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                                                                    Exhibit 10.8

                             BASIC LEASE INFORMATION
                                 INDUSTRIAL NET

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<S>                                        <C>

LEASE DATE:                                 April 2, 1999

TENANT:                                     Cascade Microtech, Inc., an Oregon corporation

TENANT'S NOTICE ADDRESS:                    Grant Bennett, Facility Manager
                                            2430 NW 206th Avenue, Beaverton, OR 97006

TENANT'S BILLING ADDRESS:                   2430 NW 206th Avenue, Beaverton, OR 97006

TENANT CONTACT:   Grant Bennett             PHONE NUMBER:     503.601.1000
                                            FAX NUMBER:       503.601.1001

LANDLORD:                                   Spieker Properties, L.P., a California limited
                                            Partnership

LANDLORD'S NOTICE ADDRESS:                  4949 SW Meadows Road, Suite 260
                                            Lake Oswego, OR 97035

LANDLORD'S REMITTANCE ADDRESS:              Department 30211
                                            P.O. Box 3900
                                            Portland, OR 97208-3900

Project Description:                        Phase I, II & III of the Nimbus Corporate Center
                                            Beaverton, OR 97008

Building Description:                       Building 7, 9100 SW Gemini Drive
                                            Beaverton, OR 97008

Premises:                                   Approximately 58,817 rentable square feet (rsf)

Permitted Use:                              General Office, Engineering, Light Manufacturing,
                                            Shipping and Receiving and all uses allowed under
                                            applicable zoning

Parking Density:                            3.5 non-exclusive surface stalls per 1,000 rsf at no
                                            charge (including visitor, handicapped stalls and truck/staging areas)

Scheduled Term Commencement Date:           September 1, 1999

Schedule Length of Term:                    One hundred twenty (120) months

Scheduled Term Expiration Date:             August 31, 2009

Rent:

         Base Rent:                         09/01/00-12/31/99  $36,712.00 per month triple net
                                            01/01/00-08/31/01  $55,876.00 per month triple net
                                            09/01/01-08/31/03  $58,817.00 per month triple net
                                            09/01/03-08/31/05  $64,698.00 per month triple net
                                            09/01/05-08/31/07  $67,640.00 per month triple net


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                                            09/01/07-08/31/09  $70,580.00 per month triple net

Estimated First Year Operating Expenses:    $12,272.00 per month

Security Deposit:                           $70,580.00
                                            (See Paragraph 19)

Tenant's Proportionate Share:
         Of Building:                        N/A

         Of Project:                         0.13%

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The foregoing Basic Lease Information is incorporated into and made a part of
this Lease. Each reference in this Lease to any of the Basic Lease Information
shall mean the respective information above and shall be construed to
incorporate all of the terms provided under the particular Lease paragraph
pertaining to such information. In the event of any conflict between the Basic
Lease Information and the Lease, the latter shall control.


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LANDLORD                                             TENANT

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Spieker Properties, L.P.,                            Cascade Microtech, Inc.
a California limited partnership                     an Oregon corporation

By:      Spieker Properties, Inc.
         a Maryland corporation,
         its general partner

By:               /S/ LYNDA M. CLARKE                By:               /S/ ERIC W. STRID
         -----------------------------------                  -----------------------------------
         Lynda M. Clarke                                      Eric W. Strid
Its:     Vice President                              Its:     Chief Executive Office

Date:    4-2-99                                      Date:    April 2, 1999


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                                      LEASE

THIS LEASE is made as of the 2nd day of April, 1999, by and between Spieker
Properties, L.P., a California limited partnership (hereinafter called
"Landlord"), and Cascade Microtech, Inc. an Oregon corporation (hereinafter
called "Tenant).

                                   1. PREMISES

         Landlord leases to Tenant and Tenant leases from Landlord, upon the
terms and conditions hereinafter set forth, those premises (the "Premises")
outlined in red on Exhibit B and described in the Basic Lease Information
together with the nonexclusive right to use all common areas of the Building and
the Project. The Premises shall be all or part of a building (the "Building")
and of a project (the "Project"), which may consist of more than one building
and additional facilities, as described in the Basic Lease Information. The
Building and Project are outlined in blue and green respectively on Exhibit B.
Landlord and Tenant acknowledge that physical changes may occur from time to
time in the Premises, Building or Project, and that the number of buildings and
additional facilities which constitute the project may change from time to time,
which may result in an adjustment in Tenant's Proportionate Share, as defined in
the Basic Lease Information, as provided in Paragraph 7.A.

                      2. POSSESSION AND LEASE COMMENCEMENT


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<PAGE>


B. Construction of Improvements. If this Lease pertains to a Building to be
constructed or improvements to be constructed within a Building, the provisions
of this Paragraph 2.B. shall apply in lieu of the provisions of Paragraph 2.A.
above and the term commencement date ("Tern Commencement Date") shall be the
earlier of the date on which: (1) Tenant takes possession of some or all of the
Premises; or (2) the improvements to be constructed or performed in the Premises
by Landlord (if any) shall have been substantially completed in accordance with
the plans and specifications, if any, described on Exhibit C and Tenant's taking
of possession of the Premises; or (2) the improvements to be constructed or
performed in the Premises by Landlord (if any) shall have been substantially
completed in accordance with the plans and specifications, if any, described on
Exhibit C and Tenant's taking of possession of the Premises or any part thereof
shall constitute Tenant's confirmation of substantial completion for all
purposes hereof, whether or not substantial completion of the Building or
Project shall have occurred. Landlord and Tenant shall complete a mutually
agreed upon punchlist within five (5) business days of Tenant's possession of
the Premises. Landlord shall use commercially reasonable efforts to complete
said punchlist items within thirty (30) days therefrom. If for any reason
landlord cannot deliver possession of the Premises to Tenant on the scheduled
Term Commencement Date, Landlord shall not be subject to any liability therefor,
not shall Landlord be in default hereunder not shall such failure affect the
validity of this Lease, and Tenant agrees to accept possession of the Premises
at such time as such improvements have been substantially completed, which date
shall then be deemed the Term Commencement Date. Tenant shall not be liable for
any Rent for any period prior to the Term Commencement Date (but without
affecting any obligations of Tenant under any improvement agreement appended to
this Lease). In the event of any dispute as to substantial completion of work
performed or required to be performed by Landlord, the certificate of Landlord's
architect or general contractor shall be conclusive. Substantial completion
shall have occurred notwithstanding Tenant's submission of a punchlist to
Landlord, which Tenant shall submit, if at all, within three (3) business days
after the Term Commencement Date or otherwise in accordance with any improvement
agreement appended to this Lease. Upon Landlord's request, Tenant shall promptly
execute and return to landlord a "Start-Up Letter" in which Tenant shall agree,
among other things, to acceptance of the Premises and to the determination of
the Term Commencement Date, in accordance with the terms of this Lease, but
Tenant's failure or refusal to do so shall not negate Tenant's acceptance of the
Premises or affect determination of the Term Commencement Date. Notwithstanding
anything to the contrary contained in this Paragraph 2.B., Tenant's rent shall
commence after the Beneficial Occupancy period as defined in Paragraph 38,A,
herein.

                                     3. TERM

         The term of this Lease (the "Term") shall commence on the Tern
Commencement Date and continue in full force and effect for the number of months
specified as the Length of Term in the Basic Lease Information or until this
Lease is terminated as otherwise provided herein. If the Term Commencement Date
is a date other than the first day of the calendar month, the Term shall be the
number of months of the Length of Term in addition to the remainder of the
calendar month following the Term Commencement Date.

                                     4. USE

A. General. Tenant shall use the Premises for the permitted use specified in the
Basic Lease Information ("Permitted Use") and for no other use or purpose.
Tenant shall use reasonable efforts to control Tenant's employees, agents,
customers, visitors, invitees, licensees, contractors, assignees and subtenants
(collectively, "Tenant's Parties") in such a manner that Tenant and Tenant's
Parties cumulatively do not exceed the parking density specified in the Basic
Lease Information (the "Parking Density") at any time. So long as Tenant is
occupying the Premises, Tenant and Tenant's Parties shall have the nonexclusive
right to use, in common with other parties occupying the Building or Project,
the parking areas, driveways and other common areas of the Building and Project,
subject to the terms of this Lease and such rules and regulations as Landlord
may from time to time prescribe. Landlord reserves the right, with reasonable
notice but without liability to Tenant, and without the same constituting an
actual or constructive eviction, to alter or modify the common areas from time
to time, including the location and configuration thereof, and the amenities and
facilities which Landlord may determine to provide from time to time; however,
in no event shall Tenant's parking ratio be reduced by said modifications.


                                       3
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B. Limitations. Tenant shall not permit any odors, smoke, dust, gas, substances,
noise or vibrations to emanate from the Premises or from any portion of the
common areas as a result of Tenant's or any Tenant's Party's use thereof, not
take any action which would constitute a nuisance or would disturb, obstruct or
endanger any other tenants or occupants of the Building or Project or elsewhere,
or interfere with their use of their respective premises or common areas.
Storage outside the Premises of materials, vehicles or any other items in
prohibited; however, Tenant shall be allowed to store liquid nitrogen outside of
its premises, in a safe and clean manner. Tenant shall not use or allow the
Premises to be used for any immoral, improper or unlawful purpose, nor shall
Tenant cause or maintain or permit any nuisance in, on or about the Premises.
Tenant shall not commit or suffer the commission of any waste in, on or about
the Premises. Tenant shall not allow any sale by auction upon the Premises, or
place any loads upon the floors, walls or ceilings which could endanger the
structure, or place any harmful substances in the drainage system of the
Building or Project. No waste, materials or refuse shall be dumped upon or
permitted to remain outside the Premises except in trash containers placed
inside exterior enclosures designated for the purpose by Landlord. Landlord
shall not be responsible to Tenant for the noncompliance by any other tenant or
occupant of the Building or Project with any of the above-referenced rules or
any other terms or provisions of such tenant's or occupant's lease or other
contract.

C. Compliance with Regulations. By entering the Premises, Tenant accepts the
Premises in the condition existing as of the date of such entry. Landlord
represents to the best of its actual knowledge the Building and all improvements
constructed by Landlord shall comply with all governmental rules and regulations
at the Term Commencement Date. Tenant shall at its sole cost and expense
strictly comply with all existing or future applicable municipal, state and
federal and other governmental statutes, rules, requirements, regulations, laws
and ordinances, including zoning ordinances and regulations, and covenants,
easements and restrictions of record governing and relating to the use,
occupancy or possession of the Premises, to Tenant's use of the common areas, or
to the use, storage, generation or disposal of Hazardous Materials (hereinafter
defined) (collectively "Regulations") and any other noncompliance with
Regulations by Landlord in the construction of the Building, the Project or any
other Existing Improvements. Tenant shall at its sole cost and expense obtain
any and all licenses or permits necessary for Tenant's use of the Premises.
Tenant shall at its sole cost and expense promptly comply with the requirements
of any board of fire underwriters or other similar body now or hereafter
constituted. Tenant shall not do or permit anything to be done in, on, under or
about the Project or bring or keep anything which will in any way increase the
rate of any insurance upon the Premises, Building or Project or upon any
contents therein or cause a cancellation of said insurance or otherwise affect
said insurance in any manner. Tenant shall indemnify, defend (by counsel
reasonably acceptable to Landlord), protect and hold Landlord harmless from and
against any loss, cost, expense, damage, attorneys' fees or liability arising
out of the failure of Tenant to comply with any Regulation and any other
noncompliance with Regulations by Landlord in the construction of the Building,
the Project or any other Existing improvements. Notwithstanding anything to the
contrary, Landlord shall be responsible at its sole cost and expense to comply
with ADA standards in the common areas of the project. Tenant shall have the
sole responsibility for complying, at Tenant's cost, with any and all provisions
of the Americans with Disabilities Act of 1990, as it has been and may later be
amended ("ADA"), (I) with respect to the Premises; and (ii) with respect to the
common areas of the Project where in the case of this clause (ii) such
compliance has been brought about by: (A) any Tenant Improvements or Alterations
to the Premises or to the common areas made by or on behalf of Tenant, whether
by Landlord or otherwise, and whether performed before or after the Term
Commencement Date; (B) requirements of Tenant's employees, or any changes to
Tenant's use of the Premises; or (C) any architectural barriers caused by
Tenant's installation of any equipment, fixtures, furniture, or other personal
property in or about the Premises (items (i) and (ii) collectively, "Tenant's
ADA responsibilities"). Tenant shall indemnify, defend and hold Landlord, its
agents and employees harmless from and against any and all claims, damages, or
liabilities (including, without limitation, reasonable attorneys' fees and
costs) arising directly or indirectly from Tenant's failure to satisfy any of
Tenant's ADA Responsibilities. Landlord shall indemnify, defend and hold Tenant,
its agents and employees harmless from and against any and all claims, damages
or liabilities arising directly or indirectly from Landlord's failure to comply
with any obligations of a landlord under the ADA, other than such claims,
damages or liabilities arising from Tenant's failure to satisfy any of Tenant's
ADA Responsibilities; provided, however, that Landlord may treat costs of ADA
compliance with respect to the common areas of the Project but in no event in
excess of $100,000.00 in the aggregate to the extent incurred after the Term



                                       4
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Commencement Date as an Operating Expense to be amortized over no few than sixty
(60) months. Tenant's obligations pursuant to the foregoing indemnity shall
survive the expiration or earlier termination of this Lease.

D. Hazardous Materials. As used in this Lease, "Hazardous Materials" shall
include, but not be limited to, hazardous, toxic and radioactive materials and
those substances defined as "hazardous substances," "hazardous wastes," "toxic
substances," or other similar designations in any Regulation. Tenant shall not
cause, or allow any of Tenant's Parties to cause, any Hazardous Materials to be
handled, used generated, stored, released or disposed of in, on, under or about
the Premises, the Building or the Project or surrounding land or environment in
violation of any Regulations. Tenant must obtain Landlord's written consent
prior to the introduction of any Hazardous Materials onto the Project.
Notwithstanding the foregoing, Tenant may handle, store, use and dispose of any
such Hazardous Materials in a safe and lawful manner and never allow such
Hazardous Materials to contaminate the Premises, Building, or Project or
surrounding land or environment, which indemnity shall include, without
limitation, damages for personal or bodily injury, property damage, damage to
the environment or natural resources occurring on or off the Premises, losses
attributable to diminution in value or adverse effects on marketability, the
cost of any investigation, monitoring, government oversight, repair, removal,
remediation, restoration, abatement, and disposal, and the preparation of any
closure or other required plans, whether such action is required or necessary
prior to or following the expiration or earlier termination of this Lease.
Neither the consent by Landlord to the use, generation, storage, release or
disposal of Hazardous Materials nor the strict compliance by Tenant with all
laws pertaining to Hazardous Materials shall excuse Tenant from Tenant's
obligation of indemnification pursuant to this Paragraph 4>d. Tenant's
obligations pursuant to the foregoing indemnity shall survive the expiration or
earlier termination of this Lease. Landlord shall indemnify, defend and hold
Tenant harmless from and against any and all claims, judgments, damages,
penalties, fines, costs, liabilities or losses, including without limitation
reasonable attorneys' fees and costs, arising out of any Hazardous Material in,
on or about the Project or the Premises which was created, handled, placed,
stored, used, transported or disposed of by Landlord or by Landlord's agents,
employees, invitees or representatives in violation of applicable Regulations,
excluding, however, any Hazardous Material whose presence was caused by Tenant
or any of Tenant's Parties. Landlord shall also indemnify, defend and hold
Tenant harmless from and against any and all claims, judgments, damages,
penalties, fines, costs, liabilities or losses, including without limitation
reasonable attorney's fees and costs, arising out of any Hazardous Material that
migrates onto or under the Project of the Premises from any source or sources
not within the Project or the Premises excluding, however, any Hazardous
Material whose presence or migration was caused by Tenant or any of Tenant's
Parties. Landlord's obligations pursuant to the foregoing indemnity shall
survive the expiration or earlier termination of this Lease.

