<PAGE>

                                STANDARD OFFICE LEASE


    This Lease is made as of the 5th day of June, 1997 by and between PACIFIC
RESOURCES DEVELOPMENT INC., a California corporation ("Landlord"), and HAMBRECHT
& QUIST, a corporation ("TENANT"), who agree as follows:

                               BASIC LEASE INFORMATION

    The following is the Basic Lease Information of this Lease.  Other sections
of this Lease explain and define the Basic Lease Information in more detail and
are to be read in conjunction herewith.  In the event of any conflict between
the Basic Lease Information and the other sections of this Lease, the Lease
shall control.

LANDLORD:                    Pacific Resources Development Inc.

NOTICE ADDRESS:              225 Bush Street
                             San Francisco, California 94104

TENANT:                      Hambrecht & Quist California
         
NOTICE ADDRESS:              One Bush Street 
                             San Francisco, CA  94104

PREMISES:                    Floor: 4th     Suite No.: 400 

NET RENTABLE AREA
 OF PREMISES:                22,675 square feet

BUILDING:                    225 Bush Street
                             San Francisco, CA  94104

BASE RENT (PER SQUARE
FOOT PER ANNUM):             $24.00

BASE RENT (PER MONTH):       $ 45,350.00

ANTICIPATED 
EXECUTION DATE:              May, 1997

ANTICIPATED TARGET
COMMENCEMENT                 July 1, 2000
DATE:

TERMINATION DATE:            December 31, 2003

LENGTH OF TERM:              Three years and six months

TENANT'S PERCENTAGE 
SHARE:                       4.686%; such share is a fraction, the numerator of
                             which is the net rentable area of the Premises
                             (22,675 sq. ft.) and the denominator of which is
                             the net rentable office area of the Building
                             (483,937 sq. ft.).

<PAGE>

BASE YEAR:                   January 1, 1997 to December 31, 1997

SECURITY DEPOSIT:            $ 0.00

BROKERS:                     Landlord's:     Grubb & Ellis
                             Tenants         Stein Kingsley Stein

TENANT'S MINIMUM
INSURANCE 
REQUIREMENT:                 $1,000,000

PERMITTED USES:              General Office Use

OTHER SPECIAL
PROVISIONS:                  See Addendum





                                         -2-
<PAGE>

                                       RECITALS
                                           
    A.   Landlord is the owner of certain real property  (the "REAL PROPERTY")
at 225 Bush Street, in the City and County of San Francisco and the Building (as
later defined) located on it. The Real Property and the Building are
collectively referred to herein as the "Property."

    B.   Landlord desires to lease to Tenant, and Tenant desires to lease from
Landlord the Premises (as later defined) for the term and subject to the terms,
covenants, agreements, and conditions in this Lease.

    For good and valuable consideration the receipt and adequacy of which are
acknowledged, the parties agree as follows:

    SECTION 1.     DEFINITIONS     As used in this Lease, the following terms 
are defined in Section 1.

    ALTERATIONS is defined in Section 9(a).

    ANTICIPATED TARGET COMMENCEMENT DATE means the date specified in the Basic
Lease Information.

    ANTICIPATED TERMINATION DATE means the date specified in the Basic Lease
Information.

    BASE OPERATING EXPENSES means the Operating Expenses paid or incurred by
Landlord in the Base Year.

    BASE PROPERTY TAXES means the amount of Property Taxes for the calendar year
ending December 31, 1997.

    BASE RENT means the Base Rent as set forth in the Basic Lease Information.

    BASE YEAR means the 12 calendar month period specified in the Basic Lease
Information as the Base Year.

    BUILDING means the building constructed on the Real Property located at 225
Bush Street, San Francisco, California, any property interest in the area of the
Building, and all other improvements on, or appurtenances to, the Real Property
or the streets abutting the Real Property. The Building includes, but is not
limited to, an office building with 22 stories, a basement within which a
parking garage is located and two mezzanines.

    COMMENCEMENT DATE means July 1, 2000.

    DEPOSIT is defined in Section 35.

    ESCALATION RENT is defined in Section 4(a).

    EVENT OF DEFAULT is defined in Section 19.

    IMPOSITIONS is defined in Section 8.

    LANDLORD is defimed in the preamble.

    LEASE is defimed in the preamble.


                                         -3-
<PAGE>

    LEGAL REQUIREMENTS is defined in Section 15.

    OPERATING EXPENSES means (a) all reasonable costs of management, operation,
and maintenance of the Building actually incurred by Landlord, including without
limitation: wages, salaries, and payroll burden of employees from the position
of Building Manager and below; commercially reasonable property mar nagement
fees and other related compensation; janitorial, maintenance, security, and
other services; Building office rent or rental value; power, water, waste
disposal, and other utilities; materials and supplies; maintenance and repairs;
license costs; commercially reasonable insurance premiums and the deductible
portion of any insured loss under Landlord's insurance in an amount not to
exceed $10,000 in any one year; and depreciation on personal property; and (b)
the cost of any capital improvements made to the Building by Landlord afler the
Base Year that (i) are made in the reasonable expectation of reducing other
Operating Expenses during the term of this Lease, (ii) are required for the
health and safety of tenants, or (iii) are required under any governmental law
or regulation that was not applicable to the Building as of January 1, 1997,
this cost to be amortized over a reasonable period determined by Landlord,
together with interest on the unamortized balance at the rate of ten percent
(10%) per annum, or a higher rate equal to that paid by Landlord on funds
borrowed for the purpose of constructing or installing those capital
improvements. Operating Expenses shall not include: Property Taxes; depreciation
on the Building other than depreciation on exterior window draperies, if any,
provided by Landlord, and carpeting in multi-tenant floor public corridors and
common areas; costs of tenants' improvements; real estate brokers' commissions;
interest; costs incurred m connection with the repair of damage to the Building,
to the extent Landlord is reimbursed by insurance proceeds; and capital items
other than those referred to in clause (b). Actual Operating Expenses for both
the Base Year and each subsequent year will be adjusted to equal Landlord's
reasonable estimate of Operating Expenses had the total rentable area of the
Building been occupied.

    PREMISES means the portion of the Building located on the floor or floors
specified Basic Lease Information which is outlined in red on the floor plan or
plans attached to this Lease as Exhibit A.

    PROPERTY is defined in Recital A of this Lease.

    PROPERTY TAXES means all real properly taxes (and any tax levied wholly or
partly in lieu of real property taxes) levied against the Properly, and all real
estate tax consultant expenses and attorneys' fees reasonably incurred for the
purpose of maintaining an equitable assessed valuation of the Property.

    REAL PROPERTY is defined in Recital A of this Lease.

    TENANT is defined in the preamble.

    TENANT'S PERCENTAGE SHARE means the percentage figure specified as Tenant's
Percentage Share in the Basic Lease Information. Tenant's Percentage Share has
been obtained by dividing the net rentable area of the Premises, as specified in
the Basic Lease Information, by the total net rentable area of the Building,
which is 483,937 square feet, and multiplying that quotient by one hundred 
(100). In the event the rentable area of the Premises is increased or decreased
by the addition to or deletion from the Premises of any office space, Tenant's
percentage share shall be appropriately adjusted. For the purposes of Section 4,
Tenant's Percentage Share shall be based on the number of days during the
calendar year in which this change occurs.

    TERM is defined in Section 3 of this Lease.

    TERMINATION DATE means the Termination Date in the Basic Lease Information.


                                         -4-
<PAGE>

    SECTION 2. PREMISES.     Landlord leases to Tenant, and Tenant leases from
Landlord the Premises for the term and subject to the terms, covenants,
agreements, and conditions later set forth, to each of which Landlord and Tenant
mutually agree. All of the windows and outside walls of the Premises and any
space in the Premises used for shafts, stacks, pipes, conduits, ducts.
electrical equipment or other utilities or Building facilities are reserved
solely to Landlord and Landlord shall have rights of access through the Premises
for the purpose of operating, maintaining and repairing the same, provided that
any such entry shall be performed in a manner reasonably intended to minimize
any inconvenience to Tenant.

    SECTION 3. TERM; CONDITION OF PREMISES. The Term of this Lease shall
commence on the Commencement Date and, unless sooner terminated as later
provided, shall end on the Termination Date.

    SECTION 4. RENTAL.

    (a) Tenant shall pay to Landlord throughout the Term as rental for the
Premises the Base Rent, provided that the rental payable during each year
subsequent to the Base Year shall be the Base Rent, increased by Tenant's
Percentage Share of the total dollar increase, if any, in Operating Expenses
paid or incurred by Landlord in that year over the Base Operating Expenses, and
also increased by Tenant's Percentage Share of the total dollar increase, if
any, in Property Taxes paid by Landlord in that year over the Base Properly
Taxes. The increased rental due pursuant to this Section 4(a) is the Escalation
Rent.

    (b) Rental shall be paid to Landlord, in advance, on or before the first
day of the Term of this Lease and on or before the first day of each successive
calendar month during the Term of this Lease. In the event the Term of this
Lease commences on a day other than the first day of a calendar month or ends on
a day other than the last day of a calendar month, the monthly rental for the
first and last fractional months of the Term of this Lease shall be
appropriately prorated.

