if the Second Option is not  validly and timely exercised in accordance
with the provisions of Paragraph  2.6, then the Second Option and the Third Option,
and the option to purchase  the Second Option Subparcel, shall immediately expire
(if this Agreement has  not already expired or been terminated) on the Second Option
Notice Date (as  defined below); and if the Third Option is not validly and timely
exercised in  accordance with the provisions of Paragraph 2.7, then the Third Option
shall  immediately expire (if this Agreement has not already expired or been  terminated)
on the Third Option Notice Date (as defined below); and provided  further, that
if the owner of the Sears Parcel defaults under the option  agreement with Owner
for the Sears Parcel, this Agreement shall terminate with  respect to the Sears
Parcel. Notwithstanding the foregoing, if the owner of the  Sears Parcel defaults
under the option agreement with Owner for the Sears  Parcel, and Owner nevertheless
obtains title to the Sears Parcel, then so long  as Owner and AtHome agree that
it is feasible to do so, this agreement shall  again apply to the Sears Parcel,
with the same force and effect as if the  Sears Parcel had always been part of the
North Expansion Parcel; provided  however, that the foregoing shall not be interpreted
to require Owner to take  any action to enforce the option agreement for the Sears
Parcel, including  without limitation commencing an action for specific performance
of the option  agreement.
 
                 1.1 Other Documents. Upon expiration of the term of this  Agreement
with respect to any portion of the Property, or upon the expiration  of the First
Option, the Second Option, or the Third Option, AtHome shall  execute, acknowledge
and deliver to Owner an appropriate instrument prepared by  Owner which Owner may
then record in the Official Records of San Mateo County  to expunge this Agreement
and any memorandum thereof from the public record  with respect to such portion
of the Property. In addition, AtHome hereby  irrevocably constitutes and appoints
Owner as its true and lawful attorney in  fact, in its name and in its behalf, to
make, execute, acknowledge, deliver,  and file any 
 
                                        2    3 and all such instruments that AtHome
so fails or refuses to execute. AtHome  expressly understands and acknowledges that
the foregoing special power of  attorney is coupled with an interest, is irrevocable,
and shall survive the  dissolution or insolvency of AtHome, or the transfer by AtHome
of the whole or  any portion of its interest in this Agreement (provided that any
such transfer  shall be subject to the restrictions set forth in this Agreement).
 
         2.      AtHome's Options. AtHome shall have the option to lease certain
 property located in the Project on a build-to-suit basis (each, a "Build to  Suit
Option", and collectively, the "Build to Suit Options") on the terms and  conditions
described in this Agreement.
 
                 2.1.    Option Deposit. AtHome shall, upon the execution of  this
Agreement by Owner and AtHome, deposit with Owner the sum of Five Hundred  Thousand
Dollars ($500,000.00) (the "Option Deposit"), as both consideration  for Owner's
willingness to grant the Build to Suit Options, and as security for  AtHome performance
of its obligations under the Build to Suit Options. As and  when AtHome validly
and timely exercises any of the Build to Suit Options in  accordance with the provisions
of this Agreement, Owner shall refund to AtHome  that portion of the Option Deposit
that equals Five Hundred Thousand Dollars  ($500,000.00) multiplied by a fraction,
the numerator of which shall be the  amount of square feet of Rentable Area to be
located in the Proposed Building  (as defined below) that is the subject of the
Build to Suit Option then being  exercised, and the denominator of which shall equal
Four Hundred Ten Thousand  (410,000); provided, however, that in no event shall
AtHome be entitled to  receive a refund in excess of the total remaining amount
of the Option Deposit  then being held by Owner; provided further, that if the total
aggregate amount  of Rentable Area approved by the City of Redwood City for the
First Option  Building, the Second Option Building and the Third Option Building
(as those  terms are defined below) is less than Four Hundred Ten Thousand (410,000)
 square feet, the denominator of such fraction shall equal the greater of (a)  the
total aggregate amount of Rentable Area approved by the City of Redwood  City for
the First Option Building, the Second Option Building and the Third  Option Building,
or (b) Three Hundred Eighty-Five Thousand (385,000) square  feet. Notwithstanding
anything to the contrary set forth above, in no event  shall Owner be required to
refund more than Five Hundred Thousand Dollars  ($500,000.00) to Tenant pursuant
to this Paragraph 2. If AtHome fails to  exercise any Build to Suit Option in accordance
with the provisions of this  Paragraph 2, or if any Build to Suit Option terminates
as set forth in this  Paragraph 2, then (i) AtHome shall immediately reimburse Owner
for any and all  costs, expenses and fees incurred by Owner to third parties in
the process of  carrying out any and all actions described or permitted under this
Paragraph 2  (including without limitation causing Architect to work on the conceptual
 plans, the Preliminary Plans and/or the Final Plans
 
                                        3    4 (as those terms are defined below)),
so long as such costs, expenses and fees  have been approved as part of the budgeting
process described in Paragraph  2.1.1, and (ii) the entire remaining balance of
the Option Deposit shall  immediately become the property of Owner, and AtHome shall
have no further  right, title, claim, or interest in or to any portion of the Option
Deposit.  Owner shall not be required to segregate the Option Deposit from Owner's
 general funds; Owner's obligations with respect to the Option Deposit shall be
 those of a debtor and not a trustee, and AtHome shall not be entitled to any  interest
on the Option Deposit.
 
                   2.1.1. Approval of Budget. From time to time during the design
and planning process for the Proposed Buildings described in this Paragraph 2, Owner
shall present to AtHome a budget (each, a "Budget") showing in reasonable detail
the upcoming actions Owner intends to undertake pursuant to this Paragraph 2, and
the amount of costs, expenses and fees Owner estimates it will incur to third parties
in the course of carrying out such actions. AtHome shall have ten (10) days after
its receipt of any such Budget to review and approve the same, provided that its
approval of any such Budget shall not be unreasonably withheld. If AtHome disapproves
any matter or line item contained in such Budget, then Owner may at its election
either submit a revised Budget for AtHome's review and approval (in which event
AtHome and Owner shall continue to follow the procedures set forth in this Paragraph
2.1.2), or proceed with the actions described in the originally submitted Budget
without obtaining AtHome's approval thereof. If AtHome neither approves nor disapproves
the Budget within such 10-day period, AtHome shall be deemed to have approved such
Budget as submitted. 
 
                   2.2. Architect. Within a reasonable period of time after the
execution of this Agreement, Owner shall notify AtHome in writing of the name and
address of the licensed architect whom Owner desires to engage for the preparation
of conceptual designs for the Expansion Project (as defined below). Owner's architect
("Architect") shall be subject to AtHome's prior written approval, which approval
shall not be unreasonably withheld or delayed. Owner shall not replace the Architect
without obtaining AtHome's prior written approval, which approval shall not be unreasonably
withheld or delayed. For the purposes of this Agreement, the term "Expansion Project"
shall mean the Proposed Buildings consisting of approximately Four Hundred Ten Thousand
(410,000) square feet of Rentable Area that Owner may develop for AtHome on the
North Expansion Parcel and the South Expansion Parcel under the Build to Suit Options;
and the term "Proposed Building" shall mean the building or buildings to be constructed
pursuant to any Build to Suit Option.
 
                   2.2.1. Initial Design Process. Commencing between January 1,
 1997 and March 31, 1997, Owner and AtHome shall work with Architect to develop
 conceptual designs for the Expansion Project consistent with those certain  plans
prepared by 
 
                                        4    5

  Ken Rodriguez, copies of which are attached hereto as Exhibit F (the "Basic Site
Plans"). The conceptual designs shall set forth, without limitation, the size, elevations,
locations, and proposed phasing for the development of the Proposed Buildings to
be included in the Expansion Project; schematic plans for the Proposed Buildings;
and design development information sufficient to enable the parties to obtain preliminary
pricing from Contractor (as defined below) for the construction of the Proposed
Building. The parties acknowledge and agree that the size and location of the Proposed
Building to be constructed under each of the Build to Suit Options, and the proposed
phasing for the development of the Proposed Buildings, is of critical importance
under this Agreement, and AtHome agrees to provide the proposed size ad location
of such Proposed Building, and the proposed phasing for the development of the Proposed
Buildings, as early in the process described in this Paragraph 2.2.1 as shall be
feasibly possible. The size of each Proposed Building shall be subject to the minimum
sizes set forth in Paragraphs 2.5, 2.6 and 2.7; the size and location of each Proposed
Building shall be subject to the reasonable approval of Owner; and the phasing for
the development of the Proposed Buildings shall be subject to the approval of Owner,
which may be withheld in Owner's sole discretion. Owner shall have no right to disapprove
the size or location of any Proposed Building to the extent that the size or location
proposed by AtHome is consistent with the Basic Site Plans. Each Proposed Building
shall at a minimum be designed to the following standard (the "Minimum Building
Standard"): a multi-story steel-framed structure suitable for office use, with a
glass and drivet exterior. For the purposes of this Agreement, the "phasing" for
the development of the Proposed Buildings shall mean the timing for the development
of the First Option Building, the Second Option Building, and the Third Option Building,
and the areas within the Property where the First Option Building, the Second Option
Building, and the Third Option Building shall be located; and the "location" of
a Proposed Building shall mean the placement and alignment of the footprint of such
Proposed Building within the building area described in the phasing for the development
of the Proposed Buildings.
 