                            5. RULES AND REGULATIONS

         Tenant shall faithfully observe and comply with the building rules and
regulations attached hereto as Exhibit A and any other reasonable rules and
regulations any an reasonable modifications or additions thereto which Landlord
may from time to time prescribe in writing for the purpose of maintaining the
proper care, cleanliness, safety, traffic flow and general order of the Premises
or the Building or Project. Tenant shall cause Tenant's Parties to comply with
such rules and regulations. Landlord shall use commercially reasonable efforts
to ensure compliance by any other tenant or occupant of the Building or Project
with any of such rules and regulations, any other tenant's or occupant's lease
or any Regulations.

                                     6. RENT

A. Base Rent. Tenant shall pay to Landlord and Landlord shall receive, without
notice or demand throughout the Term, Base Rent as specified in the Basic Lease
Information, payable in monthly installments in advance on or before the first
day of each calendar month, in lawful money of the United States, without
deduction or offset whatsoever, except as expressly provided herein, at the
Remittance Address specified in the Basic Lease Information or to such other
place as landlord may from time to time designate in writing. Base Rent for the
first full month of the Term shall be paid by Tenant upon Tenant's execution of
this Lease. If the obligation for payment of Base Rent commences on a day other
than the first day of a month, then Base Rent shall be prorated and the prorated
installment shall be paid on the first day


                                       5
<PAGE>


of the calendar month next succeeding the Term Commencement Date. The Base Rent
payable by Tenant hereunder is subject to adjustment as provided elsewhere in
this Lease, as applicable. As used herein, the term "Base Rent" shall mean the
Base Rent specified in the Basic Lease Information as it may be so adjusted from
time to time.

B. Additional Rent. All monies other than Base Rent required to be paid by
Tenant hereunder, including, but not limited to, Tenant's Proportionate Share of
Operating Expenses, as specified in Paragraph 7 of this Lease, charges to be
paid by Tenant under Paragraph 15, the interest and late charge described in
Paragraphs 26.C and D., and any monies spent by Landlord pursuant to Paragraph
30, shall be considered additional rent ("Additional Rent"). "Rent" shall mean
Base Rent and Additional Rent.

                              7. OPERATING EXPENSES

A. Operating Expenses. In addition to the Base Rent required to be paid
hereunder, Tenant shall pay as Additional Rent, Tenant's Proportionate Share of
the Building and/or Project (as applicable), as defined in the Basic Lease
Information, of Operating Expenses (defined below) in the manner set forth
below. Tenant shall pay the applicable Tenant's Proportionate Share of each such
Operating Expenses. Landlord and Tenant acknowledge that if the number of
buildings which constitute the Project increases or decreases, or if physical
changes are made to the Premises, Building or Project or the configuration of
any thereof, Landlord may at its discretion reasonably adjust Tenant's
Proportionate Share of the Building or Project to reflect the change. Landlord's
determination or Tenant's Proportionate Share of the Building and the Project
shall be conclusive so long as it is reasonable and consistently applied.
"Operating Expenses" shall mean all expenses and costs of every kind of nature
which Landlord shall pay or become obligated to pay, because of or in connection
with the ownership, management, maintenance, repair, preservation, replacement
and operation of the Building or Project and its supporting facilities and such
additional facilities now and in subsequent years as may be determined by
Landlord to be necessary or desirable to the Building and/or Project (as
determined in a reasonable manner) other than those expenses and costs which are
specifically attributable to Tenant or which are expressly made the financial
responsibility of Landlord or specific tenants of the Building or Project
pursuant to this Lease. Operating Expenses shall include, but are not limited
to, the following:

         (1) Taxes. All real property taxes and assessments, possessory interest
         taxes, sales taxes, personal property taxes, business or license taxes
         or fees, gross receipts taxes, service payments in lieu of such taxes
         or fees, annual or periodic license or use fees, excises, transit
         charges, and other impositions, general and special, ordinary and
         extraordinary, unforeseen as well as foreseen, of any kind (including
         fees "in-lieu" of such tax or assessment) which are now or hereafter
         assessed, levied, charged, confirmed, or imposed by any public
         authority upon the Building or Project, its operations or the Rent (or
         any portion or component thereof), or any tax, assessment or fee
         imposed in substitution, partially or totally, of any of the above.
         Operating Expenses shall also include any taxes, assessments,
         reassessments, or other fees or impositions with respect to the
         development, leasing, management, maintenance, alteration, repair, use
         or occupancy by Tenant of the Premises, Building or Project or any
         portion thereof, including, without limitation, by or for Tenant, and
         all increases therein or reassessments thereof whether the increases or
         reassessments result from increased rate and/or valuation (whether upon
         a transfer of the Building or Project or any portion thereof or any
         interest therein or for any other reason). Operating Expenses shall not
         include inheritance or estate taxes imposed upon or assessed against
         the interest of any person in the Project, or taxes computed upon the
         basis of the net income of any owners of any interest in the Project.
         If it shall not be lawful for Tenant to reimburse Landlord for all or
         any part of such taxes, the monthly rental payable to Landlord under
         this Lease shall be revised to net Landlord the same net rental after
         imposition of any such taxes by Landlord as would have been payable to
         Landlord prior to the payment of any such taxes. All said taxes shall
         be prorated over the Project as defined in Paragraph 1.

         (2) Insurance. All insurance premiums and costs, including, but not
         limited to, any deductible amounts, premiums and other costs of
         insurance incurred by Landlord, including for the insurance coverage
         set forth in Paragraph 8.A herein.



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         (3)      Common Area Maintenance.

                  (a) Repairs, replacements, and general maintenance of and for
                  the Building and Project and public and common areas and
                  facilities of and comprising the Building and Project,
                  including, but not limited to, the roof and roof membrane,
                  elevators, mechanical rooms, alarm systems, pest
                  extermination, landscaped areas, parking and service areas,
                  driveways, sidewalks, truck staging areas, rail spur areas,
                  fire sprinkler systems, sanitary and storm sewer lines,
                  utility services, hearing/ventilation/air conditioning
                  systems, electrical, mechanical or other systems, telephone
                  equipment and wiring servicing, plumbing, lighting and any
                  other items or areas which affect the operation or appearance
                  of the Building or Project, which determination shall be at
                  Landlord's discretion, except for those items expressly made
                  the financial responsibility of Landlord pursuant to Paragraph
                  10 hereof, those items to the extent paid for by the proceeds
                  of insurance; and those attributable solely or jointly to
                  specific tenants of the Building or Project.

                  (b) Repairs, replacements, and general maintenance shall
                  include the cost of any capital improvements in excess of
                  $20,000 made to or capital assets acquired for the Project or
                  Building that in Landlord's discretion may reduce any other
                  Operating Expenses, including present or future repair work,
                  are reasonably necessary for the health and safety of the
                  occupants of the Building or Project, or are required to
                  comply with any Regulation, such costs or allocable portions
                  thereof to be amortized over the useful life of said
                  maintenance or capital improvements together with Tenant's
                  prorata share of Landlord's interest on funds plus reasonable
                  finance charges borrowed for said purposes.

                  (c) Payment under or for any easement, license, permit,
                  operating agreement, declaration, restrictive covenant or
                  instrument relating to the Building or Project.

(d)               All expenses and rental related to services and costs of
                  supplies, materials and equipment used in operating, managing
                  and maintaining the Premises, Building and Project, the
                  equipment therein and the adjacent sidewalks, driveways,
                  parking and service areas, including, without limitation,
                  expenses related to service agreements regarding security,
                  fire and other alarm systems, janitorial services to the
                  extent not addressed in Paragraph 11 hereof, window cleaning,
                  elevator maintenance, Building exterior maintenance,
                  landscaping and expenses related to the administration,
                  management and operation of the Project, including without
                  limitation salaries, wages and benefits below the title of
                  Vice President and limited to those parties working directly
                  on the Project and prorated appropriately, as reasonably
                  determined by Landlord, among the Building(s) for which they
                  are responsible.

                  (e) The cost of supplying any services and utilities which
                  benefit all or a portion of the Premises, Building or Project
                  to the extent not addressed in Paragraph 15 hereof.

                  (f) Legal expenses and the cost of audits by certified public
                  accountants; provided, however, that legal expenses chargeable
                  as Operating Expenses shall not include the cost of
                  negotiating leases, collecting rents, evicting tenants nor
                  shall it include costs incurred in legal proceedings with or
                  against any tenant or to enforce the provisions of any lease.

                  (g) A management and accounting cost recovery fee equal to
                  three percent (3%) of the sum of the Project's base rents and
                  Operating Expenses (0ther than such management and accounting
                  fee).

         In addition, notwithstanding anything in the definition of Operating
         Expenses in this Lease to the contrary, Operating Expenses shall not
         include the following, except to the extent specifically provided:


                                       7
<PAGE>

         (i)      Any ground lease rental;

         (ii)     Costs of capital improvements, replacements or equipment and
                  any depreciation or amortization expenses thereon, except to
                  the extent included in Operating Expenses in Paragraph 7.A of
                  this Lease;

         (iii)    Rentals for items (except when needed in connection with
                  normal repairs and maintenance of permanent systems) which if
                  purchased, rather that rented, would constitute a capital
                  improvement which is specifically excluded in clause (ii)
                  above (excluding, however, equipment not affixed to the
                  Building or Project which is used in providing janitorial or
                  similar services);

         (iv)     Costs incurred by Landlord for the repair of damage to the
                  Building or Project, to the extent that Landlord is reimbursed
                  by insurance proceeds;

         (v)      Costs, including permit, license and inspection costs,
                  incurred with respect tot he installation of tenant or other
                  occupant improvements made for tenants or other occupants in
                  the Building or the Project or incurred in renovating or
                  otherwise improving, decorating, painting or redecorating
                  vacant space for or the premises of other tenants or other
                  occupants of the Building.

         (vi)     Marketing costs, including leasing commissions, attorneys'
                  fees in connection with the negotiation and preparation or
                  enforcement of letters, deal memos, letters of intent, leases,
                  subleases and/or assignments, space planning costs, and other
                  costs and expenses incurred in connection with lease, sublease
                  and/or assignment negotiations and transactions with present
                  or prospective tenants or other occupants of the Building or
                  the Project;

         (vii)    Costs incurred by Landlord due to the violation by Landlord of
                  the terms and conditions of any lease of space in the Building
                  or the Project;

         (viii)   Except to the extent included in Operating Expenses in
                  Paragraph 7.A(3) above, interest, principal, points and fees
                  on debt or amortization payments on any mortgage or deed of
                  trust or any other debt instrument encumbering the Building or
                  Project or the land on which the Building or Project is
                  situated;

         (ix)     Except for making repairs or keeping permanent systems in
                  operation while repairs are being made, rentals and other
                  related expenses incurred in leasing air conditioning systems,
                  elevators or other equipment ordinarily considered to be of a
                  capital nature, except equipment not affixed to the Building
                  or Project which is used in providing janitorial or similar
                  services;

         (x)      Advertising and promotional expenditures (except for retail
                  property promotions);

         (xi)     Costs incurred in connection with upgrading the Building or
                  Project to comply with disability, life, fire and safety codes
                  in effect prior to the issuance of the temporary certificate
                  of occupancy for the Building;

         (xii)    Interest, fines or penalties incurred as a result of
                  Landlord's failure to make payments when due unless such
                  failure is commercially reasonable under the circumstances;

         (xiii)   Costs arising from Landlord's charitable or political
                  contributions;

         (xiv)    Costs for acquisition of sculpture, paintings or other objects
                  of art in common areas;



                                       8
<PAGE>

         (xv)     The depreciation of the Building and other real property
                  structures in the Project;

         (xvi)    Landlord's general corporate overhead and general
                  administrative expenses not related to the operation of the
                  Building or the Project; except as specifically set forth in
                  Paragraph 7.A of this Lease;

         (xvii)   Any bad debt loss, rent or reserves for bad debts or rent
                  loss, or reserves for equipment or capital replacement.

If the rentable area of the Building and/or Project is not fully occupied during
any fiscal year of the Term as determined by Landlord, an adjustment may be made
in Landlord's discretion in computing the Operating Expenses for such year so
that Tenant pays an equitable portion of all variable items (e.g., utilities,
janitorial services and other component expenses that are affected by variations
in occupancy levels) of Operating Expenses, as reasonably determined by
Landlord; provided, however, that in no event shall Landlord be entitled to
collect in excess of one hundred percent (100%) of the total Operating Expenses
from all of the tenants in the Building or Project, as the case may be.

         Operating Expenses shall not include the cost of providing tenant
improvements or other specific costs incurred for the account of, separately
billed to and paid by specific tenants of the Building or Project, the initial
construction cost of the Building, or debt service on any mortgage or deed of
trust recorded with respect to the Project other than pursuant to Paragraph
7.A(3)(b) above. Notwithstanding anything herein to the contrary, in any
instance wherein Landlord, in Landlord's sole discretion, deems Tenant to be
responsible for any amounts greater than Tenant's Proportionate Share, Landlord
shall have the right to allocate costs in any manner Landlord reasonable deems
appropriate.

         The above enumeration of services and facilities shall not be deemed to
impose an obligation on Landlord to make available or provide such services or
facilities except to the extent if any that Landlord has specifically agreed
elsewhere in this Lease to make the same available or provide the same. Without
limiting the generality of the foregoing, Tenant acknowledges and agrees that it
shall be responsible for providing adequate security for its use of the
Premises, the Building and the Project and that Landlord shall have no
obligation or liability with respect thereto, except to the extent if any that
Landlord has specifically agreed elsewhere in this Lease to provide the same.

B. Payment of Estimated Operating Expense. "Estimated Operating Expenses" for
any particular year shall mean Landlord's estimate of the Operating Expenses for
such fiscal year made with respect to such fiscal year as hereinafter provided.
Landlord shall have the right from time to time to revise its fiscal year and
interim accounting periods so long as the periods as so revised are reconciled
with prior periods in a reasonable manner. During the last month of each fiscal
year during the Term, or as soon thereafter as practicable, Landlord shall give
Tenant written notice of the estimated Operating Expenses for the ensuring
fiscal year. Tenant shall pay Tenant's Proportionate Share of the Estimate
Operating Expenses with installments of Base Rent for the fiscal year to which
the Estimate Operating Expenses applies in monthly installments on the first day
of each calendar month during such year, in advance. Such payment shall be
construed to be Additional Rent for all purposes hereunder. If at any time
during the course of the fiscal year, Landlord determines that Operating
Expenses are projected to vary from the then Estimated Operating Expenses by
more than five percent (5%), Landlord may, by written notice to Tenant, revise
the Estimated Operating Expenses 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 has paid to Landlord Tenant's
Proportionate Share of the revised Estimated Operating Expenses for such year,
such revised installment amounts to be Additional Rent for all purposes
hereunder.

C. Computation of Operating Expense Adjustment. "Operating Expense Adjustment"
shall mean the difference between Estimated Operating Expenses and actual
Operating Expenses for any fiscal year determined as hereinafter provided.
Within one hundred twenty (120) days after the end of each fiscal year just
ended, accompanied by a computation of Operating Expense Adjustment. If such
statement shows that Tenant's payment based upon Estimated Operating Expenses is
less than Tenant's Proportionate Share of Operating Expenses, then Tenant shall
pay to Landlord the difference within twenty (20) days after receipt


                                       9
<PAGE>

of such statement, such payment to constitute Additional Rent for all purposes
hereunder. If such statement shows that Tenant's payments of Estimated Operating
Expenses exceed Tenant's Proportionate Share of Operating Expenses, then
(provided that Tenant is not in default under this Lease) Landlord shall pay to
Tenant the difference within twenty (20) days after delivery of such statement
to Tenant. If this Lease has been terminated or the Term hereof has expired
prior to the date of such statement, then the Operating Expense Adjustment shall
be paid by the appropriate party within twenty (20) days after the date of
delivery of the statement. Should this Lease commence or terminate at any time
other than the first day of the fiscal year, Tenant's Proportionate Share of the
Operating Expense Adjustment shall be prorated based on a month of 30 days and
the number of calendar months during such fiscal year that this Lease is in
effect. Notwithstanding anything to the contrary contained in Paragraph 7.A or
7.B, Landlord's failure to provide any notices or statements within the time
periods specified in those paragraphs shall in no way excuse Tenant from its
obligation to pay Tenant's Proportionate Share of Operating Expenses.