    (c) All sums of money due to Landlord under this Lease, not specifically
characterized as rental, shall constitute additional rent and shall be due
within thirty (30) days after receipt by Tenant of a billing. If any sum is not
paid when due, it shall be collectible as additional rent with the next
installment of rental falling due. Nothing contained in this Lease shall be
deemed to suspend or delay the payment of any sum of money at the time it
becomes due and payable under this Lease, or to limit any other remedy of
Landlord.

    (d) Tenant acknowledges that late payment of rent and other sums due under
this Lease will cause Landlord to incur costs not contemplated by this Lease,
the exact amount of which will be difficult to ascertain. These costs include,
but are not limited to, processing and accounting charges and late charges which
may be imposed on Landlord by the terms of any trust deed covering the Premises.
Accordingly, if any installment of rent or any other sums due from Tenant are
not received (i) within three (3) calendar days after delivery of written notice
from Landlord of Landlord's failure to receive such rent or other sums, or (ii)
in the event Landlord has already delivered such late payment notice once in any
one continuous twelve (12) month period, when due, Tenant shall pay to Landlord
a late charge equal to five percent. (5%) of the overdue amount. The parties
agree that the late charge represents a fair and reasonable estimate of the
costs Landlord will incur because of late payment. Acceptance of the late charge
by Landlord shall not constitute a waiver of Tenant's default for the overdue
amount, nor prevent Landlord from exercising the other rights and remedies
granted under this Lease.

    ___ [Initials of Landlord]         ______ [Initials of Tenant]


                                         -5-
<PAGE>

    (e)  In addition to the imposition of any late charge, any amount due to
Landlord, if not paid within f ive (5) days following the due date, will bear
interest from the due date until paid at the rate of ten percent (10%) per year
or, if a higher rate is legally permissible, at the highest rate legally
permitted. However, interest shall not be payable on late charges incurred by
Tenant nor on any amounts on which late charges are paid by Tenant to the extent
this interest would cause the total interest to be in excess of that legally
permitted. Payment of interest shall not excuse or cure any default by Tenant.

    (f)  All payments due shall be paid to Landlord, without deduction or
offset, in lawful money of the United States of America at Landlord's address
for notices under this Lease or to another person or at another place i n the
continental U.S. as Landlord may designate by written notice to Tenant.

    (g)  No security or guaranty which may now or hereafter be furnished to
Landlord for the payment of rent due hereunder or for the performance by Tenant
of the other terms of this Lease shall in any way be a bar or defense to any of
Landlord's remedies set forth in Sections 20, 21 or 22 hereof

    SECTION 5. ESCALATION RENT.   Escalation Rent shall be paid monthly on an
estimated basis, with subsequent annual reconciliation, in accordance with the
following procedures:

    (a)  No later than ninety (90) days prior to the end of the Base Year and
no later than ninety (90) days prior to the end of each subsequent year, or as
soon after that time as reasonably practicable, Landlord shall give Tenant
notice of Landlord's reasonable estimate of any Escalation Rent due under
Section 4(a) for the ensuing year. On or before the first day of each month
during the ensuing year, Tenant shall pay to Landlord one-twelfth (1/12th) of
the estimated Escalation Rent. If Landlord fails to give notice as required in
this Section, Tenant shall continue to pay on the basis of the prior year's
estimate until the month after that notice is given. If at any time it appears
to Landlord that the Escalation Rent for the current year will vary from the
estimate by more than f five percent (5%), Landlord shall, by notice to Tenant
setting forth in reasonable detail the basis for such adjustment, revise the
estimate for that year, and subsequent payments by Tenant for that year shall be
based on the revised estimate.

    (b)  Within ninety (90) days after the close of each year following the
Base Year, or as soon after the ninety (90) day period as reasonably
practicable, Landlord shall deliver to Tenant a statement of the actual
Escalation Rent for that year showing Operating Expenses and Property Taxes on
the basis of which the actual Escalation Rent was determined. At Tenant's
request, Landlord shall provide Tenant reasonable supporting detail underlying
the calculations of Operating Expenses and Property Taxes. If Landlord's
statement discloses that Tenant owes an amount that is less than the estimated
payments for that year previously made by Tenant, Landlord shall credit the
excess first against any sums then owed by Tenant, and then against the next
payments of rental due and, with respect to the final calendar year of the Term,
promptly refund such sums to Tenant. If Landlord's statement discloses that
Tenant owes an amount that is more than the estimated payments for that year
previously made by Tenant, Tenant shall pay the deficiency to Landlord within
thirty (30) days after delivery of the statement.

    (c)  The amount of Escalation Rent for any fractional year in the Term
shall be appropriately prorated. The proration of Escalation Rent for the
applicable year in which termination occurs shall be calculated on the basis of
a fraction of the Operating Expenses for that entire year and the proration of
Property Taxes for the year in which termination occurs shall be calculated on
the basis of a fraction of the Property Taxes for that entire year, but shall
exclude any Property Taxes attributable to any increase in the assessed
valuation of the Building occurring after


                                         -6-
<PAGE>

termination. The termination of this Lease shall not affect the obligations of
the parties pursuant to Section 5(b) to be performed afler the termination.

    SECTION 6. USE.     The Premises shall be used for general office purposes
and other uses reasonably ancillary thereto, but no other. Tenant shall not do
or permit to be done on the Premises, nor bring or keep or permit to be brought
or kept in the Premises, anything (a) which is prohibited by or in conflict with
any law, ordinance, or governmental rule or, (b) which is prohibited by the
standard form of fire insurance policy or, (c) which will increase the existing
rate of or affect fire or other insurance on the Building or its contents or
cause a cancellation of any insurance policy covering the Building or any part
of it or its contents. Tenant shall not use or store in the Premises any
hazardous or toxic substances, with the sole exception of reasonably necessary
substances that are kept in reasonably necessary quantities for normal office
operations, provided that their use and storage are in accordance with
applicable laws. Tenant shall not do or permit anything to be done on the
Premises that will unreasonably obstruct or interfere with the rights of other
tenants of the Building, or injure or annoy them, or use or allow the Premises
to be used for any unlawful purposes, nor shall Tenant cause, maintain, or
permit any nuisance or waste on or about the Premises.

    SECTION 7. SERVICES.

    (a)  Landlord shall maintain the public and common areas of the Building,
including lobbies, stairs, elevators, corridors, rest rooms, all exterior
landscaping, windows, the mechanical, plumbing, and electrical equipment serving
the Building, and the structure itself, in reasonably good order and condition
so as to meet the reasonable needs of Tenant, except for damage, excluding
normal wear and tear, caused by the Tenant. Damage by Tenant shall be repaired
by Landlord at Tenant's expense. The standard of maintenance shall be equal to
that of other office buildings of a similar class in the downtown San Francisco
area.

    (b)  Landlord shall furnish (i) electricity for lighting and the operation
of normal office machines, including personal computers, facsimile machines,
laser printers and photocopiers, (ii) heating and ventilation, to the extent
reasonably required for the comfortable occupancy by Tenant in Tenant's use of
the Premises during the period from 7:00 a.m. to 6:00 p.m. on weekdays ("NORMAL 
Business HOURS"), except holidays, or a shorter period as may be prescribed by
applicable policies or regulations adopted by any utility or governmental
agency, (iii) elevator service; provided that, Landlord may reasonably limit the
number of elevators to be operated before or after Normal Business Hours, (iv)
lighting replacement, for building standard lights, (v) rest room supplies, (vi)
window washing at least two (2) times a year, (vii) potable hot and cold water
for the rest rooms and kitchen areas, and (viii) daily janitor services during
the times and in the manner that these services are customarily furnished in
comparable office buildings in the downtown San Francisco area; provided,
however, that Landlord shall not be required to provide janitorial services for
portions of the Premises used for preparing or consuming food or beverages or
for similar purposes other than sweeping and refuse collection

    (c)  During times other than Normal Business Hours, Landlord shall furnish
the Premises with water, electricity and, upon twenty-four (24) hours' notice
from Tenant, reasonable heat and ventilation. Any such additional or different
utilities or services, including without limitation maintenance, repair,
janitorial and cleaning services that Landlord may agree to provide at Tenant's
request shall be at Tenant's sole expense. Tenant shall pay for heat and
ventilation furnished at Tenant's request during times other than Normal
Business Hours on an hourly basis at the then prevailing rate established for
the Building by Landlord. If the service requested by Tenant is not a
continuation of service furnished during Normal Business Hours, Tenant shall pay
for such service at such rate for a period of two (2) hours preceding the
commencement of services.


                                         -7-
<PAGE>

    (d)  If the temperature otherwise maintained in any portion of the Premises
by the heating, ventilating and air conditioning, if any, systems ("HVAC"), of
the Building is affected as a result of (a) any lights, machines or equipment
used by Tenant in the Premises, or (b) the occupancy of the Premises by more
than one person per 115 square feet of rentable area, Landlord shall have the
right to install any machinery or equipment that Landlord reasonably deems
necessary to restore temperature balance. Tenant shall pay the cost of
purchasing, installing, maintaining and operating any such equipment and
mod)fications. Landlord may establish reasonable measures to conserve energy and
water, including but not limited to, automatic light shut off after hours and
efficient lighting forms, so long as these measures do not unreasonably
interfere with Tenant's use of the Premises.

