<PAGE>

                                                                   EXHIBIT 10.10


                            .  GIBRALTAR CENTER  .

                        .  OFFICE BUILDING NET LEASE  .

                            BASIC LEASE INFORMATION


Date of Lease:           August 26, 1999


Landlord:                CEP GIBRALTAR LLC


Landlord's Address:      c/o Ellis Partners, Inc.
                         433 California Street, Suite 610
                         San Francisco, California 94104
                         Attn.: James F. Ellis


Tenant:                  DIGITAL BROADCAST NETWORK CORPORATION


Tenant's Address:        977 Charter Commons
                         Chesterfield, MO 63017
                         Attn.: General Counsel


                         With a copy, after the Commencement Date, to the
                         Premises, Attention:

                         _______________


Building:                5667 Gibraltar Drive, Pleasanton, California (Gibraltar
                         Center II) and 5731 W. Las Positas Drive, Pleasanton,
                         California (Gibraltar Center I)


Leased Premises:         Approximately 101,675 rentable square feet consisting
                         of the entire Gibraltar Center II building
                         (approximately 59,445 rentable square feet) and the
                         entire Gibraltar Center I building (approximately
                         42,230 rentable square feet)


Rentable Area:           Approximately 101,675 rentable square feet


Gibralter I Term Commencement Date:     February 1, 2000


Gibraltar II Term Commencement Date:    The earlier of: (i) February 1, 2000, or
                                        (ii) the date Tenant achieves
                                        Substantial Completion as defined in
                                        Section 1.21 (excluding temporary office
                                        use by not more than 20 employees)


Term Expiration Date:    January 31, 2010
<PAGE>

Option to Extend:        Number of Extension Periods: Two (2)
                         Months per Extension Period: Sixty (60)


Base Rent:               Month            Amount (per square foot per month/NNN)
                         -----            --------------------------------------
                         1-12                             $1.37

                         Beginning in the second (2/nd/) year of the Lease, Base
                         Rent shall increase two percent (2%) annually


Tenant's Proportionate Share (Building):     100%


Tenant's Proportionate Share (Project):      100%


Parking Spaces:          Four hundred six (406) spaces (based on four (4)
                         parking spaces per one thousand (1000) rentable square
                         feet) subject to reductions attributable to Tenant's
                         buildout and improvements


Security Deposit:        $4,418,000.00 (as more particularly described in
                         Section 5.14 of the Lease)


Guarantor:               None


Landlord's Broker:       CB Richard Ellis


Tenant's Broker:         Grubb & Ellis


    [Remainder of page intentionally left blank; signature page to follow.]

                                      ii
<PAGE>

     The foregoing BASIC LEASE INFORMATION is incorporated herein and made a
part of the LEASE to which it is attached. If there is any conflict between the
BASIC LEASE INFORMATION and the LEASE, the BASIC LEASE INFORMATION shall
control.

                       "LANDLORD":

                       CEP GIBRALTAR LLC, a Delaware limited liability company

                       By:  CEP INVESTORS XI LLC,
                            a Delaware limited liability company,
                            its sole Member

                            By:  EPI INVESTORS XI LLC,
                                 a California limited liability company,
                                 its Manager

                                 By:  Ellis Partners, Inc.,
                                      a California corporation,
                                      its Manager

                                 By:     /s/ James F. Ellis
                                       ----------------------------------
                                 Name:   JAMES F. ELLIS
                                       ----------------------------------
                                 Title:  Vice President
                                       ----------------------------------

                       "TENANT":

                       DIGITAL BROADCAST NETWORK CORPORATION,
                       a Missouri corporation


                       By:  /s/ Bernard Schneider
                          -----------------------------------------
                       Typed Name: Bernard Schneider
                                  ---------------------------------
                       Title: President & Chief Executive Officer
                             --------------------------------------

                       By:  /s/ Mark Ivis
                          -----------------------------------------
                       Typed Name: Mark Ivis
                                  ---------------------------------
                       Title: Vice President
                             --------------------------------------

                                      iii
<PAGE>

                             OFFICE BUILDING LEASE

     THIS LEASE, made as of the date specified in the BASIC LEASE INFORMATION
sheet, by and between the landlord specified in the BASIC LEASE INFORMATION
sheet ("Landlord") and the tenant specified in the BASIC LEASE INFORMATION sheet
("Tenant").

                                  Article 1.
                                  Definitions

     1.01.  Definitions: Terms used herein shall have the following meanings:

     1.02.  "Additional Rent" shall mean all monetary obligations of Tenant
under this Lease other than the obligation for payment of Net Rent.

     1.03.  [Intentionally deleted.]

     1.04.  "Base Rent" shall mean the sums due from time to time as rental for
the Leased Premises.

     1.05.  [Intentionally deleted.]

     1.06.  "Basic Operating Cost" shall have the meaning given in Section 3.05.
                                                                   -------------

     1.07.  "Building" shall mean the two buildings and other improvements
associated therewith identified on the Basic Lease Information sheet. Building
shall also include, if applicable, all structural elements of the Building,
elevator system, washrooms, fire exit stairways, electrical risers, telephone
risers, plumbing risers, sprinkler systems, air distribution system and air
handling loop, including VAV boxes, janitorial closets, telephone closets, and
electrical closets.

     1.08.  [Intentionally deleted.]

     1.09.  "Common Areas" shall mean (a) the areas on individual floors of the
Building devoted to non-exclusive uses such as common corridors, lobbies, fire
vestibules, elevator foyers, stairways, elevators, electric and telephone
closets, restrooms, mechanical closets, janitor closets and other similar
facilities for the benefit of all tenants (and invitees) on the particular floor
and other floors, and (b) other areas of the Project available for the use and
benefit of all tenants (and invitees).

     1.10.  "Computation Year" shall mean a fiscal year consisting of the
calendar year commencing January 1st of each year during the Term, commencing in
the year 2000 and continuing through the Term with a short or stub fiscal year
in (i) the year 2000 for the period between the Term Commencement 'Date and
December 31 of such year and (ii) any partial fiscal year in which the Lease
expires or is terminated for the period between January 1 of such year and the
date of lease termination or expiration.

     1.11.  "Gibraltar I" shall mean the building located at 5731 W. Las Positas
Drive, Pleasanton, California and commonly known as Gibraltar Center I.

     1.12.  "Gibraltar II" shall mean the building located at 5667 Gibraltar
Drive, Pleasanton, California and commonly known as Gibraltar Center II.

                                       1
<PAGE>

     1.13.  "Gibraltar I Term Commencement Date" shall mean the date set forth
in the Basic Lease Information sheet and shall apply with respect to Gibraltar
I.

     1.14.  "Gibraltar II Term Commencement Date" shall mean the date set forth
in the Basic Lease Information sheet and shall apply with respect to Gibraltar
II.

     1.15.  "Landlord's Broker" shall mean the individual or corporate broker
identified on the Basic Lease Information sheet as the broker for Landlord.

     1.16.  "Landlord's Contribution" shall have the meaning given in Exhibit B.
                                                                      ---------

     1.17.  "Landlord's Improvements" shall have the meaning given in Exhibit B.
                                                                      ---------

     1.18.  "Leased Premises" shall mean the floor area more particularly shown
on the floor plan attached hereto as Exhibit A, containing the Rentable Area (as
                                     ---------
such term is defined in Section 1.18 below) specified on the Basic Lease
                        ------------
Information sheet, together with all ancillary additions.

     1.19.  "Net Rent" shall mean the total of Base Rent and Tenant's
Proportionate Share of Basic Operating Cost.

     1.20.  "Permitted Use" shall mean: (1) multi-media, data center,
telecommunications business, including general office and administrative use;
(2) the installation and maintenance of its multi-media, telecommunications
systems and equipment; and, (3) the collocation of hardware and applications
systems belonging to Tenant's customers, wherein said equipment is physically
located in an area within the Leased Premises housing such equipment and
application belonging to third parties. Tenant's use of the Premises shall be
seven (7) days per week, twenty four (24) hours per day. Permitted Use shall not
include (a) offices or agencies of any foreign government or political
subdivision thereof,(b)offices any agency or bureau of any state, county or city
government; (c) offices of any health care professionals; (d) schools or other
training facilities which are not ancillary to corporate, executive or
professional office use; or (e) retail or restaurant uses.

     1.21.  "Project" shall mean the two buildings located at 5667 Gibraltar
Drive, Pleasanton, California (Gibraltar Center II) and 5731 W. Las Positas
Drive, Pleasanton, California (Gibraltar Center I), the parking and common areas
affiliated therewith, and the real property on which the buildings and the
parking and common areas are located.

     1.22.  "Rent" shall mean Net Rent plus Additional Rent.

     1.23. "Rentable Area" The Rentable Area of the Leased Premises is agreed
for all purposes of this Lease to be the amount stated on the Basic Lease
Information.

     1.24.  "Security Deposit" shall mean the amount specified on the Basic
Lease Information sheet and more particularly described in Section 5.14.
                                                           ------------

     1.25.  "Substantial Completion" shall mean (and the Leased Premises shall
be deemed "Substantially Complete") when (i) installation and testing of Tenant
Improvements and Landlord's Improvements has occurred; (ii) Tenant has access to
Leased Premises; (iii) basic services (as described in Section 4.01) are
                                                       ------------
available to the Leased Premises; (iv) Tenant's architect has issued a
certificate of

                                       2
<PAGE>

Substantial Completion with respect to the Leased Premises; and (v) a
certificate of occupancy or its equivalent or a temporary occupancy permit for
the Leased Premises has been issued by appropriate governmental
authorities(excluding any temporary occupancy permit issued for the temporary
offices during the construction of Tenant' Improvements described herein).
Substantial Completion shall be deemed to have occurred notwithstanding a
requirement to complete "punchlist" items or similar corrective work. For
purposes of the Gibralter II Term Commencement Date, the term Substantial
Completion shall mean when Tenant obtains a certificate of occupancy or its
equivalent or a temporary occupancy permit for that portion of the Gibralter II
used as Tenant's service management center and approximately I 0,000 square feet
of data center space currently described as "Tenant's Phase II Buildout" plans
has been issued by appropriate governmental authorities (excluding any temporary
occupancy permit issued for the temporary offices during the construction of
Tenant Improvements described herein).

     1.26.  [Intentionally deleted.]

     1.27.  "Tenant Improvements" shall have the meaning given in Exhibit B.
                                                                  ---------

     1.28.  "Tenant's Broker" shall mean the individual or corporate broker
identified on the Basic Lease Information sheet as the broker for Tenant.

     1.29.  "Tenant's Physical Possession Date" shall mean the execution date of
this Lease with respect to Gibralter II, and no later than October 15, 1999 with
respect to Gibralter I. If possession of Gibralter I has not been delivered by
Landlord to Tenant by October 15, 1999, then the Gibralter I Term Commencement
Date shall be increased by an equal number of days. Tenant will have access to
Gibralter I prior to Tenant's Physical Possession Date for Gibralter, upon
reasonable notice to Landlord, for sitework.

     1.30.  "Tenant's Proportionate Share" is specified on the Basic Lease
Information sheet and is based on the percentage which the Rentable Area of the
Leased Premises bears to the total Rentable Area of the Project.

     1.31.  "Term" shall mean the period commencing with the Term Commencement
Date and ending at midnight on the Term Expiration Date.

     1.32.  "Term Commencement Date" shall mean the Gibralter I Term
Commencement Date with respect to Gibralter I, and the Gibralter II Term
Commencement Date with respect to Gibralter II.

     1.33.  "Term Expiration Date" shall mean the date set forth in the Basic
Lease Information sheet, unless sooner terminated pursuant to the terms of this
Lease or unless extended pursuant to the provisions of Section 8.01.
                                                       ------------

     1.34.  Other Terms. Other terms used in this Lease and on the Basic Lease
Information sheet shall have the meanings given to them herein and thereon.

                                  Article 2.
                                Leased Premises

     2.01.  Lease. Landlord hereby leases to Tenant and Tenant hereby leases
from Landlord the Leased Premises upon all of the terms, covenants and
conditions set forth in this Lease.

                                       3
<PAGE>

     2.02. Acceptance of Leased Premises. Tenant acknowledges that: (a) it has
been advised by Landlord, Landlord's Broker and Tenant's Broker, if any, to
satisfy itself with respect to the condition of the Leased Premises (including,
without limitation, the HVAC, electrical, plumbing and other mechanical
installations, fire sprinkler systems, security, environmental aspects, and
compliance with applicable laws, ordinances, rules and regulations) and the
present and future suitability of the Leased Premises for Tenant's intended use;
(b) Tenant has made such inspection and investigation as it deems necessary with
reference to such matters arid assumes all responsibility therefor, except as
otherwise specifically provided in this Lease, as the same relate to Tenants
occupancy of the Leased Premises and the term of this Lease; and (c) neither
Landlord nor Landlord's Broker nor Tenant's Broker nor any of Landlord's agents
has made any oral or written representations or warranties with respect to the
condition, suitability or fitness of the Leased Premises other than as may be
specifically set forth in this Lease. Tenant accepts the Leased Premises in its
AS IS condition existing on the date Tenant executes this Lease, subject to all
matters of record and applicable laws, ordinances, rules and regulations, and
subject to Landlord's warranties and representations contained herein, and
subject to Landlord's Shell Improvement obligations as set forth in Exhibit B
                                                                    ---------
Schedule B(1) hereto. Tenant acknowledges that neither Landlord nor Landlords
-------------
Broker nor any of Landlord's agents has agreed to undertake any alterations or
additions or to perform any maintenance or repair of the Leased Premises except
for the routine maintenance and janitorial work specified herein and except as
may be expressly set forth in Exhibit B.
                              ---------

     2.03. [Intentionally Deleted.]

     2.04. Reservation of Rights. Landlord reserves the right from time to time,
so long as reasonable access and basic services to the Leased Premises remain
available, to install, use, maintain, repair, relocate and/or replace pipes,
conduits, wires and equipment within and around the Building and to do and
perform such other acts and make such other changes in, to or with respect to
the Building or the Project (including without limitation with respect to the
driveways, parking areas, walkways and entrances to the Project) as Landlord
may, in the exercise of sound business judgment, deem to be appropriate. In
connection therewith, Landlord shall have the right to close temporarily any of
the Common Areas so long as reasonable access to the Leased Premises remains
available. All such Landlord work described above shall be done only with the
prior approval (which shall not be unreasonable withheld) and coordination with
Tenant so as not to unreasonably interfere with Tenant's business, reasonable
security procedures or to cause any posed threat to the design or use of
Tenant's data center or collocation facilities.

     2.05. Associated Rights Granted to Tenant.

           (a) Tenant shall have the right (collectively, the "Associated
Rights") to do the following or install at Tenant's cost the following equipment
in the areas (the "Associated Rights Area") located within the Project as
designated by Landlord, in the exercise of its discretion as provided below:

               (1)  Core Drilling. Subject to Landlord's reasonable approval,
                    -------------
Tenant shall have the right to core drill or otherwise penetrate the concrete
stab floor of the Leased Premises and/or Building in order: (i) to install
conduits and fiber/wire/cable therein; (ii) to make necessary electrical
connections; (iii) to make necessary HVAC connections; and, (iv) to bolt and/or
anchor Tenant's computer hardware and telecommunications racks and equipment.

               (2)  Dry Coolers / Condensing Units. Subject to Landlord's
                    ------------------------------
reasonable approval, and that of the Hacienda Owners Association arid the City
Of Pleasanton, Tenant shall have the right to install dry coolers/ condensing
units, necessary for Tenant's RVAC system in a location within reasonably

                                       4
<PAGE>

close proximity to the Leased Premises, in a mutually acceptable location,
either at ground level or on the roof of the Building.

               (3)  Fiber Optic Connectivity. Landlord shall cooperate with
                    ------------------------
Tenant in granting selected by Tenant, for the purpose of providing Tenant with
such connectivity; however, the cost of providing such fiber optic access to the
Building shall be home by Tenant. Tenant shall require at least four (4) points
of diverse entry at opposing ends of the Building with not less that fifty (50)
foot separation. To the extent available for use and if desirable by Tenant,
Tenant shall have the right to use existing fiber ducts installed by Landlord.

               (4)  Intra-Building Risers. Tenant shall have the right to access
                    ---------------------
the Building's risers for vertical and horizontal telecommunications wire/cable
distribution to the Leased Premises, and for mechanical distribution and for
electrical distribution; however, the cost of providing additional riser access
to the Building shall be home solely by Tenant. If desired by Tenant, Landlord
shall cooperate, at no expense to Landlord, with Tenant in creating a separate
and secure MPOE (minimum point of entry) on the ground floor of the Building, in
a location mutually agreed upon by Landlord and Tenant, with the square footage
of such area, and the rent applicable thereto, to be part of the Leased
Premises.

               (5)  Satellite Dish/Antennae. Subject to the approval by the
                    -----------------------
Hacienda Owners' Association and the City of Pleasanton, which, if required,
shall be obtained by Tenant at its expense, Tenant may, at its own expense,
install on the roof of the Building such antennae, satellite dish or similar
equipment as may be required to conduct its business, at such locations and in
such quantities as are reasonably approved by Landlord. Tenant shall adhere to
industry standards for installation and workmanship, all work to be completed to
Landlord's reasonable satisfaction. All engineering and design work shall be
undertaken by Tenant, at its sole expense. Upon termination of the Lease, Tenant
shall, if so requested by Landlord, remove all of Tenant's equipment and shall
repair, to Landlord's reasonable satisfaction, any damage caused by the
installation or removal of such equipment. To maintain any roof warranty of the
Building, Tenant shall use such roofing contractors as directed by Landlord.

               (6)  Emergency Generators. Landlord shall grant Tenant the right
                     -------------------
to install upon the Leased Premises, within close proximity to the Building and
to Tenant's main electrical panel, in a mutually acceptable location, three (3)
emergency generators, sized between 800 and 1250 KVA, with accompanying fuel
capacities to totaling approximately 15,000 gallons. Any fuel tank(s) shall be
located above ground and designed to the specifications of applicable
governmental authorities. Said generators shall be properly screened. Aside from
Landlord's cooperation, all costs to install the foregoing shall be at Tenant's
expense.

               (7)  Underground Boring. Tenant shall have the right to lay four
                    ------------------
separate, distinct routes of underground fiber optic cable to the Leased
Premises, originating and entering either or both of the two buildings that
constitute the Building at opposing sides of each of such buildings, with a
separation of not less that fifty feet. The exact location of these routes are
yet undetermined. Tenant shall utilize computer driven underground directional
boring equipment to "trench" for its cable installation without disturbing the
sidewalk, landscape areas or the parking area with the possible exception of a
small "insertion" areas. Tenant will utilize expert underground detection
services to locate and avoid any utility or similar lines or structures located
below the driveway surface. Further, Tenant shall indemnify, defend and hold the
Landlord harmless from any potential liability from Tenant's underground boring
activities. Tenant shall submit to Landlord, for Landlord's prior approval, the
desired route of all underground boring.

                                       5
<PAGE>

                (8) Fire Protection & Life Safety. Because of the nature of the
                    -----------------------------
costly computer and telecommunications equipment that Tenant will locate within
the Leased Premises, a water-based fire sprinkler system would cause extensive
damage to Tenant's equipment in the event of a discharge. As a result, within a
portion of the Leased Premises, Tenant intends to install and shall have the
right to install an additional fire suppression system and intends to take steps
to modify any existing fire sprinkler system within the Leased Premises to avoid
a water discharge unless a real fire threat exists- Said modifications may
include the installation of high temperature sprinkler heads and the
modification of the sprinkler control system affecting the Leased Premises such
that the sprinkler system will be a "dry-pipe", "pre-action" system controlled
by a fire sensor that will not pressurize the pipes with water until the sensor
"reads" a fire. Tenant will comply with the requirements of the local fire
protection authorities. Landlord will cooperate fully with Tenant in Tenant's
efforts to install a fire suppression system, including redundant fire
suppression systems, such as FM-200 or such other similar fire suppression
agent. Tenant shall be responsible for the restoration of the main sprinkler
distribution system.

           (b) Tenant shall, at its cost, immediately repair and restore to its
prior condition any damage to the Leased Premises, the Building or the Project
caused by any of the foregoing and caused by the installation, operation or
maintenance of any equipment, fixtures and cables pursuant to this Section 2.05.
                                                                   ------------
If Tenant fails to repair and restore damage caused to the Leased Premises, the
Building or the Project within a reasonable time to effect such repair or
restoration, Landlord shall have the right to repair and restore such damage and
receive reimbursement from Tenant of all costs incurred by Landlord.

           (c) No installation of equipment, fixtures or cables pursuant to
Tenant's Associated Rights, alterations, additions, or improvements shall be
made by Tenant without the prior written consent of Landlord, which shall not be
unreasonably withheld. Tenant shall obtain all necessary governmental permits
required for any installation, alteration, addition, or improvement approved by
Landlord and shall comply with all applicable governmental law, regulations,
ordinances, and codes.

                                  Article 3.
                              Term, Use and Rent

     3.01. Term. Except as otherwise provided in this Lease, the Term shall
commence upon the Term Commencement Date, and shall continue in full force for
the Tenn. Tenant shall be given access to the Leased Premises starting on the
Tenant's Physical Possession Date in order for Tenant, its agents, employees and
contractors to make site evaluations, and to install, if any, furniture,
telephone networks, computer networks and other improvements and subject to the
prior reasonable approval by Landlord. From the Tenants Physical Possession Date
through the Term Commencement Date, Tenant shall be subject to all of the
covenants in this Lease, except that Tenants obligation to pay Net Rent shall
commence in accordance with Section 3.03 below. From Tenant's Physical
                            ------------
Possession Date through the Gibralter II Term Commencement Date and the
Gibraltar I Term Commencement Date respectively, Landlord shall make available
site services, including temporary utilities, at no expense to Tenant; however,
Tenant shall be responsible for any refuse disposal and any operating expenses
related to any temporary office use by Tenant. Notwithstanding any other
provision of this Lease to the contrary, if access to the Gibralter II Leased
Premises is not given to Tenant within fifteen (15) days of the Tenants Physical
Possession Date, then Tenant may, at its option, by notice in writing to
Landlord within fifteen (15) days thereafter, cancel this Lease in which event
neither Landlord nor Tenant shall have any further obligations hereunder. If
written notice of cancellation is riot received by Landlord within such fifteen
(15) day period, Tenant's right to cancel this Lease shall terminate and be of
no further force or effect. Notwithstanding any other provision of this Lease to
the contrary, if access to the Gibralter I Leased Premises is not given to
Tenant on or before

                                       6
<PAGE>

November 15, 1999, Landlord shall be responsible and shall immediately pay
Tenant all costs incurred or to be incurred by Tenant to rectify Tenant's
construction delays to bring the construction schedule back to the original
schedule, which costs may include but not be limited to overtime work.
Throughout the Term of this Lease, Tenant shall have access to the Leased
Premises at all hours on all days of the year, subject to situations beyond the
control of Landlord. When the Term Commencement Date and the Term Expiration
Date have been ascertained, the parties shall promptly execute a Confirmation of
Term of Lease substantially in the form attached as Exhibit C.
                                                    ---------

     3.02. Use. Tenant shall use the Leased Premises solely for the Permitted
Use and for no other use or purpose, except as permitted by Landlord pursuant to
Landlord's written consent, which consent will not be unreasonably withheld,
conditioned or delayed. It shall not be deemed unreasonable for Landlord to
withhold its consent to a proposed change of use if the proposed use is one set
forth in Section 1.16 (a) through (e).
         ----------------         ---

     3.03. Base Rent.

           (a) Tenant shall pay the Base Rent to Landlord in accordance with the
schedule set forth on the Basic Lease Information sheet and in the manner
described below. Commencing with the first day of the first calendar month of
the Term, Tenant shall pay the Net Rent (consisting of Base Rent plus, when
applicable in accordance with Section 3.04 below, Tenants Proportionate Share of
                              ------------
Basic Operating Cost) in monthly installments on or before the first day of each
calendar month during the Term and any extensions or renewals thereof, in
advance without demand and without any reduction, abatement, counterclaim or
setoff, unless otherwise specifically provided in this Lease, in lawful money of
the United States at Landlord's address specified on the Basic Lease Information
sheet or at such other address as may be designated by Landlord in the manner
provided for giving notice under Section 9.11 hereof.
                                 ------------

           (b) If the Term commences on other than the first day of a month,
then the Base Rent provided for such partial month shall be prorated based upon
a thirty (30)-day month and the prorated installment shall be paid on the first
day of the calendar month next succeeding the Term Commencement Date together
with the other amounts payable on that day. If the Term terminates on other than
the last day of a calendar month, then the Net Rent provided for such partial
month shall be prorated based upon a thirty (30)-day month and the prorated
installment shall be paid on the first day of the calendar month in which the
date of termination occurs.

