<PAGE>   1
                                                                   EXHIBIT 10.43



                                INDUSTRIAL LEASE
                             (1347 Crossman Avenue)



                       Effective Date: December ___, 1999



                                  DEFINED TERMS



Landlord:                           NETWORK APPLIANCE, INC., a California
                                    corporation

Landlord's Address For Notice:      495 East Java Drive
                                    Sunnyvale, California  94089
                                    Attention:  Mr. Thomas Bryant

Tenant:                             TRW INC., an Ohio corporation

Tenant's Address For Notice:        TRW Inc.
                                    12011 Sunset Hills Road
                                    Reston, Virginia  20190
                                    Attn:  Ms. Marsha A. Klontz

                                    And to:

                                    TRW Electronic Systems
                                    1330 Geneva Drive
                                    P.O. Box 3510
                                    Sunnyvale, California  94088-3510

Project:                            Certain parcels of land situated in Santa
                                    Clara County, California consisting of
                                    27.848 acres of land described as APN
                                    #110-42.2.2.6.7.8, having addresses of 1345
                                    and 1346 Crossman Avenue and 1330 and 1350
                                    Geneva Drive in Sunnyvale, California

Building:                           1347 Crossman Avenue, Sunnyvale, California

Premises:                           The Building, together with the Property

Property:                           That certain real property described in
                                    Exhibit A hereto

Term:                               From the Commencement Date to June 30, 2001

Commencement Date:                  December ___, 1999

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Base Rent Per Month:                Sixty-Nine Thousand One Hundred Forty-Three
                                    and 75/100 Dollars ($69,143.75)

Lease Year:                         Shall refer to each three hundred sixty-five
                                    (365) day period during the Term commencing
                                    on the Commencement Date and on each
                                    anniversary thereof.

Permitted Uses:                     General office purposes and no other uses
                                    shall be permitted without the prior written
                                    consent of Landlord.

EXHIBITS

         A    -   Premises
         B    -   Estoppel Certificate


                  The Defined Terms set forth above and the Exhibits attached
hereto are incorporated into and made a part of the following Lease. Each
reference in this Lease to any of the Defined Terms shall mean the respective
information above and shall be construed to incorporate all of the terms
provided under the particular Lease paragraph pertaining to such information. In
the event of any conflict between the Defined Terms and the provisions of the
Lease, the latter shall control.

               LANDLORD (_________) AND TENANT (_________) AGREE.
                          initial                initial


<PAGE>   3

                                Table of Contents



<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>      <C>                                                                                                   <C>
1.       PREMISES.................................................................................................1
         1.1.     Premises........................................................................................1
         1.2.     Reserved Rights.................................................................................1
         1.3.     As-Is...........................................................................................1

2.       TERM.....................................................................................................1

3.       RENT.....................................................................................................1
         3.1.     Base Rent.......................................................................................1
         3.2.     Late Charge and Interest........................................................................1
         3.3.     Net Lease.......................................................................................2

4.       UTILITIES................................................................................................2

5.       TAXES....................................................................................................2
         5.1.     Real Property Taxes.............................................................................2
         5.2.     Definition of Real Property Taxes...............................................................2
         5.3.     Personal Property Taxes.........................................................................3

6.       INSURANCE................................................................................................3
         6.1.     Landlord........................................................................................3
         6.2.     Tenant..........................................................................................3
         6.3.     General.........................................................................................4
         6.4.     Indemnity.......................................................................................4
         6.5.     Exemption of Landlord from Liability............................................................5

7.       REPAIRS AND MAINTENANCE..................................................................................5
         7.1.     Tenant..........................................................................................5
         7.2.     Landlord........................................................................................5

8.       ALTERATIONS..............................................................................................5
         8.1.     Trade Fixtures; Alterations.....................................................................5
         8.2.     Damage; Removal.................................................................................6
         8.3.     Liens...........................................................................................6

9.       USE......................................................................................................6

10.      ENVIRONMENTAL MATTERS....................................................................................7
         10.1.    Hazardous Materials.............................................................................7
         10.2.    Indemnification.................................................................................7

11.      DAMAGE AND DESTRUCTION...................................................................................8
         11.1.    Casualty........................................................................................8
         11.2.    Tenant's Fault..................................................................................9
         11.3.    Uninsured Casualty..............................................................................9
</TABLE>



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<PAGE>   4

<TABLE>
<S>      <C>                                                                                                   <C>
         11.4.    Waiver..........................................................................................9

12.      EMINENT DOMAIN...........................................................................................9
         12.1.    Total Condemnation..............................................................................9
         12.2.    Partial Condemnation............................................................................9
         12.3.    Award...........................................................................................9
         12.4.    Temporary Condemnation.........................................................................10

13.      DEFAULT.................................................................................................10
         13.1.    Events of Defaults.............................................................................10
         13.2.    Remedies.......................................................................................11
         13.3.    Cumulative.....................................................................................12

14.      ASSIGNMENT AND SUBLETTING...............................................................................12

15.      ESTOPPEL, ATTORNMENT AND SUBORDINATION..................................................................13
         15.1.    Estoppel.......................................................................................13
         15.2.    Attornment.....................................................................................13
         15.3.    Subordination..................................................................................13

16.      MISCELLANEOUS...........................................................................................14
         16.1.    General........................................................................................14
         16.2.    Signs..........................................................................................15
         16.3.    Waiver.........................................................................................15
         16.4.    Financial Statements...........................................................................15
         16.5.    Limitation of Liability........................................................................15
         16.6.    Notices........................................................................................15
         16.7.    Brokerage Commission...........................................................................15
         16.8.    Authorization..................................................................................16
         16.9.    Holding Over; Surrender........................................................................16
         16.10.   Joint and Several..............................................................................16
         16.11.   Covenants and Conditions.......................................................................16
         16.12.   Addenda........................................................................................16
</TABLE>



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<PAGE>   5


1.                PREMISES.

                  1.1. Premises. Landlord hereby leases to Tenant the Premises
as shown on Exhibit A attached hereto, but excluding any other portion of the
Project.

                  1.2. Reserved Rights. Landlord reserves the right to enter the
Premises upon reasonable notice to Tenant (except in case of an emergency)
and/or to undertake the following: inspect the Premises and/or the performance
by Tenant of the terms and conditions hereof. Landlord acknowledges and agrees
that any such activities by Landlord on the Premises shall be subject to any
reasonable security precautions created by Tenant as a result of any classified
work performed by Tenant in the Building on behalf of the United States
Government.

                  1.3. As-Is. Tenant acknowledges that Tenant has owned and
occupied the Premises for an extensive period of time prior to the Commencement
Date of this Lease and, as such, is familiar with the physical condition
thereof. Tenant recognizes that Landlord would not lease the Premises except on
an "as-is" basis and that Landlord has made no representations of any kind in
connection with improvements or physical conditions on, or bearing on, the use
or condition of the Premises.