                       2.2.2.   Conceptual Designs. Based on the information provided
by AtHome as described above, Owner shall cause Architect to prepare conceptual
designs for the Expansion Project consistent with the Basic Site Plans, and shall
provide AtHome with copies of and the opportunity to comment upon, all drafts of
such conceptual designs. To the extent that AtHome offers specific written comments
to any such designs, and such comments are reasonably acceptable to Owner, Owner
shall use reasonable efforts to cause Architect to consider such comments and/or
incorporate such comments into a revised draft of such designs. The collaborative
process described in this Paragraph 2.2 shall continue until the first to occur
of (a) August 31, 1997, or (b) such time as Owner and AtHome reach agreement upon
the conceptual designs for the Expansion Project. However, if

 
                                        5    6 Owner and AtHome fail to agree upon
such conceptual designs by August 31, 1997,  then Owner shall cause Architect to
prepare and submit to AtHome on or before  September 30, 1997, and AtHome shall
be deemed to have approved, a conceptual  design ("Landlord's Conceptual Design")
for the Expansion Project consistent  with the Basic Site Plans that calls for each
of the Proposed Buildings to be  constructed to the Minimum Building Standard. Landlord's
Conceptual Design  shall reflect Owner's reasonable determination of the size and
location of the  Proposed Buildings (so long as such size and location is consistent
with the  Basic Site Plans), and the schematic plans and design development information
 for the Proposed Buildings, all taking into consideration the standards set  forth
in this Agreement and the information and requests submitted by Tenant.  The conceptual
designs for the Proposed Buildings prepared pursuant to this  Paragraph 2.2.2, whether
agreed upon by Owner and AtHome, or prepared as  Landlord's Conceptual Design by
Architect at Owner's request, shall hereafter  be collectively called the "Approved
Conceptual Designs".
 
         2.3.  Build to Suit Notice.  In order to elect to exercise any of the 
Build to Suit Options, AtHome shall deliver to Owner, on or before the  applicable
Option Notice Date (as defined below), a written notice (with each  such notice
being called a "Build to Suit Notice") setting forth AtHome's  exercise of the Build
to Suit Option, and identifying the Proposed Building to  which such Build to Suit
Notice applies, the proposed size and location of the  Proposed Building, and the
proposed phasing for the development of the Proposed  Buildings. The size and location
of the Proposed Building shall be subject to  the reasonable approval of Owner;
and the phasing for the development of the  Proposed Buildings shall be subject
to the approval of Owner, which may be  withheld in Owner's sole discretion. Owner
shall have no right to disapprove  the size or location of any Proposed Building
to the extent that the size or  location proposed by AtHome is consistent with the
Basic Site Plans. The Build  to Suit Notice must be accompanied by (i) two copies
of a Lease identical to  the form of the Lease attached hereto as Exhibit C, executed
by AtHome and with  all blanks filled in with appropriate information satisfactory
to Landlord, and  (ii) AtHome's check payable to Owner in an amount equal to the
aggregate of the  advance payment of monthly rent set forth in the second grammatical
paragraph  of Paragraph 5.A of the Lease, and the security deposit set forth in
Paragraph  6 of the Lease. The parties acknowledge and agree that the process described
in  this Paragraph 2.3 is only intended to apply to the construction of the Shell
 and Core of each Proposed Building (as those terms are defined in Exhibit D  attached
hereto), and that the design and planning of the tenant improvements  for each Proposed
Building will be handled in the manner set forth in the work  letter to be attached
to each respective Lease for a Proposed Building.
 
                 2.3.1.  Preliminary Plans.  Owner shall cause Architect to  prepare
preliminary plans (the "Preliminary Plans")
 
                                        6    7

  for the Proposed Building, based upon the Approved Conceptual Designs. Owner shall
use reasonable efforts to cause Architect to deliver the Preliminary Plans to AtHome
within fifteen (15) days after Owner's receipt of the Build to Suit Notice for such
Proposed Building; provided, however, that Owner may in its sole discretion elect
to cause Architect to commence preparing the Preliminary Plans prior to completion
of the Approved Conceptual Designs. Within five (5) days after AtHome's receipt
of the Preliminary Plans, AtHome shall either approve or disapprove the Preliminary
Plans. If AtHome disapproves the Preliminary Plans, then AtHome shall state in reasonable
detail the changes which AtHome requires to be made thereto. Owner shall use reasonable
efforts to cause Architect to submit to AtHome revised Preliminary Plans within
five (5) days after Owner's receipt of AtHome's disapproval notice. Following AtHome's
receipt of the revised Preliminary Plans from Owner, AtHome shall have the right
to review and approve the revised Preliminary Plans pursuant to this Paragraph 2.3.1.
AtHome shall give Owner written notice of its approval or disapproval of the revised
Preliminary Plans within five (5) days after the date of AtHome's receipt thereof.
If AtHome disapproves the revised Preliminary Plans, then AtHome and Owner shall
continue to follow the procedures set forth in this Paragraph 2.3.1 until either
(a) AtHome and Owner approve the Preliminary Plans in accordance with this Paragraph
2.3.1, or (b) the date that is thirty (30) days after Owner's receipt of the Build
to Suit Notice, whichever shall first occur. If AtHome and Owner do not mutually
agree upon the Preliminary Plans within such 30-day period, then AtHome may, in
its sole discretion, elect by written notice (the "Preliminary Plan Acceptance Notice")
delivered to Owner within three (3) days after AtHome's receipt of written notice
from Owner that such 30-day period has expired (and Owner shall have the right to
deliver such notice to AtHome as early as three (3) days before the expiration of
such 30-day period), to either (i) accept the last version of the Preliminary Plans
submitted by Owner to AtHome pursuant to this Paragraph 2.3.1, or (ii) agree that
Architect shall prepare an initial version of the Final Plans (as defined below)
for the Proposed Building based upon the Minimum Building Standard, and that no
Preliminary Plans are required under this Paragraph 2.3.1. If AtHome and Owner do
not mutually agree upon the Preliminary Plans within the 30-day period described
above, and AtHome does not deliver the Preliminary Plan Acceptance Notice to Owner
within the 3-day period described above, then such Build to Suit Option and all
unexercised Build to Suit Options shall terminate and cease to be of any force or
effect, effective upon the expiration of such 30-day period. If AtHome neither approves
nor disapproves the Preliminary Plans or the revised Preliminary Plans within the
applicable time periods provided above, AtHome shall be deemed to have disapproved
such Preliminary Plans as submitted.
 
         2.3.2.  Final Plans.    Owner shall use reasonable efforts to cause Architect
to deliver to AtHome, within ten (10) days after approval by AtHome and Owner of
the

 
 
                                        7    8 Preliminary Plans, complete plans
and specifications which incorporate and are consistent with the approved Preliminary
Plans, and which show in detail the intended design, construction and finishing
of all portions of the Proposed Building (the "Final Plans"). Within five (5) days
after AtHome's receipt of the Final Plans, AtHome shall either approve or disapprove
the Final Plans. If AtHome disapproves the Final Plans, then AtHome shall state
in reasonable detail the changes which AtHome requires to be made thereto. Owner
shall use reasonable efforts to cause Architect to submit to AtHome revised Final
Plans within five (5) days after Owner's receipt of AtHome's disapproval notice.
Following AtHome's receipt of the revised Final Plans from Owner, AtHome shall have
the right to review and approve the revised Final Plans pursuant to this Paragraph
2.3.2. AtHome shall give Owner written notice of its approval or disapproval of
the revised Final Plans within five (5) days after the date of AtHome's receipt
thereof. If AtHome disapproves the revised Final Plans, then AtHome and Owner shall
continue to follow the procedures set forth in this Paragraph 2.3.2 until either
(a) AtHome and Owner approve such Final Plans in accordance with this Paragraph
2.3.2, or (b) the date that is sixty (60) days after Owner's receipt of the Build
to Suit Notice. If AtHome and Owner do not mutually agree upon the Final Plans within
such 60-day period, then AtHome may, in its sole discretion, elect by written notice
(the "Final Plan Acceptance Notice") delivered to Owner within three (3) days after
AtHome's receipt of written notice from Owner that such 60-day period has expired
(and Owner shall have the right to deliver such notice to AtHome as early as three
(3) days before the expiration of such 60-day period), to either (i) accept the
last version of the Final Plans submitted by Owner to AtHome pursuant to this Paragraph
2.3.2, or (ii) agree that Owner may proceed with the construction of the Proposed
Building by utilizing plans and specifications to be prepared by Architect based
upon the Minimum Building Standard, that AtHome shall have no right to approve or
reject such plans and specifications, and that such plans and specifications shall
be deemed to constitute the "Final Plans" for the purposes of this Agreement. If
AtHome and Owner do not mutually agree upon the Final Plans within the 60-day period
described above, and AtHome does not deliver the Final Plan Acceptance Notice to
Owner within the 3-day period described above, then such Build to Suit Option and
all unexercised Build to Suit Options shall terminate and cease to be of any force
or effect, effective upon the expiration of such 60-day period. If AtHome neither
approves nor disapproves the Final Plans within the applicable time periods provided
above, AtHome shall be deemed to have disapproved the Final Plans as submitted.
 