     3.04. Tenant's Proportionate Share of Basic Operating Cost.

           (a) Commencing on the Term Commencement Date and continuing through
the remainder of the Term, Tenant shall pay to Landlord Tenant's Proportionate
Share of the Basic Operating Cost attributable to each Computation Year.

           (b) During the first Computation Year, on or before the flat day of
each month during such Computation Year, Tenant shall pay to Landlord one-
twelfth (1/12th) of Landlord's estimate of the amount payable by Tenant under
Section 3.04(a) as set forth in Landlord's written notice to Tenant delivered on
---------------
or before the Term Commencement Date. During the last month of each Computation
Year (or as soon thereafter as practicable), Landlord shall give Tenant notice
of Landlord's estimate of the amount payable by Tenant under Section 3.04(a) for
                                                             ---------------
the following Computation Year. On or before the first day of each month during
the following Computation Year, Tenant shall pay to Landlord one-twelfth (1/12)
of such estimated amount, provided that if Landlord fails to give such notice in
the last month of the prior year, then

                                       7
<PAGE>

Tenant shall continue to pay on the basis of the prior year's estimate until the
first day of the calendar month next succeeding the date such notice is given by
Landlord; and from the first day of the calendar month following the date such
notice is given, Tenant's payments shall be adjusted so that the estimated
amount for that Computation Year will be fully paid by the end of that
Computation Year. If at any time or times Landlord determines that the amount
payable under Section 3.04(a) for the current Computation Year will vary from
              ---------------
its estimate given to Tenant, Landlord, by not less than ten (10) business days'
notice to Tenant, may revise its estimate for such Computation Year, but not
more frequently that twice for any Computation Year, and subsequent payments by
Tenant for such Computation Year shall be based upon such revised estimate.

          (c)  Within sixty (60) days following the end of each Computation
Year, Landlord shall deliver to Tenant a statement of amounts payable under
Section 3.04(a) for such Computation Year prepared by Landlord's agent. If such
---------------
statement shows an amount owing by Tenant that is less than the payments for
such Computation Year previously made by Tenant, Landlord shall credit such
amount to the next payment(s) of Net Rent falling due under this Lease. If such
statement shows an amount owing by Tenant that is more than the estimated
payments for such Computation Year previously made by Tenant, Tenant shall pay
the deficiency to Landlord within ten (I 0) business days after delivery of such
statement. If, within two (2) years of Tenant s receipt of Landlord's statement,
Tenant notifies Landlord that Tenant desires to audit or review Landlord's
statement, Landlord shall cooperate with Tenant to permit such audit or review
during normal business hours. Landlord shall make available in the San Francisco
Bay Area at Landlord's, or at Landlord's election at Landlord's property
manager's, place of business, such books and records as are reasonably necessary
for Tenant to conduct and complete such audit. Tenant shall have the right to
make copies of such books and records at Tenant's sole cost and expense. Tenant
shall bear all other costs and expenses associated with Tenant's audit
(including fees of Tenant's auditor). Upon completion of the audit, Tenant shall
provide Landlord with a copy of the auditor's report. Within thirty (30) days of
completion of the audit, if Tenant desires to challenge Landlord's statement,
then Tenant shall provide Landlord with notice of challenge via called mail.
Within thirty (30) days of Landlord's receipt of Tenant's notice of challenge,
Landlord shall notify Tenant as to whether Landlord agrees or disagrees with the
conclusions reached in Tenant's auditor's report. Landlord's failure to respond
shall be deemed to constitute an agreement with the Tenant's auditor's report.
After Landlord's notice, Landlord and Tenant shall endeavor to resolve any
disagreements regarding Tenant's auditor's report. In the event such audit
reveals a discrepancy in Tenant's favor, and Landlord agrees with the
conclusions of Tenant's auditor, then Landlord shall credit the amount of such
discrepancy to the next payment(s) of Net Rent falling due under this Lease. In
the event such audit reveals a discrepancy in Landlord's favor, Tenant shall pay
the amount of the discrepancy to Landlord within ten (10) business days of
Landlord's acceptance of Tenant's auditor's report If the discrepancy in
Tenant's favor, as agreed to by Landlord, or determined by the arbitrator, is
greater than three percent (3%) of Tenant's Proportionate Share of Basic
Operating Cost paid by Tenant for the Computation Year being audited, Landlord
shall reimburse Tenant for all reasonable costs and expenses associated with
Tenant's audit (including fees of Tenant's auditor). Any such audit may only be
conducted by an independent nationally recognized accounting firm or a
nationally recognized real estate management or consulting firm that is not
being compensated by Tenant on a contingency fee basis. The failure of Tenant to
notify Landlord that Tenant desires an audit within one (1) year of Tenant's
receipt of Landlord's statement under this Section 3.04(c) shall constitute an
                                           ---------------
acceptance by Tenant of Landlord's statement and a waiver by Tenant of its right
to audit for such Computation Year. If Tenant commences an audit in accordance
with this Section 3.04(c), then such audit and the Tenant s auditor's report
          ---------------
must be completed within one hundred twenty (120) days of Tenant s notice to
Landlord of Tenant's desire to audit. Failure of Tenant to complete the audit
within such one hundred twenty (120) day period shall constitute an acceptance
by Tenant of Landlord's statement for such Computation Year. The respective
obligations of Landlord and Tenant under this Section 3.04(c) shall survive the
                                              ---------------
Term Expiration Date, and, if the Term Expiration Date is a day other

                                       8
<PAGE>

than the last day of a Computation Year, the adjustment in Tenant's
Proportionate Share of Basic Operating Cost pursuant to this Section 3.04(c) for
                                                             ---------------
the Computation Year in which the Term Expiration Date occurs shall be prorated
in the proportion that the number of days in such Computation Year preceding the
Term Expiration Date bears to three hundred sixty-five (365).

          (d)  Landlord shall have the same remedies for a default in the
payment of Tenant's Proportionate Share of Basic Operating Cost as for a default
in the payment of Base Rent.

          (e)  If the parties cannot agree on the results of Tenant's audit
within sixty (60) days following delivery of Tenant's auditor's report to
Landlord, then either party may commence arbitration with respect to the matters
disputed in Tenant's audit by notice to the other party ("Arbitration Notice").
The failure of Tenant to provide an Arbitration Notice within one hundred twenty
(120) days of Tenant's delivery of the Tenant's auditor's report to Landlord
shall constitute a waiver by Tenant of its right to arbitrate hereunder, and
except 'for such adjustments as have been agreed to by Landlord, Landlord's
statement provided under Section 3.04(c) shall be conclusive, and binding to
                         ---------------
Tenant. Within thirty (30) days of the Arbitration Notice, Landlord and Tenant
shall jointly select an arbitrator, who shall be unaffiliated in any manner with
either Landlord or Tenant and shall have been active over the five (5) year
period ending on the date of such appointment in the management of comparable
commercial properties within the San Francisco Bay Area and shall have held the
designation of Certified Property Manager for an equivalent period of time.
Neither Landlord nor Tenant shall consult with such arbitrator as to his or her
opinion as to the disputed matters prior to the appointment. The determination
of the arbitrator shall be limited solely to issues raised by Tenant's auditor's
report or by Landlord's response to Tenant's auditors report. Such arbitrator
may hold hearings and require such briefs as the arbitrator, in his or her sole
discretion, determines is necessary. In addition, Landlord or Tenant may submit
to the arbitrator with a copy to the other party within five (5) business days
after the appointment of the arbitrator any data and additional information that
such party deems relevant to the determination by the arbitrator and the other
party may submit a reply in writing within five (5) business days after receipt
of such data and additional information. The arbitrator shall conduct such
evidentiary hearings as the arbitrator deems necessary or appropriate.

               (1)  The arbitrator shall, within thirty (30) days of his or her
appointment, reach a decision as to the disputed matters in Tenant' s auditor's
report, and shall notify Landlord and Tenant of such determination.

               (2)  The decision of the arbitrator shall be binding upon
Landlord and Tenant.

               (3)  If Landlord and Tenant fail to agree upon and appoint such
arbitrator, then the appointment of the arbitrator shall be made by the American
Arbitration Association.

               (4)  If Landlord and Tenant fail to agree upon other matters
relating to the arbitration, then the rules of the American Arbitration
Association shall govern such arbitration.

               (5)  The cost of arbitration shall be paid by the substantially
unsuccessful party.

               (6)  The arbitration proceeding and all evidence given or
discovered pursuant thereto shall be maintained in confidence by all parties.

               (7)  Judgment upon the award rendered by the arbitrator may be
entered by either party into any court having jurisdiction, or application may
be made to such court for a judicial recognition of the award or an order of
enforcement thereof, as the case may be.

                                       9
<PAGE>

     3.05. Basic Operating Cost.

           (a) Basic Operating Cost shall mean all expenses and costs (but not
specific costs which are separately billed to or paid by particular tenants of
the Project of every kind and nature which Landlord shall pay or become
obligated to pay because of or in connection with the management, ownership,
maintenance, repair, preservation and operation of the Project and its
supporting facilities directly servicing the Project (determined in accordance
with generally accepted accounting principles, consistently applied) including,
but not limited to, the following:

               (1)  Wages, salaries and related expenses and benefits of all on-
site and off-site employees and personnel engaged in the operation, maintenance,
repair and security of the Project, to the extent such charges are directly
allocable to services rendered by the employees and personnel for the benefit of
the Project.

               (2)  [Intentionally deleted.]

               (3)  All supplies, materials, equipment and equipment rental used
in the operation, maintenance, repair and preservation of the Project.

               (4)  Utilities, including water, sewer and power, telephone,
communication and cable television facilities, lighting, heating, air
conditioning and ventilating the entire Project to the extent not billed
directly to Tenant.

               (5)  All exterior maintenance, janitorial, alarm and security
service, elevator and service agreements for the Project and the equipment
therein, including, without limitation, window cleaning, sidewalks, landscaping,
Building exterior and service areas, to the extent not billed to Tenant.

               (6)  A management cost recovery in an amount not to exceed a
commercially reasonable management cost recovery fee competitive in the
immediate market but in no events greater than three percent (3%) of all Rent
(excluding such management cost recovery) derived from the Project.

               (7)  Day-to-day ordinary and reasonable legal and accounting
services incurred to the extent attributable to the normal operation of the
Project, excluding those expenses incurred in lease negotiations, termination of
leases, extension of leases or legal costs incurred in proceedings by or against
any specific tenant.

               (8)  All insurance costs, including, but not limited to, the cost
of all risk property and liability coverage and rental income and earthquake
insurance applicable to the Project and Landlord's personal property used in
connection therewith, as well as commercially reasonable deductible amounts
applicable to such insurance; provided, however, that Landlord may, but shall
not be obligated to" carry earthquake insurance.

               (9)  Repairs, replacements and general maintenance (except for
repairs paid by proceeds of insurance or by Tenant or other tenants of the
Project or third parties, and alterations attributable solely to tenants of the
Project other than Tenant).

               (10) All real estate or personal property taxes, possessory
interest taxes, business or license taxes or fees, service payments in lieu of
such taxes or fees, annual or periodic license or use fees,

                                       10
<PAGE>

excises, transit charges, housing fund assessments, open space charges,
assessments, bonds, levies, fees or charges, general and special, ordinary and
extraordinary, unforeseen as well as foreseen, of any kind which are assessed,
levied, charged, confirmed or imposed by any public authority upon the Project
(or any portion or component thereof), its operations, this Lease, or the Rent
due hereunder (or any portion or component thereof), except: (i) inheritance or
estate taxes imposed upon or assessed against the Project, or any part thereof
or interest therein, and (ii) Landlord's personal or corporate income, gift or
franchise taxes.

               (11) Amortization over the useful life (together with reasonable
financing charges) of capital improvements made to the Project subsequent to the
Term Commencement Date which are designed to improve the operating efficiency of
the Project, or which may be required by governmental authorities, including
those improvements required for energy conservation and for the benefit of
individuals with disabilities ("ADA Improvements").

          (b)  With respect to Section 3.05(a)(11) above, to the best of
                               -------------------
Landlord's knowledge, the Project is in compliance with the Americans with
Disabilities Act ("ADA"). ADA Improvements, as defined in Section 3.05(a)(11)
                                                          -------------------
above, includes ADA compliance work in any part of the Project required by
governmental authorities due to changes in law, rules or regulations after the
date of this Lease. ADA Improvements, for the purposes of Section 3.05(a)(11)
                                                          -------------------
shall not include any ADA compliance work in other tenant's spaces in the
Project which is triggered by virtue of tenant improvement work in such space.
Tenant shall be responsible for one hundred percent (100%) of the cost of ADA
compliance work triggered by any tenant improvements (or any subsequent
alterations or additions made by Tenant) subsequent to the Commencement Date;
however, prior to the Term Commencement Date, Landlord shall cause, at
landlord's sole cost and expense, ADA path of travel compliance outside of the
Building and provided further Landlord and not Tenant shall be responsible for
ADA compliance work exterior to the building triggered by the Tenant
Improvements which Landlord was obligated to comply with on the Commencement
Date. Tenant shall promptly reimburse Landlord for any costs incurred by
Landlord with respect thereto. If not otherwise paid for by Tenant, Landlord
shall be entitled to deduct from Landlord's Contribution any amount incurred by
Landlord with respect to ADA compliance work triggered by the Tenant
Improvements.

          (c)  In the event any of the Basic Operating Costs are riot allocable
solely to the Building or are not provided on a uniform basis, Landlord shall
make an appropriate and equitable adjustment, in Landlord's sole and absolute
discretion, to the relevant cost allocations to the Building and Tenant shall
pay its proportionate share of such Basic Operating Costs allocable solely to
the Building and 100% of such Basic Operating Costs allocable solely to the
Leased Premises.

          (d)  [Intentionally deleted.]

          (e)  The following items shall be excluded from Basic Operating Costs:
(i) depreciation on the Building and the Project; (ii) [intentionally deleted] ;
(iii) [intentionally deleted] ; (iv) [intentionally deleted] ; (v) the cost of
any improvements or equipment which would be properly classified as capital
expenditures under generally accepted accounting principles (except for any
capital expenditures expressly included in Section 3.05(a), including, without
                                           ---------------
limitation, Section 3.05(a)(11)); (vi) [intentionally deleted]; (vii)
            ---------------------
[intentionally deleted]; (viii) [intentionally deleted]; (ix) interest,
principal, points and fees, amortization or other costs associated with any debt
and rent payable under any lease to which this Lease is subject and all costs
and expenses associated with any such debt or lease and ground lease rent,
irrespective of whether this Lease is subject or subordinate thereto; (x)
depreciation or amortization, other than as specifically enumerated above in the
definition of Basic Operating Costs; (xi) expenses for any item or service which
Tenant pays directly to a third party or separately reimburses Landlord and
expenses incurred by Landlord to the extent the same are reimbursed from any
other tenants, occupants of the property, or third parties;

                                       11
<PAGE>

(xii) costs of any item, service or other benefit of a type which are not
available to Tenant but which are available to other tenants or occupants, and
costs for which Landlord is reimbursed by other tenants of the Building other
than through payment of tenants' shares of Basic Operating Costs; (xiii) costs
of special services rendered to individual tenants (including tenant) for which
a special charge is made; (xiv) expenses incurred by Landlord to prepare,
renovate, repaint, improve, redecorate or perform any other work in any space
leased to an existing tenant or prospective tenant of the Building; (xv)
expenses incurred by Landlord to lease space to new tenants or to retain
existing tenants including leasing commissions, advertising and promotional
expenditures; (xvi) increases in real property taxes of the Property to the
extent that they constitute real property taxes assessed on improvements to the
Property for other tenants or for construction of new buildings; (xiii) costs
and expenses related to the operation of any commercial concession at the
Building when such commercial concessions are not for the benefit of the
Building; (xiv) charges, including applicable taxes, for electricity, steam,
water and other utilities for which Landlord is entitled to separate
reimbursement from any third party, including without limitation, any other
tenant of the Building; (xx) costs for which Landlord has been directly
compensated from other sources; (xxi) any expenses for repairs or maintenance
which are reimbursed from third parties through warranties or service contracts
or otherwise; (xxii) expenses for the replacement of any item installed by
Landlord covered under warranty; (xxiii) Landlord's general overhead and general
administrative expenses, including without limitation, the salaries of any
officer of Landlord other than as provided in Section 3.05(a): (xxiv) salaries
                                              ---------------
of (i) employees above the grade of building superintendent or building manager,
and (ii) that portion of employee expenses for employees whose time is not spent
directly and solely in the operation of the Property; (xxv) the cost of supplies
and services provided by subsidiaries and affiliates of Landlord in excess of
those provided by independent suppliers and contractors of comparable buildings
within in the vicinity of the Property; (xxvi) any portion of any cost which
represents a profit to or a surcharge by Landlord; (xxvii) costs incurred by
Landlord to perform or correct any repairs, capital additions, alterations,
replacements or other costs of correcting latent or patent defects in the
design, materials, equipment, workmanship or construction of the Building,
excluding Tenant Improvements; (xxviii) the costs of any items (including but
not limited to, costs of repair or reconstruction of any portion of the
Building) for which Landlord is entitled to reimbursement from insurance carried
by Landlord; (xxix) expenses incurred by Landlord for repairs or other work
occasioned by fire, windstorm, or other insurable casualty or condemnation for
which Landlord is required to maintain insurance hereunder excluding any
deductible; (xxx) costs necessitated by or resulting from the negligence or
willful misconduct of Landlord, its vendors, agents, employees and/or
independent contractors; (xxxi) any and all costs incurred by Landlord to comply
with state, federal, local law, regulation and/or ordinance, except as otherwise
provided in this Lease; (xxxii) costs, fines, interest or penalties incurred due
to Landlords violation of any law or governmental regulation; (xxxiii)
Landlord's incremental costs incurred by reason of Landlord's breach of any
leases in the Building and any costs incurred by reason of the breach by other
tenants in the Building; (xxxiv) leasing commissions, incurred by Landlord to
resolve disputes, enforce or negotiate lease terms with other tenants,
prospective tenants or occupants of the Property, or in connection with the
enforcement or violation by Landlord or such tenant or occupant of any lease;
(xxxv) attorneys' fees, brokerage fees and other expenses, incurred in
connection with any financing, sale or syndication of the Property; (xxxvi) the
operating expenses incurred by Landlord relative to retail stores, hotels and
any specialty service in the Building or on the Property; (xxxvii) advertising
and promotional expenditures and costs of signs in or on the Building
identifying the owner of the Building or other tenant's signs; (xxxviii) costs
arising from Landlord's charitable or political contributions; (xxxix) reserves;
(xxxx) any costs incurred in connection with any "year 2000" glitches; and,
(xxxxi) other items not customarily included as operating expenses for similar
buildings. The determination of Basic Operating Costs shall be in accordance
with generally accepted accounting principles consistently applied.

                                       12
<PAGE>

                                  Article 4.
                             Landlord's Covenants

     4.01. Basic Services. Landlord shall operate the Project to a standard of
quality consistent with that of other similar-class office projects in the
immediate geographical area, and shall:

           (a) Timely administer improvement of the Leased Premises in
accordance with Exhibit B (if any).
                ---------

           (b) Furnish Tenant during Tenant's occupancy of the Leased Premises
the following basic services:

               (i)    Hot and cold water at those points of supply provided for
general use of other tenants in the Project; central heat and air conditioning
in season, during the Building hours of operation specified in the rules and
regulations for the Project adopted pursuant to Section 5.17 and at such
                                                ------------
temperatures and in such amounts as are considered by Landlord to be standard
for the comfortable use and occupancy of the Leased Premises or, in all events,
as may be permitted or controlled by applicable laws, ordinances, rules and
regulations.

               (ii)   Structural and exterior maintenance (including exterior
glass and glazing) and routine maintenance, repairs and electric lighting
service for all public areas and service areas of the Project in the manner and
to the extent deemed by Landlord to be standard.

               (iii)  [Intentionally deleted.]

               (iv)   [Intentionally deleted.]

               (v)    Exterior Building Standard lamps, bulbs, starters and
ballasts used in the Leased Premises.

               (vi)   Elevator service.

           (c) Landlord shall not be liable for damages to either person or
property, nor shall Landlord be deemed to have evicted Tenant, nor shall there
be any abatement of Rent, nor shall Tenant be relieved from performance of any
covenant on its part to be performed under this Lease by reason of any (i)
deficiency in the provision of basic services; (ii) breakdown of equipment or
machinery utilized in supplying services; or (iii) curtailment or cessation of
services due to causes or circumstances beyond the reasonable control of
Landlord or by the making of the necessary repairs or improvements, unless such
deficiency, breakdown, curtailment or cessation is due to the negligence or
willful misconduct of Landlord. Landlord shall use reasonable diligence to make
such repairs as may be required to machinery or equipment within the Project to
provide restoration of services and, where the cessation or interruption of
service has occurred due to circumstances or conditions beyond Project
boundaries, to cause the same to be restored, by diligent application or request
to the provider thereof Due to the unique nature of Tenant's business, Landlord
acknowledges that time is of the essence in providing the above services.

           (d) Notwithstanding anything in this Lease to the contrary, Tenant
may contract directly for all utilities with the respective local utility
company and Tenant may contract directly for janitorial services with Basic
Operating Costs being adjusted accordingly.

                                       13
<PAGE>

           (e) Landlord warrants arid represents to Tenant that on the Term
Commencement Date the Leased Premises shall be in full compliance with all
applicable federal, state, and local laws, rules, regulations and orders
including environmental laws and building codes. With respect to the American
With Disabilities Act, as of the Term Commencement Date, Landlord shall cause
the path of travel outside the Leased Premises to be ADA compliant with all such
costs of compliance to be home by Landlord. The foregoing notwithstanding, this
representation and warranty shall terminate upon the sale of the Project in an
arm's-length transaction between unrelated parties unless the purchaser(s)
acquires the Project with knowledge of any dispute between Tenant and Landlord
regarding the above representation and warranty but in no event shall it
terminate sooner than completion of the initial Tenant Improvements.