    (e)  Tenant shall advise Landlord prior to execution of this Lease and
within five (5) days afler written request therefor of the nature and quantity
of all of Tenant's lights, equipment and machines using electricity in the
Premises and shall permit Landlord or its authorized agents to make periodic
inspections of all facilities using electricity located within the Premises.

    (f)  If Landlord reasonably determines that Tenant's use of electricity, 
water or any other utility exceeds the building standard use of such utility, 
Landlord has the right to measure the amount of such excess use by any 
reasonable means (including the installation at Tenant's expense of a 
separate meter or other measuring device) and charge Tenant for the actual 
cost thereof. In accordance with Title 24 of the California Administrative 
Code, Building Standard electrical usage has been determined by Landlord to 
be: two (2) watts per square foot for lighting, and one ( 1 ) watt per square 
foot for all other electrical usage in the Premises, which may be subject to 
change from time to time based upon revisions to the California 
Administrative Code, and is based on the use during Normal Business Hours of 
typewriters, desk-top personal computers and other generally used office 
equipment generating comparable amounts of heat and using comparable amounts 
of electricity. If Landlord in its sole discretion permits Tenant to use in 
the Premises lighting in excess of two (2) watts per square foot or equipment 
or machinery using electricity in excess of one (1) watt per square foot, 
Tenant shall pay all the costs reasonably associated with such excess usage. 
In addition, Landlord may impose a reasonable charge for the use of any 
additional or unusual janitorial services required by Tenant because of the 
quality or type of Tenant's Improvements in the Premises, the carelessness of 
Tenant or the nature of Tenant's business (including hours of operation). All 
sums payable hereunder by Tenant for additional services or for excess 
utility usage shall be payable within 30 days of receipt of a written invoice 
from Landlord, provided that Landlord may require Tenant to pay monthly for 
the estimated cost of Tenant's additional services or excess utility usage if 
such usage occurs on a continual basis, and such estimated amounts shall be 
payable in advance on the first day of each month.

    (g)  Landlord shall not be in default under this Lease, nor be liable for
any damages resulting from, nor except as otherwise herein provided shall the
required rental be abated because of (i) the installation, use, or interruption
of use of any equipment in connection with furnishing the previously listed
services, (ii) failure to furnish or delay in furnishing these services, when
failure or delay is caused by accident or conditions beyond the reasonable
control of Landlord or by necessary repairs or improvements to the Premises or
to the Building, or (iii) the limitation, curtailment, rationing, or
restrictions on use of water, electricity, gas, or any other form of energy
serving the Premises or the Building. Landlord shall use reasonable efforts to
diligently remedy interruptions in the furnishing of these services. In the
event any governmental authority having jurisdiction over the Building
promulgates or revises any law, ordinance or regulation or building, or other
code or imposes mandatory or voluntary controls or guidelines on Landlord or the
Building relating to the use or conservation of energy or utilities or the
reduction of automobile or other emissions (collectively, "Controls") or in the
event Landlord is required or elects to make alterations to the Building in
order to comply with such mandatory or voluntary Controls, Landlord may, in its
sole discretion, comply with such Controls or make such alterations to the
Building related thereto. Such compliance and the making of such alterations
shall not constitute an eviction


                                         -8-
<PAGE>

of Tenant, constructive or otherwise, or impose upon Landlord any liability
whatsoever, including, but not limited to, liability for consequential damages
or loss of business by Tenant.

    (h)  Landlord shall not be obligated to provide or maintain any security
patrol or security system. However, if Landlord elects to provide such patrol or
system, Tenant shall comply with any such system implemented by Landlord, and
the cost thereof shall be included in Operating Expenses.

    (i)  Notwithstanding anything to the contrary contained in this Lease, if
at any time during the Term, if services to the Premises are interrupted such
that Tenant is reasonably prevented from using all or any portion of the
Premises, or Tenant is able to reasonably conduct its operations in all or any
portion of the Premises only at a significantly reduced level or under
materially adverse conditions ("Adverse Conditions") for any reason other than
the fault or neglect of Tenant, for a period of five (5) consecutive days
("Eligibility Period"), Base Rent and Escalation Rent shall abate commencing on
the date immediately following the Eligibility Period and continuing for the
time period and to the extent that Tenant's use of the Premises is adversely
affected. Further, if Adverse Conditions continue for ninety (90) consecutive
days, Tenant, at its option, may elect to terminate this Lease by giving written
notice to Landlord; provided that, if Landlord restores services to the Premises
within ten (10) days after receipt of Tenant's termination notice, Tenant's
exercise of its termination right shall be void. This shall not apply in the
event of any damage or destruction or condemnation of the Premises or the
Building, which damage or destruction or condemnation shall be governed by
Sections 12 and 25, respectively.

    SECTION 8. IMPOSITIONS. In addition to the monthly rental and other
charges to be paid by Tenant under this Lease, Tenant shall pay Landlord for all
of the following items (collectively, "IMPOSITIONS"): (i) taxes, other than
local, state, and federal personal or corporate income taxes measured by the net
income of Landlord; (ii) assessments, including without limitation, all
assessments for public improvements, services, or benefits, irrespective of when
commenced or completed; (iii) excises; (iv) levies; (v) business taxes; (vi)
license, permit, inspection, and other authorization fees; (vii) transit
development fees; (viii) assessments or charges for housing funds; (ix) service
payments in lieu of taxes and; (x) any other fees or charges that are levied,
assessed, confirrned, or imposed by a public authority; provided, however, that
Impositions shall not include amounts otherwise included in Operating Expenses
or Property Taxes. Tenant is obligated to pay only to the extent that the
Impositions are (a) on, measured by, or reasonably attributable to, the cost or
value of Tenant's equipment, furniture, fixtures, and other personal property
located in the Premises, or the cost or value of any above Building standard
leasehold improvements made to the Premises by or for Tenant, regardless of
whether title to the improvements shall be in Tenant or Landlord; (b) based on
or measured by the monthly rental or other charges payable under this Lease,
including without limitation, any gross receipts tax levied by a municipality,
the State of California, the Federal Government, or any other governmental body
with respect to the receipt of the rental; (c) based on the possession, leasing,
operation, management, maintenance, alteration, repair, use, or occupancy by
Tenant of the Premises or any portion of the Premises; or (d) on this
transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premises. If it is unlawful for Tenant to
reimburse Landlord for the Impositions, but lawful to increase the monthly
rental to take into account Landlord's payment of the Impositions, the monthly
rental payable to Landlord shall be revised to net Landlord the same net return
without reimbursement of the impositions as would have been received by Landlord
with reimbursement of the Impositions.

    SECTION 9. ALTERATIONS.

    (a)  Tenant shall not make or allow any alterations, additions, or
improvements to the Premises or any part of the Premises (collectively,
"ALTERATIONS"), without Landlord's prior written consent, which shall not be
unreasonably withheld. The installation of furnishings, fixtures,


                                         -9-
<PAGE>

equipment, or decorative improvements, none of which shall unreasonably affect
Building systems or the structure of the Building, and the repainting or
recarpeting of the Premises, shall not constitute Alterations. All Alterations
shall be made by Landlord for Tenant's account, including increased COSTS if
any, in accordance with the procedures set forth in this Section. All
Alterations shall immediately become Landlord's property and, at the end of the
Term, shall remain on the Premises without compensation to Tenant, unless
Landlord elects by notice to Tenant concurrently with Landlord' s approval of
the s same to have Tenant remove any Alterations that are peculiar to Tenant's
use of the Premises and are not normally required or used by other tenants. In
this event, Tenant shall bear the cost of restoring the Premises to their
condition prior to the installment of the Alterations. When plans and
specifications for any Alterations are approved by Landlord pursuant to Section
9(b), Landlord shall advise Tenant on request whether proposed Alterations would
entitle Landlord to require their removal and restoration of the Premises at the
end of the Term. Landlord may post and record an appropriate notice of
nonresponsibility with respect to any Alteration and Tenant shall maintain any
such notices posted by Landlord in or on the Premises. Notwithstanding the
foregoing to the contrary, provided that Hambrecht & Quist is Tenant hereunder,
Tenant may elect to directly contract for Alterations to be made to the
Premises, otherwise subject to compliance with all provisions of this Lease,
upon at least twenty (20) days' prior written notice to Landlord, and subject to
all other reasonable requirements Landlord may impose upon the making of such
Alterations, including without limitation the prior approval of any contractor
proposed by Tenant to make the Alterations.

    (b)  Plans and specifications for Alterations shall be prepared at Tenant's
expense by Landlord's architect, or by Tenant's architect if Tenant so requests
and Landlord consents, which consent shall be at Landlord's sole discretion, and
by engineers approved by Landlord, where the nature of the Alterations requires
mechanical or electrical engineering services. Any architect retained by Tenant
shall be instructed to follow standard construction administration procedures
and use standard specifications and details reasonably promulgated by Landlord
for the Building. The plans and specifications shall be subject to approval by
Landlord and Tenant, and shall not be unreasonably withheld or delayed by either
party. Plans and specifications that have neither been approved nor disapproved
by Landlord within thirty (30) days afler submittal by Tenant shall be deemed to
have been approved. Landlord does not warrant the cost of the Alterations, the
timeliness of performance, nor the quality of the contractor's work, but
Landlord shall use reasonable best efforts to secure performance of the
construction contract for Tenant's benefit. Notwithstanding the foregoing to the
contrary, provided that Hambrecht & Quist is Tenant hereunder, Landlord shall
not unreasonably withhold its consent to Tenant's designation of architects or
engineers

    (c)  In the event Tenant instructs Landlord or the contractor to proceed
with any changes to the Alterations without a prior determination of increased
costs resulting from those changes and without approval of the increases by
Tenant, or in the event Tenant is responsible for increased costs attributable
to a delay or acceleration in the time for construction, the amount of any
increased costs shall be reasonably determined by Landlord on completion of the
Alterations, subject only to Landlord's reasonable efforts in causing the
contractor to furnish Tenant appropriate back-up information concerning
increased costs, if any.

