<PAGE>

                                                                   EXHIBIT 10.11

                                 OFFICE LEASE

                                SJ PLAZA, LLC,
                     A Delaware limited liability company,
                                  As Landlord

                                      And

                             BLAZE SOFTWARE, INC.,
                           A California corporation,
                                   As Tenant

                        For Leased Premises located at
    Suite 800 and Suite 900, 150 Almaden Blvd., San Jose, California 95113
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                               TABLE OF CONTENTS
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<S>                                                                       <C>
ARTICLE 1      SALIENT LEASE TERMS......................................    1
ARTICLE 2      ADDITIONAL DEFINITIONS...................................    3
ARTICLE 3      PREMISES AND COMMON AREAS................................    8
ARTICLE 4      TERM AND POSSESSION......................................   10
ARTICLE 5      MINIMUM MONTHLY RENT.....................................   11
ARTICLE 6      ADDITIONAL RENT..........................................   11
ARTICLE 7      ACCORD AND SATISFACTION..................................   13
ARTICLE 8      SECURITY DEPOSIT.........................................   13
ARTICLE 9      USE......................................................   14
ARTICLE 10     COMPLIANCE WITH LAWS AND REGULATIONS.....................   14
ARTICLE 11     SERVICE AND EQUIPMENT....................................   16
ARTICLE 12     ALTERATIONS..............................................   18
ARTICLE 13     PROPERTY INSURANCE.......................................   20
ARTICLE 14     INDEMNIFICATION, WAIVER OF CLAIMS AND SUBROGATION........   21
ARTICLE 15     LIABILITY INSURANCE......................................   22
ARTICLE 16     INSURANCE POLICY REQUIREMENTS & INSURANCE DEFAULTS.......   22
ARTICLE 17     FORFEITURE OF PROPERTY...................................   23
ARTICLE 18     MAINTENANCE AND REPAIRS..................................   23
ARTICLE 19     DESTRUCTION..............................................   24
ARTICLE 20     CONDEMNATION.............................................   25
ARTICLE 21     ASSIGNMENT AND SUBLETTING................................   26
ARTICLE 22     ENTRY BY LESSOR..........................................   29
ARTICLE 23     SIGNS....................................................   29
ARTICLE 25     REMEDIES UPON DEFAULT....................................   30
ARTICLE 26     BANKRUPTCY...............................................   32
ARTICLE 27     SURRENDER OF LEASE.......................................   33
ARTICLE 28     LANDLORD'S EXCULPATION...................................   33
ARTICLE 29     ATTORNEYS' FEES..........................................   33
ARTICLE 30     NOTICES..................................................   34
ARTICLE 31     SUBORDINATION AND FINANCING PROVISIONS...................   34
ARTICLE 32     ESTOPPEL CERTIFICATES....................................   35
ARTICLE 33     MISCELLANEOUS PROVISIONS.................................   35
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                                 OFFICE LEASE

     THIS OFFICE LEASE ("Lease") is entered and dated for reference purposes
only as November 12, 1999, by and between "Landlord" and "Tenant" (as such terms
are defined below).

                         ARTICLE 1 SALIENT LEASE TERMS

     In addition to the terms defined throughout this Lease, the following
salient terms shall have the following meanings when referred to in this Lease:

1.1  Rent Payment        SJ PLAZA, LLC
     Address:            100 Park Center Plaza, Suite 425
                         San Jose, CA 95113

1.2  "Landlord"          SJ Plaza, LLC,
     and                 c/o Divco West Group, LLC
     Notice              100 Park Center Plaza, Suite 425
     Address:            San Jose, CA 95113
                         Attn.: Property Manager

                         With a copy to: Divco West Group, LLC
                                         150 Almaden Blvd., Suite 700
                                         San Jose, CA 95113
                                         Attention: Asset Manager

1.3  "Tenant"            BLAZE SOFTWARE, INC.
     and                 150 Almaden Blvd., Suite 800
     Notice              San Jose, CA
     Address:            Attn: Chief Financial officer

1.4  "Leased             Approximately 27,586 square feet of Rentable Area
     Premises:"          (hereinafter defined), Premises:" as outlined in
                         Exhibit B attached hereto, located in Suites 800 and
                         ---------
                         900 in the Building. The foregoing square footage for
                         the Rentable Area of the Leased Premises shall be
                         deemed the actual square footage for the Rentable Area
                         of Leased Premises.

1.5  "Building:"         That building located at 150 Almaden Blvd., San Jose,
                         California, containing approximately 201,748 square
                         feet of Rentable Area, which shall be deemed the actual
                         square footage of Rentable Area in the Building.

1.6  "Complex:"          Park Center Plaza, consisting of the Building and those
                         certain office buildings located at Park Center Plaza,
                         San Jose, California, and the Common Areas (hereinafter
                         defined) together with the parcel or parcels in common
                         ownership therewith and/or contiguous thereto, as
                         outlined in Exhibit A attached hereto.
                                     ---------

1.7  Estimated
     Commencement
     Date:               February 1, 2000 ("Estimated Commencement Date")

1.8  "Term:"             Sixty (60) months following the Commencement Date, plus
                         any partial month for the month in which the
                         Commencement Date occurs if the Commencement occurs on
                         other than the first day of a calendar month. If the
                         Commencement Date is other than the first

                                       1
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                         day of a calendar month, the first month shall include
                         the remainder of the calendar month in which the
                         Commencement Date occurs plus the first full calendar
                         month thereafter, and minimum monthly rent for such
                         first month shall include the full monthly rent for the
                         first full calendar month plus monthly rent for the
                         partial month in which the Commencement Date occurs
                         prorated on a daily basis at the monthly rent provided
                         for the first calendar month.

1.9   "Minimum
      Monthly Rent:"          (A)  Months        Minimum Monthly Rent
                                   ------        --------------------
                                   1 - 12        $ 86,895.90
                                   13 - 24       $ 90,371.74
                                   25 - 36       $ 93,986.61
                                   37 - 48       $ 97,746.07
                                   49 - 60       $101,655.91

                             (B)  Advance Rent:  $86,895.90

1.10  "Base Year
      Costs:"                The actual costs in calendar year 2000 for Base
                             Operating Costs, Base Taxes and Base Insurance.

1.11  "Security Deposit:"    $434,480.00, which may be in the form of a Letter
                             of Credit as provided in Addendum No. 1 attached
                             hereto.

1.12  "Permitted Use:"       The Leased Premises shall be used solely for
                             engineering offices and uses incidental thereto and
                             general office use, but for no other use.

1.13  Proportionate
      Share:                 Tenant's initial Proportionate Share is 13.67%
                             based on the ratio that the Rentable Area of the
                             Leased Premises (i.e., 27,586 square feet) bears to
                             the Rentable Area of the Building (i.e., 201,748
                             square feet).

1.14  Declaration of
      Restrictions:          As set forth on Exhibit F attached hereto and
                                             ---------
                             incorporated herein.

1.15  "Broker:"              Colliers International representing Tenant and
                             Ritchie Commercial representing Landlord.

1.16  "Reciprocal Easement
      Agreement:"            That certain Grant of Reciprocal Easements and
                             Agreement for Maintenance dated as of September 22,
                             1970 and recorded in Book 9072 at Page 22 of the
                             official Records of Santa Clara County, California,
                             as amended.

1.17  Contents:              Included as part of this Lease are the following
                             Exhibits and addenda which are attached hereto and
                             incorporated herein by this reference:

                             Exhibits:     A - Plan of the Complex
                                           B - Floor Plan of the Leased Premises
                                           C - Work Letter for Construction
                                               Obligations
                                           D - Acknowledgment of Commencement
                                               Date
                                           E - Rules & Regulations
                                           F - Declaration of Restrictions

                                       2
<PAGE>

                                Addendum No. 1

                       ARTICLE 2 ADDITIONAL DEFINITIONS

     The terms defined in this Article 2 shall, for all purposes of this Lease
and all agreements supplemental hereto, have the meanings herein specified,
unless expressly stated otherwise.

     "Base Operating Costs" means the Operating Costs for the calendar year set
      --------------------
forth in Section 1.10 hereof.

     "Base Insurance" means the Insurance Costs for the calendar year set forth
      --------------
in Section 1.10 hereof.

     "Base Taxes" means the Taxes for the calendar year set forth in Section
      ----------
1.10 hereof.

     "Building" shall mean the structure which contains the Leased Premises.
      --------

     "Commencement Date" shall mean the earlier of (a) the date by which the
      -----------------
Leasehold Improvements to be constructed by Landlord pursuant to Exhibit C have
                                                                 ---------
been Substantially Completed (as defined in Exhibit C) if Landlord is obligated
                                            ---------
to construct any Leasehold Improvements, subject to "Tenant Delays" and "Force
Majeure Delays" (as such terms are defined in Exhibit C attached hereto), or (b)
                                              ---------
the date Tenant takes possession of the Leased Premises. However, if there is
any delay in Substantially Completing the Leasehold Improvements due to any
Tenant Delay, then such delay shall thereupon effect a postponement of the date
by which Landlord is obligated to Substantially Complete the Leasehold
Improvements; however, the Commencement Date shall be deemed the date the
Leasehold Improvements would have been completed but for the Tenant Delays.
Thus, the date for commencement of Rent and all additional rent shall not be
delayed by Tenant Delay.

     "Common Areas" shall mean all areas and facilities outside the Leased
      ------------
Premises within the exterior boundaries of the parcel of land containing the
Building of which the Leased Premises form a part, together with the exterior
plaza and access areas within the Complex, all as provided and designated by
Landlord from time to time for the general use and convenience of Tenant and of
other tenants of Landlord having the common use of such areas, and their
respective authorized representatives and invitees. Common Areas include,
without limitation, corridors, stairways, elevator shafts, janitor rooms in the
Building, the Park Center Plaza parking garage, the driveways and landscaped
areas in the Complex as generally outlined on Exhibit A attached hereto. Exhibit
A is tentative and Landlord reserves the right to make alterations thereto from
time to time.

     "Insurance Costs" shall mean all premiums and costs and expenses for all
      ---------------
policies of insurance which may be obtained by Landlord in its discretion for
(a) the Leased Premises, Building and the Common Areas of the Complex, or any
blanket policies which include the Building or Complex, coveting damage thereto
and loss of rents caused by fire and other perils Landlord elects to cover,
including, without limitation, coverage for earthquakes and floods, (b)
commercial general liability insurance for the benefit of Landlord and its
designees and (c) such other coverage Landlord elects to obtain for the Leased
Premises, Building or Common Areas of the Complex, including, without
limitation, coverage for environmental liability and losses. Notwithstanding
anything to the contrary, Landlord reserves the right to adjust the Base
Insurance Costs if such Base Insurance costs include coverages for perils not
required or elected to be insured by Landlord in the future.

     "Lease Year" means any calendar year, or portion thereof, following the
      ----------
commencement hereof, the whole or any part of which period is included within
the Term.

     "Leased Premises" shall mean the portion of space leased to Tenant
      ---------------
hereunder.

     "Leasehold Improvements" and "Tenant Improvements" shall mean the tenant
      ----------------------       -------------------
improvements, if any, to be constructed by Landlord pursuant to Exhibit C
                                                                ---------
attached hereto.

                                       3
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     "Operating Costs" means the total amounts paid or. payable, whether by
      ---------------
Landlord or others on behalf of Landlord, in connection with the ownership,
maintenance, repair, and operations of the Building and the Common Areas of the
Complex in accordance with Landlord's standard accounting procedures. Since the
Complex consists of multiple buildings, certain Operating Costs may pertain to a
particular building(s) and other Operating Costs to the Complex as a whole (such
as Operating Costs for the Common Areas of the Complex). Operating Costs
applicable to any particular building within the Complex shall be charged to the
building in question whose tenants shall be responsible for payment of their
respective proportionate shares in the pertinent building and other Operating
Costs applicable to the Complex (such as the Common Areas of the Complex) shall
be charged to each building in the Complex (including the Building) with the
tenants in each such building being responsible for paying their respective
proportionate shares in such building of such costs to the extent required under
the applicable leases. Landlord shall in good faith attempt to allocate such
Operating Costs to the buildings (including the Building) and such allocation
shall be binding on Tenant. Operating Costs shall include, but not be limited
to, the aggregate of the amount paid for:

               (1)  all fuel used in heating and air conditioning of the
Building;

               (2)  the amount paid or payable for all electricity furnished by
Landlord to the Common Areas of the Complex, which shall be allocated to each
building as provided above (other than electricity furnished to and paid for by
other tenants by reason of their extraordinary consumption of electricity and
that furnished to the any other building in the Complex for which the tenants of
such other building are responsible for such electrical costs);

               (3)  the cost of periodic relamping and reballasting of lighting
fixtures;

               (4)  the amount paid or payable for all hot and cold water (other
than that chargeable to Tenants by reason of their extraordinary consumption of
water and that furnished to any other building in the Complex for which the
tenants of such other building are responsible for such water costs);

               (5)  the amount paid or payable for all labor and/or wages and
other payments including cost to Landlord of workers' compensation and
disability insurance, payroll taxes, welfare and fringe benefits made to
janitors, caretakers, and other employees, contractors and subcontractors of
Landlord (including wages of the Building manager) involved in the management,
operation, maintenance and repair of the Complex;

               (6)  painting for exterior walls of the Building and the Common
Areas of the Complex; the total charges of any independent contractors employed
in the repair, care, operation, maintenance, and cleaning of the Building and
Common Areas of the Complex;

               (7)  the amount paid or payable for all supplies used in
connection with the operation, repair and maintenance of the Building and the
Common Areas of the Complex;

               (8)  the cost of window and exterior wall cleaning, telephone and
utility costs of the Building and Common Areas of the Complex;

               (9)  the cost of accounting services necessary to compute the
rents and charges payable by Tenants and keep the books of the Building and
Common Areas of the Complex;

               (10) fees for management, including, without limitation, office
rent, supplies, equipment, salaries, wages, bonuses and other compensation
(including fringe benefits, vacation, holidays and other paid absence benefits)
relating to employees of Landlord or its agents engaged in the management,
operation, repair, or maintenance of the Building and/or Common Areas of the
Complex;

                                       4
<PAGE>

               (11) fees for legal, accounting (including, without limitation,
any outside audit as Landlord may elect in its sole and absolute discretion),
inspection and consulting services incurred by Landlord in connection with
operation, repair or maintenance of the Building or Common Areas of the Complex;

               (12) the cost of operating, repairing and maintaining the
Building elevators;

               (13) the cost of porters, guards and other protection services;

               (14) the cost of establishing and maintaining the Building's
directory board;

               (15) payments for general maintenance and repairs to the plant
and equipment supplying climate control to the Building and Common Areas of the
Complex;

               (16) the cost of supplying all services pursuant to Article 11
hereof to the extent such services are not paid by individual tenants;

               (17) amortization of the costs, including repair and replacement,
of all maintenance and cleaning equipment and master utility meters and of the
costs incurred for repairing or replacing all other fixtures, equipment and
facilities serving or comprising the Building and Common Areas of the Complex
which by their nature require periodic or substantial repair or replacement, and
which are not charged fully in the year in which they are incurred, at rates on
the various items determined from time to time by Landlord in accordance with
sound accounting principles;

               (18) community association dues, assessments and charges and
property owners' association dues, assessments and charges which may be imposed
upon Landlord by virtue of any recorded instrument affecting title to the
Building;

               (19) all costs to upgrade, improve or change the utility,
efficiency or capacity of any utility or telecommunication system serving the
Building and the Common Areas of the Complex;

               (20) the repair and replacement, resurfacing and/or repaying of
any paved areas, curbs or gutters within the Building or Common Area's of the
Complex;

               (21) the repair and replacement of any equipment or facilities
serving or located within the Building or the Common Areas of the Complex,
except for the cost to construct any new structures; and

               (22) the cost of any capital repairs, improvements and
replacements made by the Landlord to the Building or Common Areas of the Complex
("Capital Costs"). However, certain Capital Costs shall be includable in
Operating Costs each year only to the extent of that fraction allocable to the
year in question calculated by amortizing such Capital Cost over the reasonably
useful life of the improvement resulting therefrom, as determined by Landlord in
its good faith discretion, with interest on the unamortized balance at the
higher of (i) ten percent (10%) per annum; or (ii) the interest rate as may have
been paid by Landlord for the funds borrowed for the purpose of performing the
work for which the Capital Costs have been expended, but in no event to exceed
the highest rate permissible by law. The Capital Costs subject to such
amortization procedure are restricted to the following two categories: (a) those
costs for capital improvements to the Building or Common Areas of the Complex of
a type which do not normally recur more frequently than every five (5) years in
the normal course of operation and maintenance of such facilities (specifically
excluding painting of all or a portion of the Complex); and (b) costs incurred
for the purpose of reducing other operating expenses or utility costs, from
which Tenant can expect a reasonable benefit, or that are required by
governmental law, ordinance, regulation or mandate, not applicable to the
Complex at the time of the original construction.

                                       5
<PAGE>

          Operating Costs shall not include any of the following:

               (a)  legal or accounting expenses incurred expressly for
     negotiating a lease with a particular tenant, or as a result of a default
     of a specific tenant;

               (b)  the cost to construct any tenant improvements for other
     tenants;

               (c)  any work to the extent paid for by insurance or condemnation
     proceeds actually collected by Landlord;

               (d)  the cost for Work to remove any asbestos or other hazardous
     material in the Building or the Common Areas of the Complex; provided,
     however if such work is due to any alteration by Tenant or otherwise caused
     by Tenant or any of its officers, directors, employees, agents or
     contractors, then Tenant shall be solely responsible for the cost of such
     work;

               (e)  leasing commission or other cost to put a tenant into the
     Complex;

               (f)  interest on debt or amortization payments on mortgages or
     deeds of trust, ground lease payment or other debt for borrowed money;

               (g)  the cost for repairs resulting from any structural defect in
     the original design or construction of the Building or Common Areas of the
     Complex;

               (h)  the cost for repairs to the six story parking garage in
     located at the 185 Building (as defined in the definition of Real Estate
     Taxes) or to the main parking garage at the Complex; and

               (i)  the cost to construct any additional buildings or structures
     to the Common Areas of the Complex or to construct additional improvements
     to substantially expand the nature and quality of the improvements in the
     Common Areas other than when reasonably determined by Landlord to be
     necessary or desirable for the continued maintenance or operation of the
     Building and all Common Areas.

               In no event should Landlord account for, through inclusion in
     Operating Costs and direct payment from any tenant or third party, more
     than 100% of any item.

     "Proportionate Share" or "Pro Rata Percent" shall be that fraction
      -------------------      ----------------
(converted to a percentage) the numerator of which is the Rentable Area
(hereinafter defined) of the Leased Premises and the denominator of which is the
Rentable Area of the Building. Tenant's Proportionate Share as of the
commencement of the term hereof is specified in Section 1.13. Said Proportionate
Share shall be recalculated by Landlord as may be required effective as at the
commencement of any period to which the calculation is applicable in this Lease.
Notwithstanding the preceding provisions of this Section, Tenant's Proportionate
Share as to certain expenses may be calculated differently to yield a higher
percentage share for Tenant as to certain expenses in the event Landlord permits
other tenants in the Building to directly incur such expenses rather than have
Landlord incur the expense in common for the Building (such as, by way of
illustration, wherein a tenant performs its own janitorial services). In such
case Tenant's proportionate share of the applicable expense shall be calculated
as having as its denominator the Rentable Area of all floors rentable to tenants
in the Building less the Rentable Area of tenants who have incurred such expense
directly. In any case in which Tenant, with Landlord's consent, incurs such
expenses directly, Tenant's proportionate share will be calculated specially so
that expenses of the same character which are incurred by Landlord for the
benefit of other tenants in the Building shall not be prorated to Tenant.
Nothing herein shall imply that Landlord will permit Tenant or any other tenant
of the Building to incur any Operating Costs. Any such permission shall be in
the sole discretion of the Landlord, which Landlord may grant or withhold in its
arbitrary judgment.

                                       6
<PAGE>

     "Real Estate Taxes" or "Taxes" shall mean and include all general and
      -----------------      -----
special taxes, assessments, fees of every kind and nature, duties and levies,
charged and levied upon or assessed by any governmental authority against the
parcel containing the Building and all other improvements on such parcel,
including the various estates in such parcel and the Building and improvements
thereon, any leasehold improvements, fixtures, installations, additions and
equipment, whether owned by Landlord or Tenant or any other tenant; except that
it shall exclude any taxes of the kind covered by Section 6.1 hereof to the
extent Landlord is reimbursed therefor by any tenant in the Building. Real
Estate Taxes shall also include the reasonable cost to Landlord of contesting
the amount, validity, or the applicability of any Taxes mentioned in this
Section but only to the extent of the savings. Further included in the
definition of Taxes herein shall be general and special assessments, license
fees, commercial rental tax, levy, or tax (other than inheritance or estate
taxes) imposed by any authority having the direct or indirect power to tax, as
against any legal or equitable interest of Landlord in the Leased Premises,
Building, parcel or in the Complex or on the act of entering into this Lease or,
as against Landlord's right to rent or other income therefrom, or as against
Landlord's business of leasing the Leased Premises, Building, parcel or the
Complex, any tax, fee, or charge with respect to the possession, leasing,
transfer of interest, operation, management, maintenance, alteration, repair,
use, or occupancy by Tenant, of the Leased Premises, Building, parcel or any
portion thereof or the Complex, or any tax imposed in substitution, partially or
totally, for any tax previously included within the definition of Taxes herein,
or any additional tax, the nature of which may or may not have been previously
included within the definition of Taxes. Further, if at any time during the term
of this Lease the method of taxation or assessment of real estate or the income
therefrom prevailing at the time of execution hereof shall be, or has been
altered so as to cause the whole or any part of the Taxes now or hereafter
levied, assessed or imposed on real estate to be levied, assessed or imposed
upon Landlord, wholly or partially, as a capital levy, business tax, fee, permit
or other charge, or on or measured by the Rents received therefrom, then such
new or altered taxes, regardless of their nature, which are attributable to the
land, the Building or to other improvements on the land shall be deemed to be
included within the term "Real Estate Taxes" for purposes of this Section,
whether in substitution for, or in addition to any other Real Estate Taxes, save
and except that such shall not be deemed to include any enhancement of said tax
attributable to other income of Landlord. With respect to any general or special
assessments which may be levied upon or against the Leased Premises, Building,
Complex, or the underlying realty, or which may be evidenced by improvement or
other bonds, and may be paid in annual or semi-annual installments, only the
amount of such installment, prorated for any partial year, and statutory
interest shall be included within the computation of Taxes for which Tenant is
responsible hereunder.

          The parcel containing the Building is a separate tax parcel that also
contains a six story building with a 5 story parking garage and approximately
21,665 square feet of Rentable Area having a street address of 185 Park Center
Plaza, San Jose, California (the "185 Park Center Building"), together with all
other improvements on such parcel. Since the Building and the 185 Park Center
Building are currently included in the same Tax bill and contain different size
and types of improvements, Landlord shall have the right to reasonably allocate
the Taxes to each such building in accordance with Landlord's accounting and
management principles. Currently, Taxes are allocated 9.71% to the Building and
the balance to the 185 Park Center Building, but Landlord reserves the right to
re-adjust such allocation in its good faith discretion.

          Notwithstanding anything to the contrary contained in the foregoing
definition of Real Estate Taxes, Tenant shall not be responsible or liable for
the payment of (a) any state or federal income taxes assessed against Landlord,
(b) any estate, succession or inheritance taxes of Landlord, (c) any corporation
franchise taxes imposed upon the corporate owner of the fee of the Building, or
(d) any transfer taxes to record any document to convey any interest in the
Building or the Complex (however any increase in taxes as result of any change
of ownership shall be included in Real Estate Taxes).