     4.02. Extra Services. Landlord shall provide to Tenant at Tenant's sole
cost and expense (and subject to the limitations hereinafter set forth) the
following extra services:

           (a) Such extra, cleaning and janitorial services required if Tenant
Improvements necessitate extra cleaning efforts;

           (b) Additional air conditioning and ventilating capacity required by
reason of any electrical, data processing or other equipment, facilities or
services required to support the same, in excess of that which would be required
for Building Standard Improvements, when prearranged with Landlord;

           (e) Heating, ventilation, air conditioning, lighting or extra
electrical service provided by Landlord to Tenant during hours other than the
Building hours of operation specified in the rules and regulations for the
Project adopted pursuant to Section 5.17, which shall provide for Building hours
                            ------------
of operation of 7:00 am. to 7:00 p.m., Monday through Friday (excluding
holidays);

           (d) Maintaining and replacing non-Building Standard lamps, bulbs,
starters and ballasts (whether or not the light fixtures were installed as part
of the Tenant Improvements) which Tenant requests Landlord to replace;

           (e) Repair and maintenance service which is the obligation of Tenant
under this Lease which Tenant fails to repair after prior notice;

           (f) Repair, maintenance or janitorial service to the Leased Premises,
the Common Areas or the Project parking area which is required as a result of
the acts or omissions of tenant, its agents, employees, contractors, invitees or
licensees; and

           (g) Any basic service in amounts reasonably determined by Landlord to
exceed the amounts required to be provided under Section 4.01(b), but only if
                                                 ---------------
Landlord elects to provide such additional or excess service and notifies Tenant
of such additional charges in advance of Tenant's use.

           The cost chargeable to Tenant for all extra services shall constitute
Additional Rent and shall include a management fee payable to Landlord to be
negotiated in advance by Landlord and Tenant. Additional Rent shall be paid
monthly by Tenant to Landlord concurrently with the payment of Base Rent.

     4.03. Window Coverings. Tenant shall not place or maintain any exterior
window coverings, blinds, curtains or drapes without Landlord's prior written
approval, which consent shall not be unreasonably withheld; conditioned or
delayed that are not otherwise specified in Tenant's Plans.

                                       14
<PAGE>

     4.04. Graphics and Signage. Tenant shall have the right, at Tenant's sole
expense, to Building parapet and/or "eyebrow" signage for corporate
identification and/or monument signage (on either or both of the monuments along
Gibraltar Drive and West Las Positas Drive). The location, design, content and
size of such signage shall be subject to Landlord's reasonable approval and be
consistent with the development agreement, if any, exiting between Landlord, the
City of Pleasanton and the Hacienda Business Park Owners Association or such
other preexisting signage criteria. Landlord shall cooperate fully with Tenant
in securing such signage rights; however, the costs of design, fabrication,
installation, permitting and restoration shall be home by Tenant. Tenant shall
have the right to use its standard corporate logo/graphics at the entrance to
the Leased Premises and in each of the building lobbies, subject to Landlord's
reasonable approval. All other signs, notices, advertisements and graphics of
every kind or character, visible in or from the exterior of the Leased Premises
shall be subject to Landlord's prior written approval, which shall not be
unreasonably withheld. Landlord may remove, without notice to and at the expense
of Tenant, any sign, notice, advertisement or graphic of any kind inscribed,
displayed or affixed in violation of the foregoing requirement if Tenant fails
to removal such nonconforming signage after notice. Landlord shall be entitled
to revise the Project graphics and signage standards at any time, at Landlord's
sole expense.

     4.05. [Intentionally deleted.]

     4.06. Repair Obligation. Landlord shall maintain the Building in good
condition and repair comparable to other buildings in Hacienda Business Park and
shall not unreasonably defer any repair, maintenance or replacement expenses.
Landlord's obligation with respect to maintenance and repair shall be limited to
(i) the structural portions of the Building; (ii) the exterior walls of the
Building, including exterior glass and glazing; (iii) the exterior roof; (iv)
Landlord mechanical, electrical, plumbing and life safety systems; (v) the
Common Areas; (vi) the Project parking area; and (vii) landscaped areas.
However, Landlord shall not have any obligation to repair damage caused by
Tenant, its agents, employees, contractors, invitees or licensees. Landlord
shall have the right, but not the obligation, to undertake work of repair which
Tenant is required to perform under this Lease and which Tenant fails or refuses
to perform in a timely and efficient manner after notice from Landlord. Tenant
shall reimburse Landlord upon demand, as Additional Rent, for all costs incurred
by Landlord in performing any such repair for the account of Tenant, together
with an amount equal to fifteen percent (15%) of such costs to reimburse
Landlord for its administration and managerial effort Except as specifically set
forth in this Lease, Landlord shall have no obligation whatsoever to maintain or
repair the Leased Premises or the Project. The parties intend that the terms of
this Lease govern their respective maintenance and repair obligations. Tenant
expressly waives the benefit of any statute now or hereafter in effect to the
extent it is inconsistent with the terms of this Lease with respect to such
obligations or which affords Tenant the right to make repairs at the expense of
Landlord or terminate this Lease by reason of the condition of the Leased
Premises or any needed repairs.

     4.07. Peaceful Enjoyment. Landlord covenants with Tenant that upon Tenant
paying the Rent and all other charges required under this Lease and performing
all of Tenant's material covenants and agreements herein contained, Tenant shall
peacefully have, hold and enjoy the Leased Premises subject to all of the terms
of this Lease and to any deed of trust, mortgage, ground lease or other
agreement to which this Lease may be subordinate. This covenant and the other
covenants of Landlord contained in this Lease shall be binding upon Landlord and
its successors only with respect to breaches occurring during its or their
respective ownerships of Landlord's interest hereunder and binding on those
successors who have knowledge of the prior Landlord's breaches.

                                       15
<PAGE>

                                  Article 5.
                              Tenant's Covenants

     5.01. Payments by Tenant. Tenant shall pay Rent at the times and in the
manner provided in this Lease. All obligations of Tenant hereunder to make
payments to Landlord shall constitute Rent and failure to pay the same when due
shall give rise to the rights and remedies provided for in Section 7.08. If
                                                           ------------
there is more than one Tenant, the obligations imposed under this Lease upon
Tenant shall be joint and several.

     5.02. Tenant Improvements. The Tenant Improvements shall be installed and
constructed by Tenant pursuant to Exhibit B. All Tenant Improvements, other than
                                  ---------
all furniture, equipment, trade fixtures, such items that are easily removable
by Tenant and the items specifically described on Exhibit B Schedule 3 which
                                                  --------------------
Landlord and Tenant specifically agree and covenant shall belong to Tenant,
shall become the property of Landlord upon installation and shall be surrendered
to Landlord without compensation to Tenant upon termination of this Lease by
lapse of time or otherwise, subject to Landlord's right to require their removal
in the same manner as provided in Section 5.07.
                                  ------------

     5.03. Taxes on Personal Property. In addition to, and wholly apart from its
obligation to pay Tenant's Proportionate Share of Basic Operating Costs, Tenant
shall be responsible for, and shall pay prior to delinquency, all taxes or
governmental service fees, possessory interest taxes, fees or charges in lieu of
any such taxes, capital levies, and any other charges imposed upon, levied with
respect to, or assessed against Tenant's personal property and on its interest
pursuant to this Lease. 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.

     5.04. Repairs by Tenant. Tenant shall be obligated to maintain and repair
the Leased Premises, to keep the same at all times in good order, condition and
repair, and, upon expiration of the Term, to surrender the same to Landlord in
the same condition as on the Term Commencement Date, reasonable wear and tear,
taking by condemnation, and damage that is Landlord's responsibility under
Section 7.07 not caused by Tenant, its agents, employees, contractors, invitees
------------
and licensees excepted. Tenant's obligations shall include, without limitation,
the obligation to maintain and repair all walls, floors, ceilings and fixtures
and to repair all damage caused by Tenant, its agents, employees, contractors,
invitees and others using the Leased Premises with Tenant's expressed or implied
permission. In no event shall Tenant be obligated to make any repairs
necessitated by, or to repair damage due, in whole or in part, to any act,
omission or negligence of Landlord or Landlord's agents, employees, licensees or
contractors. At the written request of Tenant, Landlord shall perform the work
of maintenance and repair constituting Tenant's obligation under this Section
                                                                      -------
5.04 at Tenant's sole cost and expense and as an extra service to be rendered
----
pursuant to Section 4.02(e). Any work of repair and maintenance performed by or
            ---------------
for the account of Tenant by persons other than Landlord shall be performed by
contractors approved by Landlord and in accordance with procedures Landlord
shall from time to time establish, which approval shall not be unreasonably
withheld. Tenant shall give Landlord prompt notice of any damage to or defective
condition in any part of the Building's mechanical, electrical, plumbing, life
safety or other system servicing, located in or passing through the Leased
Premises. Tenant shall have the right, but not the obligation, to undertake work
of repair which Landlord is required to perform under this Lease and which
Landlord fails or refuses to perform in a timely and efficient manner after
notice from Tenant. Landlord shall reimburse Tenant upon demand unless Landlord
disputes Landlord's obligation. In the event of such dispute, then such dispute
shall be submitted to arbitration in accordance with the terms of Exhibit F
                                                                  ---------
attached hereto. In the event the arbitrator finds in its written decision in
Tenant's favor and Landlord fails to pay Tenant, then Tenant may offset Rent up
to the amount of the arbitrator's award, together with an amount equal to
fifteen percent (15%) of such costs to reimburse Tenant for its administration
and managerial effort.

                                       16
<PAGE>

     5.05. Waste. Tenant shall not commit or allow any waste or damage to be
committed in any portion of the Leased Premises or the Project.

     5.06. Assignment or Sublease.

           (a) Tenant shall not voluntarily or by operation of law assign,
transfer or encumber (collectively "Assign") or sublet all or any part of
Tenant's interest in this Lease or in the Leased Premises without Landlord's
prior written consent given under and subject to the terms of this Section 5.06.
                                                                   ------------
Notwithstanding the foregoing, the Tenant may, upon notice to the Landlord, in
whole or in part, sublet the Leased Premises, or Assign this Lease to (i) an
affiliate or subsidiary of the Tenant, or (ii) an entity arising as a result of
merger, acquisition or consolidation, so long as Tenant shall remain responsible
in case of default, and, provided, further, no such permitted subletting or
assignment shall relieve the Tenant of liability under this Lease.

           (b) Except as permitted in Section 5.06(a), if tenant desires to
                                      ---------------
Assign this Lease or any interest herein or sublet the Leased Premises or any
part thereof, Tenant shall give Landlord written notice of such intent. Tenant's
notice shall specify the date the proposed assignment or sublease would be
effective and be accompanied by information pertinent to Landlord's
determination as to the financial and operational responsibility and
appropriateness of the proposed assignee or subtenant, including, without
limitation, its name, business and financial condition, financial details of the
proposed transfer, the intended use (including any modification) of the Leased
Premises, and exact copies of all of the proposed agreement(s) between Tenant
and the proposed assignee or subtenant. Tenant shall promptly provide Landlord
with (i) such other or additional information or documents reasonably requested
(within ten (10) days after receiving Tenant's notice) by Landlord, and (ii) an
opportunity to meet and interview the proposed assignee or subtenant, if
requested by Landlord.

           (c) Landlord shall have a period of ten (10) days following such
interview and receipt of such additional information (or fifteen (15) days from
the date of Tenant's original notice if Landlord does not request additional
information or an interview) within which to notify Tenant in writing whether or
not Landlord consents to the request by Tenant to Assign this Lease or sublet
such space, such consent not to be unreasonably withheld, conditioned or
delayed, so long as the use of the Leased Premises by such proposed assignee or
sublessee would be a Permitted Use, the proposed assignee or sublessee is of
sound financial condition as determined by Landlord in its reasonable
discretion, the proposed assignee or sublessee executes such reasonable
assumption documentation as Landlord shall require, and the proposed assignee or
sublessee is not (x) already a tenant in the Building or (y) a party with whom
Landlord has been actively discussing the leasing of space in the Building.
Failure by Landlord to approve a proposed subtenant or assignee shall not cause
a termination of this Lease.

           (d) In the event Tenant shall request the consent of Landlord to any
assignment or subletting hereunder, Tenant shall pay Landlord a processing fee
of $250.00 and shall reimburse Landlord for Landlord's reasonable attorneys'
fees incurred in connection therewith. All such fees shall be deemed Additional
Rent under this Lease.

           (e) Any rent or other consideration realized by Tenant under any such
sublease or assignment in excess of the (i) the Rent for the space being sublet
or assigned; (ii) tenant improvement costs incurred in connection with the
sublease and the remaining unamortized tenant improvement costs remaining at the
time of the sublease or assignment; (iii) brokerage commissions; (iv) reasonable
sublease marketing

                                       17
<PAGE>

expenses; and (v) reasonable legal fees associated with such assignment or
sublease, shall be divided and paid as follows: forty percent (40%) to Tenant
and sixty percent (60%) to Landlord.

           (f) [Intentionally deleted.]

           (g) The consent of Landlord to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting by Tenant or to
any subsequent or successive assignment or subletting by the assignee or
subtenant. However, Landlord may consent to subsequent assignments and
sublettings of the Lease or sublease or amendments or modifications thereto,
without notifying Tenant or any other party liable on the Lease or sublease and
without obtaining their consent. Such action shall not relieve Tenant or any
such other party from liability under this Lease or a sublease.

           (h) No assignment or subletting by Tenant shall relieve Tenant of any
obligation under this Lease. In the event of default by an assignee or subtenant
of Tenant or any successor of Tenant in the performance of any of the terms
hereof, Landlord may proceed directly against Tenant without the necessity of
exhausting remedies against such assignee, subtenant or successor. Any
assignment or subletting which conflicts with the provisions hereof shall be
void and, at Landlord's option, shall constitute a default under this Lease.

     5.07. Alterations, Additions and Improvements.

           (a) Tenant shall not make or allow to be made any alterations or
additions in or to the Leased Premises without first obtaining the written
consent of Landlord, except for such alterations or additions for which a
building permit is not required or are not material in mature. Landlord's
consent will not be unreasonably withheld, conditioned or delayed with respect
to proposed alterations and additions which (i) comply with all applicable laws,
ordinances, rules and regulations; (ii) are compatible with and does not
adversely affect the Building and its mechanical, electrical, HVAC and life
safety systems; (iii) will not adversely affect the structural portions of the
Building; (iv) will not interfere with the use and occupancy of any other
portion of the Building by any other tenant, its employees or invitees; and (v)
will not trigger any additional costs to Landlord. Specifically, but without
limiting the generality of the foregoing, Landlord's right of consent shall
encompass plans and specifications for the proposed alterations or additions,
construction means and methods, the identity of any contractor or subcontractor
to be employed on the work of alterations or additions, and the time for
performance of such work. Tenant shall supply to Landlord any additional
documents and information reasonably requested by Landlord in connection with
Tenant's request for consent hereunder.

           (b) Any consent given by Landlord under this Section 5.07 shall be
                                                        ------------
deemed conditioned upon: (i) Tenant's acquiring all applicable permits required
by governmental authorities; (ii) Tenant's furnishing to Landlord copies of such
permits, together with copies of the approved plans and specifications, prior to
commencement of the work thereon; and (iii) the compliance by Tenant with the
conditions of all applicable permits and approvals in a prompt and expeditious
manner.

           (c) Tenant shall provide Landlord with not less than five (5)
business days prior written notice of the work, unless in the event of an
emergency then Tenant shall use its best efforts to provide prior notice (and
shall provide notice thereafter as soon as practical) to Landlord, so as to
enable Landlord to post and record appropriate notices of non-responsibility.
All alterations and additions permitted hereunder shall be made and performed by
Tenant without cost or expense to Landlord. Tenant shall pay the contractors and
suppliers all amounts due to them when due and keep the Leased Premises and the
Project free from any and all mechanics', materialmen's and other liens and
claims arising out of any

                                       18
<PAGE>

work performed, materials furnished or obligations incurred by or for Tenant. In
the event that the estimated cost of such alterations or additions exceed One
Million Dollars ($1,000,000) (excluding those improvements to be made by Tenant
prior to the Term Commencement Date) or in the event that Tenant is in monetary
default hereunder, Landlord may require, at its sole option, that Tenant provide
to Landlord, at Tenant's expense, a lien and completion bond in an amount equal
to at least one and one half (1 1/2) times the total estimated cost of any
alterations, additions or improvements to be made in or to the Leased Premises,
to protect Landlord against any liability for mechanics', materialmen's and
other liens and claims, and to ensure timely completion of the work and Landlord
is given the opportunity to post a notice of non responsibility. In the event
any alterations or additions to the Leased Premises are performed by Landlord
hereunder other than the initial Tenant Improvements, whether by prearrangement
or otherwise, Landlord shall be entitled to charge Tenant a five percent (5%)
administration fee in addition to the actual costs of labor and materials
provided. Such costs and fees shall be deemed Additional Rent under this Lease,
and may be charged and payable prior to commencement of the work.

           (d) Any and all alterations, additions or improvements made to the
Leased Premises by Tenant and owned by Tenant, but excluding Tenant's furniture,
trade fixtures, equipment, personal property, telecommunications equipment,
property leased to Tenant and such other property listed on any attachment to
this Lease shall become the property of Landlord upon installation and shall be
surrendered to Landlord without compensation to Tenant upon the termination of
this Lease by lapse of time or otherwise unless (i) Landlord conditioned its
approval of such alterations, additions or improvements on Tenant's agreement to
remove them, or (ii) Landlord notifies Tenant in writing at lease six (6) months
prior to the Term Expiration Date that the alterations, additions and/or
improvements must be removed, in which case Tenant shall, by the Term Expiration
Date (or promptly thereafter), remove such alterations, additions and
improvements, repair any damage resulting from such removal and restore the
Leased Premises to their condition existing prior to the date of installation of
such alterations, additions and improvements. Notwithstanding anything to the
contrary set forth above, this clause shall not apply to movable equipment,
trade fixtures or furniture owned by Tenant. Tenant shall repair at its sole
cost and expense all damage caused to the Leased Premises and the Project by
removal of Tenant's movable equipment, trade fixtures or furniture and such
other alterations, additions and improvements as Tenant shall be required or
allowed by Landlord to remove from the Leased Premises.

           (e) All alterations, additions and improvements permitted under this
Section 5.07 shall be constructed diligently, in a good and workmanlike manner
------------
with good and sufficient materials and in compliance with all applicable laws,
ordinances, rules and regulations (including, without limitation, building codes
and those related to accessibility and use by individuals with disabilities).
Tenant shall, promptly upon completion of the work and when same are available
to Tenant, furnish Landlord with "as built" drawings for any alterations,
additions or improvements performed under this Section 5.07.
                                               ------------

           5.08. Compliance With Laws and Insurance Standards. Tenant shall not
occupy or use, or permit any portion of the Leased Premises to be occupied or
used in a manner that violates any applicable law, ordinance, rule, regulation,
order, permit, covenant, easement or restriction of record, relating in any
manner to the Project, or for any business or purpose which is disreputable,
objectionable or productive of fire hazard. Tenant shall not do or permit
anything to be done which would result in the cancellation, or in any way
increase the cost, of the all risk property insurance coverage on the Project
and/or its contents. Landlord represents that, as of the date of the Lease,
Tenant's intended uses of the Project as described in this Lease will not result
in the cancellation or in any way increase the cost of the all risk property
insurance described above greater than what is commercially reasonable. If
Tenant does or permits, after notice and reasonable opportunity to cure,
anything to be done which increases the cost of any insurance covering or
affecting the Project, then Tenant shall reimburse Landlord, upon demand, as
Additional Rent, for such

                                       19
<PAGE>

additional costs. Landlord shall deliver to Tenant a written statement setting
forth the amount of any such insurance cost increase and showing in reasonable
detail the manner in which it has been computed. Tenant shall, at Tenant's sole
cost and expense, except as otherwise provided hereunder, comply with all laws,
ordinances, rules, regulations and orders (state, federal, municipal or
promulgated by other agencies or bodies having or claiming jurisdiction) related
to the use, condition or occupancy of the Leased Premises now in effect or which
may hereafter come into effect including, but not limited to, (a) accessibility
and use by individuals with disabilities, and (b) environmental conditions in,
on or about the Leased Premises as same relate to Tenant's use and property and
are not subject to Landlord's obligations hereunder. If anything done by Tenant
in its use or occupancy of the Leased Premises shall create, require or cause
imposition of any requirement by any public authority for structural or other
upgrading of or alteration or improvement to the Project, Tenant shall, at
Landlord's option, either perform the upgrade, alteration or improvement at
Tenant's sole cost and expense or reimburse Landlord upon demand, as Additional
Rent, for the cost to Landlord of performing such work, or decide not to
undertake such alteration, if such option is available. With respect only to the
Tenant's initial Tenant Improvements, in the event that significant structural
upgrades in addition to any such upgrades described in Tenant's plans and
specifications are required, that are financially and structurally unreasonable
to complete and no work around can be designed, then Tenant shall have the
option to terminate this Lease. In any event, this right to terminate this Lease
expires on the Gibralter II Term Commencement Date. The final non-appealable
judgment of any court of competent jurisdiction or the admission by Tenant in
any action against Tenant, whether Landlord is a party thereto or not, that
Tenant has violated any law, ordinance, rule, regulation, order, permit,
covenant, easement or restriction shall be conclusive of that fact as between
Landlord and Tenant. Landlord shall be responsible for any path of travel, as
that term is used in Title 24 and the Americans With Disabilities Act
(collectively "ADA"), which is compliant with the requirements of the ADA
outside of the Building and Tenant shall be responsible for any path of travel
inside the Building.

           5.09. No Nuisance; No Overloading. Tenant shall use and occupy the
Leased Premises, and control its agents, employees, contractors, invitees and
visitors in such manner so as not to create any nuisance, or interfere with,
annoy or disturb (whether by noise, odor, vibration or otherwise) any other
tenant or occupant of the Project or Landlord in its operation of the Project.
Tenant shall not place or permit to be placed any loads upon the floors, walls
or ceilings in excess of the maximum designed load specified by Landlord or
which might damage the Leased Premises, the Building, or any portion thereof,
except as otherwise disclosed in Tenant's plans and specifications (where Tenant
has taken steps to address the loading issue) and which have been approved by
Landlord and which approval shall not be unreasonably withheld.

           5.10. Furnishing of Financial Statements; Tenant's Representations.
In order to induce Landlord to enter into this Lease, Tenant agrees that it
shall promptly furnish Landlord, from time to time, as long as they are
available and the recipient executes and delivers to Tenant reasonable
assurances of confidentiality and if Tenant is publicly traded, only such
financial information which is publicly available, within ten (10) business days
of receipt of Landlord's written request therefor, with financial statements in
form and substance reasonably satisfactory to Landlord reflecting Tenant's
current financial condition. Tenant represents and warrants that all financial
statements, records and information furnished by Tenant to Landlord in
connection with this Lease are true, correct and complete in all material
respects.

           5.11. Entry by Landlord. Landlord, its employees, agents and
consultants, shall have the right to enter the Leased Premises at any time, in
cases of an emergency, and otherwise at reasonable times with reasonable advance
notice to inspect the same, to perform such work as may be permitted or required
under this Lease, to make repairs to or alterations of the Leased Premises or
other portions of the Project or 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
show the Leased Premises

                                       20
<PAGE>

to prospective tenants (during the last nine (9) months of the Term),
purchasers, encumbrancers or others, or for any other purpose as Landlord may
deem necessary or desirable; provided, however, that Landlord shall use its best
efforts to minimize interference with Tenant's business operations in the Leased
Premises. Tenant shall not be entitled to any abatement of Rent or damages by
reason of the exercise of any such right of entry. Notwithstanding the
foregoing, except in cases of an emergency, Landlord, its employees, agents and
consultants, shall not enter the Leased Premises unless accompanied by a
representative of Tenant and Landlord shall cooperate with any reasonable
security procedures of Tenant.