    (d)  The cost of the Alterations to be paid by Tenant shall include a
reasonable charge for the administration, by Landlord or an agent (not to exceed
five percent (5%) of the cost of the Alterat ions ), of the construction or
installation of the Alterations, the amount of which shall bear a reasonable
relationship to the scope of the Alterations and the costs of performing the
administration.

    (e)  Tenant shall pay to Landlord all amounts payable by Tenant pursuant to
this Section within thirty (30) days after billing by Landlord. Billing may be
in advance of or during the progress of the Alterations to enable Landlord to
pay the contractor, architect, or engineer without


                                         -10-
<PAGE>

advancing Landlord's own funds. At Tenant's request, Landlord shall, to the
extent practicable, furnish a cow of each bill to Tenant for Tenant's approval
at least ten ( 10) days prior to the due date of the bill. Tenant may contest
any payment to a contractor for Alterations and Landlord shall withhold this
payment, provided that the provisions of Section 10 are satisfied and Tenant
indemnifies and defends Landlord against all claims and liability arising out of
the contested payment. In the event that this Lease is assigned or all or any
part of the Premises is sublet (pursuant to all applicable requirements set
forth herein) and such assignee or sublessee wishes to make any Alterations to
the Premises, Landlord may, at Landlord's option and prior to commencement of
Alterations, require such assignee or sublessee to deposit with Landlord the
estimated cost of Alterations, or a lesser portion as specified by Landlord for
the cost as incurred. Any surplus funds shall be returned to such as s ignee or
subles see when the Alterations have been paid for in full.

    (f)  Landlord may delegate some or all authority and responsibilities under
this Section to a manager.

    SECTION 10.    LIENS     Tenant shall keep the Premises and the Building 
free any liens arising out of any work performed, materials furnished, or 
obligations incurred by or at the request of Tenant. Landlord may have posted 
on the Premises any notices that may be provided by law or that Landlord may 
deem proper for the protection of Landlord, the Premises, and the Building 
from those liens. If any such liens are filed, Landlord may, upon thirty (30) 
days' written notice to Tenant, without waiving its rights based on such 
breach by Tenant and without releasing Tenant from any obligations hereunder, 
pay and satisfy the same and in such event the sums so paid by Landlord shall 
be due and payable by Tenant immediately without notice or demand, with 
interest from the date paid by Landlord through the date Tenant pays 
Landlord, at the interest rate otherwise payable hereunder pursuant to 
Section 4(e). Notwithstanding, Tenant may contest any lien for which Tenant 
is responsible under this Section, provided that Tenant shall have caused the 
lien to be bonded against to the reasonable satisfaction of Landlord.

    SECTION 11.    REPAIRS.  Tenant accepts the Premises as being in the
condition in which Landlord is obligated to deliver the Premises, subject to the
tenant improvements, if any, that Landlord has agreed to make, and casualty
damage. At all times during the term of this Lease and at Tenant's sole cost,
Tenant shall keep the Premises (specifically excluding any structural portions
of the Building therein) in good condition and repair; ordinary wear and tear
and damage to the Premises by fire, earthquake, or act of God or the elements
are excepted. Tenant waives all rights to make repairs at the expense of
Landlord or instead to vacate the Premises, and Tenant further waives the
provisions of Civil Code Sections 1941 and 1942 with respect to Landlord's
obligations under this Lease. At the end of the term of this Lease, Tenant shall
surrender to Landlord the Premises and all Alterations that are to remain in the
Premises in the same condition as when received; ordinary wear and tear and
damage by fire, earthquake, or act of God or the elements are excepted. Landlord
has no obligation and has made no promise to alter, remodel, improve, repair,
decorate, or paint the Premises or any part of them, except as specifically set
forth in this Lease. Landlord has made no representations respecting the
condition of the Premises or the Building, except as specifically set forth in
this Lease.

    SECTION 12.    DAMAGE OR DESTRUCTION.

    (a)  In the event the Premises or any portion of the Building necessary for
Tenant's occupancy are damaged by fire, earthquake, act of God, the elements, or
other casualty, within sixty (60) days after that event, Landlord shall notify
Tenant of the estimated time, in Landlord's reasonable judgment, required for
repair or restoration. If the estimated time is one hundred and eighty (180)
days or less after the commencement of the physical work and one (1) year or
less after the casualty event, Landlord shall proceed promptly and diligently to
adjust the loss with applicable insurers, to secure all required governmental
permits and approvals, and to repair or


                                         -11-
<PAGE>

restore the Premises or the portion of the Building necessary for Tenant's
occupancy. This Lease shall remain in full force, except that for the time
unusable, Tenant shall receive a rental abatement for that part of the Premises
rendered unusable in the conduct of Tenant's business.

    (b)  If the estimated time for repair or restoration is in excess of one
hundred and eighty (180) days after the commencement of the physical work or one
(1) year after the casualty event, Tenant may elect to terminate this Lease as
of the date of the casualty event by giving notice to Landlord within fiReen
(15) days following receipt of Landlord's notice of the estimated time for
repair.  If the estimated time is more than one hundred and eighty (180) days
after commencement of the physical work or one (1) year after the casualty
event, but Tenant has not elected to terminate this Lease, Landlord may elect,
on notice to Tenant within twenty (20) days after the period for Tenant's
election to terminate has expired. to repair or restore the Premises or the
portion of the Building necessary for Tenant's occupancy. In that event, this
Lease shall continue in full force, but the rent shall be abated. If Landlord
does not elect to repair or restore, this Lease shall terminate as of the date
of the casualty event. However, if Landlord has not commenced the physical
repair or restoration of the Premises or the portion of the Building necessary
for Tenant's occupancy within one (1) year from the casualty event, Tenant may
elect to terminate this Lease by notice to Landlord given at any time following
the expiration of one (1) year from the casualty event, but prior to the
commencement of the physical repair or restoration work.

    (c)  If the Premises or the Building are to be repaired or restored under
this Section, Landlord shall repair or restore at Landlord's cost the Building
itself and all improvements in the Premises, including but not limited to, any
tenant improvements constructed pursuant to this Lease or otherwise installed
within the Premises as of the date of this Lease, but excluding Alterations made
by or for Tenant subsequent to completion of those tenant improvements. Tenant
shall pay the cost of repairing or restoring any Alterations made by or for
Tenant and shall be responsible for carrying casualty insurance as Tenant deems
appropriate for those Alterations.

    (d)  In the event of any damage to or destruction of the Premises or the
Building, Landlord and Tenant acknowledge that their respective rights and
obligations are to be governed exclusively by this Lease.

    (e)  In the event the Premises are to be repaired or restored and Tenant
requires temporary offices as a result of a casualty event affecting the
Premises, Landlord shall use best efforts to locate offices for Tenant within
the Building.  Tenant acknowledges that Landlord makes no commitment as to the
availability of any offices or as to their cost.

    SECTION 13.    SUBROGATION.   Landlord and Tenant shall each obtain from
their respective insurers under all policies of fire, theft, public liability,
worker's compensation, and other insurance maintained during the term of this
Lease covering the Building, or any portion of it, or operations in it, a waiver
of all rights of subrogation that the insurer of one party might have against
the other party. Landlord and Tenant shall each indemnify the other against any
loss or expense, including reasonable attorney fees, resulting from the failure
to obtain this waiver.

    SECTION 14.    INDEMNIFICATION.    Tenant waives all claims against
Landlord for damage to any property or injury or death of any person on the
Premises arising at any time and from any cause other than the gross negligence
or willful misconduct of Landlord or Landlord's employees, agents, or
contractors. Tenant shall hold Landlord harmless from and defend Landlord
against all claims, liability, damage, or loss arising out of any injury or
death of any person or damage to or destruction of property attributable to the
use of the Premises by Tenant, except that caused by the gross negligence or
willful misconduct of Landlord or Landlord's agents, contractors, or employees.
Tenant shall also hold Landlord harmless from any liability, cost, or expense
arising from Tenant's use or storage in the Premises of any hazardous or toxic
substance. Landlord shall hold Tenant harmless from and defend Tenant against
all claims, liability, damage,


                                         -12-
<PAGE>

or loss arising out of any injury or death to any person or damage to or
destruction of property attributable to the use of the Building (but not the
Premises) by Landlord, except that caused by Tenant or Tenant's agents,
contractors, or employees. Landlord shall also hold Tenant harmless from any
liability, cost or expense arising out of the release, deposit or presence of
hazardous or toxic substances which are in the Premises or the Building not
attributable to Tenant's or its assignees', sublessees', licensees', invitees',
employees', guests', agents' or contractors' use or occupation of the Premises
and the Building. These indemnity obligations shall include reasonable attorney
fees, investigation costs, and all other reasonable costs incurred by the
indemnified party from the first notice that any claim or demand is to be made
or may be made. The indemnified party shall promptly give notice to the
indemnifying party of any claim or demand. The provisions of this Section shall
survive the termination of this Lease for any event occurring prior to the
temination. The provisions of this Section to indemnify and hold a party
harmless are limited to the amount of loss that is not paid to s u ch party out
of insurance proceeds, if any.