D. Net Lease. This shall be a triple net Lease and Base Rent shall be paid to
Landlord absolutely net of all costs and expenses, except as specifically
provided to the contrary in this Lease. The provisions for payment of Operating
Expenses and the Operating Expense Adjustment are intended to pass on to Tenant
and reimburse Landlord for all costs and expenses of the nature described in
Paragraph 7.A incurred in connection with the ownership, management,
maintenance, repair, preservation, replacement and operation of the Building
and/or Project and its supporting facilities and such additional facilities now
and in subsequent years as may be determined by Landlord to be necessary or
desirable to the Building and/or Project, and with all such expenses passed
through to the Tenant as appropriate based on generally accepted accounting
principals.

E. Tenant Audit. If Tenant shall dispute the amount set forth in any statement
provided by Landlord under Paragraph 7.B or 7.C above, Tenant shall have the
right, not later than twenty (20) days following receipt of such statement and
upon the condition that Tenant shall first deposit with Landlord the full amount
in dispute, to cause Landlord's books and records with respect to Operating
Expenses for such fiscal year to be audited by certified public accountants
selected by Tenant and subject to Landlord's reasonable right of approval. The
Operating Expense Adjustment shall be appropriately adjusted on the basis of
such audit. If such audit discloses a liability for a refund in excess of five
percent (5%) of Tenant's Proportionate Share of the Operating Expenses
previously reported, the cost of such audit shall be borne by Landlord,
otherwise the cost of such audit shall be paid by Tenant. If Tenant shall not
request an audit in accordance with the provisions of this Paragraph 7.E within
twenty (20) days after receipt of Landlord's statement provided pursuant to
Paragraph 7.B or 7.C, such statement shall be final and binding for all purposes
hereof.

                        8. INSURANCE AND INDEMNIFICATION

A. Landlord's Insurance. All insurance maintained by Landlord shall be for the
sole benefit of Landlord and under Landlord's sole control.

         (1) Property Insurance. Landlord agrees to maintain property insurance
         insuring the Building against damage or destruction due to risk
         including fire, vandalism, and malicious mischief in an amount not less
         than the replacement cost thereof, in the form and with deductibles and
         endorsements as selected by Landlord. At its election, Landlord may
         instead (but shall have no obligation to) obtain "All Risk" coverage,
         and may also obtain earthquake, pollution, and/or flood insurance in
         amounts selected by Landlord.

         (2) Optional Insurance. Landlord, at Landlord's option, may also (but
         shall have no obligation to) carry insurance against loss of rent, in
         an amount equal to the amount of Base Rent and Additional Rent that
         Landlord could be required to abate to all Building tenants in the
         event of condemnation or casualty damage for a period of twelve (12)
         months. Landlord may also (but shall have no obligation to ) carry such
         other insurance as Landlord may deem prudent or advisable, including,
         without limitation, liability insurance in such amounts and on such
         terms as Landlord shall determine. Landlord shall not be obligated to
         insure, and shall have no responsibility whatsoever for any damage to,
         any furniture, machinery, goods, inventory or



                                       10
<PAGE>

         supplies, or other personal property or fixtures which Tenant may keep
         or maintain in the Premises, or any leasehold improvements, additions
         or alterations within the Premises.

B.       Tenant's Insurance.

         (1) Property Insurance. Tenant shall procure at Tenant's sole cost and
         expense and keep in effect from the date of this Lease and at all times
         until the end of the Term, insurance on all personal property and
         fixtures of Tenant and all improvements, additions or alterations made
         by or for Tenant to the Premises on an "All Risk" basis, insuring such
         property for the full replacement value of such property.
         Notwithstanding anything to the contrary contained in this Paragraph
         8B(1), prior to or upon occupancy of the Premises by Tenant, Tenant
         shall purchase form Landlord, for a value of $1.00, all above-standard
         tenant improvements including, but not limited to, clean rooms, all
         HVAC, all electrical, and all plumbing equipment servicing said clean
         rooms, safety showers, and change rooms located on the Premises. Upon
         the expiration or earlier termination of this Lease, Tenant shall
         either (i) return to Landlord said above-standard tenant improvements
         in their then existing condition; or (ii) remove said above-standard
         tenant improvements at Landlord's sole discretion upon surrender of the
         Premises pursuant to Paragraph 36 of this Lease. In exchange for said
         transfer by Landlord to Tenant of said above-standard tenant
         improvements, Tenant shall procure and maintain at all times during the
         term of this Lease adequate property insurance for the full replacement
         value of such above-standard tenant improvements, including replacement
         of said above-standard improvements in the event of Casualty Damage as
         described in Paragraph 24 of this Lease.

         (2) Liability Insurance. Tenant shall procure at Tenant's sole cost and
         expense and keep in effect from the date of this Lease and at all times
         until the end of the Term Commercial General Liability insurance
         covering bodily injury and property damage liability occurring in or
         about the Premises or arising out of the use and occupancy of the
         Premises and the Project, and any part of either, and any areas
         adjacent thereto, and the business operated by Tenant or by any other
         occupant of the Premises. Such insurance shall include contractual
         liability coverage insuring all of Tenant's indemnity obligations under
         this Lease. Such coverage shall have a minimum combined single limit of
         liability of at least Two Million Dollars ($2,000,000.00) and a minimum
         general aggregate limit of Three Million Dollars ($3,000,000.00), with
         an "additional Insured - Managers or Lessors of Premises Endorsement"
         and the "Amendment of the Pollution Exclusion Endorsement." All such
         policies shall be written to apply to all bodily injury (including
         death), property damage or loss, personal and advertising injury and
         other covered loss, however occasioned, occurring during the policy
         term, shall be endorsed to add Landlord and any party holding an
         interest to which this Lease may be subordinated as an additional
         insured, and shall provided that such coverage shall be "primary" and
         non-contributing with any insurance maintained by Landlord, which shall
         be excess insurance only. Such coverage shall also contain endorsements
         including employees as additional insureds if not covered by Tenant's
         Commercial General Liability Insurance. All such insurance shall
         provide for the severability of interests of insureds; and shall be
         written on an "occurrence" basis, which shall afford coverage for all
         claims based on acts, omissions, injury and damage, which occurred or
         arose (or the onset of which occurred or arose) in whole or in part
         during the policy period.

         (3) Workers' Compensation and Employers' Liability Insurance. Tenant
         shall carry Workers' Compensation Insurance as required by any
         Regulation, throughout the Term at Tenant's sole cost and expense.
         Tenant shall also carry Employers' Liability Insurance in amounts not
         less than One Million Dollars ($1,000,000) each accident for bodily
         injury by accident; One Million Dollars ($1,000,000) policy limit for
         bodily injury by disease; and One Million Dollars ($1,000,000) each
         employee for bodily injury by disease, throughout the Term at Tenant's
         sole cost and expense.

         (4) Commercial Auto Liability Insurance. Tenant shall procure at
         Tenant's sole cost and expense and keep in effect from the date of this
         Lease and at all times until the end of the Term commercial auto
         liability insurance with a combined limit of not less than One Million
         Dollars


                                       11
<PAGE>

         ($1,000,000) for bodily injury and property damage for each accident.
         Such insurance shall cover liability relating to any auto (including
         owned, hired and non-owned autos).

         (5) General Insurance Requirements. All coverages described in this
         Paragraph 8.B shall be endorsed to (I) provide Landlord with thirty
         (30) days' notice of cancellation or change in terms; and (ii) waive
         all rights or subrogation by the insurance carrier against Landlord. If
         at any time during the Term the amount or coverage of insurance which
         Tenant is required to carry under this Paragraph 8.B is, in Landlord's
         reasonable judgment, materially less than the amount or type of
         insurance coverage typically carried by owners or tenants of properties
         located in the general area in which the Premises are located which are
         similar to and operated for similar purposes as the Premises or if
         Tenant's use of the Premises should change with or without Landlord's
         consent. Landlord shall have the right to require Tenant to increase
         the amount or change the types of insurance coverage required under
         this Paragraph 8.B. All insurance policies required to be carried by
         Tenant under this Lease shall be written by companies rate A X or
         better in "Best's Insurance Guide" and authorized to do business in the
         State of Oregon. In any event deductible amounts under all insurance
         policies required to be carried by Tenant under this Lease shall not
         exceed Five Thousand Dollars ($5,000.00) per occurrence. Tenant shall
         deliver to Landlord on or before the Term Commencement Date, and
         thereafter at least thirty (30) days before the expiration dates of the
         expired policies, certified copies of Tenant's insurance policies, or a
         certificate evidencing the same issued by the insurer thereunder; and,
         if Tenant shall fail to procure such insurance, or to deliver such
         policies or certificates, Landlord may, Landlord's option and in
         addition to Landlord's other remedies in the event of a default by
         Tenant hereunder, procure the same for the account of Tenant, and the
         cost thereof shall be paid to Landlord as Additional Rent.

C. Indemnification. Tenant shall indemnify, defend by counsel reasonably
acceptable to Landlord, protect and hold Landlord harmless from and against any
and all claims, liabilities, losses, costs, loss of rents, liens, damages,
injuries or expenses, including reasonable attorneys' and consultants' fees and
court costs, demands, causes of action, or judgments, directly or indirectly
arising out of or related to: (1) claims of injury to or death of persons or
damage to property occurring or resulting directly or indirectly from the use of
occupancy of the Premises, Building or Project by Tenant or Tenant's Parties, or
from activities or failures to act of Tenant or Tenant's parties; (2) claims
arising from work or labor performed, or for materials or supplies furnished to
or at the request of Tenant in connection with performance of any work done for
the account of Tenant within the Premises or Project; (3) claims arising from
any breach or default on the part of Tenant in the performance of any covenant
contained in this Lease; and (4) claims arising from the gross negligence or
intentional acts or omissions of Tenant or Tenant's Parties. The foregoing
indemnity by Tenant shall not be applicable to claims to the extent arising from
the gross negligence or willful misconduct of Landlord. Landlord shall not be
liable to Tenant and Tenant hereby waives all claims against Landlord for any
injury or damage to any person or property in or about the Premises, Building or
Project by or from any cause whatsoever (other than Landlord's gross negligence
or willful misconduct ) and, without limiting the generality of the foregoing,
whether caused by water leakage of any character from the roof, walls, basement
or other portion of the Premises, Building or Project, or caused by gas, fire,
oil or electricity in, on or about the Premises, Building or Project. Landlord
shall indemnify, defend by counsel reasonably acceptable to Tenant, protect and
hold Tenant harmless from and against any and all claims, liabilities, losses,
costs, damages, injuries or expenses, including reasonable attorneys' and
consultants' fees and court costs, demands, causes of action, or judgments
arising out of or relating tot he gross negligence or willful misconduct or
Landlord or Landlord's agents, employees or invitees. Notwithstanding the
foregoing or anything to the contrary contained in this Lease, Landlord shall in
no event be liable to Tenant and Tenant hereby waives all claims against
Landlord for any injury or damage to any person or property in or about the
Premises, Building, or Project, including without limitation the common areas,
whether caused by theft, fire, rain or water leakage of any character from the
roof, walls, plumbing, sprinklers, pipes, basement or any other portion of the
Premises, Building or Project, or caused by gas, fire, oil or electricity in, on
or about the Premises, Building or Project, or from any other systems except in
each case to the extent caused by the gross negligence or willful misconduct of
Landlord, or by acts of God (including without limitation flood or earthquake),
acts of a public enemy, riot, strike, insurrection, war, court order,
requisition, or order of governmental body or authority or from any other cause
whatsoever, or for any damage or inconvenience which may arise through repair,
subject to and


                                       12
<PAGE>

except as expressly otherwise provided in Paragraph 9 or 10 of this Lease
(except to the extent caused directly by the gross negligence or willful
misconduct of the Landlord). In addition, Landlord shall in no event be liable
for (I) injury to Tenant's business or any loss of income or profit therefrom or
from consequential damages, or (ii) sums up to the amount of insurance proceeds
received by Tenant. The foregoing indemnity of Landlord shall not be applicable
to claims to the extent arising from the gross negligence or willful misconduct
of Tenant or Tenant's Parties. The foregoing indemnity by Landlord shall survive
the expiration or earlier termination of this Lease. The provisions of this
Paragraph shall survive the expiration or earlier termination of this Lease.

                            9. WAIVER OF SUBROGATION

         To the extent permitted by law and without affecting the coverage
provided by insurance to be maintained hereunder or any other rights or
remedies, Landlord and Tenant each waive any right to recover against the other
for: (a) damages for injury to or death of persons; (b) damages to property,
including personal property; (c) damages to the Premises or any part thereof,
and (d) claims arising by reason of the foregoing due to hazards covered by
insurance maintained or required to be maintained pursuant to this Lease to the
extent of proceeds recovered therefrom, or proceeds which would have been
recoverable therefrom in the case of the failure of any party to maintain any
insurance coverage required to be maintained by such party pursuant to this
Lease. This provision is intended to waive fully, any rights and/or claims
arising by reason of the foregoing, but only to the extent that any of the
foregoing damages and/or claims referred to above are covered or would be
covered, and only to the extent of such coverage, by insurance actually carried
or required to be maintained pursuant to this Lease by either Landlord or
Tenant. This provision is also intended to waive fully, and for the benefit of
each party, any rights and/or claims which might give rise to a right of
subrogation on any insurance carrier. Subject to all qualifications of this
Paragraph 9, Landlord waives its rights as specified in this Paragraph 9 with
respect to any subtenant that it has approved pursuant to Paragraph 21 but only
in exchange for the written waiver of such rights to be given by such subtenant
to Landlord upon such subtenant taking possession of the Premises or a portion
thereof. Each party shall cause each insurance policy obtained by it to provide
that the insurance company waives all right of recovery by way of subrogation
against either party in connection with any damage covered by any policy.

                     10. LANDLORD'S REPAIRS AND MAINTENANCE

         Landlord shall at Landlord's expense maintain in good repair,
reasonable wear and tear excepted, the structural soundness of the roof,
foundations, and exterior walls of the Building. The term "exterior walls" as
used herein shall not include windows, glass or plate glass doors, dock bumpers
or dock plates, special store fronts or office entries. Any damage caused by or
repairs necessitated by any negligence or act of Tenant or Tenant's Parties may
be repaired by Landlord at Landlord's option and Tenant's expense. Tenant shall
immediately give Landlord written notice of any defect or need or repairs in
such components of the Building for which Landlord is responsible, after which
Landlord shall have a reasonable opportunity and the right to enter the Premises
at all reasonable times to repair same; and Landlord agrees that if Landlord
does not commence any Landlord repair within fourteen (14) days after a written
request from Tenant to Landlord to conduct such repair and thereafter diligently
pursue such repair, Tenant shall have the right upon five (5) days' written
notice to commence such repair and bill Landlord for the cost thereof; provided
that if Landlord disputes the need for such repair, within fourteen (14) days
after the date of Tenant's written request, Tenant shall not have the right to
make such a repair; provided further, if any emergency situation exists in which
a Landlord repair must be commenced immediately to avoid material damage to a
material portion of Tenant's Personal Property or Equipment and Landlord does
not commence such repair within three (3) days of written notice from Tenant of
the need for such repair, Tenant shall have the right to commence such repair
and bill Landlord for the cost thereof. Landlord shall reimburse Tenant for said
repairs within twenty (20) days of receipt of a bill from Tenant. Landlord's
liability with respect to any defects, repairs, or maintenance for which
Landlord is responsible under any of the provisions of this Lease shall be
limited to the cost of such repairs or maintenance, and there shall be no
abatement of rent and no liability of Landlord by reason of any injury to or
interference with Tenant's business arising from the making of repairs,
alterations or improvements in or to any portion of the Premises, the Building
or the Project or to fixtures, appurtenances or equipments in the Building,
except as



                                       13
<PAGE>

provided in Paragraph 24. By taking possession of the Premises, Tenant
accepts them "as is," as being in good order, condition and repair and the
condition in which Landlord is obligated to deliver them and suitable for the
Permitted Use and Tenant's intended operations in the Premises, whether or not
any notice of acceptable is given.

