Document:

<PAGE>

                                                                    EXHIBIT 10.6

                                    SUBLEASE

                                     between

                            LUCENT TECHNOLOGIES INC.,

                                 as Sublandlord

                                       and

                         PENINSULA PHARMACEUTICALS INC.

                                  as Subtenant

                      1701 Harbor Bay Parkway, Alameda, CA

DATED:  October 30, 2002

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                                TABLE OF CONTENTS

<TABLE>
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                                                                                                                     PAGE
<S>                                                                                                                  <C>
1.       Demise..................................................................................................      1

2.       Sublease Subject And Subordinate To Prime Lease.........................................................      2

3.       Sublandlord's Obligations Under Prime Lease.............................................................      3

4.       Limitations On Sublandlord's Liability..................................................................      3

5.       Term....................................................................................................      4

6.       Condition Of The Subleased Premises, Completion Of Work And Occupancy Of The Subleased Premises
         By Subtenant............................................................................................      4

7.       Rent....................................................................................................      6

8.       Subtenant's Share Of Operating Costs And Taxes..........................................................      7

9.       Use....................................................................................................      10

10.      Compliance With Laws...................................................................................      10

11.      Environmental Compliance...............................................................................      11

12.      Repairs And Maintenance................................................................................      11

13.      Services And Utilities.................................................................................      12

14.      Alterations............................................................................................      14

15.      Assignment And Subletting..............................................................................      16

16.      Damage Or Destruction..................................................................................      18

17.      Eminent Domain.........................................................................................      18

18.      Insurance..............................................................................................      19

19.      Subrogation And Waiver.................................................................................      20

20.      Release And Indemnity..................................................................................      20

21.      Subordination..........................................................................................      21

22.      Rights Reserved To Sublandlord.........................................................................      21

23.      Rules And Regulations..................................................................................      22

24.      Default, Rights And Remedies...........................................................................      22

25.      Expiration And Termination Of Sublease And Holding Over................................................      24

26.      Quiet Enjoyment........................................................................................      25

27.      Sublandlord's And Subtenant's Power To Execute.........................................................      25

28.      Estoppel Certificate...................................................................................      26

29.      No Recording...........................................................................................      26
</TABLE>

                                      -i-

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                               TABLE OF CONTENTS
                                  (CONTINUED)

<TABLE>
<CAPTION>
                                                                                                                     PAGE
<S>                                                                                                                  <C>
30.      Default Interest.......................................................................................      26

31.      Governing Law..........................................................................................      26

32.      Notices................................................................................................      26

33.      Limitation Of Liability................................................................................      27

34.      Subtenant's Property And Other Taxes...................................................................      27

35.      Non-Waiver.............................................................................................      28

36.      Entire Agreement.......................................................................................      28

37.      Binding Effect.........................................................................................      28

38.      Consent Of Prime Landlord..............................................................................      28

39.      Brokers................................................................................................      29

40.      Time...................................................................................................      29

41.      Security Deposit.......................................................................................      29

42.      Renewal Option.........................................................................................      30

43.      Waiver Of Trial By Jury................................................................................      33

44.      Counterparts...........................................................................................      33

45.      Severability...........................................................................................      33

46.      Notice And Cure Rights Of Sublandlord..................................................................      33

47.      Sublandlord's Reserved Rights..........................................................................      33

SIGNATURES......................................................................................................      36

EXHIBIT A  THE SUBLEASED PREMISES...............................................................................      37

EXHIBIT B  FURNITURE............................................................................................      38

EXHIBIT C  WIRING...............................................................................................      39

EXHIBIT D  CLEANING SPECIFICATIONS..............................................................................      40

EXHIBIT E  RULES AND REGULATIONS................................................................................      43

EXHIBIT F  LETTER OF CREDIT.....................................................................................      48
</TABLE>

                                      -ii-

<PAGE>

                               SUBLEASE AGREEMENT

         THIS SUBLEASE AGREEMENT ("Sublease") made as of this 30th day of
October, 2002 by and between LUCENT TECHNOLOGIES INC., a Delaware corporation
("SUBLANDLORD"), and PENINSULA PHARMACEUTICALS INC., a Delaware corporation
("SUBTENANT").

                                   WITNESSETH:

         WHEREAS, Sublandlord, as tenant, entered into that certain Master Lease
of Land and Improvements dated as of May 4,2000, with SUMITOMO BANK LEASING AND
FINANCE, INC., a Delaware corporation, as landlord ("Prime Landlord") (such
Master Lease together with all exhibits, including without limitation the Lease
Supplements and Operative Documents (as such terms are defined in such Master
Lease), schedules and other attachments thereto, and as amended or modified from
time to time, being herein referred to as the "PRIME LEASE"); with respect to
certain land and property including the Lucent Technologies Campus, Harbor Bay
Parkway, Alameda, California, consisting of 6 buildings containing a total of
approximately 380,000 rentable square feet of space as more particularly
described therein (the "PROPERTY");

         WHEREAS, Subtenant acknowledges and agrees that it has received a copy
of the Prime Lease, and that Subtenant has reviewed the same and is familiar
with the terms and provisions thereof,

         WHEREAS, Subtenant desires to sublease from Sublandlord the space shown
on Exhibit A hereto (the "Subleased Premises") which Subleased Premises shall be
deemed to contain approximately 7,500 rentable square feet) on a portion of the
first floor of the building located at 1701 Harbor Bay Parkway, Alameda,
California (the "Building") which Building is deemed to contain for purposes of
this Sublease 58,034 rentable square feet; and

         WHEREAS, Sublandlord is willing to sublease the Subleased Premises to
Subtenant, subject to the terms and conditions hereof

         NOW THEREFORE, Sublandlord and Subtenant, in consideration of the
mutual promises and covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
each with intent to be legally bound, for themselves and their respective
successors and assigns, agree as follows:

         1.       Demise.

                  (a)      Subject to the terms and provisions of this Sublease,
Sublandlord hereby demises and subleases to Subtenant and Subtenant hereby
accepts and subleases from Sublandlord, 7,500 rentable square feet of space
located on the first floor of the Building as more particularly shown on the
floor plan which is attached hereto as Exhibit A (the "Subleased Premises").
Sublandlord further confers upon Subtenant, and Subtenant accepts from
Sublandlord, a non-exclusive right and license (in common with Sublandlord,
other tenants, subtenants, licensees or occupants of the Building and Property,
including Sublandlord) to use the common areas of the Building for ingress and
egress to and from the Subleased Premises, subject to the terms and conditions
of the Prime Lease and this Sublease.

                                       1.

<PAGE>

                  (b)      Sublandlord reserves the right without Subtenant's
consent, on one-hundred and twenty (120) days' written notice to Subtenant, to
substitute other premises within one of the buildings on the Property, provided
that:

                           (i)      the substituted premises are substantially
         similar and contain net rentable square footage equal to or greater
         than the Subleased Premises and the improvements in the substituted
         premises are of the same or greater level and quality as in the
         Subleased Premises;

                           (ii)     the rental rate shall be the same as then
         existing under this Sublease, and Subtenant shall not be obligated to
         pay for more square footage than in the original Subleased Premises;

                           (iii)    The Sublandlord or any new Landlord,
         provides Subtenant with an option to extend then current Term of this
         lease for an additional 24 months at Fair Market Rent (as defined in
         Section 42(b)).

Subtenant shall cooperate with Sublandlord in connection with the relocation,
including, without limitation, timely responding to any requests for review and
approval of proposed plans for tenant improvements for and configuration of the
substituted premises. Sublandlord shall pay all of Subtenant's reasonable out of
pocket costs of the following expenses incidental to such substitution of
premises: (1) physical movement of Subtenant's furniture and all of the
furniture currently supplied to Subtenant by Sublandlord, furnishings,
equipment, books and files, signage, Subtenant's improvements, from the
Subleased Premises to the substituted premises, (2) installation, wiring and
hook-up charges for Subtenant's telephone, computer and related equipment, (3)
relocation and installation of photocopy and word processing equipment, if any,
located in the Subleased Premises, (4) a reasonable supply of new stationery and
business cards, not in excess of a one-hundred and eighty (180) day supply, if
Subtenant determines, in its sole discretion, that Subtenant's stationery and
business cards in use at the date of Sublandlord's notice would be rendered
obsolete by virtue of such substitution, (5) any costs associated with
modifying, relabeling, reworking, or any other required modifications of the
Subtenants products, samples, supplies, inventory and/or any other items
requiring changes as a result of the substitution, (6) costs associated with the
notification of the relocation with customers, vendors, employees, consultants,
partners, regulatory authorities, and any other key contacts provided that the
aggregate total of all out-of-pocket costs shall not exceed $100,000.00, (7) new
signage, if needed, and (8) all other actual costs related to the actual move.

         2.       Sublease Subject and Subordinate to Prime Lease.

                  (a)      This Sublease (and any and all of Subtenant's rights
and Sublandlord's obligations hereunder) is subject to all of the terms and
provisions of, and is subordinate to, the Prime Lease. In the event of the
termination of the Prime Lease for any reason, or the termination of the
Sublandlord's right of possession of the Subleased Premises for any reason, then
this Sublease shall automatically terminate concurrently therewith. Subtenant
agrees: (i) to accept performance by Sublandlord of any of the terms, provisions
and agreements contained in this Sublease which are obligations of Sublandlord
under this Sublease, and (ii) to the extent Sublandlord elects (in its sole and
absolute discretion) to perform any of the duties or obligations of the Prime
Landlord under the Prime Lease, to accept such performance by Sublandlord.

                                       2.

<PAGE>

                  (b)      Upon any termination of the Prime Lease and provided
Subtenant is not in default of this Sublease, Subtenant shall be obligated at
Prime Landlord's written election (which election must be consented to by Lender
(as such term is defined in the Prime Lease), if any), to attorn to and
recognize Prime Landlord as the lessor under this Sublease, whereupon this
Sublease shall continue as a direct lease between the Subtenant and Prime
Landlord upon all the terms and conditions of this Sublease.

                  (c)      Subtenant agrees that it shall take no action in
violation of the Prime Lease.

         3.       Sublandlord's Obligations under Prime Lease.

                  (a)      Provided that an Event of Default (as hereinafter
defined) shall not have occurred hereunder, Sublandlord shall perform those
obligations of the "Tenant" under the Prime Lease (including, without
limitation, the payment of "Base Rent" and "Additional Rent").

                  (b)      Sublandlord. shall take all such actions as are
reasonable to cause Prime Landlord's compliance with the terms and provisions of
the Prime Lease to the extent such terms and provisions relate to the Subleased
Premises provided, however, that, Sublandlord shall have no obligation to
exercise or enforce any self-help rights of Sublandlord under the Prime Lease or
otherwise, and Sublandlord shall have no obligation to make any out-of-pocket
expenditures in connection therewith or to institute (or threaten to institute)
any legal proceedings. Notwithstanding anything to the contrary contained in the
foregoing or elsewhere in this Sublease, Sublandlord shall have no liability to
Subtenant for Prime Landlord's failure to: (i) comply with any of the terms or
provisions of the Prime Lease or (ii) perform any of Prime Landlord's
obligations thereunder.