2.                TERM. The Term of the Lease shall commence ("Commencement
Date") on the Commencement Date and expire on June 30, 2001. Tenant has
determined that the Premises are acceptable for Tenant's use; and acknowledges
that Landlord has made no representations or warranties in connection with the
physical condition of the Premises or Tenant's use of the same upon which Tenant
has relied directly or indirectly for any purpose.

3.                RENT.

                  3.1 Base Rent. Tenant shall pay to Landlord, at such address
as Landlord shall from time to time designate in writing to Tenant for the
payment of Rent, the Base Rent, without notice, demand, offset or deduction, on
the first day of each calendar month. Upon the execution of this Lease, Tenant
shall pay to Landlord the first month's Base Rent. If the Term commences (or
ends) on a date other than the first (or last) day of a month, Tenant shall pay
on the Commencement Date or first day of the last month a pro rata portion of
Base Rent, prorated on a per diem basis with respect to the portion of the month
within the Term. All sums other than Base Rent which Tenant is obligated to pay
under this Lease shall be deemed to be additional rent due hereunder, whether or
not such sums are designated "additional rent." The term "Rent" means the Base
Rent and all additional rent payable hereunder.

                  3.2 Late Charge and Interest. The late payment of any Rent
will cause Landlord to incur additional costs, including administration and
collection costs and processing and accounting expenses and increased debt
service. If Landlord has not received any installment of Rent within five (5)
days after such amount is due, Tenant shall pay a late charge of ten percent
(10%) of the delinquent amount, which is agreed to represent a reasonable
estimate of the costs incurred by Landlord. In addition, all such delinquent
amounts shall bear interest from the date such amount was due until paid in full
at a rate per annum ("Applicable Interest Rate") equal to the greater of (a)
five percent (5%) per annum plus the then federal discount rate on advances to
member banks in effect at the Federal Reserve Bank of San Francisco on the 25th
day of the



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<PAGE>   6

month preceding the date of this Lease or (b) ten percent (10%); provided, in no
event shall the Applicable Interest Rate exceed the maximum interest rate
permitted by law which may be charged under such circumstances. Landlord and
Tenant recognize that the damage which Landlord shall suffer as a result of
Tenant's failure to pay such amounts is difficult to ascertain and said late
charge and interest are the best estimate of the damage which Landlord shall
suffer in the event of late payment.

                  3.3 Net Lease. Tenant acknowledges that the Rent shall be
absolutely net and carefree to the Landlord, except as set forth herein.
Landlord shall not be responsible for any costs, charges, expenses or outlays of
any nature or kind whatsoever arising from or relating to the Premises, except
as provided for herein. Tenant shall pay all such charges, impositions, costs
and expenses of every nature and kind to Landlord's complete exoneration.

4.                UTILITIES. Tenant shall pay all charges for heat, water, gas,
electricity and any other utilities used on the Premises directly to the utility
provider. Landlord shall not be liable to Tenant for interruption in or
curtailment of any utility service, nor shall any such interruption or
curtailment constitute constructive eviction or grounds for rental abatement. In
the event the Premises is not separately metered, Landlord shall have the
option, subject to Landlord's review and the terms of this Lease, to cause the
Premises to be separately metered at Tenant's cost and expense.

5.                TAXES.

                  5.1 Real Property Taxes. Tenant shall pay any and all of the
Real Property Taxes for the Premises to the relevant taxing authority on or
before the date due. Tenant shall provide Landlord with written evidence of such
payment of taxes concomitantly with the payment thereof.

                  5.2 Definition of Real Property Taxes. "Real Property Taxes"
shall be the sum of the following: all real property taxes, possessory interest
taxes, business or license taxes or fees, service payments in lieu of such taxes
or fees, annual or periodic license or use fees, excises, transit charges,
housing fund assessments, open space charges, childcare fees, school fees or any
other assessments, levies, fees or charges, general and special, ordinary and
extraordinary, unforeseen as well as foreseen (including fees "in-lieu" of any
such tax or assessment) which are assessed, levied, charged, confirmed or
imposed by any public authority upon the Project (or any real property
comprising any portion thereof) or its operations, together with all taxes,
assessments or other fees imposed by any public authority upon or measured by
any Rent or other charges payable hereunder, including any gross income tax or
excise tax levied by the local governmental authority, the federal government or
any other governmental body with respect to receipt of such rental, or upon,
with respect to or by reason of the development, possession, leasing, operation,
management, maintenance, alteration, repair, use or occupancy by Tenant of the
Premises or any portion thereof, or upon this transaction or any document to
which Tenant is a party creating or transferring an interest in the Premises,
together with any tax imposed in substitution, partially or totally, of any tax
previously included within the aforesaid definition or any additional tax the
nature of which was previously included within the aforesaid definition,
together with the costs and expenses (including attorneys fees) of challenging
any of the foregoing or seeking the reduction in or abatement, redemption or
return of any of the foregoing,



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but only to the extent of any such reduction, abatement, redemption or return.
Nothing contained in this Lease shall require Tenant to pay any franchise,
corporate, estate or inheritance tax of Landlord, or any income, profits or
revenue tax or charge upon the net income of Landlord.

                  5.3 Personal Property Taxes. Prior to delinquency, Tenant
shall pay all taxes and assessments levied upon trade fixtures, alterations,
additions, improvements, inventories and other personal property located and/or
installed on the Property by Tenant; and Tenant shall provide Landlord copies of
receipts for payment of all such taxes and assessments. To the extent any such
taxes are not separately assessed or billed to Tenant, Tenant shall pay the
amount thereof as invoiced by Landlord.

6.                INSURANCE.

                  6.1 Landlord. Landlord shall, at Tenant's expense, obtain and
keep in force at all times the following insurance:

                      6.1.1. Building. Insurance insuring the Building and the
Landlord's interest in any betterments and improvements against fire and
extended coverage (including "all risk" coverage, earthquake/volcanic action,
flood and/or surface water insurance) for the full replacement cost of the
Building, with deductibles and the form and endorsements of such coverage as is
required by any synthetic lender of Landlord with an interest in the Building at
the time, together with rental value insurance against loss of Rent in an amount
equal to the amount of Rent for a period of at least twelve (12) months
commencing on the date of loss. Tenant shall reimburse Landlord for the cost of
such insurance for such period of time that is consistent with the Term of this
Lease within ten (10) business days of receipt of request therefor, provided
such request is accompanied by related invoices therefor.