    SECTION 15.    COMPLIANCE WITH LEGAL REQUIREMENTS.     At Tenant's sole
cost, Tenant shall promptly comply with all laws and governmental rules now or
later in force, including but not limited to, the American with Disabilities
Act, as may be amended from time to time; with the requirements of any board of
fire underwriters or other similar body now or in the future constituted; and
with any direction or occupancy certificate issued by public officers (the
"LEGAL REQUIREMENTS"), insofar as they relate to the condition, use, or
occupancy of the Premises. Excluded are (a) structural changes or changes to the
electrical, mechanical, or plumbing systems of the Building, all to the extent
not necessitated by Tenant's acts or by improvements made for Tenant; (b)
alterations or improvements to the Building as a whole or to the Premises of
tenants generally that are not by law the tenants' responsibility with which to
comply; and (c) work necessitated by defects in the construction of the
Building. Tenant shall immediately furnish Landlord with any notices received
from any insurance company or governmental agency or inspection bureau regarding
any unsafe or unlawful conditions within the Premises. Landlord shall comply in
a timely manner with all Legal Requirements that are not Tenant's responsibility
under this Section to the extent noncompliance would adversely affect Tenant's
use or occupancy of the Premises. Tenant agrees that Tenant shall not
discriminate against or segregate any person or group of persons on account of
race, sex, CREED, color, marital status, sexual preference, national origin, or
ancestry, in the occupancy, use, sublease, tenure, or enjoyment of the Premises.
The provisions of this Section 15 are for the benefit of Landlord only and are
not nor shall they be construed to be for the benefit of any tenant or occupant
of the Building.

    SECTION 16.    ASSIGNMENT AND SUBLETTING.

    (a)  Except as otherwise expressly permitted by this Lease, Tenant shall
not, without the prior written consent of Landlord, which shall not be
unreasonably withheld or delayed, voluntarily or involuntarily, assign or
hypothecate this Lease or any interest in this Lease, sublet the Premises or any
part of them, or license the use of the Premises by any party other than Tenant.
Any of the previous acts without consent shall be void and shall, at the option
of Landlord, constitute a noncurable default under this Lease. In connection
with each consent requested by Tenant, Tenant shall submit to Landlord the terms
of the proposed transaction, the identity of the parties to the transaction, the
proposed documentation for the transaction, and all other information reasonably
requested by Landlord concerning the proposed transaction and the parties
involved. Tenant agrees that any instrument by which Tenant assigns or sublets
all or any portion of the Premises shall expressly provide that the subtenant or
assignee may not further assign or sublet the assigned or sublet space without
Landlord's prior written consent as provided herein, and that the assignee or
subtenant will assume and comply with all of the provisions of this Lease and
that Landlord may enforce the Lease provisions directly against such assignee or
subtenant. For purposes of this Section 16, the following events shall be deemed
an assignment or sublease, as appropriate: (i) the issuance of equity interests
(whether stock, partnership interests or otherwise) in Tenant or any subtenant
or assignee, or any entity controlling any of them, to any person or


                                         -13-
<PAGE>

group of related persons, in a single transaction or a series of related or
unrelated transactions, such that, following such issuance, such person or group
shall have Control (as defined below) of Tenant; or (ii) a transfer of Control
of Tenant or any subtenant or assignee, or any entity controlling any of them,
in a single transaction or a series of related or unrelated transactions
(including without limitation, by consolidation, merger, acquisition or
reorganization), except that the transfer of outstanding capital stock or other
listed equity interests by persons or parties other than "insiders" within the
meaning of the Securities Exchange Act of 1934, as amended, through the
"over-the-counter" market or any recognized national or interantional securities
exchange, shall not be included in determining whether Control has been
transferred. "Control" shall mean direct or indirect ownership of fifty percent
(50%) or more of all of the voting stock of such corporation or fifly percent
(50%) or more of all the legal and equitable interest in any other business
entity. However, Tenant may, without resulting in a default under this Lease and
without notice to Landlord, license the use of the Premises by (i) any entity of
which Tenant, any of Tenant's subsidiaries, or Tenant's parent is a limited
partner, general partner, joint venturer, or shareholder; (ii) any other limited
partner, general partner, joint venturer or shareholder in that entity; (iii)
any consultant, contractor, accountant, or counsel of Tenant; or (iv) any of the
directors, officers, employees, contractors, accountants, or counsel of any of
the foregoing. The license or other permitted use does not in any way create in
the licensee or any other party rights to possess or remain in the Premises
beyond the termination of the Lease.

    (b)  Without limiting other instances in which Landlord may reasonably
withhold consent to an assignment or subletting, Landlord and Tenant acknowledge
that it shall be reasonable for Landlord to withhold consent in the following
instances:

         (i) if at the time consent is requested or at any time prior to the
granting of consent, an Event of Default has occurred under this Lease or if
Tenant is in monetary default under this Lease or would be in monetary default
under this Lease but for the pendency of any grace or cure period under Section
19, if any;

         (ii) if the proposed assignee or sublessee is a governmental agency;

         (iii) if, in Landlord's reasonable judgment, use of the Premises by
the proposed assignee or sublessee would not be comparable to the of fice use by
other tenants in the Building, would entail alterations that would materially
lessen the value of the leasehold improvements in the Premises (unless Tenant
provides adequate security to ensure that the Premises will be restored to their
prior condition pursuant to Section 9(a)), would result in more than a
reasonable number of occupants per floor, or would require substantially
increased services by Landlord;

         (iv) if Landlord reasonably determines that circumstances warrant a
consideration of the financial worth of a proposed assignee or sublessee, and
the financial worth, in Landlord's reasonable judgment, does not meet the credit
standards applied by Landlord for other tenants under leases with comparable
terms; and

         (v) if, in Landlord's reasonable judgment, the character, reputation,
or business of the proposed assignee or sublessee is not consistent with the
quality of the other tenancies in the Building.

    (c)  If at any time during the Term, Tenant desires to sublet all or any
part of the Premises, Tenant shall notify Landlord of the terms of the proposed
subletting and the space proposed to be sublet. Landlord shall have the option,
exercisable by notice given to Tenant within thirty (30) days afler Tenant's
notice is given, or within five (5) days afler Tenant's notice is given if
Tenant submits terms that have already been negotiated with a specific proposed
sublessee, if the proposed subletting is for all or any part of the Premises for
a sublet term ending within the last year of the Term, to terminate this Lease
with respect to all or that portion of the Premises


                                         -14-
<PAGE>

proposed to be sublet. If Landlord does not exercise this option, Tenant shall
be free to sublet the space to any third parry or to the specific proposed
sublessee, at the same rental and on substantially the same terms in the notice
given to Landlord, subject to obtaining Landlord's prior consent as provided
previously.

    (d)  No sublessee shall have a right to further sublet without Landlord's
prior consent, which Tenant acknowledges may be withheld in Landlord's absolute
discretion (provided, however, that Landlord shall not unreasonably withhold its
consent to a proposed sub-sublease by the direct sublessee of the Tenant named
herein), and any assignment by a sublessee of the sublease shall be subject to
Landlord's prior consent in the same manner as if Tenant were entering into a
new sublease. No sublease, once consented to by Landlord, shall be mod)fied or
terminated by Tenant without Landlord's prior consent, which shall not be
unreasonably withheld.

    (e)  In the case of an assignment, one-half (1/2) of any sums or other
economic consideration received by Tenant as a result of the assignment
(excluding any consideration reasonably attributed to asses other than this
Lease) shall be paid to Landlord afler first deducting the unamortized cost of
leasehold improvements paid for by Tenant, and the cost of any real estate
commissions, reasonable attorney fees, or other third party professional
services paid by Tenant in connection with the assignment.

    (f)  In the case of a subletting, one-half ( 1/2) of any sums or economic
consideration received by Tenant as a result of the subletting shall be paid to
Landlord afler fimt deducting (i) the rental due under this Lease, prorated to
reflect only rental allocable to the sublet portion of the Premises, (ii) the
cost of leasehold improvements made to the sublet portion of the Premises at
Tenant's cost, amortized over the term of this Lease, except for leasehold
improvements made for the specific benefit of the sublessee, which shall be
amortized over the term of the sublease, and (iii) the cost of any real estate
commissions, reasonable attorney fees, or other third party professional
services paid by Tenant in connection with the subletting.