     5.12. Nondisturbance and Attornment.

           (a) This Lease and the rights of Tenant hereunder shall be subject
and subordinate to the lien of any deed of trust, mortgage or other
hypothecation or security instrument affecting the Landlord's property
(collectively, "Security Device") now or hereafter placed upon, affecting or
encumbering the Project or any part thereof or interest therein, and to any and
all advances made thereunder, interest thereon or costs incurred and any
modifications, renewals, supplements, consolidations, replacements and
extensions thereof. With respect to any Security Device entered into by Landlord
after execution of this Lease, such subordination is conditioned on Landlord
obtaining and delivering to Tenant assurance in a commercially reasonable form
(a "nondisturbance agreement") from the holder of or beneficiary under such
encumbrance that Tenant's possession will not be disturbed, that Tenant will
continue to enjoy all rights and privileges of whatsoever kind granted to Tenant
under this Lease and that such new holder or beneficiary shall abide by the
terms of this Lease so long as Tenant is not in material default under this
Lease and attorns to the record owner of the Leased Premises. Landlord shall
obtain and deliver to Tenant a nondisturbance agreement from Fleet National Bank
in the form attached hereto as Exhibit E within ten (10) business days of full
                               ---------
execution of this Lease, and if not delivered within 20 days Tenant has the
right to terminate the Lease. Without the consent of Tenant, the holder of any
such Security Device or the beneficiary thereunder shall have the right to elect
to be subject and subordinate to this Lease, such subordination to be effective
upon such terms and conditions as such holder or beneficiary may direct which
are not inconsistent with the provisions hereof. Tenant agrees to attorn to and
recognize as the Landlord under this Lease the holder or beneficiary under a
Security Device or any other party that acquires ownership of the Leased
Premises by reason of a foreclosure or sale under any Security Device (or deed
in lieu thereof). The new owner following such foreclosure, sale or deed 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.

           (b) Tenant shall not unreasonably withhold its consent to reasonable
changes or amendments to this Lease requested by the holder of a Security Device
so long as these changes do not alter the basic business terms of this Lease or
otherwise materially diminish any rights or materially increase any obligations
of Tenant hereunder. If, within fifteen (15) days after notice from Landlord,
Tenant fails or unreasonably refuses to execute with Landlord the amendment(s)
to this Lease accomplishing the reasonable change(s) or amendment(s) which are
requested by such holder such amendments shall be deemed accepted and shall be
enforceable by Landlord and such lender and binding upon Tenant, its successors
and assigns as if agreed to in writing, without need of further action or
documentation unless Tenant is disputing the reasonableness of such amendments
in which case the Landlord and Tenant shall negotiate in good faith to agree
upon such changes.

     5.13. Estoppel Certificate. Within ten (10) business days following
Landlord's request, Tenant shall execute, acknowledge and deliver written
estoppel certificates addressed to (i) any mortgagee or prospective mortgagee of
Landlord, or (ii) any purchaser or prospective purchaser of all or any portion
of,

                                       21
<PAGE>

or interest in, the Project, on a form specified by Landlord, certifying as to
such facts (if true) and agreeing to such notice provisions and other matters as
such mortgagee(s) or purchaser(s) may reasonably require, including, without
limitation, the following: (a) that this Lease is unmodified and in full force
and effect (or in full force and effect as modified, and stating the
modifications); (b) the amount of, and date to which Rent and other charges have
been paid in advance; (c) the amount of any Security Deposit; and (d)
acknowledging that Landlord is not in default under this Lease (or, if Landlord
is claimed to be in default, stating the nature of the alleged default).
However, in no event shall any such estoppel certificate require an amendment of
the provisions of this Lease or otherwise affect or abridge Tenant's rights
hereunder. Any such estoppel certificate may be relied upon by any such
mortgagee or purchaser. Failure by Tenant to execute and deliver any such
estoppel certificate within the time requested shall, at Landlord's election, be
conclusive upon Tenant that (1) this Lease is in full force and effect and has
not been modified except as represented by Landlord; (2) not more than one
month's Rent has been paid in advance; and (3) Landlord is not in default under
this Lease. Within ten (10) business days following Tenant's request, Landlord
shall execute, acknowledge and deliver written estoppel certificates addressed
to (i) any mortgagee or prospective mortgagee of Tenant, or (ii) any purchaser
or prospective purchaser of all or any portion of, or interest in Tenant, on a
form specified by Tenant, certifying as to such facts (if true) and agreeing to
such notice provisions and other matters as such mortgagee(s) or purchasers) may
reasonably require, including, without limitation, the following: (a) that this
Lease is unmodified and in full force and effect (or in full force and effect as
modified, and stating the modifications); (b) the amount of, and date to which
Rent and other charges have been paid in advance; (c) the amount of any Security
Deposit; and (d) acknowledging that Tenant is not in default under this Lease
(or, if Tenant is claimed to be in default, stating the nature of the alleged
default). However, in no event shall any such estoppel certificate require an
amendment of the provisions of this Lease or otherwise affect or abridge
Landlord's rights hereunder. Any such estoppel certificate may be relied upon by
any such mortgagee or purchaser. Failure by Landlord to execute and deliver any
such estoppel certificate within the time requested shall, at Tenant's election,
be conclusive upon Landlord that (1) this Lease is in full force and effect and
has not been modified except as represented by Tenant; (2) not more than one
month's Rent has been paid in advance; and (3) Tenant is not in default under
this Lease.

     5.14. Security Deposit.

           (a) As security for the full and faithful performance of Tenant's
obligations under this Lease, Tenant shall provide Landlord with a security
deposit (the "Security Deposit"), which shall consist of the cash payment
described in Section 5.14(b) below (the "Temporary Security Deposit"), and the
             ---------------
letter of credit (the "Letter of Credit") described in Section 5.14(d) and (e)
                                                       ---------------     ---
below.

           (b) On or before the Commencement Date, Tenant shall, as security for
the full and faithful performance of Tenant's obligations under this Lease,
deliver to Landlord the Temporary Security Deposit which shall consist of a cash
payment equal to $418,000. Provided that Tenant has timely paid, as required
under the Lease, Landlord the Base Rent due during the first thirteen (13)
months of the term of the Lease, Landlord shall, within five (5) days following
the payment by Tenant of the thirteenth (13/th/) month's rent, refund to Tenant,
in cash, without demand by Tenant, fifty percent (50%) of the Temporary Security
Deposit; and, provided that Tenant has timely paid Landlord the Base Rent due
during the first twenty-five (25) months of the term of the Lease, within five
(5) days following the payment by Tenant of the twenty-fifth (25/th/) month's
rent, refund to Tenant, in cash, without demand by Tenant, the balance of the
Temporary Security Deposit.

           (c) If at any time during the Term, Tenant shall be in a monetary
default in the payment of Rent, Landlord may use, apply or retain all or part of
the Security Deposit for payment of any amount due

                                       22
<PAGE>

Landlord or to cure such default or to reimburse or compensate Landlord for any
liability, loss, cost, expense or damage (including attorneys' fees) which
Landlord may suffer or incur by reason of Tenant's defaults. If Landlord uses or
applies all or any part of the Security Deposit, Tenant shall, on demand, pay to
Landlord a sum sufficient to restore the Security Deposit to the full amount
required by this Lease. Upon expiration of the Term or earlier termination of
this Lease and after Tenant has vacated the Leased Premises, Landlord shall
return the Security Deposit to Tenant, reduced by such amounts as may be
required by Landlord to remedy defaults on the part of Tenant in the payment of
Rent, to repair damages to the Leased Premises caused by Tenant and to clean the
Leased Premises. The portion of the deposit not so required shall be paid over
to Tenant (or, at Landlord's option, to the last assignee of Tenant's interest
in this Lease) within thirty (30) days after expiration of the Term or earlier
termination hereof. Landlord shall hold the Security Deposit for the foregoing
purposes; provided, however, that Landlord shall have no obligation to segregate
the Security Deposit from its general funds or to pay interest in respect
thereof. No part of the Security Deposit shall be considered to be held in
trust, or to be prepayment of any monies to be paid by Tenant under this Lease.

           (d) Within ten (10) days following the full execution of this Lease,
Tenant shall deliver to Landlord a clean and irrevocable Letter of Credit (the
"Letter of Credit") issued by and drawable upon (said issuer being referred to
as the "Issuing Bank") a financial institution which is approved by Landlord in
its sole discretion, provided that Landlord shall not unreasonably withhold its
consent to an Issuing Bank which has outstanding unsecured, uninsured and
unguaranteed indebtedness, or shall have issued a letter of credit or other
credit facility that constitutes the primary security for any outstanding
indebtedness (which is otherwise uninsured and unguaranteed), that is then
rated, without regard to qualification of such rating by symbols such as "+" or
"-" or numerical notation, "Aa" or better by Moody's Investors Service and "AA"
or better by Standard & Poor's Rating Service, and has combined capital, surplus
and undivided profits of not less than One Hundred Million Dollars
($100,000,000). Such Letter of Credit shall (a) name Landlord as beneficiary,
(b) be in the amounts specified hereinafter, (c) have a term of not less than
one year, (d) permit multiple drawings, (e) be fully transferable by Landlord,
and (f) otherwise be in form and content reasonably satisfactory to Landlord. If
upon any transfer of the Letter of Credit, any fees or charges shall be so
imposed, then such fees or charges shall be payable solely by Tenant on no more
than two (2) transfers and the Letter of Credit shall so specify. Except as
otherwise provided hereinafter, the Letter of Credit shall provide that it shall
be deemed automatically renewed, without amendment, for consecutive periods of
one year each thereafter during the Term unless the Issuing Bank sends a notice
(the "Non-Renewal Notice") to Landlord by certified mail, return receipt
requested, not less than 45 days next preceding the then expiration date of the
Letter of Credit stating that the Issuing Bank has elected not to renew the
Letter of Credit. Landlord shall have the right, upon receipt of the Non-Renewal
Notice (unless such Non-Renewal Notice is for a period after the Term Expiration
Date), to draw the full amount of the Letter of Credit, by sight draft on the
Issuing Bank, and shall thereafter hold or apply the cash proceeds of the Letter
of Credit pursuant to the terms of this Article. The Issuing Bank shall agree
with all drawers, endorsers and bona fide holders that drafts drawn under and in
compliance with the terms of the Letter of Credit will be duly honored upon
presentation to the Issuing Bank at an office location in San Francisco. The
Letter of Credit shall be subject in all respects to the Uniform Customs and
Practice for Documentary Credits (1993 revision), International Chamber of
Commerce Publication No. 500.

           (e) The Letter of Credit shall initially be in the amount of One
Million Dollars ($1,000,000), but on or before October 1, 1999, Tenant shall
increase the amount of the Letter of Credit by Three Million Dollars
($3,000,000), for a total of Four Million Dollars ($4,000,000). In the event of
a monetary default by Tenant, following the expiration of any applicable cure
periods as set forth in the Lease, Landlord may make a demand upon the Letter of
Credit to cure said monetary default. The Letter of Credit shall be renewed
annually by Tenant, at Tenant's sole expense. Tenant shall maintain the Letter
of Credit

                                       23
<PAGE>

in the amount of Four Million Dollars ($4,000,000) for the first two years of
the term of the Lease; the amount shall be reduced to Three Million Fifty
Thousand Dollars ($3,050,000) for the third year of the term of the Lease, to
Two Million One Hundred Thousand Dollars ($2,100,000) for the fourth year of the
term of the Lease, and to One Million One Hundred Fifty Thousand Dollars
($1,150,000) for the fifth year of the term of the Lease; and Tenant shall
maintain the Letter of Credit in the amount of Two Hundred Thousand Dollars
($200,000) for the balance of the initial term of the Lease. In the event of any
extension of the term of the Lease beyond the initial term, no Letter of Credit
shall be required of Tenant.

     5.15. Surrender.

           (a) Subject to the provisions of Section 5.07 hereof, on the Term
                                            ------------
Expiration Date (or earlier termination of this Lease), Tenant shall quit and
surrender possession of the Leased Premises to Landlord in as good order and
condition as they were in on the Term Commencement Date, reasonable wear and
tear, damage by casualty, taking by condemnation and repairs which are
Landlord's responsibility excepted. Reasonable wear and tear shall not include
any damage or deterioration that reasonably could have been prevented by good
maintenance practice or by Tenant performing all of its obligations under this
Lease. Tenant shall, without cost to Landlord, remove all furniture, equipment,
trade fixtures, debris and articles of personal property owned by Tenant in the
Leased Premises, and shall repair any damage to the Project resulting from such
removal. Any such property not removed by Tenant, or are not actively in the
process of being removed by the Term Expiration Date (or earlier termination of
this Lease) shall be considered abandoned, and Landlord may remove any or all of
such items and dispose of same in any lawful manner or store same in a public
warehouse or elsewhere for the account and at the expense and risk of Tenant. If
Tenant shall fail to pay the cost of storing any such property after storage for
thirty (30) days or more, Landlord may sell any or all of such property at
public or private sale, in such manner and at such times and places as Landlord
may deem proper, without notice to or demand upon Tenant. Landlord shall apply
the proceeds of any such sale as follows: first, to the costs of such sale;
second, to the costs of storing any such property; third, to the payment of any
other sums of money which may then or thereafter be due to Landlord from Tenant
under any of the terms of this Lease; and fourth, the balance, if any, to
Tenant.

           (b) On the Term Expiration Date (or earlier termination of this
Lease), all equipment, fixtures and cables installed by Tenant pursuant to
Section 2.05(a) shall be removed by Tenant and all areas used for cables and
---------------
equipment and trade fixtures serving the foregoing location shall be repaired or
restored by Tenant in as good order and condition as they were in on the Term
Commencement Date, reasonable wear and tear excepted. Reasonable wear and tear
shall not include any damage or deterioration that would have been prevented by
good maintenance practice if required to be maintained by Tenant under this
Lease or by Tenant performing all of its obligations under this Lease. Tenant
shall repair any damage to the Leased Premises, the Building or the Project
resulting from such removal.

     5.16. Tenant's Remedies. Landlord shall not be deemed in breach of this
Lease unless Landlord fails within a reasonable time to perform an obligation
required to be performed by Landlord, except as otherwise specifically provided
for in the Lease. For purposes of this Section 5.16, a reasonable time shall in
                                       ------------
no event, be less than fifteen (15) business days after receipt by Landlord, and
by the holders of any ground lease, deed of trust or mortgage covering the
Leased Premises whose name and address shall have been furnished Tenant in
writing for such purpose, of written notice specifying wherein such obligation
of Landlord has not been performed; provided, however, that if the nature of
Landlord's obligation is such that more than fifteen (15) days after such notice
are reasonably required for its performance, then Landlord shall not be in
breach of this Lease if performance is commenced within said fifteen (15) -day
period and thereafter diligently pursued to completion. If Landlord fails to
cure such default within the time provided for in this Lease, the holder of any
such ground lease, deed of trust or mortgage shall have an additional

                                       24
<PAGE>

thirty (30) days to cure such default; provided that if such default cannot
reasonably be cured within that thirty (30) day period, then such holder shall
have such additional time to cure the default as is reasonably necessary under
the circumstances. Tenant shall look solely to Landlord's interest in the
Project for recovery of any judgment from Landlord. Neither Landlord nor any of
its trustees, directors, officers, agents, employees or representatives (or, if
Landlord is a partnership, its partners, whether general or limited) shall ever
be personally liable for any such judgment against the Landlord. Any lien
obtained to enforce any such judgment and any levy of execution thereon shall be
subject and subordinate to any lien, deed of trust or mortgage to which Section
                                                                        -------
5.12 applies or may apply. Tenant shall not have the right to terminate this
----
Lease or withhold, reduce or offset any amount against any payments of Rent due
and payable under this Lease by reason of a breach of this Lease by Landlord,
other than amounts set forth in any judgment or order in favor of Tenant.
Provided however, that if as a result of the foregoing, the Leased Premises or
any portion thereof subsequently shall become untenantable by Tenant for the
purposes set forth herein as determined by the final decision of the court or
arbitrator, all Rent payable for such affected space shall abate for the period
of such untenantability.

     5.17. Rules and Regulations. Tenant shall comply with the rules and
regulations for the Project attached as Exhibit D and such reasonable amendments
                                        ---------
thereto as Landlord may adopt from time to time with prior notice to Tenant
which shall not materially adversely affect Tenant's intended use of the Leased
Premises. To the extent that the rules and regulations are inconsistent with the
provisions or intent of this Lease, the terms of this Lease shall control.

                                  Article 6.
                             Environmental Matters

     6.01. Hazardous Materials Prohibited.

           (a) Tenant shall not cause or permit any Hazardous Material (as
defined in Section 6.01(c) below) to be brought, kept, used, generated, released
           ---------------
or disposed in, on, under or about the Leased Premises or the Project by Tenant,
its agents, employees, contractors or invitees; provided, however, that Tenant
may use, store and dispose of, in accordance with applicable Laws, limited
quantities of standard office and janitorial supplies, but only to the extent
reasonably necessary for Tenant's operations in the Leased Premises, except as
allowed by Landlord in writing. Tenant hereby indemnities Landlord from and
against (i) any breach by Tenant of the obligations stated in the preceding
sentence, (ii) any breach of the obligations stated in Section 6.01 (b) below,
                                                       ----------------
or (iii) any claims or liability resulting from Tenant's use of Hazardous
Materials. Tenant hereby agrees to defend and hold Landlord harmless from and
against any and all claims, liability, losses, damages, costs and/or expenses
(including, without limitation, diminution in value of the Project, or any
portion thereof, damages for the loss or restriction on use of rentable or
usable space or of any amenity of the Project, damages arising from any adverse
impact on marketing of space in the Project, and sums paid in settlement of
claims, fines, penalties, attorneys' fees, consultants' fees and experts' fees)
which arise during or after the Term as a result of any breach by Tenant of the
obligations stated in Sections 6.01 (a) or 6.01(b) or otherwise resulting from
                      -----------------    -------
Tenant's use of Hazardous Materials;, nothing contained in this section shall
require Tenant to indemnify Landlord for any such liability or condition that
was in existence on or before the date Tenant took possession of the Leased
Premises or otherwise disclosed in the Environmental Reports. This
indemnification of Landlord by Tenant includes, without limitation, death of or
injury to person, damage to any property or the environment and costs incurred
in connection with any investigation of site conditions or any cleanup,
remedial, removal, or restoration work required by any federal, state or local
governmental agency or political subdivision because of any Hazardous Material
present in, on, under or about the Leased Premises or the Project (including
soil

                                       25
<PAGE>

and ground water contamination) which results from and is attributable to such a
breach. Without limiting the foregoing, if the presence of any Hazardous
Material in, on, under or about the Leased Premises or the Project caused or
permitted by Tenant results in any contamination of the Leased Premises or the
Project, Tenant shall promptly take all actions at its sole expense as are
necessary to return the same to the condition existing prior to the introduction
of such Hazardous Material; provided that Landlord's approval of such actions,
and the contractors to be used by Tenant in connection therewith, shall first be
obtained. This indemnification of Landlord by Tenant shall survive the
expiration or sooner termination of this Lease.

          (b)  Tenant covenants and agrees that Tenant shall at all times be
responsible and liable for, and be in compliance with, all federal, state, local
and regional laws, ordinances, rules, codes and regulations, as amended from
time to time ("Governmental Requirements"), relating to health and safety and
environmental matters, arising, directly or indirectly, out of Tenant's use of
Hazardous Materials (as defined in Section 6.01 (c) below) in the Project.
                                   ----------------
Health and safety and environmental matters for which Tenant is responsible
under this paragraph include, without limitation (i) notification and reporting
to governmental agencies, (ii) the provision of warnings of potential exposure
to Hazardous Materials to Landlord and Tenant's agents, employees, licensees,
contractors and others, (iii) the payment of taxes and fees, (iv) the proper
off-site transportation and disposal of Hazardous Materials, and (v) all
requirements, including training, relating to the use of equipment. Immediately
upon discovery of a release of Hazardous Materials associated with Tenant's
activities, Tenant shall give written notice to Landlord, whether or not such
release is subject to reporting under Governmental Requirements. The notice
shall include information on the nature and conditions of the release and
Tenant's planned response. Tenant shall be liable for the cost of any clean-up
of the release of any Hazardous Materials by Tenant on the Project.

          (c)  As used in this Lease, the term "Hazardous Material" means any
hazardous or toxic substance, material or waste which is or becomes regulated by
any local governmental authority, the State of California or the United States
Government. The term "Hazardous Material" includes, without limitation, any
substance, material or waste which is (i) defined as a "hazardous waste" or
similar term under the laws of the jurisdiction where the Project is located;
(ii) designated as a "hazardous substance" pursuant to Section 311 of the
Federal Water Pollution Control Act (33 U.S.C. (S) 1317); (iii) defined as a
"hazardous waste" pursuant to Section 1004 of the Federal Resource, Conservation
and Recovery Act, 42 U.S.C. (S) 6901 et. seq. (42 U.S.C. (S) 6903); (iv) defined
                                     --  ---
as a "hazardous substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. (S) 9601 et.
                                                                           ---
seq. (42 U.S.C. (S) 9601); (v) hydrocarbons, petroleum, gasoline, crude oil or
---
any products, by-products or fractions thereof; or (vi) asbestos in any form or
condition.

          (d)  As used in this Article 6, the term "Laws" means any applicable
federal, state or local laws, ordinances, rules or regulations relating to any
Hazardous Material affecting the Project, including, without limitation, the
specific laws, ordinances and regulations referred to in Section 6.01(c) above.
                                                         ---------------
References to specific Laws shall also be references to any amendments thereto
and to any applicable successor Laws.

          (e)  Landlord represents and warrants that, to the best of Landlord's
actual knowledge, except as disclosed in the environmental reports (the
"Environmental Reports") provided to Tenant by Landlord (i) no portion of the
Leased Premises, Building or the Project, contain any Hazardous Materials; (ii)
the soil and ground water on or under the Project are free of Hazardous
Materials in amounts that would violate any Laws; (iii) there is no pending or
threatened litigation, nor any settlement applicable to the Project concerning
Hazardous Materials; and (iv) there has been no notice or alleged violations of
hazardous Materials in connection with the Project. Tenant acknowledges its
receipt and review of the Environmental Reports prior to entering into this
Lease. Landlord hereby agrees to indemnify Tenant from any breach by

                                       26
<PAGE>

Landlord of its representations and warranties in this Section 6.01(e) in the
                                                       ---------------
same manner as required of Tenant pursuant to Section 6.01(a) and for any
                                              ---------------
liability or condition from the use or existence of any Hazardous Materials on
or within the Project as of the date of this Lease.

     6.02. Limitations on Assignment and Subletting. It shall not be
unreasonable for Landlord to withhold its consent to any proposed assignment or
subletting of the Leased Premises if (i) the proposed transferee's anticipated
use of the Leased Premises involves the generation, storage, use, treatment, or
disposal of Hazardous Material (excluding standard office and janitorial
supplies; in limited quantities as hereinabove provided); (ii) the proposed
transferee has been required by any prior landlord, lender or governmental
authority to take remedial action in connection with Hazardous Material
contaminating a property if the contamination resulted from such transferee's
actions or use of the property in question and the Leased Premises are intended
to be used in a similar manner; or (iii) the proposed transferee is subject to
an enforcement order issued by any governmental authority in connection with the
generation, storage, use, treatment or disposal of a Hazardous Material.