                      11. TENANT'S REPAIRS AND MAINTENANCE

         Tenant shall at all times during the Term at Tenant's expense, and
subject to normal wear and tear, maintain all parts of the Premises and such
portions of the Building as are within the exclusive control of Tenant in a
first-class, good, clean and secure condition and promptly make all necessary
repairs and replacements, as determined by Landlord, including but not limited
to, all windows, glass, doors, walls, including demising walls, and wall
finishes, floors and floor covering, heating, ventilating and air conditioning
systems, ceiling insulation, truck doors, hardware, dock bumpers, dock plates
and levelers, plumbing work and fixtures, downspouts, entries, skylights, smoke
hatches, roof vents, electrical and lighting systems, and fire sprinklers, with
materials and workmanship of the same character, kind and quality as the
original. Tenant shall at Tenant's expense also perform regular removal of trash
and debris. If Tenant uses rail and if required by the railroad company, Tenant
agrees to sign a joint maintenance agreement governing the use of the rail spur,
if any. Tenant shall, at Tenant's own expense, enter into a regularly scheduled
preventative maintenance/service contract with a maintenance contractor for
servicing all hot water, hearing and air conditioning systems and equipment
within or serving the Premises. The maintenance contractor and the contract must
be approved by Landlord. The service contract must include all services
suggested by the equipment manufacturer within the operation/maintenance manual
and must become effective and a copy thereof delivered to Landlord within (30)
days after the Term Commencement Date. Landlord may, upon notice to Tenant,
enter into such a service contract on behalf of Tenant or perform the work and
in either case charge Tenant the cost thereof along with a reasonable amount for
Landlord's overhead. Notwithstanding anything to the contrary contained herein,
Tenant shall, at its expense, promptly repair any damage to the Premises or the
Building or Project resulting from or caused by any negligence or act of Tenant
or Tenant's Parties to the extent that insurance proceeds are unavailable or
insufficient to pay for such repairs. Nothing herein shall expressly or by
implication render Tenant Landlord's agent or contractor to effect any repairs
or maintenance required of Tenant under this Paragraph 11, as to all of which
Tenant shall be solely responsible.

                                 12. ALTERATIONS

A. Tenant shall not make, or allow to be made, any alterations, physical
additions, improvements or partitions, including without limitation the
attachment of any fixtures or equipment, in, about or to be Premises
("Alterations") without obtaining the prior written consent of Landlord, which
consent shall not be unreasonable withheld with respect to proposed Alterations
which: (a) comply with all applicable Regulations; (b) are, in Landlord's
opinion, compatible with the Building or the Project and its mechanical,
plumbing, electrical, hearing/ventilation/air conditioning systems, and will not
cause the Building or Project or such systems to be required to be modified to
comply with any Regulations (including, without limitation, the Americans with
Disabilities Act); and (c) will not interfere with the use and occupancy of any
other portion of the Building or Project by any other tenant or its invitees.
Specifically, but without limiting the generality of the foregoing, Landlord
shall have the right of written consent, which shall not be unreasonably
withheld, conditioned, or delayed, for all plans and specifications for the
proposed Alterations, construction means and methods, all appropriate permits
and licenses, any contractor or subcontractor to be employed on the work of
Alterations, and the time for performance of such work, and may impose rules and
regulations for contractors and subcontractors performing such work. Landlord's
consent to Tenant's contractor and subcontractor, will not be unreasonably
withheld. Notwithstanding the foregoing, Tenant shall have the right, without
consent, but upon at least ten (10) business days' prior written notice (as
provided under Paragraph 12.B below) to Landlord, to make non-structural.
Alterations within the interior of the Premises (and which are not visible from
the outside of the Premises), which do not impair the value of the Building, and
which cost, in the aggregate, less than Ten Thousand Dollars ($10,000.00) in any
twelve (12) month period during the Term of this Lease, and except for subtenant
tenant improvements which cost, in the aggregate, less than Ten Thousand Dollars
($10,000.00) and that are non-structural, that may be required after the time
period of December 31, 2000, provided that such


                                       14
<PAGE>


Alterations shall nevertheless be subject to all of the remaining requirements
of this Paragraph 12, including without limitation, subparagraph (a) through (c)
above, other than the requirement of Landlord's prior consent. In addition all
Alterations shall be performed by duly licensed contractors or subcontractors
reasonable acceptable to Landlord, proof of insurance shall be submitted to
Landlord as required under Paragraph 8.B above, and Landlord reserves the right
to impose reasonable rules and regulations for contractors and subcontractors.
Landlord's consent to Tenant's contractor and subcontractor will not be
unreasonable withheld. Tenant shall, if requested by Landlord, promptly furnish
Landlord with complete as-built plans and specifications for any Alterations
performed by Tenant to the Premises, at Tenant's sole cost and expense. Tenant
shall also supply to Landlord any documents and information reasonable request
by Landlord in connection with Landlord's consideration of a request for
approval hereunder. Tenant shall cause all Alterations to be accomplished in a
first-class, good and workmanlike manner, and to comply with all applicable
Regulations and Paragraph 27 hereof. Tenant shall at Tenant's sole expense,
perform any additional work required under applicable Regulations due to the
Alterations hereunder. No review or consent by Landlord of or to any proposed
Alteration or additional work shall constitute a waiver of Tenant's obligations
under this Paragraph 12. Tenant shall reimburse Landlord for all costs which
Landlord may incur in connection with granting approval to Tenant for any such
Alterations, including any costs or expenses which Landlord may incur in
electing to have outside architects and engineers review said plans and
specifications and shall pay Landlord an administration fee five percent (5%) of
the cost of the Alterations as Additional Rent hereunder. All such Alterations
shall remain the property of Tenant until the expiration or earlier termination
of this Lease, at which time they shall be and become the property of Landlord;
provided, however, that Landlord may, at Landlord's option, required that
Tenant, at Tenant's expense, remove any or all Alterations made by Tenant and
restore the Premises by the expiration or earlier termination of this Lease, to
their condition existing prior to the construction of any such Alterations;
provided further, that Landlord shall, at the time Landlord approves each
Alteration, advise Tenant as to whether Landlord will required such Alteration
to be removed upon the expiration or early termination of this Lease. All such
removals and restoration shall be accomplished in a first-class and good and
workmanlike manner so as not to cause any damage to the Premises or Project
whatsoever. If Tenant fails to remove such Alterations or Tenant" trade fixtures
or furniture or other personal property, Landlord may keep and use them or
remove any of them and cause them to be stored or sold in accordance with
applicable law, at Tenant's sole expense. In addition to and wholly apart from
Tenant's obligation to pay Tenant's Proportionate Share of Operating Expenses,
Tenant shall be responsible for and shall pay prior to delinquency any taxes or
governmental service fees, possessory interest taxes, fees or charges in lieu of
any such taxes, capital levies, or other charges imposed upon, levied with
respect to or assessed against its fixtures or personal property, on the value
of Alterations within the Premises, and on Tenant's interest pursuant to this
Lease, or any increase in any of the foregoing based on such Alterations. To the
extent that any such taxes are not separately assessed or billed to Tenant,
Tenant shall pay the amount thereof as invoiced to Tenant by Landlord.

         At Landlord's reasonable election and provided Landlord has notified
Tenant along with its approval of said alterations, Tenant shall pay to Landlord
the cost of removing any such Alterations and restoring the Premises to their
original condition and such amount may be deducted from the Security Deposit or
any other sums or amounts held by Landlord under this Lease.

B. In compliance with Paragraph 27 hereof, at least ten (10) business days
before beginning construction of any Alteration, Tenant shall give Landlord
written notice of the expected commencement date of that construction to permit
Landlord to post and record a notice of non-responsibility. Upon substantial
completion of construction, if the law so provides, Tenant shall cause a timely
notice of completion to be recorded in the office of the recorder of the county
in which the Building is located.

C. Notwithstanding anything to the contrary contained in Paragraph 12.A, at the
time Landlord gives its consent for any Alterations after the initial tenant
improvements, Tenant shall also be notified whether or not Landlord will require
that such Alterations be removed upon the expiration or earlier termination of
this Lease. If Landlord fails to so notify Tenant, it shall be assumed that
Landlord will required their removal.

                                    13. SIGNS



                                       15
<PAGE>

Tenant shall not place, install, paint or maintain any signs, notices, graphics
or banners whatsoever or any window decor which is visible in or from public
view or corridors, the common areas or the exterior of the Premises or the
Building, in or on any exterior window or window fronting upon any common areas
or service area or upon any truck doors or man doors without Landlord's prior
written approval which Landlord shall have the right to withhold in its absolute
and sole discretion; provided that Tenant's name shall be included in any
Building-standard door and director signage, if any, in accordance with
Landlord's Building signage program, including without limitation, payment by
Tenant of any fee charged by Landlord for maintaining such signage, which, fee
shall constitute Additional Rent hereunder. Any installation of signs, notices,
graphics or banners on or about the Premises or Project approved by Landlord
shall be subject to any Regulations and to any other requirements imposed by
Landlord. Tenant shall remove all such signs or graphics by the expiration or
any earlier termination of this Lease. Such installations and removals shall be
made in such manner as to avoid injury to or defacement of the Premises,
Building or Project and nay other improvements contained therein, and Tenant
shall repair any injury or defacement including without limitation discoloration
caused by such installation or removal. Notwithstanding the foregoing, Tenant
shall have the exclusive right to place on-building signage at Tenant's expense
at two locations on the Building. Landlord and Tenant agree to work together to
ensure all signage is professional and of a first-class nature. However, all
signage shall require Landlord's written approval as to size, location, design
and content, which approval shall not be unreasonable withheld, delayed or
conditioned.

                         14. INSPECTION/POSTING NOTICES

After reasonable notice, except in emergencies where no such notice shall be
required, Landlord and Landlord's agents and which shall be accompanied by a
Tenant representatives, shall have the right to enter the Premises to inspect
the same, to clean, to perform such work as may be permitted or required
hereunder, to make repairs, improvements or alterations to the Premises,
Building or Project or to other tenant spaces therein, to deal with emergencies,
to post such notices as may be permitted or required by law to prevent the
perfection of liens against Landlord's interest in the Project or to exhibit the
Premises to prospective tenants, purchasers, encumbrances or others, or for any
other purposes as Landlord may deem necessary or desirable; provided, however,
that Landlord shall use reasonable efforts not to unreasonable interfere with
Tenant's business operations. Tenant shall not be entitled to any abatement of
Rent by reason of the exercise of any such right of entry. Tenant waives any
claim for damages for any injury or inconvenience to or interference with
Tenant's business, any loss of occupancy or quiet enjoyment of the Premises, and
any other loss occasioned thereby. Landlord shall at all times have and retain a
key with which to unlock all of the doors in, upon and about the Premises,
excluding Tenant's vaults and safes or special security areas (designated in
advance), and Landlord shall have the right to use any and all means which
Landlord may deem necessary or proper to open said doors in an emergency, in
order to obtain entry to any portion of the Premises, and any entry to the
Premises or portions thereof obtained by Landlord by any of said means, or
otherwise, shall not be construed to be a forcible or unlawful entry into, or a
detainer of, the Premises, or an eviction, actual or constructive, of Tenant
from the Premises or any portions thereof. At any time within six (6) months
prior to the expiration of the Term or following any earlier termination of this
Lease or agreement to terminate this Lease, Landlord shall have the right to
erect on the Premises, Building and/or Project a suitable sign indicating that
the Premises are available for lease. Landlord and it's agents shall maintain
confidentiality with regards to Tenant trade secrets or other confidential
material they may observe in the course of any inspection.

                           15. SERVICES AND UTILITIES

A. Tenant shall pay directly for all water, gas, heat, air conditioning, light,
power, telephone, sewer, sprinkler charges and other utilities and services used
on or from the Premises, together with any taxes, penalties, surcharges or the
like pertaining thereto, and maintenance charges for utilities and shall furnish
all electric light bulbs, ballasts and tubes. If any such services are not
separately billed or metered to Tenant, Tenant shall pay a proportion, as
determined by Landlord, of all charges jointly serving other premises. All sums
payable under this Paragraph 15 shall constitute Additional Rent hereunder.





                                       16
<PAGE>

B. Tenant acknowledges that Tenant has inspected and accepts the water,
electricity, heat and air conditioning and other utilities and services being
supplied or furnished to the Premises as of the date Tenant takes possession of
the Premises, if any, as being sufficient in their present condition, "as is,"
for the Permitted Use, and for Tenant's intended operations in the Premises.
Tenant agrees to keep and cause to be kept closed all window covering when
necessary because of the sun's position, and Tenant also agrees at all times to
cooperate fully with Landlord and to abide by all of the regulations and
requirements which Landlord may prescribe for the proper functioning and
protection of electrical, heating, ventilating and air conditioning systems.

C. Landlord shall not be liable for any damages directly or indirectly resulting
from nor shall the Rent or any monies owed Landlord under this Lease herein
reserved be abated by reason of: (a) the installation, use or interruption of
use of any equipment used in connection with the furnishing of any such
utilities or services, or any change in the character or means of supplying or
providing any such utilities or services or any supplier thereof; (b) the
failure to furnish or delay in furnishing any such utilities or services when
such failure or delays caused by acts of God or the elements, labor disturbances
of any character, or any other accidents or other conditions beyond the
reasonable control of Landlord or because of any interruption of service due to
Tenant's use of water, electric current or other resource in excess of that
being supplied or furnished for the use of the Premises as of the date Tenant
takes possession of the Premises; or (c) the inadequacy, limitation,
curtailment, rationing or restriction on use of water, electricity, gas or any
other form of energy or any other service or utility whatsoever serving the
Premises or Project otherwise, or (d) the partial or total unavailability of any
such utilities or services to the Premises or the Building, whether by
Regulation or otherwise; nor shall any such occurrence constitute an actual or
construction eviction of Tenant. Landlord shall further have no obligation to
protect or preserve any apparatus, equipment or device installed by Tenant in
the Premises, including without limitation by providing additional or
after-hours heating or air conditioning. Landlord shall be entitled to cooperate
voluntarily and in a reasonable manner with the efforts of national, state or
local governmental agencies or utility suppliers in reducing energy or other
resource consumption. The obligation to make services available hereunder shall
be subject to the limitations of any such voluntary, reasonable program. In
addition, Landlord reserves the right to change the supplier or provider of any
such utility or service from time to time.