                  6.2 Tenant. Tenant shall, at Tenant's expense, obtain and keep
in force at all times the following insurance:

                      6.2.1. Commercial General Liability Insurance (Occurrence
Form). A policy of commercial general liability insurance (occurrence form)
having a combined single limit of not less than Two Million Dollars ($2,000,000)
per occurrence providing coverage for, among other things, blanket contractual
liability, premises, products/completed operations and personal and advertising
injury coverage, with deletion of the exclusion for explosion, collapse or
underground hazard, if applicable, and, if necessary, Tenant shall provide for
restoration of the aggregate limit;

                      6.2.2. Automobile Liability Insurance. Comprehensive
automobile liability insurance having a combined single limit of not less than
Two Million Dollars ($2,000,000) per occurrence and insuring Tenant against
liability for claims arising out of ownership, maintenance, or use of any owned,
hired or non-owned automobiles;

                      6.2.3. Workers' Compensation and Employer's Liability
Insurance. Workers' compensation insurance having limits not less than those
required by state statute and federal statute, if applicable, and covering all
persons employed by Tenant in the conduct of its operations on the Premises
(including the all states endorsement and, if applicable, the volunteers



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endorsement), together with employer's liability insurance coverage in the
amount of at least One Million Dollars ($1,000,000); and

                      6.2.4. Property Insurance. "All risk" property insurance
including boiler and machinery comprehensive form, if applicable, covering
damage to or loss of any personal property, fixtures and equipment, including
electronic data processing equipment, of Tenant (and coverage for the full
replacement cost thereof including business interruption of Tenant) ("Tenant's
Property").

                  6.3 General.

                      6.3.2. Insurance Companies. Insurance required to be
maintained by Tenant shall be written by companies licensed to do business in
the state in which the Premises are located and having a "General Policyholders
Rating" of at least A (or such higher rating as may be required by a lender
having a lien on the Premises) as set forth in the most current issue of "Best's
Insurance Guide."

                      6.3.2. Certificates of Insurance. Tenant shall deliver to
Landlord certificates of insurance for all insurance required to be maintained
by Tenant prior to the date of possession of the Premises. Tenant shall, at
least ten (10) days prior to expiration of the policy, furnish Landlord with
certificates of renewal or "binders" thereof. Each certificate shall expressly
provide that such policies shall not be cancelable or otherwise subject to
modification except after sixty (60) days prior written notice to the parties
named as additional insureds in this Lease (except in the case of cancellation
for nonpayment of premium in which case cancellation shall not take effect until
at least (10) days' notice has been given to Landlord). If Tenant fails to
maintain any insurance required in this Lease, Tenant shall be liable for all
losses and cost resulting from said failure.

                      6.3.3. Additional Insureds. Landlord and any property
management company of Landlord for the Premises shall be included as additional
insureds, to the extent that the Tenant has an obligation under Section 6.4,
under all of the policies required by Section 6.2.1. The policies required under
Section 6.2.1 shall provide for severability of interest.

                      6.3.4. Primary Coverage. All insurance to be maintained by
Tenant shall, except for workers' compensation and employer's liability
insurance, be primary, without right of contribution from insurance of Landlord.
The limits of insurance maintained by Tenant shall not limit Tenant's liability
under this Lease.

                      6.3.5. Waiver of Subrogation. Landlord and Tenant each
waives any right to recover against the other for claims for damages to its
property covered by insurance. This provision is intended to waive fully, and
for the benefit of Landlord and Tenant, any rights and/or claims which might
give rise to a right of subrogation in favor of any insurance carrier.

                  6.4 Indemnity. Tenant shall indemnify, defend by counsel
satisfactory to Landlord, and hold harmless Landlord from and against any and
all claims arising from (i) Tenant's use of the Premises, the conduct of
Tenant's business or any activity, work or things done, permitted or suffered by
Tenant in or about the Premises, the Building or elsewhere and (ii) any breach
or default in the performance of any obligation on Tenant's part to be performed
under the terms of



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this Lease, arising from any negligence of Tenant or any of Tenant's agents,
contractors or employees, including all costs, attorneys' fees, expenses and
liabilities incurred in the defense of any such claim or any action or
proceeding brought thereon. Tenant, as a material part of the consideration to
Landlord, hereby assumes all risk of damage to property or injury to persons in,
upon or about the Premises or the Building arising from any cause; and Tenant
hereby waives all claims in respect thereof against Landlord except to the
extent such claims are caused by Landlord's gross negligence or willful
misconduct.

                  6.5 Exemption of Landlord from Liability. Tenant hereby agrees
that Landlord shall not be liable for injury to Tenant's business or any loss of
income therefrom or for damage to the property of Tenant, Tenant's employees,
invitees, customers or any other person in or about the Premises or the
Building, nor shall Landlord be liable for injury to the person of Tenant,
Tenant's employees, agents or contractors, whether such damage or injury is
caused by fire, steam, electricity, gas, water or rain, or from the breakage,
leakage or other defects of sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures, or from any other cause, whether said damage
or injury results from conditions arising upon the Premises, the Building or
from other sources or places, and regardless of whether the cause of such damage
or injury or the means of repairing the same is inaccessible to Tenant. Landlord
shall not be liable for any damages arising from any act or neglect of any other
tenant, if any, of the Building.

7.                REPAIRS AND MAINTENANCE.

                  7.1. Tenant. Tenant shall keep and maintain any and all
portions of the Premises and the Building, including structural portions
thereof, floors and floor coverings, interior plumbing, HVAC and other building
system equipment, electrical wiring, fixtures and equipment in good repair and
in a clean and safe condition, and repair and/or replace any and all of the
foregoing in a good and workmanlike manner. Without limiting the foregoing,
Tenant shall, at Tenant's sole expense, (a) immediately replace all broken glass
in the Premises with glass equal to or in excess of the specification and
quality of the original glass; and (b) repair any area damaged by Tenant,
Tenant's agents, employees, invitees and visitors, including any damage caused
by any roof penetration, whether or not such roof penetration was approved by
Landlord.

                  7.2. Landlord. Landlord shall have no obligation whatsoever to
maintain any portion of the Building or Premises. Tenant waives any right to
repair at the expense of Landlord under any applicable governmental laws,
ordinances, statutes, orders or regulations now or hereafter in effect
respecting the Premises.

8.                ALTERATIONS.

                  8.1. Trade Fixtures; Alterations. Tenant may install necessary
trade fixtures, equipment and furniture in the Building, provided that such
items are installed and are removable without structural damage to the Building.
Tenant shall not make, or allow to be made, any alterations or physical
additions in, about or to the Premises that affect the structural aspects of the
Building, the Building roof or Building foundation without obtaining the prior
written consent of Landlord, which consent shall not be unreasonably withheld.
Tenant shall reimburse Landlord for all costs which Landlord may incur in
connection with granting approval to Tenant for any such alterations and
additions, including any costs or expenses which Landlord may



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incur in electing to have outside architects and engineers review said matters.
If a Notice of Completion is required for such work, Tenant shall file it and
provide Landlord with a copy. Tenant shall provide Landlord with a set of
"as-built" drawings for any such work.