     6.03. Right of Entry. Landlord, its employees, agents and consultants,
shall have the right to enter the Leased Premises at any time, in case of an
emergency, and otherwise during reasonable hours and upon reasonable notice to
Tenant, in order to conduct periodic environmental inspections and tests to
determine whether any Hazardous Materials are present. The costs and expenses of
such inspections shall be paid by Landlord unless a default or breach of this
Lease, violation of Laws or contamination caused or permitted by Tenant is found
to exist. In such event, Tenant shall reimburse Landlord upon demand, as
Additional Rent, for the costs and expenses of such inspections. Notwithstanding
the foregoing, except in cases of an emergency, Landlord, its employees, agents
and consultants shall not enter the Leased Premises unless accompanied by a
representative of Tenant and Landlord shall cooperate with any reasonable
security procedures of Tenant and shall not unreasonably interfere with Tenant's
operations and use of the Leased Premises.

     6.04. Notice to Landlord. Tenant shall immediately notify Landlord in
writing of: (i) any enforcement, clean-up, removal or other governmental or
regulatory action instituted or threatened regarding the Leased Premises or the
Project pursuant to any Laws; (ii) any claim made or threatened by any person
against Tenant or the Leased Premises relating to damage, contribution, cost
recovery, compensation, loss or injury resulting from or claimed to result from
any Hazardous Material; and (iii) any reports made to or received from any
governmental agency arising out of or in connection with any Hazardous Material
in or removed from the Leased Premises or the Project, including any complaints,
notices, warnings or asserted violations in connection therewith. Tenant shall
also supply to Landlord as promptly as possible, and in any event within ten
(10) business days after Tenant first receives or sends the same, copies of all
claims, reports, complaints, notices, warnings, asserted violations or other
communications relating in any way to the Leased Premises or Tenant's use
thereof.

     6.05. Notice to Tenant. Landlord shall immediately notify Tenant in writing
of: (i) any enforcement, clean-up, removal or other governmental or regulatory
action instituted or threatened regarding the Leased Premises or the Project
pursuant to any Laws; (ii) any claim made or threatened by any person against
Landlord or the Leased Premises relating to damage, contribution, cost recovery,
compensation, loss or injury resulting from or claimed to result from any
Hazardous Material; and (iii) any reports made to or received from any
governmental agency arising out of or in connection with any Hazardous Material
in or removed from the Leased Premises or the Project, including any complaints,
notices, warnings or asserted violations in connection therewith. Landlord shall
also supply to Tenant as promptly as possible, and in any event within ten (10)
business days after Landlord first receives or sends the same, copies of all
claims,

                                       27
<PAGE>

reports, complaints, notices, warnings, asserted violations or other
communications relating in any way to the Leased Premises.

                                  Article 7.
            Insurance, Indemnity, Condemnation, Damage and Default

     7.01. Landlord's Insurance. Landlord shall secure and maintain policies of
insurance for the Project (including the Leased Premises) covering loss of or
damage to the Project, including Landlord's Contribution, as specified in
Exhibit B hereto, but excluding the Tenant Improvements provided by Tenant at
---------
Tenant's expense and excluding all subsequent alterations, additions and
improvements to the Leased Premises, with loss payable to Landlord and to the
holders of any deeds of trust, mortgages or ground leases on the Project.
Landlord shall not be obligated to obtain insurance for Tenant's trade fixtures,
equipment, furnishings, machinery or other property. Such policies shall
provide protection against fire and extended coverage perils and such additional
perils as Landlord deems suitable, and with such commercially reasonable
deductible(s) as Landlord shall deem reasonably appropriate. Landlord shall
further secure and maintain commercial general liability insurance with respect
to the Project in such amount as Landlord shall determine, such insurance to be
in addition to, and not in lieu of, the liability insurance required to be
maintained by Tenant. In addition, Landlord may secure and maintain rental
income insurance. If the annual cost to Landlord for any such insurance exceeds
the standard rates because of the nature of Tenant's operations, Tenant shall,
upon receipt of appropriate invoices, reimburse Landlord for such increases in
cost, which amounts shall be deemed Additional Rent hereunder provided that
Landlord notifies Tenant prior to the execution of this Lease of any material
cost increases. Tenant shall not be named as an additional insured on any policy
of insurance maintained by Landlord. Landlord shall use best efforts to provide
Tenant with a certificate of insurance evidencing all such insurance coverage,
with an endorsement that the insurer agrees not to cancel, non-renew or
materially alter the policy without at least thirty (30) days prior written
notice to Tenant.

     7.02. Tenant's Liability Insurance.

           (a) Tenant (with respect to both the Leased Premises and the Project)
shall secure and maintain, at its own expense, at all times during the Term, a
policy or policies of commercial general liability insurance with the premiums
thereon fully paid in advance, protecting Tenant and naming Landlord, the
holders of any deeds of trust, mortgages or ground leases on the Project, of
whom Tenant has received written notice as additional insureds against claims
for bodily injury, personal injury, advertising injury and property damage
(including attorneys' fees) based upon, involving or arising out of Tenant's
operations, assumed liabilities or Tenant's use, occupancy or maintenance of the
Leased Premises and the Common Areas of the Project. Such insurance shall
provide for a minimum amount of Two Million Dollars ($2,000,000.00) for property
damage or injury to or death of one or more than one person in any one accident
or occurrence, with an annual aggregate limit of at least Four Million Dollars
($4,000,000.00), inclusive of any umbrella coverage. The coverage required to be
carried shall include fire legal liability, blanket contractual liability,
personal injury liability (libel, slander, false arrest and wrongful eviction),
broad form property damage liability, products liability and completed
operations coverage (as well as owned, non-owned and hired automobile liability
if an exposure exists) and the policy shall contain an exception to any
pollution exclusion which insures damage or injury arising out of heat, smoke or
fumes from a hostile fire. Such insurance shall be written on an occurrence
basis and contain a separation of insureds provision or cross-liability
endorsement reasonably acceptable to Landlord. Tenant shall provide Landlord
with a certificate evidencing such insurance coverage. The certificate shall
indicate that the insurance provided specifically recognizes the liability
assumed by Tenant under this Lease (including without limitation

                                       28
<PAGE>

performance by Tenant under Section 7.04) and that Tenant's insurance is primary
                            ------------
to and not contributory with any other insurance maintained by Landlord, whose
insurance shall be considered excess insurance only. Not more frequently than
every two (2) years, if, in the opinion of any mortgagee of Landlord or of the
insurance broker retained by Landlord, the amount of liability insurance
coverage at that time is not adequate, then Tenant shall increase its liability
insurance coverage as reasonably required by either any mortgagee of Landlord or
Landlord's insurance broker, but in no event more than a twenty percent (20%)
increase.

           (b) Tenant shall, at Tenant's expense, comply with (i) all insurance
company requirements pertaining to the use of the Leased Premises and (ii) all
rules, orders, regulations or requirements of the American Insurance Association
(formerly the National Board of Fire Underwriters) and with any similar body.

     7.03. Tenant's Additional Insurance Requirements.

           (a) Tenant shall secure and maintain, at Tenant's expense, at all
times during the Term, a policy of physical damage insurance on all of Tenant's
fixtures, furnishings, equipment, machinery, merchandise and personal property
in the Leased Premises and alterations, additions or improvements made by or for
Tenant upon the Leased Premises, all for eighty percent (80%) of the full
replacement cost thereof without deduction for depreciation of the covered items
and in amounts that meet any co-insurance clauses of the policies of insurance.
Such insurance shall insure against those risks customarily covered in an "all
risk" policy of insurance covering physical loss or damage. Tenant shall use the
proceeds from such insurance for the replacement of fixtures, furnishings,
equipment and personal property and for the restoration of alterations,
additions or improvements to the Leased Premises. In addition, Tenant shall
secure and maintain, at all times during the Term, loss of income, business
interruption and extra expense insurance in such amounts as will reimburse
Tenant for direct or indirect loss of earnings and incurred costs attributable
to all perils commonly insured against by prudent tenants or attributable to
prevention of access to the Leased Premises or to the Building as a result of
such perils; such insurance shall be maintained with Tenant's property insurance
carrier. Further, Tenant shall secure and maintain at all times during the Term
workers' compensation insurance in such amounts as are required by law,
employer's liability insurance in the amount of One Million Dollars
($1,000,000.00) per occurrence, and all such other insurance as may be required
by applicable law or as may be reasonably required by Landlord. The property
insurance certificate shall confirm that the waiver of subrogation required to
be obtained pursuant to Section 7.05 is permitted by the insurer. Tenant shall,
                        ------------
at least thirty (30) days prior to the expiration of any policy of insurance
required to be maintained by Tenant under this Lease, furnish Landlord with an
"insurance binder" or other satisfactory evidence of renewal thereof.

           (b) All policies required to be carried by Tenant under this Lease
shall be issued by and binding upon a reputable insurance company of good
financial standing licensed to do business in the State of California with a
rating of at least A-VII, or such other rating as may be required by a lender
having a lien on the Project, as set forth in the most current issue of "Best's
Insurance Reports." Tenant shall not do or permit anything to be done that would
invalidate the insurance policies referred to in this Article 7. Evidence of
insurance provided to Landlord shall include an endorsement showing that
Landlord, its representatives and the holders of any deeds of trust, mortgages
or ground leases on the Project are included as additional insureds on general
liability insurance, and as loss payees for property insurance, to the extent
required hereunder, and an endorsement whereby the insurer agrees not to cancel,
non-renew or materially alter the policy without at least thirty (30) days prior
written notice to Landlord, its representatives and any mortgagee of Landlord.

                                       29
<PAGE>

           (c) In the event that Tenant fails to provide evidence of insurance
required to be provided by Tenant under this Lease, prior to commencement of the
Term, and thereafter during the Term, within ten (10) days following Landlord's
request therefor, and thirty (30) days prior to the expiration date of any such
coverage, Landlord shall be authorized (but not required) to procure such
coverage in the amounts stated with all costs thereof (plus a five percent (5%)
administrative fee) to be chargeable to Tenant and payable upon written invoice
therefor, which amounts shall be deemed Additional Rent hereunder.

           (d) The minimum limits of insurance required by this Lease, or as
carried by Tenant, shall not limit the liability of Tenant nor relieve Tenant of
any obligation hereunder.

     7.04. Indemnity and Exoneration.

           (a) To the extent not prohibited by law, Landlord and Landlord's
representatives shall not be liable for any loss, injury or damage to person or
property of Tenant, Tenant's agents, employees, contractors, invitees or any
other person, whether caused by theft, fire, act of God, acts of the public
enemy, riot, strike, insurrection, war, court order, requisition or order of
governmental body or authority or which may arise through repair, alteration or
maintenance of any part of the Project or failure to make any such repair or
from any other cause whatsoever, except as expressly otherwise provided in
Sections 7.06 and 7.07. Landlord shall not be liable for any loss, injury or
-------------     ----
damage arising from any act or omission of any other tenant or occupant of the
Project. Landlord shall indemnify, protect, defend and hold Tenant and Tenant's
representatives, harmless from any and all claims, liability, costs, penalties,
fines, damages, injury, judgments, forfeiture, losses or expenses (including
without limitation attorneys' fees, consultant fees, testing and investigation
fees, expert fees and court costs) arising out of or in any way related to or
resulting directly or indirectly from (i) the negligent activities of Landlord,
its agents, employees, contractors or invitees in or about the Leased Premises
or the Project (where not covered by Landlord's insurance), (ii) any failure to
comply with any applicable law, and (iii) any default or breach by Landlord in
the performance of any obligation of Landlord under this Lease; provided,
however, that the foregoing indemnity shall not be applicable to claims arising
by reason of the gross negligence or willful misconduct of Tenant. The foregoing
notwithstanding, the Landlord shall not be liable for consequential damages,
loss of profit or income therefrom.

           (b) Tenant shall indemnify, protect, defend and hold the Project,
Landlord and its representatives, harmless of and from any and all claims,
liability, costs, penalties, fines, damages, injury, judgments, forfeiture,
losses (including without limitation diminution in the value of the Leased
Premises) or expenses (including without limitation attorneys' fees, consultant
fees, testing and investigation fees, expert fees and court costs) arising out
of or in any way related to or resulting directly or indirectly from (i)
Tenant's use or occupancy of the Leased Premises, (ii) the negligent activities
of Tenant, its agents, employees, contractors or invitees in or about the Leased
Premises or the Project (where not covered by Landlord's insurance), (iii) any
failure to comply with any applicable law, and (iv) any default or breach by
Tenant in the performance of any obligation of Tenant under this Lease;
provided, however, that the foregoing indemnity shall not be applicable to
claims arising by reason of the gross negligence or willful misconduct of
Landlord.

           (c) Tenant shall indemnify, protect, defend and hold the Project,
Landlord and its representatives, harmless of and from any and all claims,
liability, costs, penalties, fines, damages, injury, judgments, forfeiture,
losses (including without limitation diminution in the value of the Leased
Premises) or expenses (including without limitation attorneys' fees, consultant
fees, testing and investigation fees, expert fees and court costs) arising out
of or in any way related to or resulting directly or indirectly from work or
labor performed, materials or supplies furnished to or at the request of Tenant
or in connection with

                                       30
<PAGE>

obligations incurred by or performance of any work done for the account of
Tenant in the Leased Premises or the Project.

           (d) The provisions of this Section 7.04 shall survive the expiration
                                      ------------
or sooner termination of this Lease. BY SIGNING ITS INITIALS BELOW, TENANT
ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THE MEANING AND RAMIFICATIONS OF
THE PROVISIONS SET FORTH IN THIS SECTION 7.04 AND FURTHER ACKNOWLEDGES THAT SUCH
                                 ------------
PROVISIONS WERE SPECIFICALLY NEGOTIATED.

/s/ [ILLEGIBLE]^^
------------------------
Tenant's Initials


     7.05. Waiver of Subrogation. Anything in this Lease to the contrary
notwithstanding, Landlord and Tenant each waives all rights of recovery, claim,
action or cause of action against the other, its agents (including partners,
both general and limited), trustees, officers, directors, and employees, for any
loss or damage that may occur to the Leased Premises, or any improvements
thereto, or the Project or any personal property of such party therein, by
reason of any cause required to be insured against under this Lease to the
extent of the coverage required, regardless of cause or origin, including
negligence of the other party hereto, provided that such party's insurance is
not invalidated thereby; and each party covenants that, to the fullest extent
permitted by law, no insurer shall hold any right of subrogation against such
other party. Tenant shall advise its insurers of the foregoing and such waiver
shall be a part of each policy maintained by Tenant which applies to the Leased
Premises, any part of the Project or Tenant's use and occupancy of any part
thereof.

     7.06. Condemnation.

           (a) If the Leased Premises are taken under the power of eminent
domain or sold under the threat of the exercise of such power (all of which are
referred to herein as "condemnation"), this Lease shall terminate as to the part
so taken as of the date the condemning authority takes title or possession,
whichever first occurs (the "date of taking"). If the Leased Premises or any
portion of the Project is taken by condemnation to such an extent as to render
the Leased Premises untenantable as reasonably determined by Landlord or Tenant,
this Lease shall, at the option of either party to be exercised in writing
within thirty (30) days after receipt of written notice of such taking,
forthwith cease and terminate as of the date of taking. All proceeds from any
condemnation of the Leased Premises shall belong and be paid to Landlord,
subject to the rights of any mortgagee of Landlord's interest in the Project or
the beneficiary of any deed of trust which constitutes an encumbrance thereon;
provided that Tenant shall be entitled to any compensation separately awarded to
Tenant for Tenant's relocation expenses or, loss of Tenant's trade fixtures, or
for the loss of the value of Tenant's leasehold estate, or for the lost of
Tenant's alterations and additions made by Tenant at Tenant's expense, both
prior to and subsequent to the Commencement Date. If this Lease continues in
effect after the date of taking pursuant to the provisions of this Section
                                                                   -------
7.06(a), Landlord shall proceed with reasonable diligence to repair, at its
-------
expense, the remaining parts of the Project and the Leased Premises to
substantially their former condition to the extent that the same is feasible
(subject to reasonable changes which Landlord shall deem desirable) and so as to
constitute a complete and tenantable Project and Leased Premises. Net Rent shall
abate to the extent appropriate during the period of restoration, and Net Rent
shall thereafter be equitably adjusted according to the remaining Rentable Area
of the Leased Premises and the Building.

                                       31
<PAGE>

     7.07. Damage or Destruction. In the event of a fire or other casualty in
the Leased Premises, Tenant shall immediately give notice thereof to Landlord.
The following provisions shall then apply:

           (a) If the damage is limited solely to the Leased Premises and the
Leased Premises can, in the reasonable good faith opinion of both Landlord and
Tenant to be made within 10 days of such casualty, be made tenantable with all
damage repaired within four and one half (4 1/2) months from the date of damage,
then Landlord shall be obligated to rebuild the same to substantially their
former condition to the extent that the same is feasible (subject to reasonable
changes which Landlord shall deem desirable and such changes as may be required
by applicable law) and shall proceed with reasonable diligence to do so and this
Lease shall remain in full force and effect; however, if forty percent (40%) or
more of the Leased Premises is damaged or destroyed rendering the Leased
Premises untenantable in the reasonable good faith opinion of Tenant, then this
Lease shall, at the election of Tenant, terminate as of the date of such
casualty if such casualty in the reasonable good faith opinion of both Landlord
and Tenant to be made within ten (10) days of such casualty, cannot be made
tenantable with all damage repaired within four and one-half (4 1/2) months from
the date of damage. Tenant shall notify Landlord of its intent to terminate this
Lease within five (5) days after the expiration of the ten (10) day period
described above.

           (b) If portions of the Project outside the boundaries of the Leased
Premises are damaged or destroyed (whether or not the Leased Premises are also
damaged or destroyed) and the Leased Premises and the Project can, in Landlord's
opinion, both be made tenantable with all damage repaired within six (6) months
from the date of damage or destruction, and provided that Landlord determines
that it is economically feasible, then Landlord shall be obligated to rebuild
the same to substantially their former condition to the extent that the same is
feasible (subject to reasonable changes which Landlord shall deem desirable and
such changes as may be required by applicable law) and shall proceed with
reasonable diligence to do so within such six (6) month period and this Lease
shall remain in full force and effect

           (c) Notwithstanding anything to the contrary contained in Sections
                                                                     --------
7.07(a) or 7.07(b) above, Landlord shall not have any obligation whatsoever to
-------    -------
repair, reconstruct or restore the Leased Premises when any damage thereto or to
the Project occurs during the last eighteen (18) months of the Term and Tenant
has not effectively exercised any option granted to Tenant to extend the Term.
Under such circumstances, Landlord shall promptly notify Tenant of its decision
not to rebuild within thirty (30) days of the date of such casualty, whereupon
the Lease shall terminate as of the date of such notice.

           (d) If neither Section 7.07(a) nor 7.07(b) above applies, Landlord
                          ---------------     -------
shall so notify Tenant within thirty (30) days after the date of the damage or
destruction and either Tenant or Landlord may terminate this Lease within thirty
(30) days after the date of such notice, such termination notice to be
immediately effective; provided, however, that Landlord shall have the right to
elect to reconstruct the Project and the Leased Premises, in which event (i)
Landlord shall notify Tenant of such election within said thirty (30) day period
and Tenant shall thereupon have no right to terminate this Lease, and (ii)
Landlord shall proceed with reasonable diligence to rebuild the Project and the
Leased Premises to substantially their former condition to the extent that the
same is feasible (subject to reasonable changes which Landlord shall deem
desirable and such changes as may be required by applicable law.

           (e) During any period when Tenant's use of the Leased Premises is
significantly impaired by damage or destruction, Net Rent shall abate in
proportion to the degree to which Tenant's use of the Leased Premises is
impaired until such time as the Leased Premises are made tenantable, or usable
for Tenant's intended business use if later, as reasonably determined by
Landlord; provided that no such rental abatement shall be permitted if the
casualty is the result of the negligence or willful misconduct of

                                       32
<PAGE>

Tenant or Tenant's employees, agents, contractors or invitees; provided however,
to the extent that Landlord receives any loss of rental insurance proceeds Net
Rent shall abate.

           (f) The proceeds from any insurance paid under Landlord's Insurance
by reason of damage to or destruction of the Project or any part thereof insured
by Landlord shall belong to and be paid to Landlord, subject to the rights of
any mortgagee of Landlord's interest in the Project or the beneficiary of any
deed of trust which constitutes an encumbrance thereon. Tenant shall be
responsible at its sole cost and expense for the repair, restoration and
replacement of (i) its fixtures, furnishings, equipment, machinery, merchandise
and personal property in the Leased Premises, and (ii) its alteration, additions
and improvements.

           (g) Landlord's repair and restoration obligations under this Section
                                                                        -------
7.07 shall not impair or otherwise affect the rights and obligations of the
----
parties set forth elsewhere in this Lease. Subject to Section 7.07(e), Landlord
                                                      ---------------
shall not be liable for any inconvenience or annoyance to Tenant, its employees,
agents, contractors or invitees, or injury to Tenant's business resulting in any
way from such damage or the repair thereof. Landlord and Tenant agree that the
terms of this Lease shall govern the effect of any damage to or destruction of
the Leased Premises or the Project with respect to the termination of this Lease
and hereby waive the provisions of any present statute or law to the extent
inconsistent therewith.

     7.08. Default by Tenant.

           (a) Events of Default. The occurrence of any of the following shall
constitute an event of default (a "default") on the part of Tenant:

               (1)  Abandonment. Vacating the Leased Premises without the
intention to reoccupy same, or abandonment of the Leased Premises and such
vacation or abandonment continues for a continuous period of six (6) months
provided Tenant is actively pursuing releting of the Leased Premises during such
period;

               (2)  Nonpayment of Rent. Failure to pay any installment of Rent
due and payable hereunder within five (5) days of the date when payment is due,
such failure continuing for a period of three (3) business days after written
notice of such failure; provided, however, that Landlord shall not be required
to provide such notice more than ten (10) times during the Term and no more than
two (2) times in any 12 month period with respect to non-payment of Net Rent or
Additional Rent, the third such non-payment constituting default without
requirement of notice; furthermore, if Tenant shall be served with a demand for
the payment of past due Rent, any payment(s) tendered thereafter to cure any
default by Tenant shall be made only by cashier's check, wire-transfer or direct
deposit of immediately available funds;

               (3)  Other Obligations. Failure to perform any obligation,
agreement or covenant under this Lease other than those matters specified in
Sections 7.08(a)(1) and 7.0 8(a)(2), such failure continuing for a period of
-------------------     -----------
thirty (30) days after written notice of such failure (or such longer period as
is reasonably necessary to remedy such default, provided that Tenant commences
the remedy within such thirty (30)-day period and continuously and diligently
pursues such remedy at all times until such default is cured);

               (4)  General Assignment. Any general arrangement or 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 against Tenant,
which involuntary petition remains undischarged or

                                       33
<PAGE>

is not stayed for a period of ninety (90) days or such longer period if Tenant
is diligently pursuing such dismissal. In the event that 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, within 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 appointment of a trustee or receiver to
take possession of all or substantially all of Tenant's assets or the Leased
Premises, where possession is not restored to Tenant within ten (10) business
days or actively contested by Tenant within such 10 day period;

               (7)  Attachment. The attachment, execution or other judicial
seizure of all or substantially all of Tenant's assets or the Leased Premises,
if such attachment or other seizure remains undismissed or undischarged for a
period of ten (10) business days after the levy thereof;

               (8)  Insolvency. The admission by Tenant in writing of its
inability to pay its debts as they become due; the filing by Tenant of a
petition seeking any reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future statute,
law or regulation; the filing by Tenant of an answer admitting or failing timely
to contest a material allegation of a petition filed against Tenant in any such
proceeding; or, if within sixty (60) days after the commencement of any
proceeding against Tenant seeking any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any present or
future statute, law or regulation, such proceeding shall not have been
dismissed;

               (9)  [Intentionally deleted.]

