LEASE TERMINATION AND SETTLEMENT AGREEMENT

     This Lease  Termination and Settlement  Agreement  ("Agreement") is entered
into as of the 25th day of February,  2002  ("Effective  Date"),  by and between
PWREF/MCC-CHINA  BASIN, LLC., a Delaware limited liability company ("Landlord"),
and RATEXCHANGE  CORPORATION,  a Delaware corporation ("Tenant").  (Landlord and
Tenant shall hereinafter collectively be referred to as the "Parties".)

                                R E C I T A L S :

     A.  BRE/CBL,   L.L.C.,  a  Delaware  limited   liability  company  ("BRE"),
predecessor-in-interest  to  Landlord  with  respect to the  Building  described
below,  and Tenant  entered into that certain  Office Lease  ("Original  Lease")
dated October 14, 1999, as amended by the First Amendment to Office Lease, dated
February 21, 2000 (the "First  Amendment"),  and the Second  Amendment to Office
Lease,  dated June 15,  2000 (the  "Second  Amendment"),  whereby  BRE leased to
Tenant, and Tenant leased from BRE,  approximately 5,571 rentable square feet of
space,  commonly known as Suites 3705 and 3515 (the  "Premises")  located on the
third (3rd) floor of the Wharfside  Building at 185 Berry Street, San Francisco,
California 94107 (the  "Building").  The Original Lease, the First Amendment and
the Second  Amendment  are  collectively  referred to as the "Lease",  a copy of
which is attached hereto as Exhibit A.

     B.  Pursuant to the terms of the Lease,  Landlord  holds the  proceeds of a
letter of credit in the amount of One Hundred  Forty Five  Thousand Nine Hundred
Thirty Seven  Dollars and 25/00  ($145,937.25)  (the "Letter of Credit"),  which
Letter of Credit was  provided  by Tenant for the  benefit of  Landlord  and BRE
pursuant to the Lease.  The Letter of Credit was drawn upon in  accordance  with
the terms of the Lease.

     C. In  October,  2001,  Tenant  vacated  the  Premises  and filed a lawsuit
against  Landlord  for  breaching  the  covenant of quiet  enjoyment  ("Tenant's
Claims")  and  Landlord  responded to Tenant's  complaint  and  cross-complained
against Tenant for breach of the Lease ("Landlord's  Claims"),  which claims are
presently  pending in the Superior Court of the State of California,  in and for
the City and County of San  Francisco  as Action  No.  324564  (hereinafter  the
"Pending Action").

     D. In order to avoid  litigation  of the  matters  alleged  in the  Pending
Action,  as well as other  disputed  issues  between the  Parties,  Landlord and
Tenant  have  agreed to enter into this  Agreement  to settle  their  claims and
release one another from any further  liability,  except as  otherwise  provided
herein.

                               A G R E E M E N T :

     NOW,  THEREFORE,  in  consideration  of  the  foregoing  recitals  and  the
conditions and the covenants hereinafter contained,  and for other consideration
hereinafter set forth, the receipt

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and  sufficiency  of which are hereby  acknowledged,  Landlord and Tenant hereby
agree as follows:

     1. Settlement of Claims and  Termination of the Lease.  Upon the receipt by
Landlord of (1) the payment by Tenant in the amount of Fifty Thousand and 00/100
dollars ($50,000),  in lawful money of the United States and (2) the delivery by
Tenant to Landlord of both (x) a stock  certificate  or  certificates  for Fifty
Thousand shares (50,000) of common stock of Tenant,  which common stock shall be
restricted stock pursuant to Rule 144 promulgated by the Securities and Exchange
Commission  and which  shall bear a legend so stating,  and (y) a duly  executed
Registration  Rights Agreement in the form attached hereto as Exhibit B, then as
of the Effective Date of this Agreement,  the Lease shall  immediately be deemed
terminated and of no further force or effect and the Mutual Release set forth in
Section 4 of this Agreement shall also become effective.

     2.  Letter of  Credit.  Tenant  hereby  waives  any rights or claims to the
proceeds from the Letter of Credit,  which  proceeds are hereby deemed earned by
Landlord  under  the  Lease  as of the  Effective  Date  of this  Agreement.

     3.   Dismissal  of  Pending   Action.   Upon  delivery  by  Tenant  of  the
consideration provided in Section 1 and upon the complete execution and delivery
of this  Agreement,  Tenant will file a  dismissal  with  prejudice  of Tenant's
Claims,  and Landlord  shall file a dismissal  without  prejudice of  Landlord's
Claims.