     "Rent "rent" or "rental" means Minimum Monthly Rent and all other sums
      ----
required to be paid by Tenant pursuant to the terms of this Lease.

          "Rentable Area" "Rentable Area" as used in the Lease shall be
           -------------
determined as follows:

                                       7
<PAGE>

          (a)  Single Tenant Floor. As to each floor of the Building on which
               -------------------
the entire space rentable to tenants is or will be leased to one tenant,
Rentable Area shall be the entire area bounded by the inside surface of the
exterior glass walls on such floor, including all areas used for elevator
lobbies, corridors, special stairways, special elevators, restrooms, mechanical
rooms, electrical rooms and telephone closets, without deduction for columns and
other structural portions of the Building or vertical penetrations that are
included for the special use of Tenant, but excluding the area contained within
the interior walls of the Building stairs, fire towers, vertical ducts, elevator
shafts, flues, vents, stacks, pipe shafts, and the rentable square footage
described in Paragraph (c) below.

          (b)  Multi-Tenant Floor. As to each floor of the Building on which
               ------------------
space is or will be leased to more than one tenant, Rentable Area attributable
to each such lease shall be the total of (i) the entire area included within the
Leased Premises covered by such lease, being the area bounded by the inside
surface of any exterior glass walls, the exterior of all walls separating such
Leased Premises from any public corridors or other public areas on such floor,
and the centerline of all walls separating such Leased Premises from other areas
leased or to be leased to other tenants on such floors, (ii) a pro rata portion
of the area within the elevator lobbies, corridors, restrooms, mechanical rooms,
electrical rooms, telephone closets and their enclosing walls situated on such
floor and (iii) the rentable square footage described in Paragraph (c) below.

          (c)  Building Load. In any event, Rentable Area shall also include
               -------------
Tenant's Proportionate Share of the lobbies of the Building and Tenant's
Proportionate Share of the area of the emergency equipment, fire pump equipment,
electrical switching gear, telephone equipment and mail delivery facilities
serving the Building.

          (d)  Deemed Square Footage. The Rentable Area of the Leased Premises
               ---------------------
is deemed to be the square footage set forth in section 1.4 of this Lease as of
the date hereof, and Rentable Area of the Building is deemed to be the square
footage set forth in section 1.5 hereof. From time to time at landlord's option,
Landlord may re-measure the Rentable Area of the Leased Premises and the
Building and the other building on the Land, which determination shall be
conclusive and thereon Tenant's Proportionate Share shall be adjusted
accordingly, but the Minimum Monthly Rent shall not be changed.

     "Structural" as herein used shall mean any portion of the Leased Premises,
      ----------
Building or Common Areas of the Complex which provides bearing support to any
other integral member of the Leased Premises, Building or Common Areas of the
Complex such as, by limitation, the roof structure (trusses, joists, beams),
posts, load beating walls, foundations, girders, floor joists, footings, and
other load bearing members constructed by Landlord.

                     ARTICLE 3  PREMISES AND COMMON AREAS

     3.1  Demising Clause. Landlord hereby leases to Tenant, and Tenant hires
          ---------------
from Landlord the Leased Premises, consisting of the approximate square footage
listed in the Salient Lease Terms, which the parties agree shall be deemed the
actual square footage, subject to change by Landlord in connection with changes
in the Rentable Area of the floor on which the Leased Premises are located.

     3.2  Reservation. Landlord reserves the area beneath and above the Building
          -----------
as well as the exterior thereof together with the right to install, maintain,
use, repair and replace pipes, ducts, conduits, wires, and structural elements
leading through the Leased Premises serving other parts of the Building and
Common Areas of the Complex, so long as such items are concealed by walls,
flooring or ceilings. Such reservation in no way affects the maintenance
obligations imposed herein. Landlord may change the shape, size, location,
number and extent of the improvements to any portion of the Building or Common
Areas of the Complex without the consent of Tenant; provided, however, that
Landlord agrees not to materially reduce the size of the parking area in the
parking garage in the Building, except for temporary reductions due to repairs,
maintenance and improvements and damage by casualty.

                                       8
<PAGE>

     3.3  Covenants, Conditions and Restrictions. The parties agree that this
          --------------------------------------
Lease is subject to the effect of (a) any covenants, conditions, restrictions,
easements, mortgages or deeds of trust, ground leases, rights of way of record,
and any other matters or documents of record, including, without limitation, the
Declaration of Restrictions referred to in the Salient Lease Terms; (b) any
zoning laws of the city, county and state where the Complex is situated; and (c)
general and special taxes not delinquent. Tenant agrees that as to its leasehold
estate, Tenant and all persons in possession or holding under Tenant will
conform to and will not violate the terms of any covenants, conditions or
restrictions of record which may now or hereafter encumber the Building or the
Complex, including, without limitation, the Declaration of Restrictions referred
to in the Salient Lease Terms (hereinafter the "restrictions"). This Lease is
subordinate to the restrictions and any amendments or modifications thereto.

     3.4  Common Areas. Landlord hereby grants to Tenant, for the benefit of
          ------------
Tenant and its employees, suppliers, shippers, customers and invitees, during
the term of this Lease, the non-exclusive right to use, in common with others
entitled to such use, the Common Areas as they exist from time to time, subject
to the limitation of Tenant's parking privileges as provided in Addendum No. 1
attached hereto and any rights, powers, and privileges reserved by Landlord
under the terms hereof or under the terms of any rules and regulations or
restrictions governing the use of the Building or the Complex. Under no
circumstances shall the right herein granted to use the Common Areas be deemed
to include the right to store any property, temporarily or permanently, in the
Common Areas. Any such storage shall be permitted only by the prior written
consent of Landlord or Landlord's designated agent, which consent may be revoked
at any time. In the event that any unauthorized storage shall occur then
Landlord shall have the right, without notice, in addition to such other rights
and remedies that it may have, to remove the property and charge the cost to
Tenant, which cost shall be immediately payable upon demand by Landlord.

          (a)  Common Areas-Changes. Landlord shall have the right, in
               --------------------
Landlord's sole discretion, from time to time:

               (1)  To make changes and reductions to the Common Areas,
including, without limitation, changes in the location, size, shape and number
of driveways, entrances, parking spaces, parking areas, loading and unloading
areas, ingress, egress, direction of traffic, landscaped areas and walkways;
provided, however, that Landlord agrees not to materially reduce the size of the
parking area in the parking garage in the Building, except for temporary
reductions due to repairs, maintenance and improvements and damage by casualty;

               (2)  To close temporarily any of the Common Areas for maintenance
purposes so long as reasonable access to the Premises remains available;

               (3)  To designate other land outside the boundaries of the
Building to be a part of the Common Areas;

               (4)  To add additional improvements to the Common Areas;

               (5)  To use the Common Areas while engaged in making additional
improvements, repairs or alterations to the Building or Complex, or any portion
thereof;

               (6)  To do and perform such other acts and make such other
changes in, to or with respect to the Common Areas, Building and Complex as
Landlord may, in the exercise of sound business judgment, deem to be
appropriate.

          (b)  Common Area Maintenance. Landlord shall, in Landlord's sole
               -----------------------
discretion, maintain the Common Areas (subject to reimbursement pursuant to this
Lease), establish and enforce reasonable rules and regulations concerning such
areas, close any of the Common Areas to whatever extent required in the opinion

                                       9
<PAGE>

of Landlord's counsel to prevent a dedication of any of the Common Areas or the
accrual of any rights of any person or of the public to the Common Areas, close
temporarily any of the Common Areas for maintenance purposes, and make changes
to the Common Areas including, without limitation, changes in the location of
driveways, corridors, entrances, exits, the designation of areas for the
exclusive use of others, the direction of the flow of traffic or construction of
additional buildings thereupon. Landlord may provide security for the Common
Areas, but is not obligated to do so. Under no circumstances shall Landlord be
liable or responsible for any acts or omissions of any party providing any
services to the Common Areas, Building or other improvements, including, without
limitation, any security service, notwithstanding anything to the contrary
contained in this Lease.

                        ARTICLE 4  TERM AND POSSESSION

     4.1  Commencement Date. The Term of this Lease shall commence on the
          -----------------
Commencement Date and shall be for the term specified in Section 1.8 hereof
(which includes as set forth in Section 1.8 any partial month at the
commencement of the Term if the Term commences other than on the first day of
the calendar month).

     4.2  Acknowledgment of Commencement. After delivery of the Leased Premises
          ------------------------------
to Tenant, Tenant shall execute a written acknowledgment of the date of
commencement in the form attached hereto as Exhibit D, and by this reference it
shall be incorporated herein.

     4.3  Pre-Term Possession. If the Leased Premises are to be constructed or
          -------------------
remodeled by Landlord, Landlord will notify Tenant approximately 14 days prior
to the estimated date when the Leased Premises are ready for Tenant's fixturing
or Tenant's work, which may be prior to Substantial Completion of the Leased
Premises by Landlord, but Tenant must have at least 7 days of access to the
Leased Premises prior to the Commencement Date when carpeting has been installed
even though the Tenant Improvements may not have been Substantially Completed as
provided in Exhibit C attached hereto. Tenant may thereupon enter the Leased
Premises for such purposes at its own risk, to make such improvements as Tenant
shall have the right to make, to install fixtures, supplies, inventory and other
property. Tenant agrees that it shall not in any way interfere with the progress
of Landlord's work by such entry. Should such entry prove an impediment to the
progress of Landlord's work, in Landlord's judgment, Landlord may demand that
Tenant forthwith vacate the Leased Premises until such time as Landlord's work
is complete, and Tenant shall immediately comply with this demand. During the
course of any pre-term possession, whether such pre-term period arises because
of an obligation of construction on the part of Landlord,' or otherwise, all
terms and conditions of this Lease, except for rent and commencement, shall
apply, particularly with reference to indemnity by Tenant of Landlord under
section 10.4 and 14.4.

     4.4  Delay. If Landlord, for any reason whatsoever, cannot deliver
          -----
possession of the Leased Premises to Tenant with the Tenant Improvements
Substantially Completed (as defined in Exhibit C) by the Estimated Commencement
Date, this Lease shall not be void or voidable, nor shall Landlord be liable for
any loss or damage resulting therefrom, but in that event, there shall be no
accrual of Rent for the period between the Estimated Commencement Date and the
Commencement Date, except if the delay is due to a Tenant Delay (as defined in
Exhibit C). Notwithstanding the foregoing, if the Tenant Improvements have not
been Substantially Completed within 120 days of the Estimated Commencement Date
and such delay is not due to any Tenant Delay or Force Majeure Delay (as defined
in Exhibit C), then Tenant as its sole and exclusive remedy shall have the right
to terminate this Lease upon written notice to Landlord within the earlier of 10
days after (i) the end of said 120 day period (but prior to Substantial
Completion of the Tenant Improvements), or (ii) receipt of written notice from
Landlord of a delay beyond said time period.

     4.5  Acceptance of Work.. Within fifteen (15) days following the date
          -------------------
Tenant takes possession of each floor of the Leased Premises, Tenant may provide
Landlord with a punch list which sets forth any corrective work to be performed
by Landlord with respect to work performed by Landlord; provided, however,

                                       10
<PAGE>

that Tenant's obligation to pay Rent and other sums under this Lease shall not
be affected thereby. If Tenant fails to submit a punch list to Landlord within
such fifteen (15) day period, Tenant agrees that by taking possession of the
Leased Premises it will conclusively be deemed to have inspected the Leased
Premises and found the Leased Premises in satisfactory condition, with all work
required of Landlord completed. Tenant acknowledges that neither Landlord, nor
any agent, employee or servant of Landlord, has made any representation or
warranty, expressed or implied, with respect to the Leased Premises, Building or
Common Areas of the Complex, or with respect to the suitability of them to the
conduct of Tenant's business, nor has Landlord agreed to undertake any
modifications,, alterations, or improvements of the Leased Premises, Building or
Common Areas of the Complex, except as specifically provided in this Lease.

     4.6  Failure to Take Possession. Tenant's inability or failure to take
          --------------------------
possession of the Leased Premises, or applicable portions thereof, when delivery
is tendered by Landlord shall not delay the Commencement Date of the Lease or
Tenant's obligation to pay Rent. Tenant acknowledges that Landlord shall incur
significant expenses upon the execution of this Lease, even if Tenant never
takes possession of the Leased Premises, including, without limitation,
brokerage commissions and fees, legal or other professional fees, the costs of
space planning and the costs of construction of Tenant Improvements in the
Premises. Tenant acknowledges that all of said expenses, in addition to all
other expenses incurred and damages suffered by Landlord, shall be included in
measuring Landlord's damages should Tenant breach the terms of this Lease.

                        ARTICLE 5 MINIMUM MONTHLY RENT

     5.1  Payment. Tenant shall pay to Landlord at the address specified in
          -------
Section 1.1, or at such other place as Landlord may otherwise designate, as
"Minimum Monthly Rent" for the Leased Premises the amount specified in Section
1.9 hereof, payable in advance on the first day of each month during the Term of
the Lease. If the Term commences on other than the first day of a calendar
month, the rent for the first partial month shall be prorated accordingly. All
payments of Minimum Monthly Rent (including sums defined as rent in Section 2
shall be in lawful money of the United States, and payable without deduction,
offset, counterclaim, prior notice or demand.

     5.2  Advance Rent. The amount specified in Section 1.9(B) hereof is paid
          ------------
herewith to Landlord upon execution of this Lease as advance rent, receipt of
which is hereby acknowledged, provided, however, that such amount shall be held
by Landlord as an additional "Security Deposit" pursuant to this Lease until it
is applied by Landlord to the first Minimum Monthly Rent due hereunder.

     5.3  Late Payment. If during any twelve (12) month period, Tenant fails to
          ------------
pay Rent within five (5) days after receipt of notice that payment is past due
on more than three occasions, then Landlord may, by giving written notice to
Tenant, require that Tenant pay the Minimum Monthly Rent and other Rent to
Landlord quarterly in advance.

                           ARTICLE 6 ADDITIONAL RENT

     6.1  Personal Property, Gross Receipts, Leasing Taxes. This section is
          ------------------------------------------------
intended to deal with impositions or taxes directly attributed to Tenant or this
transaction, as distinct from taxes attributable to the Building or Common Areas
of the Complex which are to be allocated among various tenants and others.
Tenant shall pay before delinquency any and all taxes, assessments, license fees
and public charges levied, assessed or imposed against Tenant or Tenant's estate
in this Lease or the property of Tenant situated within the Premises which
become due during the Term. On demand by Landlord, Tenant shall furnish Landlord
with satisfactory evidence of these payments. If such taxes are included in the
bill for the Real Estate Taxes for the Building or Complex, then Tenant shall
pay to Landlord as additional rent the amount of such taxes within ten (10) days
after demand from Landlord.

                                       11
<PAGE>

     6.2  Operating Costs, Taxes and Insurance.
          ------------------------------------

          (a)  Base Year Increases. If the Operating Costs, Taxes and/or
               -------------------
Insurance Costs for any Lease Year, calculated on the basis of the greater of
(i) actual Operating Costs, Taxes and Insurance Costs; or (ii) as if the
Building were at least one hundred percent (100%) occupied and operational for
the whole of such Lease Year, are more than the applicable Base Year Costs for
Base Operating Costs, Base Taxes and Base Insurance as set forth in section 1.10
(which Base Year Costs shall be calculated separately for each such category of
Base Year Costs), Tenant shall pay to Landlord its Proportionate Share of any
such increase in Operating Costs, Taxes and/or Insurance Costs, as the case may
be, as additional Rent as hereinafter provided.

          (b)  Partial Year. If any Lease Year of less than twelve (12) months
               ------------
is included within the Term, the amount payable by Tenant for such period shall
be prorated on a per diem basis (utilizing a thirty (30) day month, three
hundred sixty (360) day year).

     6.3  Method of Payment. Any additional Rent payable by Tenant under
          -----------------
Sections 6.1 and 6.2 hereof shall be paid as follows, unless otherwise provided:

          (a)  Estimated Monthly. During the Term, Tenant shall pay to Landlord
               -----------------
monthly in advance with its payment of Minimum Monthly Rent, one-twelfth
(1/12th) of the amount of such additional Rent as estimated by Landlord in
advance, in good faith, to be due from Tenant. If at any time during the course
of the fiscal year, Landlord determines that Operating Costs, Insurance Costs
and/or Taxes are projected to vary from the then estimated costs for such items
by more than ten percent (10%), Landlord may, by written notice to Tenant,
revise the estimated Operating Costs, Insurance Costs and/or Taxes for the
balance of such fiscal year, and Tenant's monthly installments for the remainder
of such year shall be adjusted so that by the end of such fiscal year Tenant
will have paid to Landlord Tenant's Proportionate Share of the such revised
expenses for such year.

          (b)  Annual Reconciliation. Annually, as soon as is reasonably
               ---------------------
possible after the expiration of each Lease Year, Landlord shall prepare in good
faith and deliver to Tenant a comparative statement, which statement shall be
conclusive between the parties hereto, setting forth (1) the Operating Costs,
Taxes and Insurance Costs for such Lease Year, and (2) the amount of additional
Rent as determined in accordance with the provisions of this Article 6.

          (c)  Adjustment. If the aggregate amount of such estimated additional
               ----------
Rent payments made by Tenant in any Lease Year should be less than the
additional Rent due for such year, then Tenant shall pay to Landlord as
additional Rent upon demand the amount of such deficiency. If the aggregate
amount of such additional Rent payments made by Tenant in any Lease Year of the
Term should be greater than the additional Rent due for such year, then should
Tenant not be otherwise in default hereunder, the amount of such excess will be
applied by Landlord to the next succeeding installments of such additional Rent
due hereunder; and if there is any such excess for the last year of the Term,
the amount thereof will be refunded by Landlord to Tenant within sixty (60) days
of the last day of the Term, provided Tenant is not otherwise in default under
the terms of this Lease.

     6.4  Inspection. Tenant shall have the right at its own expense to inspect
          ----------
the books and records of Landlord pertaining to Operating Costs, Insurance Costs
and Taxes once in any calendar year by any employee of Tenant or by a certified
public accountant mutually acceptable to Landlord and Tenant (provided such
certified public accountant charges for its service on an hourly basis and not
based on a percentage of any recovery or similar incentive method) at reasonable
times, and upon reasonable written notice to Landlord. Within ninety (90) days
after receipt of Landlord's annual reconciliation, Tenant shall have the right,
after at least ten (10) days prior written notice to Landlord, to inspect at the
offices of Landlord or its property manager, the books and records of Landlord
pertaining solely to the Operating Costs, Insurance Costs and Taxes for the
immediately preceding calendar year covered in such annual reconciliation
statement. All expenses of the

                                       12
<PAGE>

inspection shall be borne by Tenant. If Tenant's inspection reveals a
discrepancy in the comparative annual reconciliation statement, Tenant shall
deliver a copy of the inspection report and supporting calculations to Landlord
within thirty (30) days after completion of the inspection. If Tenant and
Landlord are unable to resolve the discrepancy within thirty (30) days after
Landlord's receipt of the inspection report, either party may upon written
notice to the other have the matter decided by an inspection by an independent
certified public accounting firm approved by Tenant and Landlord (the "CPA
Firm"), which approval shall not be unreasonably withheld or delayed. If the
inspection by the CPA Firm shows that the actual amount of Operating Costs,
Insurance Costs or Taxes payable by Tenant is greater than the amount previously
paid by Tenant for such accounting period, Tenant shall immediately pay Landlord
the difference. If the inspection by the CPA Firm shows that the actual
applicable amount is less than the amount paid by Tenant, then the difference
shall be applied in payment of the next estimated monthly installments of
Operating Costs, Insurance Costs and/or Taxes owing by Tenant, or in the event
such accounting occurs following the expiration of the Term hereof, such
difference shall be refunded to Tenant. Tenant shall pay for the cost of the
inspection by the CPA Finn, unless such inspection shows that Landlord
overstated Operating Costs, Insurance Costs or Taxes by more than five percent
(5%), in which case Landlord shall pay for the cost of the inspection by the CPA
Firm.

                      ARTICLE 7  ACCORD AND SATISFACTION

     7.1  Acceptance of Payment. No payment by Tenant or receipt by Landlord of
          ---------------------
a lesser amount of Minimum Monthly Rent or any other sum due hereunder, shall be
deemed to be other than on account of the earliest due rent or payment, nor
shall any endorsement or statement on any check or any letter accompanying any
such check or payment be deemed an accord and satisfaction, and Landlord may
accept such check or payment without prejudice to Landlord's right to recover
the balance of such rent or payment or pursue any other remedy available in this
Lease, at law or in equity. Landlord may accept any partial payment from Tenant
without invalidation of any contractual notice required to be given herein (to
the extent such contractual notice is required) and without invalidation of any
notice required to be given pursuant to California Code of Civil Procedure
Section 1161, et seq., or of any successor statute thereto.

                          ARTICLE 8  SECURITY DEPOSIT

     8.1  Payment on Lease Execution. Tenant shall pay Landlord upon execution
          --------------------------
hereof the sum specified in the Salient Lease Terms as a Security Deposit. This
sum is designated as a Security Deposit and shall remain the sole and separate
property of Landlord until actually repaid to Tenant (or at Landlord's option
the last assignee, if any, of Tenant's interest hereunder), said sum not being
earned by Tenant until all conditions precedent for its payment to Tenant have
been fulfilled. As this sum both in equity and at law is Landlord's separate
property, Landlord shall not be required to (1) keep said deposit separate from
his general accounts, or (2) pay interest, or other increment for its use. if
Tenant fails to pay rent or other charges when due hereunder, or otherwise
defaults with respect to any provision of this Lease, including and not limited
to Tenant's obligation to restore or clean the Leased Premises following
vacation thereof, Tenant, at Landlord's election, shall be deemed not to have
earned the right to repayment of the Security Deposit, or those portions thereof
used or applied by Landlord for the payment of any rent or other charges in
default, or for the payment of any other sum to which Landlord may become
obligated by reason of Tenant's default, or to compensate Landlord for any loss
or damage which Landlord may suffer thereby. Landlord may retain such portion of
the Security Deposit as it reasonably deems necessary to restore or clean the
Leased Premises following vacation by Tenant. The Security Deposit is not to be
characterized as rent until and unless so applied in respect of a default by
Tenant.

     8.2  Restoration of Deposit. If Landlord elects to use or apply all or any
          ----------------------
portion of the Security Deposit as provided in Section 8.1, Tenant shall within
ten (10) days after written demand therefor pay to Landlord in cash, an amount
equal to that portion of the Security Deposit used or applied by Landlord, and
Tenant's failure to so do shall be a material breach of this Lease. The ten (10)
day notice specified in the preceding sentence shall insofar as not prohibited
by law, constitute full satisfaction of notice of default provisions required by
law or ordinance.

                                       13
<PAGE>

                                 ARTICLE 9 USE

     9.1  Permitted Use. The Leased Premises may be used and occupied only for
          -------------
the purposes specified in Section 1.12 hereof, and for no other purpose or
purposes. Tenant shall promptly comply with all laws, ordinances, orders and
regulations affecting the Leased Premises, their cleanliness, safety, occupation
and use. Tenant shall not use, or permit to be used, the Leased Premises in any
manner that will disturb any other tenant in the Building or Complex, or
obstruct or interfere with the rights of other tenant or occupants of the
Building or Complex, or injure or annoy them or create any unreasonable smells,
noise or vibrations (taking into account the nature and tenant-mix of the
Building). Tenant shall not allow the Leased Premises to be used for any
improper, immoral, unlawful Or objectionable purpose.

