**EXHIBIT
      10.50**


**AMENDMENT
      NO. 3**


**TO**


**MARINA
      VILLAGE OFFICE TECH LEASE**






THIS
      AMENDMENT NO. 3 TO MARINA VILLAGE OFFICE TECH LEASE (this " **Third
      Amendment** ")
      is
      made and entered into as of November 21, 2006, by and between LEGACY PARTNERS
      I
      ALAMEDA, a Delaware limited liability company (" **Landlord** "),
      and
      INSITE VISION INCORPORATED, a Delaware corporation (" **Tenant** ").




RECITALS :






A.  Alameda
      Real Estate Investments, a California limited partnership (" **Alameda** "),
      and
      Tenant entered into that certain Marina Village Industrial Gross Office Tech
      Lease dated as of September 1, 1996 (the " **Original
      Lease** "),
      pursuant to which Alameda leased to Tenant and Tenant leased from Alameda
      (i) certain premises (the " **Atlantic
      Premises** ")
      commonly known as Suite 100, containing approximately 18,869 rentable
      square feet of space located within that certain building located at 965
      Atlantic Avenue (the " **Atlantic
      Building** "),
      and
      (ii) certain premises (the " **Existing
      Challenger Premises** ")
      commonly known as Suites 103 and 104, containing approximately
      10,533 rentable square feet of space located within that certain building
      located at 2020 Challenger Drive (the " **Challenger
      Building** "),
      all
      as more particularly described in the Original Lease. The Atlantic Premises
      and
      the Existing Challenger Premises are collectively referred to herein as the
      " **Existing
      Premises** ". The
      Existing Premises are part of a multi-building commercial project known as
      "Marina Village" and located on an approximately 200-acre site on the estuary
      side of the island of Alameda (the " **Project** ").




B.  Alameda
      and Tenant entered into that certain Amendment No. 1 to Marina Village
      Office Tech Lease dated as of July 20, 2001 (the " **First
      Amendment** "),
      pursuant to which the parties, among other things, modified
      Tenant's payment of Operating Expenses and Property Taxes .




C.  Alameda
      and Tenant entered into that certain Amendment No. 2 to Marina Village
      Office Tech Lease dated as of August 1, 2003 (the " **Second
      Amendment** "),
      pursuant to which Tenant was provided with a rent credit. The Original Lease,
      the First Amendment and the Second Amendment are collectively referred to herein
      as the " **Lease** ".




D.  Landlord
      has succeeded to the interests of Alameda as landlord under the
      Lease.




E.  Landlord
      and Tenant now desire to amend the Lease to (i) extend the term of the
      Lease for the Existing Premises, (ii) expand the Existing Premises to
      include the certain premises (the " **Expansion
      Space** ")
      commonly known as Suite 100, containing approximately 9,721 rentable square
      feet of space within the Challenger Building and comprising the balance of
      the
      rentable area of the Challenger Building, as depicted on the floor plan attached
      hereto as **Exhibit A** ,
      and
      (iii) modify various terms and provisions of the Lease, all as hereinafter
      provided.


1




F.  All
      capitalized terms when used herein shall have the same meanings given such
      terms
      in the Lease unless expressly superseded by the terms of this Third
      Amendment.




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




1.  Extension
      of Term .
      The
      term of the Lease for the Existing Premises, which is currently scheduled to
      expire on December 31, 2006, is hereby extended for a period of seven (7)
      years (the " **Extended
      Term** ")
      commencing as of January 1, 2007 and continuing until December 31,
      2013 (the " **Extended
      Term Expiration Date** "),
      unless sooner terminated in accordance with the terms of the Lease, as hereby
      amended.




2.  Existing
      Premises Base Rent .




2.1.  Atlantic
      Premises Base Rent .
      Notwithstanding anything in the Lease, as hereby amended, to the contrary,
      commencing on November 1, 2006 and ending on the Extended Term Expiration
      Date, the Base Rent payable by Tenant for the Atlantic Premises shall be paid
      separate and apart from the Base Rent payable for the Existing Challenger
      Premises and the Expansion Space, and shall be as set forth in the following
      schedule:




Period
                of
              Extended
                Term
            Annual
              Base
                Rent
            Monthly
                Installment
              of
                Base Rent
            Monthly
                Rental Rate
              per
                Rentable Square Foot of the Atlantic Premises11/1/06
                - 12/31/06
            $384,927.60
            $32,077.30
            $1.701/1/07
                - 12/31/07
            $396,249.00
            $33,020.75
            $1.751/1/08
                - 12/31/08
            $407,570.40
            $33,964.20
            $1.801/1/09
                - 12/31/09
            $421,156.08
            $35,096.34
            $1.861/1/10
                - 12/31/10
            $432,477.48
            $36,039.79
            $1.911/1/11
                - 12/31/11
            $446,063.16
            $37,171.93
            $1.971/1/12
                - 12/31/12
            $459,648.84
            $38,304.07
            $2.031/1/13
                - 12/31/13
            $473,234.52
            $39,436.21
            $2.09







2




2.2.  Existing
      Challenger Premises Base Rent .
      Notwithstanding anything in the Lease, as hereby amended, to the contrary,
      commencing on November 1, 2006 and ending on the Extended Term Expiration
      Date, the Base Rent payable by Tenant for the Existing Challenger Premises
      shall
      be paid separate and apart from the Base Rent payable for the Atlantic Premises
      and the Expansion Space, and shall be as set forth in the following
      schedule:




Period
                of
              Extended
                Term
            Annual
              Base
                Rent
            Monthly
                Installment
              of
                Base Rent
            Monthly
                Rental Rate
              per
                Rentable Square Foot of the Existing Challenger
                Premises11/1/06
                - 12/31/06
            $157,995.00
            $13,166.25
            $1.251/1/07
                - 12/31/07
            $163,050.84
            $13,587.57
            $1.291/1/08
                - 12/31/08
            $168,106.68
            $14,008.89
            $1.331/1/09
                - 12/31/09
            $173,162.52
            $14,430.21
            $1.371/1/10
                - 12/31/10
            $178,218.36
            $14,851.53
            $1.411/1/11
                - 12/31/11
            $183,274.20
            $15,272.85
            $1.451/1/12
                - 12/31/12
            $188,330.04
            $15,694.17
            $1.491/1/13
                - 12/31/13
            $194,649.84
            $16,220.82
            $1.54