     4. Mutual Release of Liability.  The Parties,  for themselves and for their
respective successors,  predecessors, agents, employees, attorneys, and assigns,
and any person or entity  claiming  by,  under,  or through any of them,  hereby
release,  acquit and forever  discharge each other,  including their  respective
successors, predecessors, agents, employees, attorneys, and assigns, of and from
any and all actions, causes of action, suits, debts, liens,  contracts,  rights,
agreements,   obligations,  promises,  liabilities,  claims,  demands,  damages,
controversies,  losses,  costs and  expenses  (including,  but not  limited  to,
attorney's fees and costs actually incurred),  past, present or future, known or
unknown,  fixed or contingent,  suspected or unsuspected,  of any nature or kind
whatsoever  between  them,  including  (without  limiting the  generality of the
foregoing) all claims or causes of action arising out of, or relating in any way
to, the  matters  alleged,  or which  could have been  alleged,  in the  Pending
Action. Each of the Parties acknowledges that there is a risk that subsequent to
the  execution  of this  Agreement,  one or both of the Parties  could decide or
determine  that  obligations  exist to it or that it has  incurred  or  suffered
damages  which were  unknown or  unanticipated  at the time this  Agreement  was
executed,  which if known may have  materially  affected its decision to execute
this  Agreement.  Each of the Parties further  acknowledges  and agrees that, by
reason of the release  contained herein, it is assuming the risk of such unknown
matters and agrees that this release  applies  thereto.  Therefore,  the risk of
such unknown  matters having been bargained for between the Parties as a part of
the consideration  for this Agreement,  each of the Parties expressly waives and
releases all rights and benefits  conferred upon it by the provisions of Section
1542 of the California Civil Code, which provides:

     "A GENERAL  RELEASE DOES NOT EXTEND TO CLAIMS  WHICH THE CREDITOR  DOES NOT
     KNOW OR SUSPECT


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     TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,  WHICH IF KNOWN
     BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."

     Each party  acknowledges  that it has received the advice of legal  counsel
with respect to the aforementioned  release and waiver and understands the terms
thereof.

     5. Representations of Tenant. Tenant represents and warrants to Landlord as
follows:

          (a) Tenant has not heretofore assigned or sublet all or any portion of
its interest in the Lease;

          (b) No other person,  firm or entity has any right,  title or interest
in the Lease;

          (c) Tenant has the full  right,  legal power and actual  authority  to
enter into this  Agreement and to terminate the Lease without the consent of any
person, firm or entity;

          (d)  Tenant  is  a  corporation  duly  organized,   validly  existing,
authorized to exercise all its corporate powers,  rights and privileges,  and in
good  standing  in  the  States  of  California   and  Delaware  and  all  other
jurisdictions in which it is doing business; and

          (e) All issued and  outstanding  shares of Tenant's  common  stock (i)
have  been  duly  authorized  and  validly  issued,  (ii)  are  fully  paid  and
nonassessable,  and  (iii) to the best of  Tenant's  knowledge,  formed  after a
reasonable  and good faith  inquiry,  have been  issued in  compliance  with all
applicable state and federal laws concerning the issuance of such securities.

Notwithstanding  the  termination  of the Lease  and the  release  of  liability
provided  for  herein,  the  representations  and  warranties  set forth in this
Section 5 shall survive the  termination of the Lease and Tenant shall be liable
to Landlord for any material inaccuracy or breach thereof.

     6. Representations of Landlord.  Landlord represents and warrants to Tenant
as follows:

          (a) Landlord has sufficient liquid and other assets and experience and
sophistication  in  investment  matters  that it does and  would  qualify  as an
"Accredited  Investor"  within the meaning of the  federal and state  securities
laws and regulations;

          (b) Landlord has conducted its own independent due diligence, with the
assistance of its own legal and financial advisors having appropriate  expertise
in such matters,  concerning  the present and  potential  financial and business
condition and prospects of Tenant and into the present and/or potential value of
the  common  stock of  Tenant,  and has relied  solely on the  results  thereof,
including the advice of its own advisers, in deciding to accept 50,000 shares of
common stock of Tenant as part of the consideration for this Agreement;

          (c) Other than as expressly  represented in this  Agreement,  Landlord
has not relied  upon  anything  stated,  orally or in writing,  expressly  or by
implication, by Tenant in


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<PAGE>

deciding to enter into this  Agreement  and/or to accept 50,000 shares of common
stock of Tenant as part of the consideration for this Agreement;

          (d) Landlord  understands and  acknowledges  that the 50,000 shares of
common stock of Tenant  which are to be  delivered as part of the  consideration
for this agreement are restricted shares which have not been registered pursuant
to either state or federal securities laws, that there is presently no available
market for such  shares and that such  shares may not be freely  transferred  or
sold.  Landlord  further  understands  and  acknowledges  that  Tenant  makes no
representation, express or implied, that there ever will be a market or means of
transferring or selling such shares;

          (e) Landlord  understands and acknowledges  that (i) the 50,000 shares
are  restricted  securities  (as defined under Rule 144) and may not be offered,
sold or otherwise  transferred  unless and until registered under the Securities
Act or pursuant to an exemption from the registration  requirements  thereof and
(ii) the certificates  representing the Shares will bear a legend  substantially
in the following form:

     "THE  SECURITIES  EVIDENCED  HEREBY  HAVE NOT  BEEN  REGISTERED  UNDER  THE
     SECURITIES ACT OF 1933, AS AMENDED (THE  "SECURITIES  ACT"),  OR APPLICABLE
     STATE  SECURITIES  LAWS AND MAY NOT BE  OFFERED  FOR SALE,  SOLD,  PLEDGED,
     ASSIGNED OR OTHERWISE DISPOSED OF, AND NO TRANSFER OF THE SECURITIES MAY BE
     EFFECTED  BY THE  COMPANY OR ITS  TRANSFER  AGENT,  IN THE  ABSENCE OF SUCH
     REGISTRATION OR ANY EXEMPTION THEREFROM."

          (f) Landlord shall rely solely on its own legal and financial advisors
with respect to the transferability of such shares at any time in the future.

Notwithstanding  the  termination  of the Lease  and the  release  of  liability
provided  for  herein,  the  representations  and  warranties  set forth in this
Section 6 above shall survive the termination of the Lease and Landlord shall be
liable to Tenant for any material inaccuracy or breach thereof.

     7. Continuing  Liability.  Notwithstanding the termination of the Lease and
the release of liability  provided  herein,  Tenant shall  remain  liable,  with
respect  to the  period of its  tenancy  prior to the  Effective  Date,  for the
performance of Tenant's  indemnification  obligations in Article 10 of the Lease
and  Landlord  shall have all rights and  remedies  with  respect to such Tenant
obligations  as set forth in the  Lease,  but only to the extent  that  Tenant's
obligations are paid or performed by the insurance  policies required to be held
by Tenant under the Lease.

     8. Integration. This Agreement constitutes the entire agreement between the
Parties and  supersedes  all prior and  contemporaneous  contracts,  agreements,
promises,  and understandings  between the parties concerning the subject matter
of this  Agreement.  This Agreement may not be altered,  modified,  or otherwise
changed in any respect  except by a writing duly  executed by both  Parties.  No
representations,  circumstances,  or  conditions  existing  before the Agreement
shall be used in any way to modify the Agreement.


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<PAGE>

     9. Attorneys' Fees.  Should any dispute arise between the parties hereto or
their   legal   representatives,   successors   and   assigns   concerning   the
interpretation  or  performance of any provision of this Agreement or the rights
and duties of any  person in  relation  thereto,  the party  prevailing  in such
dispute shall be entitled, in addition to such other relief that may be granted,
to recover from the other party  reasonable  attorneys'  fees and legal costs in
connection with such dispute.

     10. Severability. Should any provision of this Agreement be held invalid or
illegal, such illegality shall not invalidate the whole of this Agreement,  but,
rather,  the  Agreement  shall be construed as if it did not contain the illegal
part,  and the rights and  obligations  of the Parties  shall be  construed  and
enforced accordingly.

     11. Governing Law. This Agreement shall be governed and construed under the
laws of the State of California.

     12. Counterparts.  This Agreement may be executed in counterparts,  each of
which shall be deemed an original,  but such counterparts,  when taken together,
shall constitute one agreement.

     13. Binding Effect. This Agreement shall inure to the benefit of, and shall
be binding upon, the parties hereto and their respective legal  representatives,
successors and assigns.

     14. Authority.  The person executing this Agreement on behalf of each Party
represents  and  warrants  that such person has the  authority  to execute it on
behalf of such party.

     15. Time of the Essence.  Time is of the essence of this  Agreement and the
provisions contained herein.

     16.  Further  Assurances.  Landlord and Tenant hereby agree to execute such
further documents or instruments as may be necessary or appropriate to carry out
the express provisions of this Agreement.


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<PAGE>

     17.  Voluntary  Agreement.  The parties have read this Agreement and mutual
release as contained  herein,  and on the advice of counsel they have freely and
voluntarily entered into this Agreement.

     IN WITNESS WHEREOF,  Landlord and Tenant have executed this Agreement as of
the day and year first above written.

                                         "LANDLORD"

                                         PWREF/MCC-CHINA BASIN L.L.C.,
                                         a Delaware limited liability company

                                         By: ________________________________

                                             Its: ___________________________


                                         "TENANT"

                                         RATEXCHANGE CORPORATION,
                                         a Delaware corporation

                                         By: ________________________________

                                             Its: ___________________________

                                         By: ________________________________

                                             Its: ___________________________


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<PAGE>

                                    EXHIBIT A

                                  OFFICE LEASE



                                    EXHIBIT A
                                       -1-
<PAGE>

                                    EXHIBIT B

                          REGISTRATION RIGHTS AGREEMENT


                                    EXHIBIT B
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