     9.2  Safes, Heavy Equipment. Tenant shall not place a load upon any floor
          ----------------------
of the Leased Premises which exceeds the lesser of fifty (50) pounds per square
foot live load or such other amount specified in writing by Landlord from time
to time. Landlord reserves the right to prescribe the weight and position of all
safes and heavy installations which Tenant wishes to place in the Leased
Premises so as properly to distribute the weight thereof, or to require plans
prepared by a qualified structural engineer at Tenant's sole cost and expense
for such heavy objects. Notwithstanding the foregoing, Landlord shall have no
liability for any damage caused by the installation of such heavy equipment or
safes.

     9.3  Machinery. Business machines and mechanical equipment belonging to
          ---------
Tenant which cause noise and/or vibration that may be transmitted to the
structure of the Building or to any other leased space to such a degree as to be
objectionable to Landlord or to any tenants in the Complex shall be placed and
maintained by the party possessing the machines or equipment, at such party's
expense, in settings of cork, rubber or spring type noise and/or vibration
eliminators, and Tenant shall take such other measures as needed to eliminate
vibration and/or noise. If the noise or vibrations cannot be eliminated, Tenant
must remove such equipment within ten (10) days following written notice from
Landlord.

     9.4  Waste or Nuisance. Tenant shall not commit, or suffer to be committed,
          -----------------
any waste upon the Leased Premises, or any nuisance, or other act or thing which
may disturb the quiet enjoyment of any other tenant or occupant of the Complex
in which the Leased Premises are located.

                ARTICLE 10 COMPLIANCE WITH LAWS AND REGULATIONS

     10.1  Compliance Obligations. Tenant shall, at its sole cost and expense,
           ----------------------
comply with all of the requirements of all municipal, state and federal
authorities now in force, or which may hereafter be in force, pertaining to the
Leased Premises, and shall faithfully observe in the use or occupancy of the
Leased Premises all municipal ordinances and state and federal statutes, laws
and regulations now or hereafter in force, including, without limitation, the
"Environmental Laws" (as hereinafter defined), and the Americans with
Disabilities Act, 42 U.S.C. (S)(S) 12101-12213 (and any rules, regulations,
restrictions, guidelines, requirements or publications promulgated or published
pursuant thereto) (herein referred to as the ("ADA"), whether or not any of the
foregoing were foreseeable or unforeseeable at the time of the execution of this
Lease. Tenant's obligation to comply with and observe such requirements,
ordinances, statutes and regulations shall apply regardless of whether such
requirements, ordinances, statutes and regulations regulate or relate to
Tenant's particular use of the Leased Premises or regulate or relate to the use
of premises in general, and regardless of the cost thereof. The judgment of any
court of competent jurisdiction, or the admission of Tenant in any action or
proceeding against Tenant, whether Landlord be a party thereto or not, that any
such requirement, ordinance, statute or regulation pertaining to the Leased
Premises has been violated, shall be conclusive of that fact as between Landlord
and Tenant.

          Notwithstanding the foregoing, Landlord agrees, at its expense, to
make the improvements to the existing bathrooms in the Leased Premises if such
work is required under the ADA in connection with the construction by Tenant in
the future of any other alterations in the Leased Premises to the extent
Landlord does

                                       14
<PAGE>

not construct such improvements as part of the initial Tenant Improvements.

     10.2  Condition of Leased Premises. Subject to Landlord's work, if any, as
           ----------------------------
referred to in Exhibit C to this Lease, Tenant hereby accepts the Leased
Premises in the condition existing as of the date of occupancy, subject to all
applicable zoning, municipal, county and state laws, ordinances, rules,
regulations, orders, restrictions of record, and requirements in effect during
the Term or any part of the Term hereof regulating the Leased Premises, and
without representation, warranty or covenant by Landlord, express or implied, as
to the condition, habitability or safety of the Leased Premises, the suitability
or fitness thereof for their intended purposes, or any other matter.

     10.3  Hazardous Materials.
           -------------------

          (a) Hazardous Materials. As used herein, the term "Hazardous
              -------------------
Materials" shall mean any wastes, materials or substances (whether in the form
of liquids, solids or gases, and whether or not air-borne), which are or are
deemed to be (i) pollutants or contaminants, or which are or are deemed to be
hazardous, toxic, ignitable, reactive, corrosive, dangerous, harmful or
injurious, or which present a risk to public health or to the environment, or
which are or may become regulated by or under the authority of any applicable
local, state or federal laws, judgments, ordinances, orders, rules, regulations,
codes or other governmental restrictions, guidelines or requirements, any
amendments or successor(s) thereto, replacements thereof or publications
promulgated pursuant thereto, including, without limitation, any such items or
substances which are or may become regulated by any of the Environmental Laws
(as hereinafter defined); (ii) listed as a chemical known to the State of
California to cause cancer or reproductive toxicity pursuant to Section 25249.8
of the California Health and Safety Code, Division 20, Chapter 6.6 (Safe
Drinking Water and Toxic Enforcement Act of 1986); or (iii) a pesticide,
petroleum, including crude oil or any fraction thereof, asbestos or an asbestos-
containing material, a polychlorinated biphenyl, radioactive material, or urea
formaldehyde.

          (b) Environmental Laws. In addition to the laws referred to in section
              ------------------
10.3(a) above, the term "Environmental Laws" shall be deemed to include, without
limitation, 33 U.S.C. Section 1251 et seq., 42 U.S.C. Section 6901 et seq., 42
                                   -- ---                          -- ---
U.S.C. Section 7401 et seq., 42 U.S.C. Section 9601 et seq., and California
                    -- ---                          -- ---
Health and Safety Code Section 25100 et seq., and 25300 et seq., California
                                     -- ---             -- ---
Water Code, Section 13020 et seq., or any successor(s) thereto, all local, state
                          -- ---
and federal laws, judgments, ordinances, orders, roles, regulations, codes and
other governmental restrictions, guidelines and requirements, any amendments and
successors thereto, replacements thereof and publications promulgated pursuant
thereto, which deal with or otherwise in any manner relate to, air or water
quality, air emissions, soil or ground conditions or other environmental matters
of any kind.

          (c) Use of Hazardous Materials. Tenant agrees that during the Term of
              --------------------------
this Lease, there shall be no use, presence, disposal, storage, generation,
leakage, treatment, manufacture, import, handling, processing, release, or
threatened release of Hazardous Materials on, from or under the Leased Premises
(individually and collectively, "Hazardous Use") except to the extent that, and
in accordance with such conditions as, Landlord may have previously approved in
writing in its sole and absolute discretion. However, without the necessity of
obtaining such prior written consent, Tenant shall be entitled to use and store
only those Hazardous Materials which are (i) typically used in the ordinary
course of business in an office for use in the manner for which they were
designed and in such limited amounts as may be normal, customary and necessary
for Tenant's business in the Premises, and (ii) in full compliance with
Environmental Laws, and all judicial and administrative decisions pertaining
thereto. For the purposes of this Section 10.3(c), the term Hazardous Use shall
include Hazardous Use(s) on, from or under the Leased Premises by Tenant or any
of its directors, officers, employees, shareholders, partners, invitees, agents,
contractors or occupants (collectively, "Tenant's Parties"), whether known or
unknown to Tenant, and whether occurring and/or existing during or prior to the
commencement of the Term of this Lease.

                                       15
<PAGE>

          (d) Compliance. Tenant agrees that during the Term of this Lease
              ----------
Tenant shall not be in violation of any federal, state or local law, ordinance
or regulation relating to industrial hygiene, soil, water, or environmental
conditions on, under or about the Leased Premises including, but not limited to,
the Environmental Laws.

          (e) Inspection and Testing by Landlord. Landlord shall have the right
              ----------------------------------
at all times during the term of this Lease to (i) inspect the Leased Premises
and to (ii) conduct tests and investigations to determine whether Tenant is in
compliance with the provisions of this Section. Except in case of emergency,
Landlord shall give reasonable notice to Tenant before conducting any
inspections, tests, or investigations. The cost of all such inspections, tests
and investigations shall be borne by Tenant, if Tenant is in breach of Section
10.3 of this Lease. Neither any action nor inaction on the part of Landlord
pursuant to this Section 10.3(e) shall be deemed in any way to release Tenant
from, or in any way modify or alter, Tenant's responsibilities, obligations,
and/or liabilities incurred pursuant to Section 10.3 hereof.

     10.4  Indemnity. Tenant shall indemnify, hold harmless, and, at Landlord's
           ---------
option (with such attorneys as Landlord may approve in advance and in writing),
defend Landlord and Landlord's officers, directors, shareholders, partners,
members, managers, employees, contractors, property managers, agents and
mortgagees and other lien holders, from and against any and all "Losses"
(hereinafter defined) arising from or related to: (a) any violation or alleged
violation by Tenant or any of Tenant's Parties of any of the requirements,
ordinances, statutes, regulations or other laws referred to in this Article 10,
including, without limitation the Environmental Laws; (b) any breach of the
provisions of this Article 10 by Tenant or any of Tenant's Parties; or (c) any
Hazardous Use on, about or from the Leased Premises of any Hazardous Material
approved by Landlord under this Lease. The term "Losses" shall mean all claims,
demands, expenses, actions, judgments, damages (whether consequential, direct or
indirect, known or unknown, foreseen or unforeseen), penalties, fines,
liabilities, losses of every kind and nature (including, without limitation,
property damage, diminution in value of Landlord's interest in the Leased
Premises or the Complex, damages for the loss or restriction on use of any space
or amenity within the Building or the Complex, damages arising from any adverse
impact on marketing space in the Complex, sums paid in settlement of claims and
any costs and expenses associated with injury, illness or death to or of any
person), suits, administrative proceedings, costs and fees, including, but not
limited to, attorneys' and consultants' fees and expenses, and the costs of
cleanup, remediation, removal and restoration, that are in any way related to
any matter covered by the foregoing indemnity.

                        ARTICLE 11 SERVICE AND EQUIPMENT

     11.1  Climate Control. So long as Tenant is not in default under any of the
           ---------------
covenants of this Lease, Landlord shall provide climate control to the Leased
Premises from 7:00 a.m. to 6:00 p.m. (the "Climate Control Hours") on weekdays
and 9:00 a.m. to 1:00 p.m. Saturdays (Sundays and holidays excepted) to maintain
a temperature adequate for comfortable occupancy, provided that Landlord shall
have no responsibility or liability for failure to supply climate control
service when making repairs, alterations or improvements or when prevented from
so doing by strikes or any cause beyond Landlord's reasonable control. Any
climate control furnished for periods not within the Climate Control Hours
pursuant to Tenant's request shall be at Tenant's sole cost and expense in
accordance with rate schedules promulgated by Landlord from time to time. Upon
request, Landlord shall advise Tenant of the then current rate schedule and the
basis for its calculation. Tenant acknowledges that Landlord has installed in
the Building a system for the purpose of climate control. Any use of the Leased
Premises not in accordance with the design standards or any arrangement of
partitioning which interferes with the normal operation of such system may
require changes or alterations in the system or ducts through which the climate
control system operates. Any changes or alterations so occasioned, if such
changes can be accommodated by Landlord's equipment, shall be made by Tenant at
its cost and expense but only with the written consent of Landlord first had and
obtained, and in accordance with drawings and specifications and by a contractor
first approved in writing by Landlord. If installation of partitions, equipment
or fixtures by Tenant necessitates the re-balancing of the climate control
equipment in the Leased Premises, the same will be performed by Landlord at
Tenant's expense. Tenant acknowledges that up to

                                       16
<PAGE>

one (1) year may be required after Tenant has fully occupied the Leased Premises
in order to adjust and balance the climate control systems, but Landlord agrees
to use its good faith efforts to adjust and balance such system as soon as is
commercially reasonable. Any charges to be paid by Tenant hereunder shall be due
within ten (10) days of receipt of an invoice from Landlord, which invoice may
precede Landlord's expenditure for the benefit of Tenant.

     11.2  Elevator Service. Landlord shall provide elevator service (which may
           ----------------
be with or without operator at Landlord's option) provided that Tenant, its
employees, and all other persons using such services shall do so at their own
risk.

     11.3  Cleaning Public Areas. Landlord shall maintain and keep clean the
           ---------------------
street level lobbies, sidewalks, truck dock, public corridors and other public
portions of the Building.

     11.4  Refuse Disposal. Tenant shall pay Landlord, within ten (10) days of
           ---------------
being billed therefor, for the removal from the Leased Premises and the Building
of such refuse and rubbish of Tenant as shall exceed that ordinarily accumulated
daily in the routine of a reasonable office.

     11.5  Janitorial Service. Landlord shall provide cleaning and janitorial
           ------------------
service in and about the Complex and Leased Premises each weekday unless such
service for a Friday is done on a weekend (Saturdays, Sundays and holidays
excepted except for service done on a weekend for a Friday) in accordance with
standards in first-class office buildings in the city in which the Building is
located.

     11.6  Special Cleaning Service. To the extent that Tenant shall require
           ------------------------
special or more frequent cleaning and/or janitorial service (hereinafter
referred to as "Special Cleaning Service") Landlord may, upon reasonable advance
notice from Tenant, elect to furnish such Special Cleaning Service and Tenant
agrees to pay Landlord, within ten (10) days of being billed therefor,
Landlord's charge for providing such additional service. Special Cleaning
Service shall include but shall not be limited to the following to the extent
such services are beyond those typically provided pursuant to section 1.5 above:

          (a) The cleaning and maintenance of Tenant eating facilities other
than the normal and ordinary cleaning and removal of garbage, which special
cleaning service shall include, without limitation, the removal of dishes,
utensils and excess garbage; it being acknowledged that normal and ordinary
cleaning service does not involve placing dishes, glasses and utensils in the
dishwasher, cleaning any coffee pot or other cooking mechanism or cleaning the
refrigerator or any appliances;

          (b) The cleaning and maintenance of Tenant computer centers, including
peripheral areas other than the normal and ordinary cleaning and removal of
garbage if Tenant so desires;

          (c) The cleaning and maintenance of special equipment areas, locker
rooms, and medical centers;

          (d) The cleaning and maintenance in areas of special security; and

          (e) The provision of consumable supplies for private toilet rooms in
any separate office.

     11.7  Electrical. During the Term of this Lease, there shall be available
           ----------
to the Leased Premises electrical facilities comparable to those supplied in
other comparable office buildings in the vicinity of the Building to provide
sufficient power for normal lighting and office machines of similar low
electrical consumption, and one personal computer for each desk station, but not
for any additional computers or extraordinary data processing equipment, special
lighting and any other item of electrical equipment which requires a voltage
other than one hundred ten (110) volts single phase, as determined by Landlord
in its sole and absolute discretion; and provided, however, that if the
installation of such electrical equipment requires additional air conditioning
capacity above that normally provided to tenants of the Building or above
standard

                                       17
<PAGE>

usage of existing capacity as determined by Landlord in its sole and absolute
discretion, then the additional air conditioning installation and/or operating
costs attributable thereto shall be paid by Tenant. Tenant agrees not to use any
apparatus or device in, upon or about the Leased Premises which may in any way
increase the amount of such electricity usually furnished or supplied to the
Leased Premises, and Tenant further agrees not to connect any apparatus or
device to the wires, conduits or pipes or other means by which such electricity
is supplied, for the purpose of using additional or unusual amounts of
electricity, without the prior written consent of Landlord. At all times,
Tenant's use of electric current shall never exceed Tenant's share of the
capacity of the feeders to the Building or the risers or wiring installation.
Tenant shall not install or use or permit the installation or use in the Leased
Premises of any computer or electronic data processing or ancillary equipment or
any other electrical apparatus designed to operate on electrical current in
excess of 110 volts and 5 amps per machine, without the prior written consent of
Landlord, which may be exercised in Landlord's reasonable discretion. If Tenant
shall require electrical current in excess of that usually furnished or supplied
for use of the Leased Premises as general office space, Tenant shall first
procure the written consent of Landlord (which may be exercised in Landlord's
reasonable discretion) to the use thereof and Landlord or Tenant may (i) cause a
meter to be installed in or for the Leased Premises, or (ii) if Tenant elects
not to install said meter, Landlord may reasonably estimate such excess
electrical current. The cost of any meters (including, without limitation, the
cost of any installation) or surveys to estimate such excess electrical current
shall be paid by Tenant. Landlord's approval or any space plan, floor plan,
construction plans, specifications, or other drawings or materials regarding the
construction of the Tenant Improvements or any alterations shall not be deemed
or construed as consent by Landlord under this paragraph to Tenant's use of such
excess electrical current as provided above. Tenant agrees to pay to Landlord,
promptly upon demand therefor, all costs of such electrical current consumed as
well as an additional use charge calculated by said meters (at the rates charged
for such services to the Building by the municipality or the local public
utility) or the amount specified in said estimate, as the case may be, plus any
additional expense incurred in keeping account of the electrical current so
consumed, which additional expense Landlord shall advise Tenant within a
reasonable time after request by Tenant.

     11.8  Water. During the Term of this Lease, if water is made available to
           -----
the Leased Premises, then water shall be used for drinking, lavatory and office
kitchen purposes only as applicable. If Tenant requires, uses or consumes water
for any purpose in addition to ordinary drinking, lavatory, and office kitchen
purposes (as determined by Landlord in its sole and absolute discretion), as
applicable, Landlord may reasonably estimate such excess and Tenant shall pay
for same. At Tenant's sole cost and expense; Landlord may also install a water
meter and thereby measure Tenant's water consumption for all purposes, and
Tenant shall keep said meter and installation equipment in good working order
and repair at Tenant's own cost and expense. Tenant agrees to pay for water
consumed, as shown in said meter, as and when bill are rendered.

     11.9  Interruptions. It is understood that Landlord does not warrant that
           -------------
any of the services referred to above or any other services which Landlord may
supply will be free from interruption. Tenant acknowledges that any one or more
such services may be suspended or reduced by reason of repairs, alterations or
improvements necessary to be made, by strikes or accidents, by any cause beyond
the reasonable control of Landlord, or by orders or regulations of any federal,
state, county or municipal authority. Any such interruption or suspension of
services shall not be deemed an eviction or disturbance of Tenant's use and
possession of the Leased Premises or any part thereof, nor render Landlord
liable to Tenant for damages by abatement of Rent or otherwise, nor relieve
Tenant of performance of Tenant's obligations under this Lease. Landlord agrees
to use its good faith efforts to restore such service.

                             ARTICLE 12 ALTERATIONS

     12.1  Consent of Landlord; Ownership. Tenant shall not make, or suffer to
           ------------------------------
be made, any alterations, additions or improvements, including, without
limitation, any alterations, additions or improvements that result in increased
telecommunication demands or require the addition of new communication or
computer wires, cables and related devises or expand the number of telephone or
communication lines dedicated to the Leased

                                       18
<PAGE>

Premises by the Building's telecommunication design, (collectively,
"alterations") to the Leased Premises, or any part thereof, without the written
consent of Landlord first had and obtained, which will not be unreasonably
withheld. Any alterations, except trade fixtures, shall upon expiration or
termination of this Lease become a part of the realty and belong to Landlord.
Except as otherwise provided in this Lease, Tenant shall have the right to
remove its trade fixtures placed upon the Leased Premises provided that Tenant
restores the Leased Premises as indicated below.

     12.2  Requirements. Any alterations, additions or installations performed
           ------------
by Tenant (hereinafter collectively "alterations") shall be subject to strict
conformity with the following requirements:

          (a) All alterations shall be at the sole cost and expense of Tenant;

          (b) Prior to commencement of any work of alteration, Tenant shall
submit detailed plans and specifications, including working drawings
(hereinafter referred to as "Plans"), of the proposed alterations, which shall
be subject to the consent of Landlord in accordance with the terms of Section
12.1 above;

          (c) Following approval of the Plans by Landlord, Tenant shall give
Landlord at least ten (10) days' prior written notice of any commencement of
work in the Leased Premises so that Landlord may post notices of non-
responsibility in or upon the Leased Premises as provided by law;

          (d) No alterations shall be commenced without Tenant having previously
obtained all appropriate permits and approvals required by and of governmental
agencies;

          (e) All alterations shall be performed in a skillful and workmanlike
manner, consistent with the best practices and standards of the construction
industry, and pursued with diligence in accordance with said Plans previously
approved by Landlord and in full accord with all applicable laws and ordinances.
All material, equipment, and articles incorporated in the alterations are to be
new and of recent manufacture and of the most suitable grade for the purpose
intended;

          (f) Tenant must obtain the prior written approval from Landlord for
Tenant's contractor before the commencement of the work. Tenant's contractor for
any work shall maintain all of the insurance reasonably required by Landlord,
including, without limitation, commercial general liability and workers'
compensation;

          (g) As a condition of approval of alterations, Landlord may require
performance and labor and materialmen's payment bonds issued by a surety
approved by Landlord, in a sum equal to the cost of the alterations guarantying
the completion of the alterations free and clear of all liens and other charges
in accordance with the Plans. Such bonds shall name Landlord as beneficiary;

          (h) The alterations must be performed in a manner such that they will
not interfere with the quiet enjoyment of the other Tenants in the Complex.

     12.3  Liens. Tenant shall keep the Leased Premises and the Complex in which
           -----
the Leased Premises are situated free from any liens arising out of any work
performed, materials furnished or obligations incurred by Tenant. In the event a
mechanic's or other lien is filed against the Leased Premises, Building or the
Complex as a result of a claim arising through Tenant, Landlord may demand that
Tenant furnish to Landlord a surety bond satisfactory to Landlord in an amount
equal to at least one hundred fifty percent (150%) of the amount of the
contested lien claim or demand, indemnifying Landlord against liability for the
same and holding the Leased Premises free from the effect of such lien or claim.
Such bond must be posted within ten (10) days following notice from Landlord. In
addition, Landlord may require Tenant to pay Landlord's reasonable attorneys'
fees and costs in participating in any action to foreclose such lien if Landlord
shall decide it is to its best interest to do so. If Tenant fails to post such
bond within said time period, Landlord after five (5) days prior written notice
to Tenant may pay the claim prior to the enforcement thereof, in which event
Tenant shall

                                       19
<PAGE>

reimburse Landlord in full, including attorneys' fees, for any such expense, as
additional rent, with the next due rental.

     12.4  Restoration. Tenant shall return the Leased Premises to Landlord at
           -----------
the expiration or earlier termination of this Lease in good and sanitary order,
condition and repair, free of rubble and debris, broom clean, reasonable wear
and tear and damage by casualty excepted. However, Tenant shall ascertain from
Landlord at least thirty (30) days prior to the termination of this Lease,
whether Landlord desires the Leased Premises, or any part thereof, restored to
its condition prior to the making of permitted alterations, installations and
improvements, and if Landlord shall so desire, then Tenant shall forthwith
restore said Leased Premises or the designated portions thereof as the case may
be, to its original condition, entirely at its own expense, excepting normal
wear and tear. All damage to the Leased Premises caused by the removal of such
trade fixtures and other personal property that Tenant is permitted to remove
under the terms of this Lease and/or such restoration shall be repaired by
Tenant at its sole cost and expense prior to termination.

                         ARTICLE 13 PROPERTY INSURANCE

     13.1  Use of Premises. No use shall be made or permitted to be made on the
           ---------------
Leased Premises, nor acts done, which will increase the existing rate of
insurance upon the building in which the Leased Premises are located or upon any
other Building in the Complex or cause the cancellation of any insurance policy
covering the Building, or any part thereof, nor shall Tenant sell, or permit to
be kept, used or sold, in or about the Leased Premises, any article which may be
prohibited by the standard form of "All Risk" fire insurance policies. Tenant
shall, at its sole cost and expense, comply with any and all requirements
pertaining to the Leased Premises, of any insurance organization or company,
necessary for the maintenance of reasonable property damage and commercial
general liability insurance, covering the Leased Premises, the Building, or the
Complex.