                  8.2. Damage; Removal. Tenant assumes the risk of damage to any
of Tenant's fixtures, equipment, furniture or alterations. Tenant shall repair
all damage to the Premises and/or Building caused by the installation or removal
of such items. Upon the termination of this Lease, Tenant shall remove any or
all alterations, additions, improvements and partitions made or installed by
Tenant and restore the Premises to their condition existing prior to the
construction of any such items; provided, however, Landlord may permit, upon
written notice to Tenant (to the extent requested to do so by Tenant at the time
notice thereof is given), any such items designated by Landlord to remain on the
Premises, in which event they shall be and become the property of Landlord upon
the termination of this Lease. All such removals and restoration shall be
accomplished in a good and workmanlike manner and so as not to cause any damage
to the Premises, the Building or the Project whatsoever.

                  8.3. Liens. Tenant shall promptly pay and discharge all claims
for labor performed, supplies furnished and services rendered at the request of
Tenant and shall keep the Premises free of all mechanics' and materialmen's
liens in connection therewith. Tenant shall provide at least ten (10) days prior
written notice to Landlord before any labor is performed, supplies furnished or
services rendered on or at the Premises and Landlord shall have the right to
post on the Premises notices of non-responsibility. If any lien is filed,
Landlord may take such action as may be necessary to remove such lien and Tenant
shall pay Landlord such amounts expended by Landlord together with interest
thereon at the Applicable Interest Rate from the date of expenditure.

9.                USE.

                  The Premises shall be used only for the Permitted Uses and for
no other uses and otherwise consistent with any applicable governmental laws,
ordinances, statutes, orders and regulations and any declaration of covenants,
conditions and restrictions or any supplement thereto which has been recorded in
any official or public records with respect to the Project or any portion
thereof. Tenant shall comply with all applicable governmental laws, ordinances,
and statutes applicable to the Premises or Building. Tenant shall not commit
waste, overload the floors or structure of the Building, subject the Premises or
the Project to any use which would damage the same or raise or violate any
insurance coverage, permit any unreasonable odors, smoke, dust, gas, substances,
noise or vibrations to emanate from the Premises, take any action which would
constitute a nuisance or would disturb, obstruct or endanger any other tenants,
take any action which would abrogate any warranties, or use or allow the
Premises to be used for any unlawful purpose. Tenant shall not use any parking
spaces for the Project other than the parking spaces located on the Premises.
Landlord shall not be responsible for non-compliance by any other tenant or
occupant with any of the rules or regulations or any other terms or provisions
of such tenant's or occupant's lease. Tenant shall promptly comply with the
reasonable requirements of any board of fire insurance underwriters or other
similar body now or hereafter constituted.



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<PAGE>   11

10.               ENVIRONMENTAL MATTERS.

                  10.1. Hazardous Materials. Tenant shall not cause, or allow
any of Tenant's employees, agents, customers, visitors, invitees, licensees,
contractors, assignees or subtenants (collectively, "Tenant's Parties") to cause
or permit, any Hazardous Materials to be brought upon, stored, manufactured,
generated, blended, handled, recycled, treated, disposed or used on, under or
about the Premises, the Building or the Project, except for routine office and
janitorial supplies and the Hazardous Materials listed on Schedule 1 hereto in
usual and customary quantities stored, used and disposed of in accordance with
all applicable Environmental Laws. As used herein, "Hazardous Materials" means
any chemical, substance, material, controlled substance, waste or combination
thereof which is hazardous to human health or safety or to the environment due
to its radioactivity, ignitability, corrosivity, reactivity, explosivity,
toxicity, carcinogenicity, mutagenicity or other harmful or potentially harmful
properties or effects, including, without limitation, petroleum and petroleum
products, asbestos, radon, polychlorinated biphenyls (PCBs) and all of those
chemicals, substances, materials, controlled substances, wastes or combinations
thereof which are listed, defined or regulated in any manner by any
Environmental Law based upon, directly or indirectly, such properties or
effects. As used herein, "Environmental Laws" means any and all federal, state
or local environmental, health and/or safety-related laws, regulations,
standards, ordinances, rules, codes, orders, decrees, directives, guidelines,
permits or permit conditions, currently existing which are applicable to Tenant
or the Premises. Tenant and Tenant's Parties shall comply with all Environmental
Laws and promptly notify Landlord of the presence of any Hazardous Materials,
other than as permitted above, on the Premises or any violation of any
Environmental Law. Landlord shall have the right to inspect the Premises and to
conduct tests and investigations to determine whether Tenant is in compliance
with the foregoing provisions. If such tests indicate the presence of any
environmental condition, Tenant shall reimburse Landlord for the cost of
conducting such tests. The phrase "environmental condition" shall mean any
condition relating to any Hazardous Materials, including surface water,
groundwater, drinking water supply, land, surface or subsurface strata or the
ambient air and includes air, land and water pollutants, being present at the
Property in violation of Environmental Laws or in a manner which, in the
reasonable opinion of the Landlord's environmental consultant, is substantially
likely to cause health problems for occupants of the Premises or a future
violation of Environmental Law. In the event of any such environmental
condition, Tenant shall promptly take any and all steps necessary to rectify the
same or shall, at Tenant's election, reimburse Landlord, upon demand, for the
cost to Landlord of performing rectifying work. Upon the expiration or earlier
termination of this Lease, Tenant shall remove any and all Hazardous Materials
on, under or about the Premises.

                  10.2. Indemnification. Tenant shall indemnify, protect, defend
(by counsel acceptable to Landlord) and hold harmless Landlord and its partners,
directors, officers, employees, shareholders, lenders, agents, contractors and
each of their respective successors and assigns (individually and collectively,
"Indemnities") from and against any and all claims, judgments, causes of action,
damages, penalties, fines, taxes, costs, liabilities, losses and expenses
arising at any time during or after the Term as a result (directly or
indirectly) of or in connection with (a) Tenant and/or Tenant's Parties' breach
of any prohibition or provision of the preceding section, or (b) the presence of
Hazardous Materials on, under or about the Premises or other properties as a
result (directly or indirectly) of Tenant's and/or Tenant's Parties' activities,
or failure to act



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<PAGE>   12

when legally required to do so in connection with the Premises. This indemnity
shall include the cost of any required or necessary repair, cleanup or
detoxification, and the preparation of any closure or other required plans,
whether such action is required or necessary prior to or following the
termination of this Lease. The written consent by Landlord to the presence of
Hazardous Materials on, under or about the Premises shall not excuse Tenant from
Tenant's obligation of indemnification pursuant hereto. Tenant's obligations
pursuant to the foregoing indemnity shall survive the termination of this Lease.

11.               DAMAGE AND DESTRUCTION.

                  11.1. Casualty. If the Building should be damaged or destroyed
by fire or other casualty, Tenant shall give immediate written notice to
Landlord. Within thirty (30) days after receipt thereof, Landlord shall notify
Tenant whether such repairs can reasonably be made: (1) within thirty (30) days;
(2) in more than thirty (30) days but in less than ninety (90) days; or (3) in
more than ninety (90) days from the date of such notice.