                         2.3.3   Construction Budget. Owner intends to retain  Devcon
Construction ("Contractor" as the general contractor for the  construction of the
Proposed Buildings. AtHome shall have the right to approve  the construction contract
between Owner and Contractor for the construction of  any Proposed Building, which
approval shall not be unreasonably withheld or  delayed; provided, however, that
AtHome shall have no right to
 
                                        8    9 disapprove such construction contract
if such construction contract conforms in  all material respects with the applicable
AIA form contract and general  conditions. Owner shall have the right to replace
the Contractor at any time,  provided that any other contractor proposed by Owner
shall not be designated as  the "Contractor" under this Agreement without AtHome's
prior written approval,  which approval shall not be unreasonably withheld or delayed.
Upon approval by  Owner and AtHome of the Final Plans, Owner shall instruct Contractor
to obtain  competitive bids for the Proposed Building from at least three (3) qualified
 subcontractors for each of the major subtrades (excluding the mechanical and  electrical
trades, which shall be on a design/build basis; provided, however,  that Owner shall
review the proposed costs of such design/build mechanical and  electrical work,
and use reasonable efforts to keep the overall costs of such  design/build mechanical
and electrical work at commercially reasonable levels),  and to submit the same
to Owner and AtHome for their review and approval. Upon  selection of the subcontractors
and approval of the bids, Contractor shall  prepare a cost estimate for the Proposed
Building described in such Final  Plans, based upon the bids submitted by the subcontractors
selected. Contractor  shall submit such cost estimate to Owner and AtHome for their
review and  approval, based upon the terms set forth in Paragraph 2 of Exhibit D
hereto.  Owner and AtHome may reject such cost estimate only if (a) those Development
 Costs (as defined in Exhibit D) described in Paragraph 2.2 of Exhibit D hereto
 exceed the Adjustable Cost Limit (as defined in Exhibit D), or (b) the annual 
rent for the Proposed Building will be less than the minimum return described  in
Paragraph 2.2 of Exhibit D hereto, and AtHome does not agree to increase the  rent
payable under that Build to Suit Lease pursuant to Paragraph 2.3 of  Exhibit D hereto.
If either Owner or AtHome rejects such cost estimate in  accordance with this Paragraph
2.3.3, and Owner and AtHome fail to agree on  revisions to the Final Plans within
ten (10) days after their receipt of the  cost estimate, then such Build to Suit
Option shall terminate and cease to be  of any force or effect in accordance with
Paragraph 2.3 of Exhibit D hereto,  and all unexercised Build to Suit Options shall
also terminate effective upon  the termination of such Build to Suit Option. Following
any submission of  revised Final Plans to Contractor and a resolicitation of bids
by Contractor,  Owner and AtHome shall again follow the procedures set forth in
this Paragraph  2.3.3 with respect to the submission and approval of the cost estimate
from  Contractor until either (i) Owner and AtHome approve such cost estimate in
 accordance with this Paragraph 2.3.3, or (ii) the date that is ninety (90) days
 after Owner's receipt of AtHome's Build to Suit Notice. If Owner and AtHome do
 not mutually agree upon the cost estimate within such 90-day period, and AtHome
 does not agree to increase the rent payable under that Build to Suit Lease  pursuant
to Paragraph 2.3 of Exhibit D hereto, then such Build to Suit Option  and all unexercised
Build to Suit Options shall terminate and cease to be of  any force or effect in
accordance with Paragraph 2.3 of Exhibit D hereto, and  all unexercised Build to
Suit Options shall also terminate 
 
                                        9    10 effective upon the termination of
such Build to Suit Option. If either Owner or AtHome neither approves nor disapproves
the cost estimate within the applicable time periods provided above, such party
shall be deemed to have disapproved the cost estimate as submitted.
 
                 2.3.4.  Construction Financing. If Owner and AtHome have both accepted
Contractor's cost estimate for the Proposed Building pursuant to Paragraph 2.3.3
above, Owner shall have a period of thirty (30) days after such mutual acceptance
of the cost estimate to use reasonable efforts to attempt to obtain a loan for the
costs of constructing the Proposed Building ("Construction Financing"), in an amount
not less than the total amount of estimated Development Costs (as defined in Paragraph
1 of Exhibit D hereto), less the Land Value (as defined in Paragraph 1.1 of Exhibit
D hereto), under such commercially reasonable terms and conditions as shall be reasonably
acceptable to Owner (including, if necessary, a commercially reasonable completion
guaranty provided by Owner); provided, however, that in no event shall Owner be
required to provide any other form of credit enhancement or any third party guaranty
as security for such Construction Financing, including without limitation any guaranty
from the partners or members of Owner. If Owner is unable to obtain Construction
Financing under such commercially reasonable terms, Owner may, by giving written
notice to AtHome within such 30-day period, elect to terminate its obligation to
construct such Proposed Building, in which event such Build to Suit Option and all
unexercised Build to Suit Options shall terminate and cease to be of any force or
effect, effective upon the expiration of such 30-day period; provided, however,
that if within such 30-day period AtHome delivers written notice to Owner whereby
AtHome covenants and agrees to provide the "AtHome Loan" (as defined below) to Owner
to finance the cost of constructing the Proposed Building, and AtHome funds the
AtHome Loan in accordance with the following terms and conditions, then such Build
to Suit Option and all unexercised Build to Suit Options shall remain in full force
and effect. The AtHome Loan shall be interest-free; in an amount not less than the
total amount of estimated Development Costs less the Land Value; and for a term,
with a funding schedule, and on such other terms and conditions as shall be commercially
reasonable, as reasonably determined by Owner (including, if necessary, a commercially
reasonable completion guaranty provided by Owner); provided, however, that in no
event shall Owner be required to provide any other form of credit enhancement or
any third party guaranty as security for the AtHome Loan. The AtHome Loan shall
be evidenced by such commercially reasonable loan documents as shall be mutually
acceptable to Owner and AtHome.
 
                 2.4.    Agreement as to Terms. Should the parties reach agreement
on the location and design of the Proposed Building and the cost and schedule for
the construction of the Proposed Building within the applicable time periods described
in this Paragraph 2, such agreement shall be evidenced by a written 

 
                                        10    11

  lease agreement (each, a "Build to Suit Lease") in substantially the form of the
Lease attached hereto as Exhibit C, but containing (a) the terms and conditions
to which Owner and AtHome have specifically agreed pursuant to this Paragraph 2
(the "Specific Terms"), and (b) the terms and conditions set forth on Exhibit D
attached to this Agreement (the "General Terms"). To the extent there is any discrepancy
between the Specific Terms and the General Terms, the Specific Terms shall be controlling.
 
                2.5.    First Option. AtHome shall have until September 30, 1997
(the "First Option Notice Date") to deliver to Owner AtHome's first Build to Suit
Notice (the "First Option"); provided, however, that AtHome shall not be entitled
to exercise the First Option unless and until AtHome has either (a) both (i) raised
at least Thirty-Five Million Dollars ($35,000,000.00) in additional equity funds
(over and above those equity funds raised by AtHome on or prior to the date the
Broadway Lease is executed by Owner and AtHome), and (ii) demonstrated to Owner's
reasonable satisfaction that AtHome's assets include currently available funds equal
to least Thirty-Five Million Dollars ($35,000,000.00), or (b) completed an initial
public offering of its common stock on a national stock exchange or on an over-the-counter
basis. The failure of AtHome so to exercise the First Option on or before the First
Option Notice Date shall terminate AtHome's rights to exercise the First Option
and all other Build to Suit Options. If AtHome validly and timely exercises that
First Option in accordance with this Paragraph 2.5, the Second Option and the Third
Option shall remain in full force and effect. The Proposed Building(s) under the
First Option (which may be made up of two separate buildings) (collectively, the
"First Option Building") shall contain a minimum Rentable Area of not less than
One Hundred Fifty Thousand square feet (150,000); provided, however, that if at
the time AtHome exercises the First Option, AtHome has previously exercised its
option to lease the entire building within the Project commonly known as 2945 Bay
Road (the "Bay Road Premises"), the minimum Rentable Area of the First Option Building
would be One Hundred Fifty Thousand (150,000) square feet minus the Rentable Area
of the Bay Road Premises.
 