         4.       Limitations on Sublandlord's Liability.

                  (a)      Sublandlord shall not be required to perform any of
the obligations of the Prime Landlord under the Prime Lease, and insofar as any
of the obligations of the Sublandlord hereunder are required to be performed
under the Prime Lease by the Prime Landlord thereunder, Subtenant shall rely on
and look solely to the Prime Landlord for the performance thereof. If the Prime
Landlord shall default in the performance of any of its obligations under the
Prime Lease pertaining to the Subleased Premises, Subtenant shall have the
right, at Subtenant's expense and upon prior notice to Sublandlord and in the
name of Sublandlord to make any demand or institute any action or proceeding, in
accordance with and not contrary to any provision of the Prime Lease, against
the Prime Landlord under the Prime Lease for the enforcement of the Prime
Landlord's obligations thereunder. Subtenant shall defend, indemnify and hold
Sublandlord harmless from and against any suit, action, cost, expense, damage or
liability which arises out of or results from or is alleged to arise out of or
result from Subtenant's exercise of its rights under this subsection, and
Subtenant shall provide to Sublandlord such security for said indemnity as
Sublandlord may in its discretion deem appropriate. The foregoing
indemnification shall survive the expiration or earlier termination of this
Sublease. No such failure or refusal shall constitute an eviction, actual or
constructive, and shall not be entitled to cancel this Sublease or to any
abatement of the Rent reserved herein.

                  (b)      Notwithstanding anything to the contrary contained in
this Sublease, any covenants, representations, indemnifications or other
undertakings of Prime Landlord under the

                                       3.

<PAGE>

Prime Lease shall not be deemed to be made by, or otherwise constitute
obligations of Sublandlord under this Sublease.

                  (c)      Notwithstanding anything to the contrary contained in
the foregoing or elsewhere in this Sublease, Sublandlord shall have no liability
to Subtenant for Prime Landlord's failure to: (i) comply with any of the terms
or provisions of the Prime Lease or (ii) perform any of Sublandlord's
obligations thereunder.

         5.       Term.

                  (a)      The initial term of this Sublease (the "Term") shall
commence on the later to occur (such date being the "Commencement Date") of (i)
November 1, 2002; or (ii) the earlier of (x) December 1, 2002 and (y) occupancy
of the Subleased Premises by Subtenant for the purpose of the conduct of
Subtenant's business, and shall end, unless sooner terminated as provided herein
or pursuant to law, at 11:59 a.m. on July 31, 2004 (the "Expiration Date");
provided however, the Term may be extended if the renewal option contained in
this Sublease, if any, is duly exercised. The Term shall include any Renewal
Term which duly becomes effective as provided in this Sublease.

                  (b)      Following the Commencement Date, the parties shall,
at either party's request, execute a supplemental agreement to become a part
hereof setting forth the Commencement Date, as determined under the provisions
of this Section 5. The parties' failure to execute such supplemental agreement
shall in no way affect the rights and /or obligations' of the parties hereto.

                  (c)      Provided that Subtenant complies at all times with
the provisions and requirements of this Sublease (other than the obligation to
pay Rent (as defined in Section 8 hereof), Subtenant may enter upon the
Subleased Premises prior to the Commencement Date to install trade fixtures,
furnishings, and telecommunications equipment and cabling and to make the
Subleased Premises ready for the conduct of Subtenant's business, provided,
however, that Subtenant does not interfere with the use of the balance of the
Building by Sublandlord and others, and provided further that such contractors
as Subtenant may engage to undertake such installations and other preparatory
work shall be subject to Sublandlord's written approval prior to engagement and
that Subtenant shall undertake such installations and other preparatory work
only with such labor organization affiliation or lack of affiliation as
Sublandlord may reasonably approve. Subtenant shall not be obligated to pay for
electricity, HVAC and other services furnished to the Subleased Premises upon
Subtenant's entry pursuant to this Section 5 (c). However, Sublandlord does not
assume responsibility for the availability of any services during the period
prior to the Commencement Date.

         6.       Condition of the Subleased Premises, Completion of Work and
Occupancy of the Subleased Premises by Subtenant.

                  (a)      Condition of the Subleased Premises. Neither
Sublandlord nor Sublandlord's agents have made any representations or promises
with respect to the physical condition of the Property or the Building, the
Subleased Premises, permissible uses of Subleased Premises, the rents, leases,
expenses of operation or any other matter or thing affecting or related to the
Subleased Premises except as herein expressly set forth, and no rights,
easements, or licenses are acquired by Subtenant by implication or otherwise
except as expressly set forth in the provisions of this Sublease. Subtenant has
inspected the Building and the Subleased

                                       4.

<PAGE>

Premises and is thoroughly acquainted with their condition, and agrees to accept
the same "AS-IS", "WHERE-IS". All understandings and agreements heretofore made
between the parties hereto are merged into this Sublease, which alone fully and
completely expresses the agreement between Sublandlord and Subtenant, and any
executory agreement hereafter made shall be ineffective to change, modify,
discharge or effect an abandonment of it, in whole or in part, or a surrender of
this Sublease or of the Subleased Premises or any part thereof or of any
interest of Tenant therein unless such executory agreement is in writing and
signed by Sublandlord and Subtenant. Notwithstanding anything to the contrary
contained here, Sublandlord represents, warrants and covenants (now and as of
the Commencement Date) that to the best of Sublandlord's knowledge (A) all
improvements to the Subleased Premises made by the Sublandlord shall remain on
the Sublease Premises and have been constructed, installed, operated and
maintained in accordance with all applicable laws, by-laws, rules, regulations,
orders, permits and licenses and (B) all plumbing, HVAC, electrical and other
building systems within the Sublease Premises are in good working order and
repair.

                  (b)      Occupancy of the Subleased Premises by Subtenant. The
occupancy of the Subleased Premises or any part thereof for business by
Subtenant or anyone claiming by, under or through Subtenant shall be conclusive
evidence that (i) Subtenant accepts possession, and (ii) the Subleased Premises
were in good and satisfactory condition, subject to the representations and
warranties set forth above.

                  (c)      Furniture and Telephones. Throughout the term and at
no additional cost to Subtenant, Subtenant shall have the right to use the
furniture and telephone equipment currently existing in the Subleased Premises
and as more specifically set forth on Exhibit B attached hereto and made a part
hereof (the "Furniture") together with the existing phone and data wiring as set
forth on the attached Exhibit C (the "Wiring"). Subtenant, at its sole cost and
expense, shall be responsible to maintain, repair and replace the Furniture and
Wiring during the Term. Subtenant acknowledges that the Furniture is used, the
Wiring is pre-existing, and that Sublandlord has not made and does not make any
representations or warranties with respect to the Furniture or Wiring. Subtenant
accepts the Furniture and Wiring in their respective "As Is" "Where-Is"
conditions as of the date hereof. The Furniture and Wiring shall remain the
property of Sublandlord throughout the Term, and Subtenant shall surrender the
Furniture and Wiring to Sublandlord at the expiration or earlier termination of
this Sublease in substantially the same condition as existed on the Commencement
Date, reasonable wear and tear excepted. Notwithstanding the foregoing, in the
event that the Sublandlord offers the Furniture for sale upon the expiration or
earlier termination of the Term, Subtenant shall have the right of first refusal
on the Furniture, whereby Subtenant shall have the right within five (5)
business days of receipt of Sublandlord's notice to purchase the Furniture at
the Sublandlord's offered price, in its "As-Is" "Where-Is" condition at the time
of the offer, time being of the essence. In the event that Subtenant timely
accepts Sublandlord's offer and pays to Sublandlord the offered price,
Sublandlord shall quitclaim all its right title and interest in the Furniture to
the Subtenant free and clear of any liens and encumbrances of Sublandlord, but
without any other warranty or representation of any kind whatsoever and
Subtenant shall be responsible to remove the Furniture at the expiration of the
Term. In the event that Subtenant does not timely exercise its right to purchase
the Furniture, Subtenant's right of first refusal on the Furniture shall
terminate and Sublandlord shall have no further obligation to offer the
Furniture to the Subtenant for purchase.

                                       5.

<PAGE>

                  (d)      Telecom Room; Rerouting of Wiring Subtenant shall be
responsible for demising and equipping a telecommunication equipment room (the
"telecom room") within the Subleased Premises for its own use. Subtenant may at
its sole cost and expense re-route phone and data lines from the offices and
stations within the Subleased Premises to Subtenant's own telecom room.
Subtenant shall be responsible for the cost of configuring its telecom. room and
rerouting phone and data lines to it. Sublandlord shall provide reasonably
required guidance to Subtenant's contractors to facilitate their set-up of
Subtenant's data and phone room.

         7.       Rent.

                  (a)      Subtenant agrees to pay Sublandlord base rent per
month (the "Base Rent") as set forth below payable in advance on the first day
of each month during the Term commencing on the Commencement Date:

<TABLE>
<CAPTION>
         Months                                                Monthly Base Rent
<S>                                                            <C>
 November 2002 through October 2003                              $ 8,000.00
 November 2003 through July 2004                                 $12,000.00
</TABLE>

                  (b)      Subtenant shall also pay to Sublandlord all other
sums of money that shall become due from Subtenant under this Sublease other
than Base Rent ("Additional Rent"). Except as otherwise expressly provided
herein, all Additional Rent shall be due within fifteen (15) days of the date of
Sublandlord's invoice. As used in this Sublease, "Rent" shall mean Base Rent and
Additional Rent. Rent for any month's partial tenancy shall be prorated based
upon the actual number of calendar days in such month. All Rent shall be payable
at the office of the Sublandlord at the following address:

                             Lucent Technologies Inc.
                               c/o Bank of America
                                 P.O. Box 277374
                             Atlanta, GA 30384-7374

or at such other address as directed by written notice from Sublandlord to
Subtenant. Sublandlord's acceptance of Rent after it shall become due and
payable shall not excuse a delay upon subsequent occasions or constitute a
waiver of Sublandlord's rights. The Rent shall be payable in advance without
demand, deduction, set-off or abatement of any kind. Subtenant's obligation to
pay Rent accruing during the term of this Sublease shall survive the expiration
or earlier termination of this Sublease. Subtenant shall pay to Sublandlord upon
execution of this Sublease an amount equal to the first monthly Base Rent, which
amount shall be held by Sublandlord without interest and applied to the Base
Rent obligation of Subtenant first coming due hereunder.

                  (c)      If Subtenant shall fail to pay any installment of
Rent before the sixth day after such Rent is due and payable, Subtenant shall
pay a charge (the "Late Charge") which shall be 5% of the amount of such unpaid
installment of Rent. The parties agree that the amount of such Late Charge
represents a reasonable estimate of the cost and expense that will be incurred
by Sublandlord in processing each delinquent payment of Rent by Subtenant and
that such Late Charge shall be paid to Sublandlord as liquidated damages for
each delinquent payment.

                                       6.

<PAGE>

                  (d)      Provided an Event of Default under this Sublease has
not previously occurred and not been cured, Subtenant shall be entitled to a one
time credit of $ 10,000.00 against Base Rent for the months of March and April
2003.

         8.       Subtenant's Share of Operating Costs and Taxes.

                  8.1      Definitions. As used herein:

                  (a)      "Operating Costs" shall mean any and all costs,
         charges, expenses and disbursements of every kind and nature which
         Sublandlord shall pay or become obligated to pay in connection with the
         operation, ownership, maintenance, management and repair of the
         Building or Property, as the case may be, including, without being
         limited to, the following:

                           (1)      All wage, salary and labor costs of all
                  persons to the extent engaged in the operation, maintenance,
                  management and repair of the Property (including, without
                  being limited to, all applicable taxes, insurance and
                  benefits).

                           (2)      Costs of any utilities supplied by
                  Sublandlord (including, without being limited to, heat,
                  electricity, gas, water and sewer), fuel and supplies and
                  materials for the operation and maintenance of all building
                  systems (including, without being limited to, heating,
                  ventilation and air-conditioning ("HVAC")).

                           (3)      Costs of all insurance, including, without
                  being limited to, casualty, workmen's compensation, rental and
                  liability insurance.

                           (4)      Costs of all maintenance and service
                  agreements, including, without being limited to, window and
                  other cleaning, snow removal, line painting, policing,
                  elevator maintenance and janitorial service.

                           (5)      Costs of repairs, replacements (other than
                  capital repairs and replacements), decorations, and general
                  maintenance, including, without being limited to, exterior
                  building maintenance, paving, curbs, drainage, lighting,
                  sidewalks and landscaping.