D. Notwithstanding anything to the contrary contained in this Lease, in the
event of interruption of any services or utilities necessary for the conduct of
Tenant's primary business, Landlord shall make reasonable efforts to restore
such services or utilities. If the failure or interruption of an essential
service or utility (i) is the result of the gross negligence of Landlord or its
agents, and (ii) repair of such interruption is within Landlord's reasonable
control, and (iii) continues to substantially interfere with the conduct of
Tenant's business in the Premises for more than five (5) days after notice of
such interruption or failure shall have been given to Landlord, the Base Rent to
be paid under this Lease shall be abated to such an extent as is fair and
reasonable under the circumstances based on the degree of interference from the
date of Tenant's notice to Landlord of such interruption until such service or
utility is restored. If the failure or interruption of an essential service or
utility (i.) is not due to a fire or other casualty or to any act, neglect or
omission of Tenant or any of the Tenant's Parties, and (ii) its cure is beyond
the reasonable control of Landlord and (iii) continues and substantially
interferes with the conduct of Tenant's business in the Premises for more than
fifteen (15) business days after notice of such interruption or failure shall
have been given to Landlord, then the Bas Rent to be paid under this Lease shall
be abated to such an extent as is fair and reasonable under the circumstances
based on the degree of interference from the date of Tenant's notice to Landlord
of such interruption until such service or utility is restored. If the failure
or interruption of an essential service or utility (i.) is the result of the
gross negligence of the Landlord or its agents, and (ii) repair of such
interruption is within Landlord's reasonable control, and (iii) continues or
substantially interferes with the conduct of Tenant's business in the Premises
for more than ninety (90) days after notice of such interruption or failure
shall have been given to Landlord, then Tenant shall have the option to
terminate this Lease upon written notice to Landlord of its election to
terminate the Lease, which notice must be given to Landlord no later than ten
(10) days following the end of such ninety (90) day period.

                                16. SUBORDINATION


                                       17
<PAGE>


Without the necessity of any additional document being executed by Tenant for
the purpose of effecting a subordination, this Lease shall be and is hereby
declared to be subject and subordinate at all times to: (a) all ground leases or
underlying lease which may now exist or hereafter be executed affecting the
Premises and/or the land upon which the Premises and Project are situated, or
both; and (b) any mortgage or deed of trust which may now exist or be placed
upon the Building, the Project and/or the land upon which the Premises or the
Project are situated, or said ground leases or underlying leases, or Landlord's
interest or estate in any of said items which is specified as security.
Notwithstanding the foregoing, Landlord shall have the right to subordinate or
cause to be subordinated any such ground leases or underlying leases or any such
liens to this Lease. If any ground lease or underlying lease terminates for any
reason or any mortgage or deed of trust is foreclosed or a conveyance in lieu of
foreclosure is made for any reason, Tenant shall, notwithstanding any
subordination, attorn to and become the Tenant of the successor in interest to
Landlord provided that Tenant shall not be disturbed in it possession under this
Lease by such successor in interest so long as Tenant is not in default under
this Lease. Within ten (10) days after request by Landlord, Tenant shall execute
and deliver any additional documents evidencing Tenant's attornment or the
subordination of this Lease with respect to any such ground leases or underlying
leases or any such mortgage or deed of trust, in the form request by Landlord or
by any ground landlord, mortgagee, or beneficiary under a deed of trust, subject
to such nondisturbance requirement. If requested in writing by Tenant, Landlord
shall use commercially reasonable efforts to obtain a subordination,
nondisturbance and attornment agreement for the benefit of Tenant, Landlord
shall use commercially reasonable efforts to obtain a subordination,
nondisturbance and attornment agreement for the benefit of Tenant reflecting the
foregoing from any current or future ground landlord, mortgagee or beneficiary,
subject to such other terms and conditions as the ground landlord, mortgagee or
beneficiary may require. In the event this Lease or the leasehold estate created
hereunder is subject to the prior rights of any mortgagee or ground lessor, then
Landlord shall secure from such mortgagee or ground lessor an agreement in
writing whereby Tenant, so long as Tenant is not in default hereunder, may
remain in possession of the Premises pursuant to the terms hereof and without
any diminution of Tenant's rights should Landlord become in default with respect
to such mortgage or ground lease or should the Premises become the subject of
any action to foreclose any mortgage or to dispossess Landlord. Such agreement
shall be secured and furnished to Tenant within sixty (60) days following the
Term Commencement Date as defined herein.

Such agreement would provide, among other things, that the new owner following
any foreclosure, sale or conveyance shall not be (i) liable for any act or
omission of any prior landlord or with respect to events occurring prior to
acquisition of ownership; (ii) subject to any offsets or defenses which Tenant
might have against any prior landlord; (iii) bound by prepayment of more than
one (1) month's Rent; or (iv) liable to Tenant for any security deposit not
actually received by such new owner. Each ground landlord, mortgagee, or
beneficiary under a deed of trust shall be an express third party beneficiary of
the provisions of this Paragraph 16 and any other provisions of this Lease that
are for the benefit of such party.

                            17. FINANCIAL STATEMENTS

         At the reasonable request of Landlord from time to time, Tenant shall
provide to Landlord Tenant's and any guarantor's current financial statements or
other information discussing financial worth of Tenant and any guarantor, which
Landlord shall use solely for purposes of this Lease and in connection with the
ownership, management, financing and disposition of the Project, and which
Landlord shall keep confidential.

                            18. ESTOPPEL CERTIFICATE

Tenant agrees from time to time, within ten (10) days after request of Landlord,
to deliver to Landlord, or Landlord's designee, an estoppel certificate stating
that this Lease is in full force and effect, that this Lease has not been
modified (or stating all modifications, written or oral, to this Lease), the
date to which Rent has been paid, the unexpired portion of this Lease, that
there are no current defaults bv Landlord or Tenant under this Lease (or
specifying any such defaults), that the leasehold estate granted by this Lease
is the sole interest of Tenant in the Premises and/or the land at which the
Premises are situated, and such other matters pertaining to this Lease as may be
reasonable request by Landlord or any mortgagee, beneficiary, purchaser or
prospective purchaser of the Building or Project or any interest therein.
Failure by Tenant to execute and


                                       18
<PAGE>


deliver such certificate shall constitute an acceptance of the Premises and
acknowledgment by Tenant that the statements included are true and correct
without exception. Tenant agrees that if Tenant fails to execute and deliver
such certificate within such ten (10) day period, Landlord may execute and
deliver such certificate on Tenant's behalf and that such certificate shall be
binding on Tenant. Landlord and Tenant intend that any statement delivered
pursuant to this Paragraph may be relied upon by any mortgagee, beneficiary,
purchaser or prospective purchaser of the Building or Project or any interest
therein. The parties agree that Tenant's obligation to furnish such estoppel
certificates in a timely fashion is a material inducement for Landlord's
execution of this Lease, and shall be an event of default (without any cure
period that might be provided under Paragraph 26.A(3) of this Lease) if Tenant
fails to fully comply or makes any material misstatement in any such
certificate.

                              19. SECURITY DEPOSIT

         Tenant agrees to deposit with Landlord upon execution of this Lease, a
security deposit as stated in the Basic Lease Information (the "Security
Deposit"), which sum shall be held and owned by Landlord, without obligation to
pay interest, as security for the performance of Tenant's covenants and
obligations under this Lease. The Security Deposit is not an advance rental
deposit or a measure of damages incurred by Landlord in case of Tenant's
default. Upon the occurrence of any event of default by Tenant, Landlord may
from time to time, without prejudice to any other remedy provided herein or by
the law, use such fund as a credit to the extent necessary to credit against any
arrears of Rent or other payments due to Landlord hereunder, and any other
damage, injury, expense or liability caused by such event of default, and Tenant
shall pay to Landlord, on demand, the amount so applied in order to restore the
Security Deposit to its original amount. Although the Security Deposit shall be
deemed the property of Landlord, any remaining balance of such deposit shall be
returned by Landlord to Tenant at such time after termination of this Lease that
all of Tenant's obligations under this Lease have been fulfilled, reduced by
such amounts as may be required by Landlord to remedy defaults on the part of
Tenant in the payment of Rent or other obligations of Tenant under this Lease,
to repair damage to the Premises, Building or Project caused by Tenant or any
Tenant's Parties and to clean the Premises. Landlord may use and commingle the
Security Deposit with other funds of Landlord. Notwithstanding anything to the
contrary contained in this Paragraph 19, in lieu of a Security Deposit Tenant
may provide Landlord with a Letter of Credit pursuant to Paragraph 38 K of this
Lease.

                       20. LIMITATION OF TENANT'S REMEDIES

The obligation and liability of Landlord to Tenant for any default by Landlord
under the terms of this Lease are not personal obligations of Landlord or of the
individual or other partners of Landlord or its or their partners, directors,
officers, or shareholders, and Tenant agrees to look solely to Landlord's
interest in the Project for the recovery of any amount from Landlord, and shall
not look to other assets of Landlord nor seek recourse against the assets of the
individual or other partners of Landlord or its or their partners, directors,
officers or shareholders. Any lien obtained to enforce any such judgement and
any levy of execution thereon shall be subject and subordinate to any lien,
mortgage or deed of trust on the Project. Under no circumstances shall Tenant
have the right to offset against or recoup Rent or other payments due and to
become due to Landlord hereunder except as expressly provided in Paragraph 23.B
below, which Rent and other payments shall be absolutely due and payable
hereunder in accordance with the terms hereof. Notwithstanding anything to the
contrary contained in this Paragraph 20, Tenant shall have available to it all
remedies allowable under Oregon law.

                          21. ASSIGNMENT AND SUBLETTING

A.       (1)      General.  This Lease has been negotiated to be and is granted
         as an accommodation to Tenant. Accordingly, this Lease is personal to
         Tenant, and Tenant's rights granted hereunder do not include the right
         to assign this Lease or sublease the Premises, or to receive any
         excess, either in installments or lump sum, over the Rent which is
         expressly reserved by Landlord as hereinafter provided, except as
         otherwise expressly hereinafter provided. Tenant shall not assign or
         pledge this Lease or sublet the Premises or any part thereof, whether
         voluntarily or by operation of law, or permit the use or occupancy of
         the Premises or any part thereof by anyone other than Tenant, or


                                       19
<PAGE>

         suffer or permit any such assignment, pledge, subleasing or occupancy,
         without Landlord's prior written consent except as provided herein. If
         Tenant desires to assign this Lease or sublet any or all of the
         Premises, Tenant shall give Landlord written notice (the "Transfer
         Notice") at least twenty (20) business days prior to the anticipated
         effective date of the proposed assignment or sublease, which shall
         contain all of the information reasonable requested by Landlord to
         address Landlord's decision criteria specified hereinafter. Landlord
         shall then have a period of ten (10) business days following receipt of
         the Transfer Notice to notify Tenant in Writing that Landlord elects
         either (i) to terminate this Lease as to the space so affected as of
         the so request by Tenant; or (ii) to consent to the proposed assignment
         or sublease, subject, however, to Landlord's prior written consent of
         the proposed assignee or subtenant and of any related documents or
         agreements associated with the assignment or sublease. If Landlord
         should fail to notify Tenant in writing of such election within said
         period, Landlord shall be deemed to have waived option (i) above, but
         written consent by Landlord of the proposed assignee or subtenant shall
         still be required. If Landlord should fail to notify Tenant in writing
         of such election within said period, Landlord shall be deemed to have
         waived option (i) above, but written consent by Landlord of the
         proposed assignee or subtenant shall still be required. If Landlord
         does not exercise option (i) above, Landlord's consent to a proposed
         assignment or sublease shall not be unreasonable withheld. Consent to
         any assignment or subletting shall not constitute consent to any
         subsequent transaction to which this Paragraph 21 applies.
         Notwithstanding the foregoing Tenant shall have the right to sublease
         or assign to affiliates or subsidiaries with Landlord's prior written
         consent, which shall not be unreasonable withheld, delayed or
         conditioned.

         (2) Conditions of Landlord's Consent. Without limiting the other
instances in which it may be reasonable for Landlord to without Landlord's
consent to an assignment or subletting, Landlord and Tenant acknowledge that it
shall be reasonable for Landlord to withhold Landlord's consent in the following
instances: if the proposed assignee does not agree to be bound by and assume the
obligations of Tenant under this Lease in form and substance satisfactory to
Landlord, the use of the Premises by such proposed assignee or subtenant would
not be a Permitted Use or would violate any exclusivity or other arrangement
which Landlord has with any other tenant or occupant or any Regulation; the
assignment or subletting would entail any Alterations which would lessen the
value of the leasehold improvements in the Premises or use of any Hazardous
Materials or other noxious use or use which may disturb other tenants of the
Project, or Tenant is in default of any obligation of Tenant under this Lease,
or Tenant has defaulted under this Lease on three (3) or more occasions during
any twelve (12) months preceding the date that Tenant shall request consent. In
no event, however, shall Tenant or Tenant's agent solicit directly an present
tenants in the Project for purposes of subletting Tenant's space, without
landlord's prior written consent. Failure by or refusal of Landlord to consent
to a proposed assignee or subtenant shall not cause a termination of this Lease.
Upon a termination under paragraph 21.A(1)(i), Landlord may lease the Premises
to any party, including parties with whom Tenant has negotiated an assignment or
sublease, without incurring any liability to Tenant. At the option of Landlord,
a surrender and termination of this Lease shall operate as an assignment to
landlord of some or all subleases or subtenancies. Landlord shall exercise this
option by giving notice of that assignment to such subtenants on or before the
effective date of the surrender and termination. In connection with each request
for assignment or subletting, Tenant shall pay to Landlord Landlord's standard
fee of not to exceed $350.00 per transaction for approving such requests, as
well as all costs incurred by Landlord or any mortgagee or groundlessor in
approving each such requests, as well as all costs incurred by Landlord or any
mortgagee or ground lessor in approving each such request and effecting any such
transfer, including without limitation, reasonable attorney's fees.

B. Bonus Rent. Any Rent or other consideration realized by Tenant under any such
sublease or assignment in excess of the Rent payable hereunder, after
amortization of a reasonable brokerage commission incurred by Tenant, and after
any approval costs and/or any administrative fees paid to Landlord for sublease
Tenant Improvements, and after Tenant has recovered the cost of any tenant
improvements paid for by Tenant and Tenant's other reasonable out of pocket
costs of subleasing or assignment including, without limitation, reasonable
attorneys' fees, shall be divided and paid , fifty percent (50%) to Tenant,
fifty percent (50%) to Landlord. In any subletting or assignment undertaken by
Tenant, Tenant shall diligently seek to obtain the maximum rental amount
available in the marketplace for comparable space available for primary leasing.



                                       20
<PAGE>


C. Corporation. If Tenant is a corporation, a transfer of corporate shares by
sale, assignment, bequest, inheritance, operation of law or other disposition
(including such a transfer to or by a receiver or trustee in federal or state
bankruptcy, insolvency or other proceedings) resulting in a substantial (fifty
percent (50%) of the shares change hands) change in the present control of such
corporation or any of its parent corporations, shall constitute an assignment
for purposes of this Lease. Notwithstanding anything to the contrary in this
Lease, the transfer of outstanding capital stock or other listed equity
interests, or the purchase of outstanding capital stock or other listed equity
interests, or the purchase of equity interests issued in an initial public
offering or stock, by persons or parties other than "insiders" within the
meaning of Securities Exchange Act of 1934, as amended, through the
"over-the-counter" market or any recognized national or international securities
exchange shall not be included in determining whether control has been
transferred.

D. Unincorporated Entity. If Tenant is a partnership, joint venture,
unincorporated limited liability company or other unincorporated business form,
a transfer of the interest of persons, firms or entities responsible for
managerial control of Tenant by sale, assignment, bequest, inheritance,
operation of law or other disposition, so as to result in a change in the
present control of said entity and/or of the underlying beneficial interests of
said entity and/or a change in the identify of the persons responsible for the
general credit obligations of said entity shall constitute an assignment for all
purpose of this Lease.

E. Liability. No assignment or subletting by Tenant permitted or otherwise,
shall relieve Tenant of any obligation under this Lease or alter the primary
liability of the Tenant named herein for the payment of Rent or for the
performance of any other obligations to be performed by Tenant, including
obligations contained in Paragraph 25 with respect to any assignee or subtenant.
Landlord may collect rent or other amounts or any portion thereof from any
assignee, subtenant, or other occupant of the Premises, permitted or otherwise,
and apply the net rent collected to the Rent payable hereunder, but no such
collection shall be deeded to be a waiver of this Paragraph 21, or the
acceptance of the assignee, subtenant or occupant as tenant, or a release of
Tenant from the further performance by Tenant of the obligations of Tenant under
this Lease. Any assignment or subletting which conflicts with the provisions
hereof shall be void.