                2.6.    Second Option. If AtHome exercises the First Option in accordance
with Paragraph 2.5, and Owner and AtHome execute a Build to Suit Lease with respect
to the First Option, then AtHome shall have until March 30, 1998 (the "Second Option
Notice Date") to deliver to Owner AtHome's second Build to Suit Notice (the "Second
Option"); provided, however, that AtHome shall not be entitled to exercise the Second
Option unless and until AtHome has completed an initial public offering of its common
stock on a national stock exchange or on an over-the-counter basis. The failure
of AtHome so to exercise the Second Option on or before the Second Option Notice
Date shall terminate AtHome's rights to exercise the Second Option and the Third
Option, and shall terminate AtHome's right to exercise its option to purchase the
Second Option Subparcel (as defined below) 

 
                                        11    12 pursuant to Paragraph 3. If AtHome
validly and timely exercises the Second  Option in accordance with this Paragraph
2.6, the Third Option shall remain in  full force and effect. The Proposed Building
under the Second Option (which may  be made up of two (2) separate buildings) (collectively,
the "Second Option  Building") shall contain a minimum Rentable Area of not less
than One Hundred  Fifty Thousand (150,000) square feet; provided, however, that
if at the time  AtHome exercises the Second Option, AtHome has previously leased
the Bay Road  Premises and the First Option Building, the minimum Rentable Area
of the Second  Option Building would be reduced by the extent to which (a) the sum
of the  Rentable Area of the Bay Road Premises, and the Rentable Area of the First
 Option Building, exceeds (b) One Hundred Fifty Thousand (150,000) square feet.
 
                 2.7.  Third Option.  If AtHome exercises the First Option and 
the Second Option in accordance with Paragraphs 2.5 and 2.6, and Owner and  AtHome
have executed Build to Suit Leases with respect to the First Option and  the Second
Option, then AtHome shall have until December 31, 1998 (the "Third  Option Notice
Date") to deliver to Owner the third Build to Suit Notice (the  "Third Option").
The failure of AtHome so to exercise the Third Option on or  before the Third Option
Notice Date shall terminate AtHome's right to exercise  the Third Option. The failure
of AtHome so to exercise the Third Option on or  before the Third Option Notice
Date shall terminate AtHome's rights to exercise  the Third Option. The Proposed
Building under the Third Option (the "Third  Option Building") shall consist of
the entire amount of remaining entitled  office space situated in the South Expansion
Parcel, and the North Expansion  Parcel. The First Option Notice Date, the Second
Option Notice Date, and the  Third Option Notice Date shall be collectively called
the "Option Notice Dates".
 
                 2.8.  Conditions to Exercise.  The effectiveness of AtHome's  right
to exercise the Build to Suit Options, as set forth in this Paragraph 2,  is in
each instance conditioned on the following: (a) AtHome has not previously  entered
into a Sublet of any Build to Suit Lease or the Broadway Lease (other  than a Permitted
Transfer); and (b) no monetary or other default by AtHome  exists under the Broadway
Lease which remains uncured after the giving of any  applicable notice and the expiration
of any applicable cure period. In  addition, if any of the conditions specified
under clauses (a) or (b) above do  not continue to be satisfied as of the date on
which the Build to Suit Lease is  to commence, then unless Owner waives in writing
any of such conditions,  AtHome's exercise of the Build to Suit Option under this
Paragraph 2 shall be  null and void, and this Agreement and the Build to Suit Lease
shall terminate  effective as of the date on which the Build to Suit Lease was to
commence.
 
                                        12    13
         3. Option to Purchase.
 
                 3.1 Option to Purchase Second Option Subparcel. Owner shall use
reasonable efforts to subdivide the property on which the Second Option Building
is to be situated so that one of the buildings comprising the Second Option Building
becomes situated on one or more legal parcels (which parcel or parcels, together
with all rights and appurtenances thereto, are collectively called the "Second Option
Subparcel"), separate and apart from any other areas of the Project and the North
Expansion Parcel. If Owner so creates the Second Option Subparcel in a configuration
acceptable to Owner, then upon AtHome's exercise of the Second Option in accordance
with the requirements set forth in Paragraph 2.3 above, AtHome shall have the option
to (in lieu of requiring Owner to develop the Second Option Building to be situated
on the Second Option Subparcel) acquire, on an all cash basis, in the manner set
forth in Paragraph 3.2, fee title to the Second Option Subparcel, so long as the
Second Option Subparcel is, in Owner's judgment, of sufficient size and has been
granted sufficient entitlements to develop a building containing at least Seventy-Five
Thousand (75,000) square feet of Rentable Area. The purchase price for the Second
Option Subparcel shall be equal to the product of Sixty-Five and 25/100ths Dollars
($65.25) multiplied by the total amount of square feet of Rentable Area approved
by the City of Redwood City for the Second Option Building to be constructed on
the Second Option Subparcel, but in no event shall the purchase price be less than
Four Million Eight Hundred Ninety-Three Thousand Seven Hundred Fifty Dollars ($4,893,750.00).
In order to elect to exercise its option to acquire the Second Option Subparcel,
AtHome shall deliver to Owner, concurrently with its delivery to Owner of AtHome's
notice exercising the Second Option, a written notice setting forth AtHome's exercise
of its option to acquire the Second Option Subparcel (the "Second Option Subparcel
Notice"). The Second Option Subparcel Notice shall not be effective unless it includes
the following: (i) immediately available funds in an amount equal to five percent
(5%) of the purchase price for the Second Option Subparcel (the "Deposit"), and
(ii) AtHome's execution of the liquidated damage provision set forth in Exhibit
E attached to this Agreement. The Deposit shall be held by the Title Company, defined
in Exhibit E, in an interest bearing account and shall constitute liquidated damages,
and shall be paid to Owner in the event AtHome fails to consummate the purchase
of the Second Option subparcel in accordance with the terms of this Paragraph 3,
other than as a direct result of Owner's failure to perform its obligations under
this Paragraph 3 or Exhibit E. Escrow for the sale of the Second Option Subparcel
to AtHome shall close thirty (30) days after Owner's receipt of the Second Option
Subparcel Notice, or such other date as Owner and AtHome shall mutually agree. AtHome's
acquisition of the Second Option Subparcel shall be subject to the provisions of
Paragraphs 3.2. If AtHome does not deliver the Second Option Subparcel Notice to
Owner as described above, then AtHome's option to purchase the Second Option Subparcel
shall terminate and cease to be of any
 
                                        13    14 force or effect as of the Second
Option Notice Date. All closing, title  insurance and transfer costs, including
without limitation applicable sales and  transfer taxes, associated with AtHome's
acquisition of the Second Option  Subparcel shall be paid by Owner and AtHome in
accordance with the custom in  San Mateo County.
 
                         3.1.1.  Effect of Exercise. Notwithstanding anything to
 the contrary set forth in Paragraph 3.1 above, AtHome's exercise of its option
 to acquire the Second Option Subparcel pursuant to Paragraph 3.1 shall have no
 affect upon AtHome's right and obligation to lease the balance of the Second  Option
Building in accordance with the terms and conditions set forth in  Paragraph 2;
provided, however, that such terms and conditions shall be  equitably adjusted as
may be reasonably necessary in order to account for the  fact that AtHome is purchasing
rather than leasing the Second Option Subparcel.
 
                 3.2     Conditions. The effectiveness of AtHome's option to  acquire
the Second Option Subparcel, as set forth in this Paragraph 3, is  conditioned on
the following: (a) AtHome has not previously entered into a  Sublet of any Build
to Suit Lease or the Broadway Lease that requires Owner's  consent; and (b) no monetary
or other material default by AtHome exists under  either any Build to Suit Lease
or the Broadway Lease which remains uncured  after the giving of any applicable
notice and the expiration of any applicable  cure period. In addition, if any of
the conditions specified under clauses (a)  or (b) above do not continue to be satisfied
as of the date on which the escrow  for the sale of the Second Option Subparcel
to AtHome is scheduled to close,  then unless Owner waives in writing any such conditions,
AtHome's exercise of  its right to acquire the Second Option Subparcel under this
Paragraph 3 shall  be null and void, and this Agreement shall terminate effective
as of the date  on which the escrow for the sale of the Second Option Subparcel
to AtHome was  scheduled to close.
 
                 3.3     Process. Should AtHome exercise its option to acquire 
the Second Option Subparcel within the applicable period of time set forth in  this
Paragraph 3, AtHome's acquisition of the Second Option Subparcel shall be  carried
out on (a) the terms and conditions described in this Paragraph 3 (the  "Agreed
Second Option Subparcel Terms"), and (b) the terms and conditions set  forth on
Exhibit E attached to this Agreement (the "Standard Terms"). To the  extent there
is any discrepancy between the Agreed Terms and the Standard  Terms, the Agreed
Terms shall be controlling.
 
