LEASE
                                      -----

                                 by and between

                      MARTIN/CAMPUS ASSOCIATES NO. 4, L.P.
                                   "Landlord"

                                       and

                                BROADVISION, INC.
                                    "Tenant"








                For the approximately 55,282 sq. ft. Premises at
                                  405 Broadway,
                             Redwood City, CA 94063
<PAGE>
                                  LEASE SUMMARY
                                  -------------



Lease Date:                 February 10, 1999


Landlord:                   Martin/Campus Associates No. 4, L.P.


Address of Landlord:        c/o The Martin Group
                            100 Bush Street, 26th Floor
                            San Francisco, CA 94104


Tenant:                     Broadvision, Inc.


Address of Tenant:          585 Broadway
                            Redwood City, CA 94063

Contact:                    _________________________


Telephone:                  (650) 261-5100


Building Addresses:         405 Broadway
                            Redwood City, California


Total Premises Square Footage:      Approximately 55,282 square
                                    feet


Estimated Commencement Date:        August 26, 1999


Term:                               approximately one hundred
                                    (100)months (see PARAGRAPH
                                    4.A.)


Monthly Rent:                       An amount equal to Two and
                                    25/100ths Dollars ($2.25)

<PAGE>
                                    multiplied  by the amount of
                                    Rentable Area of the Premises,
                                    as determined under PARAGRAPH
                                    2, subject to adjustment(see
                                    PARAGRAPHS 4.C AND 5.B)

Security Deposit:                   An amount equal to four (4)
                                    installments of the initial
                                    Monthly Rent, subject to
                                    adjustment(see PARAGRAPH 7)



Exhibits A-1 and A-2:       Floor Plans of Premises
Exhibit B:                  Work Letter Agreement
Exhibit B-1:                Rendering of Building Exterior and
                            Elevation for Premises
Exhibit B-2:                Site Plan for the Premises
Exhibit B-3:                Schedule for Construction of
                            Improvements
Exhibit C:                  Site Plan for the Project
Exhibit D:                  Commencement Date Memorandum
Exhibit E:                  Subordination, Nondisturbance and
                            Attornment Agreement
Exhibit F:                  Memorandum of Lease

<PAGE>
                                TABLE OF CONTENTS
                                -----------------

                                                                           Page

1.       PARTIES..............................................................1

2.       PREMISES.............................................................1

3.       DEFINITIONS..........................................................1
         A.       AFFILIATE...................................................1
         B.       ALTERATIONS.................................................2
         C.       BUILDING....................................................2
         D.       CAPITAL IMPROVEMENTS........................................2
         E.       CC&RS.......................................................2
         F.       COMMENCEMENT DATE...........................................2
         G.       COMMON AREA.................................................2
         H.       COMMON AREA MAINTENANCE COSTS...............................3
         I.       EXISTING BUILDINGS..........................................7
         J.       EXISTING PROJECT SPACE......................................8
         K.       FINAL PLANS.................................................8
         L.       HVAC........................................................8
         M.       IMPOSITIONS.................................................8
         N.       IMPROVEMENTS................................................9
         O.       INTEREST RATE...............................................9
         P.       LANDLORD'S AGENTS...........................................9
         Q.       MONTHLY RENT................................................9
         R.       PARKING AREA................................................9
         S.       PERSON......................................................9
         T.       PREMISES...................................................10
         U.       PROJECT....................................................10
         V.       REAL PROPERTY TAXES........................................10
         W.       RENT.......................................................11
         X.       RENTABLE AREA..............................................11
         Y.       SECURITY DEPOSIT...........................................11
         Z.       SUBLET.....................................................11
         AA.      SUBRENT....................................................12
         BB.      SUBTENANT..................................................12
         CC.      TENANT DELAY...............................................12
         DD.      TENANT IMPROVEMENTS........................................12
         EE.      TENANT'S BUILDING SHARE....................................13
         FF.      TENANT'S PERCENTAGE SHARE..................................13
         GG.      TENANT'S PERSONAL PROPERTY.................................13
         HH.      TERM.......................................................13

4.       LEASE TERM..........................................................13
         A.  TERM ...........................................................13
<PAGE>
         B.  DELAYS IN COMPLETION............................................14
         C.  OPTION TO EXTEND................................................15
                  (i)  GRANT OF OPTION.......................................15
                  (ii)  MANNER OF EXERCISE...................................15
                  (iii)  TERMS AND RENT......................................16
                  (iv)  DETERMINATION OF RENT................................16
                  (v)  LANDLORD'S INITIAL DETERMINATION......................17
                  (vi)  ARBITRATION..........................................17

5.       RENT AND ADDITIONAL CHARGES.........................................19
         A.  MONTHLY RENT....................................................19
         B.  ADJUSTMENTS TO MONTHLY RENT.....................................20
         C.  MANAGEMENT FEE..................................................20
         D.  COMMON AREA MAINTENANCE COSTS...................................20
                  (i)  ESTIMATED PAYMENTS....................................20
                  (ii)  ADJUSTMENT...........................................21
                  (iii)  LAST YEAR...........................................21
                  (iv)  AUDIT................................................22
         E.  ADDITIONAL RENT.................................................22
         F.  PRORATIONS......................................................23
         G.  INTEREST........................................................23

6.       LATE PAYMENT CHARGES................................................23

7.       SECURITY DEPOSIT....................................................23
         A.  DEPOSIT REQUIRED................................................23
                  (i)  REDUCTION OR REPLACEMENT..............................24
                  (ii)  CONSEQUENCES OF DEFAULT..............................25
                  (iii)  FORM OF L-C.........................................25

8.       HOLDING OVER........................................................26

9.       TENANT IMPROVEMENTS.................................................27

10.      CONDITION OF PREMISES...............................................27
         A.  CAPITAL IMPROVEMENTS............................................27
         B.  ACCEPTANCE OF PREMISES..........................................27
         C.  LANDLORD'S REPRESENTATIONS AND WARRANTIES.......................28
         D.  LANDLORD'S ADDITIONAL REPRESENTATION AND WARRANTY...............28

11.      USE OF THE PREMISES AND COMMON AREA.................................29
         A.       TENANT'S USE...............................................29
         B.       HAZARDOUS MATERIALS........................................29
                  (i) HAZARDOUS MATERIALS DEFINED............................29
                  (ii) ENVIRONMENTAL LAWS DEFINED............................30
                  (iii) USE OF HAZARDOUS MATERIALS...........................30
                  (iv) HAZARDOUS MATERIALS REPORT; WHEN REQUIRED.............31
<PAGE>
                  (v) HAZARDOUS MATERIALS REPORT; CONTENTS...................31
                  (vi)  RELEASE OF HAZARDOUS MATERIALS; NOTIFICATION AND
                           CLEANUP...........................................33
                  (vii)  INSPECTION AND TESTING BY LANDLORD..................34
                  (viii)  INDEMNITY..........................................35
                  (ix)  SURVIVAL.............................................36
         C.       SPECIAL PROVISIONS RELATING TO THE AMERICANS WITH
                  DISABILITIES ACT OF 1990...................................36
                  (i)      ALLOCATION OF RESPONSIBILITY TO LANDLORD..........36
                  (ii)  ALLOCATION OF RESPONSIBILITY TO TENANT...............36
                  (iii)  GENERAL.............................................37
         D.       USE AND MAINTENANCE OF COMMON AREA.........................37

12.      QUIET ENJOYMENT.....................................................37

13.      ALTERATIONS.........................................................38
         A.  ALTERATION RIGHTS...............................................38
         B.  PERFORMANCE OF ALTERATIONS......................................38

14.      SURRENDER OF THE PREMISES...........................................39

15.      IMPOSITIONS AND REAL PROPERTY TAXES.................................40
         A.       PAYMENT BY TENANT..........................................40
                  (i)      TAX PARCELS.......................................41
                  (ii)     PAYMENT...........................................42
         B.       TAXES ON TENANT IMPROVEMENTS AND PERSONAL PROPERTY.........42
         C.       PRORATION..................................................42

16.      UTILITIES AND SERVICES..............................................43

17.      REPAIR AND MAINTENANCE..............................................43
         A.       LANDLORD'S OBLIGATIONS.....................................43
         B.       TENANT'S OBLIGATIONS.......................................46
         C.       CONDITIONS APPLICABLE TO REPAIRS...........................46
         D.       LANDLORD'S RIGHTS..........................................47
         E.       COMPLIANCE WITH GOVERNMENTAL REGULATIONS...................47

18.      LIENS...............................................................48

19.      LANDLORD'S RIGHT TO ENTER THE PREMISES..............................48

20.      SIGNS...............................................................49

21.      INSURANCE...........................................................49
         A.       INDEMNIFICATION............................................49
         B.       TENANT'S INSURANCE.........................................51
         C.       BUILDING INSURANCE.........................................52
<PAGE>
         D.       INCREASED COVERAGE.........................................53
         E.       FAILURE TO MAINTAIN........................................53
         F.       INSURANCE REQUIREMENTS.....................................53
         G.       WAIVER AND RELEASE.........................................54

22.      WAIVER OF SUBROGATION...............................................54

23.      DAMAGE OR DESTRUCTION...............................................55
         A.       LANDLORD'S OBLIGATION TO REBUILD...........................55
         B.       RIGHT TO TERMINATE.........................................55
         C.       LIMITED OBLIGATION TO REPAIR...............................57
         D.       ABATEMENT OF RENT..........................................57
         E.       DAMAGE NEAR END OF TERM....................................57

24.      CONDEMNATION........................................................58

25.      ASSIGNMENT AND SUBLETTING...........................................59
         A.       LANDLORD'S CONSENT.........................................59
         B.       TENANT'S NOTICE............................................59
         C.       INFORMATION TO BE FURNISHED................................59
         D.       LANDLORD'S ALTERNATIVES....................................60
         E.       PRORATION..................................................60
         F.       PARAMETERS OF LANDLORD'S CONSENT...........................60
         G.       PERMITTED TRANSFERS........................................61

26.      DEFAULT.............................................................62
         A.       TENANT'S DEFAULT...........................................62
         B.       REMEDIES...................................................63
         C.       LANDLORD'S DEFAULT.........................................65

27.      SUBORDINATION.......................................................66
         A.       SUBORDINATION..............................................66
         B.       ATTORNMENT.................................................66
         C.       NON-DISTURBANCE............................................67

28.      NOTICES.............................................................67

29.      ATTORNEYS' FEES.....................................................68

30.      ESTOPPEL CERTIFICATES...............................................68
         A.  TENANT ESTOPPEL.................................................68
         B.  LANDLORD ESTOPPEL...............................................69

31.      TRANSFER OF THE PREMISES BY LANDLORD................................69

32.      LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS......................70
<PAGE>
33.      TENANT'S REMEDY.....................................................70

34.      MORTGAGEE PROTECTION................................................71

35.      BROKERS.............................................................71

36.      ACCEPTANCE..........................................................71

37.      PARKING.............................................................71

38.      GENERAL.............................................................72
         A.       CAPTIONS...................................................72
         B.       EXECUTED COPY..............................................72
         C.       TIME.......................................................72
         D.       SEPARABILITY...............................................72
         E.       CHOICE OF LAW..............................................72
         F.       GENDER; SINGULAR, PLURAL...................................72
         G.       BINDING EFFECT.............................................72
         H.       WAIVER.....................................................73
         I.       ENTIRE AGREEMENT...........................................73
         J.       AUTHORITY..................................................73
         K.       EXHIBITS...................................................73
         L.       LEASE SUMMARY..............................................73

39.      EQUIPMENT LEASING/LANDLORD'S LIEN...................................74

40.      RIGHT OF EARLY ENTRY................................................74
<PAGE>
                                      LEASE
                                      -----


         1.       PARTIES.

                  THIS LEASE (the  "LEASE"),  dated as of February 10,  1999, is
entered  into by and between  MARTIN/CAMPUS  ASSOCIATES  NO. 4, L.P., a Delaware
limited  partnership  ("LANDLORD"),  whose  address  is  100  Bush  Street,  San
Francisco,  California  94104,  and  BROADVISION,  INC., a Delaware  corporation
("TENANT"), whose address is 585 Broadway, Redwood City, California 94063.

         2.       PREMISES.

                  Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord  those certain  premises  consisting  of a total area of  approximately
Fifty-Five Thousand Two Hundred Eighty-Two (55,282) square feet, which comprises
all of the Rentable Area (as defined  below) of that certain  building  commonly
known as 405 Broadway (the  "BUILDING"),  in the City of Redwood City, County of
San Mateo,  State of California,  as more particularly shown on EXHIBITS A-1 AND
A-2 (the "PREMISES"). On or before the Commencement Date, Landlord shall measure
the Rentable Area of the Premises to the outside of all exterior  walls,  and to
the  middle of the  interior  demising  wall,  that form the  boundaries  of the
Premises, and Landlord and Tenant shall amend this Lease if necessary to reflect
any discrepancy in the size of the Premises disclosed by Landlord's  measurement
of the  Premises  by  Landlord's  architect.  The  Premises  also  includes  the
appurtenant right to use in common with other tenants of the Project (as defined
below) the Common Area (as defined below) of the Project owned by Landlord.

         3.       DEFINITIONS.

                  The following terms shall have the following  meanings in this
Lease:

                  A. AFFILIATE. Any Person that controls, or is controlled by or
is under common control with,  Landlord or Tenant.  No Person shall be deemed in
control of another  simply by virtue of being a  partner,  director,  officer or
holder of voting  securities of any Person.  For purposes of this PARAGRAPH 3.A,
"control"  shall  mean the  ownership  of,  and/or  the  right  to vote,  stock,
partnership interests, membership interests, or

                                        1
<PAGE>
other indicia of ownership possessing at least fifty-one percent (51%) of either
the total combined  interests in a Person, or the voting power of all classes of
a Person's capital stock, partnership interests,  membership interests, or other
indicia of ownership,  that have been issued,  outstanding,  and (if applicable)
are entitled to vote.

                  B.  ALTERATIONS.  Any  alterations,  additions or improvements
made in,  on or about  the  Premises  after the  substantial  completion  of the
Improvements, including, but not limited to, lighting, heating, ventilating, air
conditioning, electrical, partitioning, drapery and carpentry installations.

                  C. BUILDING.  The term  "Building"  shall have the meaning set
forth in PARAGRAPH 2.A above.

                  D. CAPITAL  IMPROVEMENTS.  Those certain  improvements  to the
Building to be constructed  by Landlord  pursuant to PARAGRAPH 10.A and the Work
Letter Agreement attached to this Lease as EXHIBIT B (the "WORK LETTER").

                  E. CC&RS.  Any  declaration  of conditions,  covenants  and/or
restrictions,  or similar instrument,  that now encumbers,  or may in the future
encumber the Project or the Premises,  as adopted by Landlord or its  successors
in interest from time to time, and any modifications or amendments thereto.

                  F.  COMMENCEMENT  DATE.  The  Commencement  Date of this Lease
shall be the first day of the Term determined in accordance with PARAGRAPH 4.A.

                  G. COMMON AREA.  All areas and  facilities  within the Project
not  appropriated to the exclusive  occupancy of tenants,  including the Parking
Area, the sidewalks,  pedestrian ways,  driveways,  signs, pools, ponds, service
delivery  facilities,  common storage areas,  common utility  facilities and all
other areas in the Project  established  by Landlord  and/or its  successors for
non-exclusive use. Landlord may, by written notice to Tenant,  elect in its sole
discretion to increase  and/or decrease the Common Area from time to time during
the Term for any reason whatsoever  (including without limitation an election by
Landlord  and/or its successors in their sole  discretion to make changes to the
buildings situated in the Project, and/or to subdivide,  sell, exchange, dispose
of,  transfer,  or change the  configuration of all or any portion of the Common
Area from time

                                        2
<PAGE>
to time), so long as Landlord neither unreasonably interferes with ingress to or
egress from the Building, nor reduces the number of parking spaces available for
Tenant's  use below the minimum  requirements  set forth in  PARAGRAPH  37 for a
period  of sixty  (60)  consecutive  days or more.  No such  subdivision,  sale,
exchange,  disposition,  transfer,  or change to the configuration of all or any
portion  of the Common  Area shall  cause the  Common  Area to be  increased  or
decreased  unless and until  Landlord  has given Tenant  written  notice of such
increase  or  decrease.  However,  Landlord  shall make no changes  which have a
material  adverse  effect upon Tenant's use and enjoyment of the Premises or the
accessibility of parking thereto.

                  H. COMMON AREA  MAINTENANCE  COSTS. The total of all costs and
expenses  paid or  incurred  by  Landlord  in  connection  with  the  operation,
maintenance,  ownership and repair of the Common Area,  and the  performance  of
Landlord's  obligations  under  PARAGRAPHS  17.A, and the exercise of Landlord's
rights under PARAGRAPH 17.D.  Without  limiting the generality of the foregoing,
Common  Area  Maintenance  Costs  include  all  costs of and  expense  for:  (i)
maintenance  and  repairs  of the  Common  Area;  (ii)  resurfacing,  resealing,
remarking, painting, repainting,  striping or restriping the Parking Area; (iii)
maintenance  and repair of all public or common  facilities;  (iv)  maintenance,
repair and  replacement of sidewalks,  curbs,  paving,  walkways,  Parking Area,
Project signs,  landscaping,  planting and irrigation systems, trash facilities,
loading and delivery areas,  lighting,  drainage and common utility  facilities,
directional or other signs, markers and bumpers, and any fixtures, equipment and
personal  property  located on the Common Area; (v) wages,  salaries,  benefits,
payroll  burden fees and  charges of  personnel  employed  by  Landlord  and the
charges of all independent  contractors retained by Landlord (to the extent that
such personnel and  contractors  are utilized by Landlord) for the  maintenance,
repair,  management  and/or  supervision  of the  Project,  and of any  security
personnel  retained by Landlord in connection with the operation and maintenance
of the Common Area (although  Landlord shall not be required to obtain  security
services);  (vi)  maintenance,  repair and  replacement of security  systems and
alarms installed by Landlord (if any); (vii) depreciation or amortization (or in
lieu thereof, rental payments) on all tools, equipment and machinery used in the
operation and maintenance of the Common Area;  (viii) premiums for Comprehensive
General Liability Insurance or Commercial General Liability Insurance,  casualty
insurance, workers' compensation

                                        3
<PAGE>
insurance  or other  insurance  on the Common  Area,  or any portion  thereof or
interest  therein,  and any  deductibles  payable with respect to such insurance
policies;  (ix) all personal  property or real  property  taxes and  assessments
levied or assessed on the Project,  or any portion thereof or interest  therein,
including  without  limitation  the Real  Property  Taxes  for the  Project,  if
applicable under PARAGRAPH 15.A; (x) cleaning,  collection,  storage and removal
of trash,  rubbish,  dirt and debris, and sweeping and cleaning the Common Area;
(xi)  legal,  accounting  and  other  professional  services  for  the  Project,
including  costs,  fees and expenses of contesting the validity or applicability
of any law, ordinance,  rule, regulation or order relating to the Building,  and
of  contesting,  appealing or otherwise  attempting  to reduce any Real Property
Taxes  assessed  against  the  Project;  (xii)  any  alterations,  additions  or
improvements  required to be made to the Common  Area in order to reduce  Common
Area  Maintenance  Costs or to protect the health or safety of  occupants of the
Project,  but only to the extent of any actual  cost  savings  realized  thereby
(provided that if the cost of any such  alterations,  additions or  improvements
during any year  exceeds the amount of cost  savings  realized  thereby for that
year,  Landlord may in its sole discretion  elect to include such excess amounts
in Common Area Maintenance  Costs for the following year, but only to the extent
of any  actual  cost  savings  realized  during  such  year  by  reason  of such
alterations,  additions  or  improvements);  (xiii)  all costs and  expenses  of
providing,   creating,   maintaining,   repairing,   managing,   operating,  and
supervising  an  amenity  center  for the  Project,  which may  include  without
limitation a dining  facility  (provided,  however,  that Landlord  shall not be
required to provide or create such an amenity center),  which costs and expenses
may include  without  limitation rent charged by Landlord for the space occupied
by such amenity  center;  (xiv) all costs and  expenses  incurred by Landlord in
performing its obligations  under PARAGRAPHS 17.A or exercising its rights under
PARAGRAPH 17.D,  including without limitation all costs and expenses incurred in
performing any alterations, additions or improvements required to be made to the
Building in order to comply with applicable laws, ordinances, rules, regulations
and orders (to the extent that such laws,  ordinances,  rules,  regulations  and
orders are either enacted after, or become  applicable to the Building due to an
amendment thereto that becomes  effective after, the Commencement  Date) and all
capital  improvements  required  to  made  in  connection  with  the  operation,
maintenance  and  repair  of the  Building,  provided  that the cost of any such
alterations, additions, improvements or

                                        4
<PAGE>
capital  improvements,  together  with interest at the Interest  Rate,  shall be
amortized  over the useful  life of the  alteration,  addition,  improvement  or
capital  improvement in question and included in Common Area  Maintenance  Costs
for each year over which such costs are  amortized;  (xv) all costs and expenses
incurred in performing any alterations, additions or improvements required to be
made to the Common Area in order to comply  with  applicable  laws,  ordinances,
rules,  regulations and orders and all capital improvements  required to made in
connection  with the  operation,  maintenance  and  repair of the  Common  Area,
provided  that the  cost of any such  alterations,  additions,  improvements  or
capital  improvements,  together  with interest at the Interest  Rate,  shall be
amortized  over the useful  life of the  alteration,  addition,  improvement  or
capital  improvement in question and included in Common Area  Maintenance  Costs
for each  year  over  which  such  costs  are  amortized;  and (xvi) any and all
payments  due and owing on behalf of the  Project or any  portion  thereof  with
respect to any CC&Rs,  including without  limitation any and all assessments and
association  dues.  However,  notwithstanding  the  foregoing or anything to the
contrary in this Lease, Common Area Maintenance Costs shall not include the cost
of or expenses for the following:  (A) leasing  commissions,  attorneys' fees or
other costs or expenses  incurred in connection  with  negotiations  or disputes
with other tenants of the Project; (B) depreciation of buildings in the Project;
(C) payments of principal, interest, late fees, prepayment fees or other charges
on any debt secured by a mortgage covering the Project, or rental payments under
any  ground  lease  or  underlying  lease;  (D) any  penalties  incurred  due to
Landlord's  violation of any  governmental  rule or authority (but not excluding
the cost of compliance therewith,  if such cost is chargeable to Tenant pursuant
to this  Lease);  (E) any Real  Property  Taxes or costs for which  Landlord  is
separately and directly  reimbursed by Tenant or any other tenant of the Project
which are assessed  against the  Premises or the  premises  leased by such other
tenant(s);  (F) items for which  Landlord is reimbursed  by  insurance;  (G) all
costs  associated  with  the  operation  of the  business  of the  entity  which
constitutes "Landlord" (as distinguished from the costs of operations, the costs
described in clause (v) of this PARAGRAPH  3.H, and the property  management fee
described  in  PARAGRAPH  5.C below),  including,  but not limited to,  costs of
partnership  accounting and legal matters,  costs of defending any lawsuits with
any  mortgagee  (except as the  actions  of Tenant  may be in  issue),  costs of
selling,  syndicating,  financing,  mortgaging,  or  hypothecating  any  of  the
Landlord's interest in the Project and/or Common Area, or any portion

                                        5
<PAGE>
thereof,  costs of any disputes  between  Landlord and its  employees,  costs of
disputes of Landlord with Building  management or costs paid in connection  with
disputes  with Tenant or any other  tenants;  (H) all costs  (including  permit,
license and inspection  fees)  incurred in renovating or otherwise  improving or
decorating, painting or redecorating space for other tenants in the Project; (I)
the creation of any reserves for equipment or capital  replacement  (but not the
expenditure  of any  funds  from such  reserves);  (J) all  costs  arising  from
monitoring,  cleaning up and  otherwise  remediating  any  release of  Hazardous
Materials at the Premises to the extent that either (1) Landlord  (who shall use
reasonable  efforts to obtain  reimbursement)  is actually  reimbursed  by third
parties for such costs (but not the costs of  collection  incurred by  Landlord,
unless such costs of collection are also  reimbursed by third  parties),  or (2)
such release of Hazardous  Materials occurred prior to the Commencement Date and
did not  arise  from  Tenant's  early  occupancy  of the  Premises  pursuant  to
PARAGRAPH  40 below;  (K) all costs and  expenses  incurred  in  performing  any
alterations,  additions or  improvements  required to be made to the Building in
order to comply with applicable laws, ordinances, rules, regulations and orders,
to the extent  that such laws,  ordinances,  rules,  regulations  and orders are
enacted  before the  Commencement  Date (unless any such law,  ordinance,  rule,
regulation or order becomes  applicable to the Building due to an amendment that
becomes  effective  after the  Commencement  Date, in which event such costs and
expenses  shall be includable  in Common Area  Maintenance  Costs);  and (L) all
costs and expenses incurred in removing  asbestos-containing  materials from, or
encapsulating asbestos-containing materials within, the Premises.

                  Notwithstanding  anything to the contrary in the definition of
Common Area Maintenance  Costs set forth in this Lease,  Common Area Maintenance
Costs shall not include the following:

                           1. any depreciation on the Building and Project;

                           2.  interest,  principal,  points and fees on debt or
amortization  on any  mortgages  and  deeds of trust or other  debt  instruments
secured by the Building or the Project or any underlying ground lease;

                                        6
<PAGE>
                           3. costs of repairs and general maintenance paid from
insurance proceeds but excluding the amount of any deductibles paid by Landlord;

                           4. repairs and replacements  covered by warranties or
guaranties (to the extent actually collected by Landlord);

                           5. costs of special  services  rendered to individual
tenants (including Tenant) for which a special charge is made;

                           6.  costs of  improvements  for other  tenants in the
Building or Project;

                           7.  costs  of the  Landlord  for  which a  tenant  is
obligated  to reimburse  Landlord,  including,  for example,  taxes and property
insurance  premiums on improvements for tenants of the Building and Project that
are above the building standard;

                           8. costs  incurred by Landlord due to  violations  of
any of the terms and  conditions of any lease in the Building or Project  (other
than this Lease);

                           9.  Marketing  costs  including  without  limitation,
leasing  commissions,  attorneys' fees, space planning costs and other costs and
expenses incurred in connection with the leasing of the Building; and

                           10.  Overhead and profit  increment  paid to Landlord
and Landlord's  subsidiaries  for goods and/or services in or to the Building or
Project to the extent the same exceeds the costs of such goods  and/or  services
rendered by unaffiliated third parties on a competitive basis.

                  I. EXISTING  BUILDINGS.  Those  buildings  currently  situated
within the  Project  and  commonly  known as 405  Broadway,  425  Broadway,  475
Broadway, 555 Broadway, and 575-585 Broadway,  provided, however, that if at any
time Landlord sells, exchanges, disposes of, or otherwise transfers its interest
in any such  building,  then  effective  upon the date of such  sale,  exchange,
disposition,  or other  transfer,  the  building  shall  cease to be an Existing
Building for the purposes of this Lease;  and provided  further,  that if at any
time Landlord demolishes any Existing Building,  neither the demolished building
nor any new  building  constructed  on or about the  location of the  demolished
building

                                        7
<PAGE>
(even if such new  building  uses the same address as the  demolished  building)
shall be considered to be an Existing Building for the purposes of this Lease.

                  J. EXISTING  PROJECT  SPACE.  All Rentable Area located within
the Existing Buildings.

                  K. FINAL PLANS. As defined in the Work Letter.

                  L. HVAC. Heating, ventilating and air conditioning.

                  M.  IMPOSITIONS.  Taxes,  assessments,  charges,  excises  and
levies,  business taxes,  license,  permit,  inspection and other  authorization
fees,  transit  development  fees,  assessments  or charges for  housing  funds,
service  payments  in lieu of taxes and any other fees or charges of any kind at
any time levied,  assessed,  charged or imposed by any  federal,  state or local
entity, (i) upon, measured by or reasonably attributable to the cost or value of
Tenant's  equipment,  furniture,  fixtures or other personal property located in
the Premises,  or the cost or value of any  Alterations;  (ii) upon, or measured
by, any Rent payable  hereunder,  including any gross  receipts tax; (iii) upon,
with respect to or by reason of the development, possession, leasing, operation,
management,  maintenance,  alteration, repair, use or occupancy by Tenant of the
Premises,  or any portion thereof;  or (iv) upon this Lease transaction,  or any
document to which  Tenant is a party  creating or  transferring  any interest or
estate  in  the  Premises.  Impositions  do  not  include  franchise,  transfer,
inheritance  or capital stock taxes,  or income taxes measured by the net income
of Landlord from all sources,  except to the extent any such taxes are levied or
assessed  against  Landlord as a substitute  for, in whole or in part,  any item
that  would  otherwise  be  deemed  an  Imposition  under  this  PARAGRAPH  3.M.
Impositions  also  do not  include  any  increases  in the  taxes,  assessments,
charges,  excises  and levies  assessed  against  the  Project due solely to the
construction  or installation  of tenant  improvements  or other  alterations by
tenants of the Project  other than Tenant and any other  tenants or occupants of
the  Building;  provided,  however,  that  if any  Impositions  are  imposed  or
increased due to the  construction  or  installation  of tenant  improvements or
other alterations in the Building,  such Impositions shall be equitably prorated
in Landlord's  reasonable  judgment  between Tenant and any other tenants of the
Building.