3.  Addition
      of Expansion Space . Commencing
      upon the Expansion Space Commencement Date (as defined in Section 4
      below) ,
      the
      Existing Premises shall be expanded to include the Expansion Space, thereby
      increasing the size of the Existing Premises to 39,123 rentable square feet
      ( i.e. ,
      18,869
      rentable square feet in the Atlantic Premises + 10,533 rentable square feet
      in
      the Existing Challenger Premises + 9,721 rentable square feet in the
      Expansion Space). The Expansion Space shall be leased on the same terms and
      conditions set forth in the Lease, subject to the modifications set forth in
      this Third Amendment. Effective from and after the Expansion Space Commencement
      Date, the " **Premises** "
      shall
      mean the Existing Premises and the Expansion Space.




4.  Expansion
      Space Commencement Date .
      For
      purposes of this Third Amendment, the term " **Expansion
      Space Commencement Date** "
      shall
      mean the earlier of: (i) the date Tenant commences business operations in
      substantially all of the Challenger Building; and (ii) the date of
      Substantial Completion of the Challenger Tenant Improvements (as defined in **Exhibit B** attached
      hereto), subject to acceleration for Tenant Delays as defined and provided
      in **Exhibit B** .
      The
      Expansion Space Commencement Date is anticipated to be April 1, 2007. The term
      of the Expansion Space (the " **Expansion
      Space Term** ")
      shall
      commence on the Expansion Space Commencement Date and expire coterminously
      with
      the Extended Term with respect to the Existing Premises on December 31,
      2013. Notwithstanding the foregoing, if Landlord is unable to Substantially
      Complete the Challenger Tenant Improvements on or before July 1, 2007 (the
      “ **Delivery
      Outside Date** ”),
      as
      such date may be extended as a result of any Tenant Delays and/or any
      prevention, delay or stoppage due to strikes, lockouts, labor disputes, acts
      of
      God, inability to obtain services, labor, or materials or reasonable substitutes
      therefore, governmental actions or inactions, civil commotions, fire or other
      casualty, and other causes beyond the reasonable control of Landlord
      (collectively, the “ **Force
      Majeure** ”),
      then
      Tenant shall receive one-half (1/2) of a day of abated Base Rent for the
      Expansion Space for each day during the period commencing upon the Delivery
      Outside Date (as the same may be extended by Tenant Delays and Force Majeure
      delays) and expiring on the date upon which Landlord Substantially Completes
      the
      Challenger Tenant Improvements (which abated Base Rent shall be applied toward
      the Base Rent first due and payable for the Expansion Space following the
      Expansion Space Commencement Date pursuant to Section 6 below). The date that
      the Expansion Space Commencement Date actually occurs shall be confirmed by
      the
      parties in writing in an Amendment
      No. 4 to Marina Village Office Tech Lease (" **Amendment
      No. 4** "),
      which
      Amendment No. 4 shall be in substantially the form of **Exhibit C** attached
      hereto. Amendment No. 4 shall be delivered by Landlord to Tenant after the
      Expansion Space Commencement
      Date occurs,
      and Tenant shall execute and return such Amendment No. 4 to Landlord within
      five (5) days after Tenant's receipt thereof.


3









5.  Beneficial
      Occupancy .
      Tenant
      shall have the right to occupy the Expansion Space during the period commencing
      on the date of Substantial Completion of the Expansion Space Tenant Improvements
      (as defined in **Exhibit
      B** attached
      hereto) and ending on theExpansion Space Commencement Date (the “ **Beneficial
      Occupancy**  **Period** ”),
      provided that (i) a temporary or permanent certificate of occupancy shall have
      been issued by the appropriate governmental authorities for the Expansion Space,
      (ii) all of the terms and conditions of this Lease shall apply, including,
      without limitation, Tenant’s obligation to pay to Landlord all sums and charges
      required to be paid by Tenant under the Lease, as hereby amended, as though
      the
      Expansion Space Commencement Date had occurred (although the Expansion Space
      Commencement Date shall not actually occur until the date set forth in Section
      4
      above) upon such occupancy of the Expansion Space by Tenant; provided, however,
      during such Beneficial Occupancy Period, Tenant shall not be obligated to pay
      Base Rent for the Expansion Space or Tenant’s Percentage Share of increases in
      Property Taxes and Operating Expenses for the Expansion Space until the
      Expansion Space Commencement Date actually occurs.




6.  Expansion
      Space Base Rent .
      During
      the Expansion Space Term, the Base Rent payable by Tenant for the Expansion
      Space shall be calculated separate and apart from the Base Rent payable for
      the
      Existing Premises ( i.e. ,
      the
      Atlantic Premises and the Existing Challenger Premises), and shall be as set
      forth in the following schedule:




Period
                of Expansion
              Space
                Term
            AnnualBase Rent
            Monthly
                Installment of
              Base
                Rent
            Monthly
                Base Rental Rate per Rentable Square Foot of theExpansion
                Space*Expansion
                Space
              Commencement
              Date
                - 12/31/06
            $145,815.00
            $12,151.25
            $1.25**1/1/07
                - 12/31/07
            $150,481.08
            $12,540.09
            $1.291/1/08
                - 12/31/08
            $155,147.16
            $12,928.93
            $1.331/1/09
                - 12/31/09
            $159,813.24
            $13,317.77
            $1.371/1/10
                - 12/31/10
            $164,479.32
            $13,706.61
            $1.411/1/11
                - 12/31/11
            $169,145.40
            $14,095.45
            $1.451/1/12
                - 12/31/12
            $173,811.48
            $14,484.29
            $1.491/1/13
                - 12/31/13
            $179,644.08
            $14,970.34
            $1.54




*
      Not
      applicable if the E xpansion
      Space Commencement Date occurs after December 31, 2006.