                                  22. AUTHORITY

Landlord represents and warrants that it has full right and authority to enter
into this Lease and to perform all Landlord's obligations hereunder and that all
persons signing this Lease on its behalf are authorized to do. Tenant and the
person or persons, if any, signing on behalf of Tenant, jointly and severally
represent and warrant that Tenant has full right and authority to enter into
this Lease, and to perform all of Tenant's obligations hereunder, and that all
persons signing this Lease on its behalf are authorized to do so.

                                23. CONDEMNATION

A. Condemnation Resulting in Termination. If the whole or any substantial part
of the Premises should be taken or condemned for any public use under any
Regulations, or by right of eminent domain, or by private purchase in lieu
thereof, and the taking would percent or materially interfere with the Permitted
Use of the Premises, either party shall have the right to terminate this Lease
at its option. If any material portion of the Building or Project is taken or
condemned for any public use under any Regulation or by right of eminent domain,
or by private purchase in lieu thereof, Landlord may terminate this Lease at its
option. In either of such events, the Rent shall be abated during the unexpired
portion of this Lease, effective when the physical taking of said Premises shall
have occurred.

B. Condemnation Not Resulting in Termination. If a portion of the Project of
which the Premises are a part should be taken or condemned for any public use
under any Regulation, or by right of eminent domain, or by private purchase in
lieu thereof, and the taking prevents or materially interferes with the
Permitted Use of the Premises, and this Lease is not terminated as provided in
Paragraph 23.A. above, the Rent payable hereunder during the unexpired portion
of this Lease shall be reduced, beginning on the date when the physical taking
shall have occurred, to such amount as may be fair and reasonable under all of
the circumstances. Notwithstanding anything to the contrary contained in this
Paragraph, if the temporary use or occupancy of any part of the Premises shall
be taken or appropriated under power of eminent domain


                                       21
<PAGE>


during the Term, this Lease shall be and remain unaffected by such taking or
appropriation and Tenant shall continue to pay in full all Rent payable
hereunder by Tenant during the Term; in the event of any such temporary
appropriation or taking, Tenant shall be entitled to receive that portion of any
award which represents compensation for the use of or occupancy of the Premises
during the Term, and Landlord shall be entitled to receive that portion of any
award which represents the cost to Landlord of restoration of the Premises and
the use and occupancy of the Premises.

C. Award. Landlord shall be entitled to (and Tenant shall assign to Landlord)
any and all payment, income, rent, award or any interest therein whatsoever
which may be paid or made in connection with such taking or conveyance and
Tenant shall have no claim against Landlord or otherwise for any sums paid by
virtue of such proceedings whether or not attributable to the value of any
unexpired portion of this Lease, except as expressly provided in this Lease.
Notwithstanding the foregoing, any compensation specifically and separately
awarded Tenant for Tenant's personal property and moving costs, shall be and
remain the property of Tenant.

                               24. CASUALTY DAMAGE

A. General. If the Premises or Building should be damaged or destroyed by fire,
tornado, or other casualty (collectively, "Casualty"), Tenant shall give
immediate written notice thereof to Landlord. Within thirty (30) days after
Landlord's receipt of such notice, Landlord shall notify Tenant whether in
Landlord's estimation material restoration of the Premises can reasonable be
made within one hundred eighty (180) days from the date of such notice and
receipts of required permits for such restoration. Landlord's determination
shall be binding on Tenant.

B. Within 180 Days. If the Premises or Building should be damaged by Casualty to
such extent that material restoration can in Landlord's estimation be reasonably
completed within one hundred eighty (180) days after the date of such notice and
receipt of required permits for such rebuilding or repair, then landlord shall
have the option of either: (1) terminating this Lease effective upon the date of
the occurrence of such damage, in which event the Rent shall be abated during
the unexpired portion of this Lease; or (2) electing to rebuild or repair the
Premises diligently and in the manner determined by Landlord. Landlord shall
notify Tenant of its election within thirty (30) days after Landlord's receipt
of notice of the damage or destruction. Notwithstanding the above, Landlord
shall not be required to rebuild, repair or replace any part of any Alterations
which may have been placed, on or about the Premises by Tenant. If the Premises
are untenantable in whole or in part following such damage, the Rent payable
hereunder during the period in which they are untenantable shall be abated
proportionately, but only to the extent the Premises are unfit for occupancy.

D. Greater than 270 Days. If the Premises or Building should be damaged by
Casualty to such extent that rebuilding or repairs cannot in Landlord's
estimation be reasonable completed within two hundred seventy (270) days after
receipts of required permits for rebuilding or repair, and such damage
materially and adversely interferes with the conduct of Tenant's business in the
Premises, then either party shall have the right to cancel this Lease by giving
the other party written notice within ten (10) days from the date of Landlord's
notice that material restoration of the Premises cannot be made within such two
hundred seventy (270) say period or notice that Landlord has elected not to
rebuild or repair the Premises. Said cancellation shall be effective thirty (30)
days from the first day that either party gives its notice to cancel. If neither
party elects to so cancel this Lease, Landlord shall proceed to rebuild and
repair the Premises diligently and in the manner determined by Landlord, except
that Landlord shall not be required to rebuild, repair or replace any part of
any Alterations which may have been placed on or about the Premises by Tenant.
If the Premises are untenantable in whole or in part following such damage, the
Rent payable hereunder during the period in which they are untenantable shall be
abated proportionately, but only to the extent the Premises are unfit for
occupancy.

E. Casualty to Clean Rooms and Thin Film Rooms. If the clean rooms and thin film
rooms located within the Premises are substantially damaged by Casualty to such
extent that rebuilding or repairs cannot in Landlord and Tenant's mutual
estimation be reasonably completed within ninety (90) days after access to the
Premises has been granted by any governmental authority to safely allow an
inspection of the


                                       22
<PAGE>

Premises, and an inspection conducted jointly by Landlord and Tenant has then
been made, then Tenant shall have the right to cancel this Lease by giving the
Landlord written notice within ten (10) days from the date of Landlord's notice
that material restoration of the Premises cannot be made within such ninety (90)
day period. Said cancellation shall be effective thirty (30) days from the first
day that Tenant gives Landlord its notice to cancel. If Tenant elects to not
cancel this Lease, Landlord shall proceed to rebuild and repair the Premises
diligently and in this manner determined by Landlord, except that Landlord shall
not be required to rebuild, repair or replace any part of any Alterations which
may have been placed on or about the Premises by Tenant. If the Premises are
untenantable in while or in part following such damage, the Rent payable
hereunder during the period in which they are untenantable shall be abated
proportionately, but only to the extent the Premises are unfit for occupancy.

F. Tenant's Fault. Notwithstanding anything herein to the contrary, if the
Premises or any other portion of the Building are damaged by Casualty resulting
from the fault, negligence, or breach of this Lease by Tenant or any of Tenant's
Parties, Base Rent and Additional Rent shall not be diminished during the repair
of such damage and Tenant shall be liable to Landlord for the cost and expense
of the repair and restoration of the building caused thereby to the extent such
cost and expense in not covered by insurance proceeds.

G. Insurance Proceeds. Notwithstanding anything herein to the contrary, if the
Premises or Building are damaged or destroyed and are not fully covered by the
insurance proceeds received by Landlord or if the holder of any indebtedness
secured by a mortgage or deed of trust covering the Premises requires that the
insurance proceeds be applied to such indebtedness, then in either case Landlord
shall have the right to terminate this Lease by delivering written notice of
termination to Tenant within thirty (30) days after the date of notice to
Landlord that said damage or destruction is not fully covered by insurance or
such requirement is made by any such holder, as the case may be, whereupon this
Lease shall terminate.

H. Tenant's Personal Property. In the Event of any damage or destruction of the
Premises or the Building, under no circumstances shall Landlord be required to
repair any injury or damage to, or make any repairs to or replacements of,
Tenant's personal property.

I. Waiver. This Paragraph 24 shall be Tenant's sole and exclusive remedy in the
event of damage or destruction to the Premises or the Building. As a material
inducement to Landlord entering into this Lease, Tenant hereby waives any rights
it may have under any law, statute or ordinance now or hereafter in effect.

                                25. HOLDING OVER

Unless Landlord expressly consents in writing to Tenant's holding over, Tenant
shall be unlawfully and illegally in possession of the Premises, whether or not
Landlord accepts any rent from Tenant or any other person while Tenant remains
in possession of the Premises without Landlord's written consent. If Tenant
shall retain possession of the Premises or any portion thereof without
Landlord's consent following the expiration of this Lease or sooner termination
for any reason, then Tenant shall pay to Landlord an amount for Base Rent equal
to one and one-quarter (1.25) the Base Rent as of the last month prior to the
date of expiration or earlier termination. Tenant shall also indemnify, defend,
protect and hold Landlord harmless from any loss, liability or cost, including
consequential and incidental damages and reasonable attorneys' fees, incurred by
Landlord resulting from delay by Tenant in surrendering the Premises, including,
without limitation, any claims made by the succeeding tenant founded on such
delay. Acceptance of Rent by Landlord following expiration or earlier
termination of this Lease, or following demand by Landlord for possession of the
Premises, shall not constitute a renewal of this Lease, and nothing contained in
this Paragraph 25 shall waive Landlord's right of reentry or any other right.
Additionally, if upon expiration or earlier termination of this Lease, or
following demand by Landlord for possession of the Premises, Tenant has not
fulfilled its obligation with respect to repairs and cleanup of the 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
Paragraph 25 shall apply. The provisions of this Paragraph 25 shall survive any
expiration or earlier termination of this Lease.



                                       23
<PAGE>

                                  26. DEFAULT

A.       Events of Default.  The occurrence of any of the following shall
         constitute an event of default on the part of Tenant:

         (1) Abandonment. Abandonment or vacation of the Premises for a
             continuous period in excess of twenty (20) days, and said
             abandonment occurs in conjunction with unpaid rent.

         (2) Nonpayment of Rent. Tenant shall fail to pay any installment
             of the rent herein reserved when due, or any payment with respect
             to taxes hereunder when due, or any other payment, and such failure
             shall continue for a period of five (5) days from the date such
             payment was due; provided, however, Tenant shall not be in default
             of this Lease the first time in a twelve (12) month period that
             Tenant fails to pay rent when due so long as Tenant pays such
             overdue rent within five (5) days of notice from Landlord that such
             overdue amount is payable.

         (3) Other Obligations. Failure to perform any obligation,
             agreement or covenant under this Lease other than those matters
             specified in subparagraphs (1) and (2) of this Paragraph 26.A.,
             such failure continuing for fifteen (15) days after written notice
             of such failure, as to which time is of the essence; provided,
             however, Tenant shall not be in default of this Lease if such
             failure cannot be cured within such fifteen (15) day period so long
             as Tenant commences such cure within such fifteen (15) day period
             and thereafter diligently pursues such cure, and so long as
             Tenant's delay in curing such failure will not (as determined by
             Landlord in Landlord's business judgment) adversely affect Landlord
             or the Premises.

         (4) General Assignment. A general assignment by Tenant for the benefit
             of creditors.

         (5) Bankruptcy. The filing of any voluntary petition in bankruptcy
             by Tenant, or the filing of an involuntary petition by Tenant's
             creditors, which involuntary petition remains undischarged for a
             period of thirty (30) days. If under applicable law, the trustee in
             bankruptcy or Tenant has the right to affirm this Lease and
             continue to perform the obligations of Tenant hereunder, such
             trustee or Tenant shall, in such time period as may be permitted by
             the bankruptcy court having jurisdiction, cure all defaults of
             Tenant hereunder outstanding as of the date of the affirmance of
             this Lease and provide to Landlord such adequate assurances as may
             be necessary to ensure Landlord of the continued performance of
             Tenant's obligations under this Lease.

         (6) Receivership. The employment of a receiver to take possession
             of substantially all of Tenant's assets or the Premises, if such
             appointment remains undismissed or undischarged for a period of
             fifteen (15) days after the order therefor.

         (7) Attachment. The attachment, execution or other judicial
             seizure of all or substantially all of Tenant's assets for Tenant's
             leasehold of the Premises, if such attachment or other seizure
             remains undismissed or undischarged for a period of fifteen (15)
             days after the levy thereof.

         (8) Insolvency.  The admission by Tenant in writing of its inability
             to pay its debts as they become due.

B.       Remedies Upon Default. Upon the occurrence of any events of default
         described in Paragraph 26.A of this Lease, Landlord shall have the
         option to pursue any one or more of the following



                                       24
<PAGE>

         remedies without any notice or demand whatsoever. Nothing in this
         Paragraph 26.B shall relieve Landlord of any duty to exercise its
         reasonable efforts to mitigate its damages, as required by law.

         (1) Terminate Lease. Terminate this Lease, in which event Tenant
             shall immediately surrender the Premises to Landlord, and if Tenant
             fails to do so, Landlord may, without prejudice to any other remedy
             which Landlord may have for possession or arrearages in rent, enter
             upon and take possession of the Premises and expel or remove Tenant
             and any other person who may be occupying the Premises or any part
             of the Premises, by self-help means, at Landlord's option, without
             being liable for prosecution or any claim of damages therefor, and
             Tenant agrees to pay to Landlord on demand the amount of all loss
             and damage which Landlord may suffer by reason of such termination,
             whether through inability to relet the Premises on satisfactory
             terms or otherwise. Landlord's right to any and all damages and
             remedies shall survive termination of this Lease.

         (2) Recover Possession.  Enter upon and take possession of the Premises
             and expel or remove Tenant and any other person who may be
             occupying the Premises or any part of the Premises, by self-help
             means, at Landlord's option, without being liable for prosecution
             or any claim for damages, and relet the Premises for such terms
             ending before, on or after the expiration date of the Term of this
             Lease, at such rentals and upon such other conditions (including
             concessions and prior occupancy periods) as Landlord in its sole
             discretion may determine, and receive the rent for such reletting;
             and Tenant agrees to pay to Landlord on demand any deficiency that
             may arise by reason of such reletting together with all costs
             incurred by Landlord in connection with such reletting (including
             without limitation attorneys' fees and costs). Landlord shall have
             no obligation to relet the Premises in advance of any other
             available space owned by Landlord and shall not be liable for
             refusal or failure to relet or in the event of reletting the
             Premises at a rental in excess of that agreed to be paid by Tenant
             pursuant to the terms of this Lease, Landlord and Tenant each
             mutually agree that Tenant shall not be entitled, under any
             circumstances, to such excess rental, and Tenant does hereby
             specifically waive any claim to such excess rental.

         (3) Right to Cure. Enter upon the Premises, by self-help, at
             Landlord's option, without being liable for prosecution or any
             claim for damages therefor, and do whatever Tenant is obligated
             to do under the terms of this Lease and Tenant agrees to
             reimburse Landlord on demand for any expenses which Landlord may
             incur in this effecting compliance with Tenant's obligations under
             this Lease (including without limitation attorneys' fees and
             costs), and Tenant further agrees that Landlord shall not be
             liable for any damages resulting to Tenant from such action,
             whether caused by the negligence of Landlord or otherwise.

         (4) Damages After Default.  Whether or not Landlord terminates this
             Lease, retakes possession or relets the Premises, Landlord shall
             have the right to recover unpaid Rent and all damages caused by
             Tenant's default, including, without limitation, attorneys' fees
             and costs. Damages shall include, without limitation, (1) the worth
             at the time of award of the unpaid Rent and other amounts which had
             been earned at the time of termination, (2) the worth at the time
             of award of the amount by which the unpaid Rent and other amounts
             that would have been earned after the date of termination until the
             time of award exceeds the amount of such Rent loss that Tenant
             proves could have been reasonably avoided; (3) the worth at the
             time of award of the amount by which the unpaid Rent and other
             amounts for the balance of the Term after the time of award exceeds
             the amount of such Rent loss that the Tenant proves could be
             reasonably avoided; and (4) any other amount and court costs
             necessary to compensate Landlord for all detriment proximately
             caused by Tenant's failure to perform Tenant's obligations under
             this Lease or which, in the ordinary course of things, would be
             likely to result therefrom. The "worth at the time of award" as
             used in (1) and (2) above shall be computed at the Applicable
             Interest Rate (defined below). The "worth at the time of award" as
             used in (3) above shall be


                                       25
<PAGE>

             computed by discounting such amount at the Federal Discount Rate of
             the Federal Reserve Bank of San Francisco at the time of award plus
             one percent (1%). If this Lease provides for any periods during the
             Term during which Tenant is not required to pay Base Rent or if
             Tenant otherwise receives a Rent concession, then upon the
             occurrence of any event of defaults, Tenant shall owe to Landlord
             the full amount of such Base Rent or value of such Rent concession,
             plus interest at the Applicable Interest Rate, calculated from the
             date that such Base Rent or Rent concession would have been
             payable.