                                        8
<PAGE>
                  N. IMPROVEMENTS. Collectively, the Tenant Improvements and the
Capital Improvements.

                  O. INTEREST RATE. Either (i) the greater of (a) eleven percent
(11%) per  annum,  or (b) the  reference  rate,  or  succeeding  similar  index,
announced from time to time by the Bank of America's main San Francisco  office,
plus two percent (2%) per annum; or (ii) the maximum rate of interest  permitted
by law, whichever is less.

                  P. LANDLORD'S AGENTS.  Landlord's authorized agents, partners,
subsidiaries, directors, officers, and employees.

                  Q. MONTHLY RENT.  The rent payable  pursuant to PARAGRAPHS 4.D
AND 5.A., as adjusted from time to time pursuant to the terms of this Lease.

                  R. PARKING AREA. All Common Area (except sidewalks and service
delivery  facilities) now or hereafter designated by Landlord for the parking or
access of motor vehicles,  including  roads,  traffic lanes,  vehicular  parking
spaces,  landscaped  areas and walkways,  and  including  any parking  structure
constructed  during the Term.  Landlord  and/or its  successors  may, by written
notice to Tenant, elect in their sole discretion to increase and/or decrease the
Parking  Area  from  time to time  during  the  Term for any  reason  whatsoever
(including  without  limitation an election by Landlord and/or its successors in
their sole discretion to make changes to the buildings  situated in the Project,
and/or to  subdivide,  sell,  exchange,  dispose  of,  transfer,  or change  the
configuration  of all or any portion of the Parking Area from time to time),  so
long as such  changes  to the  Parking  Area do not reduce the number of parking
spaces  available for Tenant's use below the minimum  requirements  set forth in
PARAGRAPH  37 for a  period  of sixty  (60)  consecutive  days or more.  No such
subdivision,   sale,  exchange,   disposition,   transfer,   or  change  to  the
configuration  of all or any portion of the Parking Area shall cause the Parking
Area to be  increased or  decreased  unless and until  Landlord has given Tenant
written notice of such increase or decrease.

                  S. PERSON.  Any individual,  partnership,  firm,  association,
corporation,  limited  liability  company,  trust,  or other form of business or
legal entity.

                                        9
<PAGE>
                  T. PREMISES.  The term  "Premises"  shall have the meaning set
forth in PARAGRAPH 2 above.

                  U.  PROJECT.  That certain real  property  shown on EXHIBIT C,
upon which are  currently  located the  Building  and four (4) other  buildings,
currently  consisting of a total building square footage of  approximately  Four
Hundred Eleven Thousand Three Hundred Five and 00/100  (411,305)  square feet of
Rentable Area.  Landlord and/or its successors may, by written notice to Tenant,
elect in their  sole  discretion  to  increase  and/or  decrease  the  number of
buildings  and/or the amount of Rentable  Area situated in the Project from time
to time during the Term for any reason whatsoever.

                  V. REAL PROPERTY TAXES. Taxes,  assessments and charges now or
hereafter  levied or assessed  upon,  or with  respect to, the  Project,  or any
personal  property of Landlord used in the operation thereof or located therein,
or Landlord's interest in the Project or such personal property, by any federal,
state or local entity,  including:  (i) all real property  taxes and general and
special assessments; (ii) charges, fees or assessments for transit, housing, day
care, open space, art, police,  fire or other governmental  services or benefits
to the Project,  including assessments,  taxes, fees, levies and charges imposed
by governmental  agencies for such purposes as street,  sidewalk,  road, utility
construction  and  maintenance,   refuse  removal  and  for  other  governmental
services;  (iii) service payments in lieu of taxes;  (iv) any tax, fee or excise
on the use or occupancy of any part of the Project,  or on rent for space in the
Project; (v) any other tax, fee or excise, however described, that may be levied
or assessed as a substitute  for, or as an addition to, in whole or in part, any
other Real Property Taxes; and (vi) reasonable  consultants' and attorneys' fees
and expenses  incurred in connection with  proceedings to contest,  determine or
reduce Real Property Taxes.  Real Property Taxes do not include:  (A) franchise,
transfer,  inheritance  or capital stock taxes,  or income taxes measured by the
net income of  Landlord  from all  sources,  unless any such taxes are levied or
assessed  against  Landlord as a substitute  for, in whole or in part,  any Real
Property Tax; (B)  Impositions and all similar amounts payable by tenants of the
Project under their leases;  and (C) penalties,  fines,  interest or charges due
for late payment of Real Property Taxes by Landlord.  If any Real Property Taxes
are payable, or may at the option of the taxpayer be paid, in installments, such
Real Property Taxes shall, together with any interest that would

                                       10
<PAGE>
otherwise  be  payable  with  such  installment,  be deemed to have been paid in
installments,  amortized over the maximum time period allowed by applicable law.
If the tax  statement  from a taxing  authority  does not allocate Real Property
Taxes to the  Building,  Landlord  shall  make the  determination  of the proper
allocation  of such Real  Property  Taxes based,  to the extent  possible,  upon
records of the taxing  authority and, if not so available,  then on an equitable
basis.  Real  Property  Taxes also do not  include any  increases  in the taxes,
assessments, charges, excises and levies assessed against the Project due solely
to the construction or installation of tenant  improvements or other alterations
by tenants of the Project  other than Tenant and any other  tenants or occupants
of the Building;  provided, however, that if any Real Property Taxes are imposed
or increased due to the  construction or installation of tenant  improvements or
other  alterations in the Building,  such Real Property Taxes shall be equitably
prorated in Landlord's  reasonable judgment between Tenant and any other tenants
of the Building.

                  W. RENT.  Monthly Rent plus the Additional  Rent as defined in
PARAGRAPH 5.E.

                  X. RENTABLE AREA.  The aggregate  square footage in any one or
more  buildings in the Project,  as  appropriate,  as  reasonably  determined by
Landlord's architect from time to time.

                  Y. SECURITY  DEPOSIT.  That amount paid by Tenant  pursuant to
PARAGRAPH 7.

                  Z.  SUBLET.  Any  transfer,  sublet,  assignment,  license  or
concession  agreement,  change of ownership,  mortgage, or hypothecation of this
Lease or the Tenant's interest in the Lease or in and to all or a portion of the
Premises.  As used herein,  a Sublet includes the following:  (i) if Tenant is a
partnership  or  a  limited  liability   company,   a  transfer,   voluntary  or
involuntary,  of all or any part of any interest in such  partnership or limited
liability  company,  or the dissolution of the partnership or limited  liability
company, whether voluntary or involuntary;  (ii) if Tenant is a corporation, any
dissolution,  merger,  consolidation or other  reorganization  of Tenant, or the
transfer,  either by a single  transaction or in a series of transactions,  of a
controlling  percentage  of the stock of Tenant  (except that a Sublet shall not
include any such  transfer of a  controlling  percentage  of the stock of Tenant
occurring at a time when the stock of Tenant is publicly traded on a nationally

                                       11
<PAGE>
recognized  stock  exchange  or over  the  counter),  or the  sale,  by a single
transaction  of or series of  transaction,  within any one (1) year  period,  of
corporate  assets equaling or exceeding  twenty percent (20%) of the total value
of Tenant's  assets (except in connection with an initial public offering of the
stock of Tenant on a nationally  recognized stock exchange or over the counter);
(iii) if Tenant is a trust, the transfer,  voluntarily or involuntarily,  of all
or any part of the controlling interest in such trust; and (iv) if Tenant is any
other form of entity, a transfer,  voluntary or involuntary,  of all or any part
of any  interest  in such  entity.  As used  herein,  the  phrases  "controlling
percentage" and "controlling  interest" means the ownership of, and/or the right
to vote, stock, partnership interests, membership interests, or other indicia of
ownership  possessing  at least  fifty-one  percent  (51%) of  either  the total
combined  interests  in Tenant,  or the voting  power of all classes of Tenant's
capital stock, partnership interests,  membership interests, or other indicia of
ownership, that have been issued, outstanding,  and (if applicable) are entitled
to vote.

                  AA. SUBRENT. Any consideration of any kind received,  or to be
received,  by Tenant  from a  subtenant  if such sums are  related  to  Tenant's
interest in this Lease or in the Premises.

                  BB.  SUBTENANT.  The  person  or  entity  with  whom a  Sublet
agreement is proposed to be or is made.

                  CC. TENANT DELAY. Any delay that Landlord may encounter in the
performance  of  Landlord's  obligations  under the Lease  because of any act or
omission of any nature by Tenant or its agents or contractors, including without
limitation any (i) delay attributable to the postponement of any Improvements at
the request of Tenant;  (ii) delay by Tenant in the submission of information or
the giving of  authorizations  or approvals  within the time limits set forth in
the Lease or the Work Letter;  (iii) delay attributable to the failure of Tenant
to pay,  when due,  any amounts  required  to be paid by Tenant  pursuant to the
Lease or the Work Letter; and (iv) delay resulting from any change order request
initiated or requested by Tenant.

                  DD. TENANT  IMPROVEMENTS.  Those certain  improvements  to the
Premises to be  constructed  by  Landlord  pursuant to EXHIBIT B, other than the
Capital Improvements. The Tenant Improvements shall at all times be the property
of Landlord and shall not be deemed Tenant's Personal Property.

                                       12
<PAGE>
                  EE.  TENANT'S  BUILDING  SHARE.  The  ratio  (expressed  as  a
percentage)  of the total  Rentable  Area of the Premises to the total  Rentable
Area of the Building as determined  by Landlord  from time to time,  which as of
the Commencement Date shall equal one hundred percent (100%).  Tenant's Building
Share shall be recalculated  any time that the amount of Rentable Area contained
in Premises is adjusted,  or there is a change in the total Rentable Area of the
Building.

                  FF.  TENANT'S  PERCENTAGE  SHARE.  The ratio  (expressed  as a
percentage)  of the total  Rentable  Area of the Premises to the total  Rentable
Area of all of the buildings at the Project owned by Landlord from time to time,
which as of the  Commencement  Date shall equal  Thirteen and 44/100ths  percent
(13.44%) (i.e.,  the Rentable Area of the Premises  divided by the Rentable Area
of the buildings at the Project owned by Landlord as of the date of this Lease).
Tenant's  Percentage  Share  shall be  recalculated  any time that the amount of
Rentable  Area  contained in Premises is  adjusted,  or there is a change in the
total  Rentable  Area of those  buildings in the Project  owned by Landlord,  or
Landlord sells,  exchanges,  or otherwise  transfers any or all of the buildings
situated in the Project (including without limitation the Building). The parties
acknowledge  and agree that the total  Rentable  Area of all of the buildings in
the Project  owned by Landlord may increase  and/or  decrease  from time to time
during  the Term,  since  Landlord  may elect in its sole  discretion  to sell a
building  or  buildings  or to  make  changes  to the  buildings  it owns in the
Project.

                  GG.  TENANT'S  PERSONAL  PROPERTY.  Tenant's  trade  fixtures,
furniture, equipment and other personal property in the Premises.

                  HH. TERM. The Term of this Lease set forth in PARAGRAPH  4.A.,
as it may be  extended  hereunder  pursuant  to any  options  to extend  granted
herein.

         4.       LEASE TERM.

                  A. TERM. The Term shall commence on the date that Landlord has
substantially  completed the Improvements (the  "COMMENCEMENT  DATE"), and shall
terminate  December 4, 2007.  For the purposes of this Lease,  Landlord shall be
deemed to have substantially completed the Improvements at such time as the

                                       13
<PAGE>
building  inspector  and fire  marshall for the City of Redwood City has granted
temporary occupancy of the Improvements.

                  B. DELAYS IN COMPLETION.  Landlord shall diligently  prosecute
the completion of the  Improvements in accordance with the schedule  attached to
EXHIBIT B-3.  Tenant  agrees that if  Landlord,  for any reason  whatsoever,  is
unable to  substantially  complete the  Improvements  on or before the Estimated
Commencement Date (as defined below), Landlord shall not be liable to Tenant for
any loss or damage therefrom, nor shall this Lease be void or voidable. Landlord
and Tenant  estimate  that the  Commencement  Date shall be August 26, 1999 (the
"ESTIMATED   COMMENCEMENT   DATE").   Upon  the   establishment  of  the  actual
Commencement  Date,  Landlord  and  Tenant  shall  execute a  Commencement  Date
Memorandum in the form set forth in EXHIBIT D. No delay in Landlord's completion
of the  Improvements  caused by any Tenant Delay shall delay the commencement of
Monthly Rent or the commencement of the Term hereunder.  In the event of a delay
caused  by any  Tenant  Delay,  Landlord  shall set the  "Commencement  Date" by
written  notice  to  Tenant  as  the  date  the  Improvements  would  have  been
substantially completed without such delay as reasonably determined by Landlord.
Landlord shall then subsequently deliver the Premises to Tenant upon substantial
completion  as  hereinabove  defined.  Such  right  of  Landlord  to  reset  the
Commencement  Date shall not be permitted if the delay in Landlord's  completion
of the  Improvements  is due to any delay  caused by  Landlord or by the City of
Redwood City provided  that Tenant has timely  submitted its plans in accordance
with the schedule  attached to EXHIBIT  B-3.  Tenant shall pay any and all costs
and expenses incurred by Landlord which result from any Tenant Delay, including,
without limitation,  any and all costs and expenses attributable to increases in
the cost of labor or materials.  Notwithstanding  the foregoing,  if Landlord is
delayed  in the  performance  of the  Improvements  because of acts of any other
party,  actions of the elements,  acts of nature, war, riot, strikes,  lockouts,
labor disputes,  inability to procure or general  shortage of labor or materials
in the normal  channels of trade,  or delay in  governmental  action or inaction
where  action is  required  (collectively,  "Force  Majuere  Delays"),  then the
Commencement  Date shall be extended by the period of the delay,  and the period
for Landlord's  performance of the  Improvements  shall be extended for a period
equivalent to the period of such delay. Notwithstanding anything to the contrary
contained herein,  if (i) Landlord has not delivered the Premises  substantially
completed to Tenant on or before the date that is sixty (60) days after the

                                       14
<PAGE>
Estimated  Commencement  Date for any reason  other than  Tenant  Delay or Force
Majeure  Delays,  or (ii) Landlord has not delivered the Premises  substantially
completed  to Tenant on or before  the date that is ninety  (90) days  after the
Estimated  Commencement Date for any reason,  including but not limited to Force
Majeure Delays,  then in either such event Tenant shall have the right to cancel
this  Lease,  and  upon  such  cancellation,  Landlord  shall  return  all  sums
theretofore deposited by Tenant with Landlord,  and neither party shall have any
further liability to the other; provided,  however, in the event of cancellation
pursuant  to clause  (ii)  above,  Landlord  shall not be  required to return to
Tenant  the  expended  portion  of the Set Aside  Funds as defined in EXHIBIT B.
Tenant shall exercise its cancellation right within fifteen (15) days after such
sixty (60) or ninety (90) day period as applicable.

                  C.  OPTION TO EXTEND.

                           (i) GRANT OF OPTION. Landlord hereby grants to Tenant
one (1)  option  ("OPTION  TO  EXTEND")  to extend the Term of this Lease for an
additional  term of five (5) years.  The  five-year  option term (the  "EXTENDED
TERM") shall  commence upon the  expiration  of the initial Term.  The Option to
Extend is expressly  conditioned  upon  Tenant's not being in default  under any
term or condition of this Lease after notice from Landlord and the expiration of
any applicable cure period granted by this Lease,  either at the time the Option
to Extend is  exercised  or at the time the Extended  Term would  commence.  The
Option to Extend shall be personal to the Tenant originally named in this Lease,
and shall not be assigned,  sold, conveyed or otherwise transferred to any other
party,  except to an  Affiliate or a Permitted  Transferee  in  accordance  with
PARAGRAPH 25.G below (including  without limitation any assignee or sublessee of
such Tenant) without the prior written consent of Landlord, which consent may be
withheld  in  Landlord's  sole  discretion.   The  Option  to  Extend  shall  be
exercisable only so long as the Lease remains in full force and effect and shall
be an interest  appurtenant to and not separable from Tenant's  estate under the
Lease. Under no circumstances  shall Landlord be required to pay any real estate
commission  to any party with  respect  to  Tenant's  exercise  of the Option to
Extend.

                           (ii)  MANNER OF  EXERCISE.  Tenant may  exercise  the
Option to Extend only by giving  Landlord  written  notice not less than one (1)
year prior to the expiration of the Term. If Tenant fails to exercise the Option
to Extend, then the Option to Extend

                                       15
<PAGE>
automatically  shall lapse and thereafter Tenant shall have no right to exercise
the Option to Extend.

                           (iii) TERMS AND RENT.  The initial  Monthly  Rent for
the  Premises  for the  Extended  Term shall be equal to the  greater of (x) one
hundred  percent  (100%) of the fair market rent, as determined  below,  for the
Premises as of the  commencement of the Extended Term, or (x) an amount equal to
the Monthly Rent  payable  during the last year of the Term,  multiplied  by one
hundred three and one fourth percent  (103.25%).  All other terms and conditions
of the Lease, as amended from time to time by the parties in accordance with the
provisions  of the Lease,  shall remain in full force and effect and shall apply
during the Extended Term; provided,  however,  that neither the Option to Extend
nor Landlord's obligations under the Work Letter shall be of any force or effect
during the Extended Term.

                           (iv)  DETERMINATION  OF  RENT.  For the  purposes  of
calculating  the Monthly Rent for the Extended  Term, the fair market rent shall
be equal to the net  effective  rent per rentable  square foot being charged for
leases executed within the preceding  twelve (12) months for comparable space at
either the  Project  (if any),  or if there are none,  for  comparable  space in
office and research and development complexes located in the Redwood Shores area
or the Menlo Oaks Business Park (located in Menlo Park, California),  with terms
comparable  to the terms  contained  in this Lease,  taking  into  consideration
relevant  factors  such  as  the  presence  or  absence  of  tenant  improvement
contributions by the lessor (but excluding the value of any tenant  improvements
paid for by Tenant), and incorporating increases in the Rent during the Extended
Term, if appropriate. Any value added to the Premises by the Tenant Improvements
and any  Alterations  paid for by Tenant shall not be  considered or included in
the  determination  of the fair  market  rent.  The fair  market  rent  shall be
determined  by mutual  agreement of the parties or, if the parties are unable to
agree  within  forty-five  (45) days after  Tenant's  exercise  of the Option to
Extend,  then fair market rent shall be determined pursuant to the procedure set
forth in PARAGRAPHS 4.C.(V) and 4.C.(VI).  The determination of the Monthly Rent
for the Extended Term for the Premises shall take into account the fact that the
Premises  shall be  leased  in its  shell  condition  with a tenant  improvement
allowance of Ten and 00/100 Dollars ($10.00)per square foot.

                                       16
<PAGE>
                           (v) LANDLORD'S INITIAL DETERMINATION.  If the parties
are unable  mutually to agree upon the fair market  rent  pursuant to  PARAGRAPH
4.C.(IV), then the fair market rent initially shall be determined by Landlord by
written  notice  ("LANDLORD'S  NOTICE") given to Tenant  promptly  following the
expiration  of the 45-day  period  set forth in  PARAGRAPH  4.C.(IV).  If Tenant
disputes the amount of fair market rent set forth in  Landlord's  Notice,  then,
within thirty (30) days after the date of Landlord's  Notice,  Tenant shall send
Landlord a written notice  ("TENANT'S  NOTICE") which  specifically (a) disputes
the fair market rent set forth in  Landlord's  Notice,  (b) demands  arbitration
pursuant  to  PARAGRAPH  4.C.(VI),  and (c) states  the name and  address of the
person who shall act as arbitrator on Tenant's behalf.  Tenant's Notice shall be
deemed defective, and not given to Landlord, if it fails to substantially comply
with the requirements or fails to strictly comply with the time period set forth
above. If Tenant does not send Tenant's Notice within thirty (30) days after the
date of  Landlord's  Notice,  or if Tenant's  Notice fails to contain all of the
required  information,  then Tenant shall be deemed to have rejected  Landlord's
Notice.  If Tenant is deemed to have rejected  Landlord's  Notice,  and Landlord
thereafter gives Tenant a written notice  ("LANDLORD'S SECOND NOTICE") demanding
that Tenant  respond to  Landlord's  Notice,  and Tenant does not send  Tenant's
Notice within five (5) days of the date of Landlord's  Second  Notice,  then the
Monthly Rent for the Extended Term shall equal one hundred percent (100%) of the
fair market rent specified in Landlord's Notice. If Tenant sends Tenant's Notice
in the proper form within thirty (30) days after the date of Landlord's  Notice,
then the Monthly Rent for the Extended Term shall be  determined by  arbitration
pursuant to PARAGRAPH  4.C(VI) below.  If the arbitration is not concluded prior
to the  commencement  of the Extended  Term,  then Tenant shall pay Monthly Rent
equal to one hundred  twenty-five  percent  (125%) of the Monthly  Rent  payable
immediately  prior to the  commencement of the Extended Term. If the fair market
rent  determined  by  arbitration  differs from that paid by Tenant  pending the
results  of  arbitration,  then any  adjustment  required  to adjust  the amount
previously  paid shall be made by payment by the  appropriate  party  within ten
(10) days after the determination of fair market rent.

                           (vi) ARBITRATION.  The arbitration shall be conducted
in the City of San Francisco in accordance with the then prevailing rules of the
American  Arbitration  Association  (or its  successor)  for the  arbitration of
commercial disputes, except

                                       17
<PAGE>
that the procedures mandated by such rules shall be modified as follows:

                                    (a) Each  arbitrator  must be a real  estate
appraiser  with at  least  five  (5)  years of  full-time  commercial  appraisal
experience  who is familiar with the fair market rent of office and research and
development  complexes located in the vicinity of the Premises.  Within ten (10)
business days after receipt of Tenant's Notice,  Landlord shall notify Tenant of
the name and address of the person  designated  by Landlord to act as arbitrator
on Landlord's behalf.

                                    (b) The two  arbitrators  chosen pursuant to
PARAGRAPH  4.C.(VI)(A) shall meet within ten (10) business days after the second
arbitrator  is  appointed  and shall  either  agree upon the fair market rent or
appoint a third arbitrator  possessing the qualifications set forth in PARAGRAPH
4.C.(VI)(A).  If the two arbitrators agree upon the fair market rent within such
ten (10) business day period, the Monthly Rent for the Extended Term shall equal
one hundred  percent (100%) of such fair market rent. If the two arbitrators are
unable to agree upon the fair market rent and are unable to agree upon the third
arbitrator  within five (5) business days after the  expiration of such ten (10)
business  day  period,  the third  arbitrator  shall be  selected by the parties
themselves.  If the parties do not agree on the third arbitrator within five (5)
business days after the  expiration  of such five (5) business day period,  then
either party, on behalf of both, may request appointment of the third arbitrator
by the Association of South Bay Brokers.  The three arbitrators shall decide the
dispute, if it has not been previously resolved, by following the procedures set
forth in  PARAGRAPH  4.C.(VI)(C).  Each party shall pay the fees and expenses of
its  respective  arbitrator  and both shall  share the fees and  expenses of the
third  arbitrator.  Each party  shall pay its own  attorneys'  fees and costs of
witnesses.

                                    (c) The three  arbitrators  shall  determine
the fair  market  rent in  accordance  with the  following  procedures.  Each of
Landlord's  arbitrator and Tenant's  arbitrator shall state, in writing,  his or
her  determination of the fair market rent,  supported by the reasons  therefor,
and  shall  make  counterpart  copies  for  the  other  arbitrators.  All of the
arbitrators   shall  arrange  for  a  simultaneous   exchange  of  the  proposed
resolutions  within  ten (10)  business  days  after  appointment  of the  third
arbitrator. If any arbitrator fails to

                                       18
<PAGE>
deliver his or her own  determination to the other  arbitrators  within such ten
(10)  business day period,  then the fair market rent shall equal the average of
the resolutions submitted by the other arbitrators. If all three (3) arbitrators
deliver  their  determinations  to the other  arbitrators  within  such ten (10)
business day period, then the two (2) closest  determinations of the arbitrators
shall be averaged, and the resulting quotient shall be the fair market rent, and
the Monthly Rent for the Extended Term shall equal one hundred percent (100%) of
such fair market rent; provided,  however,  that if the determination of one (1)
of the arbitrators (the "AVERAGE  DETERMINATION") is equal to the average of the
determinations of the other two (2) arbitrators,  then the Average Determination
shall be the fair market rent.  However,  the  arbitrators  shall not attempt to
reach a  mutual  agreement  of the  fair  market  rent;  each  arbitrator  shall
independently arrive at his or her proposed resolution.

                                    (d) The arbitrators  shall have the right to
consult experts and competent  authorities  for factual  information or evidence
pertaining to a  determination  of fair market rent,  but any such  consultation
shall be made in the  presence of both  parties with full right on their part to
cross-examine.  The  arbitrators  shall render the decision and award in writing
with counterpart  copies to each party.  The arbitrators  shall have no power to
modify the  provisions  of this  Lease.  In the event of a  failure,  refusal or
inability of any  arbitrator to act, his or her successor  shall be appointed by
him or her, but in the case of the third arbitrator,  his or her successor shall
be  appointed  in the same manner as that set forth  herein with  respect to the
appointment of the original third arbitrator.

         5.  RENT AND ADDITIONAL CHARGES.

                  A. MONTHLY RENT. Tenant shall pay to Landlord, in lawful money
of the United States,  Monthly Rent as follows:  commencing on the  Commencement
Date, and  continuing  throughout the balance of the Term (subject to adjustment
pursuant  to  PARAGRAPH  5.B),  the Monthly  Rent shall equal Two and  25/100ths
Dollars  ($2.25)  multiplied  by the  number of  square  feet of  Rentable  Area
situated within the Premises, as determined by Landlord under PARAGRAPH 2.

                  Monthly  Rent  shall be paid in  advance,  on the first day of
each  calendar  month  during the Term,  without  abatement,  deduction,  claim,
offset, prior notice or demand. The sum of One

                                       19
<PAGE>
Hundred Twenty Four Three Hundred Eighty Four and 50/100 Dollars  ($124,384.50),
representing  an advance payment of Landlord's  initial  estimate of the Monthly
Rent for the Premises, shall be paid by Tenant to Landlord upon the execution of
this Lease by Landlord and Tenant.  Additionally,  Tenant shall pay, as and with
the Monthly Rent, the management fee described in PARAGRAPH 5.C., Tenant's share
of Common Area  Maintenance  Costs  pursuant to PARAGRAPH 5.D, the Real Property
Taxes and  Impositions  payable  by Tenant  pursuant  to  PARAGRAPH  15, and the
monthly cost of insurance premiums required pursuant to PARAGRAPH 21.C.

                  B.  ADJUSTMENTS  TO MONTHLY  RENT.  The Monthly  Rent shall be
increased,  but not decreased, as of the first day of the month that is thirteen
(13) months from the  Commencement  Date and each and every  anniversary of such
date occurring  thereafter  during the Term  (including  without  limitation the
Extended  Term) (each,  an "ADJUSTMENT  DATE") by three and  one-fourth  percent
(3.25%).  If,  however,  the last  Adjustment  Date occurs at any time after the
first day of a calendar month,  the first Adjustment Date shall be the first day
of the immediately  following calendar month. On each Adjustment Date, the total
aggregate  amount of  Monthly  Rent then in effect  shall be  multiplied  by one
hundred three and one fourth percent  (103.25%);  and the corresponding  product
shall be the Monthly Rent in effect until the next Adjustment Date.

                  C. MANAGEMENT FEE.  Tenant shall pay to Landlord  monthly,  as
Additional  Rent,  a  management  fee  equal to three  percent  (3%) of the then
Monthly Rent.