**
      If the
      Expansion Space Commencement Date occurs after January 1, 2007, payment of
      Base Rent at such rental rate shall commence on the Expansion Space Commencement
      Date and not January 1, 2007.


4









**7.**  Tenant's
      Percentage Share .
      Due to
      the revised number of rentable square feet contained within the Premises
      ( i.e. ,
      the
      Existing Premises and the Expansion Space) as compared to the Existing Premises,
      from and after the Expansion Space Commencement Date, the "Tenant's Percentage
      Share" Section of the Basic Lease Information attached to the Original Lease
      of
      the First Amendment shall be deleted in its entirety and replaced with the
      following:




"**Tenant's
                Percentage Share:**
            965
                Atlantic Premises - 18,869 rsf/23,911 rsf = 78.91%2020
                Challenger Premises - 20,254 rsf/20,254 =
                100%"




8.  Tenant
      Improvements .
      Landlord shall construct certain Tenant Improvements (as defined in the Tenant
      Work Letter attached hereto as **Exhibit B** )
      for the
      Premises pursuant to and in accordance with the Tenant Work Letter attached
      to
      this Third Amendment as **Exhibit B** .




9.  Cap
      on
      Controllable Expenses .
      Notwithstanding anything to the contrary contained in the Lease, as hereby
      amended, during the Extended Term, the aggregate Controllable Expenses (as
      hereinafter defined) included in Operating Expenses in any calendar year during
      the Extended Term, shall not increase by more than ten percent (10%)
      on an annual basis, over the actual aggregate Controllable Expenses included
      in
      Operating Expenses for any preceding calendar year. The foregoing cap on
      Controllable Expenses shall not apply to any renewal of the Extended Term and
      shall not apply to Property Taxes. For purposes of this Section 9,
      " **Controllable
      Expenses** "
      shall
      mean all Operating Expenses except: (i) insurance carried by Landlord with
      respect to the Project and/or the operation thereof; and (ii) the cost of
      utilities.




10.  Option
      to Extend Extended Term .
      Landlord hereby grants to Tenant one (1) option to extend the Extended Term
      for
      the entire Premises ( i.e. ,
      the
      Existing Premises and the Expansion Space) for a period of five (5) years
      (" **Option
      Term** "),
      which
      option shall be exercisable only by written Exercise Notice (as defined below)
      delivered by Tenant to Landlord as provided below.




10.1.  Option
      Rent .
      The
      annual Base Rent payable by Tenant during the Option Term (the " **Option
      Rent** ")
      shall
      be equal to the "Fair Market Rental Rate" for the Premises. As used herein,
      the
      " **Fair
      Market Rental Rate** "
      shall
      mean the annual Base Rent at which non-equity tenants, as of the commencement
      of
      the Option Term, will be leasing non-sublease space comparable in size, location
      and quality to the Premises for a comparable term, which comparable space is
      located in the Atlantic Building and/or the Challenger Building, the other
      existing buildings in the Project which are office buildings, and in other
      comparable single story, first-class office buildings in the Alameda Office
      Market (collectively, " **Comparable
      Buildings** "),
      taking into consideration all free rent and other out-of-pocket concessions
      generally being granted at such time for such comparable space for the Option
      Term (including, without limitation, any tenant improvement allowance provided
      for such comparable space, with the amount of such tenant improvement allowance
      to be provided for the Premises during the Option Term to be determined after
      taking into account the age, quality and layout of the tenant improvements
      in
      the Premises as of the commencement of the Option Term with consideration given
      to the fact that the improvements existing in the Premises are specifically
      suitable to Tenant). All other terms and conditions of the Lease, as hereby
      amended, shall apply throughout the Option Term; however, Tenant shall, in
      no
      event, have the option to extend the Extended Term beyond the Option Term
      described in this Section 10.


5




10.2.  Exercise
      of Option .
      The
      option contained in this Section 10 shall be exercised by Tenant, if at
      all, only in the following manner: (i) Tenant shall deliver written notice
      (" **Interest
      Notice** ")
      to
      Landlord not more than twelve (12) months nor less than ten (10) months prior
      to
      the expiration of the Extended Term stating that Tenant may be interested in
      exercising its option; (ii) Landlord, after receipt of Tenant's notice, shall
      deliver notice (the " **Option
      Rent Notice** ")
      to
      Tenant not less than nine (9) months prior to the expiration of the initial
      Lease Term setting forth the Option Rent; and (iii) if Tenant wishes to exercise
      such option, Tenant shall, on or before the date (the " **Exercise
      Date** ")
      which
      is eight (8) months prior to the expiration of the Extended Term, exercise
      the
      option by delivering written notice (" **Exercise
      Notice** ")
      thereof to Landlord. Concurrently with Tenant's delivery of the Exercise Notice,
      Tenant may object, in writing, to Landlord's determination of the Fair Market
      Rental Rate for the Option Term set forth in the Option Rent Notice, in which
      event such Fair Market Rental Rate shall be determined pursuant to Section
      10.3
      below. Tenant's failure to deliver the Interest Notice or Exercise Notice on
      or
      before the applicable delivery dates therefore specified hereinabove shall
      be
      deemed to constitute Tenant's waiver of its extension right hereunder. If Tenant
      timely delivers the Exercise Notice but fails to timely object in writing to
      Landlord's determination of the Fair Market Rental Rate set forth in the Option
      Rent Notice, Tenant shall be deemed to have accepted Landlord's determination
      thereof and the following provisions of Section 10.3 shall not
      apply.




10.3.  Determination
      of Option Rent .
      In the
      event Tenant timely and appropriately objects in writing pursuant to
      Section 10.2 above with respect to the Fair Market Rental Rate initially
      determined by Landlord for the applicable Option Term, then Landlord and Tenant
      shall attempt to agree upon such Fair Market Rental Rate, using their best
      good-faith efforts. If Landlord and Tenant fail to reach agreement by the date
      (the " **Outside
      Agreement Date** ")
      which
      is twenty (20) days following Tenant's delivery of the Exercise Notice ,
      then
      each party shall submit to the other party a separate written determination
      of
      the Fair Market Rental Rate within ten (10) business days after such
      Outside Agreement Date, and such determinations shall be submitted to
      arbitration in accordance with the provisions of Sections 10.3(a) through (g)
      below. The failure of Tenant or Landlord to submit a written determination
      of
      the Fair Market Rental Rate within such ten (10) business day period shall
      conclusively be deemed to be such party's approval of the Fair Market Rental
      Rate submitted within such ten (10) business day period by the other
      party.