                           (6)      All costs of making any alterations to the
                  Building for life-safety systems or energy conservation or
                  other capital improvements required by any governmental
                  requirement enacted or amended after the date hereof or which
                  are primarily for the purpose of reducing or stabilizing
                  Operating Costs or providing additional or increased services
                  to the tenants of the Building, amortized over the useful life
                  of such improvements, with a return on capital at the rate of
                  the lesser of (a) ten percent (10%) per annum or Sublandlord's
                  actual cost of capital.

                           (7)      All property management fees, costs and
                  expenses.

                           (8)      All fees or other charges incurred in
                  conjunction with voluntary or involuntary membership in any
                  energy conservation, air quality, environmental, traffic
                  management or similar organizations.

                                       7.

<PAGE>

                  In the event that any capital improvement results in reducing
                  Operating Costs, then with respect to the Fiscal Year (as such
                  term is defined below) in which the improvement is made and
                  each subsequent Fiscal Year during the Term, the amount by
                  which the Operating Expenses have been reduced shall be deemed
                  deducted from the Base Operating Costs. If Sublandlord is not
                  furnishing any particular work or service (the cost of which
                  if performed by Sublandlord would constitute an Operating
                  Cost) to a subtenant who has undertaken to perform such work
                  or service in lieu of the performance thereof by Sublandlord,
                  Operating Costs shall be increased by an amount equal to the
                  additional Operating Costs which would have been incurred
                  during such period by Sublandlord if it had at its own expense
                  furnished such work or services to such subtenant. In
                  determining the amount of Operating Costs for any Fiscal Year,
                  if less than 95% of the net rentable square feet of the
                  Building shall have been occupied by subtenants or tenants
                  (including Sublandlord), Operating Costs shall be determined
                  for such year to be an amount equal to the like expenses which
                  would have been incurred had such occupancy been 95%
                  throughout such Fiscal Year.

                  (b)      "Base Operating Costs' shall be those Operating Costs
         during Fiscal Year 2003 (10/1/02 to 9/30/03).

                  (c)      "Base Taxes" shall be those Taxes for Fiscal Year
         2003 (10/1/02-9/30/03).

                  (d)      "Subtenant's Proportionate Share" shall mean 2% when
         Operating Costs or Taxes are based on the Property and 12.92% when they
         are based solely on the Building.

                  (e)      "Taxes" shall mean the aggregate amount of real
         estate and personal property taxes and any special assessments levied,
         assessed or imposed upon the Property, or any portion thereof, other
         than any water or sewer charge to the extent the same are included in
         Operating Costs for the applicable Fiscal Year. If because of any
         change in the taxation of real estate, any other tax, assessment or
         surcharge of any kind or nature (including, without being limited to,
         any franchise, income, profit, sales, use, occupancy, gross receipts or
         rental tax) is imposed upon, against or with respect to Prime Landlord
         or Sublandlord, or the occupancy, rents or income there from, either in
         lieu of, in substitution for or in addition to any of the foregoing
         Taxes, such other tax, assessment or surcharge (which shall be measured
         as if the Property, or applicable portion thereof, as the case may be,
         were the only asset of Prime Landlord or such owner) shall be deemed
         part of Taxes. Any Tax increases shall be capped at 5% annually. With
         respect to any Fiscal Year, all expenses, including attorney's,
         accounting and experts' fees and expenses, incurred in contesting the
         validity or amount of Taxes, the assessed valuation of the Property, or
         any portion thereof, or in obtaining a refund of Taxes shall be
         considered as part of Taxes for such Fiscal Year.

                  (f)      "Fiscal Year" shall mean each twelve consecutive
         monthly period commencing October I and ending September 30.

                  8.2      Subtenant's Payment of Increases in Base Operating
         Costs and Taxes

                  (a)      For each Fiscal Year after the initial year and
         during the Term-in, Subtenant shall pay to Sublandlord, as Additional
         Rent, at the time and in the manner

                                       8.

<PAGE>

         below, Subtenant's Proportionate Share of the sum of (1) the amount by
         which Operating Costs for such Fiscal Year exceed Base Operating Costs,
         and (2) the amount by which the Taxes for such Fiscal Year exceed Base
         Taxes (collectively "Subtenant's Escalation Charge").

                  (b)      At the beginning of each Fiscal Year subsequent to
         the initial Fiscal Year, Sublandlord shall compute and deliver to
         Subtenant an estimate (an "Estimate") of Subtenant's Escalation Charge
         for the applicable Fiscal Year, and without further notice, after the
         initial year of the Term, Subtenant shall pay to Sublandlord commencing
         with the next payment of monthly Base Rent and continuously thereafter
         with payment of monthly Base Rent until delivery of the next Estimate,
         monthly installments equal to one-twelve of the amount set forth in
         such Estimate, together with, in the case of the first such monthly
         payment, an amount equal to the difference between (i) the amount of
         such monthly installment times the number of months in such year
         preceding the first monthly payment, less (h) the amount of any monthly
         installments in respect of the prior Estimate theretofore paid to
         Sublandlord.

                  (c)      Sublandlord shall deliver to Subtenant within one
         hundred twenty (120) days after the end of each Fiscal Year during the
         Term a written statement (the "Statement") setting out in reasonable
         detail Subtenant's Escalation Charge, based on Sublandlord's actual
         Operating Costs. If the aggregate of the monthly installments actually
         paid by Subtenant to Sublandlord on account of the estimated Tenant's
         Escalation Charge during any Fiscal Year (the "Actual Payments")
         differs from the amount of Subtenant's Escalation Charge payable
         according to the Statement, (the "Obligated Payments `), Subtenant
         shall (1) if the Obligated Payments shall exceed the Actual Payments,
         pay to Sublandlord, within thirty (30) days after the date of delivery
         of the Statement, an amount equal to such excess, or (2) if the Actual
         Payments shall exceed the Obligated Payments, be granted a credit
         against the next installation of Rent in an amount equal to such
         overpayment, or refund such amount to Subtenant if the Term of this
         Sublease has ended.

                  (d)      Subtenant shall be entitled to review the books and
         records relating to Operating Costs and Taxes at the offices of
         Sublandlord or Sublandlord's representatives during business hours and
         upon reasonable notice from Subtenant to Sublandlord. If Sublandlord
         and Subtenant disagree on the accuracy of Subtenant's Escalation Charge
         as set forth in the Statement, Subtenant shall nevertheless make
         payment in accordance with the Statement, but the disagreement shall
         immediately be referred by Sublandlord for prompt decision to a
         mutually acceptable independent public accountant or other professional
         consultant who shall be deemed to be acting as an expert and not as an
         arbitrator, and a determination signed by the selected expert shall be
         final and binding upon both Sublandlord and Subtenant. If Sublandlord
         and Subtenant shall fail to agree on such expert within thirty (30)
         days after Subtenant's notice of disagreement (as hereinafter
         described), such expert shall be selected by the president of the local
         chapter of the National Association of Real Estate Boards. Any
         adjustment required to be made by reason of any such decision shall be
         made within fifteen (15) days thereof and payment shall be made or
         credit allowed in the manner set forth in (c) hereof. If the adjustment
         is greater than 5% and the amount of the adjustment is to be paid to
         the Subtenant, Sublandlord. shall pay the cost of the expert; otherwise
         Subtenant will pay the cost of the expert. Notwithstanding the
         foregoing, Subtenant shall not be entitled to

                                       9.

<PAGE>

         dispute the accuracy of Subtenant's Escalation Charge for any year
         unless a notice to such effect shall be delivered to Sublandlord within
         90 days after the date of delivery of the Statement for such year.

                  8.3      Refunds, Other Items.

                  (a)      In the event a refund of any Operating Costs or Taxes
         is obtained and actually paid to Sublandlord, Sublandlord shall credit
         an appropriate portion thereof (after deducting any un-recouped
         expenses in connection with obtaining such refund) to the next
         installment of Rent owed by the Subtenant to the Sublandlord.

                  (b)      The rendering of a Statement for any Fiscal Year
         shall not preclude Sublandlord from issuing a correction thereto at any
         time, including a correction for items not included in the original
         Statement.

         9.       Use.

                  Subtenant shall have the right to use and occupy the Subleased
Premises during the Term solely for general office use and for no other purpose
without obtaining Sublandlord's prior written consent, but in no event for any
uses prohibited by the terms of the Prime Lease. The uses permitted to Subtenant
by this Section shall not constitute a representation or guaranty by Sublandlord
that Subtenant's business may be conducted in the Subleased Premises.

         10.      Compliance with Laws.

                  (a)      Subject to the representations and warranties set
forth in Section 6 above, Subtenant shall, at Subtenant's sole cost and expense,
promptly comply with and faithfully observe all laws, statutes, ordinances,
orders, rules, regulations or requirements of all county, municipal, state,
federal and other applicable governmental authorities and of any and all their
departments, bureaus and agencies now or hereafter in force pertaining to the
Subleased Premises or to Subtenant's use of the Subleased Premises, or for the
correction, prevention and abatement of nuisances, violations or other
grievances, in, upon or connected with the Subleased Premises, including without
limitation, all laws relating to environmental matters and the Americans with
Disabilities Act, and shall also comply with, and execute all rules, orders and
regulations of the Board of Fire Underwriters or other organization performing
similar functions for the prevention of fires (all the foregoing collectively
referred to as "Legal Requirements"). Notwithstanding the foregoing, Subtenant
shall not be required to make structural changes to the Subleased Premises
unless the obligation to make such changes arises out of Subtenant's use or
occupancy of the Subleased Premises or any alterations or improvements to the
Subleased Premises made by Subtenant. Subtenant shall further observe such rules
and regulations as may be adopted by Sublandlord from time to time for the
safety, care and cleanliness of the Subleased Premises and the preservation of
good order therein.

                  (b)      A violation of any Legal Requirements which is not
cured within thirty (30) days of written notice thereof from Sublandlord to
Subtenant shall constitute a default under this Sublease, provided that if a
longer period is reasonably needed for Subtenant to cure such violation,
Subtenant shall have such longer period provided that within the 30 days
Subtenant has commenced to cure such violation and is diligently pursuing such
cure.

                                      10.

<PAGE>

         11.      Environmental Compliance.

                  (a)      Other than (i) Hazardous Materials placed on the
Subleased Premises by either Prime Landlord or Sublandlord or their respective
predecessors-in-interest or existing on the Premises prior to the Commencement
Date and (ii) customary amounts of Hazardous Materials stored on the Subleased
Premises in the nature of ordinary office and cleaning supplies and materials
(provided, in the case of clause (ii), that the same do not violate or breach
any term or provision of the Prime Lease), Subtenant shall not permit the
Subleased Premises (or any other area of the Building which Subtenant has the
right to use under this Sublease) to contain, be used to store or otherwise be
used to handle Hazardous Material without the prior written consent of
Sublandlord (which may be withheld in Sublandlord's sole and absolute
discretion). Without limitation of the foregoing, any Hazardous Material
permitted on the Subleased Premises (or any other area of the Building which
Subtenant has the right to use under this Sublease) shall be handled, stored,
released, or disposed of in compliance with (x) the Prime Lease, and (y) all
applicable laws, codes, regulations, ordinances orders, consent decrees, permits
or other determinations of any governmental authority having jurisdiction.
"Hazardous Material" means any hazardous substance, toxic substance, hazardous
waste, special waste, petroleum or petroleum-derived substance or waste,
asbestos or any constituent of any such substance or waste hazardous or toxic
substance, material or waste which is or becomes regulated by any local, state
or national governmental authority. Subtenant shall indemnify, defend and hold
Sublandlord harmless from any claims, judgments, damages, penalties, fines,
costs, liabilities or loss, including reasonable attorneys' fees, consultants
fees and expert witness fees, which arise from Subtenant's breach of this
section or its use, storage, release, transport and disposal of Hazardous
Materials on and to the Subleased Premises. Sublandlord shall indemnify, defend
and hold Subtenant harmless from any claims, judgments, damages, penalties,
fines, costs, liabilities or loss, including reasonable attorneys' fees,
consultants fees and expert witness fees, which arise from Sublandlord's or its
agents' or employees' use, storage, release, transport and disposal of Hazardous
Materials on and to the Subleased Premises. The parties' obligations under this
Section shall survive the expiration or earlier termination of this Sublease.