                  D. COMMON AREA MAINTENANCE COSTS.

                           (i)   ESTIMATED    PAYMENTS.    Commencing   on   the
Commencement  Date and continuing  throughout the entire Term,  Tenant shall pay
Tenant's  Percentage Share of all Common Area Maintenance  Costs paid or payable
by Landlord in each year;  provided,  however,  that Tenant  shall pay  Tenant's
Building Share of those Common Area  Maintenance  Costs arising from  Landlord's
performance of its obligations  under  PARAGRAPHS 17.A and Tenant's  obligations
under  PARAGRAPH  17.D.  Before  commencement of the Term and during December of
each calendar year or as soon  thereafter as  practicable,  Landlord  shall give
Tenant notice of its estimate of amounts  payable under this  PARAGRAPH  5.D.(I)
for the ensuing  calendar year. Such notice shall show in reasonable  detail the
basis on which the estimate was determined. On or

                                       20
<PAGE>
before the first day of each month  during the  ensuing  calendar  year,  Tenant
shall pay to Landlord one-twelfth  (1/12th) of such estimated amounts,  provided
that if such notice is not given in December,  Tenant  shall  continue to pay on
the basis of the prior  year's  estimate  until the month  after such  notice is
given.  If at any  time or times  it  appears  to  Landlord,  in its  reasonable
judgment,  that the amounts payable under this PARAGRAPH 5.D.(I) for the current
calendar year will vary from its then-current estimate by more than five percent
(5%),  Landlord  may, in its sole  discretion,  by notice to Tenant,  showing in
reasonable  detail the basis for such  variance,  revise its  estimate  for such
year, in which case  subsequent  payments by Tenant for such year shall be based
upon such revised estimate. Landlord's election not to give the notice described
in the foregoing  sentence shall not affect Landlord's  ability to charge Tenant
for, nor Tenant's  liability to pay for, any shortfall in the estimated payments
for such  calendar  year  previously  made by Tenant,  as set forth in PARAGRAPH
5.D.(II).

                           (ii) ADJUSTMENT. Within one hundred twenty (120) days
after the close of each  calendar  year or as soon after such 120-day  period as
reasonably  practicable,  Landlord shall deliver to Tenant a reasonably detailed
statement of Common Area Maintenance Costs for such calendar year,  certified by
Landlord  or its  property  manager,  subject  to  Tenant's  right  to  audit as
hereinafter  provided.  At that time,  Landlord  shall also  deliver to Tenant a
statement,  certified  as correct by  Landlord,  of the  adjustments  to be made
pursuant to PARAGRAPH  5.D.(I) above. If Landlord's  statement shows that Tenant
owes an amount that is less than the  estimated  payments for such calendar year
previously  made by Tenant,  Landlord  shall refund such excess to Tenant within
thirty (30) days after delivery of the statement.  If such statement  shows that
Tenant owes an amount that is more than the estimated payments for such calendar
year  previously  made by Tenant,  Tenant shall pay the  deficiency  to Landlord
within thirty (30) days after delivery of the statement.

                           (iii) LAST YEAR.  If this Lease shall  terminate on a
day  other  than  the  last  day of a  calendar  year,  the  adjustment  in Rent
applicable to the calendar year in which such  termination  shall occur shall be
prorated  on the basis  which the number of days from the  commencement  of such
calendar  year to and  including  such  termination  date bears to three hundred
sixty (360). The termination of this Lease shall not affect the

                                       21
<PAGE>
obligations  of  Landlord  and  Tenant  pursuant  to  PARAGRAPH  5.D.(II)  to be
performed after such termination.

                           (iv)  AUDIT.  Within one  hundred  eighty  (180) days
after  receipt of  Landlord's  statement  of Common  Area  Maintenance  Costs as
provided in PARAGRAPH  5.D.(II),  Tenant or its designee,  on not less than five
(5) days' prior written notice to Landlord, shall have the right to, at Tenant's
sole cost and expense, audit, examine and copy Landlord's books and records with
respect  to the  Common  Area  Maintenance  Costs  for the  year for  which  the
Landlord's  statement  pertains.  If Tenant fails to give such written notice to
Landlord  within such  180-day  period,  Tenant  shall be deemed to have forever
waived its right to audit the  Common  Area  Maintenance  Costs for the year for
which the Landlord's statement pertains. Landlord shall cooperate with Tenant in
any such  examination  of its books and records.  Tenant shall have the right to
audit at Landlord's local offices, at Tenant's expense,  Landlord's accounts and
records relating to Common Area Maintenance Costs and Impositions. If such audit
reveals to the reasonable  satisfaction of Landlord and Tenant that Landlord has
overcharged Tenant, the amount overcharged shall be paid to Tenant within thirty
(30) days after the audit is concluded.  If such audit reveals to the reasonable
satisfaction of Landlord and Tenant that Landlord has undercharged  Tenant,  the
amount  undercharged shall be paid to Landlord within thirty (30) days after the
audit  is  concluded.  In  addition,  if the  audit  reveals  to the  reasonable
satisfaction of Landlord and Tenant that Landlord's statement exceeds the actual
Common Area Maintenance  Costs and Impositions which should have been charged to
Tenant by more than seven percent  (7%),  the cost of the audit shall be paid by
Landlord.  If Tenant  retains or utilizes a third party to perform such an audit
of  the  Common  Area  Maintenance  Costs  and  Impositions,  Tenant  shall  not
compensate such third party on anything other than an hourly basis.

                  E.  ADDITIONAL  RENT. All monies required to be paid by Tenant
under this Lease,  including,  without limitation,  the Tenant Improvement costs
pursuant to EXHIBIT B, the management  fee described in PARAGRAPH 5.D,  Tenant's
share of Common Area Maintenance  Costs pursuant to PARAGRAPH 5.D, Real Property
Taxes  and  Impositions  pursuant  to  PARAGRAPH  15,  and the  monthly  cost of
insurance  premiums  required  pursuant  to  PARAGRAPH  21.C,  shall  be  deemed
Additional Rent.

                                       22
<PAGE>
                  F. PRORATIONS. If the Commencement Date is not the first (1st)
day of a month, or if the termination  date of this Lease is not the last day of
a month, a prorated installment of Monthly Rent based on a 30-day month shall be
paid for the  fractional  month  during  which  such  date  occurs  or the Lease
terminates.

                  G. INTEREST.  Any amount of Rent or other charges provided for
under this Lease due and payable to  Landlord  which is not paid within five (5)
days after written notice from Landlord shall bear interest at the Interest Rate
from (i) the date  such Rent is due  until  such Rent is paid,  or (ii) the date
that is ten (10) days after Tenant  receives  written  notice from Landlord that
any other  charge  provided  for under this Lease  (other  than Rent) is due and
payable, until such other charge is paid.

         6.       LATE PAYMENT CHARGES.

                  Tenant acknowledges that late payment by Tenant to Landlord of
Rent and other  charges  provided  for under this Lease will cause  Landlord  to
incur costs not contemplated by this Lease, the exact amount of such costs being
extremely  difficult or impracticable to fix.  Therefore,  if any installment of
Rent or any other charge due from Tenant is not received by Landlord within five
(5) days after  Landlord  gives Tenant  notice that such Rent or other charge is
due,  Tenant shall pay to Landlord an additional sum equal to seven percent (7%)
of the amount  overdue as a late charge for every month or portion  thereof that
the Rent or other charges remain unpaid. The parties agree that this late charge
represents a fair and reasonable  estimate of the costs that Landlord will incur
by reason of the late payment by Tenant.

INITIALS:

/s/ signature illegible                              /s/ signature illegible
------------------------                             -------------------------
Landlord                                                      Tenant


         7.       SECURITY DEPOSIT.

                  A. DEPOSIT  REQUIRED.  Tenant shall deposit with Landlord upon
the  execution  of this Lease by Landlord  and Tenant,  the sum of Four  Hundred
Ninety-Seven Thousand Five Hundred

                                       23
<PAGE>
Thirty-Eight and 00/100 Dollars ($497,538.00) (i.e., an amount equal to four (4)
installments  of  Monthly  Rent)  as the  "SECURITY  DEPOSIT"  for the  full and
faithful performance of every provision of this Lease to be performed by Tenant.
At Tenant's  option,  the Security  Deposit may be in the form of an irrevocable
standby  letter of credit  ("L-C").  Landlord shall not be required to segregate
the Security Deposit from Landlord's general funds;  Landlord's obligations with
respect to the  Security  Deposit  shall be those of a debtor and not a trustee,
and Tenant  shall not be  entitled  to any  interest  on the  Security  Deposit.
Invocation by Landlord of its rights  hereunder shall not constitute a waiver of
nor relieve  Tenant from any liability or  obligation  for any default by Tenant
under this Lease.

                           (i) REDUCTION OR  REPLACEMENT.  So long as Tenant has
not committed any default  under this Lease,  which default is continuing  after
notice from Landlord and the expiration of any applicable  grace period provided
for in this Lease,  (a) as of each of the second (2nd)  anniversary of the Lease
Commencement  Date and the fourth (4th)  anniversary  of the Lease  Commencement
Date,  Tenant  may  reduce the  Security  Deposit  in the amount of One  Hundred
Twenty-Four Thousand Three Hundred Eighty-Four and 50/100 Dollars  ($124,384.50)
on each such  anniversary  date; or (b) if Tenant is profitable  for a period of
eight (8) consecutive  quarters  commencing  after the  Commencement  Date, then
Tenant  may elect to reduce  the  Security  Deposit  to the sum equal to two (2)
installments  of the initial Monthly Rent. For the purposes of this PARAGRAPH 7,
in order for Tenant to demonstrate  that it has been profitable for the calendar
quarter in  question,  Tenant  must at a minimum  deliver to Landlord an audited
financial  statement of Tenant,  showing that Tenant has earned a net profit for
each  calendar  quarter in  question.  In no event  shall  Tenant be entitled to
reduce the Security Deposit below an amount equal to two (2) installments of the
initial Monthly Rent.

                  If Tenant is  entitled  to and does elect to reduce the amount
of the Security Deposit pursuant to this PARAGRAPH 7.A.(I),  and Tenant delivers
to  Landlord  written  notice of its  election  to so reduce  the  amount of the
Security  Deposit  and  the  financial  statements  described  in the  foregoing
paragraph,  then if the Security Deposit is in the form of cash,  Landlord shall
pay to Tenant the  excess  amount of the  Security  Deposit,  without  interest,
within thirty (30) days after Landlord's  receipt of such notice and statements;
or if the Security  Deposit is in the form of an L-C,  then Tenant may, not less
than ten (10) days

                                       24
<PAGE>
after Landlord's  receipt of such notice and statement,  replace the L-C with an
L-C in an amount equal to the reduced amount of the Security Deposit.

                           (ii) CONSEQUENCES OF DEFAULT. If Tenant defaults with
respect to any  provision  of this Lease,  after  notice from  Landlord  and the
expiration of any  applicable  cure or grace periods  expressly  provided for in
this Lease,  Landlord may apply all or any part of the Security  Deposit for the
payment of any Rent or other sum in  default,  the repair of such  damage to the
Premises or the payment of any other amount  which  Landlord may spend or become
obligated to spend by reason of Tenant's  default or to compensate  Landlord for
any other loss or damage which Landlord may suffer by reason of Tenant's default
to the full extent  permitted by law. If any portion of a cash Security  Deposit
is so  applied,  or any  portion of an L-C posted as the  Security  Deposit,  if
applicable,  is drawn upon, by Landlord for such purposes,  Tenant shall either,
within ten (10) days after written demand  therefor,  deposit cash with Landlord
in an amount  sufficient to restore the Security  Deposit to its original amount
or deposit a  replacement  L-C with  Landlord in the amount of the original L-C.
The Security  Deposit or any balance thereof  remaining after Landlord cures any
default of Tenant  hereunder shall be returned to Tenant within thirty (30) days
of termination of the Lease.

                           (iii) FORM OF L-C.  If at any time  Tenant  elects to
deposit  an L-C as the  Security  Deposit,  the L-C  shall be  issued  by a bank
reasonably acceptable to Landlord, shall be issued for a term of at least twelve
(12) months and shall be in a form and with such content  acceptable to Landlord
in its sole discretion. Tenant shall either replace the expiring L-C with an L-C
in an amount equal to the  original L-C or renew the expiring  L-C, in any event
no later than  thirty (30) days prior to the  expiration  of the term of the L-C
then in  effect.  If  Tenant  fails to  deposit a  replacement  L-C or renew the
expiring  L-C,  Landlord  shall have the right to draw upon the expiring L-C for
the full amount  thereof and hold the same as the  Security  Deposit;  provided,
however,  that if Tenant provides a replacement L-C that meets the  requirements
of this  PARAGRAPH  7.A, then Landlord  shall return to Tenant  promptly in cash
that amount of the L-C that had been drawn upon by  Landlord.  Drawing  upon the
L-C shall be conditioned  upon notice to Tenant of Landlord's  intention to draw
upon  the L-C and  the  presentation  to the  issuer  of the L-C of a  certified
statement executed by a general partner of Landlord

                                       25
<PAGE>
that (i) Tenant is in default under the Lease, which default is continuing after
notice to Tenant and the expiration of any applicable  grace period provided for
herein,  and Landlord is exercising its right to draw upon so much of the L-C as
is  necessary  to cure  Tenant's  default,  or (ii)  Tenant  has not  renewed or
replaced an expiring L-C as required by this Lease and Landlord is authorized to
draw upon the L-C  prior to its  expiration.  The L-C  shall  not be  mortgaged,
assigned or  encumbered  in any manner  whatsoever  by Tenant  without the prior
written  consent of Landlord.  The use,  application or retention of the L-C, or
any portion thereof,  by Landlord shall not prevent Landlord from exercising any
other right or remedy  provided by this Lease or by law, it being  intended that
Landlord  shall not first be required to proceed  against the L-C, and such use,
application  or retention  shall not operate as a limitation  on any recovery to
which Landlord may otherwise be entitled.

         8.       HOLDING OVER.

                  If  Tenant  remains  in  possession  of all or any part of the
Premises after the expiration of the Term,  with the express or implied  consent
of Landlord,  such tenancy shall be at sufferance only, and shall not constitute
a renewal or extension  for any further  term.  If Tenant  remains in possession
after the  expiration of the Term,  without  Landlord's  consent,  Rent shall be
payable at a rental  equal to one hundred  fifty  percent  (150%) of the Monthly
Rent  payable  during the last month of the Term (which  rental shall be due and
payable at the same time as Monthly Rent is due under this Lease), and any other
sums due under  this  Lease  shall be  payable  in the  amount  and at the times
specified in this Lease. If Tenant remains in possession after the expiration of
the Term with Landlord's consent, Rent shall be payable at a rental equal to one
hundred  percent (100%) of the Monthly Rent payable during the last month of the
Term (which  rental shall be due and payable at the same time as Monthly Rent is
due under this Lease),  and any other sums due under this Lease shall be payable
in the  amount  and at the times  specified  in this  Lease.  Any such  holdover
tenancy  (with or without  Landlord's  consent)  shall be subject to every other
term,  condition,  and  covenant  contained  herein;  provided,   however,  that
Landlord's obligations under the Work Letter shall not be of any force or effect
during any such holdover tenancy.

                                       26
<PAGE>
         9.       TENANT IMPROVEMENTS.

                  Landlord agrees to construct the Tenant Improvements  pursuant
to the terms of EXHIBIT B.

         10.      CONDITION OF PREMISES.

                  A.  CAPITAL  IMPROVEMENTS.  Prior  to the  Commencement  Date,
Landlord shall complete the Capital  Improvements  to the Premises in accordance
with the terms of EXHIBIT B.  Except for its  obligation  to perform the Capital
Improvements and the Tenant Improvements as set forth in this Lease and the Work
Letter,  Landlord shall have no obligation  whatsoever to do any work or perform
any improvements whatsoever to any portion of the Premises or the Building.

                  B.  ACCEPTANCE  OF  PREMISES.   Within  ten  (10)  days  after
completion  of the Tenant  Improvements,  Tenant  shall  conduct a  walk-through
inspection  of the  Premises  with  Landlord  and complete a punch list of items
needing  additional  work.  Other than the items specified in the punch list, if
any,  and latent  defects in the Capital  Improvements  that could not have been
discovered  by  a  reasonably   thorough   visual   inspection  of  the  Capital
Improvements, and subject to Landlord's representations and warranties described
below,  by taking  possession  of the  Premises,  Tenant shall be deemed to have
accepted the Premises in good, clean and completed condition and repair, subject
to all applicable laws, codes and ordinances.  Any damage to the Premises caused
by Tenant's  move-in shall be repaired or corrected by Tenant,  at its sole cost
and expense.  Tenant  acknowledges  that neither Landlord nor Landlord's  Agents
have made any  representations or warranties as to the suitability or fitness of
the Premises for the conduct of Tenant's business or for any other purpose,  nor
has  Landlord or  Landlord's  Agents  agreed to  undertake  any  Alterations  or
construct any Improvements to the Premises except as expressly  provided in this
Lease.  If Tenant  fails to submit a punch list to  Landlord  within such 10-day
period,  it  shall  be  deemed  that  there  are no  Improvement  items  needing
additional work or repair.  Landlord's  contractor shall complete all reasonable
punch-list  items  within  thirty (30) days after the  walk-through  inspection;
provided,  however, that if such punch-list items cannot reasonably be completed
within the 30-day period,  Landlord's contractor shall commence such performance
within  the  30-day  period  and  diligently  thereafter  prosecute  the same to
completion. Upon completion of such

                                       27
<PAGE>
punch-list  items,  Tenant  shall  approve  such  completed  items in writing to
Landlord.  If Tenant fails to approve such items  within  fourteen  (14) days of
completion, such items shall be deemed approved by Tenant.

                  C.  LANDLORD'S   REPRESENTATIONS   AND  WARRANTIES.   Landlord
represents and warrants (the  "Condition  Warranties")  to Tenant that as of the
Commencement  Date  the  following  portions  of the  Building  shall be in good
condition  (i.e. in an operable  (but not new) state of repair,  free of defects
that would adversely affect Tenant's operation of its business in the Premises):
(i) the HVAC system serving the Premises,  (ii) the roof of the Building,  (iii)
the main electrical  supply to a main distribution  point in the Building,  (iv)
the working  sanitary sewer lines to the Building,  and (v) water service to the
Building.  The Condition Warranties shall terminate on a date one hundred eighty
(180) days after the  Commencement  Date,  except to the extent  that Tenant has
delivered to Landlord within such 180-day period a written notice  specifying in
detail any defaults by Landlord  under the  Condition  Warranties  (a "Violation
Notice"),  and Landlord shall  thereafter have absolutely no liability to Tenant
for the inaccuracy of any Condition Warranty,  except to the extent set forth in
a Violation  Notice.  Landlord's  liability  for the  correction  of any defects
described in a Violation Notice shall be subject to Landlord's  reasonable right
to  dispute  the  claims  set forth in any  Violation  Notice.  Landlord's  sole
liability with respect to any breach of any Condition  Warranty that is properly
set forth in a timely  delivered  Violation  Notice shall be to promptly correct
such defect;  Landlord shall have no liability for any other loss, cost, damage,
expense or lost profit in connection with such breach,  and Tenant shall have no
right to any abatement or offset of Rent in connection with such breach.

                  D. LANDLORD'S ADDITIONAL REPRESENTATION AND WARRANTY. Landlord
represents  and warrants  (the  "Environmental  Warranty") to Tenant that to the
best   of   Landlord's   knowledge,    as   of   the   Commencement   Date,   no
asbestos-containing materials (other than asbestos-containing materials that are
fully encapsulated or that are within the transite panels of the curtain wall of
the  Building)shall  be present in the Premises.  Landlord's sole liability with
respect to any breach of the Environmental Warranty shall be to promptly correct
such defect;  Landlord shall have no liability for any other loss, cost, damage,
expense or lost profit in connection with such breach, and Tenant shall have

                                       28
<PAGE>
no right to any abatement or offset of Rent in connection with such breach.

         11.      USE OF THE PREMISES AND COMMON AREA.

                  A.  TENANT'S  USE.  Tenant  shall  use the  Premises  only for
general  office,  administration,   research  and  development,   manufacturing,
warehousing  and any other legal use related to such  activities  and consistent
with any CC&Rs.  Tenant shall not use the Premises or suffer or permit  anything
to be done in or about the Premises which will in any way conflict with any law,
statute, zoning restriction,  ordinance or governmental law, rule, regulation or
requirement  of public  authorities  now in force or which may  hereafter  be in
force, relating to or affecting the condition, use or occupancy of the Premises.
Tenant shall not commit any public or private nuisance or any other act or thing
which might or would disturb the quiet enjoyment of any other tenant of Landlord
or any occupant of nearby property. Tenant shall place no loads upon the floors,
walls or  ceilings  in excess  of the  maximum  designed  load  determined  by a
licensed  structural  engineer or which  endanger the  structure;  nor place any
harmful  liquids in the drainage  systems;  nor dump or store waste materials or
refuse or allow waste materials or refuse to remain outside the Building proper,
except in the enclosed trash areas provided. Tenant shall not store or permit to
be stored or  otherwise  placed  any other  material  of any  nature  whatsoever
outside the Building, except on a temporary basis.

                  B.       HAZARDOUS MATERIALS.

                           (i) HAZARDOUS  MATERIALS DEFINED. As used herein, the
term  "HAZARDOUS  MATERIALS"  shall mean any  wastes,  materials  or  substances
(whether in the form of liquids, solids or gases, and whether or not air-borne),
which are or are deemed to be (a)  pollutants or  contaminants,  or which are or
are deemed to be hazardous, toxic, ignitable,  reactive,  corrosive,  dangerous,
harmful  or  injurious,  or which  present  a risk to  public  health  or to the
environment,  or which are or may become  regulated by or under the authority of
any applicable  local,  state or federal laws,  judgments,  ordinances,  orders,
rules,  regulations,  codes or other  governmental  restrictions,  guidelines or
requirements,  any amendments or successor(s)  thereto,  replacements thereof or
publications promulgated pursuant thereto,  including,  without limitation,  any
such  items  or  substances  which  are or may  become  regulated  by any of the
Environmental Laws (as hereinafter

                                       29
<PAGE>
defined);  (b) listed as a chemical  known to the State of  California  to cause
cancer or  reproductive  toxicity  pursuant to Section 25249.8 of the California
Health and Safety Code,  Division 20, Chapter 6.6 (Safe Drinking Water and Toxic
Enforcement Act of 1986); or (c) a pesticide,  petroleum, including crude oil or
any  fraction  thereof,   asbestos  or  any   asbestos-containing   material,  a
polychlorinated biphenyl, radioactive material, or urea formaldehyde.

                           (ii) ENVIRONMENTAL  LAWS DEFINED.  In addition to the
laws referred to in PARAGRAPH  11.B.(I)  above,  the term  "ENVIRONMENTAL  LAWS"
shall be deemed to include, without limitation,  33 U.S.C. Section 1251 ET SEQ.,
42 U.S.C.  Section  6901 ET SEQ.,  42  U.S.C.  Section  7401 ET SEQ.,  42 U.S.C.
Section 9601 ET SEQ.,  and  California  Health and Safety Code Section  25100 ET
SEQ., and 25300 ET SEQ.,  California  Water Code,  Section 13020 ET SEQ., or any
successor(s) thereto, all local, state and federal laws, judgments,  ordinances,
orders,  rules,   regulations,   codes  and  other  governmental   restrictions,
guidelines and requirements, any amendments and successors thereto, replacements
thereof  and  publications  promulgated  pursuant  thereto,  which  deal with or
otherwise in any manner relate to, air or water quality, air emissions,  soil or
ground conditions or other environmental matters of any kind.

                           (iii) USE OF HAZARDOUS MATERIALS.  Tenant agrees that
during the Term of this Lease,  Tenant  shall not use, or permit the use of, nor
store, generate,  treat,  manufacture or dispose of Hazardous Materials on, from
or under the Premises (individually and collectively, "HAZARDOUS USE") except to
the extent that, and in accordance  with such  conditions as,  Landlord may have
previously   approved   in  writing  in  its  sole  and   absolute   discretion.
Notwithstanding  the  foregoing,  Tenant shall be entitled to use and store only
those  Hazardous  Materials which are (a) set forth in a list prepared by Tenant
and approved in writing by Landlord, which shall be deemed given with respect to
the Approved  Hazardous  Materials  (hereinafter  defined),  (b)  necessary  for
Tenant's business,  but then only in the amounts and for the purposes previously
disclosed  in writing to and  approved in writing by  Landlord,  and (c) in full
compliance  with  Environmental   Laws,  and  all  judicial  and  administrative
decisions  pertaining  thereto.  All Hazardous  Materials approved in writing by
Landlord as provided in the preceding sentence shall collectively be referred to
as the "APPROVED HAZARDOUS MATERIALS".  Within thirty (30) days after request by
Landlord,

                                       30
<PAGE>
Tenant  shall  deliver to Landlord a list of the Approved  Hazardous  Materials.
Tenant  shall  not be  entitled  to  install  any tanks  under,  on or about the
Premises  for the storage of  Hazardous  Materials  without the express  written
consent  of  Landlord,  which  may be  given  or  withheld  in  Landlord's  sole
discretion.  For the purposes of this PARAGRAPH  11.B.(III),  the term Hazardous
Use shall include Hazardous Use(s) on, from or under the Premises by Tenant, any
Subtenant  occupying all or any portion of the Premises  during the Term, or any
of their  directors,  officers,  employees,  shareholders,  partners,  invitees,
agents,  contractors or occupants  (collectively,  "TENANT'S PARTIES"),  whether
known or unknown to Tenant,  occurring  during the Term of this Lease.  The term
"TENANT'S  PARTIES"  shall not include  any  tenants of the  Project  other than
Tenant,  except that the term  "TENANT'S  PARTIES"  shall  include any Subtenant
occupying  all or any portion of the Premises  during the Term.  Notwithstanding
anything  herein to the  contrary,  Tenant  may use normal  amounts of  cleaning
supplies  and  office  products  customarily  used  by  office  tenants  without
Landlord's prior consent thereto.

                           (iv)  HAZARDOUS   MATERIALS  REPORT;  WHEN  REQUIRED.
Tenant  shall  submit to  Landlord a written  report with  respect to  Hazardous
Materials  ("REPORT") in the form prescribed in PARAGRAPH  11.B.(V) below on the
following dates:

                                    (a) At any time  within  ten (10) days after
written request by Landlord, and

                                    (b)  At  any  time  when  there  has  been a
violation of any  Environmental  Law, or in connection with any proposed request
for Landlord's consent to any change in the list of Approved Hazardous Materials
or for an  increase  in the  intensity  of usage  or  storage  of such  Approved
Hazardous Materials.

                           (v) HAZARDOUS MATERIALS REPORT;  CONTENTS. The Report
shall contain, without limitation, the following information:

                                    (a)  Whether  on the date of the  Report and
(if  applicable)  during the  period  since the last  Report  there has been any
Hazardous  Use on,  from or under the  Premises,  other than the use of Approved
Hazardous Materials.

                                       31
<PAGE>
                                    (b) If there  was such  Hazardous  Use,  the
exact  identity of the Hazardous  Materials  (other than the Approved  Hazardous
Materials),  the dates upon which such materials were brought upon the Premises,
the dates upon which such Hazardous  Materials were removed  therefrom,  and the
quantity, location, use and purpose thereof.

                                    (c) If there  was such  Hazardous  Use,  any
governmental  permits  maintained  by  Tenant  with  respect  to such  Hazardous
Materials,  the issuing agency,  original date of issue,  renewal dates (if any)
and expiration date. Copies of any such permits and applications  therefor shall
be attached.

                                    (d) If there  was such  Hazardous  Use,  any
governmental reporting or inspection requirements with respect to such Hazardous
Materials,  the  governmental  agency to which  reports  are made  and/or  which
conducts  inspections,  and the dates of all such reports and/or inspections (if
applicable) since the last Report. Copies of any such Reports shall be attached.

                                    (e)  If  there  was  such   Hazardous   Use,
identification  of any operation or business  plan  prepared for any  government
agency with respect to Hazardous Use.

                                    (f)  Any  liability   insurance  carried  by
Tenant with respect to Hazardous Materials,  if any, the insurer, policy number,
date of issue,  coverage  amounts,  and date of  expiration.  Copies of any such
policies or certificates of coverage shall be attached.