(a)  Landlord
      and Tenant shall each appoint one (1) arbitrator who shall by profession be
      a
      real estate leasing broker who shall have (i) been active over the ten (10)
      year period ending on the date of such appointment in the leasing of Comparable
      Buildings, (ii) no financial interest in Landlord or Tenant, and (iii) not
      represented or employed or engaged the appointing party during such 10-year
      period. The determination of the arbitrators shall be limited solely to the
      issue of whether Landlord's or Tenant's submitted Fair Market Rental Rate is
      the
      closer to the actual Fair Market Rental Rate as determined by the arbitrators,
      taking into account the requirements with respect thereto set forth in Section
      10.1 above. Each such arbitrator shall be appointed within fifteen (15) days
      after the applicable Outside Agreement Date.


6




(b)  The
      two
      (2) arbitrators so appointed shall, within fifteen (15) days of the date of
      the
      appointment of the last appointed arbitrator, agree upon and appoint a third
      arbitrator who shall be qualified under the same criteria set forth hereinabove
      for qualification of the initial two (2) arbitrators.




(c)  The
      three
      (3) arbitrators shall, within thirty (30) days of the appointment of the third
      arbitrator, reach a decision as to which of Landlord's or Tenant's submitted
      Fair Market Rental Rate is closer to the actual Fair Market Rental Rate and
      shall select such closer determination as the Fair Market Rental Rate and notify
      Landlord and Tenant thereof.




(d)  The
      decision of the majority of the three (3) arbitrators shall be binding upon
      Landlord and Tenant.




(e)  If
      either
      Landlord or Tenant fails to appoint an arbitrator within the time period
      specified in Section 10.1(a) above, the arbitrator appointed by one of them
      shall reach a decision, notify Landlord and Tenant thereof, and such
      arbitrator's decision shall be binding upon Landlord and Tenant.




(f)  If
      the
      two (2) arbitrators fail to agree upon and appoint a third arbitrator, a third
      arbitrator shall be appointed by the Superior Court in and for the county of
      Alameda, California.




(g)  Each
      party shall pay the fees and expenses of the arbitrator appointed by or on
      behalf of it, and each shall pay one-half of the fees and expenses of the third
      arbitrator, if any.




10.4.  Suspension
      of Right to Extend Extended Term .
      Notwithstanding anything in the foregoing to the contrary, at Landlord's option,
      and in addition to all of Landlord's remedies under the Lease, as hereby
      amended, at law or in equity, the right to extend the Extended Term hereinabove
      granted to Tenant shall not be deemed to be properly exercised if, as of the
      date Tenant delivers the Exercise Notice or as of the end of the Extended Term,
      Tenant is in default under the Lease, as hereby amended. Tenant's right to
      extend the Extended Term under this Section 10 is personal to the original
      Tenant executing this Third Amendment (the " **Original
      Tenant** ")
      and
      any entity or person to which Tenant's entire interest in the Lease has been
      assigned pursuant to Section 12(j) of the Original Lease (each, an
      " **Affiliate** ")
      and
      may not be assigned or exercised, voluntarily or involuntarily, by or to, any
      person or entity other than the Original Tenant or such Affiliate assignee,
      as
      the case may be, and shall only be available to and exercisable by the Original
      Tenant or such Affiliate assignee, as the case may be, when the Original Tenant
      or such Affiliate assignee, as the case may be, is in actual and physical
      possession of the entire Premises.


7









11.  Landlord
      Exculpation .
      It is
      expressly understood and agreed that notwithstanding anything in the Lease,
      as
      hereby amended, to the contrary, and notwithstanding any applicable law to
      the
      contrary, the liability of Landlord and its members, partners, submembers and
      subpartners, and their respective officers, agents, property managers, servants,
      employees, and independent contractors (collectively, " **Landlord
      Parties** ")
      hereunder (including any successor landlord) and any recourse by Tenant against
      Landlord or the Landlord Parties shall be limited solely and exclusively to
      an
      amount which is equal to the interest of Landlord in the Project, and neither
      Landlord, nor any of the Landlord Parties shall have any personal liability
      therefor, and Tenant hereby expressly waives and releases such personal
      liability on behalf of itself and all persons claiming by, through or under
      Tenant.




12.  Miscellaneous
      Deletions .
      The
      following provisions of the Lease are hereby deleted in their entirety and
      are
      of no further force or effect: Paragraph 1 of the Second Amendment;
      clause (iv) of Paragraph 4 of the Lease (as added by Paragraph 1
      of the First Amendment); Paragraph 5 of the First Amendment; and the phrase
      "one
      half of" in Sections  12(f) and 12(g) of the Original Lease.




13.  Broker .
      Tenant
      represents and warrants to Landlord that Tenant has not dealt with any broker
      in
      connection with this Third Amendment except for BT Commercial (the " **Broker** "),
      and
      insofar as Tenant knows, no other broker negotiated or participated in the
      negotiations of this Third Amendment or is entitled to any commission in
      connection herewith. Tenant agrees to indemnify, protect and defend Landlord
      against and hold Landlord harmless from any and all claims, demands, losses,
      liabilities, lawsuits, judgments, and costs and expenses (including without
      limitation reasonable attorneys' fees) with respect to any leasing commissions
      or equivalent compensation alleged to be owing on account of Tenant's dealings
      with any real estate broker or agent, except for the Broker.




14.  No
      Further Modification .
      Except
      as set forth in this Third Amendment, all of the terms and provisions of the
      Lease shall remain unmodified and in full force and effect.




15.  Counterparts . This
      Third Amendment may be executed in multiple counterparts, each of which is
      to be
      deemed original for all purposes, but all of which together shall constitute
      one
      and the same instrument.