         (5) Multiple Actions. Landlord may sue periodically to recover damages
             during the period corresponding to the remainder of the Term, and
             no action for damages shall bar a later action for damages
             subsequently accruing.

         (6) Cumulative Remedies. Pursuit of any of the foregoing remedies
             shall not preclude Landlord from pursuit of any of the other
             remedies provided in this Lease or any other remedies provided by
             law or at equity, such remedies being cumulative and nonexclusive,
             nor shall pursuit of any remedy in this Lease provided constitute a
             forfeiture or waiver of any rent due to Landlord under this Lease
             or of any damages accruing to Landlord by reason of the violation
             of any of the terms, provisions, conditions, and covenants
             contained in this Lease. No act or thing done by Landlord or its
             agents shall be deemed a termination of this Lease or an acceptance
             of the surrender of the Premises, and no agreement to terminate
             this Lease or accept a surrender of the Premises shall be valid
             unless in writing signed by Landlord. No waiver by Landlord of any
             violation or breach of any of the terms, provisions and covenants
             contained in this Lease shall be deemed or construed to constitute
             a waiver of any other violation or breach of any of the terms,
             provisions, conditions, and covenants contained in this Lease.
             Landlord's acceptance of the payment of rental or other payments
             under this Lease after the occurrence of an Event of Default shall
             not be construed as a waiver of such default, unless Landlord so
             notifies Tenant in writing. Forbearance by Landlord from enforcing
             one or more of the remedies provided in this Lease upon an event of
             default shall not be deemed or construed to constitute a waiver of
             such default or of Landlord's right to enforce any such remedies
             with respect to such default or any subsequent default.

C.       Late Charge.  In addition to its other remedies, Landlord shall have
         the right without notice or demand to add to the amount of any payment
         required to be made by Tenant hereunder, and which is not paid and
         received by Landlord on or before the first day of each calendar month,
         an amount equal to five percent (5%) of the delinquency for each month
         or portion thereof that the delinquency remains outstanding to
         compensate Landlord for the loss of the use of the amount not paid and
         the administrative costs caused by the delinquency, the parties
         agreeing that Landlord's damage by virtue of such delinquencies would
         be extremely difficult and impracticable to compute and the amount
         stated herein represents a reasonable estimate thereof. Any waiver by
         Landlord of any late charges or failure to claim the same shall not
         constitute a waiver of other late charges or any other remedies
         available to Landlord.

D.       Interest. Interest shall accrue on all sums not paid when due
         hereunder at the lesser of eighteen percent (18%) per annum or the
         maximum interest rate allowed by law ("Applicable Interest Rate") from
         the due date until paid in full.

                                   27. LIENS

Tenant shall at all times keep the Premises and the Project free from liens
arising out of or related to work or services performed, materials or supplies
furnished or obligations incurred by or on behalf of Tenant or in connection
with work made, suffered or done by or on behalf of Tenant in or on the Premises
or Project. If Tenant shall not, within ten (10) days following the imposition
of any such lien, cause the same to be released of record by payment or posting
of a proper bond, Landlord shall have, in addition to all other remedies
provided herein and by law, the right, but not the obligation, to cause the same
to be released by such means as Landlord shall deem proper, including payment of
the claim giving rise to such lien. All


                                       26
<PAGE>


sums paid by Landlord on behalf of Tenant and all expenses incurred by Landlord
in connection therefor shall be payable to Landlord by Tenant on demand with
interest at the Applicable Interest Rate as Additional Rent. Landlord shall have
the right at all times to post and keep posted on the Premises any notices
permitted or required by law, or which Landlord shall deem proper, for the
protection of Landlord, the Premises, the Project and any other party having an
interest therein, from mechanics' and materialmen's liens, and Tenant shall give
Landlord not less than five (5) business days prior written notice of the
commencement of any work in the Premises or Project which could lawfully give
rise to a claim for mechanics' or materialmen's liens to permit Landlord to post
and record a timely notice of non-responsibility, as Landlord may elect to
proceed or as the law may from time to time provide, for which purpose, if
Landlord shall so determine, Landlord may enter the Premises. Tenant shall not
remove any such notice posted by Landlord without Landlord's consent, and in any
event not before completion of the work which could lawfully give rise to a
claim for mechanics' or materialmen's liens.

                           28. TRANSFERS BY LANDLORD

In the event of a sale or conveyance by Landlord of the Building or a
foreclosure by any creditor of Landlord, the same shall operate to release
Landlord from any liability upon any of the covenants or conditions, express or
implied, herein contained in favor of Tenant, to the extent required to be
performed after the passing of title to Landlord's successor-in-interest. In
such event, Tenant agrees to look solely to the responsibility of the
successor-in-interest of Landlord under this Lease with respect to the
performance of the covenants and duties of "Landlord" to be performed after the
passing of title to Landlord's successor-in-interest. This Lease shall not be
affected by any such sale and Tenant agrees to attorn to the purchaser or
assignee. Landlord's successor(s)-in-interest shall not have liability to Tenant
with respect to the failure to perform any of the obligations of "Landlord," to
the extent required to be performed prior to the date such
successor(s)-in-interest became the owner of the Building.

               29. RIGHT OF LANDLORD TO PERFORM TENANT'S COVENANTS

All covenants and agreements to be performed by Tenant under any of the terms of
this Lease shall be performed by Tenant at Tenant's sole cost and expense and
without any abatement of Rent. If Tenant shall fail to pay any sum of money,
other than Base Rent, required to be paid by Tenant hereunder or shall fail to
perform any other act on Tenant's part to be performed hereunder, including
Tenant's obligations under Paragraph 11 hereof, and such failure shall continue
for fifteen (15) days after notice thereof by Landlord, in addition to the other
rights and remedies of Landlord, Landlord may make any such payment and perform
any such act on Tenant's part. In the case of an emergency, no prior
notification by Landlord shall be required. Landlord may take such actions
without any obligation and without releasing Tenant from any of Tenant's
obligations. All sums so paid by Landlord and all incidental costs incurred by
Landlord and interest thereon at the Applicable Interest Rate, from the date of
payment by Landlord, shall be paid to Landlord on demand as Additional Rent.

                                   30. WAIVER

If either Landlord or Tenant waives the performance of any term, covenant or
condition contained in this Lease, such waiver shall not be deemed to be a
waiver of any subsequent breach of the same or any other term, covenant or
condition contained herein, or constitute a course of dealing contrary to the
expressed terms of this Lease. The acceptance of Rent by Landlord shall not
constitute a waiver of any preceding breach by Tenant of any term, covenant or
condition of this Lease, regardless of Landlord's knowledge of such preceding
breach at the time Landlord accepted such Rent. Failure by Landlord to enforce
any of the terms, covenants or conditions of this Lease for any length of time
shall not be deemed to waive or decrease the right of Landlord to insist
thereafter upon strict performance by Tenant. Waiver by Landlord of any term,
covenant or condition contained in this Lease may only be made by a written
document signed by landlord, based upon full knowledge of the circumstances.

                                  31. NOTICES


                                       27
<PAGE>

Each provision of this Lease or of any applicable governmental laws, ordinances,
regulations and other requirements with reference to sending, mailing, or
delivery of any notice or the making of any payment by Landlord or Tenant to the
other shall be deemed to be complied with when and if the following steps are
taken:

A.       Rent.  All Rent and other payments required to be made by Tenant to
         Landlord hereunder shall be payable to Landlord at Landlord's
         Remittance Address set forth in the Basic Lease Information, or at such
         other address as Landlord may specify from time to time by written
         notice delivered in accordance herewith. Tenant's obligation to pay
         Rent and any other amounts to Landlord under the terms of this Lease
         shall not be deemed satisfied until such Rent and other amounts have
         been actually received by Landlord.

B.       Other.  All notices, demands, consents and approvals which may or are
         required to be given by either party to the other hereunder shall be in
         writing and either personally delivered, sent by commercial overnight
         courier, mailed, certified or registered, postage prepaid or sent by
         facsimile with confirmed receipt (and with an original sent by
         commercial overnight courier), and in each case addressed to the party
         to be notified at the Notice Address for such party as specified in the
         Basic Lease Information or to such other place as the party to be
         notified may from time to time designate by at least fifteen (15) days
         notice to the notifying party. Notices shall be deemed served upon
         receipt or refusal to accept delivery. Tenant appoints as its agent to
         receive the service of all default notices and notice of commencement
         of unlawful detainer proceedings the person in charge of or apparently
         in chart of occupying the Premises at the time, and, if there is no
         such person, then such service may be made by attaching the same on the
         main entrance of the Premises.


C.       Required Notices. Tenant shall immediately notify Landlord in writing
         of any notice of a violation or a potential or alleged violation of any
         Regulation that relates to the Premises or the Project, or of any
         inquiry, investigation, enforcement or other action that is instituted
         or threatened by any governmental or regulatory agency against Tenant
         or any other occupant of the Premises, or any claim that is instituted
         or threatened by any third party that relates to the Premises or the
         Project.

                              32. ATTORNEYS' FEES

If Landlord places the enforcement of this Lease, or any part thereof, or the
collection of any Rent due, or to become due hereunder, or recovery of
possession of the Premises in the hands of an attorney, Tenant shall pay to
Landlord, upon demand, Landlord's reasonable attorneys' fees and court costs,
whether incurred at trial, appeal or review. In any action which Landlord or
Tenant brings to enforce its respective rights hereunder, the unsuccessful party
shall pay all costs incurred by the prevailing party including reasonable
attorneys' fees, to be fixed by the court, and said costs and attorneys' fees
shall be a part of the judgment in said action.

                           33. SUCCESSORS AND ASSIGNS

This Lease shall be binding upon and inure to the benefit of Landlord, its
successors and assigns, and shall be binding upon and inure to the benefit of
Tenant, its successors, and to the extent assignment is approved by Landlord as
provided hereunder, Tenant's assigns.

                               34. FORCE MAJEURE

If performance by a party of any portion of this Lease is made impossible by any
prevention, delay, or stoppage caused by strikes, lockouts, labor disputes, acts
of God, inability to obtain services, labor, or materials or reasonable
substitutes for those items, government actions, civil commotions, fire or other
casualty, or other causes beyond the reasonable control of the party obligated
to perform, performance by

                                       28
<PAGE>

that party for a period equal to the period of that prevention, delay, or
stoppage is excused. Tenant's obligation to pay Rent, however, is not excused by
this Paragraph 35.

                           35. SURRENDER OF PREMISES

Tenant shall, upon expiration or sooner termination of this Lease, surrender the
Premises to Landlord in the same condition, excepting normal wear and tear, as
existed on the date Tenant originally took possession thereof, including, but
not limited to, all interior walls cleaned, all holes in walls repaired, all
HVAC equipment in operating order and in good repair, and all floors cleaned and
free of any Tenant-introduced marking or painting, all to the reasonable
satisfaction of Landlord. However, Tenant shall be responsible for removing all
specialty tenant improvements and equipment that specifically relate to Tenant's
manufacturing and production of testing and calibration equipment (i.e., clean
rooms, electrical, plumbing and HVAC service to support clean rooms), which were
installed for and by the immediately preceding Tenant, all of which will be in
place at the time of Tenant's occupancy, and for restoring the Premises to shell
condition in areas where said tenant improvements and equipment are removed.
Landlord and Tenant shall mutually agree upon which specialty improvements shall
be the Tenant's responsibility to remove from the Premises upon vacation of the
Premises, and areas where restoration will be anticipated, and both parties
shall enter into a separate agreement identifying said specialty tenant
improvements within thirty (30) days after Tenant's occupancy. Tenant shall
remove all of its debris from the Project. At or before the time of surrender,
Tenant shall comply with the terms of Paragraph 12.A. hereof with respect to
Alterations to the Premises and all other matters addressed in such Paragraph.
If the Premises are not so surrendered at the expiration or sooner termination
of this Lease, the provisions of Paragraph 25 hereof shall apply. All keys to
the Premises or any part thereof shall be surrendered to Landlord upon
expiration or sooner termination of the Term. Tenant shall give written notice
to Landlord at least thirty (30) days prior to vacating the Premises and shall
meet with Landlord for a joint inspection of the Premises at the time vacating,
but nothing contained herein shall be construed as an extension of the Term or
as a consent by Landlord to any holding over by Tenant. In the event of Tenant's
failure to give such notice or participate in such joint inspection, Landlord's
inspection at or after Tenant's vacating the Premises shall conclusively be
deemed correct for purposes of determining Tenant's responsibility for repairs
and restoration. Any delay caused by Tenant's failure to carry out its
obligations under this Paragraph 36 beyond the term hereof, shall constitute
unlawful and illegal possession of Premises under Paragraph 25 hereof.


                               36. MISCELLANEOUS

A.       General. The term "Tenant" or any pronoun used in place thereof
         shall indicate and include the masculine or feminine, the
         singular or plural number, individuals, firms or corporations, and
         their respective successors, executors, administrators and permitted
         assigns, according to the context hereof.

B.       Time.  Time is of the essence regarding this Lease and all of its
         provisions.

C.       Choice of Law.  This Lease shall in all respects be governed by the
         laws of the State of Oregon.

D.       Entire Agreement. This Lease, together with its Exhibits, addenda and
         attachments and the Basic Lease Information, contains all the
         agreements of the parties hereto and supercedes any previous
         negotiations. There have been no representations made by the Landlord
         or understandings made between the parties other than those set forth
         in this Lease and its Exhibits, addenda and attachments and the Basic
         Lease Information.

E.       Modification. This Lease may not be modified except by a written
         instrument signed by the parties hereto. Tenant accepts the area of the
         Premises as specified in the Basic Lease Information as the approximate
         area of the Premises for all purposes under this Lease, and
         acknowledges and agrees that no other definition of the area (rental,
         usable or otherwise) of the Premises shall apply. Tenant shall in no
         event be entitled to a recalculation of the square footage of the
         Premises, rental, usable or otherwise, and no recalculation, if made,
         irrespective of its purpose, shall reduce


                                       29
<PAGE>

         Tenant's obligations under this Lease in any manner, including without
         limitation the amount of Base Rent payable by Tenant or Tenant's
         Proportionate Share of the Building and of the Project.

F.       Severability. If, for any reason whatsoever, any of the provisions
         hereof shall be unenforceable or ineffective, all of the other
         provisions shall be and remain in full force and effect.

G.       Recordation. Tenant shall not record this Lease or a short form
         memorandum hereof, unless it is required by a prospective lender of
         Tenant, in which case a Memorandum in a form substantially similar to
         the form attached hereto as Exhibit "D," and which has been reasonably
         approved by landlord, can be recorded by Tenant.

H.       Examination of Lease. Submission of this Lease to Tenant does not
         constitute an option or offer to lease and this Lease is not effective
         otherwise until execution and delivery by both Landlord and Tenant.

I.       Accord and Satisfaction. No payment by Tenant or a lesser amount than
         the total Rent due nor any endorsement on any check or letter
         accompanying any check or payment of Rent shall be deemed an accord and
         satisfaction of full payment of Rent, and Landlord may accept such
         payment without prejudice to Landlord's right to recover the balance of
         such Rent or to pursue other remedies. All offers by or on behalf of
         Tenant of accord and satisfaction are hereby rejected in advance.