    (g)  Regardless of Landlord's consent, no subletting or assignment shall
release or alter Tenant's obligation or primary liability to pay the rental and
perform all other obligations under this Lease. The acceptance of rental by
Landlord from any other person shall not be deemed a waiver by Landlord of any
provision of this Lease. Consent to one assignment or subletting shall not be
deemed consent to any subsequent assignment or subletting. In the event of
default by any assignee or successor of Tenant in the performance of any of the
semis of this Lease, afler notice of default to Tenant pursuant to Section 19
and the expiration of any applicable cure period, Landlord may proceed directly
against Tenant without the necessity of exhausting remedies against the assignee
or successor. Landlord may consent to subsequent assignments or subletting of
this Lease or amendments or mod)fications to this Lease with assignees of
Tenant, without notifying Tenant, or any successor of Tenant, and without
obtaining consent. This action shall not relieve Tenant of liability under this
Lease provided, however, that Tenant shall not be liable for any increase in
Tenant's obligations under this Lease because of any amendment or mod)fication
to this Lease, unless Tenant has consented to it in writing. Further, no
permitted subletting by Tenant shall be effective until there has been delivered
to Landlord a counterpart of the sublease in which the subtenant agrees to be
and remain jointly and severally liable with Tenant for the payment of rent
pertaining to the sublet space and for the performance of all of the terms and
provisions of this Lease; provided, however, that the subtenant shall be liable
to Landlord for rent only in the amount set forth in the sublease. No permitted
assignment shall be effective unless and until there has been delivered to
Landlord a counterpart of the assignment in which the assignee assumes all of
Tenant's obligations under this Lease arising on or after the date of the
assignment. The failure or refusal of a subtenant or assignee to execute any
such instrument shall not release or discharge the subtenant or assignee from
its liability as set forth above.


                                         -15-
<PAGE>

    (h)  If Tenant assigns this Lease, sublets the Premises, or requests the
consent of Landlord to any assignment, subletting, hypothecation, or other
action requiring Landlord's consent under this Lease, Tenant shall pay
Landlord's reasonable attorney fees incurred in connection with the action., not
to exceed $2,500.

         (i)    Sections 16(a), 16(b), 16(c), 16(e) and 16(f) shall not apply
to any license or sharing of space by Tenant within the Premises to the
following persons or entities and their respective employees and affiliates: (i)
Paul Pelosi; (ii) Burrill & Company; (iii) Doyle & Boisseire; (iv) Fletcher
Asset Management; and (v) George Stathakis; provided that such sharing or
licensing of space conforms to the following: the licensed or shared area is, in
the aggregate, less than forty-nine percent (49%) of the rentable area of the
Premises (within which the foregoing licenses may expand or contract as Tenant
deems appropriate); Tenant continues to occupy at least fifty-one percent (51%)
of the rentable area of the Premises; and the rent or other compensation paid by
such licensees to Tenant for the use of the Premises shall in no event be in
excess of the applicable pro rata share (based on the square footage of the
Premises used or occupied by such Licensee) of the Rent and the Escalation Rent
payable by Tenant hereunder. All other provisions of Section 16 not specifically
excluded under this Section 16 shall be applicable to any licensing or sharing
of the Premises. The rights of Tenant under this Section 16(i) is personal to
Hambrecht & Quist.

    (j)  Notwithstanding anything contained in this Section 16 to the contrary,
as long as no Event of Default then exists with respect to the payment when due
of rent, Tenant shall have the right, subject to the terms and conditions
hereinafter set forth, without the consent of Landlord but upon at least thirty
(30) days prior written notice to Landlord, to do the following:

         (i)    Assign its interest in this Lease to (i) any corporation which
is a successor to Tenant either by merger or consolidation, (ii) a purchaser of
all or subsequently all of Tenant's assets (provided such purchaser shall have
also assumed substantially all of Tenant's liabilities), or (iii) a corporation,
partnership or other entity which shall control, be under the control of, or be
under common control with, Tenant (the term "control" as used herein shall be
deemed to mean ownership, directly or indirectly, of more than fifty percent
(50%) of the outstanding voting stock of a corporation, or other majority equity
and control interest if Tenant is not a corporation) (any such entity being a
"Permitted Transferee"); or

         (ii)   Sublease all or any portion of the Premises to a Permitted
Transferee upon the condition that the Permitted Transferee shall occupy and use
the Premises in a manner consistent with the terms and conditions of this Lease.

         Tenant shall, within ten (10) business days after execution thereof,
deliver the following to Landlord:

         (iii)  A duplicate original instrument of assignment in form and
substance reasonably satisfactory to Landlord, duly executed by Tenant and the
assignee in which the assignee shall expressly agree to assume, observe,
perform, and be bound by all of the terms, covenants and conditions of this
Lease on Tenant's part to be observed and performed; or

         (iv)   A duplicate original sublease in form and substance reasonably
satisfactory to Landlord, duly executed by Tenant and the subtenant.

    SECTION 17. RULES   Tenant shall comply with the rules attached to and
incorporated in this Lease as Exhibit B, and afler notice, with all reasonable
modifications and additions to these rules, from time to time promulgated in
writing by Landlord. Landlord shall not be responsible to Tenant for the
nonperformance of any of these rules by any other tenant or occupant of the
Building, but Landlord shall take reasonable steps to enforce any rules, the
nonperformance of which by other tenants materially and adversely affects Tenant
in the use of the However, if any


                                         -16-
<PAGE>

rule conflicts with any term, covenant, or condition of this Lease, this Lease
shall prevail. In addition, no rule, or any subsequent amendment to it adopted
by Landlord shall alter, reduce, or adversely affect any of Tenant's rights or
enlarge Tenant's obligations under this Lease.

    SECTION 18. ENTRY BY LANDLORD.     Landlord may enter the Premises at
reasonable hours and, except in the event of an emergency, on reasonable prior
notice, to (a) inspect the Premises; (b) exhibit the Premises to prospective
purchasers, lenders, or tenants; (c) determine whether Tenant is complying with
all obligations under this Lease; (d) supply janitorial service and any other
services to be provided by Landlord under this Lease; (e) post notices of
nonresponsibility; and (f) make repairs or perform maintenance required of
Landlord by this Lease, make repairs to any adjoining space or utility services,
or make repairs, alterations, or improvements to any other portion of the
Building.  However, all this work shall be done as promptly as reasonably
possible and cause as little interference to Tenant as reasonably possible.
Subject to Landlord's undertakings in the previous sentence, Tenant waives any
damage claims for inconvenience to or interference with Tenant's business or
loss of occupancy or quiet enjoyment of the Premises caused by Landlord's entry.
At all times Landlord shall have a key with which to unlock the doors on the
Premises, excluding Tenant's vaults, safes, and similar areas designated as
secure areas in writing by Tenant in advance. In an emergency, Landlord shall
have the right to use any means that Landlord deems proper to open Tenant's
doors and enter the Premises. Entry to the Premises by Landlord in an emergency
shall not be construed as a forcible or unlawful entry, a detainer, or an actual
or constructive eviction of Tenant.

    SECTION 19. EVENTS OF DEFAULT      The following events shall constitute
events of default under this Lease (each, an "Event of Default"):

    (a)  a default by Tenant in the payment when due of any rent or other sum
payable under this Lease, provided, however, that Landlord agrees to provide
Tenant once during the Term a written courtesy notice of Tenant's failure to pay
rent when due hereunder, by which Tenant shall have three (3) days after receipt
of such notice to pay such overdue rent before delivery of any statutorily
required notice is given by Landlord seeking forfeiture of the Lease;

    (b)  a default by Tenant in the performance of any of the terms, covenants,
agreements, or conditions in this Lease, other than a default by Tenant in the
payment when due of any rent or other sum payable under this Lease, and the
continuation of the default beyond thirty (30) days after notice by Landlord or,
if the default is curable and would require more than thirty (30) days to
remedy, beyond the time reasonably necessary for cure;

    (c)  the bankruptcy or insolvency of Tenant, a transfer by Tenant in fraud
of creditors, an assignment by Tenant for the benefit of creditors, or the
commencement of proceedings of any kind by or against Tenant under the Federal
Bankruptcy Act or under any other insolvency, bankruptcy, or reorganization act,
unless Tenant is discharged from voluntary proceedings within ninety (90) days;

    (d)  the appointment of a receiver for a substantial part of Tenant's
assets;

    (e)  the abandonment of the Premises; and

    (f)  the levy upon this Lease or any estate of Tenant under this Lease by
attachment or execution and the failure to have the attachment or execution
vacated within thirty (30) days.

    SECTION 20. TERMINATION UPON DEFAULT    On occurrence of any Event of
Default by Tenant, Landlord may, in addition to any other rights and remedies
given here or by law, terminate this Lease and exercise remedies relating to it
without further notice or demand in accordance with the following provisions:


                                         -17-
<PAGE>

    (a)  So long as the Event of Default remains uncured, Landlord shall have
the right to give notice of termination to Tenant, and on the date specified in
this notice, this Lease shall terminate.

    (b)  If this Lease is terminated, Landlord may, by judicial process,
reenter the Premises, remove all persons and property, and repossess and enjoy
the Premises, all without prejudice to other remedies that Landlord may have
because of Tenant's default or the termination.