[SIGNATURES
      APPEAR ON THE FOLLOWING PAGE]


8




IN
      WITNESS WHEREOF, the parties have caused this Third Amendment to be duly
      executed by their duly authorized representatives as of the date first above
      written.







LANDLORD:
            LEGACY
                PARTNERS I ALAMEDA, LLC,a
                Delaware limited liability company,OwnerBy:
            Legacy
                Partners Commercial, L.P.,a
                California limited partnership,as
                Property Manager and Agent for OwnerBy: 
                Legacy Partners Commercial, Inc.,its
                General PartnerBy:Name:
            Debra
                SmithIts:
            Executive
                Vice PresidentTENANT:
            INSITE
                VISION INCORPORATED,a
                Delaware corporationBy:Name:Title:By:Name:Title:







9


**EXHIBIT
      A**




**DEPICTION
      OF EXPANSION SPACE**




[Attached
      as immediately following page]







EXHIBIT
            A
  1


**EXHIBIT
      B**




**TENANT
      WORK LETTER**




Tenant
      acknowledges and agrees that the Premises ( i.e. ,
      the
      Atlantic Premises, the Existing Challenger Premises and the Expansion Space)
      have previously been constructed including interior tenant improvements therein,
      and are satisfactory and shall be accepted by Tenant in their "AS IS" condition
      as of the date of execution of the Third Amendment to which this Tenant Work
      Letter is attached as **Exhibit B** (the
      " **Third
      Amendment** ")
      and,
      with respect to the Expansion Space, on the Expansion Space Commencement Date;
      provided, however, that Landlord shall construct certain modifications to the
      interior of the Premises ( i.e. ,
      Atlantic Premises, the Existing Challenger Premises and the Expansion Space)
      pursuant to the applicable Approved Working Drawings (as defined below) in
      accordance with the following provisions of this Tenant Work
      Letter.


**SECTION
      4**




**CONSTRUCTION
      DRAWINGS FOR THE** **PREMISES**




1.1  Final
      Space Plans .
      Prior
      to the execution of the Third Amendment, Landlord and Tenant have approved
      (i) a detailed space plan for the construction of certain improvements in
      the Atlantic Premises, which space plan has been prepared by Legacy Partners
      C.D.S., Inc., dated March 27, 2006 (the " **Atlantic
      Final Space Plan** "),
      a
      copy of which is attached hereto as Schedule 1 ,
      and
      (ii) a detailed space plan for the construction of certain improvements in
      the Existing Challenger Premises and the Expansion Space, which space plan
      has
      been prepared by Legacy Partners C.D.S., Inc., dated June 29, 2006 (the
      " **Challenger
      Final Space Plan** "),
      a
      copy of which is attached hereto as Schedule 2 .
      The
      Atlantic Final Space Plan and the Challenger Final Space Plan shall be
      collectively referred to herein as the " **Final
      Space Plans** ".




1.2  Approved
      Working Drawings .




1.2.1  Atlantic
      Approved Working Drawings .
      Based
      upon and in conformity with the Atlantic Final Space Plan, Landlord shall cause
      its architect and engineers to prepare and deliver to Tenant, for Tenant's
      approval, detailed specifications and engineered working drawings for the tenant
      improvements shown on the Atlantic Final Space Plan (the " **Atlantic
      Working Drawings** ").
      The
      Atlantic Working Drawings shall incorporate modifications to the Atlantic Final
      Space Plan as necessary to comply with the floor load and other structural
      and
      system requirements of the Atlantic Building. To the extent that the finishes
      and specifications are not completely set forth in the Atlantic Final Space
      Plan
      for any portion of the tenant improvements depicted thereon, the actual
      specifications and finish work shall be in accordance with the specifications
      for the Atlantic Building's standard improvement package items, as determined
      by
      Landlord. Within five (5) business days after Tenant's receipt of the Atlantic
      Working Drawings, Tenant shall approve or disapprove the same, which approval
      shall not be unreasonably withheld; provided, however, that Tenant may only
      disapprove the Atlantic Working Drawings to the extent such Atlantic Working
      Drawings are inconsistent with the Atlantic Final Space Plan and only if Tenant
      delivers to Landlord, within such five (5) business days period, specific
      changes proposed by Tenant which are consistent with the Atlantic Final Space
      Plan and do not constitute changes which would result in any of the
      circumstances described in items (i) through (iii) hereinbelow. If any such
      revisions are timely and properly proposed by Tenant, Landlord shall cause
      its
      architect and engineers to revise the Atlantic Working Drawings to incorporate
      such revisions and submit the same for Tenant's approval in accordance with
      the
      foregoing provisions, and the parties shall follow the foregoing procedures
      for
      approving the Atlantic Working Drawings until the same are finally approved
      by
      Landlord and Tenant. Upon Landlord's and Tenant's approval of the Atlantic
      Working Drawings, the same shall be known as the " **Atlantic
      Approved Working Drawings** ".
      Once
      the Atlantic Approved Working Drawings have been approved by Landlord and
      Tenant, Tenant shall make no changes, change orders or modifications thereto
      without the prior written consent of Landlord, which consent may be withheld
      in
      Landlord's sole discretion if such change or modification would:
      (i) increase the cost of designing or constructing the Atlantic Tenant
      Improvements (as defined below) above the cost of the tenant improvements
      depicted in the Atlantic Final Space Plan; (ii) be of a quality lower than
      the quality of the standard improvement package items for the Atlantic Building;
      and/or (iii) require any changes to the base, shell and core work or
      structural improvements or systems of the Atlantic Building. The Atlantic Final
      Space Plan, Atlantic Working Drawings and Atlantic Approved Working Drawings
      shall be collectively referred to herein as, the " **Atlantic
      Construction Drawings** ".
      The
      tenant improvements shown on the Atlantic Approved Working Drawings shall be
      referred to herein as the " **Atlantic
      Tenant Improvements** ".