                  (b)      Subtenant shall bear the cost of any necessary
remediation, removal, treatment and disposal of any Hazardous Material placed or
knowingly allowed to be placed on or in the Subleased Premises by Subtenant or
any other Subtenant Party.

         12.      Repairs and Maintenance.

                  (a)      Sublandlord shall make all necessary repairs to keep
the roof, exterior walls, foundation and structural frame of the Building, the
Building systems, fixtures and equipment (such as the Building heating,
ventilating and air-conditioning systems and elevators) and the common areas in
good order and repair, excluding, however, all repairs which Subtenant is
obligated to make or pay for pursuant to this Section 13 and all repairs which
any other subtenant of the Building is required to make pursuant to the terms of
such subtenant's sublease. Subtenant shall give Sublandlord prompt notice (which
in the case of imminent threat to health or safety shall be oral, but otherwise
shall be written notice within not more than ten (10) days) of any defective
condition in any plumbing, heating system or electrical lines located in,
servicing or passing through the Subleased Premises and following such written
notice, Sublandlord shall use commercially reasonable efforts where practicable
to initiate all repairs promptly and to remedy the condition with due diligence,
subject to unavoidable delay, but at the expense of Subtenant (after application
of insurance proceeds, if any) if repairs are necessitated

                                      11.

<PAGE>

by any act attributable to Subtenant other than normal wear and tear, or any of
Subtenant's agents, contractors, employees, representatives, licensees,
invitees, permitted sub-subtenants and permitted successors and/or assigns
(collectively, "Subtenant Parties", and individually, a "Subtenant Party");
provided, however, that no liability of Sublandlord to Subtenant shall accrue
hereunder unless and until Subtenant has given notice to Sublandlord of the
specific repair to be made.

                  (b)      During the Term, Subtenant shall, at its sole
expense, (i) do its own redecorating of the interior of the Subleased Premises
if desired by Subtenant; (ii) make all repairs caused by Subtenant's negligence,
unless covered by any insurance policy maintained by Sublandlord or unless
caused by the gross negligence or willful misconduct of Sublandlord, its agents
or representatives; and (iii) repair and replace any damage to the Furniture or
Wiring and otherwise maintain the Furniture and Wiring in as good a condition as
existed on the Commencement Date hereof, reasonable wear and tear excepted.

         13.      Services and Utilities.

                  (a)      Sublandlord shall furnish and distribute to the
Subleased Premises such building heat, ventilation and air conditioning
("HVAC"), as may be seasonally required for reasonably comfortable occupancy of
the Subleased Premises during Business Hours (as defined hereafter) unless
Sublandlord is unable to do so because Sublandlord is adhering to a required
energy or water conservation program, guidelines, regulations or recommendations
promulgated by any Federal, state, city or other governmental or
quasi-governmental bureau, board, department, agency, office, commission or
other subdivision thereof or the American Society of Heating, Refrigeration and
Air Conditioning Engineers, Inc. or any successor thereto, or other organization
servicing a similar function. Notwithstanding the foregoing provision of this
subsection, Sublandlord shall not be responsible if the normal operation of the
Building HVAC systems serving the Subleased Premises shall fail to provide such
service in accordance with the requirements of this Sublease in any portions of
the Subleased Premises (i) which have an excessive electrical load, or (ii)
because of any rearrangement of partitioning or other improvements to the
Subleased Premises made by or at the direction of Subtenant.

                  (b)      Electricity. Sublandlord shall supply the Subleased
Premises with electrical service for the operation of standard electrical
fixtures, business machines and electrical office equipment. Upon prior written
notice to Subtenant and after a thirty (30) day period to correct, Sublandlord
retains the right to sub-meter or otherwise separately measure Subtenant's
electricity in the event Sublandlord reasonably determines that Subtenant's
electrical usage is excessive, whereby Subtenant shall pay the cost of such
excessive electricity directly to Sublandlord as Additional Rent hereunder.
Sublandlord shall purchase and install all light bulbs, fluorescent and other
lighting tubes, ballasts and any incandescent lamps used in Building-standard
lighting fixtures installed by Sublandlord in the Subleased Premises upon
notification from Subtenant that such installation is required. Subtenant shall
use only such electrical lighting fixtures and lamps as may be approved by
Sublandlord. Subtenant shall replace, as necessary, all bulbs and fluorescent
tubes in non-Building-standard lighting fixtures, if any, installed in the
Subleased Premises. If Subtenant shall fail to make any such replacement within
five (5) days after written notice from Sublandlord, Sublandlord may make such
replacement and charge the cost of labor and materials involved therein to
Subtenant as Additional Rent hereunder.

                                      12.

<PAGE>

                  (c)      Cleaning Services. Sublandlord shall provide cleaning
services five (5) days a week, Holidays excepted, as set forth on the attached
Exhibit D. Subtenant shall not provide any cleaning services without
Sublandlord's consent and then only at Subtenant's sole responsibility and
expense and by cleaning contractors or employees and in a manner at all times
satisfactory to Sublandlord. Subtenant shall pay to Sublandlord the cost of
removal of any of Subtenant's refuse and rubbish to the extent that such refuse
and rubbish removed by Sublandlord exceeds the refuse and rubbish normally
attendant upon the use of the Subleased Premises as offices.

                  (d)      Interruption of Services. Sublandlord reserves the
right, without liability to Subtenant and without constituting any claim of
constructive eviction, to stop or interrupt any heating, lighting, ventilating,
air conditioning, gas, steam, power, electricity, water, or other service and to
stop or interrupt the use of any Building facilities at such times as may be
necessary and for as long as may reasonably be required by reason of accidents,
strikes, or inability to secure a proper supply of fuel, gas, steam, water,
electricity, labor or supplies after commercially reasonable efforts, or by
reason of any other similar or dissimilar cause beyond the reasonable control of
Sublandlord. Sublandlord shall give prior notice of any interruption due to or
the making of repairs, alterations, or improvements, and shall endeavor to give
Subtenant advance notice of any other interruption as is reasonable in the
circumstances. No such interruption of service shall be deemed a constructive
eviction or disturbance of Subtenant's use and possession of the Subleased
Premises or any part thereof, or otherwise render Sublandlord liable to
Subtenant for damages, or otherwise relieve Subtenant from performance of
Subtenant's obligations under this Sublease, except that Subtenant shall be
entitled to an abatement of rent for each day that Subtenant is unable to use
the Subleased Premises in excess of five in any one calendar year as a result of
such services not being available due to causes within Sublandlord's reasonable
control. Subtenant hereby waives and releases all claims against Sublandlord for
damages for interruption or stoppage of Building services that are beyond
Sublandlord's reasonable control. In the event of any such interruption or
stoppage of Building services, Sublandlord shall use commercially reasonable
efforts to have such services promptly resumed. Sublandlord shall be deemed to
have observed and performed the terms and conditions to be performed by
Sublandlord under this Sublease, including those relating to the provision of
utilities and services, if in so doing it acts in accordance with a requirement
of a governmental or quasi-governmental authority serving the public interest in
the fields of energy conservation or security.

                  (e)      Overtime Charges. If Subtenant requires HVAC or
electrical services at times other than during Business Hours (as such term is
defined below), Sublandlord shall furnish same upon advance notice from
Subtenant, given prior to 12 noon on the Business Day on which such service is
required or 3 p.m. on the Business Day preceding the non-Business Day on which
such service is required, and Subtenant shall pay Sublandlord's then established
charges therefore on demand.

                  (f)      Access. Subject to the terms and conditions of this
Sublease and provided Subtenant, its employees, agents and visitors shall at all
times comply with Sublandlord's security policies and procedures, including
required use of security access badges by all of Subtenant's employees for use
on the door card readers tied into Sublandlord's security system and requiring
registration and badging of all visitors at the Building's main lobby, Subtenant
shall have access to the Subleased Premises on a 24-hour a day, 7 days a week,
365 days per

                                      13.

<PAGE>

year. Subtenant shall reimburse Sublandlord's reasonable costs for badging of
Subtenant's employees and guests.

                  (g)      Business Hours and Holidays. For purposes of this
Sublease, "Business Hours" shall be defined as Monday through Friday: 6:00 a.m.
to 6:00 p.m. and 8:00 a.m. to 12:00 p.m. on Saturdays, except Holidays. For
purposes of this Sublease, "Holidays" are defined as: New Years Day, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day, the Day after Thanksgiving,
and Christmas. (Holidays may be added or deleted by mutual agreement of
Sublandlord and Subtenant As used herein "Business Days" or "business days"
shall mean days other than Saturdays, Sundays and Holidays.

                  (h)      Parking. Subtenant shall have the right to use
twenty-five (25) non-exclusive, non-reserved surface parking spaces at the
Building for the use of Subtenant's employees and business visitors, subject to
any applicable rules and regulations. Notwithstanding anything in the Prime
Lease to the contrary, Subtenant shall not be entitled to reserved parking.

                  (i)      Signage. Subtenant shall have the right to have its
company name listed in the building directory located in the lobby of the
Building, if any, at no additional charge to Subtenant. Subtenant shall be
allowed signage on entry doors to Subtenant's suite and Sublandlord shall work
with Subtenant to accommodate reasonable additional signage directing visitors
to Subtenant's suite. All signage to be at Subtenant's sole cost and expense and
shall be subject to conformance with all Legal Requirements and Sublandlord's
prior review and approval, such approval not to be unreasonably withheld.

         14.      Alterations.

                  (a)      Subtenant shall make no changes, alterations,
additions or improvements to the Subleased Premises (collectively,
"Alterations") without Sublandlord's prior written consent thereto and approval
of the proposed plans for any such Alterations, which consent and approval shall
not be unreasonably withheld, provided, however, Sublandlord shall have no
obligation whatsoever to consent to any proposed structural changes or other
alterations that would affect any Building systems. All Alterations shall be
made at Subtenant's sole cost and expense.

                  (b)      Subtenant shall secure permits necessary for any and
all Alterations and, subject to the terms hereof, schedule the use of elevators
and the timing of such Alterations so as to minimize interference with other
tenants (including, without limitation, Sublandlord) and subtenants in the
Building and the use of Building systems.

                  (c)      Notwithstanding anything to the contrary contained
herein, and notwithstanding the fact that Sublandlord may have consented to any
Alterations hereunder (but without limiting Subtenant's obligations with respect
to Alterations as set forth herein), any and all Alterations made by Subtenant
shall be made in accordance with all Legal Requirements (including, without
limitation, the Americans With Disabilities Act and all rules and regulations of
the Building) and shall not violate any prohibition in the Prime Lease. Any cost
or expense incurred by or imposed upon Prime Landlord or Sublandlord which arise
as a result of the performance of any Alterations to the Subleased Premises
(including, without limitation, any cost or expense of Prime Landlord's or
Sublandlord's compliance with the Americans With Disabilities Act) shall be
borne solely by Subtenant and shall be payable to Prime Landlord

                                      14.

<PAGE>

and/or Sublandlord promptly upon demand therefore. Conversely, any cost or
expense incurred by or imposed upon Subtenant which arise as a result of the
performance of any Alterations to the remainder of the Premises outside of the
Subleased Premises (including, without limitation, any cost or expense of
Subtenant's compliance with the Americans With Disabilities Act) shall be borne
solely by Sublandlord and shall be payable to Subtenant promptly upon demand
therefore.