J.       Easements. Landlord may grant easements on the Project and dedicate for
         public use portions of the Project without Tenant's consent; provided
         that no such grant or dedication shall materially interfere with
         Tenant's Permitted Use of the Premises or Tenant's overall parking
         ratio. Upon Landlord's request, Tenant shall execute, acknowledge and
         deliver to Landlord documents, instruments, maps and plats necessary to
         effectuate Tenant's covenants hereunder.

K.       Drafting and Determination Presumption. The parties acknowledge that
         this Lease has been agreed to by both the parties, that both Landlord
         and Tenant have consulted with attorneys with respect to the terms of
         this Lease and that no presumption shall be created against Landlord
         because Landlord drafted this Lease. Except as otherwise specifically
         set forth in this Lease, with respect to any consent, determination or
         estimation shall be given or made solely by Landlord in Landlord's
         reasonable and good faith opinion, whether or not objectively
         reasonable.

L.       Exhibits. The Basic Lease Information, and the Exhibits, addenda and
         attachments attached hereto are hereby incorporated herein by this
         reference and made a part of this Lease as though fully set forth
         herein.

M.       No Light, Air or View Easement. Any diminution or shutting off of
         light, air or view by any structure which may be erected on lands
         adjacent to or in the vicinity of the Building shall in no way affect
         this Lease or impose any liability on Landlord.

N.       No Third Party Benefit. This Lease is a contract between Landlord and
         Tenant and nothing herein is intended to create any third party
         benefit.

O.       Quiet Enjoyment. Upon payment by Tenant of the Rent, and upon the
         observance and performance of all of the other covenants, terms and
         conditions on Tenant's part to be observed and performed. Tenant shall
         peaceably and quietly hold and enjoy the Premises for the term hereby
         demised without hindrance or interruption by Landlord or any other
         person or persons lawfully or equitably claiming by, through or under
         Landlord, subject, nevertheless, to all of the other terms and
         conditions of this Lease. Landlord shall not be liable for any
         hindrance, interruption, interference or disturbance by other tenants
         or third persons, nor shall Tenant be released from any obligations
         under this Lease because of such hindrance, interruption, interference
         or disturbance.


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<PAGE>


P.       Counterparts. This Lease may be executed in any number of counterparts,
         each of which shall be deemed an original.

Q.       Multiple Parties. If more than one person or entity is named herein
         as Tenant, such multiple parties shall have joint and several
         responsibility to comply with the terms of this Lease.

R.       Jury Trial Waiver.  Each party hereto (which includes any Assignee,
         successor heir or personal representative of a party) shall not seek a
         jury trial, hereby waives trial by jury, and hereby further waives any
         objection to venue in the county in which the Building is located, and
         agrees and consents to personal jurisdiction of the courts of the state
         in which the Property is located, in any action or proceeding or
         counterclaim brought by any party hereto against the other on any
         matter whatsoever arising out of or in any way connected with this
         Lease, the relationship of Landlord and Tenant, Tenant's use or
         occupancy of the Premises, or any claim of injury or damage, or the
         enforcement of any remedy under any statute, emergency or otherwise,
         whether any of the foregoing is based on this Lease or on tort law.
         Each party represents that it has had the opportunity to consult with
         legal counsel concerning the effect of this Paragraph 37.R. The
         provisions of this Paragraph 37.R shall survive the expiration or
         earlier termination of this Lease.

S.       Prorations. Any Rent or other amounts payable to Landlord by Tenant
         hereunder for any fractional month shall be prorated based on a
         month of 30 days. As used herein, the term "fiscal year" shall
         mean the calendar year or such other fiscal year as Landlord may
         deem appropriate.

T.       Disclosure. Landlord is a licensed real estate organization and parties
         affiliated with Landlord are licensed real estate brokers or
         salespersons. This disclosure is made pursuant to OAR 863-10-046.

                            38. ADDITIONAL PROVISIONS

A.       Beneficial Occupancy. Beneficial Occupancy shall be the date Tenant
         takes possession of the Premises which is anticipated to occur on or
         before August 1, 1999. The Lease shall commence on the first Monday
         after Tenant has had thirty (30) days of Beneficial Occupancy of the
         Premises to install its equipment, furniture and phone and Landlord has
         presented Tenant with a Certificate allowing legal occupancy and use of
         the Premises as intended under this Lease. The installation of
         network/data and phone related cabling shall be contracted for by
         Tenant and coordinated with Landlord and completed during construction.

B.       Option to Renew. Tenant shall, provided this Lease is in full force and
         effect and Tenant is not and has not been in default under any of the
         terms and conditions of this Lease beyond the applicable cure period,
         have one option to renew this Lease for a term of five (5) years, for
         the Premises in "as is" condition and on the same terms and conditions
         set forth in this Lease, except as modified by the terms, covenants and
         conditions set forth below:

         (1)      If Tenant elects to exercise such option, then Tenant shall
                  provide Landlord with written notice no earlier than the date
                  which is no earlier than two hundred seventy (270 days prior
                  to the expiration of the then current term of this Lease, but
                  no later than 5:00 p.m. (Pacific Standard Time) on the date
                  which is one hundred eighty (180) days prior to the expiration
                  of the then current term of this Lease. If Tenant fails to
                  provide such notice, Tenant shall have no further or
                  additional right to extend or renew the term of this Lease.

         (2)      The Base Rent in effect at the expiration of the then current
                  term of this Lease shall be increased to reflect the then
                  current fair market rental for comparable space in the
                  Building or Project and in other similar buildings in the same
                  rental market as of the date the renewal term is to commence,
                  taking into account the specific provisions of this Lease
                  which will remain constant, and the Building amenities,
                  location, identity, quality, age, conditions, term of lease,
                  tenant improvements, services provided, and other pertinent
                  items.


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<PAGE>

         (3)      Landlord shall advise Tenant of the new Base Rent for the
                  Premises for the applicable renewal term which will be based
                  on Landlord's determination of fair market rental value, as
                  well as additional terms and conditions for the renewal term,
                  no later than fifteen (15) days after receipt of Tenant's
                  exercise of its option to renew.

         (4)      Landlord and Tenant shall negotiate in good faith to agree on
                  the fair market rental value of the Premises and terms and
                  conditions for the first (1) through sixtieth (60) months of
                  the Term and for each subsequent rental increase to be based
                  on fair market rental as set forth in the Basic Lease
                  Information. If Tenant and Landlord are unable to agree on a
                  mutually acceptable rental rate for any such increase period
                  within thirty (30) days after modification by Landlord to
                  Tenant of Landlord's determination of the new Base Rent for
                  the applicable increase period, but in any event no later than
                  the date which is ninety (90) days prior to the expiration of
                  the then current Term, then on or before such date Landlord
                  and Tenant shall each appoint a licensed real estate broker
                  with at least ten (10) year's experience in leasing industrial
                  space in the area in which the Building is located to act as
                  arbitrators. The two (2) arbitrators so appointed shall
                  determine the fair market rental value for the Premises for
                  the applicable increase period based on the above criteria and
                  each shall submit his or her determination of such fair market
                  rental value to Landlord and Tenant in writing, within sixty
                  (60) days after their appointment.

                  If the two (2) arbitrators so appointed cannot agree on the
                  fair market rental value for the applicable increase period
                  within such 60-day period, the two (2) arbitrators shall
                  within five (5) days thereafter appoint a third arbitrator who
                  shall be a licensed real estate broker with at least ten (10)
                  year's experience in leasing industrial space in the area in
                  which the Building is located. The third arbitrator so
                  appointed shall independently determine the fair market rental
                  value for the Premises for the applicable increase period with
                  thirty (30) days after appointment, by selecting form the
                  proposals submitted by each of the first two arbitrators the
                  one that most closely approximates the third arbitrator's
                  determination of such fair market rental value. The third
                  arbitrator shall have no right to adopt a compromise or middle
                  ground or any modification of either of the proposals
                  submitted by the first two arbitrators. The proposal chosen by
                  the third arbitrator as most closely approximating the third
                  arbitrator's determination of the fair market rental value for
                  the applicable increase period shall constitute the decision
                  and award of the arbitrators and shall be final and binding on
                  the parties.

                  Each party shall pay the fees and expenses of the arbitrator
                  appointed by such party and one-half (1/2) of the fees and
                  expenses of the third arbitrator. Notwithstanding the
                  foregoing, in the event the Base Rent for the applicable
                  increase period is found to be within five percent (5%) of the
                  original rate quoted by the Landlord, then Tenant shall bear
                  the full cost of the arbitration process.

C.       Existing Improvements. No existing improvements or related equipment
         will be removed from the Premises prior to Tenant's occupancy, except
         for those items confirmed by Tenant. All items of interest to Tenant
         will be confirmed in writing by both parties.

D.       Competitive Bidding. Tenant shall not the right to approve the general
         contractor, however said approval shall not be unreasonably withheld.
         Landlord shall enter into a contract with the successful general
         contractor.

E.       Tenant's Contractors. Tenant shall have the right to retain its own
         specialty contractors to perform any portion of the work necessary to
         construct and outfit the Premises (which will not be part of the
         general contractor's scope of work nor shall a mark-up be added). All
         subcontractors used by Tenant shall be licensed, bonded and insured.



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<PAGE>

F.       Project Oversight. Tenant shall want to manage some of the Tenant
         Improvement installations, including those paid for out of the
         improvement allowance. Landlord and Tenant shall mutually agree upon
         which items Tenant shall manage.

G.       Design Working Drawings. Tenant will provide Landlord on or before
         April 15, 1999, with a preliminary space plan that may include
         furniture layout, equipment placement and electrical/phone/data
         placement and specifications. Landlord shall cause its architect to, as
         part of the Base Building and at its sole cost, complete all
         construction documents to code, including but not limited to
         mechanical, electrical, structural and other required detail for
         design, permitting and construction of the tenant improvements.

H.       Signage/Identity. Tenant shall have the right to install "top of
         building" and "monument" signage on or about the building with
         Landlord's approval, which shall not be unreasonably withheld, subject
         to park-wide CC&R's.

I.       Code Compliance. Landlord shall be responsible for delivering, at its
         sole cost and expense, the building, Tenant's tenant improvements and
         common areas compliant with all applicable governmental or recorded
         codes, ordinances, laws, rules, covenants and restrictions. Compliance
         shall include, and not be limited to structural, electrical,
         mechanical, construction labor and materials, based on codes that were
         in place at the time the building was constructed.

J.       Tenant Improvements. Spieker Properties will provide a tenant
         improvement allowance of up to $12.00 per rsf based upon a mutually
         agreeable space plan, to be used for tenant improvements in the
         building. Said allowance may be used for hardwalls, doors, relites,
         carpet, paint, plumbing, cabinetry, cleanrooms, utility systems,
         process improvements, related electrical and equipment. Landlord shall
         obtain bids for the proposed improvements, based on agreed upon space
         plans, specifications and architecture drawings.

         Tenant shall be allowed to carry over and draw on the tenant
         improvement allowance of $12.00 per square foot through the time period
         no later than December 31, 2000; however, in no event shall the funds
         that may be carried over to the calendar year 2000 be in excess of
         $400,000.00. If the $12.00 per square foot tenant improvement allowance
         has not been entirely used at the point of Tenant's initial occupancy,
         then Tenant shall provide Landlord with appropriate notice as described
         in Paragraph 12, Alterations, prior to proceeding with additional
         tenant improvements or alterations. Upon completion of any
         Landlord-approved tenant improvements or alterations during the
         calendar year 2000, Tenant shall present Landlord with an invoice(s),
         along with all appropriate backup, for reimbursement. Landlord shall
         reimburse Tenant for said invoice(s) within 20 business days of receipt
         of said invoice(s).

         Tenant shall be allowed to use the $12.00 per square foot tenant
         improvement allowance toward any and all work described in the attached
         Exhibit "C-1", Tenant Improvements.

K.       Delivery of Letter of Credit.  In lieu of depositing a security deposit
         with Landlord, Tenant may, on execution of this Lease, deliver to
         Landlord and cause to be in effect during the Lease Term an
         unconditional, irrevocable letter of credit ("LOC") in the amount
         specified for the Security Deposit in the Basic Lease Information, as
         it may be increased as provided in this Lease (the "LOC Amount") for an
         initial term extending 30 days beyond the expiration date of this
         Lease. The LOC shall be in a form acceptable to Landlord and shall be
         issued by an LOC bank selected by Tenant and acceptable to Landlord. An
         LOC bank is a bank that accepts deposits, maintains accounts, has a
         local office that will negotiate a letter of credit, and the deposits
         of which are insured by the Federal Deposit Insurance Corporation.
         Tenant shall pay all expenses, points, or fees incurred by Tenant in
         obtaining the LOC. The LOC shall not be mortgaged, assigned or
         encumbered in any manner whatsoever by Tenant without the prior written
         consent of Landlord. Tenant acknowledges that Landlord has the right to
         transfer or mortgage, Landlord shall have the right to transfer or
         assign the LOC and/or the LOC Security Deposit (as defined below) to
         the transferee or mortgagee for the return of the LOC and/or the LOC
         Security Deposit.

                                       33
<PAGE>

         (i)      Replacement of Letter of Credit. Tenant may, from time to
                  time, replace any existing LOC with a new LOC if the new LOC
                  (a) becomes effective at least thirty (30) days before
                  expiration of the LOC that it replaces; (b) is in the required
                  LOC amount; (c) is issued by an LOC bank acceptable to
                  Landlord; and (d) otherwise complies with the requirements of
                  this Paragraph K.

         (ii)     Landlord's Right to Draw on Letter of Credit.  Landlord shall
                  hold the LOC as security for the performance of Tenant's
                  obligations under this Lease. If, after notice and failure to
                  cure within any applicable period provided in this lease,
                  Tenant defaults on any provision of this Lease, Landlord may,
                  without prejudice to any other remedy it has, draw on that
                  portion of the LOC necessary to (a) pay Rent or other sum in
                  default; (b) pay or reimburse Landlord for any amount that
                  Landlord may spend or become obligated to spend in exercising
                  Landlord's rights under Paragraph 30 (Right of Landlord to
                  Perform Tenant's Covenant), and/or compensate Landlord for any
                  expense, loss, or damage that Landlord may suffer because of
                  Tenant's default. If Tenant fails to renew or replace the LOC
                  at least thirty (30) days before its expiration, Landlord may,
                  without prejudice to any other remedy it has, draw on the
                  entire amount of the LOC.

        (iii)     LOC Security Deposit. Any amount of the LOC that is drawn on
                  by the Landlord but not applied by Landlord shall be held by
                  Landlord as a security deposit (the "LOC Security Deposit")
                  in accordance with Paragraph 19 of this Lease.

         (iv)     Restoration of Letter of Credit and LOC Security Deposit. If
                  Landlord draws on any portion of the LOC and/or applies all or
                  any portion of such draw, Tenant shall, within five (5)
                  business days after demand by Landlord, either (a) deposit
                  cash with Landlord in an amount that, when added to the amount
                  remaining under the LOC and the amount of any LOC Security
                  Deposit, shall equal the LOC Amount then required under this
                  Paragraph K, or (b) reinstate the LOC to the full LOC Amount.

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


<TABLE>
<CAPTION>

LANDLORD                                            TENANT

<S>                                               <C>

Spieker Properties, L.P.,                           Cascade Microtech, Inc.
a California limited partnership                    an Oregon corporation

By:      Spieker Properties, Inc.
         a Maryland corporation,
         its general partner

By:           /s/ LYNDA M. CLARKE                   By:      /s/ ERIC W. STRID
         -----------------------------------              -----------------------------------
         Lynda M. Clarke                                  Eric W. Strid
Its:     Vice President                            Its:   Chief Executive Office

Date:    4-2-99                                    Date:  April 2, 1999



</TABLE>


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