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1.2.2  Challenger
      Approved Working Drawings .
      Based
      upon and in conformity with the Challenger Final Space Plan, Landlord shall
      cause its architect and engineers to prepare and deliver to Tenant, for Tenant's
      approval, detailed specifications and engineered working drawings for the tenant
      improvements shown on the Challenger Final Space Plan (the " **Challenger
      Working Drawings** ").
      The
      Challenger Working Drawings shall incorporate modifications to the Challenger
      Final Space Plan as necessary to comply with the floor load and other structural
      and system requirements of the Challenger Building. To the extent that the
      finishes and specifications are not completely set forth in the Challenger
      Final
      Space Plan for any portion of the tenant improvements depicted thereon, the
      actual specifications and finish work shall be in accordance with the
      specifications for the Challenger Building's standard improvement package items,
      as determined by Landlord. Within three (3) business days after Tenant's receipt
      of the Challenger Working Drawings, Tenant shall approve or disapprove the
      same,
      which approval shall not be unreasonably withheld; provided, however, that
      Tenant may only disapprove the Challenger Working Drawings to the extent such
      Challenger Working Drawings are inconsistent with the Challenger Final Space
      Plan and only if Tenant delivers to Landlord, within such three (3) business
      days period, specific changes proposed by Tenant which are consistent with
      the
      Challenger Final Space Plan and do not constitute changes which would result
      in
      any of the circumstances described in items (i) through (iv) hereinbelow. If
      any
      such revisions are timely and properly proposed by Tenant, Landlord shall cause
      its architect and engineers to revise the Challenger Working Drawings to
      incorporate such revisions and submit the same for Tenant's approval in
      accordance with the foregoing provisions, and the parties shall follow the
      foregoing procedures for approving the Challenger Working Drawings until the
      same are finally approved by Landlord and Tenant. Upon Landlord's and Tenant's
      approval of the Challenger Working Drawings, the same shall be known as the
      " **Challenger
      Approved Working Drawings** ".
      Once
      the Challenger Approved Working Drawings have been approved by Landlord and
      Tenant, Tenant shall make no changes, change orders or modifications thereto
      without the prior written consent of Landlord, which consent may be withheld
      in
      Landlord's sole discretion if such change or modification would:
      (i) directly or indirectly delay the Substantial Completion of the
      Challenger Tenant Improvements (as defined in Section 3.1 below);
      (ii) increase the cost of designing or constructing the Challenger Tenant
      Improvements (as defined below) above the cost of the tenant improvements
      depicted in the Challenger Final Space Plan; (iii) be of a quality lower
      than the quality of the standard improvement package items for the Challenger
      Building; and/or (iv) require any changes to the base, shell and core work
      or structural improvements or systems of the Challenger Building. The Challenger
      Final Space Plan, Challenger Working Drawings and Challenger Approved Working
      Drawings shall be collectively referred to herein as, the " **Challenger
      Construction Drawings** ".
      The
      tenant improvements shown on the Challenger Approved Working Drawings shall
      be
      referred to herein as the " **Challenger
      Tenant Improvements** ".
      The
      Challenger Tenant Improvements which relate specifically and only to the
      Expansion Space shall be referred to herein as the “ **Expansion
      Space Tenant Improvements** ”.


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1.2.3  Definitions .
      For
      purposes of this Tenant Work Letter, (i) the Atlantic Approved Working
      Drawings and the Challenger Approved Working Drawings shall be collectively
      referred to herein as the " **Approved
      Working Drawings** ",
      (ii) the Atlantic Working Drawings and the Challenger Working Drawings
      shall be collectively referred to herein as the " **Working
      Drawings** ",
      (iii) the Atlantic Construction Drawings and the Challenger Construction
      Drawings shall be collectively referred to herein as the " **Construction
      Drawings** ",
      and
      (iv) the Atlantic Tenant Improvements and the Challenger Tenant
      Improvements shall be collectively referred to herein as the " **Tenant
      Improvements** ".




**SECTION
      4**




**CONSTRUCTION
      AND COST OF TENANT IMPROVEMENTS**






Landlord
      shall cause a contractor designated by Landlord (the " **Contractor** ")
      to
      (i) obtain all applicable building permits for construction of the
      applicable Tenant Improvements (collectively, the " **Permits** "),
      and
      (ii) construct the applicable Tenant Improvements as depicted on the
      applicable Approved Working Drawings therefor, in compliance with such
      applicable Permits and all applicable laws in effect at the time of
      construction, and in good workmanlike manner. Except as otherwise provided
      in
      this Tenant Work Letter, Landlord shall pay for the cost of the design and
      construction of the Tenant Improvements. The cost of the design and construction
      of the Tenant Improvements shall include Landlord's construction supervision
      and
      management fee in an amount equal to the product of (i) five percent (5%)
      and (ii) the total cost of the design and construction of the Tenant
      Improvements. In the event Tenant requests any changes, change orders or
      modifications to the applicable Working Drawings and/or the Approved Working
      Drawings for the applicable Tenant Improvements (which Landlord approves
      pursuant to Section 1 above) which increase the cost to construct such
      applicable Tenant Improvements above the cost of the applicable tenant
      improvements as described in the applicable Final Space Plan therefor, then
      Tenant shall pay such increased cost to Landlord immediately upon Landlord's
      request therefor, and, in any event, prior to the date Landlord causes the
      Contractor to commence construction of the applicable changes, change orders
      or
      modifications. In no event shall Landlord be obligated to pay for any of
      Tenant's furniture, computer systems, telephone systems, equipment or other
      personal property which may be depicted on the applicable Construction Drawings;
      such items shall be paid for by Tenant.