                        11.1.1. Less Than 30 Days. If the Building should be
damaged only to such extent that rebuilding or repairs can be reasonably
completed within thirty (30) days, this Lease shall not terminate and, provided
that insurance proceeds are available to fully repair the damage, Landlord shall
repair the Building, except that Landlord shall not be required to rebuild,
repair or replace any alterations, partitions, fixtures, additions and other
improvements which may have been placed in, on or about the Building by or for
the benefit of Tenant. The Rent payable hereunder shall be abated
proportionately from the date Tenant vacates the Building only to the extent
rental abatement insurance proceeds are received by Landlord and the Building
are unfit for occupancy.

                        11.1.2. Greater Than 30 Days. If the Building should be
damaged only to such extent that rebuilding or repairs can be reasonably
completed in more than thirty (30) days but in less than ninety (90) days, then
Landlord shall have the option of: (1) terminating the Lease effective upon the
occurrence of such damage, in which event the Rent shall be abated from the date
Tenant vacates the Building; or (2) electing to repair the Building, provided
insurance proceeds are available to fully repair the damage (except that
Landlord shall not be required to rebuild, repair or replace any part of the
alterations, partitions, fixtures, additions and other improvements which may
have been placed in, on or about the Building by or for the benefit of Tenant).
The Rent payable hereunder shall be abated proportionately from the date Tenant
vacates the Building only to the extent rental abatement insurance proceeds are
received by Landlord and the Building is unfit for occupancy.

                        11.1.3. Greater Than 90 Days. If the Building should be
so damaged that rebuilding or repairs cannot be completed within ninety (90)
days, either Landlord or Tenant may terminate by giving written notice within
ten (10) days after notice from Landlord regarding the time period of repair;
and this Lease and the Rent shall be abated from the date Tenant vacates the
Building. In the event that neither party elects to terminate this Lease,
Landlord shall promptly commence and diligently prosecute to completion the
repairs to the Building , provided insurance proceeds are available to fully
repair the damage (except that Landlord shall not be required to rebuild, repair
or replace any alterations, partitions, fixtures, additions and other
improvements which may have been placed in, on or about the Building by or for
the benefit of



                                       8
<PAGE>   13

Tenant). During the time when Landlord is prosecuting such repairs to
completion, the Rent payable hereunder shall be abated proportionately from the
date Tenant vacates the Building only to the extent rental abatement insurance
proceeds are received by Landlord and only during the period that the Building
is unfit for occupancy.

                  11.2. Tenant's Fault. If any portion of the Building is
damaged resulting from the fault, negligence or breach of this Lease by Tenant
or any of Tenant's Parties, Rent shall not be diminished during the repair of
such damage and Tenant shall be liable to Landlord for the cost of the repair
caused thereby to the extent such cost is not covered by insurance proceeds.

                  11.3. Uninsured Casualty. In the event that any portion of the
Building is damaged and is not fully covered by insurance proceeds received by
Landlord or in the event that the holder of any indebtedness secured by the
Premises requires that the insurance proceeds be applied to such indebtedness,
then Tenant shall have the right to terminate this Lease by delivering written
notice of termination to Landlord within thirty (30) days after the date of
notice to Tenant of any such event. In the event that Tenant does not elect to
terminate this Lease, Landlord shall have the right to terminate this Lease by
delivering written notice to Tenant within thirty (30) days after such election
by Tenant or Tenant's failure to elect, as applicable, whereupon all rights and
obligations shall cease and terminate hereunder.

                  11.4. Waiver. With respect to any damage or destruction which
Landlord is obligated to repair or may elect to repair, Tenant waives all rights
to terminate this Lease pursuant to rights otherwise presently or hereafter
accorded by law.

12.               EMINENT DOMAIN.

                  12.1. Total Condemnation. If all of the Premises is condemned
by eminent domain, inversely condemned or sold in lieu of condemnation for any
public or quasi-public use or purpose ("Condemned"), this Lease shall terminate
as of the date of title vesting in such proceeding and Rent shall be adjusted to
the date of termination.

                  12.2. Partial Condemnation. If any portion of the Premises is
Condemned and such partial condemnation renders the Premises unusable for
Tenant's business, or if a substantial portion of the Building is Condemned,
this Lease shall terminate as of the date of title vesting or order of immediate
possession in such proceeding and Rent shall be adjusted to the date of
termination. If such partial condemnation does not render the Premises unusable
for the business of Tenant or less than a substantial portion of the Building is
Condemned, Landlord shall promptly restore the Premises to the extent of any
condemnation proceeds recovered by Landlord, excluding the portion thereof lost
in such condemnation, and this Lease shall continue in full force and effect
except that after the date of such title vesting Rent shall be adjusted, as
reasonably determined by Landlord.

                  12.3. Award. If the Premises are wholly or partially
Condemned, Landlord shall be entitled to the entire award paid for such
condemnation, and Tenant waives any claim to any part of the award from Landlord
or the condemning authority; provided that Tenant shall have the right to
recover from the condemning authority such compensation as may be separately
awarded



                                       9
<PAGE>   14

to Tenant in connection with costs in removing Tenant's merchandise, furniture,
fixtures, leasehold improvements and equipment to a new location.

                  12.4. Temporary Condemnation. In the event of a temporary
condemnation, this Lease shall remain in effect, Tenant shall continue to pay
Rent and Tenant shall receive any award made for such condemnation. If a
temporary condemnation remains in effect at the expiration or earlier
termination of this Lease, Tenant shall pay Landlord the reasonable cost of
performing any obligations required of Tenant with respect to the surrender of
the Premises. If a temporary condemnation is for a period which extends beyond
the Term, this Lease shall terminate as of the date of occupancy by the
condemning authority and any such award shall be distributed in accordance with
the preceding section.

13.               DEFAULT.

                  13.1. Events of Defaults. The occurrence of any of the
following events shall, at Landlord's option, constitute an "Event of Default":

                        13.1.1. Vacation or abandonment of the Premises for a
period of thirty (30) consecutive days, and Tenant waives any right to notice
Tenant may have under applicable law;

                        13.1.2. Failure to pay Rent on the date when due, the
failure continuing for a period of five (5) days after payment is due;

                        13.1.3. Failure to perform Tenant's covenants hereunder
(except default in the payment of Rent); provided, if such default is
susceptible of cure and Tenant has promptly commenced the cure of such default
and is diligently prosecuting such cure to completion, then the same must remain
uncured for thirty (30) days after written notice thereof from Landlord;

                        13.1.4. The making of a general assignment by Tenant for
the benefit of creditors, the filing of a voluntary petition by Tenant or the
filing of an involuntary petition by any of Tenant's creditors seeking the
rehabilitation, liquidation or reorganization of Tenant under any law relating
to bankruptcy, insolvency or other relief of debtors and, in the case of an
involuntary action, the failure to remove or discharge the same within sixty
(60) days of such filing, the appointment of a receiver or other custodian to
take possession of substantially all of Tenant's assets or this leasehold,
Tenant's insolvency or inability to pay Tenant's debts or failure generally to
pay Tenant's debts when due, any court entering a decree or order directing the
winding up or liquidation of Tenant or of substantially all of Tenant's assets,
Tenant taking any action toward the dissolution or winding up of Tenant's
affairs, the cessation or suspension of Tenant's use of the Premises, or the
attachment, execution or other judicial seizure of substantially all of Tenant's
assets or this leasehold;

                        13.1.5. The making of any material misrepresentation or
omission by Tenant in any materials delivered by or on behalf of Tenant to
Landlord pursuant to this Lease; or

                        13.1.6. A default by Tenant beyond any applicable notice
and cure period pursuant to the terms of any lease entered into between Landlord
and Tenant for space in the Project.