                                    (g)   Any    notices   of    violation    of
Environmental  Laws,  written or oral,  received by Tenant from any governmental
agency since the last  Report,  the date,  name of agency,  and  description  of
violation. Copies of any such written notices shall be attached.

                                    (h)   Any    knowledge,    information    or
communication  which  Tenant  has  acquired  or  received  relating  to (x)  any
enforcement,  cleanup,  removal  or  other  governmental  or  regulatory  action
threatened or commenced  against Tenant or with respect to the Premises pursuant
to any  Environmental  Laws;  (y) any claim made or  threatened by any person or
entity  against  Tenant or the Premises on account of any alleged loss or injury
claimed to result from any alleged  Hazardous Use on or about the  Premises;  or
(z) any report, notice or complaint made to or filed

                                       32
<PAGE>
with any  governmental  agency  concerning  any  Hazardous  Use on or about  the
Premises.  The Report shall be accompanied by copies of any such claim,  report,
complaint,  notice,  warning or other communication that is in the possession of
or is available to Tenant.

                                    (i)  Such  other  pertinent  information  or
documents as are reasonably requested by Landlord in writing.

                           (vi) RELEASE OF HAZARDOUS MATERIALS; NOTIFICATION AND
CLEANUP.

                                    (a) At any time  during the Term,  if Tenant
knows or believes that any release of any  Hazardous  Materials has come or will
come to be located  upon,  about or beneath  the  Premises,  then  Tenant  shall
immediately,  either prior to the release or following the discovery  thereof by
Tenant, give verbal and follow-up written notice of that condition to Landlord.

                                    (b) At its  sole  cost and  expense,  Tenant
covenants  to  investigate,  clean up and  otherwise  remediate  any  release of
Hazardous  Materials  which were  caused or created by Tenant or any of Tenant's
Parties.  Such  investigation,  clean-up and remediation shall be performed only
after Tenant has obtained,  if practicable,  Landlord's  written consent,  which
shall not be  unreasonably  withheld;  provided,  however,  that Tenant shall be
entitled  to  respond  immediately  to  an  emergency  without  first  obtaining
Landlord's  written  consent.  All  clean-up  and  remediation  shall be done in
compliance  with  Environmental  Laws  and to  the  reasonable  satisfaction  of
Landlord;  provided,  however, that Landlord shall not require Tenant to perform
any clean-up or  remediation  work in excess of that work required to return the
property affected by such release of Hazardous Materials to the condition it was
in prior to the date of such release.

                                    (c) Notwithstanding the foregoing,  Landlord
shall have the right,  but not the  obligation,  in Landlord's sole and absolute
discretion,  exercisable  by written  notice to Tenant,  to undertake  within or
outside  the  Premises  all or any  portion  of  any  reasonable  investigation,
clean-up or  remediation  with respect to any  Hazardous  Use of such  Hazardous
Materials by Tenant or any of Tenant's  Parties (or, once having  undertaken any
of such work, to cease same,  in which case Tenant shall perform the work),  all
at Tenant's sole cost and expense, which shall be

                                       33
<PAGE>
paid by Tenant as Additional  Rent within ten (10) days after receipt of written
request therefor by Landlord (and which Landlord may require to be paid prior to
commencement  of  any  work  by  Landlord);  provided,  however,  that  Tenant's
obligation  to pay for such work shall  only be  applicable  if Tenant  fails to
perform its obligations  under this PARAGRAPH 11 (including  without  limitation
the obligations described in PARAGRAPH  11.B.(VI)(B)).  No such work by Landlord
shall create any  liability on the part of Landlord to Tenant or any other party
in connection with such Hazardous Materials by Tenant or any of Tenant's Parties
or  constitute  an admission by Landlord of any  responsibility  with respect to
such Hazardous Materials.

                                    (d)  It is  the  express  intention  of  the
parties  hereto that Tenant shall be liable under this  PARAGRAPH  11.B.(VI) for
any and all  conditions  covered  hereby  which were or are caused or created by
Tenant  or any of  Tenant's  Parties,  whether  occurring  (x) on or  after  the
Commencement  Date,  or (y) prior to the  Commencement  Date (to the extent that
such condition or conditions occurring prior to the Commencement Date arise from
Tenant's early occupancy of the Premises pursuant to PARAGRAPH 40 below). Tenant
shall  not  enter  into  any  settlement  agreement,  consent  decree  or  other
compromise with respect to any claims relating to any Hazardous Materials in any
way connected to the Premises  without first (A) notifying  Landlord of Tenant's
intention to do so and affording  Landlord the opportunity to participate in any
such proceedings,  and (B) obtaining Landlord's written consent, which shall not
be unreasonably withheld.

                           (vii)  INSPECTION  AND TESTING BY LANDLORD.  Landlord
shall have the right at all times  during the Term of this Lease to (a)  inspect
the Premises,  as well as such of Tenant's  books and records  pertaining to the
Premises and the conduct of Tenant's business therein,  and to (b) conduct tests
and  investigations  to  determine  whether  Tenant  is in  compliance  with the
provisions of this PARAGRAPH 11.B.  Except in case of emergency,  Landlord shall
give reasonable  notice to Tenant before  conducting any inspections,  tests, or
investigations in accordance with PARAGRAPH 19, shall provide Tenant with a work
plan  describing any testing that shall be performed at the Premises,  and shall
use  reasonable  efforts to minimize  interference  with the conduct of Tenant's
business  at  the  Premises   caused  by  any  such   inspections,   tests,   or
investigations. The cost of all such inspections, tests and investigations shall
be borne by Tenant if Landlord reasonably

                                       34
<PAGE>
concludes  on the basis of such  investigation  that Tenant has failed to comply
with its obligations under this PARAGRAPH 11.B.  Neither any action nor inaction
on the part of Landlord pursuant to this PARAGRAPH 11.B.(VII) shall be deemed in
any  way to  release  Tenant  from,  or in any way  modify  or  alter,  Tenant's
responsibilities,  obligations,  and liabilities  incurred pursuant to PARAGRAPH
11.B hereof.

                           (viii)  INDEMNITY.  Tenant shall  indemnify,  defend,
protect,  hold  harmless,  and, at  Landlord's  option  (with such  attorneys as
Landlord may approve in advance and in  writing),  defend  Landlord,  Landlord's
Agents, and Landlord's officers, directors,  shareholders,  partners, employees,
contractors,  property  managers,  agents and mortgagees and other lien holders,
from and  against any and all Losses (as defined  below),  whenever  such Losses
arise,  arising from or related to: (a) any  violation  or alleged  violation by
Tenant  or any of  Tenant's  Parties  of  any of the  requirements,  ordinances,
statutes,  regulations  or  other  laws  referred  to in  this  PARAGRAPH  11.B,
including, without limitation, the Environmental Laws, whether such violation or
alleged violation  occurred prior to (but only to the extent that such violation
or alleged  violation  arises from  Tenant's  early  occupancy  of the  Premises
pursuant to PARAGRAPH 40 below),  on, or after the  Commencement  Date;  (b) any
breach of the  provisions  of this  PARAGRAPH  11.B by Tenant or any of Tenant's
Parties;  or (c) any  Hazardous  Use on, about or from the Premises by Tenant or
any of Tenant's Parties of any Hazardous  Materials  (whether or not approved by
Landlord under this Lease), whether such Hazardous Use occurred prior to, on, or
after the Commencement  Date. The term "LOSSES" shall mean all claims,  demands,
expenses,  actions,  judgments,   damages  (whether  consequential,   direct  or
indirect,  known  or  unknown,  foreseen  or  unforeseen),   penalties,   fines,
liabilities,  losses of every kind and nature  (including,  without  limitation,
property  damage,  diminution in value of  Landlord's  interest in the Premises,
damages for the loss of  restriction  on use of any space or amenity  within the
Premises,  damages  arising from any adverse  impact on  marketing  space in the
Premises,  sums  paid in  settlement  of  claims  and  any  costs  and  expenses
associated  with  injury,  illness  or  death  to  or  of  any  person),  suits,
administrative  proceedings,  costs and fees,  including,  but not  limited  to,
reasonable  attorneys'  and  consultants'  fees and  expenses,  and the costs of
cleanup,  remediation,  removal and restoration,  that are in any way related to
any matter covered by the foregoing indemnity.

                                       35
<PAGE>
                           (ix) SURVIVAL.  The provisions of this PARAGRAPH 11.B
shall survive the expiration or earlier termination of this Lease.

                  C.  SPECIAL   PROVISIONS   RELATING  TO  THE  AMERICANS   WITH
DISABILITIES ACT OF 1990.

                           (i)  ALLOCATION  OF  RESPONSIBILITY  TO LANDLORD.  As
between Landlord and Tenant, Landlord shall be responsible for assuring that the
Common Area owned by Landlord and the  exterior of the Building  comply with the
requirements  of Title III of the Americans  with  Disabilities  Act of 1990 (42
U.S.C.  12181,  et seq.,  The Provisions  Governing  Public  Accommodations  and
Services  Operated  by  Private  Entities),   and  all  regulations  promulgated
thereunder,  and all  amendments,  revisions  or  modifications  thereto  now or
hereafter adopted or in effect in connection therewith (hereinafter collectively
referred to as the "ADA"),  and to take such  actions and make such  alterations
and improvements as are necessary for such compliance;  provided,  however, that
to the extent such  requirements  arise from the construction of any Alterations
to the  Premises  made by or on behalf of Tenant,  then as between  Landlord and
Tenant,  Tenant  shall be  responsible  that the Common Area  complies  with the
requirements of the ADA, and to take such actions and make such  alterations and
improvements as are necessary for such compliance.

                           (ii) ALLOCATION OF RESPONSIBILITY  TO TENANT.  Except
as  expressly  provided  in the Work  Letter,  as between  Landlord  and Tenant,
Tenant, at its sole cost and expense, shall be responsible for assuring that the
Premises  (and all  modifications  made by Tenant of access to the Premises from
the street),  and all  alterations and  improvements in the Premises  (including
without limitation the Tenant  Improvements),  and Tenant's use and occupancy of
the Premises,  and Tenant's  performance  of its  obligations  under this Lease,
comply with the  requirements of the ADA, and to take such actions and make such
alterations  and  improvements as are necessary for such  compliance;  provided,
however,  that Tenant shall not make any such alterations or improvements except
upon Landlord's prior written consent (which shall not be unreasonably withheld)
pursuant to the terms and conditions of this Lease.  If Tenant fails  diligently
to take such actions or make such  alterations or  improvements as are necessary
for such  compliance,  Landlord  may, but shall not be  obligated  to, take such
actions and make such

                                       36
<PAGE>
alterations  and  improvements  and may recover all of the costs and expenses of
such actions,  alterations  and  improvements  from Tenant as  Additional  Rent.
Tenant shall be entitled to utilize the Tenant Improvements Allowance to pay for
the  cost  of  any  improvements  required  by ADA  that  are  triggered  by the
construction of the Tenant Improvements.

                           (iii) GENERAL. Notwithstanding anything in this Lease
contained to the  contrary,  no act or omission of either  party,  including any
approval,  consent  or  acceptance  by it or  its  agents,  employees  or  other
representatives,  shall be deemed an  agreement,  acknowledgment,  warranty,  or
other  representation  by it that the other party has  complied  with the ADA as
provided under PARAGRAPHS  11.C.(I) or 11.C.(II) or that any action,  alteration
or  improvement  by it complies  or will  comply with the ADA as provided  under
PARAGRAPHS  11.C.(I) or  11.C.(II)  or  constitutes  a waiver by it of the other
party's  obligations  to  comply  with  the ADA  under  PARAGRAPHS  11.C.(I)  or
11.C.(II) of this Lease or otherwise. Any failure of either party to comply with
its  obligations  of the ADA under  PARAGRAPHS  11.C.(I) or 11.C.(II)  shall not
relieve  such  party  from any  obligations  under  this Lease or in the case of
Landlord's  failure  to  comply  under  PARAGRAPH  11.C.(I),  constitute  or  be
construed  as a  constructive  or other  eviction  of Tenant or  disturbance  of
Tenant's use and possession of the Premises.

                  D.  USE  AND  MAINTENANCE  OF  COMMON  AREA.  Tenant  and  its
employees and invitees shall have the non-exclusive right to use the Common Area
in common with other persons during the Term of this Lease, subject to the CC&Rs
and such  reasonable  rules and  regulations  as may from time to time be deemed
necessary or advisable in Landlord's  reasonable  discretion  for the proper and
efficient  operation  and  maintenance  of  the  Common  Area.  Such  rules  and
regulations may include,  among other things,  the hours during which the Common
Area shall be open for use.  Landlord shall maintain and operate the Common Area
from time to time owned by Landlord in good condition,  provided that any damage
thereto, other than normal wear and tear, occasioned by the negligence of Tenant
or its employees or invitees shall be paid by Tenant upon demand by Landlord.

         12.      QUIET ENJOYMENT.

                  Landlord  covenants  that Tenant,  upon  performing the terms,
conditions and covenants of this Lease, shall have quiet

                                       37
<PAGE>
and peaceful  possession of the Premises as against any person claiming the same
by, through or under Landlord.

         13.      ALTERATIONS.

                  A. ALTERATION  RIGHTS.  After the  Commencement  Date,  Tenant
shall not make or permit any Alterations  in, on or about the Premises,  without
the prior written consent of Landlord, and according to plans and specifications
approved  in  writing  by  Landlord,  which  consent  shall not be  unreasonably
withheld.  Notwithstanding  the  foregoing  Tenant shall not,  without the prior
written consent of Landlord, make any:

                           (i) Alterations to the exterior of the Building;

                           (ii) Alterations to the roof of the Building; and

                           (iii) Alterations  visible from outside the Building,
to which Landlord may withhold Landlord's consent on wholly aesthetic grounds.

Notwithstanding  anything to the contrary herein, Tenant may make alterations to
the  Premises  without  Landlord's  prior  consent (but with notice to Landlord)
provided  the  same do not  cost  in  excess  of  Twenty-Five  Thousand  Dollars
($25,000) in each instance (and that Tenant has not performed alterations to the
Premises  during  any  period  of twelve  (12)  consecutive  months  that in the
aggregate cost in excess of Seventy-Five  Thousand Dollars  ($75,000)),  are not
structural in nature,  do not affect Building  systems or the exterior of or the
roof of the Building, and are not visible from the outside of the Building.

                  B.  PERFORMANCE  OF  ALTERATIONS.  All  Alterations  shall  be
installed at Tenant's sole expense, in compliance with all applicable laws, by a
licensed  contractor,  shall be done in a good and workmanlike manner conforming
in quality and design with the Premises  existing as of the  Commencement  Date,
and shall not  diminish the value of either the  Building or the  Premises.  All
Alterations  made by Tenant  shall be and become the  property of Landlord  upon
installation  and shall not be deemed  Tenant's  Personal  Property,  and Tenant
shall not remove  any  Alterations  from the  Premises  unless  Tenant has first
obtained Landlord's written consent to such removal. Landlord may require Tenant
to remove,  at  Tenant's  expense,  any  Alterations  from the  Premises  at the
expiration or earlier termination of this Lease; provided,

                                       38
<PAGE>
however, that at the time any Alterations are constructed, Tenant shall have the
right to request  Landlord's  written  approval (which shall not be unreasonably
withheld  or  delayed)  that  Landlord  will not  require  the  removal  of such
Alterations   at  the   expiration  or  earlier   termination   of  this  Lease.
Notwithstanding  any  other  provision  of this  Lease,  Tenant  shall be solely
responsible for the maintenance and repair of any and all Alterations made by it
to the Premises. Tenant shall give Landlord written notice of Tenant's intention
to perform work on the Premises at least ten (10) days prior to the commencement
of such work to enable Landlord to post and record a Notice of Nonresponsibility
or other  notice  deemed  proper  before  the  commencement  of any  such  work.
Notwithstanding  anything to the contrary contained herein,  Tenant shall not be
required to remove (i) any of the initial Tenant Improvements  constructed by or
on behalf of Tenant,  and (ii) any  alterations,  additions or improvements  for
which Tenant has  obtained  Landlord's  consent,  but only if at the time Tenant
requested  Landlord's  consent  thereto,  Tenant gave Landlord a written request
that  Landlord  identify in writing  which,  if any,  of  Tenant's  alterations,
additions or improvements must in Landlord's sole discretion be removed upon the
expiration  of the Term,  and Landlord did not notify  Tenant within twenty (20)
days after Landlord's receipt of such notice that such alterations, additions or
improvements must be removed upon the expiration of the Term.

         14.      SURRENDER OF THE PREMISES.

                  Upon the expiration or earlier termination of the Term, Tenant
shall  surrender  the Premises to Landlord in its  condition  existing as of the
date of  substantial  completion of the  Improvements,  normal wear and tear and
fire or other  casualty  excepted,  with all interior walls repaired if damaged,
all broken,  marred or  nonconforming  acoustical  ceiling tiles  replaced,  all
windows washed,  the plumbing and electrical  systems and lighting in good order
and repair,  including  replacement  of any burned out or broken  light bulbs or
ballasts,  the HVAC equipment  serviced and repaired by a reputable and licensed
service firm,  and all floors  cleaned,  all to the reasonable  satisfaction  of
Landlord.  Tenant shall  remove from the  Premises  all of Tenant's  Alterations
required to be removed  pursuant to PARAGRAPH  13, and all of Tenant's  Personal
Property,  and repair any damage and perform any restoration work caused by such
removal.  If Tenant  fails to remove  such  Alterations  and  Tenant's  Personal
Property, and such failure continues after the

                                       39
<PAGE>
expiration  or earlier  termination  of this Lease,  Landlord may, to the extent
permitted by law, retain such  Alterations and Tenant's  Property and all rights
of Tenant  with  respect to it shall  cease,  or  Landlord  may place all or any
portion of such Alterations and Tenant's Property in public storage for Tenant's
account.  Tenant  shall be liable to  Landlord  for costs of removal of any such
Alterations and Tenant's Personal Property and storage and transportation  costs
of same,  and the cost of repairing and  restoring  the Premises,  together with
interest at the Interest Rate from the date of expenditure  by Landlord.  If the
Premises are not so surrendered at the expiration or earlier termination of this
Lease, Tenant shall indemnify Landlord and Landlord's Agents against all loss or
liability,  including reasonable attorneys' fees and costs, resulting from delay
by Tenant in so surrendering the Premises.

                  Normal wear and tear, for the purposes of this Lease, shall be
construed  to mean wear and tear  caused  to the  Premises  by a  natural  aging
process  which  occurs in spite of prudent  application  of good  standards  for
maintenance,  repair and janitorial practices.  It is not intended, nor shall it
be construed,  to include items of neglected or deferred maintenance which would
have or  should  have  been  attended  to  during  the Term of the Lease if good
standards  had been  applied to properly  maintain  and keep the Premises at all
times in good condition and repair.

         15.      IMPOSITIONS AND REAL PROPERTY TAXES.

                  A. PAYMENT BY TENANT.  Tenant shall pay all Impositions  prior
to  delinquency.  If billed  directly,  Tenant  shall pay such  Impositions  and
concurrently present to Landlord  satisfactory evidence of such payments. If any
Impositions  are billed to Landlord  or  included in bills to Landlord  for Real
Property Taxes, then Tenant shall pay to Landlord all such amounts not less than
five  (5) days  prior  to the date  such  Imposition  would  be  delinquent.  If
applicable law prohibits Tenant from reimbursing Landlord for an Imposition, but
Landlord  may  lawfully  increase  the Monthly  Rent to account  for  Landlord's
payment of such  Imposition,  the  Monthly  Rent  payable to  Landlord  shall be
increased so that the amount of such increased  Monthly Rent,  together with any
accompanying increases in the Real Property Taxes payable by Tenant with respect
to such  Imposition,  are  sufficient to net to Landlord the same return without
reimbursement of such Imposition as would have been received by

                                       40
<PAGE>
Landlord with reimbursement of such Imposition.  In addition, on or before April
10 and  December 10 of each year of the Term,  Tenant  shall pay directly to the
San Mateo County  assessor the Real Property Taxes for the Premises as set forth
on the assessor's tax bill for the Premises. If, however, the Premises are not a
separate parcel for tax purposes but constitute a portion of a larger tax parcel
or parcels,  the Real Property Taxes payable by Tenant under this Lease shall be
a  percentage  of the Real  Property  Taxes  payable for such parcel or parcels,
which  percentage  shall be  determined  by dividing  the  Rentable  Area of the
Premises by the total  Rentable  Area of all buildings on such parcel or parcels
and multiplying the result by 100, which Real Property Taxes shall be payable by
Tenant to Landlord monthly as part of the Common Area Maintenance Costs. Tenant,
at its  cost,  shall  have  the  right  at any  time to seek a  reduction  in or
otherwise contest any Real Property Taxes for which it is obligated to reimburse
Landlord  pursuant to this  PARAGRAPH  15, by action or  proceeding  against the
entity  with  authority  to  assess or impose  the same.  Landlord  shall not be
required  to join in any  proceeding  or action  brought  by Tenant  unless  the
provisions of applicable  regulations  require that such proceeding or action be
brought by or in the name of  Landlord,  in which event  Landlord  shall join in
such  proceeding  or  action  or permit it to be  brought  in  Landlord's  name,
provided that Tenant shall protect,  indemnify,  defend,  and hold Landlord free
and harmless from and against any and all loss,  liability,  cost, damage, claim
or expense in connection with such proceeding or contest. Tenant shall continue,
during the pendency of such proceeding or action, to pay the Real Property Taxes
due as  determined  by  landlord  pursuant  to this  PARAGRAPH  15. If Tenant is
successful in such action or proceeding,  Landlord shall reimburse to Tenant its
prorata share of the reduction in Real Property Taxes realized by Tenant in such
contest or  proceeding  within ten (10) days after the amount of such  reduction
has been determined.


                           (i)  TAX  PARCELS.  If  Landlord  determines  in  its
reasonable  discretion that the  configuration of tax parcels within the Project
(including  without limitation the tax parcel on which the Premises is situated)
causes the allocation of Real Property Taxes between the affected tax parcels to
be unfair or inequitable,  Landlord reserves the right to internally  reallocate
the Real Property Taxes  assessed  against such affected tax parcels in a manner
that reasonably  addresses such unfairness or inequity.  If Landlord effects any
such reallocation, then the

                                       41
<PAGE>
Real  Property  Taxes  payable by Tenant  under  this Lease  shall be those Real
Property Taxes allocated to the Premises pursuant to this PARAGRAPH 15.A.(I).

                           (ii) PAYMENT.  Promptly following payment of the Real
Property  Taxes,  Tenant shall provide  Landlord with copies of paid receipts or
other  documentary  evidence  that the Real  Property  Taxes  have  been paid by
Tenant. If Tenant fails to pay the Real Property Taxes on or before April 10 and
December 10, respectively,  or if Tenant fails to pay its share of Real Property
Taxes as part of the Common Area Maintenance Costs, Tenant shall pay to Landlord
any penalty  incurred by such late  payment.  In addition,  Tenant shall pay any
Real Property Tax not included  within the county tax assessor's tax bill within
ten (10) days after being billed for same by Landlord.  The foregoing  dates are
based on the dates established by the county as the dates on which Real Property
Taxes become delinquent if not paid. If such delinquency dates change, the dates
on which Tenant must pay the Real  Property  Taxes for the Premises  shall be at
least ten (10) days  prior to the new  delinquency  dates.  Assessments,  taxes,
fees,  levies  and  charges  may be imposed by  governmental  agencies  for such
purposes as fire protection,  street,  sidewalk,  road, utility construction and
maintenance,  refuse  removal  and for  other  governmental  services  which may
formerly have been provided  without charge to property owners or occupants.  It
is the intention of the parties that all new and increased  assessments,  taxes,
fees,  levies and  charges  are to be  included  within the  definition  of Real
Property Taxes for the purposes of this Lease.

                  B. TAXES ON TENANT IMPROVEMENTS AND PERSONAL PROPERTY.  Tenant
shall  pay any  increase  in Real  Property  Taxes  resulting  from  any and all
Alterations  and Tenant  Improvements  of any kind  whatsoever  placed in, on or
about the Premises  for the benefit of, at the request of, or by Tenant.  Tenant
shall pay prior to delinquency  all taxes  assessed or levied  against  Tenant's
Personal  Property in, on or about the  Premises or  elsewhere.  When  possible,
Tenant  shall cause its Personal  Property to be assessed and billed  separately
from the Premises and the real property or Personal Property of Landlord.

                  C.  PRORATION.  Tenant's  liability to pay Real Property Taxes
shall be prorated on the basis of a 360-day  year to account for any  fractional
portion of a fiscal tax year included at the  commencement  or expiration of the
Term. With

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<PAGE>
respect to any  assessments  which may be levied against or upon the Premises or
all or any portion of the Project,  or which under the laws then in force may be
evidenced by improvements or other bonds or may be paid in annual  installments,
only the amount of such annual  installment (with appropriate  proration for any
partial year) and interest due thereon shall be included  within the computation
of the annual Real Property Taxes levied against the Premises or such portion of
the Project, as applicable.

         16.      UTILITIES AND SERVICES.

                  Tenant  shall be  responsible  for and shall pay  promptly all
charges for water,  gas,  electricity,  telephone,  refuse  pick-up,  janitorial
service and all other utilities, materials and services furnished directly to or
used by Tenant in, on or about the Premises  during the Term,  together with any
taxes thereon. If any utility,  material or service is not separately charged or
metered to any portion of the Premises, Tenant shall pay to Landlord, within ten
(10) days after written  demand  therefor,  Tenant's pro rata share of the total
cost thereof as may be determined by Landlord.  Landlord  shall not be liable in
damages or otherwise for any failure or  interruption  of any utility service or
other service  furnished to the Premises,  except that  resulting from the gross
negligence  or willful  misconduct  of Landlord.  Tenant shall have the right to
contract directly with vendors for janitorial and maintenance services, provided
such vendors must be approved in advance by Landlord,  which  approval shall not
be unreasonably  withheld; and provided further, that Tenant shall have no right
to contract with any vendor to maintain the Building's HVAC system,  which shall
be the sole responsibility of Landlord as set forth in PARAGRAPH 17.A.

         17.      REPAIR AND MAINTENANCE.

                  A. LANDLORD'S OBLIGATIONS.  Landlord shall keep in good order,
condition  and repair the  structural  parts of the Building,  which  structural
parts consist only of the foundation, subflooring, exterior walls (excluding the
interior  of all walls and the  exterior  and  interior of all  windows,  doors,
ceilings,  and plate  glass),  and roof of the  Building,  and all  plumbing and
electrical  facilities  leading up to (but not  situated  within) the  Building,
except for any  damage  thereto  caused by the  negligence  or  willful  acts or
omissions of Tenant or of Tenant's agents,  employees or invitees,  or by reason
of the failure of Tenant to perform or comply  with any terms of this Lease,  or
caused by

                                       43
<PAGE>
Alterations made by Tenant or by Tenant's agents,  employees or contractors.  It
is an express  condition  precedent to all obligations of Landlord to repair and
maintain that Tenant shall have  notified  Landlord of the need for such repairs
or  maintenance.  Tenant waives the  provisions of Sections 1941 and 1942 of the
California Civil Code and any similar or successor law regarding  Tenant's right
to make  repairs and deduct the expenses of such repairs from the Rent due under
this Lease. Landlord shall keep in good order, condition, repair and maintenance
the  Building's  HVAC  system  and  roof,  and  shall  maintain  an HVAC  system
preventive maintenance service contract from a qualified vendor at a competitive
price for the purpose of  maintaining  the  Building's  HVAC system,  and a roof
maintenance  service  contract  from a  qualified  vendor  for  the  purpose  of
maintaining the Building's roof. Landlord shall determine in its sole discretion
whether any such vendor is qualified.  Any and all costs of any  maintenance  or
repair of the HVAC system or the roof (including  without limitation the cost of
maintaining HVAC system preventative  maintenance contracts and roof maintenance
service  contracts)  shall be  included  in the Common  Area  Maintenance  Costs
payable  by Tenant  for the year in which such cost is  incurred.  Landlord  may
elect, in its sole  discretion,  to paint the exterior of the Building and/or to
replace or perform  capital  improvements  to any area or aspect of the Building
which Landlord is required keep in good order,  condition and repair. Subject to
the provisions of PARAGRAPH  17.A(I)  below,  if Landlord  decides,  in its sole
discretion,  to  replace  the  roof  of  the  Building  or  make  other  capital
improvements  or  replacements  to the Building or its systems  during the Term,
then the cost of so replacing the roof or performing such replacement,  together
with interest at the Interest Rate, shall be amortized on a straight-line  basis
over the  useful  life of the roof or capital  improvement  or  replacement  (as
determined  by Landlord in its sole  discretion)  (the "USEFUL  LIFE"),  and the
entire  amount of such  amortized  costs and  interest  allocable to each month,
multiplied by Tenant's  Building Share,  shall be included in the monthly Common
Area  Maintenance  Costs  payable by Tenant  during the entire period over which
such costs are amortized,  until Tenant has paid to Landlord that  proportion of
the  total  amount of such  amortized  costs  equal to (a) the  number of months
remaining  during the Term as of the date such roof  replacement  was completed,
divided  by (b) the  number of  months of the  Useful  Life,  multiplied  by (c)
Tenant's  Building  Share.  For the  purposes of example  only and not by way of
limitation,  if the Building's roof is replaced  twenty-four  (24) months before
the end of the Term, at a cost of

                                       44
<PAGE>
Fifty Thousand Dollars  ($50,000.00),  and the Useful Life is one hundred twenty
(120) months,  then (a) the cost of such  replacement  shall be amortized at the
rate of Four Hundred  Sixteen and 67/100ths  Dollars  ($416.67) per month,  with
interest at the Interest  Rate, and (b) the amount to be included in the monthly
Common Area  Maintenance  Costs payable  solely by Tenant for the balance of the
Term shall equal Two Hundred  Ninety-One and 67/100ths Dollars  ($291.67),  with
interest  at the  Interest  Rate,  until  Tenant  has paid to  Landlord  a total
aggregate amount of Seven Thousand Dollars  ($7,000.00),  together with interest
at the Interest Rate, towards such amortized costs (i.e., Fifty Thousand Dollars
($50,000.00)  multiplied  by  [Twenty-Four  (24)  months  divided by One Hundred
Twenty (120) months]) multiplied by Tenant's Building Share. If Tenant exercises
the Option to Extend,  the total length of the Term (i.e.,  the initial Term and
the  Extended  Term) shall be utilized to calculate  the maximum  amount of such
amortized costs that shall be includable in the monthly Common Area  Maintenance
Costs payable solely by Tenant pursuant to this PARAGRAPH 17.A.