     13.2  Increase in Premiums. Tenant agrees to pay Landlord, as additional
           --------------------
Rent, within ten (10) days after receipt by Tenant of Landlord's billing
therefor, any increase in premiums for insurance policies which may be carried
by Landlord on the Leased Premises, Building or Complex resulting from any
negligent or intentional act or omission of Tenant or any of its contractors,
partners, officers, employees or agents.

     13.3  Personal Property Insurance. Tenant shall maintain in full force and
           ---------------------------
effect on all of its fixtures, furniture, equipment and other business personal
property in the Leased Premises a policy or policies providing protection
against any peril included within the classification "All Risk" to the extent of
at least ninety percent (90%) of their replacement cost, or that percentage of
the replacement cost required to negate the effect of a co-insurance provision,
whichever is greater. No such policy shall have a deductible in a greater amount
than FIVE THOUSAND DOLLARS ($5,000.00). Tenant shall also insure in the same
manner the physical value of all its leasehold improvements and alterations in
the Leased Premises. During the term of this Lease, the proceeds from any such
policy or policies of insurance shall be used for the repair or replacement of
the fixtures, equipment, and leasehold improvements so insured. Landlord shall
have no interest in said insurance, and will sign all documents necessary or
proper in connection with the settlement of any claim or loss by Tenant. Tenant
shall also maintain business interruption insurance and insurance for all plate
glass (except for the exterior windows) upon the Leased Premises. All insurance
specified in this Section 13.3 to be maintained by Tenant shall be maintained by
Tenant at its sole cost.

     13.4  Landlord's Insurance. In addition to any other insurance Landlord
           --------------------
elects to maintain, Landlord agrees to maintain standard fire and extended
coverage insurance covering the Building in an amount not less than ninety
percent (90%) of the replacement cost thereof (or such greater percentage as may
be necessary to comply with the provisions of any co-insurance clauses of the
policy). Such insurance shall be issued in the names of Landlord and its lender,
as their interests appear, and shall be for the sole benefit of such parties and
under their sole control.

                                       20
<PAGE>

         ARTICLE 14 INDEMNIFICATION, WAIVER OF CLAIMS AND SUBROGATION

     14.1  Intent and Purpose. This Article 14 is written and agreed to in
           ------------------
respect of the intent of the parties to assign the risk of loss, whether
resulting from negligence of the parties or otherwise, to the party who is
obligated hereunder to cover the risk of such loss with insurance. Thus, the
indemnity and waiver of claims provisions of this Lease have as their object, so
long as such object is not in violation of public policy, the assignment of risk
for a particular casualty to the party carrying the insurance for such risk,
without respect to the causation thereof.

     14.2  Waiver of Subrogation. Landlord and Tenant release each other, and
           ---------------------
their respective authorized representatives, from any claims for damage to the
Leased Premises and the Building and other improvements in which the Leased
Premises are located, and to the furniture, fixtures, and other business
personal property, Tenant's improvements and alterations of either Landlord or
Tenant, in or on the Leased Premises and the Building and other improvements in
which the Leased Premises are located, including loss of income, that are caused
by or result from risks insured or required under the terms of this Lease to be
insured against under any property insurance policies carried or to be carried
by either of the parties.

     14.3  Form of Policy. Each party shall cause each such insurance policy
           --------------
obtained by it to provide that the insurance company waives all rights of
recovery by way of subrogation against either party in connection with any
damage covered by such policy. Neither party shall be liable to the other for
any damage caused by any peril included within the classification "All Risk"
which is insured against under any property insurance policy carried under the
terms of this Lease.

     14.4  Indemnity. Tenant, as a material part of the consideration to be
           ---------
rendered to Landlord, shall indemnify, defend, protect and hold harmless
Landlord against all actions, claims, demands, damages, liabilities, losses,
penalties, or expenses of any kind which may be brought or imposed upon Landlord
or which Landlord may pay or incur by reason of (a) injury or death to person or
damage to property, from whatever cause, including, without limitation, the
negligence of the parties hereto, all or in any way connected with the condition
or use of the Leased Premises, or the improvements or personal property therein
or thereon, including without limitation any liability or injury to the person
or property of Tenant, its agents, officers, employees or invitees, and (b) any
injury or death to any person or damage to property caused by the negligence of
Tenant or any of its officers, partners, employees or agents anywhere in the
Complex. Nothing contained herein shall obligate Tenant to indemnify Landlord
against the gross negligence or willful acts of Landlord or its officers,
employees or agents. Landlord agrees to indemnify Tenant for all actions,
claims, demands, liabilities, losses, costs and expenses arising out of the
gross negligence or willful misconduct of Landlord or its officers, employees
and agents anywhere in the Complex and the active negligence of Landlord or its
officers, employees or agents in the Common Areas of the Complex.

     14.5  Defense of Claims. In the event any action, suit or proceeding is
           -----------------
brought against Landlord by reason of any such occurrence, Tenant, upon
Landlord's request, will at Tenant's expense resist and defend such action, suit
or proceeding, or cause the same to be resisted and defended by counsel
designated either by Tenant or by the insurer whose policy covers the occurrence
and in either case approved by Landlord. The obligations of Tenant under this
Section arising by reason of any occurrence taking place during the Lease term
shall survive any termination of this Lease.

     14.6  Waiver of Claims. Tenant, as a material part of the consideration to
           ----------------
be rendered to Landlord, hereby waives all claims against Landlord for damages
or injury, as described below, from any cause arising at any time, including
breach of the provisions of this Lease and the negligence of the parties hereto
except to the extent such damages or injury are caused by the gross negligence
or willful actions of Landlord, its agents, officers and employees:

                                       21
<PAGE>

          (a) damages to goods, Wares, merchandise and loss of business in, upon
or about the Leased Premises and injury to Tenant, its agents, employees,
invitees or third persons, in, upon or about the Leased Premises, Building or
Complex; and

          (b) (notwithstanding anything to the contrary contained in this Lease,
including, without limitation, the definition of Operating Costs which includes
"policing") damages to goods, wares, merchandise and loss of business, in, upon
or about the Leased Premises or the Complex, and injury to Tenant, its agents,
employees, invitees or third persons in, upon or about the Leased Premises or
the Complex, where such damage or injury results from Landlord's failure to
police or provide security for the Complex or Landlord's negligence in
connection therewith.

     14.7  References. Wherever in this Article the term Landlord or Tenant is
           ----------
used and such party is to receive the benefit of a provision contained in this
Article, such term shall refer not only to that party but also to its
shareholders, officers, directors, employees, partners, members, managers,
mortgagees and agents.

                        ARTICLE 15 LIABILITY INSURANCE

     15.1  Tenant's Insurance. Tenant shall, at Tenant's expense, obtain and
           ------------------
keep in force during the term of this Lease, a commercial general liability
insurance policy insuring Tenant against the risks of, bodily injury and
property damage, personal injury, contractual liability, completed operations,
products liability, host liquor liability, owned and non-owned automobile
liability arising out of the ownership, use, occupancy or maintenance of the
Leased Premises and all areas appurtenant thereto. Such insurance shall be a
combined single limit policy in an amount not less than ONE MILLION DOLLARS
($1,000,000.00) per occurrence with a TWO MILLION DOLLAR ($2,000,000.00) annual
aggregate. Landlord and any lender and any other party in interest designated by
Landlord shall be named as additional insured(s). The policy shall contain cross
liability endorsements with coverage for Landlord for the negligence of Tenant
even though Landlord is named as an additional insured; shall insure performance
by Tenant of the indemnity provisions of this Lease; shall be primary, not
contributing with, and not in excess of coverage which Landlord may carry; shall
provide for severability of interest; shall provide that an act or omission of
one of the insured or additional insureds which would void or otherwise reduce
coverage shall not void or reduce coverages as to the other insured or
additional insureds; and shall afford coverage after the term of this Lease (by
separate policy or extension if necessary) for all claims based on acts,
omissions, injury or damage which occurred or arose (or the onset of which
occurred or arose) in whole or in part during the term of this Lease. The limits
of said insurance shall not limit any liability of Tenant hereunder. Not more
frequently than every year, if, in the reasonable opinion of Landlord, the
amount of liability insurance required hereunder is not adequate, Tenant shall
promptly increase said insurance coverage as required by Landlord.

     15.2  Workers' Compensation Insurance. Tenant shall carry Workers'
           -------------------------------
Compensation insurance as required by law, including an employers' liability
endorsement.

         ARTICLE 16 INSURANCE POLICY REQUIREMENTS & INSURANCE DEFAULTS

     16.1  General Requirements. All insurance policies required to be carried
           --------------------
by Tenant (except Tenant's business personal property insurance) hereunder shall
conform to the following requirements:

          (a) The insurer in each case shall carry a designation in "Best's
Insurance Reports" as issued from time to time throughout the term as follows:
Policyholders' rating of A; financial rating of not less than VII;

          (b) The insurer shall be qualified to do business in the state in
which the Leased Premises are located;

                                       22
<PAGE>

          (c) The policy shall be in a form and include such endorsements as are
acceptable to Landlord;

          (d) Certificates of insurance shall be delivered to Landlord at
commencement of the term and certificates of renewal at least thirty (30) days
prior to the expiration of each policy;

          (e) Each policy shall require that Landlord be notified in writing by
the insurer at least thirty (30) days prior to any cancellation or expiration of
such policy, or any reduction in the amounts of insurance carried.

     16.2  Tenant's Insurance Defaults. If Tenant fails to obtain any insurance
           ---------------------------
required of it under the terms of this Lease, Landlord may, at its option, but
is not obligated to, obtain such insurance on behalf of Tenant and bill Tenant,
as additional rent, for the cost thereof. Payment shall be due within ten (10)
days of receipt of the billing therefor by Tenant.

                       ARTICLE 17 FORFEITURE OF PROPERTY

     17.1  Removal of Personal Property. Tenant agrees that as at the date of
           ----------------------------
termination of this Lease or repossession of the Leased Premises by Landlord, by
way of default or otherwise, it shall remove all personal property to which it
has the right to ownership pursuant to the terms of this Lease. Any and all such
property of Tenant not removed by such date shall, at the option of Landlord,
irrevocably become the sole property of Landlord. Tenant waives all rights to
notice and all common law and statutory claims and causes of action which it may
have against Landlord subsequent to such date as regards the storage,
destruction, damage, loss of use and ownership of the personal property affected
by the terms of this Article. Tenant acknowledges Landlord's need to relet the
Leased Premises upon termination of this Lease or repossession of the Leased
Premises and understands that the forfeitures and waivers provided herein are
necessary to aid said reletting, and to prevent Landlord incurring a loss for
inability to deliver the Leased Premises to a prospective Tenant.

                      ARTICLE 18 MAINTENANCE AND REPAIRS

     18.1  Landlord's Obligations. Subject to the other provisions of this Lease
           ----------------------
imposing obligations in this respect upon Tenant, Landlord shall repair, replace
and maintain the external and Structural parts of the Building and Common Areas
of the Complex which do not comprise a part of the Leased Premises and are not
leased to others, janitor and equipment closets and shafts within the Leased
Premises designated by Landlord for use by it in connection with the operation
and maintenance of the Complex, and all Common Areas. Landlord shall perform
such repairs, replacements and maintenance with reasonable dispatch, in a good
and workmanlike manner; but Landlord shall not be liable for any damages,
direct, indirect or consequential, or for damages for personal discomfort,
illness or inconvenience of Tenant by reason of failure of such equipment,
facilities or systems or reasonable delays in the performance of such repairs,
replacements and maintenance, unless caused by the gross negligence or
deliberate act or omission of Landlord. The cost for such repairs, maintenance
and replacement shall be included in Operating Costs.

     18.2  Negligence of Tenant. If the Building, the elevators, boilers,
           --------------------
engines, pipes or apparatus used for the purpose of climate control of the
Building or operating the elevators, or if the water pipes, drainage pipes,
electric lighting or other equipment of the Building, or the roof or the outside
walls of the Building, fall into a state of disrepair or become damaged or
destroyed through the gross negligence or intentional act of Tenant, its agents,
officers, partners, employees or servants, the cost of the necessary repairs,
replacements or alterations shall be borne by Tenant who shall pay the same to
Landlord as additional charges forthwith on demand, except to the extent
provided in section 14.2 (the waiver of subrogation) hereof.

     18.3  Tenant's Obligations. Tenant shall repair the Leased Premises,
           --------------------
including without limiting the generality of the foregoing, all interior
partitions and walls, fixtures, Leasehold Improvements and alterations in the
Leased Premises, fixtures and shelving, and special mechanical and electrical
equipment which equipment

                                       23
<PAGE>

is not a normal part of the Leased Premises installed by or for Tenant,
reasonable wear and tear, damage with respect to which Landlord has an
obligation to repair as provided in Section 18.1 and Section 19 hereof only
excepted. Landlord may enter and view the state of repair and Tenant will repair
in a good and workmanlike manner according to notice in writing.

     18.4  Cleaning. Tenant agrees at the end of each business day to leave the
           --------
Leased Premises in a reasonably clean condition for the purpose of the
performance of Landlord's cleaning services referred to herein.

     18.5  Waiver. Tenant waives all rights it may have under law to make
           ------
     repairs at Landlord's expense.

     18.6  Acceptance. Except as to the construction obligations of Landlord, if
           ----------
any, stated in Exhibit C to this Lease, Tenant shall accept the Leased Premises
in "as is" condition as of the date of execution of this Lease by Tenant, and
subject to the punch list items referenced in section 4.5, Tenant acknowledges
that the Leased Premises in such condition are in good and sanitary order,
condition and repair.

                            ARTICLE 19 DESTRUCTION

     19.1  Rights of Termination. In the event the Leased Premises suffers (a)
           ---------------------
an "uninsured property loss" (as hereinafter defined) or (b) a property loss
which cannot be repaired within one hundred eighty (180) days from the date of
destruction under the laws and regulations of state, federal, county or
municipal authorities, or other authorities with jurisdiction, Landlord or
Tenant may terminate this Lease as of the date of the damage within twenty (20)
days of written notice from Landlord to Tenant that the damage from the casualty
was an uninsured property loss or that time to restore will exceed such one
hundred eighty (180) day period. For purposes of this Lease, the term "uninsured
property loss" shall mean any loss arising from a peril not covered by the
standard form of "All Risk" property insurance policy:

     19.2  Repairs. In the event of a property loss which may be repaired within
           -------
one hundred eight (180) days from the date of the damage, or, in the
alternative, in the event the parties do not elect to terminate this Lease under
the terms of Section 19.1 above, then this Lease shall continue in full force
and effect and Landlord shall forthwith undertake to make such repairs to
reconstitute the Leased Premises to as near the condition as existed prior to
the property loss as practicable. Such partial destruction shall in no way annul
or void this Lease except that Tenant shall be entitled to a proportionate
reduction of Minimum Monthly Rent following the property loss and until the time
the Leased Premises are restored. Such reduction shall be based on the ratio
that the square footage of the damaged portion of the Leased Premises bears to
the total square footage of the Leased Premises. Landlord's obligations to
restore shall in no way include any construction originally performed by Tenant
or subsequently undertaken by Tenant, but shall include solely that property
constructed by Landlord prior to commencement of the Term hereof.

     19.3  Repair Costs. The cost of any repairs to be made by Landlord,
           ------------
pursuant to Section 19.2 of this Lease, shall be paid by Landlord utilizing
available insurance proceeds. Tenant shall reimburse Landlord upon completion of
the repairs for any deductible for which no insurance proceeds will be obtained
under Landlord's insurance policy, or if other premises are also repaired, a pro
rata share based on total costs of repair equitably apportioned to the Leased
Premises. Tenant shall, however, not be responsible to pay any deductible or its
share of any deductible to the extent that Tenant's payment would be in excess
of $10,000 if Tenant's consent has not been received by Landlord, unless such
denial of consent by Tenant is unreasonable.

     19.4  Waiver. Tenant hereby waives all statutory or common law rights of
           ------
termination in respect to any partial destruction or property loss which
Landlord is obligated to repair or may elect to repair under the terms of this
Article.

                                       24
<PAGE>

     19.5  Landlord's Election. In the event that the Complex or Building is
           -------------------
destroyed to the extent of not less than thirty-three and one-third percent (33-
1/3%) of the replacement cost thereof, Landlord may elect to terminate this
Lease, whether the Leased Premises be injured or not, in the same manner as in
Section 19.1 above. In all events, a total destruction of the Complex or
Building shall terminate this Lease.

     19.6  Damage Near End of Term. If at any time during the last twelve (12)
           -----------------------
months of the term of this Lease there is, in Landlord's sole opinion,
substantial damage to the Leased Premises or the Building, whether or not such
casualty is covered in whole or in party by insurance, Landlord may at
Landlord's option cancel and terminate this Lease as of the date of Occurrence
of such damage by giving written notice to Tenant of Landlord's election to do
so within thirty (30) days after the date of occurrence of such damage and
Landlord shall have no further liability hereunder. Substantial damage shall be
defined as damage that will cost over $50,000.00 to repair.

                            ARTICLE 20 CONDEMNATION

     20.1  Definitions.
           -----------

          (a) "Condemnation" means (i) the exercise of any governmental power,
whether by legal proceedings or otherwise, by a condemnor and/or (ii) a
voluntary sale or transfer by Landlord to any condemnor, either under threat of
condemnation or while legal proceedings for condemnation are pending.

          (b) "Date of taking" means the date the condemnor has the right to
possession of the property being condemned.

          (c) "Award" means all compensation, sums or anything of value awarded,
paid or received on a total or partial condemnation.

          (d) "Condemnor" means any public or quasi-public authority, or private
corporation or individual, having the power of condemnation.

     20.2  Total Taking. If the Leased Premises are totally taken by
           ------------
condemnation, this Lease shall terminate on the date of taking.

     20.3  Partial Taking; Common Areas.
           ----------------------------

          (a) If any portion of the Leased Premises is taken by condemnation,
this Lease shall remain in effect, except that Tenant can elect to terminate
this Lease if 33-1/3% or more of the total number of square feet in the Leased
Premises is taken.

          (b) If any part of the Common Areas of the Complex is taken by
condemnation, this Lease shall remain in full force and effect so long as there
is no material interference with the access to the Leased Premises, except that
if thirty percent (30%) or more of the Common Areas is taken by condemnation,
Landlord or Tenant shall have the election to terminate this Lease pursuant to
this Section.

          (c) If fifty percent (50%) or more of the Building in which the Leased
Premises are located is taken, Landlord shall have the election to terminate
this Lease in the manner prescribed herein.

     20.4  Termination or Abatement. If either party elects to terminate this
           ------------------------
Lease under the provisions of Section 20.3 (such party is hereinafter referred
to as the "Terminating Party"), it must terminate by giving notice to the other
party (the "Nonterminating Party") within thirty (30) days after the nature and
extent of the taking have been finally determined (the "Decision Period"). The
Terminating Party shall notify the Nonterminating Party of the date of
termination, which date shall not be earlier than one hundred twenty (120) days
after the Terminating Party has notified the Nonterminating Party of its
election to terminate nor later than

                                       25
<PAGE>

the date of taking. If Notice of Termination is not given within the Decision
Period, the Lease shall continue in full force and effect except that Minimum
Monthly Rent shall be reduced by subtracting therefrom an amount calculated by
multiplying the Minimum Monthly Rent in effect prior to the taking by a fraction
the numerator of which is the number of square feet taken from the Leased
Premises and the denominator of which is the number of square feet in the Leased
Premises prior to the taking.

     20.5  Restoration. If there is a partial taking of the Leased Premises and
           -----------
this Lease remains in full force and effect pursuant to this Article, Landlord,
at its cost, shall accomplish all necessary restoration so that the Leased
Premises is returned as near as practical to its condition immediately prior to
the date of the taking, but in no event shall Landlord be obligated to expend
more for such restoration than the extent of funds actually paid to Landlord by
the condemnor.

     20.6  Award. Any award arising from the condemnation or the settlement
           -----
thereof shall belong to and be paid to Landlord except that Tenant shall receive
from the award compensation for the following if specified in the award by the
condemning authority, so long as it does not reduce Landlord's award in respect
of the real property Tenant's trade fixtures, tangible personal property,
goodwill, loss of business and relocation expenses. At all events, Landlord
shall be solely entitled to all award in respect of the real property, including
the bonus value of the leasehold. Tenant shall not be entitled to any award
until Landlord has received the above sum in full.

                     ARTICLE 21 ASSIGNMENT AND SUBLETTING

     21.1  Lease is Personal. The purpose of this Lease is to transfer
           -----------------
possession of the Leased Premises to Tenant for Tenant's personal use in return
for certain benefits, including rent, to be transferred to the Landlord. Tenant
acknowledges and agrees that it has entered into this Lease in order to occupy
the Leased Premises for its own personal use and not for the purpose of
obtaining the right to assign or sublet the leasehold to others.

     21.2  "Transfer of the Leased Premises" Defined. Except for an Affiliated
            ----------------------------------------
Transfer described in section 21.5 hereof, the terms "Transfer of the Leased
Premises" or "Transfer" as used herein shall include any assignment of all or
any part this Lease (including an assignment by operation of law), subletting of
all or any part the Leased Premises or transfer of possession, or right of
possession or contingent right of possession of all or any portion of the Leased
Premises including, without limitation, concession, mortgage, deed of trust,
devise, hypothecation, agency, franchise or management agreement, or the
occupancy or use by any other person (the agents and servants of Tenant
excepted) of any portion of the Leased Premises. If Tenant is a corporation
which is not deemed a public corporation, or is an unincorporated association,
partnership or limited liability company or partnership, or consists of more
than one party, the transfer, assignment or hypothecation of any stock or
interest in such corporation, association, partnership, limited liability
company or ownership interest, in the aggregate (whether in a single transaction
or series of separate but related transactions over a period of time) of twenty-
five percent (25%) or more, shall be deemed a Transfer of the Leased Premises.

     21.3  No Transfer Without Consent. Except for an Affiliated Transfer
           ---------------------------
described in section 21.5 hereof, Tenant Shall not suffer a Transfer of the
Leased Premises or any interest therein, or any part thereof, or any right or
privilege appurtenant thereto without the prior written consent of Landlord, and
a consent to one Transfer of the Leased Premises shall not be deemed to be a
consent to any subsequent Transfer of the Leased Premises. Any Transfer of the
Leased Premises without such consent shall be void, and shall, at the option of
Landlord, terminate this Lease. Any Transfer of the Leased Premises without such
consent shall (i) be voidable, and (ii) terminate this Lease, in either case, at
the option of Landlord. The consent by Landlord to any Transfer shall not
include consent to the assignment or transferring of any lease renewal option
rights or space option rights of the Leased Premises, special privileges or
extra services granted to Tenant by this Lease, or addendum or amendment thereto
or letter of agreement (and such options, rights, privileges or services shall
terminate upon such assignment), unless Landlord specifically grants in writing
such options, rights, privileges or services to such assignee or subtenant.