                                       10
<PAGE>   15

                  13.2. Remedies.

                        13.2.1. Termination. In the event of the occurrence of
any Event of Default, Landlord shall have the right to give a written
termination notice to Tenant and, on the date specified in such notice, this
Lease shall terminate unless on or before such date all arrears of Rent and all
other sums payable by Tenant under this Lease and all costs and expenses
incurred by or on behalf of Landlord hereunder shall have been paid by Tenant
and all other Events of Default at the time existing shall have been fully
remedied to the satisfaction of Landlord.

                                13.2.1.1. Repossession. Following termination,
without prejudice to other remedies Landlord may have, Landlord may (i)
peaceably re-enter the Premises upon voluntary surrender by Tenant or remove
Tenant therefrom and any other persons occupying the Premises, using such legal
proceedings as may be available; (ii) repossess the Premises or relet the
Premises or any part thereof for such term (which may be for a term extending
beyond the Term), at such rental and upon such other terms and conditions as
Landlord in Landlord's sole discretion shall determine, with the right to make
reasonable alterations and repairs to the Premises; and (iii) remove all
personal property therefrom.

                                13.2.1.2. Unpaid Rent. Landlord shall have all
the rights and remedies of a landlord provided by applicable law, including the
right to recover from Tenant: (a) the worth, at the time of award, of the unpaid
Rent that had been earned at the time of termination, (b) the worth, at the time
of award, of the amount by which the unpaid Rent that would have been earned
after the date of termination until the time of award exceeds the amount of loss
of rent that Tenant proves could have been reasonably avoided, (c) the worth, at
the time of award, of the amount by which the unpaid Rent for the balance of the
Term after the time of award exceeds the amount of the loss of rent that Tenant
proves could have been reasonably avoided, and (d) any other amount, and court
costs, necessary to compensate Landlord for all detriment proximately caused by
Tenant's default. The phrase "worth, at the time of award," as used in (a) and
(b) above, shall be computed at the greater of 10% per annum or 5% per annum
plus the federal discount rate on advances to member banks in effect at the
Federal Reserve Bank of San Francisco on the 25th day of the month preceding the
date of this Lease, and as used in (c) above, shall be computed by discounting
such amount at the discount rate of the Federal Reserve Bank of San Francisco at
the time of award plus 1%.

                        13.2.2. Continuation. Even though an Event of Default
may have occurred, this Lease shall continue in effect for so long as Landlord
does not terminate Tenant's right to possession; and Landlord may enforce all of
Landlord's rights and remedies under this Lease, including the right to recover
Rent as it becomes due, and Landlord, without terminating this Lease, may,
during the period Tenant is in default, enter the Premises and relet the same,
or any portion thereof, to third parties for Tenant's account and Tenant shall
be liable to Landlord for all costs Landlord incurs in reletting the Premises,
including, without limitation, brokers' commissions, expenses of remodeling the
Premises and like costs. Reletting may be for a period shorter or longer than
the remaining Term. Tenant shall continue to pay the Rent on the date the same
is due. No act by Landlord hereunder, including acts of maintenance,
preservation or efforts to lease the Premises or the appointment of a receiver
upon application of Landlord to protect Landlord's interest under this Lease,
shall terminate this Lease unless Landlord notifies Tenant that Landlord elects
to terminate this Lease. In the event that Landlord elects to relet the



                                       11
<PAGE>   16

Premises, the rent that Landlord receives from reletting shall be applied to the
payment of, first, any indebtedness from Tenant to Landlord other than Base Rent
and Additional Rent; second, all costs, including maintenance, incurred by
Landlord in reletting; and, third, Base Rent and Tenant's Share of Increases
under this Lease. After deducting the payments referred to above, any sum
remaining from the rental Landlord receives from reletting shall be held by
Landlord and applied in payment of future Rent as Rent becomes due under this
Lease. In no event shall Tenant be entitled to any excess rent received by
Landlord. If, on the date Rent is due under this Lease, the rent received from
the reletting is less than the Rent due on that date, Tenant shall pay to
Landlord, in addition to the remaining Rent due, all costs, including
maintenance, Landlord incurred in reletting that remain after applying the rent
received from reletting as provided hereinabove. So long as this Lease is not
terminated, Landlord shall have the right to remedy any default of Tenant, to
maintain or improve the Premises, to cause a receiver to be appointed to
administer the Premises and new or existing subleases and to add to the Rent
payable hereunder all of Landlord's reasonable costs in so doing, with interest
at the Applicable Interest Rate from the date of such expenditure.

                  13.3. Cumulative. Each right and remedy of Landlord provided
for herein or now or hereafter existing at law, in equity, by statute or
otherwise shall be cumulative and shall not preclude Landlord from exercising
any other rights or remedies provided for in this Lease or now or hereafter
existing at law or in equity, by statute or otherwise. No payment by Tenant of a
lesser amount than the Rent nor any endorsement on any check or letter
accompanying any check or payment as Rent shall be deemed an accord and
satisfaction of full payment of Rent; and Landlord may accept such payment
without prejudice to Landlord's right to recover the balance of such Rent or to
pursue other remedies.