               (10) [Intentionally deleted.]

               (11) Misrepresentation. The discovery by Landlord that any
material representation, warranty or financial statement given to Landlord by
Tenant was materially false or misleading.

          (b)  Remedies Upon Default:

               (1)  Termination. If an event of default occurs, Landlord shall
have the right, with or without notice or demand, except as otherwise provided
in this Lease, immediately (after expiration of any applicable grace period
specified herein) to terminate this Lease, and at any time thereafter recover
possession of the Leased Premises or any part thereof and expel and remove
therefrom Tenant and any other person occupying the same, by any lawful means,
and again repossess and enjoy the Leased Premises without prejudice to any of
the remedies that Landlord may have under this Lease, or at law or in equity by
reason of Tenant's default or of such termination.

               (2)  Continuation After Default. Even though Tenant has breached
this Lease and/or abandoned the Leased Premises, this Lease shall continue in
effect for so long as Landlord does not terminate Tenant's right to possession
under Section 7.08(b)(1) hereof in writing, and Landlord may enforce all of its
      ------------------
rights and remedies under this Lease, including (but without limitation) the
right to recover Rent as it becomes due, and Landlord, without terminating this
Lease, may exercise all of the rights and remedies of a landlord under Section
1951.4 of the Civil Code of the State of California or any amended or successor

                                       34
<PAGE>

code section. Acts of maintenance or preservation, efforts to relet the Leased
Premises or the appointment of a receiver upon application of Landlord to
protect Landlord's interest under this Lease shall not constitute an election to
terminate Tenant's right to possession. If Landlord elects to relet the Leased
Premises for the account of Tenant, the rent received by Landlord from such
reletting shall be applied as follows: first, to the payment of any indebtedness
other than Rent due hereunder from Tenant to Landlord; second, to the payment of
any costs of such reletting; third, to the payment of the cost of any
alterations or repairs to the Leased Premises; fourth, to the payment of Rent
due and unpaid hereunder and the balance, if any, shall be held by Landlord and
applied in payment of future Rent as it becomes due. If that portion of rent
received from the resetting which is applied against the Rent due hereunder is
less than the amount of the Rent due, Tenant shall pay the deficiency to
Landlord promptly upon demand by Landlord. Such deficiency shall be calculated
and paid monthly. Tenant shall also pay to Landlord, as soon as determined, any
costs and expenses incurred by Landlord in connection with such reletting or in
making alterations and repairs to the Leased Premises, which are not covered by
the rent received from the reletting.

          (c)  Damages Upon Termination. Should Landlord terminate this Lease
pursuant to the provisions of Section 7.08(b)(1) hereof, Landlord shall have all
                              ------------------
the rights and remedies of a landlord provided by Section 1951.2 of the Civil
Code of the State of California. Upon such termination, in addition to any other
rights and remedies to which Landlord may be entitled under applicable law,
Landlord shall be entitled to recover from Tenant: (i) the worth at the time of
award of the unpaid Rent and other amounts which had been earned at the time of
termination; (ii) the worth at the time of award of the amount by which the
unpaid Rent which would have been earned after termination until the time of
award exceeds the amount of such Rent loss that Tenant proves could have been
reasonably avoided; (iii) the worth at the time of award of the amount by which
the unpaid Rent for the balance of the Term after the time of award exceeds the
amount of such Rent loss that Tenant proves could be reasonably avoided; and
(iv) any other amount necessary to compensate Landlord for all the detriment
proximately caused by Tenant's failure to perform its obligations under this
Lease or which, in the ordinary course of things, would be likely to result
therefrom. The "worth at the time of award" of the amounts referred to in
clauses (i) and (ii) shall be computed with interest at the lesser of Prime (as
defined in the following sentence), plus five percent (5%) per annum or the
maximum rate then allowed by law (the "Default Rate"). The term Prime Rate shall
be that rate designated as such by Bank America as its Prime Rate to its most
credit worthy customers. The "worth at the time of award" of the amount referred
to in clause (iii) shall be computed by discounting such amount at the discount
rate of the Federal Reserve Bank of San Francisco at the time of the award plus
one percent (1%). The foregoing notwithstanding, Landlord shall use commercially
reasonable efforts to relet the Leased Premises at fair market rents.

          (d)  Computation of Rent for Purposes of Default. For purposes of
computing unpaid Rent which would have accrued and become payable under this
Lease pursuant to the provisions of Section 7.08(c), unpaid Rent shall consist
of the sum of:

               (1)  the total Base Rent for the balance of the Term, plus

               (2)  a computation of Tenant's Proportionate Share of Basic
Operating Cost for the balance of the Term, the assumed amount for the
Computation Year of the default and each future Computation Year in the Term to
be equal to Tenant's Proportionate Share of Basic Operating Cost for the
Computation Year immediately prior to the year in which default occurs,
compounded at a per annum rate equal to the mean average rate of inflation for
the preceding five (5) calendar years as determined by the United States
Department of Labor, Bureau of Labor Statistics Consumer Price Index (All Urban
Consumers, All items (1982-84=100)) for the Metropolitan Area or Region in which
the Project is located. If such Index

                                       35
<PAGE>

is discontinued or revised, the average rate of inflation shall be determined by
reference to the index designated as the successor or substitute index by the
government of the United States.

           (e)  Late Charge. If any payment required to be made by Tenant under
this Lease is not received by Landlord on or within five (5) days of the date
the same is due, Tenant shall pay to Landlord an amount equal to four percent
(4%) of the delinquency. The parties agree that Landlord would incur costs not
contemplated by this Lease by virtue of such delinquencies, including without
limitation administrative, collection, processing and accounting expenses, the
amount of which would be extremely difficult to compute, and the amount stated
herein represents a reasonable estimate thereof. Acceptance of such late charge
by Landlord shall in no event constitute a waiver of Tenant's breach or default
with respect to such delinquency, or prevent Landlord from exercising any of
Landlord's other rights and remedies.

           (f)  Interest on Past-Due Obligations. Except as expressly otherwise
provided in this Lease, any Rent due Landlord hereunder, other than late
charges, which is not received by Landlord on the date on which it was due,
shall bear interest from the day after it was due at the Default Rate, in
addition to the late charge provided for in Section 7.08(e).
                                            ---------------

           (g)  Landlord's Right to Perform. Notwithstanding anything to the
contrary set forth elsewhere in this Lease, in the event Tenant fails to perform
any affirmative duty or obligation of Tenant under this Lease, then within five
(5) business days after written notice to Tenant (and without notice in case of
an emergency) Landlord may (but shall not be obligated to) perform such duty or
obligation on Tenant's behalf, including, without limitation, the obtaining of
insurance policies or governmental licenses, permits or approvals. Tenant shall
reimburse Landlord upon demand for the costs and expenses of any such
performance (including penalties, interest and attorneys' fees incurred in
connection therewith). Such costs and expenses incurred by Landlord shall be
deemed Additional Rent hereunder.

           (h)  Remedies Cumulative. All rights, privileges and elections or
remedies of Landlord are cumulative and not alternative with all other rights
and remedies at law or in equity to the fullest extent permitted by law.

           (i)  Waiver. Tenant waives any right of redemption or relief from
forfeiture under California Code of Civil Procedure Sections 1174 and 1179, or
under any other present or future law in the event Tenant is evicted and
Landlord takes possession of the Leased Premises by reason of a default.

                                  Article 8.
                               Options to Renew

     8.01. Option to Renew.

           (a)  Landlord hereby grants to Tenant two (2) options (respectively,
the "First Option" and "Second Option", individually an "Option")) to extend the
Term of this Lease, each for an additional period of five (5) years (the "Option
Term"), all on the following terms and conditions:

                (1)  The Option must be exercised, if at all, by written notice
irrevocably exercising the Option ("Option Notice") delivered by Tenant to
Landlord not later than twelve (12) months prior to the Term Expiration Date
with respect to the First Option and not later than twelve (12) months prior to
the expiration date of the First Option Term ("First Option Expiration Date")
with respect to the Second Option. Further, the First Option or the Second
Option, as the case may be, shall not be deemed to be

                                       36
<PAGE>

properly exercised if, as of the date of the Option Notice or at the expiration
date of the Term or at the First Option Expiration Date, as the case may be, (i)
Tenant is in default under this Lease, (ii) Tenant has assigned this Lease or
its interest therein (other than to an affiliate or subsidiary of Tenant or as
otherwise provided in this Lease), or (iii) Tenant, or Tenant's affiliate or
subsidiary, is in possession of less than forty percent (40%) of the square
footage of the Premises. Provided Tenant has properly and timely exercised the
First Option (or the Second Option), the term of this Lease shall be extended
for the period of the First Option Term (or the Second Option Term), and all
terms, covenants and conditions of this Lease shall remain unmodified and in
full force and effect, except that the Leased Premises may be modified as
provided below and Base Rent shall be modified as set forth in Section
                                                               -------
8.01(a)(2) below. Tenant may exercise the Option for all, or a portion of the
----------
Leased Premises; however, if Tenant elects to exercise the Option for less than
the entirety of the Leased Premises, Tenant must either (i) exercise the Option
to lease the entire two-story Gibraltar Center II building or (ii) exercise the
Option to lease the entire one-story Gibraltar Center I building.

               (2)  The Base Rent payable for the First Option Term and the
Second Option Term shall be the then-current rental rate per rentable square
foot (as further defined below, "FMRR") being agreed to in new leases and
renewal leases by the Landlord and other landlords of buildings in the
Pleasanton, California area which are comparable in quality, location and
prestige to the Building ("Comparable Buildings") and tenants leasing space in
the Building or Comparable Buildings. Annual increases in Base Rent for the
First Option Term and the Second Option Term shall be the percentage that is
being agreed to at the time by Landlord and other landlords of Comparable
Buildings and tenants leasing space in the Building or Comparable Buildings. As
used herein, "FMRR" shall mean the rental rate per rentable square foot for
which Landlord and other landlords are entering into new leases and renewal
leases within the time period of fifteen (15) to twelve (12) months prior to the
Term Expiration Date or the First Option Expiration Date, as the case may be
("Market Determination Period"), with new tenants leasing from Landlord and/or
other landlords office space in the Building and/or Comparable Buildings taking
into account free rent; brokerage fees; tenant improvements; the location,
quality and age of the building; the use, location, size and/or floor levels of
the space in question; term or length of the lease; relocation/moving
allowances; space planning allowances; refurbishment and painting allowances;
extent of building operating expense services provided or to be provided; and
other concessions being made to tenants ("Comparative Transactions"). To the
extent such other Comparable Buildings have historically received lower or
higher rents from the rents in the Building, then for the purpose of arriving at
the FMRR, such rates when used to establish the FMRR in the Building shall be
increased or decreased as appropriate to reflect such historical differences.
Landlord shall provide its determination of the FMRR to Tenant within twenty
(20) days after Landlord receives the Option Notice. Tenant shall have fifteen
(15) days ("Tenant's Review Period") after receipt of Landlord's notice of the
FMRR within which to accept such FMRR or to reasonably object thereto in
writing. In the event Tenant objects to the FMRR submitted by Landlord, Landlord
and Tenant shall attempt to agree upon such FMRR. If Landlord and Tenant fail to
reach agreement on such FMRR within fifteen (15) days following Tenant's Review
Period (the "Outside Agreement Date"), then each party shall place in a separate
sealed envelope its final proposal as to FMRR and such determination shall be
submitted to arbitration in accordance with subparagraph 8.01(b) below.

          (b)  Landlord and Tenant shall meet with each other with in five (5)
business days of the Outside Agreement Date and exchange the sealed envelopes
and then open such envelopes in each other's presence. If Landlord and Tenant do
not mutually agree upon the FMRR within one (1) business day of the exchange and
opening of envelopes, then, within ten (10) business days of the exchange and
opening of envelopes, Landlord and Tenant shall agree upon and jointly appoint
one arbitrator who shall be by profession be a real estate appraiser or broker
who shall have been active over the five (5) year period ending on the date of
such appointment in the leasing of comparable commercial properties in the
vicinity of the

                                       37
<PAGE>

Building. Neither Landlord nor Tenant shall consult with such broker or
appraiser as to his or her opinion as to FMRR prior to the appointment. The
determination of the arbitrator shall be limited solely to the issue of whether
Landlord's or Tenant's submitted FMRR for the Premises is the closer to the
actual rental rate per rentable square foot for new leases within the Market
Determination Period for Comparative Transactions. Such arbitrator may hold such
hearings and require such briefs as the arbitrator, in his or her sole
discretion, determines is necessary. In addition, Landlord or Tenant may submit
to the arbitrator with a copy to the other party within five (5) business days
after the appointment of the arbitrator any data and additional information that
such party deems relevant to the determination by the arbitrator ("Data") and
the other party may submit a reply in writing within five (5) business days
after receipt of such Data.

                (1)  The arbitrator shall, within thirty (30) days of his or her
appointment, reach a decision as to whether the parties shall use Landlord's or
Tenant's submitted FMRR, and shall notify Landlord and Tenant of such
determination.

                (2)  The decision of the arbitrator shall be binding upon
Landlord and Tenant.

                (3)  If Landlord and Tenant fail to agree upon and appoint such
arbitrator, then the appointment of the arbitrator shall be made by the American
Arbitration Association.

                (4)  The cost of arbitration shall be paid by Landlord and
Tenant equally.

                (5)  The arbitration proceeding and all evidence given or
discovered pursuant thereto shall be maintained in confidence by all parties.

                                  Article 9.
                             Miscellaneous Matters

     9.01. Parking.

           (a)  Provided Tenant is not in default of any term or provision of
this Lease, Landlord agrees to provide Tenant for use by the employees, agents,
customers and invitees of Tenant the number of parking spaces designated on the
Basic Lease Information sheet on an unreserved and unassigned basis on those
portions of the Project designated by Landlord for parking. Tenant shall not use
more parking spaces than said number of parking spaces. The parking spaces will
not be separately identified and Landlord shall have no obligation to monitor
the use of the parking area. If a parking density problem occurs during the
Term, Landlord may address the problem, in its discretion, which solution may
include initiating a parking permit system or a reserved parking system and any
costs associated therewith (including, without limitation, costs of patrolling
the parking lot for compliance with the parking system) shall constitute a Basic
Operating Cost. All parking shall be subject to any and all rules and
regulations adopted by Landlord in its discretion from time to time. Only
automobiles no larger than full size passenger automobiles or pick-up trucks or
standard business use vehicles (which do not require parking spaces larger than
full size passenger automobiles) may be parked in the Project parking area.
Tenant shall not permit or allow any vehicles that belong to or are controlled
by Tenant or Tenant's employees, agents, customers or invitees to be loaded,
unloaded or parked in areas other than those reasonably designated by Landlord
for such activities. A failure by Tenant or any of its employees, agents,
customers or invitees to comply with the foregoing provisions shall afford
Landlord the right, but not the obligation, without notice, in addition to any
other rights and remedies available under this Lease, to remove and to tow away
the vehicles involved and to charge the cost to Tenant, which cost shall be
immediately due and payable within ten (10) days of demand by Landlord.

                                       38
<PAGE>

If Tenant relinquishes in writing (or by nonpayment, if a parking fee is
charged) any of such parking rights during the Term, Tenant shall no longer have
a right to the parking relinquished and may obtain future parking solely on a
space-available basis.

           (b)  Landlord reserves the right to charge a per-car parking fee
during the Term if such parking fees are mandated or otherwise imposed by
applicable law.

     9.02. Brokers. Landlord has been represented in this transaction by
Landlord's Broker. Tenant has been represented in this transaction by Tenant's
Broker. Upon full execution of this Lease by both parties, Landlord shall pay to
Landlord's Broker and Tenant's Broker a fee for brokerage services rendered by
it in this transaction provided for in separate written agreements between
Landlord and Landlord's Broker and Landlord and Tenant's Broker.

     Tenant represents and warrants to Landlord that the brokers named in the
Basic Lease Information sheet are the only agents, brokers, finders or other
similar parties with whom Tenant has had any dealings in connection with the
negotiation of this Lease and the consummation of the transaction contemplated
hereby. Tenant hereby agrees to indemnify, defend and hold Landlord free and
harmless from and against liability for compensation or charges which may be
claimed by any agent, broker, finder or other similar party by reason of any
dealings with or actions of Tenant in connection with the negotiation of this
Lease and the consummation of this transaction, including any costs, expenses
and attorneys' fees incurred with respect thereto.

     9.03. No Waiver. No waiver by either party of the default or breach of any
term, covenant or condition of this Lease by the other shall be deemed a waiver
of any other term, covenant or condition hereof, or of any subsequent default or
breach by the other of the same or of any other term, covenant or condition
hereof. Landlord's consent to, or approval of, any act shall not be deemed to
render unnecessary the obtaining of Landlord's consent to, or approval of, any
subsequent or similar act by Tenant, or be construed as the basis of an estoppel
to enforce the provision or provisions of this Lease requiring such consent.
Regardless of Landlord's knowledge of a default or breach at the time of
accepting Rent, the acceptance of Rent by Landlord shall not be a waiver of any
preceding default or breach by Tenant of any provision hereof, other than the
failure of Tenant to pay the particular Rent so accepted. Any payment given
Landlord by Tenant may be accepted by Landlord on account of monies or damages
due Landlord, notwithstanding any qualifying statements or conditions made by
Tenant in connection therewith, which statements and/or conditions shall be of
no force or effect whatsoever unless specifically agreed to in writing by
Landlord at or before the time of deposit of such payment.

     9.04. Recording. Either Landlord or Tenant shall, upon request of the
other, execute, acknowledge and deliver to the other a short form memorandum of
this Lease for recording purposes in a form reasonably acceptable to both Tenant
and Landlord.

     9.05. Holding Over. If Tenant holds over after expiration or termination of
this Lease without the written consent of Landlord, Tenant shall pay for each
month of hold-over tenancy one hundred fifty percent (150%) of the Net Rent
which Tenant was obligated to pay for the month immediately preceding the end of
the Term for each month or any part thereof of any such hold-over period,
together with such other amounts as may become due hereunder. No holding over by
Tenant after the Term shall operate to extend the Term. In the event of any
unauthorized holding over, Tenant shall indemnify, defend and hold Landlord
harmless from and against all claims, demands, liabilities, losses, costs,
expenses (including attorneys'fees), injury and damages incurred by Landlord as
a result of Tenant's delay in vacating the Leased Premises. Any holding over
with the consent of Landlord in writing shall thereafter constitute this Lease a
lease from

                                       39
<PAGE>

month-to-month, terminable upon thirty (30) days' notice from either party, at a
monthly rental rate of twice the Net Rent which Tenant was obligated to pay for
the month immediately preceding the end of the Term, together with such other
amounts as may become due hereunder.

     9.06. Transfers by Landlord. The term "Landlord" as used in this Lease
shall mean the owner(s) at the time in question of the fee title to the Leased
Premises or, if this is a sublease, of the Tenant's interest in the master
lease. If Landlord transfers, in whole, its rights and obligations under this
Lease or in the Project, upon its transferee's assumption of all of Landlord's
obligations and indemnities hereunder and delivery to such transferee of any
unused Security Deposit then held by Landlord, no further liability or
obligations shall thereafter accrue against the transferring or assigning person
as Landlord hereunder. Subject to the foregoing, the obligations and/or
covenants in this Lease to be performed by the Landlord shall be binding only
upon the Landlord as defined in this Section 9.06.
                                     ------------

     9.07. Attorneys' Fees. In the event either party places the enforcement of
this Lease, or any part of it, or the collection of any Rent due, or to become
due, hereunder, or recovery of the possession of the Leased Premises, in the
hands of an attorney, or files suit upon the same, the prevailing party shall
recover its reasonable attorneys' fees, costs and expenses, including those
which may be incurred on appeal. Such fees may be awarded in the same suit or
recovered in a separate suit, whether or not suit is filed or any suit that may
be filed is pursued to decision or judgment. The term "prevailing party" shall
include, without limitation, a party who substantially obtains or defeats the
relief sought, as the case may be, whether by compromise, settlement, judgment,
or the abandonment by the other party of its claim or defense. The attorneys'
fee award shall not be computed in accordance with any court fee schedule, but
shall be such as to fully reimburse all attorneys' fees reasonably incurred.

     9.08. Termination; Merger. No act or conduct of Landlord, including,
without limitation, the acceptance of keys to the Leased Premises, shall
constitute an acceptance of the surrender of the Leased Premises by Tenant
before the scheduled Term Expiration Date. Only a written notice from Landlord
to Tenant shall constitute acceptance of the surrender of the Leased Premises
and accomplish a termination of this Lease. Unless specifically stated otherwise
in writing by Landlord, the voluntary or other surrender of this Lease by
Tenant, the mutual termination or cancellation hereof, or a termination hereof
by Landlord for default by Tenant, shall automatically terminate any sublease or
lesser estate in the Leased Premises; provided, however, Landlord shall, in the
event of any such surrender, termination or cancellation, have the option to
continue any one or all of any existing subtenancies, but without any continuing
obligation by Tenant to such sublessee or lessor estate. Landlord's failure
within thirty (30) days following any such event to make any written election to
the contrary by written notice to the holder of any such lesser interest, shall
constitute Landlord's election to have such event constitute the termination of
such interest.

     9.09. Amendments; Interpretation. This Lease may not be altered, changed or
amended, except by an instrument in writing signed by the parties in interest at
the time of the modification. The captions of this Lease are for convenience
only and shall not be used to define or limit any of its provisions.

     9.10. Severability. If any term in or provision of this Lease, or the
application thereof to any person or circumstances, shall to any extent be
invalid or unenforceable, the remainder of this Lease, or the application of
such provision to persons or circumstances other than those as to which it is
invalid or unenforceable, shall not be affected thereby, and each provision of
this Lease shall be valid and shall be enforceable to the fullest extent
permitted by law.

     9.11. Notices. All notices, demands, consents and approvals which are
required or permitted by this Lease to be given by either party to the other
shall be in writing and shall be deemed to have been fully

                                       40
<PAGE>

given by personal delivery or by recognized overnight courier service or when
deposited in the United States mail, certified or registered, with postage
prepaid, and addressed to the party to be notified at the address for such party
specified on the Basic Lease Information sheet, 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 given in accordance with this Section 9.11,
                                                                  ------------
except that upon Tenant's taking possession of the Leased Premises, the Leased
Premises shall constitute Tenant's address for notice purposes. A copy of all
notices given to Landlord under this Lease shall be concurrently transmitted to
such party or parties at such addresses as Landlord may from time to time
hereafter designate by notice to Tenant.

     Any notice sent by registered or certified mail, return receipt requested,
shall be deemed given on the date of delivery shown on the receipt card, or if
no delivery date is shown, the postmark thereon. Notices delivered by recognized
overnight courier shall be deemed given twenty-four (24) hours after delivery of
the same to the courier. If notice is received on a Saturday, Sunday or legal
holiday, it shall be deemed received on the next business day. Tenant hereby
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 charge of or occupying the Leased 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 Leased Premises.