                                       26
<PAGE>

21.4  When Consent Granted. The consent of Landlord to a Transfer may not be
      --------------------
unreasonably withheld, provided that it is agreed to be reasonable for Landlord
to consider any of the following reasons, which list is not exclusive, in
electing to deny consent:

          (a) The financial strength of the proposed transferee at the time of
the proposed Transfer is not at least equal to that of Tenant at the time of
execution of this Lease;

          (b) A proposed transferee whose occupation of the Leased Premises
would cause a diminution in the reputation of the Complex or the other
businesses located therein;

          (c) A proposed transferee whose impact or affect on the common
facilities or the utility, efficiency or effectiveness of any utility or
telecommunication system serving the Building or the Complex or the other
occupants of the Complex would be adverse, disadvantageous or require
improvements or changes in any utility or telecommunication capacity currently
serving the Building or the Complex;

          (d) A proposed transferee whose occupancy will require a variation in
the terms of this Lease (including, without limitation, a variation in the use
clause) or which otherwise adversely affects any interest of Landlord;

          (e) Tenant agrees that its personal business skills and philosophy
were an important inducement to Landlord for entering into the Lease and that
Landlord may reasonably object to the Transfer of the Leased Premises to another
whose proposed use, while permitted by the Use clause of this Lease, would
involve a quality, manner or type of business skills different from those of
Tenant;

          (f) The existence of any default by Tenant under any provision of this
Lease; or

          (g) A proposed transferee who is or is likely to be, or whose business
is or is likely to be, subject to compliance with additional laws or other
governmental requirements beyond those to which Tenant or Tenant's business is
subject.

     21.5  Affiliated Transfer. Notwithstanding the foregoing, Tenant shall have
           -------------------
the right, without the consent of Landlord, but upon prior written notice to
Landlord, to assign this Lease or sublet the Leased Premises: (a) to a company
or other entity organized or to be organized by Tenant, provided that Tenant
owns or beneficially controls all of the issued and outstanding shares of stock
or interests of the company or other entity; (b) to any corporation or entity
which controls, is controlled by, or is under common control with the original
Tenant under this Lease; or (c) to a successor corporation which results from a
merger, consolidation or other non-bankruptcy or insolvency reorganization in
which Tenant is not the surviving corporation, so long as the surviving
corporation has a net worth at the time of such assignment that is equal to or
greater than the net worth of Tenant immediately prior to such transaction. In
addition, if Tenant becomes a publicly held corporation whose stock is listed on
a national stock exchange or is regularly traded in the over-the-counter market
and quoted on NASDAQ, the transfer of shares in Tenant in connection with its
public offering shall not be deemed a transfer requiring the consent of
Landlord. Any Transfer under this section shall be referred to as an "Affiliated
Transfer" and any transferee of an Affiliated Transfer shall be referred to as
an "Affiliated Transferee."

     21.6  Procedure for Obtaining Consent. With respect to a Transfer requiting
           -------------------------------
Landlord's consent, Landlord need not commence its review of any proposed
Transfer, or respond to any request by Tenant with respect to such, unless and
until it has received from Tenant adequate descriptive information concerning
the business to be conducted by the proposed transferee, the transferee's
financial capacity, and such other information as may reasonably be required in
order to form a prudent judgment as to the acceptability of the proposed
Transfer, including, without limitation, the following:

                                       27
<PAGE>

          (a) The past two years' audited annual Balance Sheets and Profit and
Loss statements, certified correct by a Certified Public Accountant for such
transfer, or if such transferee is privately owned company and does not have
such audited statements, then the past two years' Federal Income Tax returns of
the proposed transferee);

          (b) Banking references of the proposed transferee;

          (c) A resume of the business background and experience of the proposed
transferee;

          (d) At least five (5) business and three (3) personal references for
the proposed transferee; and

          (e) An executed copy of the instrument by which Tenant proposes to
effectuate the Transfer.

     21.7  Recapture. By written notice to Tenant (the "Termination Notice")
           ---------
within thirty (30) days following submission to Landlord by Tenant of the
information specified in section 21.6, Landlord may (1) terminate this Lease in
the event of an assignment of this Lease or sublet of the entire Leased
Premises, or (2) terminate this Lease as to the portion of the Leased Premises
to be sublet, if the sublet is to be of less than the entire Leased Premises. If
Landlord elects to terminate under the provisions hereof, and the area to be
terminated is less than the entire Leased Premises, an amendment to this Lease
shall be executed in which Tenant's obligations for rent and other charges shall
be reduced in proportion to the reduction in the size of the Leased Premises
caused thereby by restating the description of the Leased Premises, and its
monetary obligations hereunder shall be reduced by multiplying such obligations
by a fraction, the numerator of which is the Rentable Area of the Leased
Premises offered for sublease and the denominator of which is the Rentable Area
of the Leased Premises immediately prior to such termination, as determined by
Landlord in its sole and absolute discretion. The provisions of this section
shall not apply to an Affiliated Transfer under Section 21.5 hereof.

     21.8  Reasonable Restriction. The restrictions on Transfer described in
           ----------------------
this Lease are acknowledged by Tenant to be reasonable for all purposes,
including, without limitation, the provisions of California Civil Code (the
"Code") Section 1951.4(b)(2). Tenant expressly waives any rights which it might
otherwise be deemed to possess pursuant to applicable law, including, without
limitation, Section 1997.040 of the Code, to limit any remedy of Landlord
pursuant to Section 1951.2 or 1951.4 of the Code by means of proof that
enforcement of a restriction on use of the Leased Premises would be
unreasonable.

     21.9  Effect of Transfer. If Landlord consents to a Transfer and does not
           ------------------
elect to recapture as provided in section 21.7, the following conditions shall
apply:

          (a) Each and every covenant, condition or obligation imposed upon
Tenant by this Lease and each and every right, remedy or benefit afforded
Landlord by this Lease shall not be impaired or diminished as a result of such
Transfer.

          (b) Tenant shall pay to Landlord on a monthly basis, eighty percent
(80%) of the excess of any sums of money, or other economic consideration
received by Tenant from the Transferee in such month (whether or not for a
period longer than one month), including higher rent, bonuses, key money, or the
like over the aggregate of (i) the amortized portion of the reasonable and
customary expenses actually paid by Tenant to unrelated third parties for
brokerage commissions, attorney's fees and design fees incurred as a direct
consequence of the Transfer, and (ii) the total sums which Tenant pays Landlord
under this Lease in such month, or the prorated portion thereof if the Leased
Premises transferred is less than the entire Leased Premises. The amount so
derived shall be paid with Tenant's payment of Minimum Monthly Rent. The term
"amortized portion" is that portion of the applicable expenses derived by
dividing such expenses by the number of months in the original term (excluding
extension options) of the Transfer transaction.

                                       28
<PAGE>

          (c)  No Transfer, whether or not consent of Landlord is required
hereunder, shall relieve Tenant of its primary obligation to pay the rent and to
perform all other obligations to be performed by Tenant hereunder. The
acceptance of rent by Landlord from any person shall not be deemed to be a
waiver by Landlord of any provision of this Lease or to be a consent to any
Transfer of the Leased Premises.

          (d)  If Landlord consents to a sublease, such sublease shall not
extend beyond the expiration of the Term of this Lease.

          (e)  No Transfer shall be valid and no transferee shall take
possession of the Leased Premises or any part thereof unless, Tenant shall
deliver to Landlord, at least ten (10) days prior to the effective date of such
Transfer, a duly executed duplicate original of the Transfer instrument in form
satisfactory to Landlord which provides that (i) the transferee in cases of an
assignment assumes Tenant's obligations for the payment of rent and for the full
and faithful observance and performance of the covenants, terms and conditions
contained herein, (ii) such transferee will, at Landlord's election, attorn
directly to Landlord in the event Tenant's Lease is terminated for any reason on
the terms set forth in the instrument of transfer and (iii) such instrument of
transfer contains such other assurances as Landlord reasonably deems necessary.

     21.10  Costs. Tenant shall reimburse Landlord as additional rent for
            -----
Landlord's reasonable costs and attorneys' fees incurred in conjunction with the
processing and documentation of any proposed Transfer of the Leased Premises,
whether or not consent is granted.

                          ARTICLE 22 ENTRY BY LESSOR

     22.1  Rights of Landlord. Tenant shall permit Landlord and Landlord's
           ------------------
agents and any mortgagee under a mortgage or beneficiary under a deed of trust
encumbering the Building containing the Leased Premises and such party's agents
to enter the Leased Premises at all reasonable times for the purpose of (a)
inspecting the same, (b) maintaining the Building, (c) making repairs,
replacements, alterations or additions to any portion of the Building, including
the erection and maintenance of such scaffolding, canopies, fences and props as
may be required, (d) posting notices of non-responsibility for alterations,
additions or repairs, (c) placing upon the Building any usual or ordinary "for
sale" signs and showing the space to prospective purchasers, investors and
lenders, without any rebate of rent and without any liability to Tenant for any
loss of occupation or quiet enjoyment of the Leased Premises thereby occasioned,
and (e) placing on the Leased Premises any "to let" or "to lease" signs and
marketing and showing the Leased Premises to prospective tenants at any time
within six (6) months prior to the expiration of this Lease. This Section in no
way affects the maintenance obligations of the parties hereto.

                               ARTICLE 23 SIGNS

     23.1  Approval, Installation and Maintenance. Tenant shall not place on the
           --------------------------------------
Leased Premises or on the Building or Common Areas of the Complex, any exterior
signs or advertisements nor any interior signs or advertisements that are
visible from the exterior of the Leased Premises, without Landlord's prior
written consent, which Landlord reserves the right to withhold for any aesthetic
or other reason in its sole and absolute discretion. The cost of installation
and regular maintenance of any such signs approved by Landlord shall be at the
sole expense of Tenant, except that the cost to place Tenant's name in the
directory(ies) for the Building shall be included as part of the Operating
Costs. At the termination of this Lease, or any extension thereof, Tenant shall
remove all its signs (other than the its name in the directory(ies) for the
Building), and all damage caused by such removal shall be repaired at Tenant's
expense.

                              ARTICLE 24 DEFAULT

     24.1  Definition. The occurrence of any of the following shall constitute a
           ----------
material default and breach of this Lease by Tenant:

                                       29
<PAGE>

          (a)  Payment. Any failure by Tenant to pay the rent or to make any
               -------
other payment required to be made by Tenant hereunder within five (5) days after
receipt of written notice;

          (b)  Other Covenants. A failure by Tenant to observe and perform any
               ---------------
other provision of this Lease to be observed or performed by Tenant, where such
failure continues for thirty (30) days after written notice thereof by Landlord
to Tenant; provided, however, that if the nature of the default is such that the
same cannot reasonably be cured within the thirty (30) day period allowed,
Tenant shall not be deemed to be in default if Tenant shall, within such thirty
(30) day period, commence to cure and thereafter diligently prosecute the same
to completion; or

          (c)  Receivership. Either (1) the appointment of a receiver (except a
               ------------
receiver appointed at the instance or request of Landlord) to take possession of
all or substantially all of the assets of Tenant, or (2) a general assignment by
Tenant for the benefit of creditors, or (3) any action taken or suffered by
Tenant under any insolvency or bankruptcy act shall constitute a breach of this
Lease by Tenant. In such event, Landlord may, at its option, declare this Lease
terminated and forfeited by Tenant, and Landlord shall be entitled to immediate
possession of the Leased Premises. Upon such notice of termination, this Lease
shall terminate immediately and automatically by its own limitation; or

          (d)  Multiple Defaults. Any two (2) failures by Tenant to observe and
               -----------------
perform any provision of this Lease after receipt of written notice of such
failure and the expiration of five (5) days without curing such failure (except
for any additional time period provided in paragraph (b) above) during any
calendar year during the term, as such may be extended, shall constitute, at the
option of Landlord, a separate and non-curable default.

                       ARTICLE 25 REMEDIES UPON DEFAULT

     25.1  Termination and Damages. In the event of any default by Tenant, then
           -----------------------
in addition to any other remedies available to Landlord herein or at law or in
equity, Landlord shall have the immediate option to terminate this Lease and all
rights of Tenant hereunder by giving written notice of such intention to
terminate. In the event that Landlord shall elect to so terminate this Lease,
then Landlord may recover from Tenant:

          (a)  The worth at the time of award of any unpaid rent which had been
earned at the time of such termination; plus

          (b)  The worth at the time of award of the amount by which the unpaid
rent which would have been earned after termination until the time of award
exceeds the amount of such rental loss Tenant proves could have been reasonably
avoided; plus

          (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
such rental loss that Tenant proves could be reasonably avoided; plus

          (d)  Any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligations
under this Lease or which in the ordinary course of events would be likely to
result therefrom; and

          (e)  At Landlord's election, such other amounts in addition to or in
lieu of the foregoing as may be permitted from time to time by the applicable
law in the state in which the Leased Premises are located.

     25.2  Definition. As used in subsections 26.1 (a) and (b) above, the "worth
           ----------
at the time of award" is computed by allowing interest at the rate of ten
percent (10%) per annum. As used in subsection 26.1(c) above, the "worth at the
time of award" is computed by discounting such amount at the discount rate of
the Federal Reserve Bank for the region in which the Complex is located at the
time of award plus one percent (1%).

                                       30
<PAGE>

     25.3  Personal Property. In the event of any default by Tenant, Landlord
           -----------------
shall also have the right and option, with or without terminating this Lease, to
do any one or combination of the following:

          (a)  to reenter the Leased Premises and remove all persons and
property from the Leased Premises;

          (b)  to have all of Tenant's fixtures, furniture, equipment,
improvements, additions, alterations and other personal property remain upon the
Leased Premises during the length of any default by Tenant or a lesser period;
or

          (c)  to require Tenant to forthwith remove such property.

          Landlord shall have the sole right to take exclusive possession of
such property and to use it, rent, or charge free, until all defaults are cured.
If Landlord shall remove property from the Leased Premises, Landlord may, in its
sole and absolute discretion, store such property in the Complex, in a public
warehouse or elsewhere. All costs incurred by Landlord under this section,
including, without limitation, those for removal and storage (including, without
limitation, charges imposed by Landlord for storage within the Complex), shall
be at the sole cost of and for the account of Tenant. The rights stated herein
are in addition to Landlord's rights described in Article 17.

     25.4  Recovery of Rent; Reletting.
           ---------------------------

          (a)  In the event of the vacation or abandonment of the Leased
Premises by Tenant or in the event that Landlord shall elect to reenter as
provided in Section 25.3 above, or shall take possession of the Leased Premises
pursuant to legal proceeding or pursuant to any notice provided by law, then if
Landlord does not elect to terminate this Lease as provided in Section 25.1
above, this Lease shall continue in effect for so long as Landlord does not
terminate Tenant's right to possession, and Landlord may enforce all its rights
and remedies under this Lease, including, without limitation, Landlord's right
from time to time, without terminating this Lease, to either recover all rental
as it becomes due or relet the Leased Premises or any part thereof for such term
or terms and at such rental or rentals and upon such other terms and conditions
as Landlord, in its sole discretion, may deem advisable with the right to make
alterations and repairs to the Leased Premises. Acts of maintenance or
preservation or efforts to relet the Leased Premises or the appointment of a
receiver upon initiation of Landlord or other legal proceeding granting Landlord
or its agent possession to protect Landlord's interest under this Lease shall
not constitute a termination of Tenant's right to possession.

          (b)  In the event that Landlord shall elect to so relet, then rentals
received by Landlord from such reletting shall be applied first, to the payment
of any indebtedness other than rent due hereunder from Tenant to Landlord;
second, to the payment of any cost of such reletting; third, to the payment of
the cost of any alterations and repairs to the Leased Premises; fourth, to the
payment of rent due and unpaid hereunder; and the residue, if any, shall be held
by Landlord and applied in payment of future rent as the same may become due and
payable hereunder. Should that portion of such rentals received from such
reletting during any month, which is applied by the payment of rent hereunder,
be less than the rent payable during that month by Tenant hereunder, then Tenant
shall pay such deficiency to Landlord immediately upon demand therefor by
Landlord. Such deficiency shall be calculated and paid monthly. Tenant shall
also pay to Landlord, as soon as ascertained, any costs and expenses incurred by
Landlord in such reletting or in making such alterations and repairs not covered
by the rentals received from such reletting.

          (c)  No reentry or taking possession of the Leased Premises or any
other action under this Section shall be construed as an election to terminate
this Lease unless a written notice of such intention be given to Tenant or
unless the termination thereof be decreed by a court of competent jurisdiction.
Notwithstanding any reletting without termination by Landlord because of any
default by Tenant, Landlord may at any time after such reletting elect to
terminate this Lease for any such default.

                                       31
<PAGE>

          (d)  Landlord has the remedy described in California Civil Code
Section 1951.4 (Landlord may continue Lease in effect after Tenant's breach and
abandonment and recover rent as it becomes due, if Tenant has right to sublet or
assign, subject only to reasonable limitations).

     25.5  No Waiver. Efforts by Landlord to mitigate the damages caused by
           ---------
Tenant's default in this Lease shall not constitute a waiver of Landlord's right
to recover damages hereunder, nor shall Landlord have any obligation to mitigate
damages hereunder.

     25.6  Curing Defaults. Should Tenant fail to repair, maintain, and/or
           ---------------
service the Leased Premises, or any part or contents thereof at any time or
times, or perform any other obligations imposed by this Lease or otherwise, then
after having given Tenant reasonable notice of the failure or failures and a
reasonable opportunity which in no case shall exceed thirty (30) days, to remedy
the failure, Landlord may perform or contract for the performance of the repair,
maintenance, or other Tenant obligation, and Tenant shall pay Landlord for all
direct and indirect costs incurred in connection therewith within ten (10) days
of receiving a bill therefor from Landlord.

     25.7  Cumulative Remedies. The various rights, options, election powers,
           -------------------
and remedies of Landlord contained in this Article and elsewhere in this Lease
shall be construed as cumulative and no one of them exclusive of any others or
of any legal or equitable remedy which Landlord might otherwise have in the
event of breach or default, and the exercise of one right or remedy by Landlord
shall not in any way impair its right to any other right or remedy.

                             ARTICLE 26 BANKRUPTCY

     26.1  Bankruptcy Events. If at any time during the term of this Lease there
           -----------------
shall be filed by or against Tenant in any court pursuant to any statute either
of the United States or of any state a petition in bankruptcy or insolvency or
for reorganization or for the appointment of a receiver or trustee of all or a
portion of Tenant's property, or if a receiver or trustee takes possession of
any of the assets of Tenant, or if the leasehold interest herein passes to a
receiver, or if Tenant makes an assignment for the benefit of creditors or
petitions for or enters into an arrangement (any of which are referred to herein
as "a bankruptcy event"), then the following provisions shall apply:

          (a)  Assume or Reject. At all events any receiver or trustee in
               ----------------
bankruptcy or Tenant as debtor in possession ("debtor") shall either expressly
assume or reject this Lease within the earlier of sixty (60) days following the
entry of an "Order for Relief" or such earlier period of time provided by law.

          (b)  Cure. In the event of an assumption of the Lease by a debtor,
               ----
receiver or trustee, such debtor, receiver or trustee shall immediately after
such assumption (1) cure any default or provide adequate assurances that
defaults will be promptly cured; and (2) compensate Landlord for actual
pecuniary loss or provide adequate assurances that compensation will be made for
actual pecuniary loss; and (3) provide adequate assurance of future performance.

          (c)  Adequate Assurance. For the purposes of paragraph 26.1 (b),
               ------------------
adequate assurance of future performance of all obligations under this Lease
shall include, but is not limited to:

               (1)  written assurance that rent and any other consideration due
under the Lease shall first be paid before any other of Tenant's costs of
operation of its business in the Leased Premises is paid;

               (2)  written agreement that assumption of this Lease will not
cause a breach of any provision hereof including, but not limited to, any
provision relating to use or exclusivity in this or any other Lease, or
agreement relating to the Leased Premises, or if such a breach is caused, the
debtor, receiver or trustee

                                       32
<PAGE>

will indemnify Landlord against such loss (including costs of suit and
attorneys' fees), occasioned by such breach;

          (d)  Landlord's Obligation. Where a default exists under the Lease,
               ---------------------
the party assuming the Lease may not require Landlord to provide services or
supplies incidental to the Lease before its assumption by such trustee or
debtor, unless Landlord is compensated under the terms of the Lease for such
services and supplies provided before the assumption of such Lease.

          (e)  Assignment. The debtor, receiver, or trustee may assign this
               ----------
Lease only if adequate assurance of future performance by the assignee is
provided, whether or not there has been a default under the Lease. Any
consideration paid by any assignee in excess of the rental reserved in the Lease
shall be the sole property of, and paid to, Landlord. Upon assignment by the
debtor or trustee, the obligations of the Lease shall be deemed to have been
assumed, and the assignee shall execute an assignment agreement on request of
Landlord.

          (f)  Fair Value. Landlord shall be entitled to the fair market value
               ----------
for the Leased Premises and the services provided by Landlord (but in no event
less than the rental reserved in the Lease) subsequent to the commencement of a
bankruptcy event.

          (g)  Reservation of Rights. Landlord specifically reserves any and all
               ---------------------
remedies available to Landlord in Article 25 hereof or at law or in equity in
respect of a bankruptcy event by Tenant to the extent such remedies are
permitted by law.

                         ARTICLE 27 SURRENDER OF LEASE

     27.1  No Merger. The voluntary or other surrender of this Lease by Tenant,
           ---------
or a mutual cancellation thereof, shall not work as a merger, and shall, at the
option of Landlord, terminate all or any existing subleases or subtenancies, or
may, at the option of Landlord, operate as an assignment to it of any or all
such subleases or subtenancies.

                       ARTICLE 28 LANDLORD'S EXCULPATION

     28.1  Limited Liability. In the event of default, breach, or violation by
           -----------------
Landlord (which term includes Landlord's partners, members, managers, co-
venturers, co-tenants, officers, directors, employees, agents, or
representatives) of any Landlord's obligations under this Lease, Landlord's
liability to Tenant shall be limited to its ownership interest in the Leased
Premises (or its interest in the Building, if applicable) or the proceeds of a
public sale of such interest pursuant to foreclosure of a judgment against
Landlord.

     28.2  No Recourse. Landlord (as defined in Section 28.1) shall not be
           -----------
personally liable for any deficiency beyond its interest in the Leased Premises.

                          ARTICLE 29 ATTORNEYS' FEES

     29.1  Attorneys' Fees. In the event of any litigation or arbitration (if
           ---------------
each party in its sole and absolute discretion elects to use arbitration)
proceeding between the parties with respect to this Lease, then all costs and
expenses, including without limitation, all reasonable professional fees such as
appraisers', accountants' and attorneys' fees, incurred by the prevailing party
therein shall be paid or reimbursed by the other party. The "prevailing party"
means the party determined by the court or arbitrator (if the parties elected to
use arbitration) to have most nearly prevailed, even if such party did not
prevail in all matters, not necessarily the one in whose favor a judgment is
rendered. Further, in the event of any default by a party under this Agreement
after notice and the expiration of the applicable cure period, such defaulting
party shall pay all the expenses and attorneys' fees incurred by the other party
in connection with such default, whether or not any litigation is

                                       33
<PAGE>

commenced. Should Landlord be named as a defendant or requested or required to
appear as a witness or produce any documents in any suit brought by Tenant
against any other party or against Tenant in connection with or arising out of
Tenant's occupancy hereunder, Tenant shall pay to Landlord its costs and
expenses incurred in such suit, including without limitation, all reasonable
professional fees such as appraisers', accountants' and attorneys' fees. The
provisions of this section shall survive the expiration or termination of this
Lease.

                              ARTICLE 30 NOTICES

     30.1  Writing. All notices, demands and requests required or permitted to
           -------
be given or made under any provision of this Lease shall be in writing and shall
be given or made by personal service or by mailing same by registered or
certified mail, return receipt requested, postage prepaid, or overnight by Fed
Ex or reputable courier which provides written evidence of delivery or other
means of confirmation of delivery (such as computer confirmation by Fed Ex), or
by facsimile with facsimile confirmation that the notice was sent, addressed to
the respective party at the address set forth in Section 1.2 of this Lease or at
such other address as the party may from time to time designate, by a written
notice sent to the other in the manner aforesaid.