         4.      Rights Personal. The options granted to AtHome under Paragraphs
 2 and 3 shall all be personal to AtHome, and shall not be assigned, sold,  conveyed
or otherwise transferred to any other party (including without  limitation any assignee
or sublessee of such AtHome) without the prior written  consent of Owner, which
consent may be withheld in Owner's sole discretion;
 
                                        14    15 provided, however, that the rights
granted to AtHome under Paragraph 3 without  Owner's consent may be transferred
to the transferee of AtHome's interest in  the Broadway Lease pursuant to a Permitted
Transfer. For the purposes of this  Agreement, the term "AtHome" shall be deemed
to include any such transferee to  whom AtHome has assigned its rights under Paragraph
3. 
 
                   5.  Events Of Default And Remedies Upon Default.
 
                       5.1. Events of Default. The occurrence of any of the  following,
whatever the reason therefor, shall constitute an "Event of Default"  by AtHome
under this Agreement:
 
                       (a) AtHome fails to perform or observe any of its  obligations
under this Agreement; or
                        
                       (b) AtHome fails to cure within any applicable grace  period
any default by AtHome or any of its Affiliates under any other agreement  by and
between Owner (or Owner's successors and assigns) and AtHome, or their  respective
Affiliates, including without limitation each Build to Suit Lease,  the Broadway
Lease, that certain Agreement Granting Right of First Offer of  even date herewith
("First Offer Agreement"), and that certain Option Agreement  (Bay Road) of even
date herewith ("Bay Road Option"), and any and all leases  entered into by and between
Owner and AtHome, or their respective Affiliates,  pursuant to the First Offer Agreement
or the Bay Road Option (collectively, the  "Other Documents").
 
                        5.2. Remedies Upon Default. Upon the occurrence of any Event
of Default, Owner may, at its option terminate this Agreement by delivering written
notice of such termination to AtHome, in which event Owner shall, as of the date
of delivery of such notice, be free to enter into a lease with a third party or
parties for all or any portion of the Property (separately or together with any
other premises) upon any terms whatsoever. The provisions of this Paragraph 5 shall
have no effect upon Owner's ability to exercise any and all of its rights under
the Other Documents.
 
                   6. Brokers. Owner and AtHome acknowledge and agree that  certain
real estate brokers (including without limitation Colliers Parrish  International,
AMB Corporate Real Estate Advisors and BT Commercial) have been  involved in the
Broadway Lease. AtHome warrants and represents that it has had  no dealings with
any other real estate broker or agent in connection with the  negotiation of this
Agreement, and that it knows of no other real estate broker  or agent who is or
might be entitled to a commission in connection with this  Agreement. AtHome shall
indemnify, defend and hold Owner harmless from and  against any and all claims,
causes of action, liability or costs, including  reasonable attorney's fees, arising
as a result of a breach of the foregoing  warranty and representation. Nothing contained
in

 
                                        15    16 this Paragraph 6 shall be deemed
to obligate or require Owner to pay any commission whatsoever to any real estate
broker __________ (including without limitation Colliers Parrish International,
AMB Corporate Real Estate Advisors and BT Commercial) with respect to this Agreement;
the payment of any such commission (if any) shall be governed by a separate written
agreement between Owner and the real estate broker or brokers in question.
 
         7.      Notices. The address of each party for the purpose of all notices
permitted or required by this Agreement is as follows:
 
         To Owner:       Martin/Campus Associates, L.P.
                         100 Bush Street
                         San Francisco, CA 94104
                         Attn: Cathy Greenwold
 
         To AtHome:      At Home Corporation
                         385 Ravendale Drive
                         Mountain View, CA 94043
                         Attn: Ken Goldman
 
         Any notice or demand required or desired to be given under this Agreement
shall be in writing and shall be personally served or in lieu of personal service
may be given by certified mail, facsimile, or overnight courier service. All notices
or demands under this Agreement shall be deemed given, received, made or communicated
on the date personal delivery is effected; or, if sent by certified mail, on the
delivery date or attempted delivery date shown on the return receipt; or, if sent
by facsimile, on the date sent by the sender; or, if sent by overnight courier service,
on the delivery date or attempted delivery date shown on such service's records.
Either party may change its address by giving notice of same in accordance with
this Paragraph 7.
 
         8.      Captions. The captions and headings used in this Agreement are
for the purpose of convenience only and shall not be construed to limit or extend
the meaning of any part of this Agreement.
 
         9.      Executed Copy. Any fully executed copy of this Agreement shall
be deemed an original for all purposes.
 
         10.     Time.   Time is of the essence for the performance of each term,
condition and covenant of this Agreement.
 
         11.     Separability. If one or more of the provisions contained herein,
is for any reason held invalid, illegal or unenforceable in any respect, such invalidity,
illegality, or unenforceability shall not affect any other provision of this Agreement,
but this Agreement shall be construed as if such

 
 
                                        16    17 invalid, illegal or unenforceable
provision had not been contained herein.
 
      12.  Choice of Law. This Agreement and the rights and obligations of the 
parties hereunder shall be construed and enforced in accordance with the laws  of
the State of California as applied to contracts made and entirely performed  therein.
The language in all parts of this Agreement shall in all cases be  construed as
a whole according to its fair meaning and not strictly for or  against either Owner
or AtHome.
 
      13.  Gender; Singular, Plural. When the context of this Agreement  requires,
the neuter gender includes the masculine, the feminine, a partnership  or corporation
or joint venture, and the singular includes the plural.
 
      14.  Binding Effect. The covenants and agreement contained in this  Agreement
shall be binding on, and inure to the benefit of, the parties hereto  and on their
respective successors and assigns to the extent this Agreement is  assignable.
 
      15.  Waiver. The waiver by Owner of any breach of any term, condition or 
covenant, of this Agreement shall not be deemed to be a waiver of such  provision
or any subsequent breach of the same or any other term, condition or  covenant of
this Agreement. No covenant, term or condition of this Agreement  shall be deemed
to have been waived by Owner unless such waiver is in writing  signed by Owner.
This Agreement may be modified only by a written agreement so  specifying, duly
executed by both parties.
 
      16.  Entire Agreement. This Agreement is the entire agreement between the
 parties, and there are no agreements or representations between the parties  except
as expressed herein. Except as otherwise provided herein, no subsequent  change
or addition to this Agreement shall be binding unless in writing and  signed by
the parties hereto.
 
      17.  Authority. If AtHome is a corporation or a partnership, each  individual
executing this Agreement on behalf of said corporation or  partnership, as the case
may be, represents and warrants that he is duly  authorize to execute and deliver
this Agreement on behalf of said entity in  accordance with its corporate bylaws,
statement of partnership or certificate  of limited partnership, as the case may
be, and that this Agreement is binding  upon said entity in accordance with its
terms. Owner, at its option, may  require a copy of such written authorization to
enter into this Agreement.
 
      18.  Attorneys' Fees. If either party brings any action or legal  proceeding
for damages for an alleged breach of any provision of this  Agreement, or to enforce,
protect or establish any term, condition or covenant  of this Agreement or right
of either party, the prevailing party shall be  entitled to
 
                                        17    18 recover as a part of such action
or proceedings, or in a separate action  brought for that purpose, reasonable attorneys'
fees and costs, including  without limitation any and all costs and expenses arising
from (a) collection  efforts, (b) any appellate proceedings, and (c) any bankruptcy,
insolvency or  arbitration proceedings.
 
       19.   Exhibits. The following exhibits, to which reference is made in  this
Agreement, are deemed incorporated into this Agreement in their entirety  and made
a part hereof:
 
             Exhibit A   -     Description of North Expansion Parcel
 
             Exhibit A-1 -     Description of Sears Site
 
             Exhibit B   -     Description of South Expansion Parcel
 
             Exhibit C   -     Form of Build to Suit Lease
 
             Exhibit D   -     General Terms for Build to Suit Lease
 
             Exhibit E   -     Standard Terms for Purchase of Property
 
             Exhibit F   -     Basic Site Plans
 
       20.   Change in Property Description. Owner has recorded on October __, 
1996, in the Official Records of San Mateo County a parcel map creating and  describing
the various parcels comprising the Property (the "Parcel Map"). The  parties acknowledge
and agree the boundaries of the South Expansion Parcel are  subject to change in
Owner's reasonable discretion in relation to the  development and use of the South
Expansion Parcel and certain adjoining  property, that Owner may from time to time
adjust the boundaries of the South  Expansion Parcel by means of one or more lot
line adjustments or similar  mechanisms, and that the adjusted dimensions of the
South Expansion Parcel may  be as much as one-half (1/2) acre different from the
description shown on the  Parcel Map without affecting the rights and obligations
of the parties  hereunder. No such change in the boundaries of the South Expansion
Parcel shall  detrimentally affect the rights of AtHome under this Agreement. If
as a result  of such adjustment(s) the final dimensions of the South Expansion Parcel
are  more than one-half (1/2) acre different from the description shown on the 
Parcel Map, then AtHome may elect to terminate this Agreement by delivering  written
notice of such election to Owner within ten (10) days after Owner  notifies AtHome
of such discrepancy. If AtHome does not exercise such  termination right within
such 10-day period, then AtHome shall have no further  right to terminate this Agreement
pursuant to this Paragraph 20 and AtHome  shall have no other rights or remedies
with respect to 
 
                                        18    19 such change in the final dimensions
of the South Expansion Parcel.
 