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**SECTION
      3**




**SUBSTANTIAL
      COMPLETION OF THE EXPANSION SPACE/CHALLENGER BUILDING**






1.0  Substantial
      Completion .
      For
      purposes of the Third Amendment and this Tenant Work Letter: " **Substantial
      Completion of the Expansion Space Tenant Improvements** "
      shall
      occur upon the completion of construction of the Expansion Space Tenant
      Improvements pursuant to the Challenger Approved Working drawings which relate
      specifically to the Expansion Space Tenant Improvements, with the exception
      of
      (A) any punch list items ( i.e. ,
      minor
      defects or conditions in the Expansion Space Tenant Improvements that do not
      materially and adversely interfere with Tenant's use and occupancy of the
      Expansion Space for the permitted use set forth in the Lease, (which punchlist
      items shall be completed by Landlord as provided in Section 3.3 below); and
      (B) any tenant fixtures, work-stations, built-in furniture, or equipment to
      be installed by Tenant or under the supervision of Contractorin the Expansion
      Space and (ii) “ **Substantial
      Completion of the Challenger Building** ”
shall
      occur upon completion of construction of the entire Challenger Tenant
      Improvements pursuant to the Challenger Approved Working Drawings, with the
      exception of (1) any punch list items ( i.e .,
      minor
      defects or conditions in the Challenger Tenant Improvements that do not
      materially and adversely interfere with Tenant’s use and occupancy of the
      Challenger Building for the permitted use set forth in the Lease (which
      punchlist items shall be completed by Landlord as provided in Section 3.3
      below), (2) any tenant fixtures, work-stations, built-in furniture, or equipment
      to be installed by Tenant or under the supervision of Contractor in the
      Challenger Building and (3) the fire suppression system to be installed in
      the
      Challenger Building as part of the Challenger Tenant Improvements.




2.0  Delay
      of the Substantial Completion of the Challenger Tenant
      Improvements .
      If
      there shall be a delay or there are delays in the Substantial Completion of
      the
      Challenger Tenant Improvements as a direct, indirect, partial, or total result
      of any of the following (collectively, " **Tenant
      Delays** "):




1.0.0  Tenant's
      failure to timely approve the Challenger Working Drawings or any other matter
      requiring Tenant's approval;




2.0.0  a
      breach
      by Tenant of the terms of this Tenant Work Letter or the Lease, as amended
      by
      the Third Amendment;




3.0.0  Tenant's
      request for changes in any of the Challenger Construction Drawings;




4.0.0  Tenant's
      requirement for materials, components, finishes or improvements for the
      Challenger Tenant Improvements which are not available in a commercially
      reasonable time given the estimated date of Substantial Completion of the
      Challenger Tenant Improvements, as set forth in the Third Amendment, or which
      are different from, or not included in, Landlord's standard improvement package
      items for the Challenger Building;


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5.0.0  changes
      to the base, shell and core work, structural components or structural components
      or systems of the Challenger Building required by the Challenger Approved
      Working Drawings, but only to the extent that such changes result from changes
      to any of the Construction Drawings requested by Tenant;




6.0.0  Tenant’s
      interference with the construction of the Challenger Tenant Improvements during
      Tenant’s occupancy of the Existing Challenger Premises and/or the Expansion
      Space after the date upon which Tenant occupies same; or




7.0.0  any
      other
      acts or omissions of Tenant, or its agents, or employees;




then,
      notwithstanding anything to the contrary set forth in the Lease, as amended
      by
      the Third Amendment, and regardless of the actual date of Substantial Completion
      of the Challenger Tenant Improvements, the Expansion Space Commencement Date
      (as
      set forth in Section 4 of the Third Amendment) shall be deemed to be the
      date the Expansion Space Commencement Date would have occurred if no Tenant
      Delay or Delays, as set forth above, had occurred.




3.0  Punch-List .
      Within
      ten (10) days after the date of Substantial Completion of the
      Expansion Space Tenant Improvements and/or the Substantial Completion of the
      Challenger Tenant Improvements, as applicable, Landlord's and Tenant's
      respective representatives shall inspect the Expansion Space and/or the entire
      Challenger Building, as applicable, and identify the punch-list items of the
      Expansion Space Tenant Improvements and/or the Challenger Tenant Improvements,
      as applicable, described in Section 3.1(i)(A) and 3.1(ii)(1) above,
      respectively, and jointly prepare a written list of such punch-list items.
      Landlord shall diligently complete all punch-list items set forth on such list
      as soon as reasonably possible thereafter. Landlord shall, however, be under
      no
      obligation to repair any damage caused by Tenant in connection with Tenant's
      move into the Expansion Space and/or the entire Challenger Building, as
      applicable, the exercise by Tenant of its rights under Section 4.1 below
      and/or otherwise caused by Tenant, all of which shall be repaired by Tenant
      at
      Tenant's cost.







**SECTION
      4**




**MISCELLANEOUS**






4.1  Access
      to Expansion Space .
      Provided that Tenant and its agents do not interfere with Contractor's work
      in
      the Expansion Space, Contractor shall (i) notify Tenant at least ten (10)
      days prior to the expected date of Substantial Completion of the Expansion
      Space
      Tenant Improvements, and (ii) allow Tenant access immediately following
      such notification for the purpose of Tenant installing overstandard equipment
      or
      fixtures (including Tenant's data and telephone equipment) in the Expansion
      Space. Prior to Tenant's entry into the Expansion Space as permitted by the
      terms of this Section 4.1, Tenant shall submit a schedule to Landlord and
      Contractor, for their approval, which schedule shall detail the timing and
      purpose of Tenant's entry. Tenant shall hold Landlord harmless from and
      indemnify, protect and defend Landlord against any loss or damage to the
      Expansion Space, the Challenger Building and/or the Project and against injury
      to any persons caused by Tenant's actions pursuant to this
      Section 4.1.