     30.2  Effective Date. Any such notice, demand or request ("notice") shall
           --------------
be deemed given or made on the third day after the date so mailed.
Notwithstanding the foregoing, notice given by personal delivery or by fax to
the party at its address or fax number as aforesaid shall be deemed given on the
day on which delivery is made or the fax is sent, respectively. Notice given
overnight by a reputable courier service which provides written evidence of
delivery shall be deemed given on the business day immediately following deposit
with the courier service.

     30.3  Authorization to Receive. Each person and/or entity whose signature
           ------------------------
is affixed to this Lease as Tenant or as guarantor of Tenant's obligations
("obligor") designates such other obligor its agent for the purpose of receiving
any notice pertaining to this Lease or service of process in the event of any
litigation or dispute arising from any obligation imposed by this Lease.

               ARTICLE 31 SUBORDINATION AND FINANCING PROVISIONS

     31.1  Priority of Encumbrances. This Lease shall be subordinate to any
           ------------------------
ground lease, mortgage, deed of trust or any other hypothecation for security
now or hereafter placed upon the real property of which the Leased Premises are
a part and to any and all advances made on the security thereof and to all
renewals, modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Tenant's right to quiet possession of the
Leased Premises shall not be disturbed if Tenant is not in default and so long
as Tenant shall pay the rent and observe and perform all the provisions of this
Lease, unless this Lease is otherwise terminated pursuant to its terms. If any
mortgagee, trustee or ground lessor shall elect to have this Lease prior to the
lien of its mortgage, deed of trust or ground lease, and shall give written
notice thereof to Tenant, this Lease shall be deemed prior to such mortgage,
deed of trust or ground lease, whether this Lease is dated prior or subsequent
to the date of said mortgage, deed of trust or ground lease or the date of
recording thereof.

     31.2  Execution of Documents. Tenant agrees to execute any documents
           ----------------------
required to effectuate such subordination or to make this Lease prior to the
lien of any mortgage, deed of trust or ground lease, as the case may be. It is
understood by all parties that Tenant's failure to execute the subordination
documents referred to above may cause Landlord serious financial damage by
causing the failure of a financing or sale transaction.

     31.3  Attornment. If the holder of any ground lease, mortgage, deed of
           ----------
trust or security described above (or its successor-in-interest), enforces its
remedies provided by law or under the pertinent mortgage, deed of trust or
security instrument and succeeds to Landlord's interest in the Leased Premises,
Tenant shall, upon request of any person succeeding to the interest of such
lender as result of such enforcement, automatically

                                       34
<PAGE>

become the Tenant of said successor-in-interest without change in the terms or
other provisions of this Lease, provided, however, that said successor-in-
interest shall not be (i) bound by any payment of rent for more than thirty (30)
days in advance, except prepayment in the nature of security for the performance
by Tenant of its obligations under this Lease, (ii) liable for any act or
omission of any previous landlord (including Landlord), (iii) subject to any
offset, defense, recoupment or counterclaim that Tenant may have given to any
previous landlord (including Landlord), or (iv) liable for any deposit that
Tenant may have given to any previous landlord (including Landlord) that has
not, as such, been transferred to said successor-in-interest. Within ten (10)
days after receipt of request by said successor-in-interest, Tenant shall
execute and deliver an instrument or instruments confirming such attornment,
including a non-disturbance, attornment and subordination agreement in a form
required by any such successor-in-interest.

     31.4  Notice and Right to Cure Default. Tenant agrees to give any
           --------------------------------
mortgagee(s) and/or trust deed holders, by registered mail, a copy of any notice
of default served upon Landlord, provided that prior to such notice Tenant has
been notified, in writing (by way of Notice of Assignment of Rents and Leases,
or otherwise), of the address of such mortgagees and/or trust deed holders.
Tenant further agrees that if Landlord shall have failed to cure such default
within the time provided for in this Lease, then the mortgagees and/or trust
deed holders shall have an additional thirty (30) days within which to cure such
default or, if such default cannot be cured within that time, then such
additional time as may be necessary if, within such thirty (30) days, any
mortgagee and/or trust deed holder has commenced and is diligently pursuing the
remedies necessary to cure such default (including but not limited to
commencement of foreclosure proceedings, if necessary to effect such cure), in
which event this Lease shall not be terminated while such remedies are being so
diligently pursued.

                       ARTICLE 32 ESTOPPEL CERTIFICATES

     32.1  Execution by Tenant. Within ten (10) days after receipt of written
           -------------------
request by Landlord, Tenant shall execute and deliver to Landlord an estoppel
certificate acknowledging such facts regarding this Lease as Landlord may
reasonably require, including without limitation, that to the extent of Tenant's
knowledge (i) this Lease is in full force and effect, binding and enforceable in
accordance with its terms and unmodified (or if modified, specifying the written
modification documents); (ii) no default exists on the part of Landlord or
Tenant under this Lease; (iii) there are no events which with the passage of
time, or the giving of notice, or both, would create a default under this Lease;
(iv) no rent in excess of one month's rent has been paid in advance; (v) Tenant
has not received any written notice of any other sale, assignment, transfer,
mortgage or pledge of this Lease or the rent due hereunder; and (vi) Tenant has
no defense, setoff, recoupment or counterclaim against Landlord. Any such
estoppel certificate may be relied upon by Landlord, any lender and any
prospective purchaser of the Building or Complex or any interest therein. The
failure of Tenant to comply with this Article within ten (10) days after receipt
of a second written notice from Landlord shall be a material breach of this
Lease by Tenant giving Landlord all rights and remedies under this Lease, as
well as a right to damages caused by the loss of a loan or sale which may result
from such failure by Tenant.

     32.2  Financing. If Landlord desires to finance or refinance the Leased
           ---------
Premises, or ally part thereof, or the Building, Tenant hereby agrees to deliver
to any lender designated by Landlord financial statements of Tenant of the type
typically provided or available from a publicly held company to the extent such
statements are in Tenant's possession. Such statements shall include the past
three (3) years' financial statements of Tenant. All such financial statements
shall be received by Landlord and such lender in confidence and shall be used
only for the purposes herein set forth.

                      ARTICLE 33 MISCELLANEOUS PROVISIONS

     33.1  Effect of Waiver. The waiver by Landlord or Tenant of any breach of
           ----------------
any Lease provision by the other party shall not be deemed to be a waiver of
such Lease provision or any subsequent breach of the same or any other term,
covenant or condition therein contained. The subsequent acceptance of rent
hereunder by Landlord shall not be deemed to be a waiver of any preceding breach
by Tenant of any provision of this

                                       35
<PAGE>

Lease, other than the failure of Tenant to pay the particular rental so
accepted, regardless of Landlord's knowledge of such preceding breach at the
time of acceptance of such rent. Any failure by Landlord or Tenant to insist
upon strict performance by the other of this Lease of any of the terms and
provisions of the Lease or any guaranty of this Lease shall not be deemed to be
a waiver of any of the terms or provisions of the Lease or such guaranty, and
Landlord or Tenant, as the case may be, shall have the right thereafter to
insist upon strict performance by the other of any and all of them.

     33.2  Month-to-Month Tenancy on Acceptance. If Tenant should remain in
           ------------------------------------
possession of the Leased Premises after the expiration of the Lease term and
without executing a new Lease, then, upon acceptance of rent by Landlord, such
holding over shall be construed as a tenancy from month-to-month, subject to all
the conditions, provisions and obligations of this Lease as existed during the
last month of the term hereof, so far as applicable to a month to month tenancy,
except that the Minimum Monthly Rent shall be equal one hundred fifty percent
(150%) of the greater of (a) the Minimum Monthly Rent payable immediately prior
to the expiration or sooner termination of the Lease, or (b) the then fair
market rent; provided, however, that Tenant shall also be liable for any and all
damages suffered or sustained by Landlord as a result of such holdover,
including, without limitation, any loss of rental income from any other tenant
that was interested in leasing all or any portion of the Leased Premises,
brokerage commissions, design fees and any other damages as a result.
Additionally, in the event that upon termination of the Lease, Tenant has not
fulfilled its obligation with respect to repairs and cleanup of the Leased
Premises or any other Tenant obligations as set forth in this Lease, then
Landlord shall have the right to perform any such obligations as it deems
necessary at Tenant's sole cost and expense, and any time required by Landlord
to complete such obligations shall be considered a period of holding over and
the terms of this section shall apply.

     33.3  Binding Effect. The covenants and conditions herein contained shall,
           --------------
subject to the provisions as to assignment, apply to and bind the heirs,
successors, executors, administrators and assigns of all of the parties hereto;
and all of the parties hereto shall be jointly and severally liable hereunder.

     33.4  Time of the Essence. Time is of the essence of this Lease with
           -------------------
respect to each and every article, section and subsection hereof.

     33.5  Release of Landlord. If, during the term of this Lease, Landlord
           -------------------
shall sell its interest in the Building or Complex of which the Leased Premises
form a part, or the Leased Premises, then from and after the effective date of
the sale or conveyance, Landlord shall be released and discharged from any and
all obligations and responsibilities under this Lease, except those already
accrued and provided Landlord transfers or provides a credit or other payment to
such successor of the Security Deposit to the extent not previously applied by
Landlord under the terms of this Lease.

     33.6  Rules and Regulations. Landlord or such other person(s) as Landlord
           ---------------------
may appoint shall have the exclusive control and management of the Common Areas
and Building and shall have the right, from time to time, to establish, modify,
amend and enforce reasonable rules and regulations with respect thereto. Tenant
agrees to abide by and conform to all such rules and regulations, and to cause
its employees; suppliers, shippers, customers, and invitees to so abide and
conform. Landlord shall not be responsible to Tenant for the non-compliance with
said rules and regulations by other tenants of the Building or Complex.

     33.7  Transfer to Purchaser. If any security be given by Tenant to secure
           ---------------------
the faithful performance of all or any of the covenants of this Lease on the
part of Tenant, Landlord may transfer and/or deliver the security, as such, to
the purchaser of the reversion, in the event that the reversion be sold, and
thereupon Landlord shall be discharged from any further liability in reference
thereto.

     33.8  Late Charges. Tenant acknowledges that late payment by Tenant to
           ------------
Landlord of rent or any other payment due hereunder will Cause Landlord to incur
costs not contemplated by this Lease, the exact amount of such costs being
extremely difficult and impractical to fix. Such costs include, without
limitation,

                                       36
<PAGE>

processing and accounting charges, and late charges that may be imposed on
Landlord by the terms of any encumbrance and note secured by any encumbrance
covering the Leased Premises. Therefore, if any installment of rent, or any
other payment due hereunder from Tenant is not received by Landlord when due,
Tenant shall pay to Landlord an additional sum of ten percent (10%) of such rent
or other charge as a late charge. The parties agree that this late charge
represents a fair and reasonable estimate of the cost that Landlord will incur
by reason of late payment by Tenant. Acceptance of any late charge shall not
constitute a waiver of Tenant default with respect to the overdue amount, or
prevent Landlord from exercising any other rights or remedies available to
Landlord.

     33.9  Interest. Any amount owed by Tenant to Landlord which is not paid
           --------
when due shall bear interest at the lesser of ten percent (10%) per annum or the
maximum rate of interest permitted to be contracted for by law. However,
interest shall not be payable on late charges to be paid by Tenant under this
Lease. The payment of interest on such amounts shall not excuse or cure any
default by Tenant under this Lease.

     33.10  Authorization to Execute. If Tenant is a corporation, limited
            ------------------------
liability company, partnership or other entity, each individual executing this
Lease on behalf of said organization represents and warrants that he is duly
authorized to execute and deliver this Lease on behalf of said organization in
accordance with a duly adopted resolution or other applicable authorization of
said organization, and that this Lease is binding upon said organization in
accordance with its terms. Further, Tenant shall, within thirty (30) days after
execution of this Lease, deliver to Landlord a certified copy of a resolution or
other applicable authorization of said organization authorizing or ratifying the
execution of this Lease.

     33.11  Captions. The captions of this Lease are for convenience only and
            --------
are not a part of this Lease and do not in any way limit or amplify the terms
and provisions of this Lease.

     33.12  Number and Gender. Whenever the singular number is used in this
            -----------------
Lease and when required by the context, the same shall include the plural, the
plural shall include the singular, and the masculine gender shall include the
feminine and neuter genders, and the word "person" shall include corporation,
firm or association. If there be more than one Tenant, the obligations imposed
under this Lease upon Tenant shall be joint and several.

     33.13  Modifications. This instrument contains all of the agreements,
            -------------
conditions and representations made between the parties to this Lease and may
not be modified orally or in any other manner than by an agreement in writing
signed by all of the parties to this Lease.

     33.14  Payments. Except as otherwise expressly stated, each payment
            --------
required to be made by Tenant shall be in addition to and not in substitution
for other payments to be made by Tenant.

     33.15  Severability. The invalidity of any provision of this Lease, as
            ------------
determined by a court of competent jurisdiction, shall in no way affect the
validity of any other provision hereof.

     33.16  No offer. The preparation and submission of a draft of this Lease by
            --------
either party to the other shall not constitute an offer, nor shall either party
be bound to any terms of this Lease or the entirety of the Lease itself until
both parties have fully executed a final document and an original signature
document has been received by both parties. Until such time as described in the
previous sentence, either party is free to terminate negotiations with no
obligation to the other.

     33.17  Light, Air and View. No diminution of light, air, or view by any
            -------------------
structure which may hereafter be erected (whether or not by Landlord) shall
entitle Tenant to any reduction of Rent, result in any liability of Landlord to
Tenant, or in any other way affect this Lease or Tenant's obligations hereunder.

                                       37
<PAGE>

     33.18  Public Transportation Information. Tenant shall establish and
            ---------------------------------
maintain during the Term hereof a program to encourage maximum use of public
transportation by personnel of Tenant employed on the Leased Premises, including
without limitation the distribution to such employees of written materials
explaining the convenience and availability of public transportation facilities
adjacent or proximate to the Complex, staggering working hours of employees, and
encouraging use of such facilities, all at Tenant's sole reasonable cost and
expense. Tenant shall comply with all requirements of any local transportation
management ordinance.

     33.19  Joint and Several Liability. Should Tenant consist of more than one
            ---------------------------
person or entity, they shall be jointly and severally liable on this Lease.

     33.20  Survival of Obligations. All obligations of Tenant which may accrue
            -----------------------
or arise during the term of this Lease or as a result of any act or omission of
Tenant during said term shall, to the extent they have not been fully performed,
satisfied or discharged, survive the expiration or termination of this Lease.

     33.21  Real Estate Brokers. Landlord and Tenant each represents and
            -------------------
warrants to the other party that it has not authorized or employed, or acted by
implication to authorize or employ, any real estate broker or salesman to act
for it in connection with this Lease, except for the Broker identified in
Article 1. Landlord and Tenant shall each indemnify, defend and hold the other
party harmless from and against any and all claims by any real estate broker or
salesman whom the indemnifying party authorized or employed, or acted by
implication to authorize or employ, to act for the indemnifying party in
connection with this Lease.

     33.22  Waiver of California Code Sections. In this Lease, numerous
            ----------------------------------
provisions have been negotiated by the parties, some of which provisions are
covered by statute. Whenever a provision of this Lease and a provision of any
statute or other law cover the same matter, the provisions of this Lease shall
control. Therefore, Tenant waives (for itself and all persons claiming under
Tenant) the provisions of Civil Code Sections 1932(2) and 1933(4) with respect
to the destruction of the Leased Premises; Civil Code Sections 1941 and 1942
with respect to Landlord's repair duties and Tenant's right to repair; Code of
Civil Procedure Section 1265.130, allowing either party to petition the Superior
Court to terminate this Lease in the event of a partial taking of the Leased
Premises by condemnation as herein defined; and any right of redemption or
reinstatement of Tenant under any present or future case law or statutory
provision (including Code of Civil Procedure Sections 473 and 1179 and Civil
Code Section 3275) in the event Tenant is dispossessed from the Leased Premises
for any reason. This waiver applies to future statutes enacted in addition to or
in substitution for the statutes specified herein.

     33.23  Quiet Enjoyment. So long as Tenant pays all of the Minimum Monthly
            ---------------
Rent, all additional rent and other sums and charges under the Lease and
otherwise performs all of its obligations in the Lease, Tenant shall have the
right to possession and quiet enjoyment of the Leased Premises free from any
unreasonable disturbance or interference, subject to the terms and provisions of
the Lease. Landlord represents and warrants that it has the full right and power
to execute and perform this Lease and to grant the estate demised herein.

     33.24  Counterparts. This Lease may be executed in One or more
            ------------
counterparts, each of which shall be deemed an original, but all of which when
taken together shall constitute one agreement.

                                       38
<PAGE>

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

LANDLORD:                                   TENANT:

SJ PLAZA, LLC,                              BLAZE SOFTWARE, INC.
a Delaware limited liability company        a California corporation

By:  Divco West Group, LLC                  By:  /s/ Gary Shroyer
     A Delaware limited liability company      ---------------------------------
     Its Agent                              Name:   Gary Shroyer
                                                 -------------------------------
                                            Its:    VP CFO
                                                --------------------------------


By:  /s/ Scott L. Smithers                  By:  /s/ Gary Shroyer
   -------------------------------             ---------------------------------
Name:    Scott L. Smithers                  Name:   Gary Shroyer
     -----------------------------               -------------------------------
Its:        President                       Its:    Corporate Secretary
    ------------------------------              --------------------------------

                                       39
<PAGE>

                                   EXHIBIT C
                                   ---------

                   WORK LETTER FOR CONSTRUCTION OBLIGATIONS
                   ----------------------------------------

     This Exhibit C forms a part of that certain office Lease (the "Lease") by
and between SJ PLAZA, LLC, a Delaware limited liability company, as Landlord,
and BLAZE SOFTWARE, INC., as Tenant, to which this Exhibit is attached. If there
is any conflict between this Exhibit and the Lease, this Exhibit shall govern.

     1.   Defined Terms. All defined terms referred to in this Exhibit shall
          -------------
have the same meaning as defined in the Lease to which this Exhibit is a part,
except where expressly defined to the contrary.

     2.   Additional Definitions. Each of the following terms shall have the
          ----------------------
following meaning:

          "Construction Plans" -The complete plans and specifications for the
           ------------------
construction of the Tenant Improvements consisting of all architectural,
engineering, mechanical and electrical drawings and specifications which are
required to obtain all building permits, licenses and certificates from the
applicable governmental authority(ies) for the construction of the Tenant
Improvements. The Construction Plans shall be prepared by duly licensed and/or
registered architectural and/or engineering professionals selected by Landlord
in its sole and absolute discretion, and in all respects shall be in substantial
compliance with all applicable laws, rules, regulations, building codes for the
city and county where the Building is located.

          "Force Majeure Delays" - Any delay, other than a Tenant Delay, by
           --------------------
Landlord in completing the Tenant Improvements by the Estimated Commencement
Date set forth in the Lease by reason of (i) any strike, lockout or other labor
trouble or industrial disturbance (whether or not on the part of the employees
of either party hereto), (ii) governmental preemption of priorities or other
controls in connection with a national or other public emergency, civil
disturbance, riot, war, sabotage, blockade, embargo, inability to secure
customary materials, supplies or labor through ordinary sources by reason of
regulation or order of any government or regulatory body, or (iii) shortages of
fuel, materials, supplies or labor, (iv) lightning, earthquake, fire, storm,
tornado, flood, washout explosion, inclement weather or any other similar
industry-wide or Building-wide cause beyond the reasonable control of Landlord,
or (v) any other cause, whether similar or dissimilar to the above, beyond
Landlord's reasonable control. The time for performance of any obligation of
Landlord to construct Landlord's Work under this Work Letter or the Lease shall
be extended at Landlord's election by the period of any delay caused by any of
the foregoing events.

          "Space Plan" - That certain Space Plan attached hereto as Exhibit C-l,
           ----------
which reflects the layout of the Tenant Improvements to be constructed by
Landlord. Landlord and Tenant hereby approve of the Space Plan.

          "Substantial Completion," "Substantially Complete," "Substantially
           -----------------------------------------------------------------
Completed"- The terms Substantial Completion, Substantially Completed and
---------
Substantially Complete shall mean when the following have occurred or would have
occurred but for Tenant Delays:

          (a)  Landlord has delivered to Tenant a written notice stating that
the Tenant Improvements have been Substantially Completed substantially in
accordance with the Construction

                                       1
<PAGE>

Plans, except "punch list" items which may be completed without materially
impairing Tenant's use of the Leased Premises or a material portion thereof; and

               (b)  Landlord has obtained from the appropriate governmental
authority a temporary, conditional or final certificate of occupancy or signed
building permit (or equivalent), if one is required, for the Tenant Improvements
permitting occupancy of the Leased Premises by Tenant.

          "Tenant Delay"- Any delay incurred by Landlord in completing the
           ------------
Tenant Improvements due to (i) a delay by Tenant, or by any person employed or
engaged by Tenant, in approving or delivering to Landlord any plans, schedules
or information, including, without limitation, the Construction Plans beyond the
applicable time period set forth in this Exhibit, if any; (ii) a delay in the
performance of work in the Premises by Tenant or any person employed by Tenant;
(iii) any changes requested by Tenant in or to previously approved work or in
the Space Plan or Construction Plans; (iv) requests for materials and finishes
which are not readily available, and/or delays in delivery of any materials
specified by Tenant through change orders; (v) the failure of Tenant to pay as
and when due under this Exhibits all costs and expenses to construct the Tenant
Improvements to the extent Tenant is required to pay for such costs in this
Exhibit; (vi) interference with the construction of the Tenant Improvements;
(vii) any delay attributable to the failure of Tenant to pay, when due, any
amounts required to be paid by Tenant pursuant to this Exhibit or otherwise
provided in the Lease. Landlord shall provide written notice to Tenant of any
event constituting a Tenant Delay and the estimated length of the delay promptly
following the date that Landlord has actual knowledge of such event constituting
a Tenant Delay. If Tenant disputes that the event constitutes a Tenant Delay or
the length of the Tenant Delay and the dispute is not resolved by the parties
within 20 days, the matter shall be resolved by Landlord's architect whose
decision on this subject shall be binding on the parties.

          "Tenant Improvements" - The improvements to be installed by Landlord
           -------------------
in the portion of the Leased Premises substantially in accordance with the
Construction Plans and the type and quality of the Tenant Improvements shall be
typical of standard interior improvements constructed by Landlord which are of
the nature and quality required by specifications developed for the building
containing the premises by Landlord's architect.

     2.   Construction of the Tenant Improvements.
          ---------------------------------------

          2.1  Construction Plans. Concurrent with its execution of the Lease,
               ------------------
Tenant shall submit to Landlord or its architect all additional information,
including occupancy requirements for the Tenant Improvements in the Premises
("Information"), necessary to enable Landlord's architect to prepare
Construction Plans for the Tenant Improvements. Landlord shall be entitled to
rely upon all plans, drawings and information supplied by or for Tenant in
preparing the preliminary plans. As soon as is commercially reasonable after
receipt of the Information, Landlord shall cause to be prepared the Construction
Plans for the Tenant Improvements that are consistent with and are logical
evolutions of the Space Plan and the building standards and a copy of such
Construction Plans shall be delivered to Tenant for its review and approval
which shall not be unreasonably withheld. Tenant shall notify Landlord in
writing within five (5) business days after receipt of Construction Plans or any
preliminary plans that (i) Tenant approves of such plans; or (ii) Tenant
disapproves the plans because they vary in design from the Space Plan approved
by Landlord and Tenant in the particular instances specified by Tenant in such
notice (including, without limitation, the specific changes requested by
Tenant), but such disapproval shall constitute a Tenant Delay unless the plans
materially deviate from the Space Plan or changes in such Space Plan that have
been approved in writing by Landlord. The failure of Tenant to provide such
written notice within said five (5) business day period shall be deemed as
approval by Tenant of such plans.