         21.   Effect of Subdivision. Owner may from time to time subdivide all
or any portion of the Property into separate legal parcels (each, a "Separate Parcel").
At any and each time as Owner effectuates any such subdivision of the Property,
this Agreement shall automatically terminate, and Owner and AtHome shall execute
separate agreements for each Separate Parcel (each, a "Replacement Agreement").
Each Replacement Agreement shall encumber only one of the Separate Parcels, and
shall be in the same form as this Agreement. If AtHome fails or refuses to execute
any such Replacement Agreement upon Owner's request, then Owner shall have the right
to obtain specific performance of AtHome's obligation to execute such Replacement
Agreement. In addition, AtHome hereby irrevocably constitutes and appoints Owner
as its true and lawful attorney in fact, in its name and in its behalf, to make,
execute, acknowledge, deliver, and file any and all such Replacement Agreements
that AtHome so fails or refuses to execute. AtHome expressly understands and acknowledges
that the foregoing special power of attorney is coupled with an interest, is irrevocable,
and shall survive the dissolution or insolvency of AtHome, or the transfer by AtHome
of the whole or any portion of its interest in this Agreement (provided that any
such transfer shall be subject to the restrictions set forth above in this Agreement).
 
         22.   No Maintenance Obligations. Owner shall have no obligation whatsoever
to repair or maintain the Property or any buildings at any time situated on the
Property, or any portion thereof.
 
         23.   Subordination. This Agreement is or may become subject and subordinate
to underlying leases, mortgages, deeds of trust, easements, and CC&Rs (as defined
below) (collectively, "Encumbrances") which may now or hereafter affect the Property
of any portion thereof, and to all renewals, amendments, modifications, consolidation,
replacements and extensions thereof. Owner shall have the right to cause this Agreement
to be and become and remain subject and subordinate to any and all Encumbrances
which are now or may hereafter be executed covering the Property or any renewals,
modifications, consolidations, replacements or extensions thereof, for the full
amount of all advances made or to be made thereunder and without regard to the time
or character of such advances, together with interest thereon and subject to all
the terms and provisions thereof. In the event of termination of any such lease
or upon the foreclosure of any such mortgage or deed of trust, this Agreement shall
automatically terminate, and the holder or holders of any such Encumbrance (collectively,
"Holder") shall be under no obligation to recognize AtHome's rights under this Agreement.
Within fifteen (15) days after Owner's written request, AtHome shall execute any
and all documents reasonably required by Owner or the Holder to make this Agreement
subordinate to any lien of 

 
                                        19    20 the Encumbrance (including, without
limitation, subordination to all CC&Rs).  If AtHome fails to do so, such failure
shall constitute a default under this  Agreement, and it shall be deemed that this
Agreement is subordinated to such  Encumbrance. If Owner elects to purchase the
Second Option Subparcel pursuant  to Paragraph 3, it shall accept title to the Second
Option Subparcel as  provided in Paragraph 3, subject to any and all Encumbrances.
 
                 23.1 CC&Rs. For the purposes of this Agreement, "CC&Rs" shall 
mean any declaration of conditions, covenants and/or restrictions, or similar  instrument,
that now encumbers, or may in the future encumber the Property, as  adopted by Owner
or its successors in interest from time to time, and any  modifications or amendments
thereto.
 
                 23.2 Foreclosure of an Encumbrance. If any Holder acquires  title
to either or both of the North Expansion Parcel or the South Expansion  Parcel by
means of judicial foreclosure, a trustee's sale, or a deed in lieu of  foreclosure
under an Encumbrance (collectively, a "Foreclosure Event"), then  this Agreement
shall automatically terminate as of the date of such Foreclosure  Event, and Owner
shall within a reasonable time after the occurrence of the  Foreclosure Event refund
to AtHome the total remaining amount of the Option  Deposit then being held by Owner.
So long as Owner has given to AtHome prior  written notice of the impending Foreclosure
Event, which notice describes the  default on which the Foreclosure Event is based
(the "Owner's Default"), not  less than ten (10) days prior to the scheduled occurrence
of such Foreclosure  Event, then if AtHome fails to cure such Owner's Default prior
to the  Foreclosure Event (or, if such Owner's Default is not susceptible of cure
by  AtHome, AtHome fails to pay in full the indebtedness upon which the Foreclosure
 Event is based), effective upon the payment of the above-described refund of  the
Option Deposit to AtHome, Owner shall have no further obligations or  liability
under this Agreement. Owner shall, within five (5) days after  receipt, give AtHome
copies of any and all notices of default received by Owner  from any Holder with
respect to any Encumbrance. If AtHome so cures such  Owner's Default (or, if such
Owner's Default is not susceptible of cure by  AtHome, AtHome pays in full the indebtedness
upon which the Foreclosure Event  is based) prior to the Foreclosure Event, and
the Foreclosure Event does not  occur, the this Agreement shall remain in full force
and effect, and any  amounts paid by AtHome to such Holder to cure the Owner's Default
(the "AtHome  Advance") shall be credited to AtHome as an offset against the next
 installment(s) of rent due under the Build to Suit Lease for the Option  Building
situated on that portion of the Property with respect to which Owner's  Default
occurred, until such time as AtHome has received a full refund of the  AtHome Advance,
provided that the unpaid balance of the AtHome Advance shall  bear interest on a
per annum basis at the same rate of interest that applied to  the indebtedness upon
which the Foreclosure Event was based. Notwithstanding  the foregoing, the unpaid
balance of any AtHome Advance made with respect to the
 
                                        20    21 indebtedness owed by Owner to Ampex
Corporation that is secured by the Property  shall bear interest at the rate of
eight percent (8%) per annum. If this  Agreement expires or is otherwise terminated
prior to the execution of a Build  to Suit Lease for the First Option Building for
any reason other than a default  by AtHome, then Owner shall pay to AtHome an amount
equal to the AtHome Advance  within thirty (30) days after the date the Agreement
expires or is otherwise  terminated. If this Agreement expires or is otherwise terminated
prior to the  execution of a Build to Suit Lease for the First Option Building due
to a  default by AtHome, then AtHome shall not be entitled to receive, and Owner
 shall not be required to pay to AtHome, any refund of the AtHome Advance, or  any
amount in consideration or in lieu thereof, and Owner shall have no further  obligations
or liability under this Agreement; provided, however, that in such  event AtHome
shall be entitled to utilize the unpaid balance of the AtHome  Advance as an offset
against any claim made by Owner against AtHome.
 
         24.  Estoppel Certificates.  AtHome shall within fifteen (15) days following
written request by Owner execute and deliver to Owner any documents, including estoppel
certificates, in the form prepared by Owner (a) certifying that this Agreement is
unmodified and in full force and effect or, if modified, stating the nature of such
modification and certifying that this Agreement, as so modified, is in full force
and effect, and (b) acknowledging that there are not, to AtHome's knowledge, any
uncured defaults on the part of Owner, or, if there are uncured defaults on the
part of the Owner, stating the nature of such uncured defaults, (c) evidencing the
status of the Agreement as may be required either by a lender making a loan to owner
to be secured by deed of trust or mortgage covering the Property or a purchaser
of the Property from Owner, and (d) such other matters as may be reasonably requested
by Owner. AtHome's failure to deliver an estoppel certificate within fifteen (15)
days after delivery of Owner's written request therefor shall be conclusive upon
AtHome (i) that this Agreement is in full force and effect, without modification
except as may be represented by Owner, and (ii) that there are now no uncured defaults
in Owner's performance.
 
         If AtHome fails to so deliver a requested estoppel certificate within 
the prescribed time it shall be conclusively presumed that this Agreement is  unmodified
and in full force and effect except as represented by Owner.
 
         25.  Transfer of the Property by Owner.  In the event of any conveyance
 of all or any portion of the Property and assignment by Owner of this Agreement
 (including without limitation any transfer of the Property pursuant to a  Foreclosure
Event), Owner shall be and is hereby entirely released from all  liability under
any and all of its covenants and obligations contained in or  derived from this
Agreement occurring after the date of such conveyance and  assignment with respect
to the
 
                                        21    22 portion of the Property so transferred
by Owner, and AtHome agrees to attorn to  such transferee provided such transferee
assumes Owner's obligations under this  Agreement; provided, however, that this
Paragraph 25 shall be subject to the  provisions of Paragraph 23.2 above.
 