                  It is  the  express  intent  of the  parties  that  except  as
specifically set forth in this PARAGRAPH 17.A, Landlord shall have no obligation
whatsoever to repair or maintain the Premises or the  Building,  and that Tenant
shall be responsible  for performing all repair,  operation,  and maintenance of
the Premises  except for those tasks  specifically  described in this  PARAGRAPH
17.A. If Tenant gives Landlord written notice ("DEFECT  NOTICE") that there is a
defect or other problem with the Capital  Improvements  that may be covered by a
warranty  issued by  Contractor  (as defined in EXHIBIT B) or any  subcontractor
that  performed any of the Capital  Improvements,  Landlord  shall (i) assign to
Tenant  the  benefit  of those  warranties  (if any) held by  Landlord  that are
applicable  to the defects  described in the Defect  Notice,  (ii) at no cost or
expense to Landlord,  take such actions as may be reasonably requested by Tenant
to assist Tenant's efforts to enforce any such warranties.

                  It is also the express  intent of the parties that if Landlord
for any reason  fails to  complete  all of the Capital  Improvements  before the
Commencement  Date,  Landlord  shall  complete the  construction  of the Capital
Improvements  at its sole cost and  expense,  and shall have no right to include
the cost of completing the Capital Improvements in Common Area Maintenance Costs
or  otherwise  seek  reimbursement  from Tenant for the cost of  completing  the
Capital Improvements.

                                       45
<PAGE>
                           (i) The parties acknowledge and agree that as part of
the Capital Improvements, Landlord will install a new roof on the Building, that
the roof will be  covered  by one or more  warranties  (collectively,  the "Roof
Warranties"),  and that the roof has an estimated useful life of ten (10) years.
Notwithstanding anything to the contrary set forth above in this PARAGRAPH 17.A,
if  Landlord  elects to replace the roof of the  Building  within ten (10) years
from the date such roof was originally  installed,  and the cost of so replacing
the roof exceeds any amounts covered or paid for under the Roof Warranties, then
(i) the amount of any such excess shall be collectively  called the "Excess Roof
Replacement  Costs";  (ii)  the  cost  of  the  initial  roof  installation  (as
reasonably  determined by Landlord) shall be amortized on a straight-line basis,
over the ten (10) year useful life of such roof,  determined  as of the date the
roof  replacement  commences,  and the  unamortized  portion of such costs shall
hereafter be called the  "Unamortized  Roof Costs";  and (iii) only those Excess
Roof Replacement  Costs that exceed the Unamortized Roof Costs (if any) shall be
includable  in Common  Area  Maintenance  Costs in the manner set forth above in
this PARAGRAPH 17.A.

                  B. TENANT'S OBLIGATIONS.  Tenant shall at all times and at its
sole cost and expense  clean,  keep and  maintain in good order,  condition  and
repair (and  replace,  if  necessary)  every part of the  Premises  which is not
within  Landlord's  obligation  pursuant to PARAGRAPH 17.A.  Tenant's repair and
maintenance  obligations  shall  include  without  limitation  all  plumbing and
electrical facilities situated within the Premises, fixtures, interior walls and
ceiling,  floors,  windows,  window  frames,  doors,  entrances,   plate  glass,
showcases,  skylights,  all  lighting  fixtures,  lamps,  fans  and any  exhaust
equipment and systems,  all  mechanical  systems (but not the HVAC system),  any
automatic fire extinguisher  equipment within the Premises, all security systems
and alarms,  all  electrical  motors and all other  appliances  and equipment of
every kind and nature located in, upon or about the Premises.  Tenant shall also
be responsible for all pest control within the Premises.

                  C. CONDITIONS APPLICABLE TO REPAIRS. All repairs, replacements
and reconstruction made by or on behalf of Tenant or any person claiming through
or under  Tenant  shall be made and  performed  (i) at  Tenant's  sole  cost and
expense, in a good and workmanlike manner and at such time and in such manner as
Landlord may reasonably designate, (ii) by contractors approved

                                       46
<PAGE>
in  advance  by   Landlord,   (iii)  so  that  the  repairs,   replacements   or
reconstruction  shall be at least  equal in  quality,  value and  utility to the
original  work  or  installation,   (iv)  in  accordance  with  such  reasonable
requirements  as Landlord may impose with  respect to insurance  and bonds to be
obtained by Tenant in connection  with the proposed work  (provided  that Tenant
shall  not be  required  to post a bond if the  total  cost of any such  repair,
replacement or reconstruction work is equal to or less than Twenty-Five Thousand
Dollars ($25,000.00)),  and (v) in accordance with any rules and regulations for
the Building as may be adopted by Landlord  from time to time and in  accordance
with all applicable  laws and  regulations of  governmental  authorities  having
jurisdiction over the Premises.

                  D.  LANDLORD'S  RIGHTS.  If Tenant  fails to perform  Tenant's
obligations  under  PARAGRAPH  17.B,  Landlord may in its sole  discretion  give
Tenant  notice  of  such  work  as  is  reasonably   required  to  fulfill  such
obligations.  If Tenant fails to commence the work within thirty (30) days after
receipt of such notice and  diligently  prosecute the work to  completion,  then
Landlord shall have the right (but not the obligation) to do such acts or expend
such funds at the expense of Tenant as are  reasonably  required to perform such
work.  Any amount so expended  by  Landlord  shall be paid by Tenant to Landlord
promptly after demand with interest at the Interest Rate. Landlord shall have no
liability to Tenant for any damage to, or interference with Tenant's use of, the
Premises, or inconvenience to Tenant as a result of performing any such work.

                  E. COMPLIANCE WITH GOVERNMENTAL REGULATIONS.  Tenant shall, at
its sole cost and expense,  comply with,  including  the making by Tenant of any
Alteration to the Premises,  all present and future  regulations,  rules,  laws,
ordinances, and requirements of all governmental authorities (including, without
limitation  state,   municipal,   county  and  federal   governments  and  their
departments,   bureaus,  boards  and  officials)  applicable  to  the  Premises.
Notwithstanding  the  foregoing  or anything to the  contrary  contained in this
Lease,  Tenant shall not be  responsible  for compliance  with any  regulations,
rules, laws, ordinances,  or requirements of all governmental  authorities where
such compliance is not related specifically to Tenant's use and occupancy of the
Premises. For example, if any governmental authority should require the Building
or the Premises to be structurally  strengthened  against earthquake,  or should
require the removal of asbestos from the Premises and such measures are

                                       47
<PAGE>
imposed as a general  requirement  applicable  to all  tenants  rather than as a
condition to Tenant's specific use or occupancy of the Premises, such work shall
be  performed by and at the sole cost of Landlord,  subject to  contribution  by
Tenant to the extent included in Common Area Maintenance Costs.

         18.      LIENS.

                  Tenant shall keep the Building and the Premises  free from any
liens arising out of any work  performed,  materials  furnished,  or obligations
incurred by or on behalf of Tenant,  and free from any liens  arising out of any
effort by Tenant to reduce or contest  Impositions,  or Tenant's exercise of its
rights under Paragraph 39 below, and Tenant hereby agrees to indemnify,  defend,
protect and hold Landlord and  Landlord's  Agents  harmless from and against any
and all loss, claim, damage, liability,  cost and expense,  including attorneys'
fees and costs,  in connection  with or arising out of any such lien or claim of
lien.  Tenant  shall  cause any such lien  imposed to be  released  of record by
payment or posting of a proper bond  acceptable to Landlord within ten (10) days
after written request by Landlord.  Tenant shall give Landlord written notice of
Tenant's  intention to perform  work on the  Premises  which might result in any
claim of lien at least ten (10) days prior to the  commencement  of such work to
enable  Landlord  to post and record a Notice of  Nonresponsibility  or any such
other notice(s) as Landlord may deem  appropriate.  If Tenant fails to so remove
any such lien within the prescribed  ten 10-day period,  then Landlord may do so
at Tenant's  expense and Tenant shall  reimburse  Landlord for such amounts upon
demand.  Such  reimbursement  shall  include  all  costs  incurred  by  Landlord
including  Landlord's  reasonable  attorneys' fees with interest  thereon at the
Interest Rate.

         19.      LANDLORD'S RIGHT TO ENTER THE PREMISES.

                  Tenant shall permit  Landlord and  Landlord's  Agents to enter
the  Premises  at all  reasonable  times  with  reasonable  notice,  except  for
emergencies  in which case no notice shall be required,  to inspect the same, to
post  Notices of  Nonresponsibility  and similar  notices,  and real estate "For
Sale" signs,  to show the  Premises to  interested  parties such as  prospective
lenders and  purchasers,  to make  necessary  repairs,  to discharge  Landlord's
obligations under this Lease, to discharge Tenant's obligations under this Lease
when Tenant has failed to do so within a reasonable  time after  written  notice
from

                                       48
<PAGE>
Landlord,  and to place upon the Building ordinary "For Lease" signs and to show
the Premises to prospective  tenants  (provided that so long as Tenant is not in
default under any term or condition of this Lease after notice from Landlord and
the  expiration of any applicable  cure period  granted by this Lease,  Landlord
shall only be permitted to show the Premises to  prospective  tenants during the
last twelve (12) months of the Term).

         20.      SIGNS.

                  Subject to Tenant  obtaining all necessary  approvals from the
City of Redwood City and subject to Landlord's  review and approval of plans and
specifications for any proposed signage,  which approval may be withheld only in
Landlord's  commercially  reasonable  judgment,  Tenant shall have the exclusive
right to install  identification  signage  with its name and logo near the north
entry on the exterior of the Building in the location depicted on EXHIBIT B-1 so
long as such signage complies with Landlord's project sign program. Tenant shall
have no right to maintain any Tenant  identification  sign in any other location
in, on or about the  Building or the Premises and shall not display or erect any
other Tenant  identification sign, display or other advertising material that is
visible  from the  exterior of the  Building.  Any changes to the size,  design,
color or other  physical  aspects of Tenant's  identification  sign(s)  shall be
subject  to  the  Landlord's  prior  written   approval,   which  shall  not  be
unreasonably  withheld,  and any  appropriate  municipal  or other  governmental
approvals. The cost of Tenant's sign(s) and their installation,  maintenance and
removal shall be Tenant's sole cost and expense. If Tenant fails to maintain its
sign(s),  or, if Tenant  fails to remove its sign(s)  upon  termination  of this
Lease,  Landlord  may do so at  Tenant's  expense  and the  amounts  expended by
Landlord  in doing so shall be  immediately  payable  by Tenant to  Landlord  as
Additional Rent.

         21.      INSURANCE.

                  A. INDEMNIFICATION.  Tenant shall indemnify,  defend,  protect
and hold  Landlord  harmless  of and from any and all  loss,  liens,  liability,
claims, causes of action,  damage,  injury, cost or expense arising out of or in
connection with, or related to (i) the negligent making of Alterations,  or (ii)
injury to or death of  persons  or damage to  property  occurring  or  resulting
directly or indirectly from: (A) the use or occupancy of, or the

                                       49
<PAGE>
conduct of business in, the Premises;  (B) any other  occurrence or condition in
or on the  Premises;  and  (C)  acts  or  omissions  of  Tenant,  its  officers,
directors,  agents, employees,  invitees or licensees in or about any portion of
the Project.  Tenant's indemnity obligation includes reasonable  attorneys' fees
and  costs,  investigation  costs and all other  reasonable  costs and  expenses
incurred by  Landlord.  If Landlord  reasonably  disapproves  the legal  counsel
proposed by Tenant for the defense of any claim indemnified  against  hereunder,
Landlord shall have the right to appoint its own legal  counsel,  the reasonable
fees,  costs  and  expenses  of which  shall  be  included  as part of  Tenant's
indemnity obligation hereunder. The indemnification  contained in this PARAGRAPH
21.A shall extend to the officers, directors, shareholders, partners, employees,
agents and representatives of Landlord. The obligations assumed by Tenant herein
shall survive this Lease. Notwithstanding the foregoing, Landlord shall have the
right, in its sole  discretion,  but without being required to do so, to defend,
adjust,  settle or  compromise  any claim,  obligation,  debt,  demand,  suit or
judgment  against  Landlord  arising  out of or in  connection  with the matters
covered by the foregoing  indemnity and, in such event,  Tenant shall  reimburse
Landlord  for all  reasonable  charges  and  expenses  incurred  by  Landlord in
connection therewith,  including reasonable attorneys' fees; provided,  however,
that Landlord shall not undertake any unilateral action or settlement so long as
Tenant or an insurance company,  at its or their sole expense,  is contesting in
good faith,  diligently  and with  continuity  such claim,  action,  obligation,
demand or suit, and so long as such claim,  action,  obligation,  demand or suit
does not have or  threaten  to have a  material  adverse  impact  on  Landlord's
assets, reputation or business affairs.

                  Notwithstanding  anything to the  contrary  in this  PARAGRAPH
21.A:

                           (i) Tenant shall not be required to indemnify, defend
or hold Landlord harmless from or against loss, liens, liability, claims, causes
of action, damage, injury, cost or expense to the extent arising out of: (a) the
breach by Landlord  or  Landlord's  Agents of any  covenant,  representation  or
warranty  under this  Lease,  or (b) any  negligence  or willful  misconduct  of
Landlord or Landlord's Agents.

                           (ii) Landlord shall  indemnify,  defend,  protect and
hold Tenant harmless of and from any and all loss, liens,

                                       50
<PAGE>
liability, claims, causes of action, damage, injury, cost or expense arising out
of or in  connection  with,  or related to the acts or  omissions of Landlord or
Landlord's Agents, except to the extent arising out of: (a) the breach by Tenant
or Tenant's  officers,  directors,  agents,  employees,  invitees,  licensees or
contractors of any covenant, representation or warranty under this Lease, or (b)
any negligence or willful misconduct of Tenant or Tenant's officers,  directors,
agents,   employees,    invitees,    licensees   or   contractors.    Landlord's
indemnification shall extend to the officers, directors, shareholders, partners,
employees, agents and representatives of Tenant.

                  B. TENANT'S INSURANCE. Tenant agrees to maintain in full force
and effect at all times during the Term,  at its sole cost and expense,  for the
protection of Tenant and Landlord,  as their  interests may appear,  policies of
insurance  issued by a  responsible  carrier or carriers  acceptable to Landlord
which afford the following coverages:

                           (i)  Commercial  general  liability  insurance  in an
amount not less than Three Million  Dollars  ($3,000,000)  combined single limit
for both bodily  injury and property  damage,  with a limit of not less than One
Million  Dollars  ($1,000,000)  per  occurrence  and not less  than Two  Million
Dollars  ($2,000,000)  in excess  liability  coverage,  which  includes  blanket
contractual  liability broad form property damage,  personal  injury,  completed
operations,  and  products  liability,  which  policy  shall name  Landlord  and
Landlord's Agents as additional insureds and shall contain a provision that "the
insurance provided Landlord hereunder shall be primary and non-contributing with
any other  insurance  available to Landlord  with  respect to any damage,  loss,
liability or expense covered by Tenant's  indemnity  obligations under PARAGRAPH
21.A of the Lease."

                           (ii) Causes of loss-special  form property  insurance
(including,   without  limitation,   vandalism,  malicious  mischief,  inflation
endorsement,  and sprinkler  leakage  endorsement) on Tenant's Personal Property
located on or in the Premises. Such insurance shall be in the full amount of the
replacement  cost,  as the same may from  time to time  increase  as a result of
inflation or otherwise. As long as this Lease is in effect, the proceeds of such
policy  shall be used for the repair and  replacement  of such items so insured.
Landlord shall have no interest in the insurance  proceeds on Tenant's  Personal
Property. Notwithstanding the foregoing, Tenant shall have the right, at

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<PAGE>
its  election,  to  self-insure  with  respect to any loss or damage to Tenant's
Personal Property.

                           (iii) Boiler and machinery insurance, including steam
pipes, pressure pipes,  condensation return pipes and other pressure vessels and
HVAC  equipment,  including  miscellaneous  electrical  apparatus,  in an amount
satisfactory to Landlord.

                           (iv) Workers compensation insurance in the manner and
to the extent  required by applicable  law and with limits of liability not less
than the minimum required under applicable law, covering all employees of Tenant
having any duties or responsibilities in or about the Premises.

Any  policy  required  to be  maintained  by  Tenant  under  this  Lease  may be
maintained  under a so-called  "blanket  policy"  insuring  other parties and/or
other  locations,  so long as the  amount  of  insurance  and  type of  coverage
required  to be  provided  hereunder  is  not  thereby  diminished,  changed  or
adversely affected.

                  C. BUILDING INSURANCE. During the Term Landlord shall maintain
causes of loss-special form property insurance (including inflation endorsement,
sprinkler leakage endorsement,  and, at Landlord's option,  earthquake and flood
coverage; provided, however, that Landlord shall not be entitled to pass through
to Tenant the cost of earthquake  insurance unless such insurance is obtained at
commercially  reasonable  rates)  on the  Building,  excluding  coverage  of all
Tenant's  Personal  Property  located on or in the  Premises,  but including the
Tenant  Improvements;  such insurance shall be for the full replacement value of
the Building, if such full replacement coverage is available from insurers,  and
at  commercially  reasonable  rates,  reasonably  acceptable  to Landlord.  Such
insurance  shall also include  insurance  against loss of rents,  including,  at
Landlord's option,  coverage for earthquake and flood, in an amount equal to the
Monthly Rent and  Additional  Rent,  and any other sums payable under the Lease,
for a period of at least twelve (12) months commencing on the date of loss. Such
insurance  shall name  Landlord  and  Landlord's  Agents as named  insureds  and
include a lender's loss payable  endorsement in favor of Landlord's lender (Form
438 BFU Endorsement).  Tenant shall reimburse  Landlord  monthly,  as Additional
Rent, for Tenant's  Building  Share of one-twelfth  (12th) of the annual cost of
such insurance on the first day of each calendar month of the Term, prorated for
any partial month, or on such other periodic basis as Landlord shall

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<PAGE>
elect. If the insurance  premiums are increased after the Commencement  Date for
any reason,  including without limitation due to an increase in the value of the
Building or its replacement  cost,  Tenant shall pay Tenant's  Building Share of
such  increase  within  ten (10)  days of  notice  of such  increase;  provided,
however, that if any increase in such insurance premiums is due to any action or
failure to act of  Tenant,  including  without  limitation  Tenant's  use of the
Premises or any improvements  installed by Tenant at the Premises,  Tenant shall
pay the entire  amount of such  increase  within ten (10) days of notice of such
increase. Landlord may, in its sole discretion,  maintain the insurance coverage
described  in  this  PARAGRAPH  21.C as part  of an  umbrella  insurance  policy
covering other properties owned by Landlord.

                  D.  INCREASED  COVERAGE.  Upon demand,  Tenant  shall  provide
Landlord, at Tenant's expense, with such increased amount of existing insurance,
and such other  insurance  as  Landlord  or  Landlord's  lender  may  reasonably
require,  consistent  with prudent  industry  practice,  to afford  Landlord and
Landlord's lender adequate protection.

                  E.  FAILURE  TO  MAINTAIN.  If Tenant  fails to  maintain  any
insurance  coverage that Tenant is required to maintain under this PARAGRAPH 21,
and  Landlord  incurs any  liability  to its  insurance  carrier  arising out of
Tenant's failure to so maintain such insurance  coverage,  then any and all loss
or damage  Landlord shall sustain by reason thereof,  including  attorneys' fees
and costs, shall be borne by Tenant and shall be immediately paid by Tenant upon
its receipt of a bill therefor and evidence of such loss.  Nothing  contained in
this  PARAGRAPH  21.E shall be deemed to limit or affect any other  remedies  or
rights  available to Landlord under this Lease that arise from Tenant's  failure
to so maintain such insurance coverage.

                  F. INSURANCE  REQUIREMENTS.  All insurance  shall be in a form
satisfactory  to Landlord and shall be carried in companies  that have a general
policy holder's  rating of not less than "A" and a financial  rating of not less
than Class "X" in the most  current  edition of BEST'S  INSURANCE  REPORTS;  and
shall provide that such policies shall not be subject to material  alteration or
cancellation  except  after at least thirty (30) days' prior  written  notice to
Landlord.  The  policy or  policies,  or duly  executed  certificates  for them,
together with satisfactory  evidence of payment of the premiums thereon shall be
deposited

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<PAGE>
with Landlord prior to the Commencement Date, and upon renewal of such policies,
not less than  thirty  (30)  days  prior to the  expiration  of the term of such
coverage.  If Tenant fails to procure and maintain the  insurance it is required
to maintain under this PARAGRAPH 21, Landlord may, but shall not be required to,
order such  insurance at Tenant's  expense and Tenant shall  reimburse  Landlord
therefor.  Such  reimbursement  shall include all costs  incurred by Landlord in
obtaining such insurance including Landlord's  reasonable  attorneys' fees, with
interest thereon at the Interest Rate.

                  G.  WAIVER  AND  RELEASE.  Except  to  the  extent  due to the
negligence or willful  misconduct of Landlord,  Landlord  shall not be liable to
Tenant or Tenant's employees, agents, contractors, licenses or invitees for, and
Tenant waives as against and releases  Landlord and Landlord's  Agents from, all
claims for loss or damage to any  property  or  injury,  illness or death of any
person in, upon or about the Premises  and/or any other  portion of the Project,
arising at any time and from any cause whatsoever  (including without limitation
any claim caused in whole or in part by the act,  omission,  or neglect of other
tenants,  contractors,  licensees, invitees or other occupants of the Project or
their  agents  or  employees;  and  any  claim  arising  from  any  construction
activities  taking place in, upon or about the Premises and/or any other portion
of the  Project).  Landlord  and  Landlord's  Agents shall not be liable for any
latent defect in the Premises.

         22.      WAIVER OF SUBROGATION.

                  Landlord  and Tenant each hereby  waive all rights of recovery
against the other on account of loss or damage  occasioned by such waiving party
to its property or the property of others under its control,  to the extent that
such loss or damage would be covered by any causes of  loss-special  form policy
of  insurance  or  its  equivalent  required  to be or  actually  carried  under
PARAGRAPH 21. Tenant and Landlord  shall,  upon obtaining  policies of insurance
required  hereunder,  give notice to the  insurance  carrier that the  foregoing
mutual waiver of  subrogation is contained in this Lease and Tenant and Landlord
shall cause each  insurance  policy  obtained by such party to provide  that the
insurance  company  waives all right of recovery by way of  subrogation  against
either Landlord or Tenant in connection with any damage covered by such policy.

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<PAGE>
         23.      DAMAGE OR DESTRUCTION.

                  A. LANDLORD'S OBLIGATION TO REBUILD. If all or any part of the
Premises or the Building is damaged or destroyed,  Landlord  shall  promptly and
diligently  repair the same unless it has the right to  terminate  this Lease as
provided herein and it elects to so terminate.

                  B.  RIGHT TO  TERMINATE.  Landlord  shall  have  the  right to
terminate this Lease in the event any of the following events occur:

                           (i) insurance proceeds from the insurance Landlord is
required to carry pursuant to PARAGRAPH 21.C, or that Landlord actually carries,
are not available to pay one hundred  percent (100%) of the cost of such repair,
excluding any  applicable  deductibles,  for which Tenant shall be  responsible;
provided,  however,  that if Tenant pays to Landlord,  in immediately  available
funds,  within  thirty  (30) days after such  casualty,  any  shortfall  in such
insurance proceeds,  as reasonably  determined by Landlord,  then Landlord shall
have no right to  terminate  the  Lease  pursuant  to this  item  (i);  provided
further, that if insurance proceeds are not available to pay one hundred percent
(100%) of the cost of such  repair  due  solely to the fact  that  Landlord  has
failed to carry the insurance  described in PARAGRAPH  21.C, then Landlord shall
not have the right to terminate this Lease  pursuant to this PARAGRAPH  23.B(I).
Notwithstanding anything to the contrary set forth above, if (a) all or any part
of the Premises or the Building is damaged or destroyed by a casualty event that
is covered by the insurance  Landlord is required to carry pursuant to PARAGRAPH
21.C, or that Landlord  actually  carries,  (b) proceeds from such insurance are
not  available  to pay one hundred  percent  (100%) of the cost of such  repair,
excluding any applicable deductibles, (c) Landlord terminates the Lease pursuant
to its rights under this PARAGRAPH  23.B(I),  (d) Landlord  eventually  receives
proceeds from such  insurance due to such casualty  event,  and (e) a subsequent
tenant of the Premises  that  occupies  the  Premises  prior to the tenth (10th)
anniversary of the Commencement Date elects to utilize the Tenant  Improvements,
then  Landlord  shall pay to Tenant an amount equal to the present  value of the
lesser   of  (x)   the   cost   savings   enjoyed   by   Landlord   during   the
originally-scheduled  ten (10)  year  term of this  Lease  due to the use of the
Tenant Improvement by such subsequent tenant (with the amount of such savings to
be reasonably determined by Landlord), and (y) the unamortized

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<PAGE>
Tenant  Improvement  Costs (as  defined  in EXHIBIT  B) for the  initial  Tenant
Improvements,  as of the date such  subsequent  tenant opens for business in the
Premises,  with the Tenant  Improvement Costs being amortized on a straight-line
basis over a period of ten (10) years,  commencing on the Commencement Date, and
ending as of the date that is the mid-way  point  between the date this Lease is
terminated  and the date on which such  subsequent  tenant opens for business in
the Premises;

                           (ii) either the Premises or the Building cannot, with
reasonable  diligence,  be fully repaired by Landlord within three hundred sixty
(360) days after the date of the damage or destruction; or

                           (iii) either the  Premises or the Building  cannot be
safely repaired because of the presence of hazardous factors, including, but not
limited to, earthquake faults, radiation,  Hazardous Materials and other similar
dangers.

                  If Landlord elects to terminate this Lease,  Landlord may give
Tenant written notice of its election to terminate within thirty (30) days after
such damage or  destruction,  and this Lease shall  terminate  fifteen (15) days
after the date Tenant receives such notice and both Landlord and Tenant shall be
released of all  further  liability  under this Lease  (except to the extent any
provision of this Lease expressly survives termination).  If Landlord elects not
to terminate the Lease,  subject to Tenant's  termination right set forth below,
Landlord shall promptly commence the process of obtaining  necessary permits and
approvals  and repair of the  Premises or Building as soon as  practicable,  and
this Lease will continue in full force and affect.  All insurance  proceeds from
insurance under PARAGRAPH 21, excluding proceeds for Tenant's Personal Property,
shall be  disbursed  and paid to  Landlord.  Tenant  shall be required to pay to
Landlord  an  amount  equal  to  that  portion  of any  deductibles  payable  in
connection with any insured casualties that is allocable to the Premises, unless
the  casualty  was  caused  by the sole  negligence  or  willful  misconduct  of
Landlord.