                  (d)      The title of Sublandlord and Prime Landlord is and
always shall be paramount to the title of the Subtenant and nothing in this
Sublease contained shall empower the Subtenant to do any act which can, shall,
or may encumber the title of the Prime Landlord or the Sublandlord. Subtenant
covenants and agrees not to suffer or permit any lien of mechanics or
materialmen to be placed upon or against the Property, the Sublandlord's
leasehold interest or the Subtenant's subleasehold interest in the Subleased
Premises arising out of the acts of Subtenant or any other Subtenant Party, and,
in case of any such lien attaching to Prime Landlord's interest in the Property
or Sublandlord's leasehold interest, as opposed to Subtenant's subleasehold
interest, Subtenant shall pay and remove the same within twenty (20) days,
unless Subtenant is in good faith disputing such lien in which event Subtenant
shall (i) indemnify Sublandlord, Landlord and Landlord's mortgagee from all loss
in connection with such lien, (ii) insure over such lien on a title insurance
policy of Sublandlord, Landlord and Landlord's mortgagee, or bond over such lien
or otherwise provide, in Sublandlord's reasonable judgment, adequate security to
Sublandlord, Prime Landlord and Prime Landlord's mortgagee (it being
acknowledged and understood that any security which is not satisfactory to the
Prime Landlord or any mortgagee of the Prime Landlord shall not be deemed to be
reasonably satisfactory to Sublandlord), and (iii) commence and diligently
pursue an action to obtain a release of such lien; provided, however, in any
event, Subtenant shall pay and remove any such lien if Sublandlord is required
to obtain a release of such lien under or pursuant to the Prime Lease. Subtenant
shall provide prompt written notice to Sublandlord of the existence of any lien
which is caused by, results from or is in any way attributable to Subtenant's
use and/or occupancy of the Subleased Premises. Subtenant hereby acknowledges
and agrees that, in addition to all other rights and remedies to which
Sublandlord is entitled under this Sublease, in the event that Subtenant fails
to comply with its duties and obligations set forth in this Subsection (c) with
respect to any lien, then Sublandlord shall have the right (but not the
obligation), at its sole option, to cause any such lien to be paid, discharged
and/or released, in which event Subtenant shall, promptly after demand from
Sublandlord, reimburse Sublandlord for any and all amounts spent or incurred by
Sublandlord to pay, discharge and/or release such lien, together with any and
all costs and expenses incurred by Sublandlord in connection therewith
(including, without limitation, reasonable attorneys fees and expenses).

                  (e)      All Alterations made by Subtenant shall remain the
property of Subtenant and upon the expiration or earlier termination of this
Sublease, shall be removed by Subtenant, at Subtenant's sole cost and expense,
if, at the time of Sublandlord's approval of any such Alteration, Sublandlord
notifies Subtenant that such Alteration is to be removed. Subtenant, at its sole
cost and expense, shall repair any damage to the Subleased Premises or the
Property caused by the removal of the Alterations and restore the Subleased
Premises to the condition existing as of the Commencement Date hereof,
reasonable wear and tear excepted. If Subtenant fails to remove the Alterations,
and repair damages to the Subleased Premises or the Property in connection
therewith and so restore the Subleased Premises, Sublandlord shall have the
right to remove such Alterations, repair any damages and complete such
restoration at Subtenant's expenses. Subtenant shall reimburse Sublandlord for
all reasonable restoration costs within

                                      15.

<PAGE>

thirty (30) days after Subtenant receives Sublandlord's notice. The provisions
of this subparagraph (e) shall survive the expiration or earlier termination of
this Sublease.

         15.      Assignment and Subletting.

                  (a)      Subtenant shall not, directly or indirectly or by
operation of law, assign, sub-sublease, mortgage, pledge, hypothecate, convey or
otherwise transfer any direct or indirect interest in this Sublease or the
Subleased Premises, or permit the use and occupancy of the Subleased Premises or
any part thereof for any purpose not provided for hereunder or by anyone other
than Subtenant and Subtenant's employees (any of the foregoing being a
"Transfer,") or suffer a Transfer to occur, whether directly, indirectly, by
operation of law or otherwise, without the prior written consent of the
Sublandlord, which consent may be withheld and/or conditioned in Sublandlord's
reasonable discretion. Along with Subtenant's request, Subtenant shall pay
Landlord One Thousand and 00/100 Dollars ($1,000.00) to cover Sublandlord's
expenses in reviewing any such request. Any direct or indirect transfers of the
controlling interest of the capital stock or partnership interests or limited
liability company interests (as the case may be) of Subtenant (whether in a
single transaction or series of transactions) shall not be a Transfer of
Subtenant's interest under this Sublease so long as such transaction or series
of transactions are not a subterfuge by Subtenant to avoid its obligations under
this Lease.

                  (b)      In connection with any proposed Transfer, Subtenant
shall provide Sublandlord in writing: (i) the name and address of the proposed
sub-subtenant or assignee; (ii) the nature of the business which the proposed
sub-subtenant or assignee will operate on the Subleased Premises; (iii) the
terms of the proposed sub-sublease or assignment including the date when such
sub-sublease or assignment is to become effective (the "Proposed Effective
Date") and a copy of the proposed sub-sublease, assignment and other applicable
agreements; (iv) current financial statements (including an income and expense
statement and balance sheet) of the proposed sub-subtenant or assignee, together
with evidence reasonably satisfactory to Sublessor that the assignee or
sublessee (as applicable) has sufficient financial ability (including, without
limitation, sufficient net worth, annual income and cash flow) to comply with
each and all of the duties and obligations of the Sublessee under this Sublease,
together with any other financial information with respect to the proposed
sub-sublease, sub-subtenant or assignee reasonably requested by Sublandlord; and
(v) such other information about the proposed sub-sublease, subtenant or
assignee reasonably requested by Sublandlord. Sublandlord shall have the right
exercisable by notice to Subtenant within twenty (20) days of Sublandlord's
receipt of the foregoing items (i), (ii), (iii) and (iv) to elect to recapture
the space described in the sublease or assignment. If such recapture notice is
given, it shall serve to terminate this Sublease with respect to the proposed
sub-sublease or assignment space, or, if the proposed sub-sublease or assignment
space covers all the Subleased Premises, it shall serve to terminate the entire
term of this Sublease in either case, as of the Proposed Effective Date. If this
Sublease is terminated pursuant to the foregoing with respect to less than the
entire Subleased Premises, the Rent shall be adjusted on the basis of the
proportion of square feet retained by Subtenant to the square feet originally
demised and this Sublease as so amended shall continue thereafter in full force
and effect.

                  (c)      No assignment of this Sublease nor any sub-sublease
of the Subleased Premises nor any other Transfer shall relieve the original
named Subtenant of any of its obligations under this Sublease. The consent by
Sublandlord to any subsubletting, assignment or other Transfer shall not in any
way be construed to relieve Subtenant from the obligation to

                                      16.

<PAGE>

obtain the express written consent of Sublandlord to any further sub-subletting,
assignment or other Transfer. In the case of any Transfer by Subtenant,
Subtenant shall pay to Sublandlord Fifty percent (50%) of any excess or premium
(net of tenant improvements, leasing commissions, legal fees and other costs
reasonably incurred by Subtenant in connection with the assignment or
subletting) over the rent set forth herein.

                  (d)      All of the following conditions shall be applicable
to any proposed assignment, sub-subleasing or other Transfer: (i) no Event of
Default under this Sublease shall exist, (ii) Subtenant shall provide
Sublandlord with thirty (30) days prior written notice of such assignment,
sub-sublease or other Transfer, (iii) such assignment, subsublease or other
Transfer is made subject and subordinate to the Prime Lease and in compliance
with the terms and provisions of this Sublease, (iv) in no event shall Sublessee
sub-sublease the Subleased Premises (or any portion thereof), or assign this
Sublease (or any interest therein), to any person or entity, or for any purpose,
which is not consistent with a first-class office building or poses a security
or other risk that Sublandlord reasonably deems unacceptable, (v) in no event
shall Sublessee sub-sublease the Subleased Premises (or any portion thereof), or
assign this Sublease (or any interest therein), to any then current subtenant of
Sublandlord at the Property or any then current tenant of the Property, (vi) in
the case of an assignment, the assignee to such assignment shall have made and
agreed to observe, perform and be bound by all of the representations,
warranties, terms, covenants and conditions of this Sublease on Subtenant's part
made and to be observed and performed, (vii) in the case of a subsublease, the
sub-subtenant under such sub-sublease shall have made and agreed to observe,
perform and be bound by all of the representations, warranties, terms, covenants
and conditions of this Sublease on Subtenant's part made and to be observed and
performed with respect to the portion of the Subleased Premises sub-sublet to
such sub-subtenant, and (vii) Subtenant shall, notwithstanding any such
assignment, sub-sublease or other Transfer, at all times remain fully
responsible and liable for each and all of Subtenant's duties, obligations and
liabilities under this Sublease, as though Subtenant were and remained the
"Subtenant" hereunder at all times from and after such assignment, sub-sublease
or other Transfer, it being acknowledged and agreed that no such assignment,
sub-sublease or other Transfer shall release Subtenant from any such duties,
obligations or liabilities hereunder.

                  (e)      If a Transfer occurs in violation of the provisions
of this Section 15, such Transfer shall be void and of no force and effect
against Sublandlord. If the Subleased Premises (or any direct or indirect
interest of Subtenant therein) is Transferred, whether or not in violation of
this Section 15, Sublandlord, after an Event of Default under this Sublease, may
collect any item of rent or other sums paid by the sub-subtenant, user or
occupant as a fee for its use and occupancy, and shall apply the net amount
collected to the Sublease Rent and other items of rent reserved in this
Sublease. No Transfer, whether with or without Sublandlord's prior consent, nor
any such collection or application of rent or fee for use and occupancy, shall
be deemed a waiver by Sublandlord of any term, covenant or condition of this
Sublease or the acceptance by Sublandlord of such assignee, subtenant, occupant
or user as subtenant hereunder. The consent by Sublandlord to any one Transfer
shall not relieve Subtenant from its obligation to obtain the express prior
consent of Sublandlord to any further Transfer in accordance with the terms of
this Sublease. Subtenant shall pay to Sublandlord the reasonable attorneys' fees
and disbursements reasonably incurred by Sublandlord in connection with any
proposed Transfer, including, without limitation, the reasonable costs of making
investigations as to the acceptability of the proposed sub-subtenant or
assignee. In no event shall any Transfer of Subtenant's interest in this
Sublease nor any Transfer of all or any portion of the Subleased Premises, nor
any collection of rent by Sublandlord from any person other than Subtenant as
provided in this Section 15, nor any

                                      17.

<PAGE>

application of any such rent as provided in this Section 15, relieve Subtenant
of its obligations under this Sublease on Subtenant's part to be observed and
performed. Any person or entity to which this Sublease is assigned pursuant to
the provisions of Title 11 of the United States Code (the "Bankruptcy Code')
shall be deemed without further act or deed to have assumed all of the
obligations arising under this Sublease on and after the date of such
assignment.

         16.      Damage or Destruction.

                  (a)      If the Subleased Premises shall be totally destroyed
by fire, other casualty, acts of God or the elements (any such occurrences being
a "Casualty ) this Sublease shall cease and terminate. If this Sublease
terminates as a result of total destruction of the Subleased Premises due to a
Casualty, such termination shall be effective as of the date of the Casualty and
the Rent shall abate from that date, and any Rent paid for any period beyond
such date shall be refunded to Subtenant, and Subtenant shall have no claim
against Sublandlord or Prime Landlord for the loss of its subleasehold interest
or any of Subtenant's property.