      26.  Limitation on Owner's Liability. Owner shall never be personally  liable
under this Agreement, and AtHome shall look solely to Owner's interest  in the Property
for recovery of any damages for breach of this Agreement by  Owner or on any judgment
in connection therewith. None of the persons or  entities comprising or representing
Owner (whether partners, shareholders,  officers, directors, trustees, employees,
beneficiaries, agents or otherwise)  shall ever be personally liable under this
Agreement or for any such damages or  judgment, and AtHome shall have no right to
effect any levy of execution  against any assets of such persons or entities on
account of any such liability  or judgment. Any lien obtained by AtHome to enforce
any such judgment, and any  levy of execution thereon, shall be subject and subordinate
to all Encumbrances  as specified in Paragraph 23 above. Notwithstanding the foregoing,
if under the  terms of this Agreement Owner is required to return the Option Deposit,
or any  portion thereof, to AtHome, and Owner breaches its obligation to do so in
 accordance with the terms of this Agreement, Owner shall be liable to AtHome  for
the return of the Option Deposit, or such portion thereof.
 
      27.  Recordation. This Agreement shall not be recorded without the prior 
consent of both Owner and AtHome; provided, however, that upon the written  request
of AtHome, Owner and AtHome shall execute and acknowledge, in  recordable form,
a memorandum of this Agreement in form reasonably acceptable  to both Owner and
AtHome, and shall cause such memorandum to be recorded in the  Official Records
of the County of San Mateo, State of California. Upon  expiration of the term of
this Agreement with respect to any portion of the  Property, AtHome shall execute,
acknowledge and deliver to Owner an appropriate  instrument prepared by Owner which
Owner may then record in the Official  Records of San Mateo County to expunge this
Agreement and any memorandum  thereof from the public record with respect to such
portion of the Property. In  addition, AtHome hereby irrevocably constitutes and
appoints Owner as its true  and lawful attorney in fact, in its name and in its
behalf, to make, execute,  acknowledge, deliver, and file any and all such instruments
that AtHome so  fails or refuses to execute. AtHome expressly understands and acknowledges
that  the foregoing special power of attorney is coupled with an interest, is  irrevocable,
and shall survive the dissolution or insolvency of AtHome, or the  transfer by AtHome
of the whole or any portion of its interest in this  Agreement (provided that any
such transfer shall be subject to the restrictions  set forth in this Agreement).
 
                                        22    23
 
         28.     Survival.  This Agreement shall survive the execution of each Build
to Suite Lease.
 
         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first hereinabove set forth.
 
                                        "Owner"

 
                                        MARTIN/CAMPUS ASSOCIATES, L.P.,
                                        a Delaware limited partnership
 
                                        By:  Martin/Redwood Partners
                                             L.P., a California limited
                                             partnership, its General
                                             Partner
 
                                             By:  The Martin Group of
                                                  Companies, Inc., a
                                                  California corporation,
                                                  its General Partner
 
                                                  By:  /s/
                                                       --------------------------
                                                  Its:             
                                                       --------------------------

 
                                        "AtHome"
 
                                        AT HOME CORPORATION,
                                        A Delaware corporation

 
                                        By:  /s/ KENNETH A. GOLDMAN
                                             ------------------------------------
                                        Its: CFO
                                             ------------------------------------

 
                                        By:  
                                             ------------------------------------
                                        Its: 
                                             ------------------------------------

 

 
 
                                        23    24   
 
                 FIRST AMENDMENT TO BUILD TO SUIT OPTION AGREEMENT
 
         THIS FIRST AMENDMENT TO BUILD TO SUIT OPTION AGREEMENT ("Amendment") is
made and entered into as of this _____ day of June, 1998, by and between MARTIN/CAMPUS
ASSOCIATES, L.P., a Delaware limited partnership ("Owner"), and AT HOME CORPORATION,
a Delaware corporation ("AtHome").
 
                                  R E C I T A L S
 
         This Amendment is made and entered into with reference to and upon the
basis of the following facts, intentions and understandings of the parties:
 
         A. Owner is the owner of (i) that certain real property situated in the
City of Redwood City, County of San Mateo, State of California, which is depicted
on Exhibit A hereto (the "North Expansion Parcel") and (ii) that certain unimproved
real property situated in the City of Redwood City, County of San Mateo, State of
California, which is depicted on Exhibit B hereto (the "South Expansion Parcel").
The North Expansion Parcel and the South Expansion Parcel shall be hereinafter from
time to time collectively referred to as the "Property".
 
         B. Owner and AtHome have entered into that certain Build to Suit Option
Agreement dated as of October 25, 1996 (the "Agreement"), whereby Owner has granted
to AtHome (i) options to lease all or certain portions of the Property on a build
to suit basis and on certain agreed terms and conditions, and (ii) an option to
acquire a portion of the Property, as defined in the Agreement as the Second Option
Subparcel, on certain agreed terms and conditions.
 
         C. Owner and AtHome now desire to amend the Agreement to cancel the option
to acquire the Second Option Subparcel and to grant in lieu thereof an option to
acquire the South Expansion Parcel and a right to participate in the proceeds of
the sale of the Second Option Subparcel to a third party, upon the terms and conditions
set forth herein.
 
         D. All capitalized terms not specifically defined in this Amendment shall
have the same meanings ascribed to them in the Agreement.
 
         NOW, THEREFORE, in consideration of the payment by AtHome to Owner of the
sum of One Hundred Dollars ($100) and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged by Owner, Owner and AtHome
hereby agree as follows:
 
         1. Second Option. Owner acknowledges that AtHome has timely exercised the
Second Option pursuant to the terms of Paragraph 2.6 of the Agreement.
 
         2. Third Option. The second sentence of Paragraph 2.7 of the Agreement
is hereby deleted and the following sentence is inserted in place thereof:

 
                                         1    25
 
                "The failure of AtHome so to exercise the Third Option on or
                before the Third Option Notice Date shall terminate AtHome's
                right to exercise the Third Option and shall terminate AtHome's
                right to exercise its option to purchase the South Expansion
                Parcel pursuant to Paragraph 3 unless Tenant delivers the South
                Expansion Parcel Option Notice on or before the Third Option
                Notice Date (in which case AtHome's rights and obligations shall
                be governed by Paragraph 3 below)."
 
         3. Option to Purchase. Paragraph 3 of the Agreement is deleted in its entirety
and the following Paragraph 3 is inserted in place thereof:
 
                "3. Option to Purchase.
 
                       "3.1. Option to Purchase South Expansion Parcel. AtHome
                shall have the option (in lieu of requiring Owner to develop the
                Third Option Building to be situated on the South Expansion
                Parcel) to acquire, on an all cash basis, in the manner set forth
                in Paragraph 3.2, fee title to the South Expansion Parcel. The
                purchase price for the South Expansion Parcel shall be Two
                Million Eighteen Thousand Four Hundred Seventy Seven and 00/100
                Dollars ($2,018,477.00) (the "Base Purchase Price"), subject to
                adjustment as provided herein. The Base Purchase Price has been
                agreed upon by Owner and AtHome based upon the entitlements for
                the South Expansion Parcel obtained as of March 31, 1998 for the
                construction of a building containing 48,569 Rentable Area. Owner
                and AtHome have agreed to adjust the Base Purchase Price in the
                event Owner obtains sufficient entitlements for the construction
                of a building containing up to 110,000 square feet of Rentable
                Area on the South Expansion Parcel. Prior to the Third Option
                Notice Date, Owner shall use reasonable good faith efforts to
                obtain such entitlements. In the event that Owner is successful
                in obtaining entitlements for increased Rentable Area, the Base
                Purchase Price shall be increased by an amount equal to the
                product of Sixty and 00/100 Dollars ($60.00) multiplied by the
                total amount of square feet of Rentable Area approved by the City
                of Redwood City in excess of 48, 569 square feet for the Third
                Option Building to be constructed on the South Expansion Parcel.
                The Base Purchase Price as adjusted is hereinafter referred to as
                the "Adjusted Purchase Price." In order to elect to exercise its
                option to acquire the South Expansion Parcel, AtHome shall
                deliver to Owner, in lieu of its delivery to Owner of AtHome's
                notice exercising the Third Option, a written notice setting
                forth AtHome's exercise of its option to acquire the South
                Expansion Parcel (the "South Expansion Parcel Option Notice").
                The South Expansion Parcel Option Notice shall not be effective
                unless it includes the following: (i) immediately available funds
                in an amount equal to five percent (5%) of the Base Purchase
                Price or the Adjusted Purchase Price, as the case may be, for the
                South Expansion Parcel (the "Deposit"), and (ii) AtHome's
                execution of the liquidated damage provision set forth in Exhibit
                E attached to this Agreement. The Deposit shall be held by the
                Title Company, defined in Exhibit E, in an interest bearing
                account and shall constitute liquidated damages, and shall 

 
                                        2

    26
                be paid to Owner in the event AtHome fails to consummate the
                purchase of the South Expansion Parcel in accordance with the
                terms of this Paragraph 3, other than as a direct result of
                Owner's failure to perform its obligations under this Paragraph
3
                or Exhibit E. Escrow for the sale of the South Expansion Parcel
                to AtHome shall close thirty (30) days after Owner's receipt of
                the South Expansion Parcel Option Notice, or such other date as
                Owner and AtHome shall mutually agree. AtHome's acquisition of
                the South Expansion Parcel shall be subject to the provisions of
                Paragraph 3.2. If AtHome does not deliver the South Expansion
                Parcel Option Notice to Owner as described above, then AtHome's
                option to purchase the South Expansion Parcel shall terminate and
                cease to be of any force or effect as of the Third Option Notice
                Date. All closing, title insurance and transfer costs, including
                without limitation applicable sales and transfer taxes,
                associated with AtHome's acquisition of the South Expansion
                Parcel shall be paid by Owner and AtHome in accordance with the
                custom in San Mateo County.
 