                                       2
<PAGE>

          2.2  Construction. Landlord shall construct the Tenant Improvements
               ------------
substantially in accordance with the Construction Plans. The construction
contract for constructing the Tenant Improvements and the contractor(s) to
perform the work shall be approved and/or selected, as the case may be, by
Landlord at its sole and absolute discretion without the consent of Tenant. The
parties anticipate that the Tenant Improvements will be Substantially Completed
by the estimated Commencement Date, subject to Tenant Delays and Force Majeure
Delays.

          2.3  Tenant's Responsibility. Tenant shall be solely responsible for
               -----------------------
the suitability for the Tenant's needs and business of the design and function
of the Tenant Improvements. Tenant shall also be responsible for procuring or
installing in the Premises any trade fixtures, equipment, furniture,
furnishings, telephone equipment or other personal property ("Personal
Property") to be used in the Premises by Tenant, and the cost of such Personal
Property shall be paid by Tenant. Tenant shall conform to the Building's wiring
standards in installing any telephone equipment and shall be subject to any and
all rules of the site during construction.

     3.   Payment of Construction Costs. Landlord shall pay for the costs to
          -----------------------------
construct the Tenant Improvements based on the Space Plan in existence as of the
date hereof. Any additional costs due to changes in the Tenant Improvements
reflected in the Space Plan or in the Construction Plans requested by Tenant or
as a result of any Tenant Delay shall be paid by Tenant as provided in section 4
below.

     4.   Changes in Work. Tenant shall not be permitted to make any change in
          ---------------
the Tenant Improvements without the prior written approval of Landlord, which
may be exercised, and made subject to such conditions as Landlord may require,
in its reasonable discretion. Any change approved by Landlord that in Landlord's
judgment results in a delay in constructing the Tenant Improvements shall be
deemed a Tenant Delay, and shall extend the time period by which Landlord must
Substantially Complete the Tenant Improvements, but shall not extend or postpone
the date for payment of rent or for commencement of the term under this Lease.
Tenant shall be responsible for the additional costs actually incurred by
Landlord for such change after considering any changes where there may have been
a savings, including the cost to revise the Construction Plans, obtain any
additional permits and construct any additional improvements required as a
result thereof, and the cost for materials and labor, and all other additional
costs incurred by Landlord from resulting delays in completing the Tenant
Improvements. Tenant shall make such payment to Landlord within ten (10) days
after Tenant's receipt of notice from Landlord. If Landlord does not receive
such payment within said ten (10) day period, Landlord shall have the right, in
addition to any other rights or remedies available under the Lease, at law or in
equity, to (i) discontinue all or any portion of the work until it receives said
payment; (ii) proceed with the other work not affected by such change until such
payment is received; (iii) proceed with the work contemplated with such change;
or (iv) proceed with the work without making such change; in which case the
commencement or completion of such work shall not be deemed a waiver of Tenant's
obligation to pay for same or any additional costs or expenses incurred as a
result thereof. Any delay caused as a result of such a change or request for a
change shall constitute a Tenant Delay.

                                       3
<PAGE>

                                   EXHIBIT D
                                   ---------

                ACKNOWLEDGEMENT OF SUBSTANTIAL COMPLETION DATE

     This Acknowledgement of Substantial Completion Date is dated as of
,1999 between SJ PLAZA, LLC, a Delaware limited liability company ("Landlord"),
and BLAZE. SOFTWARE, INC. ("Tenant"), who entered into a lease dated for
reference purposes as of ________________ covering certain premises located in
Suites 800 and 900 of the building at 150 Almaden Blvd., San Jose, California.
All capitalized terms, if not defined herein, shall be defined as they are
defined in the Lease.

     1.   The parties agree that the date of       , is the date the Tenant
Improvements were Substantially Completed ( as defined in Exhibit C to the
Lease).

     2.   Tenant hereby confirms the following:

          (a)  That it has accepted possession of the Premises pursuant to the
terms of the Lease; and

          (b)  That the Tenant Improvements required to be furnished according
to the Lease by Landlord in the Premises have been Substantially Completed.

     3.   This agreement, each and all of the provisions hereof, shall inure to
the benefit, or bind, as the case may require, the parties hereto, and their
respective heirs, successors, and assigns subject to the restrictions upon
assignment and subletting contained in the Lease.

LANDLORD:                                        TENANT:

SJ PLAZA, LLC,                                   BLAZE SOFTWARE, INC.,
a Delaware limited liability company             a California corporation

By:  Divco West Group, LLC                       By:____________________________
     A Delaware limited liability company        Name:__________________________
     Its Agent                                   Its:___________________________

     By:__________________________
     Name:________________________
     Its:_________________________
<PAGE>

                                   EXHIBIT E
                                   ---------

                             RULES AND REGULATIONS
                             ---------------------

     All capitalized terms referred to in this Exhibit shall have the same
meaning provided in the Office Lease to which this Exhibit is attached, except
where expressly provided to the contrary in this Exhibit E.

     1.  No sidewalks, entrance, passages, courts, elevators, vestibules,
stairways, corridors or halls shall be obstructed or encumbered by Tenant or
used for any purpose other than ingress and egress to and from the Leased
Premises and if the Leased Premises are situated on the ground floor of the
Building, Tenant shall further, at Tenant's own expense, keep the sidewalks and
curb directly in front of the Leased Premises clean and free from rubbish.

     2.  No awning or other projection shall be attached to the outside walls or
windows of the Building or Complex without the prior written consent of Landlord
in its sole and absolute discretion. No curtains, blinds, shades, drapes or
screens shall be attached to or hung in, or used in connection with any window
or door of the Leased Premises, without the prior written consent of Landlord in
its sole and absolute discretion. Such awnings, curtains, blinds, shades,
drapes, screens and other fixtures must be of a quality, type, design, color,
material and general appearance approved by Landlord, and shall be attached in
the manner approved by Landlord in its sole and absolute discretion. All
lighting fixtures hung in offices or spaces along the perimeter of the Leased
Premises must be of a quality, type, design, bulb color, size and general
appearance approved by Landlord.

     3.  No sign, advertisement, notice, lettering, decoration or other thing
shall be exhibited, inscribed, painted or affixed by Tenant on any part of the
outside or inside of the Leased Premises or of the Building, without the prior
written consent of Landlord in its sole and absolute discretion. In the event of
the violation of the foregoing by Tenant, Landlord may remove same without any
liability, and may charge the expense incurred by such removal to Tenant.

     4.  The sashes, sash doors, skylights, windows and doors that reflect or
admit light or air into the halls, passageways or other public places in the
Building or Complex shall not be covered or obstructed by Tenant, nor shall any
bottles, parcels or other articles be placed on the window sills or in the
public portions of the Building or Complex.

     5.  No show cases or other articles shall be put in front of or affixed to
any part of the exterior of the Building or Complex, nor placed in public
portions thereof without the prior written consent of Landlord.

     6.  The restrooms, toilets, wash bowls, and other apparatus shall not be
used for any purpose other than that for which they were constructed, and no
sweepings, rubbish, rages or other foreign substance of any kind shall be thrown
into them. The expense of any breakage, stoppage, or damage resulting from
violation of this rule shall be borne by the tenant who caused, or whose agents,
servants, employees, contractors, visitors or licensees caused, the breakage,
stoppage, or damage.

     7.  Tenant shall not mark, paint or in any way deface any part of the
Leased Premises or the Building or Complex, but shall have the right to put
normal and customary decorations on the walls of the type typically found in
office buildings. No boring, cutting or stringing of wires shall be permitted,
except with the prior written consent of Landlord, and as Landlord may direct,
in its sole and absolute discretion.

                                       1
<PAGE>

     8.  No animal or bird or bicycle or vehicle of any kind shall be brought
into or kept in or about the Leased Premises, Building or Complex, except
seeing-eye dogs or other seeing-eye animals or other animals or equipment
required by any disabled employee or invitee of Tenant.

     9.  Prior to leaving the Leased Premises for the day, Tenant shall draw or
lower window coverings and extinguish all lights. Tenant shall assume all
responsibility, including keeping doors locked and other means of entry to the
Leased Premises closed, for protecting the Leased Premises from theft, robbery,
and pilferage.

     10.  Tenant shall not make, or permit to be made, any unseemly or
disturbing noises or disturb or interfere with any occupant of the Building or
Complex, or neighboring buildings or premises, or those having business with
them. Tenant shall not harass or annoy any occupant of the Building or Complex,
including, without limitation, any act or conduct that may violate, breach or
infringe upon any federal, state or local laws or civil rights, including those
pertaining to the protection of the civil rights of any person based on sex,
race, religion, sexual preference, age or other consideration. Tenant shall not
throw anything out of the doors, windows or skylights or down the passageways.

     11.  Neither Tenant nor any of Tenant's agents, servants, employees,
contractors, visitors or licensees shall at any time bring or keep upon the
Leased Premises, Building or Complex any flammable, combustible or explosive
fluid, chemical or substance.

     12.  No additional locks, bolts or mail slots of any kind shall be placed
upon any of the doors or windows by Tenant, nor shall any change be made in
existing locks or the mechanism thereof. Tenant must, upon the termination of
the tenancy, restore to Landlord all keys of stores, offices and toilet rooms,
either furnished to, or otherwise procured by Tenant, and in the event of the
loss of any keys so furnished, Tenant shall pay to Landlord the cost thereof.

     13.  No furniture, freight, or large equipment of any kind may be brought
into or out of the Building without prior notice to Landlord. All moving
activity into or out of the Building must be scheduled with Landlord and done
only at the time and in the manner designated by Landlord. No deliveries of
furniture, freight or large equipment (other than messenger services) shall be
allowed between the hours of 7:00 a.m. and 9:00 a.m., 12:00 p.m. and 1:00 p.m.,
and 4:00 p.m. and 6:00 p.m., Monday through Friday. Landlord may at any time
restrict the elevators and areas of the Building into which messengers may enter
and may require that deliveries be left at the lobby security desk for pickup by
Tenant. Landlord may prescribe the weight, size, and position of all safes and
other heavy property brought into the Building and the times and manner of
moving those items within and out of the Building. Tenant shall not overload the
floor of the Leased Premises. If considered necessary by Landlord, safes and
other heavy objects must stand on supports that are adequate to distribute the
weight properly. Landlord shall not be responsible for loss of or damage to any
safe or property. Any damage to any part of the Building or to its contents,
occupants, or visitors caused by moving or maintaining any safe or other
property referred to in this clause shall be the sole responsibility and expense
of Tenant. Landlord reserves the right to inspect all safes, freight or other
bulky articles to be brought into the Building and to exclude from the Building
all safes, freight or other bulky articles which violate any of these Rules and
Regulations or the Lease of which these Rules and Regulations are a part. No
packages, supplies, equipment, or merchandise may be received in the Building or
carried up or down in the elevators, except between those hours and in that
specific elevator that Landlord shall designate.

     14.  Landlord shall have the right to prohibit any advertising or business
conducted by Tenant referring to the Building which, in Landlord's good faith
opinion, tends to impair the reputation of the

                                       2
<PAGE>

Building or its desirability as a first class building for offices and/or
commercial services and upon notice from Landlord, Tenant shall refrain from or
discontinue such advertising.

     15.  Landlord reserves the right to exclude from the Building between the
hours of 6:00 p.m. and 8:00 a.m. Monday through Friday, after 1:00 p.m. on
Saturdays and at all hours Sundays and legal holidays, all persons who do not
present a pass to the Building issued by Landlord. Such hours are subject to
change in Landlord's sole and absolute discretion upon written Landlord notice
from Landlord. Landlord may furnish passes to Tenant so that Tenant may validate
and issue same. Tenant shall safeguard said passes and shall be responsible for
all acts of persons in or about the Building who possess a pass issued to
Tenant. Landlord reserves the right to exclude or expel from the Building and
Complex any person who, in Landlord's judgment, is under the influence of
alcohol or drugs or commits any act in violation of any of these Rules and
Regulations.

     16.  Any person, including Tenant and Tenant's employees and agents, who
enters or leaves the Building at any time when it is locked or at any time
considered to be after the Building's normal business hours, may be required to
sign the Building register. Access to the Building may be refused unless the
person seeking access has proper identification or has previously arranged a
pass for access to the Building. Landlord and its agents shall not be liable for
damages for any error concerning the admission to, or exclusion from, the
Building of any person. Landlord reserves the right, in the event of invasion,
mob, riot, public excitement, or other commotion, to prevent access to the
Building or Complex during the continuance of that event by any means it
considers appropriate for the safety and protection of life and property.

     17.  Tenant's contractors shall, while in the Leased Premises, Building or
elsewhere in the Complex, be subject to and under the control and direction of
the Building Manager (but not as agent or servant of said Building Manager or of
Landlord).

     18.  If the Leased Premises is or becomes infested with vermin as a result
of the use or any misuse or neglect of the Leased Premises by Tenant, its
agents, servants, employees, contractors, visitors or licensees, Tenant shall
forthwith at Tenant's expense cause the same to be exterminated from time to
time to the satisfaction of Landlord and shall employ such licensed
exterminators as shall be approved in writing in advance by Landlord.

     19.  The requirements of Tenant will be attended to only upon application
at the office of the Building. Building personnel shall not perform any work or
do anything outside of their regular duties unless under special instructions
from the office of the Landlord.

     20.  Tenant and Tenant's employees, agents, contractors and invitees shall
not loiter in or on the entrances, corridors, sidewalks, lobbies, halls,
stairways, elevators, or common areas for the purpose of smoking tobacco
products Or for any other purpose. Tenant and Tenant's employees and agents
shall not obstruct those areas but use them only as a means of ingress to and
egress from the Leased Premises, Building or Complex. Canvassing, soliciting and
peddling in the Building or Common Areas of the Complex are prohibited and
Tenant shall cooperate to prevent the same.

     21.  No air conditioning unit or system or other apparatus shall be
installed or used by Tenant without the written consent of Landlord in its sole
and absolute discretion. Tenant shall not waste electricity, water, or air-
conditioning and shall cooperate fully with Landlord to ensure the most
effective operation of the Building's heating and air-conditioning system.

                                       3
<PAGE>

     22.  There shall not be used in any premises, or in the public halls, plaza
areas, lobbies, or elsewhere in the Building or Complex, either by Tenant or by
jobbers or others, in the delivery or receipt of merchandise, any hand trucks or
dollies, except those equipped with rubber tires and sideguards.

     23.  Tenant, Tenant's agents, servants, employees, contractors, licensees,
or visitors shall not park any vehicles in any driveways, service entrances, or
areas posted "No Parking" and shall comply with any other parking restrictions
imposed by Landlord from time to time.

     24.  Tenant shall install and maintain, at Tenant's sole cost and expense,
an adequate visibly marked (at all times properly operational) fire extinguisher
next to any duplicating or photocopying machine or similar heat producing
equipment to the extent required by applicable law, which may or may not contain
combustible material, in the Leased Premises, Building or Complex.

     25.  Tenant shall keep its window coverings closed during any period of the
day when the sun is shining directly on the windows of the Leased Premises.

     26.  Tenant shall not use the name of the Building for any purpose other
than as the address of the business to be conducted by Tenant in the Leased
Premises, nor shall Tenant use any picture of the Building in its advertising,
stationery or in any other manner without the prior written permission of
Landlord. Landlord expressly reserves the right at any time to change said name
without in any manner being liable to Tenant therefor.

     27.  Tenant shall not prepare any food nor do any cooking, operate or
conduct any restaurant, luncheonette or cafeteria for the sale or service of
food or beverages to others, except that food and beverage preparation by
Tenant's employees using microwave ovens, equipment and/or coffee makers in
Tenant's kitchen in the Lease Premises shall be permitted; provided, however, no
odors of cooking or other processes may emanate from the Leased Premises. Tenant
shall not install or permit the installation or use of any vending machine or
permit the delivery of any food or beverage to the Leased Premises except for
normal and customary vending machines typically found in leased premises in
office buildings and for use or consumption by Tenant and its partners,
officers, employees, agents and invitees or as approved in advance in writing by
Landlord.

     28.  Business machines and mechanical equipment shall be placed and
maintained by Tenant at Tenant's expense in settings sufficient in Landlord's
judgment to absorb and prevent vibration, noise and annoyance. Tenant shall not
install any machine or equipment which causes noise, heat, cold or vibration to
be transmitted to the structure of the Building in which the Leased Premises are
located without Landlord's prior written consent in its sole and absolute
discretion. Tenant shall not place a load upon any floor of the Leased Premises
exceeding the floor load per square foot which such floor was designed to carry
and which is allowed by law.

     29.  Smoking is prohibited in the Building, including, without limitation,
the main lobby, all hallways, all elevators, all elevator lobbies and all
restrooms.

     30.  Tenant shall store all trash and garbage within the interior of the
Leased Premises. Tenant shall not place or have placed in the trash boxes or
receptacles any material that may not or cannot be disposed of in the ordinary
and customary manner of removing and disposing of trash in the vicinity of the
Building. In disposing of trash and garbage, Tenant shall comply fully with any
law or ordinance governing that disposal. All trash, garbage, and refuse
disposal shall be made only through entry-ways and elevators provided for that
purpose and shall be made only at times designated by Landlord.

                                       4
<PAGE>

     31.  Tenant shall comply with requests by Landlord that Tenant inform
Tenant's employees of items of importance to Landlord.

     32.  Tenant may not introduce telephone, cable or other communication or
telecommunication wires or other wires into the Leased Premises without first
obtaining Landlord's approval of the method and location of such introduction.
No boring or cutting for telephone wires or other wires shall be allowed without
Landlord's consent. The location of telephones, call boxes, and other office
equipment affixed to the Premises shall be subject to Landlord's prior approval

     33.  Landlord reserves the right at any time to change or rescind any one
or more of these Rules and Regulations or to make any additional reasonable
Rules and Regulations that, in Landlord's sole and absolute discretion, may be
necessary for:

               (a) The management, safety, care, and cleanliness of the Leased
Premises, Building or Complex;

               (b) The preservation of good order; or

               (c) The convenience of other occupants and tenants in the
Building or Complex.

          Landlord may waive any one or more of these Rules and Regulations for
the benefit of any particular tenants. No waiver by Landlord shall be construed
as a waiver of those Rules and Regulations in favor of any other tenant, and no
waiver shall prevent Landlord from enforcing those Rules or Regulations against
any other tenant of the Building or Complex.

                                       5
<PAGE>

                                   EXHIBIT F

                          DECLARATION OF RESTRICTIONS

That certain Ninth Amended Park Center Redevelopment Plan adopted June 25, 1996,
City Council Ordinance No. 25112.
<PAGE>

                                 ADDENDUM NO. 1

     This ADDENDUM NO. 1 (this "Addendum") is made in connection with and is a
part of that certain Lease, dated as of November 12, 1999 by and between SJ
Plaza, LLC, a Delaware limited liability company, as Landlord, and Blaze
Software, Inc., as Tenant, (the "Lease").

     1.  Definitions and Conflict. All capitalized terms referred to in this
         ------------------------
Addendum shall have the same meaning as provided in the Lease, except as
expressly provided to the contrary in this Addendum. In case of any conflict
between any term or provision of the Lease and any exhibits attached thereto and
this Addendum, this Addendum shall control.

     2.  Parking. Tenant shall have the right to the following parking
         -------
privileges in the areas designated in section 2.1 below. The parking privileges
are not applicable in the other levels of any parking garage or any other
parking areas at the Complex. To exercise its rights to use any or all of such
spaces, Tenant agrees that it must enter into a parking agreement, in the form
required by the applicable tenant or operator of the Parking Garage (hereinafter
defined), and comply with the requirements of such tenant or operator of said
Parking Garage.

          2.1  Number of Spaces. Tenant shall have the right to 50 monthly
               ----------------
parking spaces on levels P2 and P3 of the main parking garage at Park Center
Plaza and to 30 monthly parking spaces at the 5 story parking tower at 185 Park
Avenue (each such parking facility shall be referred to herein as the "Parking
Garage") for the Term of the Lease at the then prevailing market rate as set
forth by the tenant and/or operator of each such Parking Garage.

          2.2  Notice of Exercise. Tenant hereby elects to have all of said
               ------------------
parking spaces. If Tenant does not enter into the parking agreement with the
tenant or operator of the Parking Garage or if Tenant elects on not less than
thirty (30) days prior written notice to Landlord and the tenant and/or operator
of the Parking Garage to discontinue using all or any specified number of
parking spaces Tenant previously elected to use, then Tenant shall not have any
right to use the parking spaces for which it did not enter into a parking
agreement or for which it rejected or subsequently discontinued, which spaces
may be available to Landlord, and any parking rights for Tenant hereunder as to
such rejected and subsequently discontinued spaces shall be null and void. Such
rejected or discontinued spaces may be made available to Tenant in the future
only to the extent such spaces become available, but there is not guaranty or
assurance that such spaces will become available again in the future.

          2.3  General Procedures. The parking spaces will not be separately
               ------------------
identified and Landlord shall have no obligation to monitor the use of the
Parking Garage. The parking operator of the Parking Garage will be responsible
for monitoring the use of the Parking Garage. If Tenant discovers that the
parking spaces are not available due to over-parking at the applicable Parking
Garage, Landlord agrees to require the parking operator to implement a program
or procedure to make the parking spaces that Tenant is entitled to under this
Addendum available to Tenant. Landlord shall not be responsible for any loss or
damage to any vehicle or other property at the Parking Garage or for any injury
to any person. Said parking spaces shall be used only for parking of automobiles
no larger than full size passenger automobiles, SUV vehicles, pick-up trucks and
motorcycles. Tenant shall comply with all rules and regulations of the tenant or
operator of the Parking garage where the parking spaces are located. A failure
by Tenant or any of its employees, suppliers, shippers, customers or invitees to
comply with the foregoing provisions shall subject Tenant to the loss of use of
such parking spaces, in which case the Lease shall continue without any
abatement in rent or charge to Landlord.

                                       1
<PAGE>

          2.4  Force Majeure. Landlord's agreement to provide or arrange for the
               -------------
parking spaces as provided herein shall be subject to casualties, Acts of God
and other events beyond the control of Landlord.

          2.5  Condition. Tenant's rights to any parking spaces under this
               ---------
section are expressly conditioned upon (a) Tenant not being in default (after
notice and the expiration of the applicable cure period) of any term or
provision of this Lease, and (b) Tenant and/or its assignee or sublessee using
the parking spaces only while such party is the Tenant under the Lease (or a
subtenant of Tenant) and for use only in connection with its use and occupancy
of the Leased Premises.

          2.6  Limitation. Landlord shall not be responsible for any loss or
               ----------
damage to property or injury to persons in or about the Parking Garage; it being
acknowledged by the parties that Tenant assumes all risk of loss or damage at or
about any parking garage.