                  (b)      If the Subleased Premises shall be partially damaged
as a result of a Casualty ("Partial Damage ), Subtenant shall immediately notify
Sublandlord of the same. If Sublandlord determines, in its sole judgment
reasonably exercised, that the Subleased Premises are partially and temporarily
unavailable for the conduct of Subtenant's business but can be restored within
one hundred twenty (120) days, this Sublease shall continue in full force and
effect and Sublandlord shall restore the Subleased Premises as speedily as
practical to the condition existing prior to the Casualty. Sublandlord shall
have no obligation to restore Subtenant's furniture, fixtures or other personal
property, or any Alterations made by Subtenant. During the restoration period,
the Rent shall abate on the basis of the proportion that the portion of the
Subleased Premises rendered untenantable by the Partial Damage and not used by
Subtenant bears to the whole of the Subleased Premises, as determined by
Sublandlord in its sole judgment reasonably exercised.

                  (c)      In the event of Partial Damage, if Sublandlord does
not restore the Premises as required under Section 16(b) within one hundred
twenty (120) days after the date of the Casualty or, if in Sublandlord's sole
judgment reasonably exercised, Sublandlord is unable or unwilling to restore the
Subleased Premises within said one hundred twenty (120) day period, Subtenant
may terminate this Lease without incurring any liability to Sublandlord,
provided (i) Subtenant gives Sublandlord not less than thirty (30) days prior
written notice, and (ii) Sublandlord does not complete the restoration during
such thirty (30) day period.

         17.      Eminent Domain.

                  (a)      If the entire Subleased Premises is taken by eminent
domain (a "Total Taking") this Sublease will automatically terminate on the
earlier of: (i) the date title to the Subleased Premises vests in the condemning
authority; or (ii) the date Subtenant is dispossessed by the condemning
authority. In such event, the Rent shall abate from the date of termination, and
any Rent paid for any period beyond such date shall be returned to Subtenant and
Subtenant shall have no claim against Sublandlord or Prime Landlord for the loss
of its subleasehold interest or any of Subtenant's property, subject to
subsection (e) below.

                  (b)      If a portion of the Subleased Premises is taken by
eminent domain (a "Partial Taking"), this Sublease will automatically terminate
as to such portion on the earlier of: (i) the date title to such portion vests
in the condemning authority; or (ii) the date Subtenant is

                                      18.

<PAGE>

dispossessed of such portion by the condemning authority. In such event, the
proportion of Rent attributable to such portion shall abate from the date of
termination, and any Rent paid with respect to such portion for any period
beyond such date shall be returned to Subtenant and Subtenant shall have no
claim against Sublandlord or Prime Landlord for the loss of a portion of its
subleasehold interest or any of Subtenant's property.

                  (c)      If a substantial portion of the Premises is the
subject of a Taking, and, in the reasonable judgment of Subtenant, such Taking
materially interferes with Subtenant's ability to continue its business
operations in substantially the same manner and space as prior to such Taking,
Subtenant may terminate this Lease. Such termination shall be effective on the
earlier of (i) the date title to such portion vests in the condemning authority;
(ii) the date Subtenant is dispossessed of such portion by the condemning
authority, or (iii) sixty (60) days following notice to Subtenant of the date
when vesting or dispossession is to occur. In such event, the Rent shall abate
from the date of termination, and any Rent paid for any period beyond such date
shall be returned to Subtenant shall have no claim against Sublandlord or Prime
Landlord for the loss of a portion of its subleasehold interest or any of
Subtenant's property.

                  (d)      If there is Partial Taking and this Sublease
continues, Sublandlord shall, at its expense, with due diligence, restore the
Premises as speedily as practical to its condition before the Taking, except for
the portion taken. Sublandlord shall have no obligation to restore Subtenant's
furniture, fixtures or other personal property, or any Alterations made by
Subtenant pursuant to Section 16.

                  (e)      Subtenant shall not be entitled to any portion of the
payment or award for a Taking, nor shall Subtenant make any claim against
Sublandlord for damages. Notwithstanding the foregoing, Subtenant may file a
claim against the condemning authority for (i) any loss of Subtenant's property;
(ii) moving expenses; (iii) damages for cessation or interruption of Subtenant's
business, or (iv) the value of Subtenant's unexpired Term.

         18.      Insurance.

                  (a)      Subtenant shall maintain, at its expense, during the
Term, with an insurance carrier or carriers authorized to do business in the
state where the Premises are located and rated at Least A+ XII as set forth in
the most current issue of "Best Key Rating Guide", (i) comprehensive general
liability insurance for the Premises in a combined coverage for bodily injury
and property damage in an amount not less than One Million Dollars
($1,000,000.00); (ii) worker's compensation insurance covering all persons
employed in connection with the construction of any improvements by Subtenant
and the operation of its business upon the Premises; and (iii) "all risk"
coverage on all of Subtenant's personal property, including but not limited to
standard fire and extended coverage insurance with vandalism and malicious
mischief endorsements on all Alterations made by Subtenant, if any, in or about
the Premises, to the extent of their full replacement value. If, in the
reasonable opinion of Sublandlord, Prime Landlord or any mortgagees or ground
lessors of the Land and/or the Building, the foregoing coverages and/or limits
shall become inadequate or less than that commonly maintained by prudent
Subtenants in similar buildings in the area and making similar uses, Sublandlord
shall have the right to require Subtenant to increase its insurance coverage
and/or limits. Subtenant shall name Sublandlord, Prime Landlord and any
mortgagee of which Sublandlord or Prime Landlord has advised Subtenant, as
additional insureds under such policy.

                                      19.

<PAGE>

                  (b)      The policy or policies evidencing the insurance
required to be provided by Subtenant under this provision shall provide that
they may not be canceled or amended without first giving thirty (30) days prior
written notice to Sublandlord. A certificate of insurance demonstrating the
required policies are in effect shall be delivered to Sublandlord upon the
execution and delivery of this Lease and replacement certificates shall be
delivered not less than ten (10) days prior to the expiration of any then
existing coverage.

                  (c)      Sublandlord shall carry insurance on the Building as
required by the terms of the Prime Lease.

         19.      Subrogation and Waiver.

         The parties release each other and their respective authorized
representatives from any claims for any damage to the Subleased Premises that
are caused by or result from risks insured against under any all risk or fire
insurance policies carried or required to be carried by either of the parties.
Each party will cause their respective insurers to issue appropriate waiver of
subrogation rights endorsements to all property insurance policies carried in
connection with the Subleased Premises.

         20.      Release and Indemnity.

                  (a)      Subject to the last sentence of this Section 20(a),
to the extent not expressly prohibited by law, Subtenant releases Sublandlord
and Prime Landlord and their respective agents, servants, and employees, from,
and waives all claims for damages to person and property sustained by Subtenant
or by any occupant of the Subleased Premises or by any other person, resulting
directly or indirectly from, fire or other casualty, cause, or any existing or
future condition, defect, matter, or thing in or about the Subleased Premises or
the Building, or any part of it, Subtenant's use and/or occupancy of the
Subleased Premises, or from any equipment or appurtenance therein, or from any
accident in or about the Subleased Premises or Building, or from any act,
omission or neglect of Sublandlord, or its agents, servants, invitees and
employees, or of any other person. This Section 20 shall apply especially, but
not exclusively, to damage caused by water, snow, frost, steam, excessive heat
or cold, sewerage, gas, odors, or noise, or the bursting or leaking of pipes or
plumbing fixtures, broken glass, sprinkling or air conditioning devices or
equipment, or flooding of basements, and shall apply without distinction as to
the person whose act, omission or neglect was responsible for the damage and
whether the damage was due to any of the acts specifically enumerated above, or
from any other thing or circumstance, whether of a like nature or of a wholly
different nature. Subject to the last sentence of this Section 20(a), all
personal property belonging to Subtenant or any occupant of the Subleased
Premises that is in the Subleased Premises or the Building shall be there at the
risk of Subtenant only and neither Sublandlord nor Prime Landlord shall be
liable for damage thereto or theft or misappropriation thereof Notwithstanding
the foregoing, this release shall not operate as a release of Sublandlord from
such liability as may be imposed by law for Sublandlord's gross negligent or
willful misconduct or the gross negligence or willful misconduct of
Sublandlord's respective agents, servants or employees). No representation,
guaranty or warranty is made or assurance given that the communications or
security systems, devices or procedures of the Building will be effective to
prevent injury to Subtenant or any other person or damage to, or loss (by theft
or otherwise) of, any of Subtenant's property or of the property of any other
person, and Sublandlord reserves the right, upon notice to Subtenant, to
discontinue or modify at any time such communications or security' systems, or
procedures without liability to Subtenant.

                                      20.

<PAGE>

                  (b)      Subtenant shall indemnify and save harmless
Sublandlord, its affiliates, and their officers, directors, shareholders and
partners, ("Indemnities"), from and against any and all claims, liabilities,
losses, damages, fines, penalties, costs and expenses (including reasonable
attorneys' fees and other costs of litigation) imposed on, incurred by, against
the Indemnities as a result of (i) any breach by Subtenant of this Sublease or
the Prime Lease, (ii) any personal injury, including death, to any person, or
damage or loss of any kind to any property occurring on or about the Subleased
Premises or the Building due to the acts or omissions of Subtenant or
Subtenant's agents, visitors, employees, contractors, or representatives, and
(iii) any breach or noncompliance by Subtenant or subtenant's agents, visitors,
employees, contractors, and representatives of any Legal Requirements affecting
the use or occupancy of the Subleased Premises. Sublandlord shall indemnify and
save harmless Subtenant, its affiliates, and their officers, directors,
shareholders and partners, ("Subtenant Indemnities"), from and against any and
all claims, liabilities, losses, damages, fines, penalties, costs and expenses
(including reasonable attorneys' fees and other costs of litigation) imposed on,
incurred by, against the Subtenant Indemnities as a result of (i) any breach by
Sublandlord of this Sublease or the Prime Lease, (ii) any personal injury,
including death, to any person, or damage or loss of any kind to any property
occurring on or about the Building due to the gross negligence or intentional
misconduct of Sublandlord or Sublandlord's agents, employees, contractors, or
representatives, and (iii) any breach or noncompliance by Sublandlord or
Sublandlord's agents, employees, contractors, and representatives of any Legal
Requirements affecting the use or occupancy of the Property. The provisions of
this Section 20 shall survive the expiration or sooner termination of this
Sublease.

         21.      Subordination.

         This Sublease shall be subject and subordinate to the Prime Lease and
any ground lease, and to any mortgage, or security interest in either the Prime
Lease or encumbering the fee simple interest in the Building or the land upon
which the Building is located or the Property (as such term is defined in the
Prime Lease).

         22.      Rights Reserved to Sublandlord.

                  (a)      Sublandlord has the right to enter the Subleased
Premises at any reasonable time upon at least 24 hours prior notice, or without
notice in case of emergency, to inspect and examine the Subleased Premises, to
perform maintenance, repairs, and replacements to the Subleased Premises as are
permitted under this Sublease and to show the Subleased Premises and/or
Furniture to prospective subtenants, purchasers or assignees.

                  (b)      Sublandlord shall have the following additional
rights exercisable without notice (except as provided below) and without
liability to Subtenant for damage or injury to property, person or business, all
claims for damage being hereby released, and without effecting an eviction or
disturbance of Subtenant's use or possession or giving rise to any claim for
setoffs, or abatement of Rent:

                           (i)      To change the name, number or designation by
         which the Building may be known;

                           (ii)     To make such changes in or to the Building,
         including the building equipment and systems, as Sublandlord may deem
         necessary or desirable, provided that

                                      21.