                       "3.2. Conditions. The effectiveness of AtHome's option to
                acquire the South Expansion Parcel, as set forth in this
                Paragraph 3, is conditioned on the following: (a) AtHome has not
                previously entered into a Sublet of any Build to Suit Lease or
                the Broadway Lease that requires Owner's consent; and (b) no
                monetary or other material default by AtHome exists under either
                any Build to Suit Lease or the Broadway Lease which remains
                uncured after the giving of any applicable notice and the
                expiration of any applicable cure period. In addition, if any of
                the conditions specified under clauses (a) or (b) above do not
                continue to be satisfied as of the date on which the escrow for
                the sale of the South Expansion Parcel to AtHome is scheduled to
                close, then unless Owner waives in writing any such conditions,
                AtHome's exercise of its right to acquire the South Expansion
                Parcel under this Paragraph 3 shall be null and void, and this
                Agreement shall terminate effective as of the date on which the
                escrow for the sale of the South Expansion Parcel to AtHome was
                scheduled to close.
 
                       "3.3. Process. Should AtHome exercise its option to
                acquire the South Expansion Parcel within the applicable period
                of time set forth in this Paragraph 3, AtHome's acquisition of
                the South Expansion Parcel shall be carried out on (a) the terms
                and conditions described in this Paragraph 3 (the "Agreed
                Terms"), and (b) the terms and conditions set forth on Exhibit E
                attached to this Agreement (the "Standard Terms"). To the extent
                there is any discrepancy between the Agreed Terms and the
                Standard Terms, the Agreed Terms shall be controlling."
 
         4. Exhibits. Exhibit E to the Agreement is hereby deleted and Exhibit E
attached hereto is inserted in place thereof. The attached Exhibit E deletes all
references to the defined term "Second Option Subparcel" and inserts in place thereof
the defined term "South Expansion Parcel" and deletes all references to the "Purchase
Price" and inserts in place thereof a reference to either the Base Purchase Price
or the Adjusted Purchase Price, as the case may be. All references to Exhibit E
in the Agreement shall be deemed to reference Exhibit E attached hereto.

 
                                        3    27
 
         5. Sale of Second Option Subparcel. The following is inserted as a new
Paragraph 29 of the Agreement:
 
                "29. Sale of Second Option Subparcel. Owner shall use reasonable
                efforts to subdivide the property on which the Second Option
                Building is situated so that one of the buildings comprising the
                Second Option Building becomes situated on one or more legal
                parcels (which parcel or parcels, together with all rights and
                appurtenances thereto, are collectively called the "Second Option
                Subparcel"), separate and apart from any other areas of the
                Project and the North Expansion Parcel. In the event Owner
                succeeds in creating the Second Option Subparcel and and
                subsequently sells the Second Option Subparcel to a third party
                (other than an Affiliate (as defined below) of Owner, At Home
                shall have the right to participate in the Net Sale Proceeds (as
                defined below) provided that close of escrow for such sale occurs
                on or before March 31, 2003, subject to the terms and conditions
                of this Paragraph 29, in consideration for At Home's agreement to
                cancel its option to acquire the Second Option Subparcel. At
                Home's participation shall be equal to seventeen and one/half
                percent (17.5%) of the amount that (i) Net Sales Proceeds exceed
                (ii) the product of Two Hundred Sixty and 00/100 Dollars
                ($260.00) multiplied by the total amount of square foot of the
                Second Option Building located on the Second Option Subparcel at
                the time of the sale. In the event that Owner sells in a single
                transaction the Second Option Subparcel together with all or any
                part of any other areas of or improvements within the Project,
                Owner shall use reasonable good faith efforts to allocate the Net
                Sales Proceeds attributable to the Second Option Subparcel. As
                used herein, Net Sales Proceeds shall mean the Gross Sum paid to
                Owner in connection with the sale, less the sum of the following,
                if and to the extent applicable: all closing costs, escrow fees,
                title insurance costs, recording costs, survey costs, brokerage
                or selling commissions or fees, finder's fees, attorneys' fees,
                closing prorations and other costs or expenses reasonably and
                necessarily incurred, in connection with such sale. As used
                herein, the term "Gross Sum" shall mean the total financial
                consideration paid to Owner in connection with the sale reduced
                by any reserves or purchase price hold-backs required to be
                established by Owner (but only if, and to the extent, such
                reserves or hold-backs actually are retained by the purchaser,
                unless disbursed to Owner for reimbursement of Owner's cost to
                repair or remediate pursuant to the purchase and sale agreement).
                As used herein, the term "Affiliate" shall mean any person or
                entity directly or indirectly controlled by, controlling or under
                common control of Owner or The Martin Group of Companies, Inc.,
a
                California corporation ("TMG"); any partnership, corporation or
                other entity resulting from the merger or consolidation of Owner;
                any partnership, corporation or other entity in which Owner or a
                constituent partner of Owner or TMG owns an interest; any person
                or entity which acquires all or substantially all of the
                constituent interests in Owner or TMG, any person or entity who
                is a partner or has an ownership interest directly or indirectly
                in any of the foregoing."

 
                                        4    28
 
         6. Credit Against Option Price. The following is inserted as a new Paragraph
30 of the Agreement:
 
                "30. Credit Against Option Price. To accommodate Owner's
                construction financing, AtHome has entered into various
                agreements with or for the benefit of Guaranty Federal Bank,
                F.S.B. ("Lender"), including a side letter dated April 6, 1998
                (the "Side Letter"). Under the Side Letter, AtHome may be
                required to cure a default by Owner under Owner's loan agreement
                (which, together with the note, deed of trust and other ancillary
                instruments evidencing and/or securing such loan are called the
                "Construction Loan Documents") with Lender in order to secure the
                release of the South Expansion Parcel from Lender's deed of
                trust. To induce AtHome to enter into the agreements with and for
                the benefit of Lender, Owner hereby covenants and agrees that all
                sums paid by AtHome to Lender, as permitted by the Side Letter or
                otherwise, for the purpose of curing any actual or alleged
                default of Owner under the Construction Loan Documents and/or
                securing a partial release to remove the deed of trust from the
                South Expansion Parcel (together with interest thereon at the
                lesser of the maximum lawful rate or a per annum rate of seven
                percent (7%) above the Federal Reserve discount rate) shall be
                due and payable by Owner upon demand. If Owner fails to make any
                such payment, AtHome shall be entitled to offset the full amount
                of such principal and interest against the Base Purchase Price
                (or the Adjusted Purchase Price, if applicable) for the South
                Expansion Parcel under Paragraph 3.1 above."
 
         7. Ratification. Except as expressly amended hereby, the Agreement is hereby
ratified and confirmed and shall remain in ful force and effect in all other respects.
 
         8. Choice of Law. This Amendment and the rights and obligations of the
parties hereunder shall be construed and enforced in accordance with the laws of
the State of California as applied to contracts made and entirely performed therein.
 
                IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first hereinabove set forth.
 
                      [SIGNATURES TO FOLLOW ON THE NEXT PAGE]

 
                                        5    29
 
                       "Owner"
 
                       MARTIN/CAMPUS ASSOCIATES, L.P.,
                       a Delaware limited partnership
 
                       By:    Martin/Redwood Partners, L.P.,
                              a California limited partnership
                              Its General Partner
 
                              By:     TMG Redwood LLC,
                                      a California limited liability company
                                      Its General Partner
 
                                      By:    The Martin Group of Companies, Inc.,
                                             a California corporation
                                             Its Managing Member
 
                                             By: /s/
                                                 --------------------------------
                                             Its: Vice President
                                                 --------------------------------

 
                                             By: 
                                                 --------------------------------
                                             Its:
                                                 --------------------------------

 
                       "AtHome"
 
                       AT HOME CORPORATION,
                       a Delaware corporation
 
                       By: /s/ KENNETH A. GOLDMAN
                           --------------------------------
                       Its: CFO
                           --------------------------------

 
                       By: 
                           --------------------------------
                       Its:
                           --------------------------------

 
 
                                        6