     9.12. Force Majeure. Any prevention, delay or stoppage of work to be
performed by Landlord or Tenant which is due to strikes, labor disputes,
inability to obtain labor, materials, equipment or reasonable substitutes
therefor, acts of God, governmental restrictions or regulations or controls,
judicial orders, enemy or hostile government actions, civil commotion, or other
causes beyond the reasonable control of the party obligated to perform
hereunder, shall excuse performance of the work by that party for a period equal
to the duration of that prevention, delay or stoppage. Nothing in this Section
                                                                       -------
9.12 shall excuse or delay Tenants obligation to pay Rent or other charges due
----
under this Lease.

     9.13. Guarantor. [Intentionally deleted.]

     9.14. Successors and Assigns. This Lease shall be binding upon and inure to
the benefit of Landlord, its successors and assigns (subject to the provisions
hereof, including, without limitation, Section 5.15), and shall be binding upon
                                       ------------
and inure to the benefit of Tenant, its successors, and to the extent assignment
or subletting, may be approved by Landlord hereunder, Tenant's assigns or
subtenants.

     9.15. Further Assurances. Landlord and Tenant each agree to promptly sign
all documents reasonably requested to give effect to the provisions of this
Lease.

     9.16. Incorporation of Prior Agreements. This Lease, including the exhibits
and addenda attached to it, contains all agreements of Landlord and Tenant with
respect to any matter referred to herein. No prior agreement or understanding
pertaining to such matters shall be effective.

     9.17. Applicable Law. This Lease shall be governed by, construed and
enforced in accordance with the laws of the State of California.

     9.18. Time of the Essence. Time is of the essence of each and every
covenant of this Lease. Each and every covenant, agreement or other provision of
this Lease on Tenant's part to be performed shall be deemed and construed as a
separate and independent covenant of Tenant, not dependent on any other
provision of this Lease or on any other covenant or agreement set forth herein.

                                       41
<PAGE>

     9.19.  No Joint Venture.  This Lease shall not be deemed or construed to
create or establish any relationship of partnership or joint venture or similar
relationship or arrangement between Landlord and Tenant hereunder.

     9.20.  Authority.  If Tenant is a corporation, trust or general or limited
partnership, each individual executing this Lease on behalf of Tenant represents
and warrants that he or she is duly authorized to execute and deliver this Lease
on Tenant's behalf and that this Lease is binding upon Tenant in accordance with
its terms. If Tenant is a corporation, trust or partnership, Tenant shall,
within ten (10) business days after request by Landlord, deliver to Landlord
evidence satisfactory to Landlord of such authority.

     9.21.  Declaration of Covenants, Conditions and Restrictions.  Tenant
acknowledges that it has received and read the CC&Rs for the Project and agrees
to comply with and be bound by all terms, conditions and provisions thereof.
Tenant further acknowledges and agrees that a default by Tenant under the CC&Rs
shall constitute a default hereunder. All obligations of Landlord hereunder
shall be limited to the extent performance of same is prohibited, restricted or
limited under the CC&Rs.

     9.22.  Offer.  Preparation of this Lease by Landlord or Landlord's agent
and submission of same to Tenant shall not be deemed an offer to lease to
Tenant. This Lease is not intended to be binding and shall not be effective
until fully executed by both Landlord and Tenant.

     9.23.  Waiver and Consent.  Landlord shall reasonably waive any rights to
furniture, trade fixtures or equipment installed by Tenant in the Leased
Premises which is collateral under a loan agreement for such furniture, trade
fixtures or equipment.

     9.24.  Collocation Agreements.  Landlord acknowledges and agrees that
Tenant may enter into agreements with end users of voice, video, data, computer,
telco, and telephone systems and equipment ("Collocation Agreements") provided
for physical location of such equipment within the Premises, provided that such
Collocation Agreements shall be subject and subordinate to the Lease and to any
mortgages, deeds of trust, or land sale contracts (hereinafter collectively
referred to as "encumbrances") now or in the future, against the Building. All
Collocation Agreements shall contain provisions: (i) unconditionally
acknowledging and agreeing to such subordination; (ii) requiring the parties
thereto to execute such documents as may reasonably be requested by Landlord or
the holder of the encumbrance to evidence the subordination; (iii) disclaiming
any right or interest in the Premises or the Lease; (iv) affirming that the
rights to locate such equipment and other items in the Premises shall terminate
as and when the Lease expires or is sooner terminated; (v) requiring,
notwithstanding any provision of the Collation Agreement, that the parties
thereto comply with the Lease, including without limitation, the rules and
regulations, from time to time in effect under the Lease; and (vi) having the
Tenant and other parties to such Collocation Agreement agreeing to indemnify,
defend and hold Landlord harmless from and against any claims, loss or damages
arising out of or relating to the Collocation Agreements. Tenant may enter into
Collocation Agreements with third parties, for the use of the Leased Premises in
the manner set forth above, at the sole discretion of Tenant; and, any provision
of the subletting and assignment provisions of the lease to the contrary
notwithstanding, such Collation Agreements shall not be construed as an
assignment or sublet.

     9.25.  Year 2000 Warranty.  With respect to all Building systems, Landlord
represents and warrants to the best of Landlord's knowledge that:

            (a)  the functionality of such systems, including, but not limited
to, any operating software, will not be affected by the change from the year
1999 to the year 2000 or by the existence of a leap year;

                                       42
<PAGE>

            (b)  any software operating any such systems will correctly input,
store, process, sort and output all date information for dates before, on any
after January 1, 2000; and,

            (c)  all dates that are input, stored, processed, sorted or output
by any software operating any such system will be in formats that preserve
century, decade and year information.

     If any essential services (such as HVAC, passenger elevators, electricity,
water) supplied by Landlord are interrupted, and the interruption is due to an
operating software failure caused by the change from the year 1999 to the year
2000 regardless of Landlord knowledge, Tenant shall be entitled to an abatement
of Rent and Additional Rent for the period of such interruption. The abatement
shall begin on the day of the interruption or when Tenant stops using the
Premises because of the interruption, whichever is later. The abatement shall
end when the services are fully restored. Tenant shall have the option to cancel
the Lease if the interruption unreasonably and materially interferes with
Tenant's use of or access to the Premises such that the Premises are rendered
untenantable or at lease thirty (30) consecutive days and Landlord is not
exercising its best efforts to restore the services. To exercise this option,
Tenant must give Landlord notice of the cancellation within ten (10) days from
the end of the thirty (30) day period.

     9.26.  Consents by Landlord or Tenant.  Whenever any provision in the Lease
requires either party's consent, Landlord and Tenant agree that such consent
shall not be unreasonably conditioned, withheld or delayed in light of the
party's unique business needs.

     9.27.  Exhibits; Addenda.  The following Exhibits and addenda are attached
to, incorporated in and made a part of this Lease: Exhibit A Floor Plan of the
                                                   ---------
Leased Premises; Exhibit B Initial Improvement of the Leased Premises; Exhibit C
                 ---------                                             ---------
Confirmation of Term of Lease; Exhibit D Building Rules and Regulations; Exhibit
                               ---------                                 -------
E Form of Fleet National Bank's Lease Subordination, Non-Disturbance and
-
Attornment Agreement; and Exhibit F Arbitration Procedure.
                          ---------

    [Remainder of page Intentionally left blank; signature page to follow.]

                                       43
<PAGE>

     9.28.  Tenant and Landlord agree that in the event that Tenant only
occupies one of the two buildings, than tenant and Landlord shall revise this
Lease to reflect the proper allocation of costs and uses of a multitenant
facility.

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

                              "LANDLORD":

                              CEP GIBRALTAR LLC, a Delaware limited liability
                              company

                              By: CEP INVESTORS XI LLC,
                                  a Delaware limited liability company,
                                  its sole Member

                                  By: EPI INVESTORS XI LLC,
                                      a California limited liability company,
                                      its Manager

                                      By:  Ellis Partners, Inc.,
                                           a California corporation,
                                           its Manager

                                           By:    /s/ James F. Ellis
                                                 -------------------------------
                                           Name:  JAMES F. ELLIS
                                                 -------------------------------
                                           Title:  Vice President
                                                 -------------------------------


                              "TENANT":

                              DIGITAL BROADCAST NETWORK CORPORATION,
                              a Missouri corporation

                              By: /s/ Bernard Schneider
                                 ------------------------------------------
                              Typed Name: Bernard Schneider
                                         ----------------------------------
                              Title: President & Chief Executive Officer
                                    ---------------------------------------


                              By: /s/ Mark Ivis
                                 ------------------------------------------
                              Typed Name: Mark Ivis
                                         ----------------------------------
                              Title: Vice President
                                    ---------------------------------------

                                       44
<PAGE>

                                   EXHIBIT A

                                  FLOOR PLAN
                                    OF THE
                                LEASED PREMISES

                                       45
<PAGE>

                               [GRAPHIC OMITTED]


                                  EXHIBIT "A"

                                       46
<PAGE>

                                   EXHIBIT B
                  INITIAL IMPROVEMENT OF THE LEASED PREMISES

     1.   Tenant Improvements and Landlord Improvements.  (The term "Landlord
          ---------------------------------------------
Shell Improvements" and the term "Landlord Improvements" shall have the same
meaning.) Tenant shall select a qualified specialty general contractor (the
"Contractor") and qualified subcontractors to construct and install the Tenant
Improvements (as defined below). The Contractor selected shall be subject to the
prior approval of Landlord, which approval Landlord shall not unreasonably
withhold, condition or delay. The Contractor shall construct and install the
tenant improvements (the "Tenant Improvements") in the Leased Premises,
substantially in accordance with plans, working drawings and specifications
("Tenant's Plans") prepared by Tenant's architects and approved by Landlord and
Tenant, which approval shall not be unreasonably withheld, conditioned or
delayed by either party. Landlord in its sole and absolute discretion, shall
perform, or may enter into a contract with one or more contractor(s) or
subcontractor(s) to perform, all or a portion of Landlord Shell Improvements in
accordance with Schedule B(1); however, any resulting coordination of site
construction shall be at the reasonable discretion of Tenant's Contractor. In
the event that such coordination results in additional costs to either Landlord
or Tenant, each shall absorb its own additional costs. The costs of preparing
Tenant's Plans and performing the Tenant Improvements and Landlord Improvements
shall be allocated between, and paid by, Landlord and Tenant as set forth in
this Exhibit B and Schedule B(1) and Schedule B(2) attached hereto.
     ---------

     2.   Landlord's Provision of Existing As-Built Drawings. To the extent in
          --------------------------------------------------
Landlord's possession, Landlord had provided Tenant with a set of base building
drawings and documentation including architectural, mechanical, plumbing,
engineering, electrical and life-safety drawings, together with similar drawings
for the Premises, and with said drawings in "soft" (CAD) form. No
representations are made by Landlord that such plans represent the current "as-
built" condition of the Premises ("Existing As-Built Drawings").

     3.   Tenant's Plans.  Tenant and Landlord shall mutually approve Tenant's
          --------------
Plans in writing; each party's approval shall not be unreasonably withheld,
conditioned or delayed. The architectural and engineering drawings portion of
Tenant's Plans shall be completed and submitted to Landlord for approval. If
Landlord shall not respond to Tenant's requested approval within such five (5)
business day period, then Landlord shall be deemed to have approved such plans
and specifications. If Landlord reasonably disapproves of Tenant's Plans, and
Tenant and Landlord are unable to agree upon such Plans or revised Plans within
five (5) additional days, then Tenant shall have the right to terminate this
Lease five (5) business days thereafter and Tenant's security deposit shall be
immediately returned. Tenant's architects, engineers and/or the Contractor shall
submit the architectural and engineering drawings portion of Tenant's Plans to
the City of Pleasanton. Once the City of Pleasanton delivers its comments to the
architectural and engineering drawings portion of Tenant's Plans, Tenant's
architects shall promptly prepare a response to the comments and submit the
response to the City of Pleasanton Such architectural and engineering drawings,
as approved by Tenant, Landlord and all government agencies with jurisdictional
authority thereover, shall be referred to herein as the "Approved Working
Drawings". The Approved Working Drawings shall be incorporated in Tenant's
Plans. Tenant's Plans shall comply with all applicable codes, laws, ordinances,
rules and regulations, including without limitation all Laws, as such term is
defined in Article 6 of the Lease (collectively, "Applicable Laws"), shall not
adversely affect a Building shell or core or any systems, components or elements
of a Building, except as specifically provided herein or therein, shall be in a
form sufficient to secure the approval of all government authorities with
jurisdiction over such Building, and shall be otherwise satisfactory to Landlord
in Landlord's reasonable discretion. Tenant's Plans shall be complete plans,
working drawings and specifications for the layout, improvement and finish of
the Leased Premises consistent with the design and construction of the

                                       47
<PAGE>

Building, including mechanical and electrical drawings and decorating plans,
showing as many of the following as possible:

          (1)   Location and type of all partitions;

          (2)   Location and type of all doors, with hardware and keying
schedule;

          (3)   Ceiling plans, including light fixtures;

          (4)   Location of telephone equipment room, with all special
electrical and cooling requirements;

          (5)   Location and type of all electrical outlets, switches, telephone
outlets, and lights;

          (6)   Location of all sprinklers (on a design build basis or in
consultation with a sprinkler engineer);

          (7)   Location and type of all equipment requiring special electrical
requirements;

          (8)   Location, weight per square foot and description of any heavy
equipment or filing system exceeding fifty (50) pounds per square foot live and
dead load;

          (9)   Requirements for air conditioning or special ventilation;

          (10)  Type and color of floor covering;

          (11)  Location, type and color of wall covering;

          (12)  Location, type and color of paint or finishes;

          (13)  Location and type of plumbing,

          (14)  Location and type of kitchen equipment;

          (15)  Indicate critical dimensions necessary for construction;

          (16)  Details showing all millwork with verified dimensions and
dimensions of all equipment to be built in, corridor entrances, bracing or
support of special walls or glass partitions, and any other items or information
requested by Landlord; and

          (17)  Location of all cabling relating to Tenant's base Tenant
Improvements.

     4.   Landlord Disclaimer of Tenant Plans.  Landlord's review and approval
          -----------------------------------
of Tenant's Plans shall not constitute, and Landlord shall not be deemed to have
made, any representation or warranty as to the compliance of the Tenant
Improvements with any laws or as to the suitability of the Leased Premises or
the Tenant Improvements for Tenant's needs.

                                       48
<PAGE>

     5.   Construction.
          ------------

          (1)  The Tenant Improvements in the Leased Premises shall be completed
substantially in accordance with Tenant's Plans by Contractor in a good and
workmanlike manner, using all new materials except where otherwise approved by
Landlord and Tenant, in compliance with all Applicable Laws. Landlord shall have
no liability to Tenant if the Leased Premises is not suitable for Tenant's
occupancy or if Landlord or Tenant has not obtained all or any necessary permits
required for Tenant to occupy the Leased Premises by the Term Commencement Date
unless such delay is caused by Landlord's unreasonable delay in review and
approval of Tenant's plans or Landlord's breach of its obligations under this
Lease.

          (2)  Notwithstanding Tenant's obligations pursuant to Section 4(a)
above, Landlord shall be responsible for the following (collectively "Landlord's
Improvements"):

               (1)  Landlord shall provide or construct the Landlord Shell
Improvements, as defined in Schedule B(1) attached hereto, in the Leased
                            -------------
Premises at its sole cost and expense, including Landlord's direct hard and soft
costs for architectural, design, engineering services, and reimbursable expenses
in connection therewith, and permit and application fees, in connection with the
construction of the Shell Improvements and Landlord's obligations with respect
to the Facility Requirements ("Landlord's Costs");

               (2)  Landlord shall cooperate in the provision of, provide or
construct the Facility Requirements as defined in Schedule B(2) Facility
                                                  -------------
Requirements, at Landlord's sole cost and expense, except as specifically
provided otherwise in such Schedule B(2). Landlord's direct hard and soft costs
                           -------------
for architectural, design, engineering services and reimbursable expenses, as
well as permit and application fees, incurred in performing its obligations with
respect to the Facility Requirements, shall be included in Landlord's Costs; and

               (3)  Landlord shall provide temporary power and lighting (277/480
volt and 120/208 volt) and water to the Leased Premises twenty four (24) hours
per day, seven (7) days per week, during the construction period at no cost to
Tenant.

          (3)  Within ten (10) days after Substantial Completion, Tenant shall
cause a Notice of Completion to be recorded in the office of the Recorder of the
County of Alameda in accordance with Section 3093 of the Civil Code of the State
of California or any successor statute, and shall furnish a copy thereof to
Landlord upon such recordation. If Tenant fails to do so, Landlord may execute
and file the same on behalf of Tenant as Tenant's agent for such purpose, at
Tenant's sole cost and expense. At the conclusion of construction, Tenant shall
cause the architect, engineers and Contractor (i) to update the Approved Working
Drawings as necessary to reflect all changes made to the Approved Working
Drawings during the course of construction, (ii) to certify to the best of their
knowledge that the "record-set" of mylar as-built drawings are true and correct
as of the date completed, which certification shall survive the expiration or
termination of this Lease, and (iii) to deliver to Landlord two (2) sets of
copies of such record set of drawings within ninety (90) days following
issuance of a certificate of occupancy for the Leased Premises. Within ninety
(90) days after Substantial Completion, Tenant shall deliver to Landlord a copy
of all warranties, guaranties, and operating manuals and information relating to
the improvements, equipment, and systems in the Leased Premises that are
Landlord Improvements completed by Tenant.

                                       49
<PAGE>

     6.   Landlord's Contribution.
          -----------------------

          (1)  Subject to the condition precedent that Landlord has approved the
Tenant Plans, which approval shall not be unreasonably withheld; conditioned or
delayed, Landlord shall provide Tenant an allowance not to exceed a maximum
amount of THIRTY DOLLARS ($30.00) per square foot of Rentable Area, calculated
as THREE MILLION FIFTY THOUSAND TWO HUNDRED FIFTY DOLLARS ($3,050,250.00) based
upon a Rentable Area of 101,675 square feet ("Landlord's Contribution"), to
apply to Tenant Improvement Costs. Tenant Improvement Costs shall include the
following:

               (1)  the cost of Tenant Plans, including without limitation
reimbursable expenses by Tenant's architects;

               (2)  Landlord's direct hard and soft costs to review Tenant Plans
and supervise construction of Tenant Improvements, including without limitation
Landlord's internal costs, architects', engineers' and other consultants'
services, fees and reimbursable expenses in connection therewith ("Landlord's
Review and Supervision Costs") subject to the limitations described below;

               (3)  the cost to construct Facility Requirements which are not
allocated specifically to Landlord pursuant to Schedule B(1); and
                                               -------------

               (4)  the direct costs of constructing Tenant Improvements other
than the Landlord's Improvements.

Notwithstanding the foregoing, Landlord may only offset up to an aggregate
amount of TWENTY-FIVE THOUSAND DOLLARS ($25,000.00) ("Review Expense Cap") of
Landlord's Contribution to reimburse Landlord for Landlord's review and
Supervision Costs as and when the same are incurred. Landlord's Review and
Supervision Costs in excess of the Review Expense Cap shall be borne and paid by
Landlord.

          (2)  Landlord shall pay Landlord's Contribution directly to Tenant
within ten days after the occurrence of the following: (i) Substantial
Completion; and (ii) receipt by Landlord of paid invoices and unconditional lien
releases for all work done by Tenant's architect(s), engineer(s) and Tenant's
Agents with respect to the Tenant Improvements; (iii) Term Commencement. Tenant
shall indemnify and protect Landlord against any liability for mechanics,
materialmen's and other liens or claims with respect to the Tenant Improvements
and shall obtain releases to liens as payments are made relating to such liens.

          (3)  Tenant Improvement Costs and any other costs (other than
Landlord's Costs) of preparing Tenant's Plans and constructing the Tenant
Improvements in excess of Landlord's Contribution shall be paid by Tenant.

     7.   Changes. Except for minor, immaterial or nonstructural changes, if
          -------
Tenant requests any change in Tenant's Plans, Tenant shall request such change
in a written notice to Landlord. All changes in Tenant's Plans (except for minor
and immaterial changes) shall be subject to the prior written approval of
Landlord which shall be given within three (3) business days (which shall not be
unreasonably withheld) or shorter period of time if time is of the essence.

<PAGE>

     8.   Other Work by Tenant. All work not within the scope of the normal
          --------------------
construction trades employed on the Building, such as the furnishing and
installing of furniture, telephone equipment, office equipment and wiring,
shall be furnished and installed by Tenant at Tenant's expense.

     9.   Requirements for Other Work Performed by Tenant. All other work
          -----------------------------------------------
performed at the Buildings or in the Project by Tenant or Tenant's contractor or
subcontractors shall be subject to the following additional requirements:

          (1)  Such work shall not proceed until Landlord has approved in
writing which approval shall not be unreasonably withheld: (i) Tenant's
contractor, (ii) the amount and coverage of public liability and property damage
insurance, with Landlord named as an additional insured, carried by Tenant's
contractor, (iii) reasonably complete and detailed plans and specifications for
such work, and (iv) an anticipated schedule for the work.

          (2)  All work shall be done in conformity with a valid permit when
required, a copy of which shall be furnished to Landlord before such work is
commenced. In any case, all such work shall be performed in accordance with all
applicable laws. Notwithstanding any failure by Landlord to object to any such
work, Landlord shall have no responsibility for Tenant's failure to comply with
applicable laws.

          (3)  This section has been intentionally left blank.

          (4)  All subcontractors, laborers, materialmen and suppliers retained
directly by Tenant shall conduct their activities in and around the Leased
Premises, the Buildings and the Project in a harmonious relationship with all
other subcontractors, laborers, materialmen and suppliers at the Leased
premises, the Buildings and the Project, and, if necessary, Tenant shall employ
all reasonable efforts to achieve such harmonious relations.

          (5)  Tenant shall be responsible for cleaning the Leased Premises, the
Building and the Project and removing all debris in connection with the its
work. All completed work shall be subject to inspection and acceptance by
Landlord. Tenant shall reimburse Landlord for the cost all extra expense
incurred by Landlord by reason of faulty work done by Tenant or Tenant's
contractor or by reason of inadequate cleanup by Tenant or Tenant's contractor
which Landlord incurs after notice to Tenant and Tenant fails to complete.
Landlord will provide Tenant with copies of third party consultant invoices
within five (5) business days of Tenant's request for such invoices.

     10.  Tenant Delay. If the completion of the Tenant Improvements, including
          ------------
without limitation Landlord's Improvements, is delayed (i) at the request of
Tenant, (ii) by Tenant's failure to comply with the foregoing provisions
(including failure to pay any sums payable by Tenant within the time periods
specified herein), (iii) by changes in the Tenant's Plans ordered by Tenant or
by extra work ordered by Tenant, (iv) because Tenant chooses to have additional
work performed by Landlord, or (v) because of any other act or omission of
Tenant (collectively, "Tenant Delay"), then Tenant shall be responsible for all
costs and any expenses occasioned by such Tenant Delay including, without
limitation, any costs and expenses attributable to increases in labor or
materials; and, if such delay actually delays Substantial Completion beyond the
Term Commencement Date, then Tenant shall pay Lessor the Base Rent for the
entire period of such delay occuring after the Term Commencement Date.

<PAGE>

     11.  Delivery of Leased Premises for Occupancy. Prior to occupancy,
          -----------------------------------------
Landlord shall, at Landlord's cost and without demand upon Landlord's
Contribution, deliver the Building clean and free of debris, with all
electrical, mechanical and plumbing systems in good working order.