<PAGE>

         any such change does not deprive Subtenant of a reasonable means of
         access to the Subleased Premises or unreasonably interfere with the use
         of the Subleased Premises;

                           (iii)    To grant to anyone the exclusive right to
         conduct any business or render any services (including, without being
         limited to, the right to designate all suppliers or persons furnishing
         sign painting and lettering, beverages, foods, towels, vending machines
         or toilet supplies used or consumed on the Subleased Premises) in the
         Building, provided such exclusive right shall not operate to exclude
         Subtenant from the use expressly permitted by Section 10 hereof;

                           (iv)     To close the Building at any such reasonable
         times after Business Hours as Sublandlord may determine, subject,
         however, to Subtenant's right to admittance under such reasonable
         regulations as shall be prescribed from time to time by Sublandlord;
         and

                           (v)      To perform any act, obligation or other
         commitment required of or by Subtenant which Subtenant has not
         performed for any reason whatsoever (including, without being limited
         to, obtaining insurance coverage), and to charge Subtenant as
         Additional Rent all reasonable costs and expenses incurred by
         Sublandlord for such performance, together with interest thereon at the
         Default Rate from the dates of Sublandlord's expenditures until paid.

         23.      Rules and Regulations.

         Subtenant and its agents, employees, contractors and invitees shall
faithfully observe and comply with the rules and regulations attached hereto as
Exhibit E and incorporated herein by this reference, and such reasonable changes
thereto, whether by modification, elimination or addition, as Sublandlord may,
at any time and from time to time, make in respect of the Premises and/or the
Property (the "Rules and Regulations") ` "). Such changes shall be effective
upon notice thereof from Sublandlord to Subtenant. In the case of any conflict
or inconsistency between the provisions of this Sublease and any of the Rules
and Regulations, as originally promulgated or as changed, the provisions of this
Sublease shall control. Nothing contained `in this Sublease shall be construed
to impose upon Sublandlord any duty or obligation to enforce the Rules and
Regulations, or the provisions in any other sublease or agreement, as against
any other subtenant, licensee or occupant, provided, however, that Sublandlord
shall not enforce the Rules and Regulations so as unjustly to discriminate
against Subtenant. Sublandlord shall not be liable to Subtenant for the
nonperformance or violation thereof by any other subtenant or anyone else.

         24.      Default, Rights and Remedies.

                  (a)      The occurrence of any one or more of the following
shall constitute an "Event of Default" by Subtenant under this Sublease:

                           (i)      failure by Subtenant to pay Base Rent within
         ten (10) days after such installment is due.

                           (ii)     failure by Subtenant to pay Additional Rent
         when due and the continuance of such failure for ten (10) days after
         receipt of written notice of such failure to pay on the due date.

                                      22.

<PAGE>

                           (iii)    failure by Subtenant to comply with its
         duties and obligations with respect to liens set forth in Section 15
         hereof,

                           (iv)     a Transfer in violation of the terms of this
         Sublease;

                           (v)      failure by Subtenant to observe or perform
         any other covenant, agreement, condition or provision of this Sublease,
         and the continuance of such failure for twenty (20) days after notice
         thereof from Sublandlord to Subtenant; provided however, that if such
         failure cannot reasonably be cured within twenty (20) days and if
         Subtenant commences such cure within such twenty (20) day period, then
         such period shall be extended for so long as Subtenant is prosecuting
         such cure with diligence and continuity; and provided further,
         notwithstanding anything to the contrary in the foregoing proviso, (x)
         in no event shall Subtenant be entitled to extend such cure period
         beyond ninety (90) days after the expiration of the initial twenty (20)
         day period provided above, and (y) in no event shall Subtenant be
         entitled to any extension of the initial twenty (20) day cure period
         provided above if the default is of a nature that it is incapable of
         being cured. Without limiting any other right or remedy to which
         Sublandlord is entitled hereunder, at law or in equity, in the event
         that Sublandlord determines, in its reasonable discretion, that
         Subtenant is failing to prosecute any cure described above in this
         clause (v) with diligence and continuity (whether such failure occurs
         or commences within the initial twenty (20) day cure period provided
         above or otherwise), or in the event that Prime Landlord notifies
         Sublandlord or Subtenant that Prime Landlord does not believe that any
         such cure is being diligently and continuously prosecuted, then (in
         either case) Sublandlord shall have the right (but not the obligation)
         to prosecute such cure, in which event Subtenant shall reimburse
         Sublandlord, immediately upon demand by Sublandlord, for any and all
         costs and expenses incurred or paid by Sublandlord in connection with
         the prosecution of such cure (including, without limitation, reasonable
         attorneys' fees and expenses);

                           (vi)     Subtenant becomes insolvent or bankrupt or
         admits in writing its inability to pay its debts as they mature, or
         makes an assignment for the benefit of creditors, or applies for or
         consents to the appointment of a trustee or receiver for Subtenant or
         for the major part of its property;

                           (vii)    A trustee or receiver is appointed for
         Subtenant or for the major part of its property and is not discharged
         within sixty (60) days after such appointment;

                           (viii)   All or a material portion of Subtenant's
         assets are levied upon under execution or attached by process of law
         and the proceedings are not dismissed or stayed within sixty (60) days;

                           (ix)     Bankruptcy, reorganization, arrangement,
         insolvency or liquidation proceedings, or other proceedings for relief
         under any bankruptcy law, or similar law for the relief of debtors, are
         instituted by or against Subtenant and, if instituted against
         Subtenant, are allowed against it or are consented to by it or are not
         dismissed or stayed within ninety (90) days after such institution; or

                           (x)      The taking of any action by Subtenant, which
         action constitutes a "Default" under the Prime Lease.

                                      23.

<PAGE>

                  (b)      Upon the occurrence of an Event of Default hereunder,
Sublandlord shall be entitled to (i) terminate this Sublease by notice to
Subtenant given on the occurrence or during the continuance of such Event of
Default, in which event the Sublease Term of this Sublease shall end, and all
right, title and interest of Subtenant hereunder shall expire, on the date
stated in such notice, (ii) terminate the right of Subtenant to possession of
the Subleased Premises (and the other areas of the Building which Subtenant has
the right to use under this Sublease) without terminating this Sublease, by
notice to Subtenant given on the occurrence or during the continuance of such
Event of Default, in which event the right of Subtenant to possession of the
Subleased Premises (and the other areas of the Building which Subtenant has the
right to use under this Sublease) or any part thereof shall cease on the date
stated in such notice, (iii) exercise against Subtenant all of the rights and
remedies available to the Prime Landlord under the Prime Lease after the
occurrence of a Default thereunder, and (Iv) exercise against Subtenant all
other rights and remedies which are available to Sublandlord at law or in
equity.

                  (c)      Upon the occurrence of an Event of Default hereunder,
Sublandlord shall (in addition to, and not in lieu of, each and all of its other
rights and remedies hereunder, at law and in equity) be entitled to take any and
all such actions necessary or desirable (as determined by Sublandlord, in its
sole and absolute discretion) to prevent the occurrence of, or cure, any default
under the Prime Lease which results from, arises out of or is in any way
attributable to such Event of Default hereunder, which rights shall include,
without limitation, the right to enter upon, take possession of, and/or use the
Subleased Premises for purposes of preventing or curing any such default under
the Prime Lease.

                  (d)      All rights and remedies of Sublandlord set forth in
this Section 24 shall be distinct, separate and cumulative and shall not operate
to exclude or deprive Sublandlord of, but shall be in addition to, any other
right or remedy allowed it by law or by other provisions of this Sublease.

No receipt of any sums by Sublandlord from Subtenant after any default hereunder
or after the termination or expiration of this Sublease, or after the service of
any notice or after the commencement of any suit or after final judgment for
possession of the Subleased Premises shall waive any such default or reinstate,
continue or extend the term of this Sublease or affect any such notice or suit,
as the case may be. No waiver of any default of Subtenant hereunder shall be
implied from any omission by Sublandlord to take any action on account of such
default, it being acknowledged and agreed by Subtenant and Sublandlord that no
such waiver shall be effective or in any way binding unless the same is in a
writing duly executed by an authorized representative of Sublandlord. No express
waiver by Sublandlord shall affect any default other than the default specified
in such express waiver.

         25.      Expiration and Termination of Sublease and Holding Over.

                  (a)      Expiration and Termination of Sublease. Upon the
expiration or earlier termination of this Sublease, Subtenant shall immediately
vacate the Subleased Premises and surrender possession thereof to Sublandlord,
in substantially the same condition as when Subtenant took possession thereof,
ordinary wear and tear and casualty excepted. In addition to, and without
limitation of the foregoing, (A) Subtenant shall remove such Alterations (and
restore the condition of the Subleased Premises) as required by the terms of
this Sublease or as may be otherwise directed by Sublandlord in connection with
Sublandlord's approval of Alterations, if any, and (B) Subtenant shall remove
from the Subleased Premises all personal property not owned by Sublandlord or
Landlord (such personal property not so removed shall be deemed

                                      24.

<PAGE>

abandoned and title thereto shall automatically pass to Sublandlord without
payment or credit to Subtenant) and (C) all Furniture and Wiring shall be in as
good condition as existing on the Commencement Date, reasonable wear and tear
excepted. Subtenant shall, within thirty (30) days after Sublandlord's written
request, repair any damage to the Subleased Premises or other areas of the
Building caused by the removal of any property by Subtenant.

                  (b)      Holding Over. Subtenant shall not be entitled to
remain in possession of the Subleased Premises after expiration of this
Sublease. In the event Subtenant does not immediately surrender the Subleased
Premises upon the expiration or earlier termination of this Sublease in
accordance with the terms hereunder, Subtenant shall be a tenant at sufferance
and Rent shall be increased to 150% of the Base Rent, Additional Rent and other
sums that would have been payable pursuant to the provisions of this Sublease if
the Term had continued during such holdover period, and Subtenant shall be
responsible for all damages incurred by Sublandlord as a result of the holdover,
including without limitation payments and penalties to the Prime Landlord
pursuant to the Prime Lease and all consequential damages. Such rent shall be
computed on a monthly basis and shall be payable on the first day of such
holdover period and the first day of each calendar month thereafter during such
holdover period until the Subleased Premises shall have been vacated and
surrendered in accordance with the terms and provisions of this Sublease.
Sublandlord's acceptance of such rent shall not in any manner adversely affect
Sublandlord's other rights and remedies, including Sublandlord's right to evict
Subtenant and to recover damages.

         26.      Quiet Enjoyment.

         If and so long as Subtenant shall pay the rent reserved under this
Sublease whenever the same shall become due and shall keep all of the covenants
and agreements required by it to be kept during the term of this Sublease and
shall perform all of its other obligations hereunder, Sublandlord shall not
voluntarily take any action (including, without limitation, granting any express
right to any other subtenant of Sublandlord) that results in the deprivation of
the peaceful and quiet occupation and enjoyment of the Subleased Premises by
Subtenant upon, and subject to, the terms of this Sublease; provide , that
nothing contained in this Section 26 shall limit Sublandlord from exercising any
rights of Sublandlord reserved hereunder or under the Prime Lease.

         27.      Sublandlord's and Subtenant's Power to Execute.

         Sublandlord (subject to Prime Landlord's and Lender's consent, if
required under the terms of the Prime Lease) and Subtenant covenant, warrant and
represent that they have full power and proper authority to execute this
Sublease. If Subtenant is a corporation or other entity, Subtenant hereby
represents and warrants that Subtenant is duly formed and in good standing in
its jurisdiction of organization and is duly qualified and authorized to do
business in the state where the Subleased Premises are located (Subtenant agrees
to supply evidence thereof to Sublandlord upon request); and that each person
executing this Sublease on behalf of Subtenant is an officer or duly authorized
representative of Subtenant, and that he, she or they, as the case may be, are
duly authorized to execute, acknowledge and deliver this Sublease to Sublandlord
(Subtenant agrees to supply a copy of a resolution or secretary's certificate to
that effect to Sublandlord upon request).

                                      25.