14.               ASSIGNMENT AND SUBLETTING. Tenant shall not assign or sublet,
whether voluntarily or involuntarily or by operation of law, the Premises or any
part thereof without Landlord's prior written approval, which shall not be
unreasonably withheld. The merger of Tenant with any other entity or the
transfer of any controlling or managing ownership or beneficial interest in
Tenant shall constitute an assignment hereunder. If Tenant desires to assign
this Lease or sublet any or all of the Building, Tenant shall give Landlord
written notice forty-five (45) days prior to the anticipated effective date of
the assignment or sublease. Landlord shall then have a period of thirty (30)
days following receipt of such notice and all related documents and agreements
associated with the assignment or sublease, including without limitation, the
financial statements of any proposed assignee or subtenant, to notify Tenant in
writing that Landlord elects: (1) to permit Tenant to assign this Lease or
sublet such space, subject however to Landlord's prior written approval of the
proposed assignee or subtenant and of any related documents or agreements
associated with the assignment or sublease received by Landlord hereunder or
reasonably requested by Landlord; (2) to disapprove such proposed assignment or
subletting or (3) to terminate this Lease as of the date specified in Landlord's
notice thereof. If Landlord should fail to notify Tenant in writing of such
election, Landlord shall be deemed to have elected option (2). This Lease may
not be assigned by operation of law. Any purported assignment or subletting
contrary to the provisions hereof shall be void. If Tenant receives rent or
other consideration for any such transfer in excess of the Rent, or in case of
the sublease of a portion of the Premises, in excess of such Rent that is fairly
allocable to such portion, after appropriate adjustments to assure that all
other payments required hereunder are appropriately taken into account, Tenant
shall pay Landlord one hundred percent (100%) of the



                                       12
<PAGE>   17

difference between each such payment of rent or other consideration and the Rent
required hereunder. Landlord may, without waiving any rights or remedies,
collect rent from the assignee, subtenant or occupant and apply the net amount
collected to the Rent herein reserved and apportion any excess rent so collected
in accordance with the terms of the preceding sentence. Tenant shall continue to
be liable as a principal and not as a guarantor or surety to the same extent as
though no assignment or subletting had been made. Landlord may consent to
subsequent assignments or subletting of this Lease or amendments or
modifications to the Lease by assignees of Tenant without notifying Tenant or
any successor of Tenant and without obtaining their consent. No permitted
transfer shall be effective until there has been delivered to Landlord a
counterpart of the transfer instrument in which the transferee agrees to be and
remain jointly and severally liable with Tenant for the payment of Rent
pertaining to the space and for the performance of all the terms and provisions
of this Lease relating thereto arising on or after the date of the transfer.
Tenant shall not do any act which shall in any way encumber the title of
Landlord in and to the Premises, the Building or the Project.

15.               ESTOPPEL, ATTORNMENT AND SUBORDINATION.

                  15.1. Estoppel. Within ten (10) days after request by
Landlord, Tenant shall deliver an estoppel certificate duly executed (and
acknowledged if required by any lender), in the form attached hereto as Exhibit
B, to any proposed mortgagee, purchaser or Landlord. Tenant's failure to deliver
said statement in such time period shall be conclusive upon Tenant that (a) this
Lease is in full force and effect, without modification except as may be
represented by Landlord; (b) there are no uncured defaults in Landlord's
performance and Tenant has no right of offset, counterclaim or deduction against
Rent hereunder; and (c) no more than one period's Base Rent has been paid in
advance. Landlord reserves the right to substitute a different form of estoppel
certificate upon the request of any proposed mortgagee or purchaser. If any
financier should require that this Lease be amended (other than in the
description of the Premises, the Term, the Permitted Use, the Rent or as will
substantially, materially and adversely affect the rights of Tenant), Landlord
shall give written notice thereof to Tenant, which notice shall be accompanied
by a Lease supplement embodying such amendments. Tenant shall, within ten (10)
days after the receipt of Landlord's notice, execute the tendered Lease
supplement.

                  15.2. Attornment. In the event of a foreclosure proceeding,
the exercise of the power of sale under any mortgage or deed of trust or the
termination of a ground lease, Tenant shall, if requested, attorn to the
purchaser thereupon and recognize such purchaser as Landlord under this Lease;
provided, however, Tenant's obligation to attorn to such purchaser shall be
conditioned upon Tenant's receipt of a non-disturbance agreement.

                  15.3. Subordination. This Lease shall be subject and
subordinate to all ground leases and the lien of all mortgages and deeds of
trust which now or hereafter affect the Premises or the Project or Landlord's
interest therein, or on or against all such ground leases, and all amendments
thereto, all without the necessity of Tenant's executing further instruments to
effect such subordination. If requested, Tenant shall execute whatever
documentation may be required to further effect the provisions of this
paragraph.



                                       13
<PAGE>   18

16.               MISCELLANEOUS.

                  16.1. General.

                        16.1.1. Entire Agreement. This Lease sets forth all the
agreements between Landlord and Tenant concerning the Premises; and there are no
agreements either oral or written other than as set forth herein.

                        16.1.2. Time of Essence. Time is of the essence of this
Lease.

                        16.1.3. Attorneys' Fees. In any action which either
party brings to enforce its rights hereunder, the unsuccessful party shall pay
all costs incurred by the prevailing party including reasonable attorneys' fees,
to be fixed by the court, and said costs and attorneys' fees shall be a part of
the judgment in said action.

                        16.1.4. Severable. If any provision of this Lease or the
application of any such provision shall be held by a court of competent
jurisdiction to be invalid, void or unenforceable to any extent, the remaining
provisions of this Lease and the application thereof shall remain in full force
and effect and shall not be affected, impaired or invalidated.

                        16.1.5. Law. This Lease shall be construed and enforced
in accordance with the laws of the state in which the Premises are located.

                        16.1.6. No Option. Submission of this Lease to Tenant
for examination or negotiation does not constitute an option to lease, offer to
lease or a reservation of, or option for, the Premises; and this document shall
become effective and binding only upon the execution and delivery hereof by
Landlord and Tenant.

                        16.1.7. Successors and Assigns. This Lease shall be
binding upon and inure to the benefit of the successors and assigns of Landlord
and, to the extent assignment is approved by Landlord, Tenant.

                        16.1.8. Third Party Beneficiaries. Nothing herein is
intended to create any third party benefit.

                        16.1.9. Memorandum of Lease. Tenant shall not record
this Lease or a short form memorandum hereof without Landlord's prior written
consent.

                        16.1.10. Agency, Partnership or Joint Venture. Nothing
contained herein shall be deemed or construed by the parties hereto, nor by any
third party, as creating the relationship of principal and agent or of
partnership or of joint venture by the parties hereto, it being understood and
agreed that no provision contained in this Lease or any acts of the parties
hereto shall be deemed to create any relationship other than the relationship of
landlord and tenant.

                        16.1.11. Merger. The voluntary or other surrender of
this Lease by Tenant or a mutual cancellation thereof or a termination by
Landlord shall not work a merger and shall, at the option of Landlord, terminate
all or any existing subtenancies or may, at the option of Landlord, operate as
an assignment to Landlord of any or all of such subtenancies.



                                       14
<PAGE>   19

                  16.2. Signs. All signs and graphics of every kind visible in
or from public view or corridors, or the exterior of the Building or Premises
shall be subject to Landlord's prior written approval and shall be subject to
any applicable governmental laws, ordinances, and regulations and in compliance
with Landlord's signage program. Tenant shall remove all such signs and graphics
prior to the termination of this Lease. Such installations and removals shall be
made in such manner as to avoid injury or defacement of the Premises; and Tenant
shall repair any injury or defacement, including without limitation,
discoloration caused by such installation or removal.