                  Tenant  shall  have the right to  terminate  this Lease if the
Premises cannot, with reasonable diligence, be fully repaired within two hundred
seventy (270) days from the date of damage or destruction.  The determination of
the  estimated  repair  periods  in  this  PARAGRAPH  23  shall  be  made  by an
independent,  licensed contractor or engineer within thirty (30) days after such
damage

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<PAGE>
or  destruction.  Landlord shall deliver  written notice of the repair period to
Tenant  after such  determination  has been made and Tenant  shall  exercise its
right to  terminate  this Lease,  if at all,  within ten (10) days of receipt of
such notice from Landlord.  Upon such termination both Landlord and Tenant shall
be released of all further  liability under this Lease (except to the extent any
provision of this Lease expressly survives termination).

                  C. LIMITED OBLIGATION TO REPAIR. Landlord's obligation, should
it elect or be  obligated  to repair or  rebuild,  shall be limited to the basic
portion  of the  Building  in which the  Premises  are  situated  and the Tenant
Improvements, and shall not include any Alterations made by Tenant.

                  D.  ABATEMENT  OF  RENT.  Rent  shall  be  temporarily  abated
proportionately,   during  any  period  when,   by  reason  of  such  damage  or
destruction,  Tenant's use of the Premises is impaired.  Such  abatement of Rent
shall be proportional to the extent of such impairment  (with the extent of such
impairment to be reasonably  determined  by Landlord),  and shall  commence upon
such damage or destruction  and end upon  substantial  completion by Landlord of
the repair or  reconstruction  which  Landlord is  obligated  or  undertakes  to
perform.  Tenant  shall not be  entitled  to any  compensation  or damages  from
Landlord  for  loss of the use of the  Premises,  damage  to  Tenant's  Personal
Property or any inconvenience  occasioned by such damage, repair or restoration.
Tenant hereby waives the provisions of Section 1932,  Subdivision 2, and Section
1933,  Subdivision  4, of the  California  Civil Code, and the provisions of any
similar law hereinafter enacted.

                  E. DAMAGE NEAR END OF TERM.  Anything  herein to the  contrary
notwithstanding,  if the Premises is destroyed or materially  damaged during the
last twelve (12) months of the Term (unless  Tenant has properly  exercised  the
Option to Extend), then either Landlord or Tenant may, at its option, cancel and
terminate  this  Lease  as of the  date of the  occurrence  of such  damage,  by
delivery of written  notice to the other  party and,  in such  event,  upon such
termination both Landlord and Tenant shall be released of all further  liability
under this Lease  (except to the extent any  provision  of this Lease  expressly
survives  termination).  If neither Landlord nor Tenant elects to terminate this
Lease, the repair of such damage shall be governed by PARAGRAPHS 23.A and 23.B.

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<PAGE>
         24.      CONDEMNATION.

                  If title to all of the  Premises  is taken  for any  public or
quasi-public  use under any  statute or by right of eminent  domain,  or so much
thereof  is so  taken  so that  reconstruction  of the  Premises  will  not,  in
Landlord's sole discretion, result in the Premises being reasonably suitable for
Tenant's continued  occupancy for the uses and purposes permitted by this Lease,
this Lease shall  terminate  as of the date that  possession  of the Premises or
part thereof is taken,  and upon such termination both Landlord and Tenant shall
be released of all further  liability under this Lease (except to the extent any
provision of this Lease expressly survives  termination).  A sale by Landlord to
any  authority  having  the power of  eminent  domain,  either  under  threat of
condemnation or while  condemnation  proceedings are pending,  shall be deemed a
taking under the power of eminent domain for all purposes of this PARAGRAPH 24.

                  If any part of the Premises is taken and the remaining part is
reasonably  suitable for Tenant's continued  occupancy for the purposes and uses
permitted by this Lease, this Lease shall, as to the part so taken, terminate as
of the date that possession of such part of the Premises is taken, and upon such
termination both Landlord and Tenant shall be released of all further  liability
under this Lease with  respect  to that  portion of the  Premises  that is taken
(except  to  the  extent  any  provision  of  this  Lease   expressly   survives
termination).  The Rent and other sums payable hereunder shall be reduced in the
same proportion  that Tenant's use and occupancy of the Premises is reduced.  If
any portion of the Common Area is taken,  Tenant's Rent shall be reduced only if
such taking materially  interferes with Tenant's use of the Common Area and then
only to the  extent  that the  fair  market  rental  value  of the  Premises  is
diminished by such partial taking.  If the parties  disagree as to the amount of
Rent reduction, the matter shall be resolved by arbitration and such arbitration
shall comply with and be governed by the California  Arbitration  Act,  Sections
1280 through 1294.2 of the California Code of Civil Procedure. Each party hereby
waives  the  provisions  of Section  1265.130  of the  California  Code of Civil
Procedure allowing either party to petition the Superior Court to terminate this
Lease in the event of a partial taking of the Premises.

                  All  compensation  or  damages  awarded or paid for any taking
hereunder  shall  belong  to and be  the  property  of  Landlord,  whether  such
compensation or damages are awarded or paid as

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<PAGE>
compensation  for  diminution in value of the  leasehold,  the fee or otherwise,
except  that Tenant  shall be  entitled  to any award  allowed to Tenant for the
taking of Tenant's Personal Property, for the interruption of Tenant's business,
for its moving costs,  or for the loss of its good will, and for that portion of
the  unamortized  cost of any tenant  improvements  to the Premises  paid for by
Tenant,  including but not limited to the initial Tenant  Improvements,  that is
allocable to the remainder of the Term as of the date of such taking. Except for
the  foregoing  allocation,  no award for any  partial  or entire  taking of the
Premises shall be apportioned between Landlord and Tenant, and Tenant assigns to
Landlord  its  interest  in the  balance of any award  which may be made for the
taking or  condemnation  of the  Premises,  together  with any and all rights of
Tenant arising in or to the same or any part thereof.

         25.      ASSIGNMENT AND SUBLETTING.

                  A. LANDLORD'S CONSENT.  Subject to the provisions of PARAGRAPH
25.G  below,  Tenant  shall not enter  into a Sublet  without  Landlord's  prior
written consent, which consent shall not be unreasonably withheld. Any attempted
or purported  Sublet without  Landlord's prior written consent shall be void and
confer no rights  upon any third  person  and,  at  Landlord's  election,  shall
terminate this Lease. Each Subtenant shall agree in writing,  for the benefit of
Landlord,  to assume,  to be bound by, and to perform the terms,  conditions and
covenants of this Lease to be performed by Tenant, as such terms, conditions and
covenants  apply to the  Sublet  premises.  Notwithstanding  anything  contained
herein,  Tenant shall not be released from liability for the performance of each
term,  condition and covenant of this Lease by reason of Landlord's consent to a
Sublet unless Landlord specifically grants such release in writing.

                  B. TENANT'S  NOTICE.  If Tenant  desires at any time to Sublet
all or any  portion of the  Premises,  Tenant  shall  first  notify  Landlord in
writing of its desire to do so.

                  C. INFORMATION TO BE FURNISHED.  If Tenant desires at any time
to Sublet all or any  portion  of the  Premises,  then  Tenant  shall  submit in
writing to Landlord: (i) the name of the proposed Subtenant;  (ii) the nature of
the proposed  Subtenant's  business to be carried on in the Premises;  (iii) the
terms and  provisions of the proposed  Sublet and a copy of the proposed form of
Sublet agreement containing a description of the subject

                                       59
<PAGE>
premises; and (iv) such financial  information,  including financial statements,
as Landlord may reasonably request concerning the proposed Subtenant.

                  D. LANDLORD'S  ALTERNATIVES.  At any time within ten (10) days
after  Landlord's  receipt of the  information  specified  in  PARAGRAPH  25.C.,
Landlord may, by written notice to Tenant,  elect:  (i) to consent to the Sublet
by Tenant;  or (ii) to refuse its consent to the Sublet. If Landlord consents to
the Sublet,  Tenant may thereafter  enter into a valid Sublet of the Premises or
applicable portion thereof,  upon the terms and conditions and with the proposed
Subtenant set forth in the information furnished by Tenant to Landlord, subject,
however,  at Landlord's  election,  to the condition that fifty percent (50%) of
any excess of the Subrent (the "Excess  Subrent")  over the Rent  required to be
paid by Tenant  under  this  Lease (or,  if only a portion  of the  Premises  is
Sublet,  the pro rata  share  of the Rent  attributable  to the  portion  of the
Premises  being  Sublet)  less  (v)  reasonable  attorneys'  fees,  (w)  leasing
commissions  (which shall not include the cost of any trade fixtures,  equipment
or personal  property),  (x) that portion of the unamortized  Tenant Improvement
Costs (as defined in EXHIBIT B) for the initial Tenant Improvements allocable to
the portion of the  Premises  being Sublet (for the purposes of this clause (x),
the Tenant Improvement Costs shall be amortized over a period of ten (10) years,
at a per annum interest rate equal to the reference rate, or succeeding  similar
index,  announced  from time to time by the Bank of America's main San Francisco
office,  plus one percent  (1%),(y) the cost of any tenant  improvements  (other
than the initial  Tenant  Improvements)  paid for by Tenant and installed in the
portion of the Premises  being  Sublet for the specific  purpose of carrying out
such Sublet,  and (z) other  reasonable  subletting  costs paid by Tenant on the
Sublet, shall be paid to Landlord.

                  E. PRORATION.  If a portion of the Premises is Sublet, the pro
rata share of the Rent  attributable  to such partial area of the Premises shall
be  determined  by Landlord by dividing the Rent payable by Tenant  hereunder by
the total square footage of the Premises and multiplying the resulting  quotient
(the per square  foot rent) by the number of square feet of the  Premises  which
are Sublet.

                  F.  PARAMETERS  OF  LANDLORD'S  CONSENT.  Except as  otherwise
provided herein, Landlord shall have the right to base its consent to any Sublet
hereunder upon such factors and

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<PAGE>
considerations as Landlord reasonably deems relevant or material to the proposed
Sublet and the best interests of the Project's operations.  Without limiting the
generality of the foregoing, Tenant acknowledges that it shall be reasonable for
Landlord  to  withhold  its  consent to any Sublet  hereunder  if Tenant has not
demonstrated that: (i) the proposed Subtenant is financially  responsible,  with
sufficient  net worth and net  current  assets,  properly  and  successfully  to
operate  its  business  in  the  Premises  and  meet  the  financial  and  other
obligations of this Lease; (ii) the proposed Subtenant  possesses sound and good
business  judgment,  reputation and experience,  and proven management skills in
the  operation  of a business or  businesses  substantially  similar to the uses
permitted  in the  Premises  under  PARAGRAPH  11.A;  and  (iii)  the use of the
Premises  proposed by such  Subtenant  conforms to the permitted  uses specified
under  PARAGRAPH  11.A,  and  involves  either  no  Hazardous  Use or only  such
Hazardous Use as shall be acceptable to Landlord in its sole discretion.

                  G.  PERMITTED  TRANSFERS.  Notwithstanding  the  provisions of
PARAGRAPH  25.A above,  Tenant shall have the right to enter into a Sublet,  and
Landlord  shall not  withhold  its  consent  thereto  (provided  that all of the
conditions  set forth in clauses (A),  (B) and (C) below shall be met),  if such
Sublet  is one of the  following  "Permitted  Transfers":  (i) a  Sublet  to the
surviving  entity of a merger or  consolidation  involving the corporate  entity
constituting  the Tenant under this Lease; or (ii) a Sublet to any subsidiary or
Affiliate of the Tenant originally named in this Lease.  However,  the foregoing
Permitted  Transfers shall be exempt from the requirement of Landlord's  consent
only if all of the  following  conditions  shall be met:  (A) there  shall be no
change in the use or operation of the  Premises;  (B) Tenant shall have provided
to Landlord all  information to allow Landlord to determine,  and Landlord shall
have  determined,  that the proposed  transfer is a Permitted  Transfer which is
exempt from the requirement of Landlord's  consent;  and (C) as of the effective
date of such  Sublet,  the  proposed  Subtenant  has a net worth and net current
assets equal to or greater than those of the original Tenant under this Lease as
of the date of this Lease.  No Sublet of the type  described  in this  PARAGRAPH
25.G, nor any other  transfer of all or any portion of Tenant's  interest in the
Lease or the Premises, shall release Tenant of its obligations under this Lease.
In addition, any sale or transfer of the capital stock of Tenant shall be deemed
a Permitted Transfer if (1) such sale or transfer occurs in connection with

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any bona fide  financing  or  capitalization  for the benefit of Tenant,  or (2)
Tenant becomes a publicly  traded  corporation,  or (3) such sale or transfer is
made to any publicly  traded  corporation.  Notwithstanding  the  provisions  of
PARAGRAPH  25.D,  Landlord  shall  not be  entitled  to any  Excess  Subrent  in
connection with any Permitted Transfer.

                  In addition, Tenant shall have the right to sublease to one or
more subtenants one entire floor of the Premises with  Landlord's  prior written
consent,  which shall not be unreasonably  withheld,  and without payment of any
Excess Subrent to Landlord as provided in PARAGRAPH 25.D in connection with such
sublease,  provided  (w) there shall be no change in the use or operation of the
Premises,  (x)  Tenant is not in  default of its  obligations  hereunder,  which
default is continuing  after notice and the expiration of any  applicable  grace
period,  at the time of  entering  into  any such  sublease,  (y)  Tenant  is in
possession of the remainder of the Premises and remains primarily liable for all
of its  obligations  hereunder,  and (z) no such sublease shall have a term that
expires beyond the thirty-sixth  (36th) month following the  Commencement  Date.
Landlord  acknowledges  that the foregoing  right is a material  inducement  for
Tenant to enter  into this  Lease.  Tenant  acknowledges  that this  grammatical
paragraph  shall not apply to any  assignment or attempted  assignment of all or
any portion of its  interest in this  Lease,  nor to any  sublease of all or any
portion  of  the  Premises  by  Tenant  for  a  term  that  expires  beyond  the
thirty-sixth  (36th) month following the Commencement Date. The rights described
in this  grammatical  paragraph are personal to the Tenant  originally  named in
this Lease,  and shall not be  exercised  by any  assignee or  successor of such
Tenant.

         26.      DEFAULT.

                  A.  TENANT'S  DEFAULT.  A default  under  this Lease by Tenant
shall exist if any of the following occurs:

                           (i) If  Tenant  fails  to pay,  within  five (5) days
after  written  notice from  Landlord,  any Rent or any other sum required to be
paid hereunder when due, including,  without limitation,  any Tenant Improvement
Costs payable by Tenant under EXHIBIT B; or

                           (ii) If Tenant fails to perform any term, covenant or
condition of this Lease except those requiring the

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payment of money,  and Tenant fails to cure such breach  within thirty (30) days
after written notice from Landlord  where such breach could  reasonably be cured
within such 30-day period; provided,  however, that where such failure could not
reasonably  be cured  within  the 30-day  period,  that  Tenant  shall not be in
default if it commences such performance within the 30-day period and diligently
thereafter prosecutes the same to completion; or

                           (iii) If Tenant assigns its assets for the benefit of
its creditors; or

                           (iv)  If  the   sequestration  or  attachment  of  or
execution on any material part of Tenant's  Personal  Property  essential to the
conduct of  Tenant's  business  occurs,  and Tenant  fails to obtain a return or
release of such Tenant's  Personal  Property within thirty (30) days thereafter,
or prior to sale pursuant to such sequestration,  attachment or levy,  whichever
is earlier; or

                           (v) If Tenant abandons the Premises; or

                           (vi) If a court  makes or enters  any decree or order
other than under the bankruptcy laws of the United States adjudging Tenant to be
insolvent;  or approving as properly filed a petition seeking  reorganization of
Tenant;  or directing the winding up or liquidation of Tenant and such decree or
order shall have continued for a period of sixty (60) days.

                           (vii) If, at any time that  Landlord or its Affiliate
is also the owner of the  premises  leased by Tenant  under that  certain  Lease
between Martin/Campus  Associates No. 2, L.P. and Tenant dated February 5, 1997,
as amended by that certain First  Amendment to Lease dated December 3, 1997 (the
"575-595 Broadway Lease"), Tenant is in default under the 575-595 Broadway Lease
beyond any applicable notice and cure period.

                  B. REMEDIES. Upon a default, Landlord shall have the following
remedies,  in  addition  to all other  rights and  remedies  provided  by law or
otherwise  provided in this Lease, to which Landlord may resort  cumulatively or
in the alternative:

                           (i) Landlord  may  continue  this Lease in full force
and effect,  and this Lease  shall  continue in full force and effect as long as
Landlord does not  terminate  this Lease,  and Landlord  shall have the right to
collect Rent when due. Without

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limiting the  foregoing,  Landlord has the remedy set forth in Section 1951.4 of
the California Civil Code.

                           (ii)  Landlord  may  terminate   Tenant's   right  to
possession of the Premises at any time by giving  written notice to that effect,
and relet the Premises or any part thereof.  Tenant shall be liable  immediately
to Landlord for all costs Landlord  incurs in reletting the Premises or any part
thereof,  including,  without  limitation,  broker's  commissions,  expenses  of
cleaning and redecorating the Premises required by the reletting and like costs.
Reletting may be for a period  shorter or longer than the remaining Term of this
Lease.  No act by Landlord  other than giving  written  notice of termination to
Tenant shall terminate this Lease.  Neither acts of maintenance,  nor efforts to
relet the Premises,  nor the appointment of a receiver on Landlord's  initiative
to  protect  Landlord's  interest  under  this  Lease  shall  not  constitute  a
termination of Tenant's right to possession.  On  termination,  Landlord has the
right to remove all  Tenant's  Personal  Property and store the same at Tenant's
sole cost and expense and to recover from Tenant as damages:

                                    (a) The  worth  at the  time of award of the
unpaid Rent and other sums due and payable  which had been earned at the time of
termination; plus

                                    (b) The  worth  at the  time of award of the
amount by which the unpaid Rent and other sums due and payable  which would have
been payable  after  termination  until the time of award  exceeds the amount of
such Rent loss that Tenant proves could have been reasonably avoided; plus

                                    (c) The  worth  at the  time of award of the
amount by which the unpaid  rent and other sums due and  payable 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; plus

                                    (d) Any other amount necessary to compensate
Landlord for all the detriment proximately caused by Tenant's failure to perform
Tenant's  obligations  under this Lease,  or which,  in the  ordinary  course of
things, would be likely to result therefrom,  including, without limitation, any
costs or  expenses  incurred by  Landlord:  (i) in  retaking  possession  of the
Premises;  (ii) in maintaining,  repairing,  preserving,  restoring,  replacing,
cleaning, altering or rehabilitating the Premises or

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any  portion  thereof,  including  such acts for  reletting  to a new  tenant or
tenants; (iii) for leasing commissions; or (iv) for any other costs necessary or
appropriate to relet the Premises; plus

                                    (e)  At  Landlord's  election,   such  other
amounts in addition to or in lieu of the foregoing as may be permitted from time
to time by the laws of the State of California.

                  The "worth at the time of award" of the amounts referred to in
PARAGRAPHS 26.B.(II)(A) and 26.B.(II)(B) is computed by allowing interest at the
Interest  Rate on the  unpaid  rent  and  other  sums due and  payable  from the
termination  date through the date of award. The "worth at the time of award" of
the amount referred to in PARAGRAPH 26.B.(II)(C) is computed by discounting such
amount at the discount rate of the Federal  Reserve Bank of San Francisco at the
time of award plus one percent  (1%).  Tenant  waives  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  or
Landlord  takes  possession  of the  Premises by reason of any default of Tenant
hereunder.

                           (iii) Landlord may, with or without  terminating this
Lease,  re-enter  the  Premises  and remove all  persons and  property  from the
Premises;  such  property  may be removed  and stored in a public  warehouse  or
elsewhere  at the cost of and for the  account of  Tenant.  No reentry or taking
possession  of the Premises by Landlord  pursuant to this  PARAGRAPH  26.B.(III)
shall be  construed  as an election  to  terminate  this Lease  unless a written
notice of such intention is given to Tenant.

                  C. LANDLORD'S  DEFAULT.  Landlord shall not be deemed to be in
default in the  performance  of any  obligation  required to be  performed by it
hereunder  unless  and until it has  failed to perform  such  obligation  within
thirty  (30) days  after  receipt  of  written  notice  by  Tenant  to  Landlord
specifying the nature of such default; provided,  however, that if the nature of
Landlord's  obligation  is such that more than thirty (30) days are required for
its performance,  then Landlord shall not be deemed to be in default if it shall
commence such  performance  within such 30-day period and thereafter  diligently
prosecute the same to completion.

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<PAGE>
         27.      SUBORDINATION.

                  A.  SUBORDINATION.  This  Lease is or may become  subject  and
subordinate to underlying  leases,  mortgages,  deeds of trust,  easements,  and
CC&Rs  (collectively,  "ENCUMBRANCES")  which may now or  hereafter  affect  the
Premises,  and  to  all  renewals,  amendments,  modifications,  consolidations,
replacements and extensions thereof; provided, however, if the holder or holders
of any such Encumbrance  (collectively,  "HOLDER") shall require that this Lease
be prior and superior  thereto,  within fifteen (15) days of written  request of
Landlord to Tenant,  Tenant shall execute, have acknowledged and deliver any and
all documents or instruments, in the form presented to Tenant, which Landlord or
Holder deems  reasonably  necessary or desirable for such  purposes.  Subject to
PARAGRAPH  27.C below,  Landlord  shall have the right to cause this Lease to be
and become and remain subject and subordinate to any and all Encumbrances  which
are now or may  hereafter be executed  covering  the  Premises or any  renewals,
modifications,  consolidations, replacements or extensions thereof, for the full
amount of all advances made or to be made  thereunder  and without regard to the
time or character of such advances,  together with interest  thereon and subject
to all the terms and provisions  thereof;  provided  only,  that in the event of
termination  of any such lease or upon the  foreclosure  of any such mortgage or
deed of trust,  so long as Tenant is not in default,  Holder agrees to recognize
Tenant's  rights  under  this  Lease as long as  Tenant  shall  pay the Rent and
observe  and  perform  all the  provisions  of this  Lease  to be  observed  and
performed by Tenant.  Within fifteen (15) days after Landlord's written request,
Tenant shall  execute any and all documents  reasonably  required by Landlord or
the  Holder  to make  this  Lease  subordinate  to any  lien of the  Encumbrance
(including,  without limitation,  subordination to all CC&Rs), including without
limitation a  Subordination,  Non-  Disturbance and Attornment  Agreement in the
form attached hereto as EXHIBIT E ("SNDA").  Subject to PARAGRAPH 27.C below, if
Tenant fails to do so, such failure shall constitute a default under this Lease,
and it shall be deemed that this Lease is subordinated to such Encumbrance.

                  B.  ATTORNMENT.  Notwithstanding  anything to the contrary set
forth in this  PARAGRAPH 27,  Tenant hereby  attorns and agrees to attorn to any
entity  purchasing  or  otherwise  acquiring  the  Premises at any sale or other
proceeding or pursuant to the exercise of any other  rights,  powers or remedies
under such Encumbrance.

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<PAGE>
                  C. NON-DISTURBANCE.  Notwithstanding  anything to the contrary
in this Lease,  if an Encumbrance,  other than any CC&R's,  is created after the
execution  of this Lease,  as a  condition  to the  subordination  of this Lease
thereto under  PARAGRAPH  27.A above,  Landlord  shall obtain from the Holder of
such Encumbrance, other than CC&R's, a SNDA in a commercially reasonable form or
in a form reasonably acceptable to Tenant.  Without in any way limiting the type
or form of SNDA that may be required by such Holder, Tenant hereby agrees that a
SNDA in the form attached to this Lease as EXHIBIT E shall be  reasonable.  Only
upon Landlord's delivery of a SNDA in the form of EXHIBIT E or in a commercially
reasonable form or in a form reasonably  acceptable to Tenant,  shall this Lease
be automatically subject and subordinate to such Encumbrance, other than CC&R's.
Within fifteen (15) business days after full  execution of this Lease,  Landlord
shall use reasonable  efforts to provide Tenant with a SNDA in the form attached
to this Lease as EXHIBIT E from each Holder of any  Encumbrance  in effect as of
the  date of  this  Lease,  confirming  that  the  existence  of the  "automatic
subordination" language contained in PARAGRAPH 27.A above shall not (without the
occurrence of some other act or event that constitutes a default by Tenant under
the Lease constitute a default by Tenant under this Lease). If Landlord fails to
deliver the required  SNDA(s) within the 15-day  period,  then, as Tenant's sole
and  exclusive  remedy,  Tenant shall have the right to terminate  this Lease by
giving  Landlord a written notice of  termination  within five (5) business days
after  expiration of such 15-day  period,  upon which  Landlord  shall  promptly
return to Tenant any Rent paid in advance and the  Security  Deposit.  If Tenant
does not exercise such termination right within such 5-business day period, then
Tenant  shall have no further  right to  terminate  this Lease  pursuant to this
PARAGRAPH 27.C and Tenant shall have no other rights or remedies with respect to
Landlord's failure to deliver such SNDA(s).

         28.      NOTICES.

                  Any notice or demand  required  or  desired to be given  under
this Lease  shall be in  writing  and shall be  personally  served or in lieu of
personal service may be given by certified mail, facsimile, or overnight courier
service.  All  notices  or  demands  under  this  Lease  shall be deemed  given,
received, made or communicated on the date personal delivery is effected; or, if
sent by certified mail, on the delivery date or attempted delivery date shown on
the return receipt; or, if sent by

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facsimile,  on the date sent by the  sender;  or, if sent by  overnight  courier
service, on the delivery date or attempted delivery date shown on such service's
records.  At the date of execution of this Lease,  the addresses of Landlord and
Tenant are as set forth in PARAGRAPH 1. After the Commencement Date, the address
of Tenant  shall be the  address of the  Premises.  Either  party may change its
address by giving notice of same in accordance with this PARAGRAPH 28.

         29.      ATTORNEYS' FEES.

                  If either  party  brings  any action or legal  proceeding  for
damages for an alleged  breach of any provision of this Lease,  to recover Rent,
or other sums due,  to  terminate  the  tenancy of the  Premises  or to enforce,
protect or establish  any term,  condition or covenant of this Lease or right of
either  party,  the  prevailing  party shall be entitled to recover as a part of
such action or  proceedings,  or in a separate  action brought for that purpose,
reasonable  attorneys' fees and costs,  including without limitation any and all
costs and  expenses  arising from (i)  collection  efforts,  (ii) any  appellate
proceedings, and (iii) any bankruptcy, insolvency or arbitration proceedings.

         30.      ESTOPPEL CERTIFICATES.

                  A. TENANT  ESTOPPEL.  Tenant  shall  within  fifteen (15) days
following written request by Landlord:

                  (i) Execute and deliver to Landlord any  documents,  including
estoppel certificates, in the form prepared by Landlord (a) certifying that this
Lease is  unmodified  and in full force and effect or, if modified,  stating the
nature of such  modification and certifying that this Lease, as so modified,  is
in full force and effect  and the date to which the Rent and other  charges  are
paid in advance,  if any, and (b) acknowledging  that there are not, to Tenant's
knowledge,  any  uncured  defaults  on the part of  Landlord,  or,  if there are
uncured defaults on the part of the Landlord, stating the nature of such uncured
defaults,  (c) evidencing the status of the Lease as may be required either by a
lender  making a loan to  Landlord  to be secured  by deed of trust or  mortgage
covering the Premises or a purchaser of the Premises from Landlord, and (d) such
other matters as may be reasonably  requested by Landlord.  Tenant's  failure to
deliver an  estoppel  certificate  within  fifteen  (15) days after  delivery of
Landlord's written request therefor shall be conclusive upon Tenant (a) that

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this Lease is in full force and effect,  without  modification  except as may be
represented  by  Landlord,  (b)  that  there  are  now no  uncured  defaults  in
Landlord's performance, and (c) that no Rent has been paid in advance. If Tenant
fails to so deliver a requested estoppel  certificate within the prescribed time
it shall be  conclusively  presumed  that this Lease is  unmodified  and in full
force and effect except as represented by Landlord.