    (c)  If this Lease is terminated, Landlord have all of the rights and
remedies of a landlord provided by Civil Code Section 1951.2, in addition to any
other rights and remedies Landlord may have. The damages which Landlord may
recover shall include, without limitation, (i) the worth at the time of award of
the unpaid rent which had been earned at the time of termination; (ii) the worth
at the tune of award of the amount by which the unpaid rent which would have
been earned after termination until the time of the award exceeds the amount of
the rental loss that Tenant proves could have been reasonably avoided; (iii) the
worth at the time of award computed by discounting the amount at the discount
rate of the Federal Reserve Bank of San Francisco at the time of award plus one
percent (1%) of the amount by which the unpaid rent for the balance of the term
after the time of award exceeds the amount of rental loss that Tenant proves
could be reasonably avoided; (iv) all reasonable legal expenses and other
related costs incurred by Landlord following Tenant's default; (v) all
reasonable costs incurred by Landlord in restoring the Premises to good order
and condition to relet the Premises; and (vi) all reasonable costs, including
without limitation, any brokerage commissions incurred by Landlord in reletting
the Premises.

    SECTION 21.    CONTINUATION AFTER DEFAULT.   If Tenant breaches this Lease
and abandons the Premises, this Lease shall continue in effect for so long as
Landlord does not terminate Tenant's right to possession, and Landlord may
enforce all rights and remedies under this Lease, including the right to recover
the rental as it becomes due under this Lease. Acts of maintenance or
preservation, efforts to relet the Premises, or the appointment of a receiver
upon initiative of Landlord to protect Landlord's interest under this Lease
shall not constitute a termination of Tenant's right to possession.

    SECTION 22  OTHER RELIEF.     The remedies provided in this Lease are in
addition to any other remedies available to Landlord at law, in equity, by
statute, or otherwise.

    SECTION 23.    RIGHT OF LANDLORD TO CURE DEFAULTS.     Agreements and
provisions to be performed by Tenant under this Lease shall be at Tenant's sole
cost and without abatement of rental, except as specifically provided in this
Lease. If Tenant (a) fails to pay any sum of money, other than rental, required
under this Lease, or (b) fails to perform any other act under this Lease, and
this failure continues for thirty (30) days after notice of the failure by
Landlord, or a longer period as may be allowed under this Lease, Landlord may,
without waiving or releasing Tenant from any obligations of Tenant, make payment
or perform other acts required by this Lease on Tenant's behalf. All sums paid
by Landlord and all necessary incidental costs shall be payable to Landlord on
demand and shall constitute additional rental under this Lease.

    SECTION 24.    ATTORNEY FEES.      If, as a result of a breach or default
under this Lease, Landlord or Tenant uses an attorney to secure compliance with
Lease provisions, to recover damages, to terminate this Lease, or to evict
Tenant, as applicable, the non-prevailing party shall reimburse the prevailing
party, on demand, for all reasonable attorney fees and expenses incurred by the
prevailing party, and if such prevailing parry shall recover judgment in
connection therewith, such fees and expenses shall be included in and as a part
of such judgment. As used herein, the term "prevailing party" shall mean that
party who substantially prevails on its claim, regardless of whether such claim
is prosecuted to judgment. If any action or proceeding between Landlord and
Tenant to enforce the provisions of this Lease (including an action or
proceeding


                                         -18-
<PAGE>

between Landlord and the trustee or debtor in possession while Tenant is a
debtor in a proceeding under any bankruptcy law) proceeds to trial, Landlord and
Tenant hereby waive their respective rights to a jury in such trial.

    SECTION 25.    EMINENT DOMAIN.

    (a)  If all or any part of the Premises shall be either taken or condemned
for any public or quasi-public use or purpose, or transferred by agreement in
connection with any public or quasi-public use or purpose with or without any
condemnation action or proceeding being instituted (either such event herein
called a "TAKING"), and if such Taking is permanent the Term shall automatically
terminate with respect to the part of the Premises so Taken as of the date when
the possession of such part is required. If all or any portion of the Premises
is subject to a temporary Taking, this Lease shall remain in full force and
effect and Tenant shall continue to perform all terms, conditions and covenants
of this Lease. If a portion of the Premises or Building is taken so as to
require, in Landlord's reasonable judgment, a substantial alteration or
reconstruction of the remaining portions, Landlord, at its sole election, may
terminate this Lease as of the date when possession of the part so Taken is
required. Without obligation to Tenant, Landlord may agree to transfer to any
condemnor all or any portion of the Building sought by such condemnor, free from
this Lease and the rights of Tenant hereunder, without first requiring that any
action or proceeding be instituted or, if instituted, pursued to a judgment.

    (b)  Landlord shall be entitled to the entire award made to it for any
Taking, provided, however, that: (a) Landlord shall have no interest in any
award made to Tenant specifically for its relocation expenses, the Taking of
personal property or fixtures belonging to Tenant, or the interruption of or a
damage to Tenants business, if any such award is made separately to Tenant and
not as a part of an award or damages recoverable by Landlord, and (b) Tenant
shall be entitled to receive the entire award made in connection with any
temporary Taking allocable to the period prior to the expiration of the Term

    (c)  Landlord and Tenant hereby waive the provisions of California Code of
Civil Procedure Section 1265.130 to the extent that such provisions are
inconsistent with this Lease.

    SECTION 26  INSURANCE.

    (a)  Tenant, at is expense, shall maintain in full force during the term a
policy or policies of commercial general insurance insuring against all
liability of Tenant and its representatives and visitors for personal or bodily
injury or property damage arising out of or incurred in connection with Tenant's
use or occupancy of the Premises or the Building. Such policy or policies shall
further insure the indemnification obligations of Tenant under this Lease.

    (b)  Tenant shall at all times maintain in effect insurance with respect to
its alterations, trade fixtures and other personal property at the Premises
providing coverage against fire, extended coverage perils and vandalism and
malicious mischief, to the extent of at least eighty percent (80%) of the full
replacement cost thereof. Tenant may carry such insurance under a blanket
policy, provided that such policy provides equivalent coverage to a separate
policy. During the Term the proceeds from any such policies of insurance shall
be used for the repair or replacement of such property so insured. Landlord
shall have no interest in such insurance and shall sign all documents reasonably
necessary or proper in connection with the settlement of any claim or loss by
Tenant.

    (c)  Each policy of insurance required under this Lease shall h in an
amount specified in the Basic Lease Information and in a form, and with an
insurer reasonably acceptable to Landlord, and shall require at least thirty
(30) days' (or, in case of nonpayment of premium, ten (10) days') written notice
to Landlord and any baneficiary of any deed of trust covering the Building prior
to any termination or material alteration of the policy and shall provide that
no act or omission of


                                         -19-
<PAGE>

Tenant shall affect or limit the obligations of the insurer with respect to any
other insured. Each policy of liability insurance shall name Landlord and its
property manager and any baneficiary of any deed of trust covering the Building
as additional insureds and provide that it is primary to, and not contributing
with, any policy carried by Landlord covering the same loss. Tenant shall
provide to Landlord prior to the Commencement Date and upon request thereafter
evidence that the insurance required to be carried by Tenant pursuant to this
Section is in full force and effect and the premiums therefor have been paid.
Not more frequently than once every two (2) years, Tenant shall increase the
amounts of insurance as reasonably recommended by Landlord's lender or insurance
broker if, in the reasonable opinion of either of them, the amount of insurance
then required under this Lease is not adequate. Any limits set forth in the
Lease on the amount or type of coverage required by Tenant's insurance shall not
limit the liability of Tenant under this Lease.

    (d)  In the event that, as a result of changed circumstances from time to
time, comparable landlords and/or tenants in the area in which the Building is
located are typically carrying kinds or amounts of insurance that exceed the
requirements of this Lease, Tenant shall, within thirty (30) days following
written demand by Landlord, obtain and thereafter maintain in effect such
additional insurance, which shall, to the extent reasonably applicable, conform
to, and be governed by, the existing insurance provisions of this Lease.

    (e)  Landlord shall at all times maintain in effect casualty and commercial
general liability insurance with respect to the Building and other improvements
located on the Property (excluding any items to be insured by Tenant pursuant to
Section 26(b)) and commercial general liability insurance regarding the
operations thereon in amounts and with coverage Landlord deems commercially
practicable or typically carried by comparably situated landlords of comparable
buildings in downtown San Francisco.

    SECTION 27.    SUBORDINATION.      This Lease shall be subordinate to any
ground lease, mortgage, deed of trust, or any other hypothecation for security
now or later placed upon the Building and to any advances made on the security
of it or Landlord's interest in it, and to all renewals, mod)fications,
consolidations, replacements, and extensions of it.  However, if any mortgagee,
trustee, or ground lessor elects to have this Lease prior to the lien of its
mortgage or deed of trust or prior to its ground lease, and gives notice of that
to Tenant, this Lease shall be deemed prior to the mortgage, deed of trust, or
ground lease, whether this Lease is dated prior or subsequent to the date of the
mortgage, deed of trust, or ground lease, or the date of recording of it. In the
event any mortgage or deed of trust to which this Lease is subordinate is
foreclosed or a deed in lieu of foreclosure is given to the mortgagee or
baneficiary, Tenant shall attorn to the purchaser at the foreclosure sale or to
the grantee under the deed in lieu of foreclosure, provided such parties agree
to recognize Tenant's interest in this Lease. In the event of termination of any
ground lease to which this Lease is subordinate, Tenant shall attorn to the
ground lessor. Tenant agrees to execute any documents, in form and substance
reasonably acceptable to Tenant, required to effectuate the subordination, to
make this Lease prior to the lien of any mortgage or deed of trust or ground
lease, or to evidence the attornment. At Tenant's request, Landlord shall use
its reasonable efforts to obtain, from time to time, a nondisturbance agreement
from any existing holder of a deed of trust covering the Building and from any
future holdes of deeds of trust covering the Building, in a form and substance,
satisfactory to such holders.