     12.  Tenant's Warranties. Tenant represents, covenants and warrants, and
          -------------------
acknowledges that Landlord is relying upon such covenants, representations and
warranties as a condition to Landlord's warranties under this Lease, as follows:

          (1)  Subject to Landlord's representation and warranty pursuant to
Section 16(1) of this Exhibit B, the Tenant Plans shall provide for, and upon
                      ---------
Substantial Completion of the Tenant Improvements and the Facility Requirements
pursuant to the Tenant Plans, Building I and Building II shall have seismic
ratings no less than their respective ratings as of the effective date of this
Lease.

          (2)  Tenant Plans shall comply with all Applicable Laws and shall
provide for the design, engineering and construction of the Tenant Improvements,
including without limitation those Facility Requirements which are the
responsibility of Tenant to perform pursuant to Schedule B(2) hereof, in
                                                -------------
compliance with (i) Applicable Laws, (ii) applicable standards of the American
Insurance Association (formerly the National Board of Fire Underwriters) and any
other similar body, and the National Electrical Code, and (iii) all building
material manufacturer's specifications.

          (3)  Subject to Landlord's representations and warranties with respect
to Landlord's Improvements specifically provided in the Lease and Section 16 of
this Exhibit B, Tenant Improvements and all of the Facility Requirements which
     ---------
are the responsibility of Tenant to perform pursuant to Schedule B(2) hereof,
                                                        -------------
including those Shell Improvements and Facilities Requirements performed by
Tenant hereunder at Landlord's cost, and all other work performed by Tenant
hereunder, shall be completed in a good and workmanlike manner, using new
materials, and in accordance with Applicable Laws, and, as of Substantial
Completion, shall be in compliance with (i) all Applicable Laws, except that
with respect to compliance with ADA Requirements, such representations and
warranty shall be limited to compliance of interior access and interior space of
the Leased Premises, (ii) applicable standards of the American Insurance
Association (formerly the National Board of Fire Underwriters) and any other
similar body, and the National Electrical Code, and (iii) all building material
manufacturer's specifications.

     13.  Tenant Warranties With Respect to Tenant's Agents: Contractor
          -------------------------------------------------------------
Warranties. Tenant warrants that the Contractor (collectively, "Tenant's
----------
Agents") shall guarantee to Tenant and for the benefit of Landlord that the
portion of the Tenant Improvements for which it is responsible shall be free
from any defects in workmanship and materials for a period of not less than one
(1) year from the date of completion thereof or the period warranted by such
Tenant's Agent, whichever is longer. Each of Tenant's Agents shall be
responsible for the replacement or repair, without additional charge, of all
work done or furnished in accordance with its contract that shall become
defective within one (1) year after the later to occur of (i) completion of the
work performed by such contractor or subcontractors and (ii) the Lease
Commencement Date. The correction of such work shall include, without additional
charge, all additional expenses and damages incurred in connection with such
removal or replacement of all or any part of the Tenant Improvements, and/or the
Building and/or common areas that may be damaged or disturbed thereby. All such
warranties or guarantees as to materials or workmanship of or with respect to
the Tenant Improvements shall be contained in the contract with the Contractor
or subcontract with any subcontractor, as appropriate, and shall be written such
that such guarantees or warranties shall inure to the benefit of both Landlord
and Tenant, as their respective interests may appear, and can be directly
enforced by either. Tenant covenants to give to

<PAGE>

Landlord any assignment or other assurances which may be necessary to effect
such right of direct enforcement.

     14.  Tenant's Insurance Requirements. From the time Tenant accesses either
          -------------------------------
of the Buildings and at all times through the date of Substantial Completion for
both Buildings, Tenant shall 1 maintain the following insurance coverage:

          (1)  General Coverages. All of Tenant's Agents shall carry worker's
               -----------------
compensation insurance covering all of their respective employees, and shall
also carry public liability insurance, including property damage, all with
limits, in form and with companies as are required to be carried by Tenant as
set forth in Article 7 of this Lease.

          (2)  Coverage Required by Lease. Tenant shall maintain the insurance
               --------------------------
policies and coverage required by Section 7.02 and Section 7.03 of the Lease.

          (3)  Special Coverages. Landlord.
               -----------------

          (4)  General Terms. Certificates for all insurance carried pursuant to
               -------------
this Section 15 shall be delivered to Landlord before the commencement of
construction of the Tenant Improvements and before the Contractor's equipment is
moved onto the site. All such policies of insurance must contain a provision
that the company writing said policy will give Landlord thirty (30) days' prior
written notice of any cancellation or lapse of the effective date or any
reduction in the amounts of such insurance. In the event that the Tenant
Improvements are damaged by any cause during the course of the construction
thereof, Tenant shall immediately repair the same at Tenant's sole cost and
expense. Tenant's Agents shall maintain all of the foregoing insurance coverage
in force until the Tenant Improvements are fully completed and accepted by
Landlord. All policies carried under this Section 14 shall insure Landlord and
Tenant, as their interests may appear, as well as Contractor and Tenant's
Agents. All insurance, except Workers' Compensation, maintained by Tenant's
Agents shall preclude subrogation claims by the insurer against anyone insured
thereunder. Such insurance shall provide that it is primary insurance as
respects the Landlord and that any other insurance maintained by Landlord is
excess and noncontributing with the insurance required hereunder. The
requirements for the foregoing insurance shall not derogate from the provisions
for indemnification of Landlord by Tenant under Section 15 of this Exhibit B.
                                                                   ---------

     15.  Tenant's Indemnification of Landlord. Tenant's indemnity of Landlord
          ------------------------------------
as set forth in Section 7.04 of this Lease shall also apply with respect to any
and all costs, losses, damages, injuries and liabilities related in any way to
any act or omission of Tenant or Tenant's Agents, or anyone directly or
indirectly employed by any of them, or in connection with Tenant's non-payment
of any amount arising out of the Tenant Improvements and/or Tenant's disapproval
of all or any portion of any request for payment. Such indemnity by Tenant, as
set forth in Section 7.04 of this Lease, shall also apply with respect to any
and all costs, losses, damages, injuries and liabilities related in any way to
Landlord's performance of any ministerial acts reasonably necessary (i) to
permit Tenant to complete the Tenant Improvements, and (ii) to enable Tenant to
obtain any building permit or certificate of occupancy for the Premises.

                                       53
<PAGE>

                                  EXHIBIT  B
                  INITIAL IMPROVEMENTS OF THE LEASED PREMISES

                                 Schedule B(1)
                                 -------------
                              Shell Improvements
                              ------------------

     Without demand upon the Improvement Allowance, at Landlord's sole expense,
prior to the Commencement Date, except as otherwise noted below, Landlord shall
cause the following "Shell Improvements":

     (1)  Painting of Building Exteriors. Landlord shall cause, or increase
          ------------------------------
          Landlord's Contribution by the amount of an allowance for, the re-
          painting of portions of the exterior of the Buildings in a color
          scheme determined by Tenant and reasonably acceptable to Landlord and
          subject to the approval of the Hacienda Owners' Association and the
          City of Pleasanton;

     (2)  Gibraltar Center II Building Interior Alterations. With respect to the
          -------------------------------------------------
          two-story Gibraltar Center II Building, promptly following the
          execution hereof, Landlord shall cause the removal of the existing
          interior improvements including partition walls (but, excluding the
          core area restrooms, elevator equipment room, base building mechanical
          rooms, phone room, janitor closet and electrical rooms), any remaining
          ceiling assembly, raised floor computer room including removal of
          raised floor assembly, ceiling, mechanical systems, halon, etc., (but
          excluding any restoration of the depressed slab), data/telecom wiring,
          and such other items as Landlord and Tenant may mutual agree.

     (3)  Roof. Landlord shall cause, or increase Landlord's Contribution by the
          ----
          amount of an allowance for, the replacement of the existing roof with
          a bonded ten-year roof assembly (unless the existing roof has a
          remaining useful life in excess of three (3) years);

     (4)  HVAC. Landlord shall cause, or increase Landlord's Contribution by the
          ----
          amount of an allowance for, the replacement of the existing HVAC,
          mechanical equipment, that does not have an estimated remaining useful
          life, based on normal office use, in excess of three (3) years;

     (5)  Floors. Landlord shall, except for the depressed slab area of the two-
          ------
          story Gibraltar Center I Building, complete any material floor
          leveling required to the Building's floors that can not be reasonably
          worked around by Tenant;

     (6)  Hardscape. Landlord shall cause the replacement of any damaged
          ---------
          hardscape that has cracked, lifted or presents a tripping hazard;

     (7)  Parking Surfaces. Landlord shall cause any damaged sections of the
          ----------------
          parking area to be removed and replaced and to cause the entire
          asphalt surface to be slurry-sealed and to be striped in accordance
          with first-class commercial standards;

     (8)  Lighting and Landscaping. Landlord shall ensure that all exterior
          ------------------------
          lighting and landscaping systems are in good operable condition and
          that the grounds are in first-class condition; and

                                       54
<PAGE>

     (9)  Permits and Fees. Landlord shall pay all permits and fees associated
          ----------------
          with Landlord's Shell Improvements.

     (10) Landlord shall cause the base Building and all base building systems
          to be in compliance with all Applicable Laws as of the Term
          Commencement Date; however, any code compliance required by reason of
          Tenant's specific use of the Premises, in excess of general office
          use, shall be the responsibility of Tenant. With respect to compliance
          costs applicable to the Americans With Disabilities Act, Landlord
          shall cause, at Landlord's sole cost and expense, the path of travel
          outside the Buildings to be ADA compliant as of the Term Commencement
          Date.

                                       55
<PAGE>

                                   EXHIBIT B
                  Initial Improvements of the Leased Premises

                                 Schedule B(2)
                                 -------------
                             Facility Requirements
                             ---------------------

     Landlord and Tenant shall allocate responsibility for construction of the
following improvements as provided below ("Facility Requirements"):

     (1)  Electrical Service. Landlord shall, at Landlord's expense, except for
          ------------------
          utility fees associated with the inadequate utility demand
          requirements of Tenant, increase the existing 2,000 amp 480/277 volts
          service of one of the Buildings, the actual building to be determined
          by Tenant prior to the Commencement Date, to 4,000 amps, 480/277
          volts, 3-phase, 4-wire. Additionally, Landlord shall provide Tenant
          the right to upgrade, at Tenant's expense, the existing service to
          either or both of the Buildings as Tenant may reasonably require.

     (2)  HVAC. Tenant anticipates a dedicated HVAC requirement of .5 tons per
          ----
          100 square feet of demised area, sized between 75 and 100 tons, for
          primary and redundant cooling needs. Aside from Landlord's
          cooperation, all costs to install the foregoing shall be at Tenant's
          expense.

     (3)  Emergency Generators. Landlord shall cooperate with Tenant in the
          --------------------
          installation of the three (3) emergency generators, sized between 800
          and 1250 KVA, with accompanying fuel capacities totaling approximately
          15,000 gallons, approved under the terms of the Lease. Aside from
          Landlord's cooperation, all costs to install the foregoing shall be at
          Tenant's expense.

     (4)  Core Drilling. Subject to Landlord's reasonably approval, Landlord
          -------------
          shall grant Tenant, at its sole cost and expense, the right to core
          drill or otherwise penetrate the concrete slab floor of the Premises
          and/or Building in order to: (1) to install conduits and
          fiber/wire/cable therein; (2) to make necessary electrical
          connections; (3) to make necessary HVAC connections; and, (4) to bolt
          and/or anchor its computer hardware and telecommunications racks and
          equipment.

     (5)  Dry Coolers/Condensing Units. Subject to Landlord's reasonable
          ------------------------------
          approval, and that of the Hacienda Owners Association and the City Of
          Pleasanton, Landlord shall grant Tenant, at its sole cost and expense,
          the right to install dry coolers/condensing units necessary to
          Tenant's HVAC system in a location within reasonably close proximity
          to the Premises, and either at ground level or on the roof of the
          Building, as such location and placement may be mutually acceptable to
          Landlord and Tenant.

     (6)  Fiber Optic Connectivity. Landlord shall agree to cooperate, at its
          ------------------------
          expense, with Tenant in granting redundant fiber optic access to the
          Building, by a vendor selected by Tenant, for the purpose of providing
          Tenant with such connectivity; however, the cost of providing such
          fiber optic access to the Building shall be borne solely by Tenant.
          Tenant shall require at least four (4) points of diverse entry at
          opposing ends of the Building with not less that fifty (50) foot
          separation. To the extent available for use and if desirable by
          Tenant, Landlord shall grant Tenant the right to use, at its sole cost
          and expense, existing fiber ducts installed by Landlord.


<PAGE>

                                   EXHIBIT C

                         CONFIRMATION OF TERM OF LEASE

     This Confirmation of Term of Lease is made by and between __________, a
_________, as Landlord, and ________________, a ____________, as Tenant, who
agree as follows:

     1.   Landlord and Tenant entered into a Lease dated _______________, 19___
(the "Lease"), in which Landlord leased to Tenant and Tenant leased from
Landlord the Leased Premises described in the Basic Lease Information sheet of
the Lease (the "Leased Premises").

     2.   Pursuant to Section 3.01 of the Lease, Landlord and Tenant agree to
                      ------------
confirm the commencement date and expiration date of the Term of the Lease as
follows:

          a.   ____________________________, 19____, is the Term Commencement
               Date;

          b.   ____________________________, 19____, is the Term Expiration
               Date;

          c.   ____________________________, 19____, is the commencement date of
               Rent under the Lease.

     3.   Tenant hereby confirms that the Lease is in full force and effect and:

          a.   It has accepted possession of the Leased Premises as provided in
               the Lease;

          b.   The improvements and space required to be furnished by Landlord
               under the Lease have been furnished,

          c.   Landlord has fulfilled all its duties of an inducement nature;

          d.   The Lease has not been modified, altered or amended, except as
               follows:

               _________________________________________________________________
               ________________; and


          e.   There are no setoffs or credits against Rent and no security
               deposit has been paid except as expressly provided by the Lease.

    [Remainder of page Intentionally left blank; signature page to follow.]


<PAGE>

     4.   The provisions of this Confirmation of Term of Lease shall inure to
the benefit of, or bind, as the case may require, the parties and their
respective successors, subject to the restrictions on assignment and subleasing
contained in the Lease.

     DATED: ___________________________, 19____.

"LANDLORD":                                         "TENANT".

__________                                          __________
a ________                                          a ________

By:___________________________                      By:_______________________
Typed Name:___________________                      Name:_____________________
Title:________________________                      Title:____________________


<PAGE>

                                  EXHIBIT D

                        BUILDING RULES AND REGULATIONS

     1.   The sidewalks, doorways, halls, stairways, vestibules and other
similar areas shall not be obstructed by Tenant or used by it for any purpose
other than ingress to and egress from the Leased Premises, and for going from
one part of the Building to another part. Corridor doors, when not in use, shall
be kept closed. Before leaving the Building, Tenant shall ensure that all doors
to the Leased Premises are securely locked and all water faucets are shut off.

     2.   Plumbing fixtures shall be used only for their designated purpose, and
no foreign substances of any kind shall be deposited therein. Damage to any such
fixtures resulting from misuse by Tenant or any employee or invitee of Tenant
shall be repaired at the expense of Tenant.

     3.   Tenant shall not mar or deface the Leased Premises in any way. Tenant
shall not place anything on or near the glass of any window, door or wall which
may appear unsightly from outside the Leased Premises.

     4.   Tenant shall assume all risks of damage and pay the cost of repairing
or providing compensation for damage to the Building, to articles moved and
injury to persons or property resulting from such moves. Landlord shall not be
liable for any acts or damages resulting from any such activity.

     5.   Nothing shall be swept or thrown into the corridors, halls, elevator
shafts or stairways. No birds, fish or animals of any kind shall be brought into
or kept in, an or about the Leased Premises, with the exception of guide dogs
where necessary.

     6.   No cooking shall be done in the Leased Premises except in connection
with a convenience lunch room for the sole use of employees and guests (on a
non-commercial basis) in a manner which complies with all of the provisions of
the Lease and which does not produce fumes or odors.

     7.   Tenant shall not install or operate on the Leased Premises any
electric heater, stove or similar equipment without Landlord's prior written
consent. Tenant shall not use or keep on the Leased Premises any kerosene,
gasoline, or inflammable or combustible fluid or material other than limited
quantities reasonably necessary for the operation and maintenance of office
equipment utilized at the Leased Premises. No explosives shall be brought onto
the Project at any time.

     8.   Tenant shall not waste electricity, water or air conditioning and
agrees to cooperate fully with Landlord to assure the most effective operation
of the Building's heating and air conditioning and to comply with any
governmental energy-saving rules, laws or regulations of which Tenant has actual
notice.

     9.   Landlord retains the right at any time, without liability to Tenant,
to change the name of the Building, except as otherwise expressly provided in
the Lease with respect to signage.

     10.  No smoking shall be permitted in the Building.

     11.  Landlord reserves the right to rescind any of these rules and
regulations and to make future rules and regulations required for the safety,
protection and maintenance of the Project, the operation and preservation of the
good order thereof, and the protection and comfort of the tenants and their
employees and visitors; provided however, in no event shall any such
modifications to these rules and regulations either

<PAGE>

                                   EXHIBIT F
                                   ---------

                             ARBITRATION PROCEDURE
                             ---------------------

     If a Dispute (as hereinafter defined) arises, then either party may
commence arbitration with respect to the Dispute by notice to the other party
("Arbitration Notice"). As used in this Exhibit F, the term "Dispute" shall be
limited to a dispute arising (i) under Section 5.04 of the Lease with respect to
Landlord's obligation to reimburse Tenant, (ii) under Section 4.06 of the Lease,
and/or (iii) with respect to whether a consent which, under the Lease, may be
denied only on a "reasonable basis" has in fact been denied on such a basis;
provided, however, that the term "Dispute" shall not, under any circumstances,
include disputes with respect to the payment of Rent (other than to the extent
that a dispute covered by the preceding clauses (i) and/or (ii) might affect
Tenant's obligation to pay Additional Rent). Within thirty (30) days of the
Arbitration Notice, Landlord and Tenant shall jointly select an arbitrator, or
if they are unable to reach agreement on the arbitrator, in accordance with the
then current arbitration rules and procedures (the "Rules") of JAMS-Endispute
("JAMS") from a list of qualified people maintained by JAMS. Neither Landlord
nor Tenant shall consult with such arbitrator as to his or her opinion as to the
Dispute prior to the appointment. The determination of the arbitrator shall be
limited solely to the Dispute. The arbitration shall take place in San
Francisco, California and all expedited procedures prescribed by the Rules shall
apply. Such arbitrator may hold hearings and require such briefs as the
arbitrator, in his or her sole discretion, determines is necessary. In addition,
Landlord or Tenant may submit to the arbitrator, with a copy to the other party,
within five (5) business days after the appointment of the arbitrator any data
and additional information that such party deems relevant to the determination
by the arbitrator and the other party may submit a reply in writing within five
(5) business days after receipt of such data and additional information. The
arbitrator shall conduct such evidentiary hearings as the arbitrator deems
necessary or appropriate.

     1.   The arbitrator shall, within thirty (30) days of his or her
appointment, reach a decision as to the Dispute, and shall notify Landlord and
Tenant of such determination.

     2.   The decision of the arbitrator shall be binding upon Landlord and
Tenant.

     3.   If Landlord and Tenant fail to agree upon other matters relating to
the arbitration, then the Rules shall govern such arbitration.

     4.   The cost of arbitration shall be paid by the substantially
unsuccessful party.

     5.   The arbitration proceeding and all evidence given or discovered
pursuant thereto shall be maintained in confidence by all parties.

     6.   Judgment upon the award rendered by the arbitrator may be entered by
either party in any court having jurisdiction, or application may be made to
such court for a judicial recognition of the award or an order of enforcement
thereof, as the case may be.

                                       60
<PAGE>

     (7)  Intra-Building Risers. At no additional expense to Tenant, Tenant
          ---------------------
          shall have the right to access the Buildings' risers for vertical and
          horizontal telecommunications wire/cable distribution to the Premises
          for mechanical distribution and for electrical distribution; however,
          the cost of providing additional riser access to the Buildings shall
          be borne solely by Tenant. If desired by Tenant and at no expense to
          Landlord, Tenant may create a separate and secure MPOE (minimum point
          of entry) on the ground floor of the Buildings, in a location mutually
          agreed upon by Landlord and Tenant, with the square footage of such
          area, and the rent applicable thereto, to be part of the Leased
          Premises.

     (8)  Satellite Dish/Antennae. Subject to the approval by the Hacienda
          -----------------------
          Owners' Association and the City of Pleasanton, which, if required,
          shall be obtained by Tenant at its expense, Tenant may, at its own
          expense, install on the roof of the Buildings such antennae, satellite
          dish or similar equipment as may be required to conduct its business,
          at such locations and in such quantities as are reasonably approved by
          Landlord. Tenant shall adhere to industry standards for installation
          and workmanship, all work to be completed to Landlord's reasonable
          satisfaction. All engineering and design work shall be undertaken by
          Tenant, at its sole expense. Upon termination of the lease, Tenant
          shall, if so requested by Landlord, remove all of Tenant's equipment
          and shall repair, to Landlord's reasonable satisfaction, any damage
          caused by the installation or removal of such equipment. To maintain
          any roof warranty of the Buildings, Tenant shall use such roofing
          contractors as directed by Landlord.

     (9)  Underground Boring. Tenant may lay four separate, distinct routes of
          ------------------
          underground fiber optic cable to the Leased Premises, originating and
          entering either or both of the buildings at opposing sides of each
          building, with a separation of not less that fifty feet, as such
          location may be agreed upon by Landlord and Tenant as provided below.
          Tenant shall utilize computer driven underground directional boring
          equipment to "trench" for its cable installation without disturbing
          the sidewalk, landscape areas or the parking area with the possible
          exception of a small "insertion" areas. Tenant will utilize expert
          underground detection services to locate and avoid any utility or
          similar lines or structures located below the driveway surface.
          Further, Tenant shall indemnify and hold the Landlord harmless from
          any potential liability from Tenant's underground boring activities.
          Tenant shall submit to Landlord, for Landlord's prior approval, the
          desired route of all underground boring.

     (10) Fire Protection & Life Safety. Within a portion of the Leased
          -----------------------------
          Premises, Tenant, at its cost and expense, may install an additional
          fire suppression system and modify any existing fire sprinkler system
          within the Leased Premises to avoid a water discharge unless a real
          fire threat exists. Said modifications may include the installation of
          high temperature sprinkler heads and the modification of the sprinkler
          control system effecting the Leased Premises such that the sprinkler
          system will be a "dry-pipe", "pre-action" system controlled by a fire
          sensor that will not pressurize the pipes with water until the sensor
          "reads" a fire. Tenant will comply with the requirements of the local
          fire protection authorities. Landlord, at Tenant's sole cost and
          expense, will cooperate fully with Tenant in Tenant's efforts to
          install a fire suppression system, including redundant fire
          suppression systems, such as FM-200 or such other similar fire
          suppression agent. Tenant, at its cost and expense, shall be
          responsible for the restoration of the main sprinkler distribution.

                                       61
<PAGE>

                                   EXHIBIT B
                  INITIAL IMPROVEMENTS OF THE LEASED PREMISES

                                  SCHEDULE 3

FM200
UPS
Transfer Switches
HVAC/Chillers installed by Tenant
DC Power Plant
Raised Access Flooring
Telecommunications Equipment
Security Systems
Plasma Screens and the like
Generators

                                       62