                  (ii) Deliver to Landlord the current  financial  statements of
Tenant,  and  financial  statements  of the two (2) years  prior to the  current
financial  statements  year, with an opinion of a certified  public  accountant,
including  a balance  sheet and profit and loss  statement  for the most  recent
prior year,  all  prepared in  accordance  with  generally  accepted  accounting
principles consistently applied.

                  B. LANDLORD ESTOPPEL. Landlord shall, within fifteen (15) days
following  written request by Tenant,  execute and deliver to Tenant an estoppel
certificate,  in the form prepared by Tenant,(a)  certifying  that this Lease is
unmodified  and in full force and effect or, if modified,  stating the nature of
such  modification  and certifying that this Lease,  as so modified,  is in full
force and  effect and the date to which the Rent and other  charges  are paid in
advance,  if any,  and (b)  acknowledging  that  there  are not,  to  Landlord's
knowledge,  any uncured defaults on the part of Tenant, or, if there are uncured
defaults on the part of the Tenant, stating the nature of such uncured defaults,
and (c) such other matters as may be reasonably requested by Tenant.  Landlord's
failure  to deliver  an  estoppel  certificate  within  fifteen  (15) days after
delivery of Tenant's  written request therefor shall be conclusive upon Landlord
(a) that this Lease is in full force and effect,  without modification except as
may be  represented  by  Tenant,(b)  that there are now no uncured  defaults  in
Tenant's performance, and (c) that no Rent has been paid in advance. If Landlord
fails to so deliver a requested estoppel  certificate within the prescribed time
it shall be  conclusively  presumed  that this Lease is  unmodified  and in full
force and effect except as represented by Tenant.

         31.      TRANSFER OF THE PREMISES BY LANDLORD.

                  In the event of any  conveyance of the Premises and assignment
by Landlord of this Lease,  Landlord  shall be and is hereby  entirely  released
from all liability under any and all of its covenants and obligations  contained
in or derived from this

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Lease occurring  after the date of such  conveyance and  assignment,  and Tenant
agrees to attorn to such transferee  provided such transferee assumes Landlord's
obligations under this Lease.

         32.      LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS.

                  If  Tenant  shall at any  time  fail to make  any  payment  or
perform any other act on its part to be made or performed under this Lease,  and
such failure shall continue after the expiration of any applicable grace or cure
periods provided in this Lease, Landlord may, but shall not be obligated to (and
without  waiving or releasing  Tenant from any  obligation  of Tenant under this
Lease),  make such payment or perform such other act to the extent  Landlord may
deem desirable,  and in connection  therewith,  pay expenses and employ counsel.
All sums so paid by Landlord and all penalties,  interest, expenses and costs in
connection  therewith  shall be due and  payable by Tenant on the next day after
any such payment by Landlord,  together  with  interest  thereon at the Interest
Rate  from  such  date to the  date of  payment  by  Tenant  to  Landlord,  plus
collection  costs and attorneys'  fees.  Landlord shall have the same rights and
remedies for the nonpayment  thereof as in the case of default in the payment of
Rent.

         33.      TENANT'S REMEDY.

                  Landlord  shall never be  personally  liable under this Lease,
and Tenant shall look solely to the net cash flow  received by Landlord from its
ownership of the Building,  for recovery of any damages for breach of this Lease
by Landlord or on any judgment in connection  therewith.  None of the persons or
entities  comprising or representing  Landlord (whether partners,  shareholders,
officers, directors,  trustees, employees,  beneficiaries,  agents or otherwise)
shall ever be  personally  liable  under  this Lease or for any such  damages or
judgment, and Tenant shall have no right to effect any levy of execution against
any assets of such  persons or  entities  on  account of any such  liability  or
judgment. Any lien obtained by Tenant to enforce any such judgment, and any levy
of execution  thereon,  shall be subject and subordinate to all  Encumbrances as
specified in PARAGRAPH 27 above.

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         34.      MORTGAGEE PROTECTION.

                  If  Landlord  defaults  under this  Lease,  Tenant  shall give
written  notice  of  such  default  to any  beneficiary  of a deed of  trust  or
mortgagee of a mortgage  covering the Premises,  and offer such  beneficiary  or
mortgagee a reasonable opportunity to cure the default, including time to obtain
possession of the Premises by power of sale or a judicial  foreclosure,  if such
should prove necessary to effect a cure.

         35.      BROKERS.

                  Landlord  and  Tenant  acknowledge  and  agree  that they have
utilized the services of real estate brokers (with Cornish and Carey  Commercial
representing  Tenant, and BT Commercial  representing  Landlord) with respect to
the transactions between Landlord and Tenant that are represented by this Lease.
Tenant  warrants and represents  that it has had no dealings with any other real
estate broker or agent in connection  with the  negotiation  of this Lease,  and
that it  knows of no  other  real  estate  broker  or  agent  who is or might be
entitled to a commission in connection with this Lease.

         36.      ACCEPTANCE.

                  This Lease shall only become  effective  and binding upon full
execution hereof by Landlord and delivery of a signed copy to Tenant. This Lease
shall not be recorded.  Upon execution of this Lease,  the parties shall execute
and  acknowledge a Memorandum of Lease in the form attached hereto as EXHIBIT F,
which may be recorded by either Landlord or Tenant at such party's sole expense.
Upon the  expiration  or earlier  termination  of this Lease,  Tenant shall upon
Landlord's  request  execute  and  acknowledge  any  and all  documents  that in
Landlord's  discretion  may be required in order to terminate the  Memorandum of
Lease or otherwise remove the lien of the Memorandum of Lease from the Building.

         37.      PARKING.

                  Tenant shall have the non-exclusive  right, in common with any
other tenants or occupants of the Project,  to use up to 3.33 unassigned parking
spaces  per  each one  thousand  (1,000)  square  feet of  Rentable  Area in the
Premises,  upon  terms and  conditions,  as may from time to time be  reasonably
established by

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<PAGE>
Landlord.  Should  parking  charges or  surcharges of any kind be imposed on the
parking facilities by a governmental agency, Tenant shall reimburse Landlord for
such charges and/or  surcharges  or, if possible,  shall pay such charges and/or
surcharges  directly to the governmental agency and, in such event, Tenant shall
provide  Landlord with proof that such charges and/or  surcharges have been paid
by Tenant.

         38.      GENERAL.

                  A. CAPTIONS.  The captions and headings used in this Lease are
for the  purpose  of  convenience  only and shall not be  construed  to limit or
extend the meaning of any part of this Lease.

                  B. EXECUTED  COPY. Any fully executed copy of this Lease shall
be deemed an original for all purposes.

                  C. TIME.  Time is of the essence for the  performance  of each
term, condition and covenant of this Lease.

                  D.  SEPARABILITY.  If one or more of the provisions  contained
herein, except for the payment of Rent, is for any reason held invalid,  illegal
or   unenforceable   in   any   respect,   such   invalidity,   illegality,   or
unenforceability  shall not affect any other  provision of this Lease,  but this
Lease shall be construed as if such invalid,  illegal or unenforceable provision
had not been contained herein.

                  E. CHOICE OF LAW.  This Lease shall be construed  and enforced
in  accordance  with the laws of the State of  California.  The  language in all
parts of this Lease shall in all cases be construed as a whole  according to its
fair meaning and not strictly for or against either Landlord or Tenant.

                  F. GENDER;  SINGULAR,  PLURAL.  When the context of this Lease
requires, the neuter gender includes the masculine,  the feminine, a partnership
or corporation or joint venture, and the singular includes the plural.

                  G. BINDING  EFFECT.  The covenants and agreement  contained in
this  Lease  shall be  binding on the  parties  hereto  and on their  respective
successors and assigns to the extent this Lease is assignable.

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                  H.  WAIVER.  The waiver by Landlord of any breach of any term,
condition or covenant,  of this Lease shall not be deemed to be a waiver of such
provision or any subsequent  breach of the same or any other term,  condition or
covenant of this Lease. The subsequent  acceptance of Rent hereunder by Landlord
shall  not be  deemed  to be a waiver  of any  preceding  breach  at the time of
acceptance of such payment.  No covenant,  term or condition of this Lease shall
be deemed to have been waived by  Landlord  unless such waiver is in writing and
signed by Landlord. The waiver by Tenant of any breach of any term, condition or
covenant,  of this Lease shall not be deemed to be a waiver of such provision or
any  subsequent  breach of the same or any other term,  condition or covenant of
this Lease. No covenant, term or condition of this Lease shall be deemed to have
been waived by Tenant unless such waiver is in writing and signed by Tenant.

                  I.  ENTIRE  AGREEMENT.  This  Lease  is the  entire  agreement
between the parties, and there are no agreements or representations  between the
parties except as expressed  herein.  Except as otherwise  provided  herein,  no
subsequent  change or addition to this Lease shall be binding  unless in writing
and signed by the parties hereto.

                  J.  AUTHORITY.  If Tenant is a corporation  or a  partnership,
each  individual   executing  this  Lease  on  behalf  of  said  corporation  or
partnership,  as the  case  may  be,  represents  and  warrants  that he is duly
authorized  to  execute  and  deliver  this  Lease on behalf  of said  entity in
accordance with its corporate bylaws, statement of partnership or certificate of
limited partnership,  as the case may be. Landlord, at its option, may require a
copy of such written authorization to enter into this Lease.

                  K.  EXHIBITS.  All  exhibits,  amendments,  riders and addenda
attached hereto are hereby incorporated herein and made a part hereof.

                  L. LEASE SUMMARY.  The Lease Summary attached to this Lease is
intended to provide general  information only. In the event of any inconsistency
between  the Lease  Summary  and the  specific  provisions  of this  Lease,  the
specific provisions of this Lease shall prevail.

                                       73
<PAGE>
         39.      EQUIPMENT LEASING/LANDLORD'S LIEN.

                  Notwithstanding  anything  herein  to the  contrary,  Landlord
waives any and all rights, title and interest Landlord now has, or hereafter may
have,  whether  statutory  or  otherwise,  to  Tenant's  inventory,   equipment,
furnishings,  trade fixtures,  books and records, and personal property paid for
by  Tenant   located  at  the  Premises   (singly   and/or   collectively,   the
"COLLATERAL").  Landlord  acknowledges that Landlord has no lien, right,  claim,
interest or title in or to the Collateral.  Landlord  further agrees that Tenant
shall have the right, at its  discretion,  to mortgage,  pledge,  hypothecate or
grant a security  interest in the  Collateral  as security  for its  obligations
under any equipment lease or other financing  arrangement related to the conduct
of Tenant's  business at the Premises.  Landlord  further  agrees to execute and
deliver  within  three  (3)  business  days any UCC  filing  statement  or other
documentation  required to be executed by Landlord in  connection  with any such
lease or financing arrangement, including but not limited to a Landlord's Waiver
and Consent form.

         40.      RIGHT OF EARLY ENTRY.

                  Tenant shall have the right to enter the Premises prior to the
commencement  of the  Term  to  take  reasonable  preparatory  measures  for its
occupancy of the Premises including, without limitation, the installation of its
trade  fixtures,  furnishings,  and telephone,  telecommunications  and computer
equipment, so long as Tenant does not materially interfere with the construction
of the Improvements by Landlord and Landlord's  contractor.  Such entry shall be
subject to all of the terms and  conditions  of this  Lease,  except that Tenant
shall  not be  required  to pay  any  Rent  on  account  thereof.  Tenant  shall
indemnify,  defend, protect, and hold harmless Landlord from and against any and
all losses, costs, damages, liability, claims and expenses arising from any such
entry onto the Premises by Tenant.

                  THIS  LEASE is  effective  as of the  date the last  signatory
necessary to execute the Lease shall have executed this Lease.


                        [SIGNATURES FOLLOW ON NEXT PAGE]

                                       74
<PAGE>
                         TENANT:

                         BROADVISION, INC.,
                         a Delaware corporation


                         By:   /s/ Signature Illegible
                             ------------------------------
                         Its: CEO
                             ------------------------------
                         Date:  2/1/99
                             ------------------------------


                         By:
                             ------------------------------
                         Its:
                             ------------------------------
                         Date:
                             ------------------------------


                         LANDLORD:

                         MARTIN/CAMPUS ASSOCIATES NO. 4, L.P.,
                         a Delaware limited partnership

                         By:  Martin/Redwood Associates, L.P.,
                              a California limited partnership
                              Its General Partner

                              By:  TMG Redwood LLC,
                                   a California limited liability
                                   company
                                   Its General Partner

                                   By:  The Martin Group
                                        of Companies, Inc.,
                                        a California corporation
                                        Its General Partner


                                        By:/s/ Cathy Illegible
                                           ---------------------------------
                                        Its: Vice President
                                           ---------------------------------
                                        Date:  2/10/99
                                             -------------------------------


                                        By:
                                           ---------------------------------
                                        Its:
                                           ---------------------------------
                                        Date:
                                             -------------------------------

                                       75
<PAGE>
                                    EXHIBIT A-1

                             FLOOR PLAN OF PREMISES



<PAGE>
                                   EXHIBIT A-2

                             FLOOR PLAN OF PREMISES



<PAGE>
                                    EXHIBIT B

                              WORK LETTER AGREEMENT

                  THIS WORK LETTER ("Agreement") is made and entered into by and
between Landlord and Tenant as of the date of the Lease. This Agreement shall be
deemed a part of the Lease to which it is attached.  Capitalized terms which are
used herein and defined in the Lease shall have the meanings given in the Lease.

         1.       GENERAL.

                  1.1. CAPITAL IMPROVEMENTS.  Prior to the Commencement Date, at
Landlord's sole cost and expense, Landlord shall do the following (collectively,
the "CAPITAL IMPROVEMENTS"):

                  o        Remove  all  existing  interior  improvements  in the
                           Premises  with  the  exception  of two  (2)  existing
                           elevators, but including all existing restrooms.

                  o        Remove all existing HVAC equipment  currently located
                           on roof.

                  o        Remove all existing fire sprinkler  improvements back
                           to  the  fire  riser   except  the  main  line  which
                           penetrates the steel beams.  Landlord  covenants that
                           the fire  riser  shall be in working  condition.  Any
                           repairs   to  the  main   line   shall  be  a  Tenant
                           Improvement   Cost.   Tenant   shall   pay  for  fire
                           monitoring equipment and connection costs.

                  o        Provide 150 tons of new HVAC  equipment to be located
                           on the roof of the  Building.  As part of the Capital
                           Improvements,  the supply and return ducting shall be
                           run from the HVAC  equipment  onto each  floor of the
                           Premises.  All  other  ducting,   distribution,   and
                           controls shall be part of the Tenant Improvements.

                  o        Provide 2000 amp, 480 volt electrical  service to the
                           Building.  The Capital  Improvements  will  include a
                           transformer to be located on a pad on the exterior of
                           the Building with the PG&E pull section into the main
                           electric  room.  All  conduit,   wiring  devices  and
                           controls downstream of the main

                                        1
<PAGE>
                           panel  and  any  walls  or  ceiling  needed  for  the
                           electric   room   shall   be  part   of  the   Tenant
                           Improvements.  Electrical  conduit  and wiring to the
                           main HVAC equipment will be a Capital Improvement.

                  o        Remove  the  existing  roof  and  replace  it  with a
                           three-ply built-up roof with a  mineral-surfaced  cap
                           sheet.

                  o        Perform any exterior  ADA and  exterior  code-related
                           work   required  by  the  City  of  Redwood  City  in
                           connection  with  the  initial  construction  of  the
                           Premises  per the site plan as shown in  EXHIBIT  B-2
                           attached hereto.

                  o        Remove all interior friable and non-friable  asbestos
                           within the  Building and  basement  areas  (excluding
                           transite panels on curtain wall of the Building).

                  o        Remove the security  screen  around the  perimeter of
                           the Building and change the existing  vision glass as
                           shown on EXHIBIT  B-1.  Repaint  the  exterior of the
                           Building.

                  o        Provide  two  (2),  four-inch  (4")  empty  telephone
                           conduits from an area on the street designated by the
                           utility company to the electric room in the Building.

                  o        Modify  the  area   adjacent   to  the   Building  in
                           substantial conformity with the site plan as shown in
                           EXHIBIT B-2.

                  o        On the north  elevation of the Building,  construct a
                           new canopy at the  Building's  main entry and install
                           slate on the existing  sheer wall element as shown on
                           the attached  EXHIBIT B-1. Any and all Tenant signage
                           shall be a part of the Tenant Improvements.

                  o        Any insulation required for Title 24 compliance shall
                           be part of the Tenant Improvements.

                                        2
<PAGE>
                  o        Install one hydraulic  passenger elevator 2,500 pound
                           capacity  (may be  holeless or not  holeless)  in the
                           approximate  location  as  shown on the  floor  plans
                           attached  hereto as EXHIBIT A, in accordance with all
                           applicable laws, including but not limited to the ADA
                           (as defined in the Lease).

                  o        Landlord  intends to abandon in place the  electrical
                           and  mechanical  equipment  currently  housed  in the
                           basement of the Building.

                  o        Tenant  will  be   permitted  to  install  a  back-up
                           generator  on  the  exterior  of  the  Building  in a
                           mutually  agreed-upon  location.  All  of  the  costs
                           associated  with the generator,  including  screening
                           will be part of the Tenant Improvements.

                  o        Leave  the slab,  walls and roof deck in good,  clean
                           condition.

Notwithstanding  Landlord's  agreement to construct the Capital  Improvements at
its sole  cost,  Landlord  and  Tenant  agree to share  equally  the cost of any
necessary  filling in or leveling of the interior  concrete  floor deck provided
that  the cost  thereof  does not  exceed  Fifty  Thousand  and  00/100  Dollars
($50,000.00).  If the  cost  does  exceed  Fifty  Thousand  and  00/100  Dollars
($50,000.00),  Landlord  shall  pay  such  excess  cost.  Tenant  shall  pay its
proportionate  share of such costs  within  thirty  (30) days  after  receipt of
Landlord's statement therefor.  Landlord shall exercise commercially  reasonable
judgment  pursuant to industry  building  standards in determining the amount of
leveling to be done in the Premises.

Except for its  obligation  to perform the Capital  Improvements  and the Tenant
Improvements as set forth in this Lease and the Work Letter, Landlord shall have
no obligation  whatsoever to do any work or perform any improvements  whatsoever
to any portion of the  Premises or the  Building;  provided,  however,  that the
Tenant  Improvements  shall be performed at the sole cost and expense of Tenant.
Landlord  shall  cause  Contractor  (as  defined  below) to perform  all initial
leasehold  improvements,  in  accordance  with the  approved  Final Plans and as
otherwise  may be required  to comply with  applicable  law  (collectively,  the
"TENANT  IMPROVEMENTS").  The  parties  acknowledge  and agree that the  Capital
Improvements and the Tenant Improvements constitute all

                                        3
<PAGE>
of the work  required to enable  Tenant to occupy,  and operate its business in,
the Premises.  If Landlord materially alters the current landscape,  parking and
lighting plans for the Project before the Commencement Date, then Landlord shall
consult  with  Tenant  regarding  such  modification,  but Tenant  shall have no
approval rights regarding such modification.  Landlord shall (i) cause,  through
Contractor,  the Capital  Improvements to be performed in a good and workmanlike
manner  using  new  materials  and  in  accordance  with  all  applicable  legal
requirements,  and (ii) use its best efforts to cause,  through Contractor,  the
Improvements to be performed in accordance with the schedule  attached hereto as
EXHIBIT B-3 (the "Schedule");  provided,  however, that Landlord's obligation to
use  reasonable  efforts to cause the Tenant  Improvements  to be  performed  in
accordance  with the Schedule  shall be subject to and  dependent  upon Tenant's
compliance  with  the  Schedule  and the  terms of this  Agreement  and to Force
Majeure Delays as defined in PARAGRAPH 4.B of the Lease.  Landlord,  at its sole
cost,  shall  obtain  all  permits,  licenses  and  authorizations  required  in
connection with the Capital Improvements. All Landlord design work for the shell
condition shall be designed and submitted to the City of Redwood City for permit
prior to Tenant submitting its plans for the Tenant Improvements to the City for
permit.

                  1.2.  TENANT  IMPROVEMENT  COSTS.  The cost of performing  the
Tenant  Improvements,  including  without  limitation  the  costs  described  in
PARAGRAPH 6 below  (collectively,  the "TENANT IMPROVEMENT COSTS") shall be paid
by Tenant in the manner set forth in PARAGRAPH 5 below.

         2.       APPROVAL OF PLANS FOR TENANT IMPROVEMENTS.

                  2.1.   ARCHITECT.   Tenant  has  selected   HPC   Architecture
("ARCHITECT")   for  the  design  and   preparation  of  plans  for  the  Tenant
Improvements. Tenant shall retain Architect's administrative services throughout
the performance of the Tenant Improvements.

                  2.2. SUBMITTAL OF PLANS.

                           2.2.1.   PRELIMINARY   PLANS.   Tenant   shall  cause
Architect to prepare preliminary plans (the "PRELIMINARY  PLANS") for the Tenant
Improvements  to be performed at the Premises.  Tenant shall cause  Architect to
deliver  the  Preliminary  Plans to  Landlord in  accordance  with the  Schedule
attached as EXHIBIT B-3.

                                        4
<PAGE>
Within five (5) days after Landlord's receipt of the Preliminary Plans, Landlord
shall either approve or disapprove the Preliminary  Plans,  which approval shall
not be unreasonably  withheld.  Failure of Landlord to approve or disapprove the
Preliminary  Plans within such  five-day  period  shall be deemed to  constitute
Landlord's  approval  of the  Preliminary  Plans.  If Landlord  disapproves  the
Preliminary  Plans,  then Landlord shall state in reasonable  detail the changes
which  Landlord  requires to be made  thereto.  Tenant  shall submit to Landlord
revised  Preliminary  Plans  within  five (5) days  after  Tenant's  receipt  of
Landlord's  disapproval  notice.  Following  Landlord's  receipt of the  revised
Preliminary  Plans  from  Tenant,  Landlord  shall  have the right to review and
approve the revised Preliminary Plans pursuant to this PARAGRAPH 2.2.1. Landlord
shall give Tenant  written  notice of its approval or disapproval of the revised
Preliminary  Plans  within  five (5) days after the date of  Landlord's  receipt
thereof.  Failure of Landlord to approve or  disapprove  the  Preliminary  Plans
within such five-day period shall be deemed to constitute Landlord's approval of
the revised  Preliminary Plans. If Landlord  disapproves the revised Preliminary
Plans,  then  Landlord and Tenant shall  continue to follow the  procedures  set
forth in this PARAGRAPH  2.2.1 until Landlord and Tenant approve the Preliminary
Plans in accordance with this PARAGRAPH 2.2.1.

                           2.2.2. PRELIMINARY BUDGET. Landlord intends to retain
Devcon   Construction   ("CONTRACTOR")   as  the  general   contractor  for  the
construction  of  the  Tenant  Improvements,  Air  Systems  for  the  mechanical
design-build  work and Frank  Electric  for the  electrical  design-build  work.
Within the time  period  provided  in the  Schedule  attached  as  EXHIBIT  B-3,
Contractor shall prepare a preliminary budget for the Tenant  Improvements based
upon the approved Preliminary Plans, which Contractor shall submit to Tenant for
its review  and  approval.  Within  the time  period  provided  in the  Schedule
attached  as  EXHIBIT  B-3,  Tenant and  Landlord  shall  review and  approve or
disapprove the Preliminary Plans and the preliminary budget.

                           2.2.3.  FINAL PLANS.  Within the time period provided
in the  Schedule  attached  as EXHIBIT  B-3,  Tenant  shall cause  Architect  to
commence  preparing  complete plans,  specifications  and working drawings which
incorporate  and  are  consistent  with  the  approved   Preliminary  Plans  and
preliminary  budget, and which show in detail the intended design,  construction
and finishing of all portions of the Tenant

                                        5
<PAGE>
Improvements  described  in the  Preliminary  Plans  (collectively,  the  "FINAL
PLANS").  Tenant  shall cause  Architect to deliver the Final Plans to Landlord,
for  Landlord's  review and  approval  within the time  period  provided  in the
Schedule attached as EXHIBIT B-3. Within five (5) days after Landlord's  receipt
of the Final Plans, Landlord shall either approve or disapprove the Final Plans,
which approval shall not be unreasonably withheld. Landlord's failure to approve
or  disapprove  the Final Plans within such  five-day  period shall be deemed to
constitute  Landlord's approval of the Final Plans. If Landlord  disapproves the
Final Plans,  then Landlord  shall state in reasonable  detail the changes which
Landlord  requires to be made thereto.  Tenant shall submit to Landlord  revised
Final  Plans  within  five  (5)  days  after  Tenant's   receipt  of  Landlord's
disapproval notice. Following Landlord's receipt of the revised Final Plans from
Tenant,  Landlord  shall have the right to review and approve the revised  Final
Plans  pursuant to this  PARAGRAPH  2.2.3.  Landlord  shall give Tenant  written
notice of its approval or disapproval of the revised Final Plans within five (5)
days after the date of Landlord's receipt thereof. Landlord's failure to approve
or  disapprove  the Final Plans within such  five-day  period shall be deemed to
constitute   Landlord's  approval  of  the  revised  Final  Plans.  If  Landlord
disapproves the revised Final Plans,  then Landlord and Tenant shall continue to
follow the  procedures  set forth in this  PARAGRAPH  2.2.3 until  Landlord  and
Tenant  reasonably  approve such Final Plans in accordance  with this  PARAGRAPH
2.2.3.

         3.  CONSTRUCTION  BUDGET.  Upon  approval by Landlord and Tenant of the
Final Plans,  Landlord shall instruct  Contractor to obtain competitive bids for
the Tenant  Improvements  from at least three (3) qualified  subcontractors  for
each of the major  subtrades  (excluding  the  mechanical,  electrical  and fire
sprinkler trades, which shall be on a design/build basis, unless Landlord elects
to  competitively  bid these  trades)  and to submit  the same to Tenant for its
review and approval.  Upon selection of the  subcontractors  and approval of the
bids,  Contractor  shall  prepare a cost  estimate  for the Tenant  Improvements
described  in  such  Final  Plans,   based  upon  the  bids   submitted  by  the
subcontractors  selected.  Within  the  time  period  provided  in the  Schedule
attached as EXHIBIT B-3,  Contractor  shall submit such cost  estimate to Tenant
for its review and approval.  Tenant may approve or reject such cost estimate in
its reasonable  sole  discretion.  If Tenant rejects such cost estimate,  Tenant
shall resolicit bids based on such Final Plans, in accordance with the

                                        6
<PAGE>
procedures  specified  above.  Following  any  resolicitation  of bids by Tenant
pursuant to this PARAGRAPH 3, Tenant shall again follow the procedures set forth
in this PARAGRAPH 3 with respect to the  submission  and reasonable  approval of
the cost estimate from Contractor;  provided, however, that Tenant shall only be
permitted  to  resolicit  bids once  following  Tenant's  rejection  of the cost
estimate  and  Tenant  shall  select  from  the  bids  received  in  the  second
solicitation of bids.

         4. LANDLORD TO CONSTRUCT.  Landlord shall cause Contractor to construct
the Tenant Improvements in a good and workmanlike manner, in accordance with the
approved Final Plans and in compliance with all applicable laws. Architect shall
be responsible  for obtaining all necessary  building  permits and approvals and
other authorizations from governmental  agencies required in connection with the
Tenant  Improvements.  The cost of all such  permits  and  approvals,  including
inspection and other building fees required to obtain the permits for the Tenant
Improvements,  shall be included as part of the Tenant Improvement Costs. Tenant
shall  have  the  benefit  of  any  warranties   provided  by  Contractor,   the
subcontractors and suppliers in connection with the Tenant Improvements.

         5. PAYMENT FOR TENANT IMPROVEMENTS.  The Tenant Improvement Costs shall
be paid solely by Tenant as follows:

                  5.1.  TENANT  IMPROVEMENT  ALLOWANCE.  Landlord  shall provide
funds, to be used for the payment of Tenant  Improvement Costs, in an amount not
to exceed Ten and 00/100  Dollars per square foot of Rentable  Area (the "Tenant
Improvement Allowance"). Tenant shall pay all of the Tenant Improvement Costs in
excess of the Tenant  Improvement  Allowance (the "Excess  Costs") in accordance
with PARAGRAPH 5.2.