    SECTION 28.    NO MERGER.     The surrender of this Lease by Tenant, or a
mutual cancellation of it, shall not work a merger and shall, at the option of
Landlord, terminate all or any existing subleases or subtenancies or operate as
an assignment to Landlord of all subleases or subtenancies.

    SECTION 29.    SALE.   In the event that Landlord or any successor owner 
of the Building sells or conveys the Building, all liabilities and 
obligations of Landlord or the successor owner under this Lease accruing 
after the sale or conveyance terminates, shall be binding on the new

                                         -20-
<PAGE>


owner, and Tenant shall release Landlord from all liability under this Lease
accruing after the date of such transfer. Tenant agrees to attorn to the new
owner.

    SECTION 30.    ESTOPPEL CERTIFICATE.    At any time with at least fifteen
(15) days' prior notice by Landlord, Tenant shall execute, acknowledge, and
deliver to Landlord a certificate certifying: (a) that this Lease is unmodified
and in full force or, if there have been mod)fications, that this Lease is in
full force, as mod)fied, together with the date and nature of each mod)fication,
(b) the amount of the Base Rent, most recent Escalation Rent, if any, and the
date to which the rent has been paid, (c) that no notice has been received by
Tenant of any default that has not been cured, except defaults specified in the
certificate, (d) that no default of Landlord is claimed by Tenant, except
defaults specified in the certificate, and (e) other matters as may be
reasonably requested by Landlord. Any certificate may be relied on by
prospective purchasers, current or prospective mortgagees, or current or
prospective baneficiaries under any deed of trust on the Building.

    SECTION 31.    LIGHT, AIR, OR VIEW RIGHTS.   Any diminution or shutting off
of light, air, or view by any structure that may be erected on lands adjacent to
the Building shall not affect this Lease or impose any liability on Landlord.

    SECTION 32.    RELOCATION.    [Intentionally Omitted]

    SECTION 33.    BROKERS.  Tenant and Landlord agree that, except as
indicated in the Basic Lease Information, no broker or finder has been involved
in the transaction described in this Lease and Landlord and Tenant agree that in
the event any broker, salesperson or other person makes any claim for any
commission or finder's fee based upon the lease of the Premises to Tenant or any
other items or interests contemplated by this Lease, the party through whom said
broker, salesperson or other person makes is claim shall indemnify and hold
harmless the other party from said claim and all liabilities, costs and expenses
relating thereto, including reasonable attorneys' fees, which may be incurred by
such other party in connection with such claim. Landlord shall pay Grubb & Ellis
("Landlord's Broker'), the assignee of Stubbs, Collenette & Associates, Inc., a
commission in connection with this Lease in the manner and upon the satisfaction
of the terms and conditions set forth in that Exclusive Leasing Agreement dated
as of October 4, 1994, a amended and assigned to Landlord's Broker, executed by
Landlord and Stubbs, Collenette & Associates, Inc.

    SECTION 34.    HOLDING OVER.

    (a)  If, without objection by Landlord, Tenant holds possession of the
Premises after expiration of the term of this Lease, Tenant shall become a
tenant from month-to-month on the terms specified in this Lease, except those
pertaining to term, option to extend, and option to acquire the Building, if
any, but at a monthly rental equivalent to one hundred and fifty percent (150%)
of the then prevailing monthly rental paid by Tenant at the expiration of the
term of this Lease, payable in advance on or before the first day of each month.
Each party shall give the other notice of intention to terminate the tenancy at
least one (1) month prior to the date of termination of a monthly tenancy.

    (b)  If, over Landlord's objection, Tenant holds possession of the Premises
after expiration of the term of this Lease or expiration of the holdover
tenancy, Tenant shall be deemed to be a tenant-at-sufferance and, without
limiting the liability of Tenant for unauthorized occupancy of the Premises,
Tenant shall indemnify Landlord and any replacement tenant for the Premises for
any damages or loss suffered by either Landlord or the replacement tenant
resulting from Tenant's failure to vacate the Premises in a timely manner.

    SECTION 35.    SECURITY DEPOSIT.   [Intentionally Omitted]


                                         -21-
<PAGE>

    SECTION 36.    WAIVER.   The waiver by either Landlord or Tenant of any
agreement, condition, or provision contained in this Lease shall not be deemed
to be a waiver of any subsequent breach of the agreement, condition, or
provision or any other agreement, condition, or provision contained in the
Lease, nor shall any custom or practice that may arise between the parties in
the administration of the terms of this Lease be construed to waive or to lessen
the right of Landlord or Tenant to the performance by Tenant or Landlord,
respectively, in strict accordance with these terms The subsequent acceptance of
rental under this Lease by Landlord shall not be deemed to be a waiver of any
preceding breach by Tenant of any agreement, condition, or provision of this
Lease, other than the failure of Tenant to pay the particular accepted rental,
regardless of knowledge of the preceding breach at the time of the rental
acceptance.

    SECTION 37.    NOTICES AND CONSENTS.    All notices, consents, demands, and
other communications from one parry to the other that are given pursuant to the
terms of this Lease shall be in writing and shall be deemed to have been fully
given when delivered, including delivery by commercial delivery services or
facsimile transmission, or if deposited in the United States mail, certified or
registered, postage prepaid, when received or refused. ALL notices, consents,
demands, and other communications shall be addressed as follows: to Tenant at
the address specified in the Basic Lease Infomration, or to another place or
person as Tenant may designate in a notice to Landlord, or delivered to Tenant
at the Premises; to Landlord at the address specified in the Basic Lease
Information, or to another place as Landlord may designate in a notice to
Tenant.

    SECTION 38     ENTIRE AGREEMENT.      There are no oral agreements 
between Landlord and Tenant affecting this Lease, and this Lease supersedes 
and cancels all previous negotiations, arrangements, brochures, agreements, 
and understandings between Landlord and Tenant or displayed by Landlord to 
Tenant with respect to the subject matter of this Lease. There are no 
representations between Landlord and Tenant other than those contained in 
this Lease. All implied warranties, including implied warranties of 
merchantability and fitness, are excluded.

    SECTION 39.    AUTHORITY.      If either of the parties signs this Lease as
a corporation, each person executing this Lease on behalf of the party warrants
that the party is a duly formed validly existing corporation, that the party is
qualifi ied to do business in California, and any other jurisdiction in which it
conducts business, that the party has the right and authority to enter into this
Lease, and that each person signing on behalf of the corporation is authorized
to do so. If either of the parties signs this Lease as a partnership, each
person executing this Lease on behalf of the party warrants that the party is a
partnership, that the partnership has the right and authority to enter into this
Lease, and that each person signing on behalf of the partnership is authorized
to sign.

    SECTION 40     PLURAL AND SINGULAR.   The words Landlord and Tenant as 
used in this Lease shall include the plural as well as the singular.

    SECTION 41.    JOINT AND SEVERAL OBLIGATIONS.     If there is more than one
Tenant, the obligations imposed on Tenant shall be joint and several.

    SECTION 42     TIME OF THE ESSENCE.   Time is of the essence in this 
Lease and all of its provisions.

    SECTION 43.    EXAMINATION OF LEASE.    Submission of this instrument for
examination or signature by Tenant does not constitute a reservation of or
option for lease, and it is not effective as a lease or otherwise until
execution and delivery by both Landlord and Tenant.

    SECTION 44.    HEIRS, SUCCESSORS, AND ASSIGNS.    The agreements,
conditions, and provisions contained in this Lease shall, subject to the
provisions for assignment, apply to and bind the heirs, executors,
administrators, successors, and assigns of the parties to it.


                                         -22-
<PAGE>

    SECTION 45.    NAME OF BUILDING.  Tenant shall not, without the consent 
of Landlord, use the name of the Building for any purpose other than as the 
address of the business to be conducted by Tenant in the Premises.

    SECTION 46.    ILLEGALITY OR UNENFORCEABILITY OF PORTION OF LEASE.    
    If any provision of this Lease is determined to be illegal or
unenforceable, this determination shall not affect any other provision of this
Lease, and all other provisions shall remain in full force and effect.

    SECTION 47.    GOVERNING LAW.      This Lease shall be governed by and
construed pursuant to law of the State of California.

    SECTION 48   OBLIGATIONS INDEPENDENT.   The obligations of each party
hereunder are independent and do not constitute conditions to the effectiveness
of the other party's obligations. The nonperformance by either party of any of
its obligations shall not excuse any nonperformance by the other party except to
the extent that it makes such other party's performance impossible or
impracticable.

    SECTION 49.    EXHIBITS.      The exhibits and addendum, if any, specified
in the Office Lease Index set forth at the beginning of this Lease are attached
to this Lease and by this reference made a part of it.

    The parties have executed this Lease as of the date first set forth above.

Landlord:                              Tenant:

PACIFIC RESOURCES                      HAMBRECHT & QUIST CALIFORNIA,
DEVELOPMENT INC., a California         a California corporation
Corporation

By: : /s/ Kevin Wu                     By: /s/ J. Logan Burke

Name:  Kevin Wu                        Name:  J. Logan Burke

Its:  Managing Director                Its:  Vice President




                                         -23-