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4.2  Occupancy
      of Existing Premises and Expansion Space During Construction of Tenant
      Improvements . Tenant
      acknowledges that Contractor will be constructing the Tenant Improvements during
      Tenant's occupancy of the Existing Premises (and the Expansion Space after
      the
      date upon which Tenant occupies same) under the Lease, as hereby amended, and
      Tenant agrees that: (i) Tenant shall cooperate with Contractor and
      Contractor's schedule of construction of the Tenant Improvements during such
      occupancy so that Contractor may timely construct the Tenant Improvements
      without unreasonable interference from Tenant; (ii) Landlord
      shall be permitted to cause the Tenant Improvements to be constructed during
      normal business hours as reasonably necessary to complete the same in a timely
      manner, without any obligation to pay overtime or other premiums;
      (iii) Tenant shall accept any and all inconveniences associated with the
      construction of the Tenant Improvements which may occur during such occupancy,
      including without limitation, dust, noise, etc; and (iv) the construction of
      the
      Tenant Improvements shall not (A) constitute a constructive eviction of
      Tenant, (B) subject Landlord to any liability for injury to or interference
      with Tenant's business arising from such construction or (C) entitle Tenant
      to any abatement of rent or damages from Landlord for loss of the use of any
      part of the Existing Premises (and the Expansion Space after the date upon
      which
      Tenant occupies same) or Tenant's personal property or improvements therein
      or
      for any inconvenience or annoyance occasioned by the Tenant Improvements, except
      for any injury to persons in the Existing Premises (and the Expansion Space
      after the date upon which Tenant occupies same) or damage to property in the
      Existing Premises and the Expansion Space after the date upon which Tenant
      occupies same (but not loss of business or other consequential damages) to
      the
      extent caused by Landlord's negligence or willful misconduct and not insured
      or
      required to be insured by Tenant under the Lease, as hereby amended .
      Notwithstanding anything in the foregoing to the contrary, Landlord shall use
      commercially reasonable efforts to minimize unreasonable interference with
      Tenant's use and occupancy of the Existing Premises (and the Expansion Space
      after the date upon which Tenant occupies same) as a result of the construction
      of the Tenant Improvements.







EXHIBIT
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**EXHIBIT
      C**




**AMENDMENT
      NO. 4**


**TO**


**MARINA
      VILLAGE OFFICE TECH LEASE**






THIS
      AMENDMENT NO. 4 TO MARINA VILLAGE OFFICE TECH LEASE (this " **Fourth
      Amendment** ")
      is
      made and entered into as of __________, 200___, by and between LEGACY PARTNERS
      I
      ALAMEDA, a Delaware limited liability company (" **Landlord** "),
      and
      INSITE VISION INCORPORATED, a Delaware corporation (" **Tenant** ").




RECITALS :






A.  Alameda
      Real Estate Investments, a California limited partnership (" **Alameda** "),
      and
      Tenant entered into that certain Marina Village Industrial Gross Office Lease
      dated September 1, 1996 (the " **Original
      Lease** "),
      pursuant to which Alameda leased to Tenant and Tenant leased from Alameda
      (i) certain premises (the " **Atlantic
      Premises** ")
      commonly known as Suite 100, containing approximately 18,869 rentable
      square feet of space within that certain building located at 965 Atlantic Avenue
      (the " **Atlantic
      Building** "),
      and
      (ii) certain premises (the " **Existing
      Challenger Premises** ")
      commonly known as Suites 103 and 104, containing approximately
      10,533 rentable square feet of space within that certain building located
      at 2020 Challenger Drive (the " **Challenger
      Building** "),
      all
      as more particularly described in the Original Lease. The Atlantic Premises
      and
      the Existing Challenger Premises are collectively referred to herein as the
      " **Existing
      Premises** ". The
      Original Premises are part of a multi-building commercial project known as
      "Marina Village" and located on an approximately 200-acre site on the estuary
      side of the island of Alameda (the " **Project** ").




B.  Alameda
      and Tenant entered into that certain Amendment No. 1 to Marina Village
      Office Tech Lease dated as of July 20, 2001 (the " **First
      Amendment** "),
      pursuant to which the parties, among other things, modified
      Tenant's payment of Operating Expenses and Property Taxes .




C.  Alameda
      and Tenant entered into that certain Amendment No. 2 to Marina Village
      Office Tech Lease dated as of August 1, 2003 (the " **Second
      Amendment** "),
      pursuant to which Tenant was provided with a rent credit.




D.  Landlord
      succeeded to the interests of Alameda as landlord under the Lease.




E.  Landlord
      and Tenant entered into that certain Amendment No. 3 to Marina Village
      Office Tech Lease dated as of November 21, 2006 (the " **Third
      Amendment** "),
      pursuant to which the Existing Premises were expanded to include approximately
      9,721 rentable square feet of space commonly known as Suite 100 (the
      " **Expansion
      Space** ")
      and
      comprising the balance of the rentable area of the Challenger Building. The
      Existing Premises and the Expansion Space are collectively referred to herein
      as
      the " **Premises** ".
      The
      Original Lease, the First Amendment, the Second Amendment and the Third
      Amendment are collectively referred to herein as the " **Lease** ".


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F.  Except
      as
      otherwise set forth herein, all capitalized terms used in this Fourth Amendment
      shall have the same meaning as given such terms in the Lease.




G.  Landlord
      and Tenant desire to amend the Lease to confirm the Expansion Space Commencement
      Date, as hereinafter provided.




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




1.  Confirmation
      of Dates .
      The
      parties hereby confirm that (i) Substantial Completion of the Challenger Tenant
      Improvements has occurred and (ii) the Expansion Space Term commenced as of
      ________________ (the " **Expansion
      Space Commencement Date** ")
      for a
      term ending on December 31, 2013 (unless sooner terminated as provided in
      the Lease, as hereby amended, or extended pursuant to Section 10 of the
      Third Amendment).




2.  No
      Further Modification .
      Except
      as set forth in this Fourth Amendment, all of the terms and provisions of the
      Lease shall remain unmodified and in full force and effect.




**[SIGNATURES
      APPEAR ON THE FOLLOWING PAGE]**


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IN
      WITNESS WHEREOF, this Fourth Amendment to Lease has been executed as of the
      day
      and year first above written.




LANDLORD:
            LEGACY
                PARTNERS I ALAMEDA, LLC,a
                Delaware limited liability company,
              OwnerBy:
            Legacy
                Partners Commercial, L.P.,a
                California limited partnership,as
                Property Manager and Agent for OwnerBy:
            Legacy
                Partners Commercial, Inc.,its
                General PartnerBy:Name:
                Debra SmithIts:
                Executive Vice PresidentTENANT:
            INSITE
                VISION INCORPORATED,a
                Delaware corporationBy:Name:Title:By:Name:Title:









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