                  5.2.  SET-ASIDE  FUNDS.  Within five (5) days after Tenant has
approved the cost estimate for the Tenant  Improvements  pursuant to PARAGRAPH 3
above,  Tenant  shall  deposit  into  a  separate  account  with  any  financial
institution  designated by Landlord,  subject to  restrictions  in favor of such
financial  institution,  an amount (the  "SET-ASIDE  FUNDS") equal to the Excess
Costs,  based on the assumption that the cost of the Tenant  Improvements  shall
equal the Tenant  Improvement  Allowance and the Excess Cost estimate.  Landlord
shall  instruct such  financial  institution  to hold the  Set-Aside  Funds in a
separate  interest-bearing account with interest to accrue for Tenant's account,
and

                                        7
<PAGE>
shall utilize the Set-Aside Funds to pay for the Tenant Improvement Costs in the
manner set forth in this PARAGRAPH 5.

                  5.3.  PAYMENT.  As and when any  Excess  Costs  become due and
payable, and so long as Landlord has delivered to Tenant copies of unconditional
lien releases from Contractor and the major subcontractors covering the work for
which such Tenant  Improvement  Costs are payable,  Landlord  shall request such
financial institution to utilize the remaining Set-Aside Funds to pay any amount
of Excess Costs;  provided,  however, that if at any time there are insufficient
Set-Aside Funds to pay any amount of the Excess Costs,  Tenant shall pay any and
all such  Excess  Costs to  Landlord  within  ten (10)  days  after  the date of
Tenant's receipt of Landlord's  written request therefor;  and provided further,
that  Landlord  shall  use  reasonable   efforts  to  provide  for  commercially
reasonable  holdbacks  with  respect to the  payment  of the Tenant  Improvement
Costs.  Any failure by Tenant to pay any Excess Costs as and when required under
this Agreement shall constitute a default by Tenant under the Lease.

                  5.4.   PENALTIES.   To  the  extent  that  any  contractor  or
subcontractor  working on the Tenant  Improvements  imposes  upon  Landlord  any
penalty or late charge due to Tenant's failure to pay to Landlord any amount due
under this PARAGRAPH 5.4 as and when such amount is due,  Tenant shall be solely
responsible for paying such penalty or late charge.

         6. TENANT IMPROVEMENT COSTS. The Tenant Improvement Costs shall include
all reasonable  costs incurred in connection with the Tenant  Improvements  (but
not the Capital  Improvements),  as  determined  by  Landlord in its  reasonable
discretion, including the following:

                  (a) All  costs of space  plans  and  other  architectural  and
engineering  plans and  specifications  for the Tenant  Improvements,  including
engineering  costs associated with completion of the State of California  energy
utilization  calculations under Title 24 legislation required in connection with
the Tenant Improvements and the base Building mechanical;

                  (b)  All  costs  of  obtaining   building  permits  and  other
necessary authorizations from the City of Redwood City;

                                        8
<PAGE>
                  (c) All costs of interior design and finish schedule plans and
specifications, including as-built drawings by Architect;

                  (d) All direct and indirect  costs of procuring,  constructing
and  installing  the Tenant  Improvements  in the Premises,  including,  but not
limited to, the  construction  fee of four and one-half percent (4 1/2%) payable
to the  Contractor  for  overhead  and  profit,  and  the  cost  of all  on-site
supervisory and administrative  staff, office,  equipment and temporary services
rendered  by  Contractor  in  connection   with   construction   of  the  Tenant
Improvements;

                  (e) All fees payable to Architect and  Landlord's  engineering
firm if they are  required  by Tenant to  redesign  any  portion  of the  Tenant
Improvements following Tenant's approval of the Final Plans;

                  (f) Sewer connection fees (if any);

                  (g) All direct and indirect construction costs associated with
complying  with  Title  24  legislation  and ADA  compliance  for  all  interior
improvements;

                  (h) All direct and indirect construction costs associated with
complying with Title 24 legislation and ADA compliance resulting from changes to
the exits from the Building; and

                  (i) A construction management fee payable to Landlord equal to
Forty Thousand and 00/100 Dollars ($40,000.00).

In no event shall the Tenant  Improvement  Costs include any costs of procuring,
constructing  or installing in the Premises any of Tenant's  Personal  Property,
trade fixtures, equipment,  inventory, computer network,  communications system,
promotional materials, signage or related expenses.

         7. CHANGE  REQUESTS.  No revisions to the approved Final Plans shall be
made by either  Landlord or Tenant  unless  approved in writing by both parties.
Landlord agrees to make all changes (i) required by any public agency to conform
with  governmental  regulations,  or (ii)  requested  in  writing  by Tenant and
approved  in writing  by  Landlord,  which  approval  shall not be  unreasonably
withheld. Any costs related to such changes shall be added to

                                        9
<PAGE>
the Tenant  Improvement Costs and shall be paid for in accordance with PARAGRAPH
5. The billing for such additional costs shall be accompanied by evidence of the
amounts billed as is customarily used in the business.  Costs related to changes
shall include, without limitation, any architectural, structural engineering, or
design fees,  and the  Contractor's  price for effecting the change.  Any change
order  which  may  extend  the  date of  substantial  completion  of the  Tenant
Improvements  may be disapproved  by Landlord  unless Tenant agrees that for all
purposes under this Lease, the Tenant  Improvements shall be deemed to have been
substantially  completed  on that date on which such Tenant  Improvements  would
have been  substantially  completed without giving effect to the change order in
question.

                        [SIGNATURES FOLLOW ON NEXT PAGE]

                                       10
<PAGE>
                         TENANT:
                         BROADVISION, INC.,
                         a Delaware corporation


                         By:   /s/ Signature Illegible
                             ------------------------------
                         Its: CEO
                             ------------------------------
                         Date:  2/1/99
                             ------------------------------


                         By:
                             ------------------------------
                         Its:
                             ------------------------------
                         Date:
                             ------------------------------


                         LANDLORD:
                         MARTIN/CAMPUS ASSOCIATES NO. 4, L.P.,
                         a Delaware limited partnership

                         By:  Martin/Redwood Associates, L.P.,
                              a California limited partnership
                              Its General Partner

                              By:  TMG Redwood LLC,
                                   a California limited liability
                                   company
                                   Its General Partner

                                   By:  The Martin Group
                                        of Companies, Inc.,
                                        a California corporation
                                        Its General Partner


                                        By:/s/ Cathy Illegible
                                           ---------------------------------
                                        Its: Vice President
                                           ---------------------------------
                                        Date:  2/10/99
                                             -------------------------------


                                        By:
                                           ---------------------------------
                                        Its:
                                           ---------------------------------
                                        Date:
                                             -------------------------------

                                       11
<PAGE>
                                   EXHIBIT B-1

             [ELEVATION PLAN DEPICTING VISION GLASS AND NEW CANOPY]

                                       12
<PAGE>
                                   EXHIBIT B-2

               [SITE PLAN DEPICTING SECURITY SCREEN, VISION GLASS
                AND MODIFICATIONS TO AREAS ADJACENT TO BUILDING]

                                       13
<PAGE>
                                   EXHIBIT B-3

                                    SCHEDULE

<TABLE>
<CAPTION>
    ACTION BY                             ISSUE                                    DURATION
                                                                             (DAYS ARE WORK-DAYS)
<S>                <C>                                        <C>                               <C>                <C>
Tenant              Client Programming                                                                             In Progress
Landlord            Deliver clean base sheets in electronic                                                        Completed
                    form
Tenant              Design and Architectural CD's              40 Days starting after
                                                               ____________, 1999
Tenant              Complete Mechanical, Electrical,           Concurrent with CD Design and
                    Plumbing and Fire for ti's                 Architectural
Tenant              Package ti plans and submit to City        5 Days
Landlord            Plans go out for final bid                 0 Days
Landlord            Bid results presented                      0 Days
Tenant              Construction Budget Approved by            9 Days (from presentation of Bid
                    Tenant                                     Results)
Tenant              Set aside account for ti's funded          0 Days (from Construction Budget
                                                               Approval)
Tenant              City Permit Cycle for ti's                 30 Days (from submittal to City)
Tenant              Respond to Interior Comments               5 Days (from City comments)
Landlord            Respond to Shell Comments                  5 Days (from City comments)
Tenant              Re-submit for final approval for ti's      1 Day
Landlord            Shell Weather tight, new roof, elevator                                     By April 1, 1999
                    in progress, shafts open, ready for ti
                    construction commencement
Landlord            Start Interior Construction                                                 By April 5, 1999
Landlord            Construction of Interiors                  14 Weeks
Landlord            Punch List Items, Lease                    2 Weeks
                    Commencement
</TABLE>

                                       14
<PAGE>
                                    EXHIBIT C

                              SITE PLAN FOR PROJECT

                                       15
<PAGE>
                                    EXHIBIT D

                          COMMENCEMENT DATE MEMORANDUM


LANDLORD:                  Martin/Campus Associates No. 4, L.P.

TENANT:                    Broadvision, Inc.

LEASE DATE:                January ___, 1999

PREMISES:         405 Broadway, Redwood City, California

Pursuant to PARAGRAPH 4.A. of the above referenced  Lease, the commencement date
is hereby established for 405 Broadway, Redwood City, CA 94063. The Commencement
Date as defined in PARAGRAPH 4.A shall be __________________, 1999.

                                    TENANT:

                                    BROADVISION, INC.,
                                    a Delaware corporation


                                    By:     __________________________
                                    Its:    __________________________
                                    Date:   __________________________


                                    By:     __________________________
                                    Its:    __________________________
                                    Date:   __________________________




                        [SIGNATURES FOLLOW ON NEXT PAGE]

                                        1
<PAGE>
                         LANDLORD:

                         MARTIN/CAMPUS ASSOCIATES NO. 4, L.P.,
                         a Delaware limited partnership

                         By:  Martin/Redwood Associates, L.P.,
                              a California limited partnership
                              Its General Partner

                              By:  TMG Redwood LLC,
                                   a California limited liability
                                   company
                                   Its General Partner

                                   By:  The Martin Group
                                        of Companies, Inc.,
                                        a California corporation
                                        Its General Partner


                                        By:
                                           ---------------------------------
                                        Its:
                                           ---------------------------------
                                        Date:
                                             -------------------------------


                                        By:
                                           ---------------------------------
                                        Its:
                                           ---------------------------------
                                        Date:
                                             -------------------------------

                                        2
<PAGE>

                                    Exhibit E

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

Fremont Investment & Loan
175 N. Riverview Drive
Anaheim, California 92808
Attention: Commercial Real Estate
Loan No.: 950113100


--------------------------------------------------------------------------------
                    NONDISTURBANCE AND ATTORNMENT AGREEMENT


         THIS NONDISTURBANCE AND ATTORNMENT  AGREEMENT (the "Agreement") is made
as of _____________________, by and among MARTIN/CAMPUS ASSOCIATES NO.4, L.P., a
Delaware  limited  partnership  ("Landlord"),  whose address is 100 Bush Street,
26th Floor, San Francisco,  California 94104,  ____________________  ("Tenant"),
whose  address is  __________________________and  FREMONT  INVESTMENT  & LOAN, a
California  Industrial  loan  association  ("Lender"),  whose  address is 175 N.
Riverview  Drive,  Anaheim,  California  92808,  Attn:  Commercial  Real  Estate
Department, Loan No. 950113100, with respect to the following Recitals:

                                    RECITALS
                                    --------

         A.  Landlord is the owner of the real  property  described on Exhibit A
attached hereto, together with the improvements now or hereafter located thereon
(collectively, the "Project").

         B.  Landlord  and  Lender  are the  parties  to that  certain  Loan and
Security Agreement of even date herewith (the "Loan Agreement"), pursuant to the
terms of which  Lender has agreed to make a loan of up to Sixteen  Million  Five
Hundred Thousand  Dollars  ($16,500,000)  (the "Loan") to Landlord.  The Loan is
evidenced by that certain Secured Promissory Note of even date herewith,  in the
original  principal amount of the Loan,  executed by Landlord in favor of Lender
(the "Note"). The Note is secured, inter alia, by that certain Deed of Trust and
Fixture Filing of even date herewith  executed by Landlord,  as trustor,  to the
trustee named therein,  in favor of Lender, as beneficiary (the "Deed of Trust")
encumbering the Project,  recorded concurrently herewith in the Official Records
of San Mateo County,  California (the "Official  Records"),  and by that certain
Assignment  of Rents and Leases of even date  herewith  executed  by Landlord in
favor of Lender (the  "Assignment of Rents")  encumbering the Project,  recorded
concurrently herewith in the Official Records. The Loan Agreement, the Note, the
Deed of Trust,  the  Assignment of Rents and all other  documents  securing,  or
executed  in   connection   with,   the  Loan,   together   with  all  renewals,
substitutions,   extensions,   modifications   or  replacements   thereof,   are
collectively referred to herein as the "Loan Documents."

         C. Tenant and  Landlord are the current  parties to that certain  lease
dated   between   Tenant   and   _______________________   between   Tenant  and
Martin/Campus (as amended,  the "Lease"),  pursuant to which Landlord is leasing
to Tenant a portion of the Project more particularly described in the lease (the
"Leased Premises").

<PAGE>

         NOW,  THEREFORE,  in  consideration  of the foregoing  recitals and for
other good and valuable consideration,  the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

         1. Loan Disbursements.

         Tenant  agrees and  acknowledges  that in making  disbursements  of the
Loan, Lender is under no obligation or duty to, nor has Lender  represented that
it will, see to the application of the Loan proceeds by the person or persons to
whom Lender disburses the Loan proceeds,  and any application or use of the Loan
proceeds for purposes other than those provided for in the Loan Documents  shall
not defeat in whole or in part the agreements set forth herein.

         2. Nondisturbance and Attornment.

         If the interest of Landlord under the Lease is transferred by reason of
any  foreclosure  of the  Deed of  Trust  or by deed in lieu or in aid  thereof,
Purchaser (as hereinafter defined) shall be bound to Tenant, and Tenant shall be
bound to  Purchaser,  under all of the terms,  covenants  and  conditions of the
Lease  (except  as  provided  in Section 5 hereof)  for the  balance of the term
thereof,  with the same  force and  effect  as if  Purchaser  were the  original
landlord under the Lease. Tenant does hereby attorn to Purchaser as the landlord
under  the  Lease,  which  attornment  shall  be  effective  and  self-operative
(notwithstanding  whether Tenant is then in default under the Lease) without the
execution of any further instruments upon Purchaser's succeeding to the interest
of the  landlord  under the Lease;  provided,  however,  that  nothing set forth
herein  shall (i) give or be  construed to have given Tenant the right to assert
that the foregoing nondisturbance and attornment agreements are not effective in
the event Tenant is in default  under the Lease,  whether or not any  applicable
notice and cure periods  specifically  provided for under the Lease with respect
to Tenant's  default  have  expired,  and/or (ii) waive or be deemed a waiver by
Purchaser of its rights under the Lease upon Tenant's default  thereunder beyond
any  applicable  notice  and  cure  periods,  regardless  of when  such  default
occurred. Without limiting the generality of this Section 2, within fifteen (15)
calendar  days after the request of Landlord,  Lender or any  Purchaser,  Tenant
shall  execute and deliver such  documents as are  reasonably  requested by such
party to reflect such  attornment.  Within  twenty (20)  calendar days after the
request of any Purchaser or Tenant, such parties shall enter into a new lease of
the Leased  Premises for the balance of the then remaining term of the Lease and
upon the same terms and conditions as are then  contained in the Lease.  As used
herein,  "Purchaser"  shall mean a transferee  (including,  without  limitation,
Lender and its  affiliates  and  subsidiaries)  which  acquires  the interest of
Landlord in the Leased Premises  through a foreclosure of the Deed of Trust or a
deed in lieu or in aid thereof, and its successors and assigns.

         3. Tenant Agreements.

         Tenant agrees that:

         A. Pursuant to Section 34 of the Lease, Tenant shall send a copy of any
notice of a default by Landlord  under the Lease to Lender at the same time such
notice is sent to Landlord; and

         B. without Lender's prior written consent, Tenant shall not (i) pay any
rent  (however  denominated)  or other charges under the Lease more than one (1)
month in advance or (ii) cancel, terminate or surrender the Lease, except at the
normal  expiration  of the Lease term or as  expressly  provided in the Lease or
pursuant to applicable  law. Any amendment or  modification to the Lease entered
into  without  Lender's  prior  written  consent to the extent  such  consent is
required  under the Loan  Documents  shall  not be  binding  upon  Lender or any
Purchaser; and

         C. Upon the  occurence  of any event of default by  Landlord  under the
Loan  Documents and the  expiration  of any  applicable  cure periods  expressly
provided for under the Loan Documents, Lender, at all

                                       2
<PAGE>

times, independent of Landlord, shall have the standing and right to enforce, by
injunction  or  otherwise,  all or any  provisions in the Lease as though Lender
originally was a party thereto.

         4. Assignment of Rents.

         Tenant  agrees to recognize the  assignment  from Landlord to Lender of
the Lease and the amounts payable thereunder pursuant to the Assignment of Rents
and, in the event of any default by Landlord  under the Loan  Documents  and the
expiration of any applicable  cure period  expressly set forth  therein,  Tenant
shall pay to Lender, as such assignee,  the rents and other amounts which are or
become due under the Lease from and after the date on which  Lender gives Tenant
notice that such rent and other amounts are to be paid to Lender pursuant to the
Assignment of Rents.  In complying with the provisions of this Section 4. Tenant
shall be entitled to rely  solely upon the notices  given by Lender  pursuant to
the Assignment of Rents and Landlord hereby indemnifies and agrees to defend and
hold Tenant harmless from and against any and all expenses, loss, claims, damage
or liability arising out of Tenant's  compliance with such notice or performance
of the obligations  under the Lease by the Tenant made in good faith in reliance
on and  pursuant to such  notice.  Tenant shall be entitled to full credit under
the Lease for any rents paid to Lender in accordance with the provisions hereof.
Any  dispute  between  Lender (or any other  Purchaser)  and  Landlord as to the
existence  or  nature  of a  default  by  Landlord  under  the terms of the Loan
Documents  or with  respect to the  foreclosure  of the Deed of Trust,  shall be
dealt with and adjusted  solely  between  Lender (or such other  Purchaser)  and
Landlord,  and  Tenant  shall not be made a party  thereto  (unless  joinder  is
required by law).

         5. Lender's Obligations.

         Nothing in this  Agreement and no action taken by Lender to enforce any
provision in the Lease shall be deemed or construed to  constitute  an agreement
by Lender to perform or assume any  covenant of  Landlord as landlord  under the
Lease  unless  and  until  Lender  obtains  title  to  the  Leased  Premises  by
foreclosure  of the Deed of Trust or a deed in lieu or in aid  thereof.  Without
limiting any of Tenant's  rights against  Landlord under the Lease, in the event
Lender acquires title to the Leased Premises, Lender shall:

         A. be liable only for any damages or other relief  attributable  to any
act or omission  during  Lender's  period of ownership  of the Leased  Premises,
regardless of whether such acts or omissions  commenced  prior to such period of
ownership.  For example,  if the Lease provides that the failure of the Landlord
to repair a hole in the roof  entitles  the Tenant to offset rent for the number
of days that the roof is not  repaired,  and if the hole in the roof occurred 60
days prior to Lender's acquisition of the title and was not repaired for another
30 days  thereafter,  Tenant would only be entitled to offset against its rental
obligations  owed to Lender 30 days  rental  and  would  retain a claim  against
Landlord for 60 days rental;

         B. only be responsible for representations, warranties and covenants of
Landlord to the extent that such representations, warranties and covenants apply
to the Project and relate to the operation of the Project during Lender's period
of ownership of the Leased Premises;

         C. be  liable  only for any  security  deposit  actually  delivered  to
Lender; and

         D. have its obligations  and liabilities  limited to the then interest,
if any, of Lender in the Project,  without  consideration  of any mortgage liens
placed on the Project by Lender.  Tenant shall lock exclusively to such interest
of Lender, if any, in the Project  (including any insurance proceeds thereof and
the  proceeds  of the  sale  thereof)  for  the  payment  and  discharge  of any
obligations imposed upon Lender hereunder or under the Lease and Tenant releases
Lender from any other liability hereunder and under the Lease.

                                       3
<PAGE>

Nothing  contained in this Section  shall be deemed to limit or affect  Tenant's
claims against Landlord for any breaches or the Landlord's obligations under the
Lease,  or for  any  breaches  of  Landlord's  representations,  warranties  and
covenants  under the Lease,  or for  return of any  security  deposit  under the
Lease,  and no transfer of the Project to Lender shall release Landlord from any
of its Lease obligations, notwithstanding anything to the contrary in the Lease.

         6. Estoppel Certificate.

         Pursuant to Section 30 of the Lease,  Tenant agrees, from time to time,
within  fifteen  (15) days after  Lender's  request,  to execute  and deliver to
Lender or Lender's designee,  any estoppel  certificate  reasonably requested by
Lender,  stating  that the Lease is in full force and effect,  the date to which
rent has been  paid,  that  Landlord  is not in  default  under  the  Lease  (or
specifying in detail the nature of Landlord's  default),  and such other matters
relating to the Lease as may be reasonably requested by Lender.

         7. No Merger.

         The  parties  agree  that,  without  Lender's  prior  written  consent,
Landlord's  estate in and to the Project and the leasehold estate created by the
Lease shall not merge but shall remain  separate and  distinct,  notwithstanding
the union of such  estates in  Landlord,  Tenant or any third party by purchase,
assignment or otherwise.

         8. Entire Agreement.

         This Agreement shall be the whole and only agreement with regard to the
matters set forth herein,  and shall  supersede and cancel any prior  agreements
with respect thereto, including, without limitation, any provisions contained in
the Lease relating thereto.

         9. Counterparts.

         This Agreement may be executed in any number of  counterparts,  each of
which when so executed and  delivered  shall be deemed to be an original and all
of which  counterparts  taken  together  shall  constitute  but one and the same
instrument.  Signature  and  acknowledgment  pages  may  be  detached  from  the
counterparts  and attached to a single copy of this Agreement to physically form
one document, which may be recorded.

         10. Modification, Successors and Assigns.

         This  Agreement  may only be modified  in writing  signed by all of the
parties  hereto or their  respective  successors  in interest.  This  Agreement,
including  without  limitation,  the provisions of Section 5, shall inure to the
benefit  of, and be  binding  upon,  the  parties  hereto  and their  respective
successors and assigns.

         11. Attorney's Fees.

         If any lawsuit or other proceeding is commenced which arises out of, or
which  relates  to this  Agreement,  including  any  alleged  tort  action,  the
prevailing party shall be entitled to recover from each other party such sums as
the court or other party presiding over such action or proceeding may adjudge to
be reasonable attorneys' fees and costs in the action or proceeding. In addition
to costs and expenses  otherwise  allowed by law. Any such  attorneys'  fees and
costs  incurred  by any party in  enforcing  a judgment  in its favor under this
Agreement  shall be  recoverable  separately  from and in  addition to any other
amount  included in such  judgment and shall  survive and not be merged into any
such judgment.

                                       4
<PAGE>

The obligation to pay such attorneys' fees and costs is intended to be severable
from the other provisions of this Agreement.

         12. Governing Law.

         This  Agreement  shall be governed  by, and  construed  and enforced in
accordance with, the laws of the State of California.

         13. Notices.

         Any notice,  or other  document or demand  required or permitted  under
this  Agreement  shall be in writing  addressed to the  appropriate  address set
forth above and shall be deemed delivered on the earliest of (a) actual receipt,
(b) the next  business  day after the date  when  sent by  recognized  overnight
courier,  or (c) the second  business day after the date when sent by registered
or certified mail, postage prepaid. Any party may, from time to time, change the
address at which such  written  notices or other  documents or demands are to be
sent,  by giving the other parties  written  notice of such change in the manner
hereinabove provided.

                                       5



<PAGE>
                                    EXHIBIT F

                               MEMORANDUM OF LEASE




RECORDING REQUESTED BY, AND:
WHEN RECORDED, RETURN TO:

-----------------------------

-----------------------------

-----------------------------

-----------------------------

-----------------------------

                               MEMORANDUM OF LEASE


                  THIS MEMORANDUM OF  LEASE("Memorandum"),  dated as of the ____
day of __________,  1999, is made and entered into by and between  MARTIN/CAMPUS
ASSOCIATES  NO.4 ,  L.P.,  a  Delaware  limited  partnership  ("Landlord"),  and
BROADVISION, INC., a Delaware corporation ("Tenant").

RECITALS

                  This  Memorandum is entered into on the basis of the following
facts, understandings and intentions of the parties:

                  A.  Landlord and Tenant have  entered into that certain  Lease
Agreement dated as of January __, 1999 (collectively,  together with any and all
amendments and  supplements  thereto,  hereinafter  referred to as the "Lease").
Pursuant to the terms,  covenants and conditions of the Lease, Tenant has leased
from Landlord a portion of that certain real property (the "Real  Property") and
all improvements thereon, as more particularly described in EXHIBITS A-1 AND A-2
hereto.  That portion of the Real  Property  being leased by Tenant is hereafter
called the "Premises", and is more particularly described in EXHIBIT B hereto. A
copy of the Lease is being held by Tenant at its office at the Premises.

                                        1
<PAGE>
                  B.  Landlord and Tenant  desire to enter into this  Memorandum
which is to be  recorded  in order that  third  parties  may have  notice of the
estate of Tenant in the Premises.

                  NOW THEREFORE,  in  consideration  of the mutual covenants and
promises of the parties, the parties hereto agree as follows:

                  1. LEASE OF PREMISES.  Landlord  leases the Premises to Tenant
and  Tenant  hires the  Premises  from  Landlord,  on the terms,  covenants  and
conditions set forth in the Lease, for the Term, defined in the Lease.

                  2. TERM.  The term of the Lease  shall  commence  on the Lease
Commencement  Date, as defined in the Lease,  and shall terminate on December 4,
2007,  subject  to  extension  by Tenant  for one (1)  period of five (5) years,
pursuant to PARAGRAPH 4 of the Lease (collectively, the "Term").

                  3.  COVENANTS  RUN  WITH  THE  LAND.  All of  the  provisions,
agreements,  rights, powers, covenants,  conditions and obligations contained in
the Lease shall be binding upon and inure to the benefit of the parties  hereto,
their respective heirs,  successors (by merger,  consolidation or otherwise) and
assigns,  devisees,  administrators,  representatives,  lessees,  and all  other
persons acquiring the Premises, or any portion thereof, or any interest therein,
whether  by  operation  of law or in any  manner  whatsoever,  unless  and until
modified as provided in the Lease.  All of the provisions of the Lease,  for the
Term of the Lease,  including any permitted hold-over period, shall be covenants
running with the land pursuant to applicable  law. It is expressly  acknowledged
that each  covenant to do or refrain  from doing some act on the Premises is for
the benefit of the  Premises  and is a burden upon the  Premises,  runs with the
Premises,  and shall benefit or be binding upon each successive owner during its
ownership of the  Premises,  or any portion  thereof,  and each person having an
interest therein derived in any manner through any owner thereof, or any portion
thereof.

                  4. LEASE TO CONTROL. All of the terms, conditions,  provisions
and covenants of the Lease are  incorporated  in this Memorandum by reference as
though written out at length herein and both the Lease and this Memorandum shall
be deemed to constitute a single  instrument or document.  If any  inconsistency
shall exist between the Lease and this Memorandum, the Lease shall control. This
Memorandum and the Lease, and the covenants

                                       2
<PAGE>
and agreements herein and therein contained, shall bind and inure to the benefit
of the parties hereto, their heirs,  successors,  executors,  administrators and
assigns.

                  5.  SIGNATURE  PAGE.  For  convenience,  the signatures of the
parties  to this  Memorandum  may be  executed  on  separate  pages,  which when
attached to this Memorandum shall constitute this as one complete Memorandum.

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

                           "TENANT"

                           BROADVISION, INC.,
                           a Delaware corporation

                                    By:     __________________________
                                    Its:    __________________________


                                    By:     __________________________
                                    Its:    __________________________







                       [SIGNATURES CONTINUE ON NEXT PAGE]

                                        3
<PAGE>
                         "Landlord"

                         MARTIN/CAMPUS ASSOCIATES NO. 4, L.P.,
                         a Delaware limited partnership

                         By:  Martin/Redwood Associates, L.P.,
                              a California limited partnership
                              Its General Partner

                              By:  TMG Redwood LLC,
                                   a California limited liability
                                   company
                                   Its General Partner

                                   By:  The Martin Group
                                        of Companies, Inc.,
                                        a California corporation
                                        Its General Partner


                                        By:
                                           ---------------------------------
                                        Its:
                                           ---------------------------------
                                        Date:
                                             -------------------------------


                                        By:
                                           ---------------------------------
                                        Its:
                                           ---------------------------------
                                        Date:
                                             -------------------------------

attach notaries

                                       4