     3.  Option to Extend and Rent During the Extended Period: Tenant shall have
         ----------------------------------------------------
one option to extend the term of the Lease for a period of five (5) years (the
period shall be referred to as the "Extension Period") by giving written notice
of exercise of such option ("Extension Option Notice") at least two hundred
seventy (270) days, but not more than three hundred sixty-five (365) days, prior
to the expiration of the Term. The Extension Period shall commence, if at all,
immediately following the expiration of the initial Term of the Lease. If Tenant
is in default (after notice and the expiration of he applicable cure period)
under any term or provision of the Lease on the date of giving an Extension
Option Notice, or if Tenant is in default (after notice and the expiration of
the applicable cure period) under any term or provision of the Lease on the date
of the applicable Extension Period is to commence, the Extension Period at the
option of Landlord shall not commence and the Lease shall expire at the end of
initial term. The Extension Period shall be upon all of the terms and provisions
of the Lease, except that the Minimum Monthly Rent during such Extension Period
shall be one hundred percent (100%) of then Fair Market Rent.

          3.1  Fair Market Rent. The term "Fair Market Rent" for purposes of
               ----------------
determining Minimum Monthly Rent during the Extension Period shall mean the
greater of (i) the Minimum Monthly Rent payable during the last month prior to
the commencement of the Extension Period, or (ii) the minimum monthly rent
generally applicable to full service office leases at first class office
buildings of comparable size, age, quality of the Leased Premises in the
downtown San Jose, California location projected as of the first day of the
Extension Period by giving due consideration for the quality of the Building and
improvements therein, for a term comparable to the Extension Period at the time
the commencement of the Extension Period is scheduled to commence, without any
deduction for amortization or cost of tenant improvements, allowances, capital
improvements or commissions whether or not incurred by Landlord, and otherwise
subject to the terms and conditions of this Lease that will be applicable during
the Extension Period.

          3.2  Procedure to Determine Fair Market Rent. Landlord shall notify
               ---------------------------------------
Tenant in writing of Landlord's determination of the Fair Market Rent
("Landlord's FMR") within fifteen (15) days after receipt of the Extension
Option Notice. Within fifteen (15) days after receipt of such written notice of
Landlord's FMR, Tenant shall have the right either to: (i) accept Landlord's
FMR, or (ii) elect to have the Fair Market Rent determined in accordance with
the appraisal procedure set forth below. The failure of Tenant to provide
written notice of its election under the preceding sentence shall be deemed an
acceptance of Landlord's FMR. The election (or deemed election ) by Tenant under
this section shall be non-revocable and binding on the parties.

                                       2
<PAGE>

          3.3  Appraisers. If Tenant has elected to have the Fair Market Rent
               ----------
determined by an appraisal, then within ten (10) days after receipt of Tenant's
written notice of such an election, each party, by giving written notice to the
other party, shall appoint an appraiser to render a written opinion of the Fair
Market Rent for the Extension Period. Each appraiser must be a member of the
Appraisal Institute of America (MAI) for at least five years and with at least
five years experience in the appraisal of rental rates of leases in office
buildings in the area in which the Building is located and otherwise
unaffiliated with either Landlord or Tenant. The two appraisers shall render
their written opinion of the Fair Market Rent for the Extension Period to
Landlord and Tenant within thirty (30) days after the appointment of the second
appraiser. If the Fair Market Rent of each appraiser is within five percent (5
%) of each other, then the average of the two appraisals of Fair Market Rent
shall be the Minimum Monthly Rent for the Extension Period. If one party does
not appoint its appraiser as provided above, then the one appointed shall
determine the Fair Market Rent. The Fair Market Rent so determined under this
section shall be binding on Landlord and Tenant.

          3.4  Third Appraiser. If the Fair Market Rent determined by the
               ---------------
appraisers is more than five percent (5%) apart, then the two appraisers shall
pick a third appraiser within ten (10) days after the two appraisers have
rendered their opinions of Fair Market Rent as provided above. If the two
appraisers are unable to agree on the third appraiser within said ten (10) day
period, Landlord and Tenant shall mutually agree on the third appraiser within
ten (10) days thereafter. If the parties do not agree on a third qualified
appraiser within ten (10) days, then at the request of either Landlord or
Tenant, such third appraiser shall be promptly appointed by the then Presiding
Judge of the Superior Court of the State of California for the County of Santa
Clara. The third appraiser shall be a person who has not previously acted in any
capacity for either party and must meet the qualifications stated above.

          3.5  Impartial Appraisal. Within thirty (30) days after its
               -------------------
appointment, the third appraiser shall render its written opinion of the Fair
Market Rent for the applicable Extension Period ("Third Opinion"). If the Fair
Market Rent set forth in the Third Opinion is equidistant from the Fair Market
Rent determination of Landlord's and Tenant's appraiser, then the Fair Market
Rent contained in the Third Opinion shall be the Minimum Monthly Rent during the
Extension Period. If the Fair Market Rent of the Third Opinion is not
equidistant from the Fair Market Rent made by Landlord's and Tenant's appraiser,
then the two closest fair market determinations made by Landlord's appraiser,
Tenant's appraiser and the Third Opinion shall be average and such average shall
be the Minimum Monthly Rent during the applicable Extension Period. The Fair
Market Rent determined in accordance with the foregoing procedure shall be
binding on the parties.

          3.6  Appraisal Costs. Each party shall bear the cost of its own
               ---------------
appraiser and one-half (1/2) the cost of the third appraiser, unless the Fair
Market Rent of the Third Opinion is within three percent (3%) Landlord's FMR, in
which case Tenant shall bear the entire cost of the third appraiser.

          3.7  Acknowledgment of Rent. After the Fair Market Rent for the
               ----------------------
Extension Period has been established in accordance with the foregoing
procedure, Landlord and Tenant shall promptly execute an amendment to the Lease
to reflect the minimum monthly rent for the Extension Period.

          3.8  Personal Option. The foregoing option to extend is personal to
               ---------------
the original Tenant signing the Lease (and its Affiliated Transferee as defined
in Section 21.5 of the Lease), but may not be assigned or transferred to or
exercised by any other assignee, sublessee or transferee under a Transfer.

     4.  Expansion Right. If Tenant is not in default of any term or provision
         ---------------
of the Lease and has not assigned the Lease or sublet any space covered thereby
or agreed to do so in the future, Tenant

                                       3
<PAGE>

shall have the one time right only during the initial Term (not any extended
term) of the Lease to expand into space in the sixth (6th) and seventh (7th)
floor(s) of the Building (the "Expansion Space") solely in accordance with the
terms of this section 4 and its subsections; provided, however, that such
expansion right shall not be applicable to (i) a renewal, assignment or sublease
of any lease or any new lease with any existing tenant for space in any portion
of the Expansion Space, (ii) any expansion options or similar rights granted to
any other existing tenant as of the date of this Lease in the Building pursuant
to its lease, (iii) any decision to permit an existing tenant in the Expansion
Space to expand into additional space on the floor where its leased premises
exists even though such existing tenant may not have further rights to expand in
its lease, or (iv) any election by Divco West Group, LLC, or any affiliate
thereof, in its sole and absolute discretion to lease all or any portion of the
seventh (7th) floor of the Building, including without limitation any space on
the 7th floor of the Building that Divco West Group, LLC does not currently
lease.

          4.1  Expansion Right Procedure. If any Expansion Space is becomes
               -------------------------
available for lease as determined by Landlord in its sole and absolute
discretion, Landlord shall notify Tenant of the portion of the Expansion Space
that is available for leasing by Tenant on the rental rates and all other terms
and provisions contained in the notice by Landlord, which terms and provisions
may differ from those contained in the Lease (the "Expansion Notice"). Tenant
shall have five (5) business days within which to provide written notice to
Landlord that Tenant elects to lease such Expansion Space on the terms contained
in the Expansion Notice. If Landlord does not receive such written notice within
said time period, then it shall be conclusively deemed an election by Tenant not
to lease such Expansion Space.

          4.2  Effect of Non-Acceptance. If Tenant does not accept the offer to
               ------------------------
lease the portion of the Expansion Space contained in the Expansion Notice,
Landlord shall be free to lease all or any portion of the Expansion Space
(including, without limitation, any space that is part of the Expansion Space
but was not included in the Expansion Notice) to any other party on such terms
proposed in the Expansion Notice, or on any other terms which may be different
than the terms in the Expansion Space, in which case Tenant's right to lease all
or any portion of the Expansion Space shall automatically lapse and be of no
further force and effect, notwithstanding that Landlord may or may not actually
lease all or any portion of the Expansion Space to other parties. Tenant
acknowledge that Landlord shall have the right to lease portions of the
Expansion Space to different parties, but that Tenant's expansion right under
section 4 and its subsections only pertains to the Expansion Space contained in
an Expansion Notice.

          4.4  Election to Expand. If Tenant elects to expand as provided under
               ------------------
this section 4 and its subsections, the Expansion Space shall be included within
the Leased Premises as of said commencement date and on the other terms and
conditions set forth in the Expansion Notice. The parties shall promptly execute
an amendment to the Lease, in the form prepared by Landlord, to include in the
Lease the Expansion Space, the length of the term of the lease for the Expansion
Space (which may be different than the length of the term for the original
Leased Premises), the rental rate and such other terms and conditions for the
lease of the Expansion Space as are necessary or appropriate to incorporate the
terms and conditions of the lease of such Expansion Space under the Expansion
Notice. Tenant acknowledges that the length of the term and other provisions for
the Expansion Space may be different that the applicable provision for the lease
of the original Leased Premises, notwithstanding that the original Leased
Premises and the Expansion Space will be covered under one lease agreement if
Tenant leases the Expansion Space under section 4 and its subsections.

     5.  Letter of Credit Security Deposit. Pursuant to the terms of the Lease,
         ---------------------------------
a Security Deposit of $434,480.00 is required from Tenant. In lieu of depositing
cash for the full amount of the Security Deposit, Tenant shall have the right to
deposit a letter of credit for up to the full amount of the Security

                                       4
<PAGE>

Deposit, provided that at all times the amount of such letter of credit and cash
shall equal to full amount of the Security Deposit. Said letter of credit shall
be in the form of an irrevocable, unconditional and clean standby letter of
credit and otherwise in the form set forth below (the "Letter of Credit"). The
term Security Deposit shall mean the cash portion of the Security Deposit and
the Letter of Credit.

          5.1  Form of Letter of Credit. The Letter of Credit shall be issued by
               ------------------------
a national bank acceptable to Landlord in its reasonable discretion, with
offices in the San Francisco Bay Area that will accept and pay on any draw on
the Letter of Credit. The Letter of Credit shall be issued for a term of at
least twelve (12) months (with a term during the last year of the Lease Term of
at least one full month following the expiration of the Lease Term) and shall be
in a form and with such content acceptable to Landlord in its sole and absolute
discretion. Any Letter of Credit that Tenant delivers to Landlord in replacement
of an existing Letter of Credit shall be in an amount equal to the replaced
Letter of Credit (prior to any draws but subject to any reductions under section
5.2 below) so that the cash and Letter of Credit together equal the amount of
the Security Deposit specified in the Lease. Any such replacement Letter of
Credit shall be delivered to and received by Landlord no later than thirty (30)
days prior to the expiration of the term of the Letter of Credit then in effect.
If Tenant fails to deposit a replacement Letter of Credit or renew the expiring
Letter of Credit, Landlord shall have the right to draw upon the expiring Letter
of Credit for the full amount thereof after providing notice to Tenant that
Landlord intends to draw on the Letter of Credit and hold the same as Security
Deposit, unless Tenant provides a replacement for or extension to the expiring
Letter of Credit prior to a draw by Landlord of the expiring Letter of Credit;
provided, however, that if Landlord draws on such expiring Letter of Credit and
Tenant provides a replacement Letter of Credit which meets the requirements of
this section, Landlord shall promptly return to Tenant in cash that amount of
the Letter of Credit that had been drawn upon by Landlord. The Letter of Credit
shall expressly permit full and partial draws. If for any reason the Letter of
Credit does not permit partial draws, then Landlord shall have the right to make
a full draw on the Letter of Credit, notwithstanding that the full amount may
not be required to cure any default by Tenant. The Letter of Credit shall
designate Landlord as beneficiary and shall be transferable by beneficiary to
any transferee, successor, and assign (including any lender of Landlord) at no
cost or expense to beneficiary. The Letter of Credit shall provide that it may
be drawn by Landlord (or its assignee) upon presentation by Landlord to the
issuing bank (at its offices in the San Francisco Bay Area) of a sight draft(s),
together with a written statement executed by Landlord stating that the amount
requested is due Landlord under the Lease. The amount of the draw requested by
Landlord shall be payable by the bank without further inquiry or any Other
documentation or further action required of the bank, Landlord, or Tenant. All
costs and expenses to obtain the Letter of Credit and all renewals shall be
borne by Tenant.

          If the Letter of Credit is drawn upon by Landlord, Tenant shall,
within ten (10) days after written demand therefor, deposit cash with Landlord
in an amount sufficient to restore the Security Deposit to amount required under
the Lease and this Addendum. At all times the Security Deposit, whether in the
form of cash and/or Letter of Credit, shall be in the amount specified in the
Lease. The use, application or retention of the Letter of Credit, or any portion
thereof, by Landlord shall not prevent Landlord from exercising any other right
or remedy provided by this Lease or by law, it being intended that Landlord
shall not first be required to use all or any part of the Letter of Credit or
cash portion of the Security Deposit, and such use shall not operate as a
limitation on any recovery to which Landlord may otherwise be entitled. Tenant
shall not be entitled to any interest on the cash portion of the Security
Deposit. The exercise of any rights of Landlord to the Security Deposit shall
not constitute a waiver of nor relieve Tenant from any liability or obligation
for any default by Tenant. If Landlord draws upon the entire amount of the
Letter of Credit, Tenant may deliver a replacement Letter of Credit to Landlord,
instead of depositing cash with Landlord, equal to the original amount of the
Letter of Credit.

                                       5
<PAGE>

          5.2  Reduction after Time. The amount of the Security Deposit may be
               --------------------
reduced by $86,896.00 after each of the first four annual anniversary dates of
the Commencement Date; provided that (i) a default (after notice and the
expiration of the applicable cure period) by Tenant of any provision of the
Lease does not exist and no such default or breach occurred during the year
immediately prior to the effective date of the reduction under this section; and
(ii) at no time shall the Security Deposit be less than $86,896.00. If Tenant is
entitled to reduce the amount of the Letter of Credit pursuant to this paragraph
and Tenant delivers to Landlord written notice of its request to so reduce the
amount of the Security Deposit, then Tenant may, not less than (10) days after
Landlord's receipt of such notice, either obtain and deliver a new or amended
Letter of Credit to replace or amend, as the case may be, the then existing
Letter of Credit, in an amount required under this section.


                                       6
<PAGE>

                               PARKING AGREEMENT

     THIS AGREEMENT made as of November 12, 1999, between STANDARD PARKING
CORPORATION, an Illinois corporation ("Licensor") and BLAZE SOFTWARE, INC., a
California corporation ("Licensee").

     1.  The parties hereby acknowledge that Licensee has heretofore entered, or
is contemporaneously herewith entering, a certain office Lease dated as of
November 12, 1999 (the "Lease") with SJ Plaza, LLC, a Delaware limited liability
company ("Landlord") for certain leased premises known as Suites 800 and 900
(the "Premises") located in the building commonly known as 150 Almaden Blvd.,
San Jose, California ("Property").

     2.  Licensor hereby grants to Licensee and persons designated by Licensee a
license to use 50 parking spaces in the parking garage located on levels P2 and
               --
P3 of the main parking garage at Park Center Plaza, San Jose, California and 30
                                                                             --
parking spaces in the 5-story parking tower located at 185 Park Avenue, San
Jose, California (each such parking facility shall be referred to herein as the
"Garage") and not in the other levels of the parking facility at the Park Center
Plaza Complex. The term of such license shall commence on the Commencement Date
under the Lease and shall continue until the earlier to occur of the Expiration
Date under the Lease, or termination of the Lease or Licensee's abandonment of
the Premises thereunder. During the Term of this license, Licensee shall pay
Licensor the monthly charges established from time to time by Licensor for
parking in the Garage, payable in advance, to Licensor at 100 Park Center, Suite
104A, San Jose, CA 95113, attn.' Manager or such other place as Licensor may
from time to time designate by giving Licensee written notice thereof as
provided herein. The current market charge for each such space is $150.00, per
month. No deductions from the monthly charge shall be made for days at which the
Garage is not used by Licensee. However, Licensee may reduce the number of
parking spaces hereunder, at any time, by providing at least thirty (30) days
advance written notice to Licensor, accompanied by any key-card, sticker or
other identification or entrance system provided by Licensor; such cancellation
shall be irrevocable. Licensee may, from time to time, request additional
parking spaces, and if Licensor shall provide the same, such spaces shall be
provided and used on a month-to-month basis, and otherwise on the foregoing
terms and provisions, and such monthly charges as Licensor shall establish from
time to time. Licensee shall also pay to Licensor a deposit for each access or
parking card issued by Licensor to Licensee (and the current amount of such
deposit is $10.00 for each card).

     3.  Licensee shall at all times comply with all applicable ordinances,
rules, regulations, codes, laws, statutes and requirements of all federal,
state, county and municipal governmental bodies or their subdivisions respecting
the use of the Garage. Licensor reserves the right to adopt, modify and enforce
reasonable rules governing the use of the Garage from time to time, including
any key-card, sticker or other identification or entrance system, and hours of
operation. The rules set forth hereinafter are currently in effect. Licensor may
refuse to permit any person who violates such rules to park in the Garage, and
any violation of the Rules shall subject the car to removal from the Garage.

     4.  The parking spaces hereunder shall be provided on an unreserved "first-
come, first-served" basis except where otherwise expressly agreed in writing,
but Licensee shall be entitled to the number of spaces provided in this
agreement. Licensor shall have no liability whatsoever for any damage to
property or any other items located in the Garage, nor for any personal injuries
or death arising out of any matter relating to the Garage, and in all events,
Licensee agrees to look first to its insurance carrier and to require that
Licensee's employees look first to their respective insurance carriers for
payment of any losses sustained in connection with any use of the Garage.
Licensee hereby waives on

                                       1
<PAGE>

behalf of its insurance carriers all rights of subrogation against Licensor or
Licensor's agents. Licensor reserves the right to assign specific spaces and to
reserve spaces for visitors, small cars, handicapped persons and for other
tenants, guests of tenants or other parties; and Licensee and persons designated
by Licensee hereunder shall not park in any such assigned or reserved spaces.
Licensor also reserves the right to close all or any portion of the Garage in
order to make repairs or perform, maintenance services, or to alter, modify,
restripe or renovate the Garage, of if required by casualty, strike,
condemnation, act of God, governmental law or requirement or other reason beyond
Licensor's reasonable control. In such event, Licensor shall refund any prepaid
parking rent hereunder, prorated on a per diem basis. If for any other reason,
Licensee or persons properly designated by Licensee, shall be denied access to
the Garage, and licensee or such persons shall have complied with the Agreement
and this Agreement shall be in effect, Licensor's liability shall be limited to
such parking charges (excluding tickets for parking violations) incurred by
Licensee or such persons in utilizing alternative parking, which amount Licensor
shall pay upon presentation of documentation supporting Licensee's claims in
connection therewith.

     5.  If Licensee shall default under this Agreement, Licensor shall have all
rights available to it by reason of such default, including without limitation
the right (i) to refuse further access to the Garage by Licensee (whether by
deactivation of key-cards or otherwise), and (ii) to remove from the Garage any
vehicles hereunder which shall have been involved or shall have been owned or
driven by parties involved in causing such default, without liability therefor
whatsoever. In addition, if Licensee shall default under this Agreement,
Licensor shall have the right to cancel this Agreement on ten days written
notice unless within such ten day period, Licensee cures such default. Such
cancellation right shall be cumulative and in addition to any other rights or
remedies available to Licensor at law or equity.

     6.  All notices or demands under this Agreement shall be in writing and
shall be served personally, by national overnight air courier service or by
registered or certified mail, return receipt requested, addressed to:

            Licensor:                       with copies to:

            Standard Parking Corporation    Divco West Group, LLC
            101 Park Center, Suite 104A     100 Park Center Plaza, Suite 425
            San Jose, CA 95113              San Jose, CA 95113
                                            Attn.: Property Manager

            Licensee:

            Blaze Software, Inc.
            150 Almaden Blvd., Suite 800
            San Jose, CA 95113
            Attn.: Chief Financial officer
            ------------------------------

or such other addresses as the parties may therefore designate by written notice
so delivered. Each such notice or demand shall be deemed delivered immediately,
if personally delivered; the next business day, if sent by national overnight
air courier service; or on the date on which the return receipt is signed or
delivered, is refused or the notice is designated by the postal authorities as
not deliverable, as the case may be, if sent by certified mail.

                                       2
<PAGE>

     7.  Licensee shall have the right to assign all or any portion of its
rights under this Agreement to any assignee of all or part of Licensee's rights
under the Lease or any sublessee of all or part of the Premises. It is
understood and agreed that the identity of the Licensor may change from time to
time during the term of this Agreement and that Licensor's interest in this
Agreement shall be freely assignable. Licensee hereby consents to the
assignment, from time to time, of the initial or any successor Licensor's in
this Agreement to another Licensor, and upon any such assignment the Licensor
which is assigning its rights hereunder as set forth above shall be relieved of
any and all Obligations thereafter arising under this Agreement.

                                     Rules
                    (subject to modification by the garage)

     (i)    Garage hours shall be 6 a.m. to 8 p.m. or such other hours as
Licensor shall determine from time to time; however, monthly parkers shall have
access to the Garage at all times.

     (ii)   Cars must be parked entirely within the stall lines painted on the
floor, and only small cars may be parked in areas reserved for small cars.

     (iii)  All directional signs and arrows must be observed.

     (iv)   The speed limit shall be 5 miles per hour.

     (v)    Spaces reserved for handicapped parking must be used only by
vehicles properly designated.

     (vi) Parking is prohibited in all areas not expressly designated for
parking, including without
limitation:

          (a)  areas not striped for parking,
          (b)  aisles,
          (c)  where "no parking" signs are posted,
          (d)  ramps, and
          (e)  loading zones.

     (vii)   Parking stickers, key cards or any other devices or forms of
identification or entry supplied by Licensor shall remain the property of
Licensor. Such devices must be displayed as requested and may not be obliterated
in any manner. The serial number of the parking identification device may not be
obliterated. Devices are not transferable and any device in the possession of an
unauthorized holder will be void.

     (viii)  Monthly fees shall be payable in advance prior to the first day of
each month. Failure to do so will automatically cancel parking privileges and a
charge at the prevailing daily parking rate will be due. No deductions or
allowances from the monthly rate will be made for days on which the Garage is
not used by Licensee or its designees.

     (ix)   Garage managers or attendants are not authorized to make or allow
any exceptions to the rules.

     (x)    Every parker is required to park and lock his own car.

                                       3
<PAGE>
     (xi) Loss or theft of parking identification key cards or other such
devices must be reported to Licensor or any garage manager immediately. Any
parking devices reported lost or stolen found on any unauthorized car will be
confiscated and the illegal holder will be subject to prosecution. Lost or
stolen devices found by Licensee or its employees must be reported to the office
of the garage immediately.

     (xii)  Washing, waxing, cleaning or servicing of any vehicle by the
customer and/or his agents is prohibited. Parking spaces may be used only for
parking automobiles, SUV vehicles, standard pick-up trucks and motorcycles.

     (xiii)  By signing this Parking Agreement, Licensee agrees to acquaint all
persons to whom Licensee assigns parking spaces of these rules.

LICENSOR:                              LICENSEE:

STANDARD PARKING CORPORATION,          BLAZE SOFTWARE, INC.,
An Illinois corporation                a California corporation

By:        /s/ Scott L. Smith          By:  /s/ Gary Shroyer
           ------------------               -------------------
Name:          Scott L. Smith          Name:    Gary Shroyer
           ------------------               -----------------
Its:       President                   Its:    VP CFO
           ------------------               ----------------

                                      4