                  16.3. Waiver. No waiver of any default or breach hereunder
shall be implied from any omission to take action on account thereof,
notwithstanding any custom and practice or course of dealing, and no waiver
shall affect any default other than the default specified in the waiver and then
said waiver shall be operative only for the time and to the extent therein
stated. Waivers of any covenant shall not be construed as a waiver of any
subsequent breach of the same. No waiver by either party of any provision under
this Lease shall be effective unless in writing and signed by such party.

                  16.4. Financial Statements. Tenant shall provide to any
lender, purchaser or Landlord, within ten (10) days after request, a current,
accurate, certified financial statement for Tenant and Tenant's business
prepared under generally accepted accounting principles consistently applied and
such other certified financial information or tax returns as may be reasonably
required by Landlord, purchaser or any lender of either.

                  16.5. Limitation of Liability. The obligations of Landlord
under this Lease are not personal obligations of the individual partners,
directors, officers, shareholders, agents or employees of Landlord; and Tenant
shall look solely to the Building for satisfaction of any liability and shall
not look to other assets of Landlord nor seek recourse against the assets of the
individual partners, directors, officers, shareholders, agents or employees of
Landlord. Whenever Landlord transfers its interest, Landlord shall be
automatically released from further performance under this Lease and from all
further liabilities and expenses hereunder and the transferee of Landlord's
interest shall assume all liabilities and obligations of Landlord hereunder from
the date of such transfer.

                  16.6. Notices. All notices to be given hereunder shall be in
writing and mailed postage prepaid by certified or registered mail, return
receipt requested, or delivered by personal or courier delivery, or sent by
facsimile (immediately followed by one of the preceding methods), to Landlord's
Address and Tenant's Address, or to such other place as Landlord or Tenant may
designate in a written notice given to the other party. Notices shall be deemed
served upon the earlier of receipt or three (3) days after the date of mailing.

                  16.7. Brokerage Commission. Tenant warrants to Landlord that
Tenant's sole contact with Landlord or with the Premises in connection with this
transaction has been directly with Landlord, and that no broker or finder can
properly claim a right to a commission or a finder's fee based upon contacts
between the claimant and Tenant. Tenant and Landlord, respectively, shall each
indemnify, defend by counsel acceptable to the other, protect and hold each
other harmless from and against any loss, cost or expense, including, but not
limited to, attorneys' fees and costs, resulting from any claim for a fee or
commission by any broker or finder in connection with the Premises and this
Lease.



                                       15
<PAGE>   20

                  16.8. Authorization. Tenant shall furnish to Landlord, within
ten (10) days after written request, evidence satisfactory to Landlord that the
person who executed this Lease on behalf of Tenant was duly authorized to do so.
Each individual executing this Lease on behalf of Tenant represents and warrants
that he or she is duly authorized to execute and deliver this Lease on behalf of
Tenant and that such execution is binding upon Tenant.

                  16.9. Holding Over; Surrender.

                        16.9.1. If Tenant holds over the Premises or any part
thereof after expiration or the earlier termination of the Term, such holding
over shall constitute a month-to-month tenancy, at a rent equal to the Base Rent
in effect immediately prior to such holding over plus one hundred percent (100%)
thereof. This paragraph shall not be construed as Landlord's permission for
Tenant to hold over. Acceptance of Rent by Landlord following expiration or
termination shall not constitute a renewal of this Lease. Without limiting the
foregoing, if Tenant holds over the Premises or any part thereof after
expiration or the earlier termination of the Term, Tenant shall indemnify,
defend, protect and hold Landlord harmless from any and all claims (including
claims of succeeding tenants), causes of action, expenses (including reasonable
attorneys' fees), liabilities and lawsuits resulting from such a holdover.

                        16.9.2. Upon the termination of this Lease or Tenant's
right to possession of the Premises, Tenant will surrender the Premises,
together with all keys, in good condition and repair, reasonable wear and tear
excepted. Conditions existing because of Tenant's failure to perform
maintenance, repairs or replacements shall not be deemed "reasonable wear and
tear."

                  16.10. Joint and Several. If Tenant consists of more than one
person, the obligation of all such persons shall be joint and several.

                  16.11. Covenants and Conditions. Each provision to be
performed by Tenant hereunder shall be deemed to be both a covenant and a
condition.

                  16.12. Addenda. The Addenda attached hereto, if any, and
identified with this Lease and initialed by the parties hereto are incorporated
herein by this reference as if fully set forth herein.



                                       16
<PAGE>   21

                  IN WITNESS WHEREOF, the parties have executed this Lease as of
the date set forth above.




                                        "Landlord"

                                        NETWORK APPLIANCE, INC.
                                        a California corporation



                                        By:  ___________________________________
                                        Its: ___________________________________



                                        "Tenant"

                                        TRW INC., an Ohio corporation



                                        By:  ___________________________________
                                        Its: ___________________________________



                                       17
<PAGE>   22

                                    EXHIBIT A

                                    PREMISES




                                       1
<PAGE>   23

                                    EXHIBIT B

                              ESTOPPEL CERTIFICATE

______________________
______________________
______________________
______________________


                  Re:  Lease dated _______________, 19___ ("Lease") by and
                       between ________________________________ ("Landlord") and
                       ______________________________ ("Tenant").

Gentlemen:

                  Reference is made to the above-described Lease in which the
undersigned is the Tenant. We understand that you are entering into a
transaction with the Landlord which relates to, among other things, this Lease;
and we hereby, as a material inducement for you to enter into such transaction
with Landlord, represent that:

                  1. A true and correct copy of the Lease is attached hereto as
Exhibit 1.

                  2. There are no modifications, amendments, supplements,
arrangements, side letters or understandings, oral or written, of any sort,
modifying, amending, altering, supplementing or changing the terms of the Lease
except as follows: .

                  3. The Lease is in full force and effect, and the Lease has
been duly executed and delivered by, and is a binding obligation of, the Tenant
as set forth therein.

                  4. The undersigned acknowledges (a) that rent on the Lease has
been paid up to and including _______________, 19___, (b) that monthly rent
during the __________ (____) years of the term of the Lease is
____________________ Dollars ($____________) per month and (c) that rent has not
been paid for any period after _______________, 19___, and shall not be paid for
a period in excess of one (1) month in advance.

                  5. The improvements on the Premises are free from defects in
design, materials and workmanship; and the improvements meet all governmental
requirements, including, but not limited to, zoning and environmental
requirements.



                                       1
<PAGE>   24

                  6. The Lease is not in default, and Landlord has performed the
obligations required to be performed by Landlord under the terms thereof through
the date hereof.

Dated:  _______________, 19___


                                        Very truly yours,

                                        "Tenant"


                                        _____________________________________, a
                                        ________________________________________


                                        By:  ___________________________________
                                        Its: ___________________________________



                                       2
<PAGE>   25


                                   SCHEDULE 1

                               HAZARDOUS MATERIALS




                                       1