<PAGE>

         28.      Estoppel Certificate.

         Subtenant (and/or any permitted assignee, sub-subtenant, or other
occupant of the Subleased Premises claiming by, through, or under Subtenant)
agrees, upon not less than ten (10) days prior written request by Sublandlord,
to deliver to Sublandlord a statement in writing signed by Subtenant certifying
(i) that this Sublease is unmodified and in full force and effect (or if there
have been modifications, identifying the modifications); (ii) the date upon
which Subtenant began paying Base Rent and the dates to which the Base Rent has
been paid; (iii) that, to the best of Subtenant's knowledge, Sublandlord is not
in default under any provision of this Sublease, or, if in default, the nature
thereof; (iv) that there has been no prepayment of Base Rent other than that
provided for in this Sublease; and (v) such further information with respect to
the Sublease or the Subleased Premises as Sublandlord may reasonably request.
Iii the event that Subtenant fails to deliver the foregoing estoppel certificate
within ten (10) days of Sublandlord's request, then Sublandlord without limiting
the Sublandlord's rights on account of such failure, does hereby make,
constitute and irrevocably appoint Sublandlord as its attorney in fact and in
its name, place and stead so to do.

         29.      No Recording.

         Subtenant shall not record this Sublease, or any portion or any
reference hereto. In the event Subtenant records this Sublease, or permits or
causes this Sublease, or any portion hereof or reference hereto to be recorded,
this Sublease shall terminate at Sublandlord's option or Sublandlord may declare
an Event of Default hereunder and pursue any and all of its remedies provided in
this Sublease.

         30.      Default Interest.

         In the event that amounts to be paid hereunder are not paid in
accordance herewith after applicable notice and cure periods, such unpaid
amounts shall bear interest at the rate of 2% above the "Prime Rate" published
from time to time by the Wall Street Journal (the "Default Rate"), until such
amounts are paid.

         31.      Governing Law.

                  This Sublease shall be construed and interpreted in accordance
with the internal laws (as opposed to conflicts of law principles) of the state
where the Subleased Premises are located.

         32.      Notices.

                  Any notice by either party to the other shall be delivered
personally or mailed by registered or certified mail, return receipt requested,
or by reputable overnight delivery service to the following:

If to Subtenant:           Peninsula Pharmaceuticals, Inc.
                           1701 Harbor Day Parkway
                           Alameda, CA 94502
                           Attn: Office of the President

                                      26.

<PAGE>

Copy to:                   Cooley Godward LLP
                           Five Palo Alto Square
                           Palo Alto, CA 94306
                           Attention: Barclay Kamb

If to Sublandlord:         Lucent Technologies Inc.
                           600 Mountain Avenue
                           Murray Hill, NJ 07974
                           Attn: Lease Administration

with a copy to:            Lucent Technologies Inc.
                           600 Mountain Avenue
                           Murray Hill, NJ 07974
                           Attn: Corporate Counsel - Real Estate

Notice shall be deemed to have been given on the date received, if delivered
personally, or by overnight delivery service, or, if mailed, three (3) business
days after the date postmarked. Either party by notice to the other may change
or add persons and places where notices are to be sent or delivered. In no event
shall notice have to be sent on behalf of either party to more than three (3)
persons.

         33.      Limitation of Liability.

                  Subtenant shall look solely to Sublandlord's estate and
interest in the Building for the satisfaction of any right of Subtenant for the
collection of a judgment or other judicial process requiring the payment of
money by Sublandlord and no other property or assets of Sublandlord,
Sublandlord's agents, officers, directors, employees, or affiliates shall be
subject to levy, lien, execution, attachment, or other enforcement procedure for
the satisfaction of Subtenant's rights and remedies under or with respect to
this Sublease, the relationship of Sublandlord and Subtenant hereunder or under
law, or Subtenant's use and occupancy of the Subleased Premises or any other
liability of Sublandlord to Subtenant.

         34.      Subtenant's Property and Other Taxes.

                  (a)      In addition to the Rent and other charges to be paid
by Subtenant hereunder, Subtenant shall reimburse Sublandlord, upon demand, for
any and all taxes payable by Sublandlord whether or not now customary or within
the contemplation of the parties hereto, levied, assessed or imposed: (1) upon
or with respect to the possession, subleasing, operation, management,
maintenance, alteration, repair, use or occupancy by Subtenant of the Subleased
Premises or any portion thereof; (2) upon the measured value of Subtenant's
personal property owned, installed, used or located in the Subleased Premises,
it being the intention of Sublandlord and Subtenant that, to the extent
possible, such personal property taxes shall be billed to and paid directly by
Subtenant; (3) upon the leasehold interest or any right of occupancy of
Subtenant in the Subleased Premises; or (4) upon this transaction. Any
reimbursement referred to above shall be collectible by Sublandlord as
Additional Rent hereunder.

                  (b)      If the tenant improvements in the Subleased Premises,
installed or paid for by Subtenant and whether or not affixed to the real
property so as to become a part thereof, are assessed for real property tax
purposes at a valuation higher than the valuation at which tenant improvements
conforming to the building standard in other space in the Building are assessed,

                                      27.

<PAGE>

then the real property taxes and assessment levied against the Prime Landlord,
Sublandlord, or against the Building or any portion thereof, by reason of such
excess assessed valuation shall be deemed to be taxes levied against personal
property of Subtenant and shall be governed by the provisions of Section 34(a)
above. If the records of the tax assessor having jurisdiction over the Building
are available and sufficiently detailed to serve as a basis for determining
whether such tenant improvements are assessed at a higher valuation than
building standard," such records shall be binding on both Sublandlord and
Subtenant; otherwise, the actual cost of construction shall be the basis for
such determination.

         35.      Non-Waiver.

                  No course of dealing, course of performance, or failure of
Sublandlord to enforce any term, right or condition of this Sublease shall be
construed as a waiver of such term, right or condition. No receipt of money by
Sublandlord from Subtenant after notice of default, or after the termination of
this Sublease or the commencement of any suit or final judgment of possession of
the Subleased Premises, shall reinstate, continue or extend the term of this
Sublease or affect any notice, demand or suit. The rights and remedies hereby
created are cumulative, and the use of one remedy shall not be construed to
exclude or waive the right to the use of another, or exclude any other right or
remedy allowed by law.

         36.      Entire Agreement.

                  This Sublease (which includes each of the Exhibits attached
hereto) contains the entire agreement between the parties and all prior
negotiations and agreements are merged into this Sublease. This Sublease is the
result of negotiations between knowledgeable parties and their respective
attorneys; accordingly, it shall be construed without regard to any presumption
or rule requiring construction against the party causing an instrument or any
portion thereof to be drafted. This Sublease may not be modified or terminated,
nor any of its provisions waived except by a written instrument executed by all
parties.

         37.      Binding Effect.

                  Except as otherwise expressly provided for in this Sublease,
all the terms, covenants, conditions and provisions of this Sublease shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, legal representatives, successors and permitted assigns. Each
provision of this Sublease to be performed by Subtenant shall be construed to be
both a covenant and a condition, and if there shall be more than one Subtenant,
they shall all be bound, jointly and severally, by the terms, covenants and
conditions of this Sublease.

         38.      Consent of Prime Landlord.

                  Notwithstanding anything to the contrary contained in this
Sublease, Subtenant acknowledges and agrees that wherever in this Sublease the
consent of Sublandlord is to be obtained in connection with any action of the
Subtenant, the Sublandlord shall have the right to withhold such consent
(regardless of whether such consent may or may not be unreasonably withheld) in
the event that (i) the Prime Landlord or its mortgagee has the right to consent
to such action (under the Prime Lease or otherwise), and (ii) the Prime Landlord
or its mortgagee (as applicable) refuses to consent to such action within a
reasonable time after Sublandlord's request therefore from the Prime Landlord.

                                      28.

<PAGE>

         39.      Brokers.

                  Cushman & Wakefield ("Broker") represents both Sublandlord and
Subtenant in this Sublease. Bill McGrath ("Sublandlord's Agent) represents
Sublandlord ("Sublandlord's Agent') and Charles Allen and Ryan Hattersley
represent Subtenant ("Subtenant's Agents"). The parties acknowledge and approve
said dual representation by Broker. The parties represent and warrant that they
have had no dealings with real estate brokers or agent who may claim a
commission other than Sublandlord's Agent and Subtenant's Agent. Each of
Subtenant and Sublandlord agrees to indemnify and hold the other harmless from
all damages, liability, and expense (including reasonable attorneys' fees and
disbursements) arising from any breach of the foregoing representations or
covenants made by the indemnifying party, including, without limitation, any
claims or demands of any broker or brokers or finders for any commission alleged
to be due to such broker or brokers or finders. Sublandlord shall be solely
responsible for any commissions due to Broker as a result of this Sublease,
pursuant to a separate agreement.

         40.      Time.

                  Time is of the essence of each and every provision hereof. If
the performance of any obligation required hereunder or the last day of any time
period determined in accordance with this Sublease is to occur on a Saturday,
Sunday or holiday under the laws of the United States or the State in which the
Subleased Premises is located, then such day shall be extended to the next
succeeding Business Day.

         41.      Security Deposit.

                  (a)      Subtenant shall deposit with Sublandlord upon the
Subtenant's execution of this Sublease the amount of Forty-Eight Thousand and
00/100 Dollars ($48,000.00) (the "SECURITY DEPOSIT") in the form of a clean,
irrevocable, nondocumentary, unconditional and transferable, standby letter of
credit (the "LETTER OF CREDIT") as security for the full and faithful
performance and observance by Subtenant of the terms, covenants and conditions
of this Sublease, including the surrender of the Subleased Premises as herein
provided. The Letter of Credit shall be in the form attached hereto as EXHIBIT F
and shall be issued by and drawable upon any commercial bank, trust company,
national banking association or savings and loan association (hereinafter
referred to as the "ISSUING BANK") with offices for banking purposes in a major
money market center, which shall have outstanding unsecured, uninsured and
unguaranteed indebtedness, or shall have issued a letter of credit or other
credit facility that constitutes the primary security for any outstanding
indebtedness (which is otherwise uninsured and unguaranteed), that is then
rated, without regard to qualification of such rating by symbols such as "+" or
"-" or numerical notation, "AA" or better by Moody's Investors Service and "AA"
or better by Standard & Poor's Corporation, and has combined capital, surplus
and undivided profits of not less than $1,000,000,000, which Letter of Credit
shall name Sublandlord as beneficiary, be in the amount of the Security Deposit,
have a term of not less than one year, permit multiple drawings, be fully and
freely transferable by Sublandlord without the payment of any fees or charges,
and otherwise be in form and content satisfactory to Sublandlord. If, upon any
transfer, any fees or charges shall be so imposed, then such fees or charges
shall be payable solely by Sublandlord and the Letter of Credit shall so
specify. The Letter of Credit shall provide that it shall be deemed
automatically renewed, without amendment, for consecutive periods of one year
each thereafter during the Term, unless the Issuing Bank sends notice (the
"NON-RENEWAL NOTICE") to Sublandlord by certified mail, return receipt
requested, not less than thirty (30) days next preceding the then expiration
date of the Letter of Credit that it elects not to have

                                      29.

<PAGE>

such Letter of Credit renewed. Sublandlord shall have the right, exercisable
upon its receipt of the Non-Renewal Notice, to draw the full amount of the
Letter of Credit, by sight draft on the Issuing Bank, and shall hold or apply
the proceeds of the Letter of Credit as a cash security deposit (to be applied
toward the obligations of Subtenant at the times and to the extent any drawing
under the Letter of Credit would otherwise have been applied) until such time as
a replacement Letter of Credit satisfying the criteria set forth above shall be
provided by the Subtenant to the Sublandlord pursuant to the terms of this
provision.

                  (b)      If Subtenant defaults in respect of any of the terms,
covenants or conditions of this Sublease, including the payment of Rent,
Sublandlord may notify the Issuing Bank and thereupon receive all or a portion
of the Security Deposit represented by the Letter of Credit and use, apply, or
retain the whole or any part of such proceeds, as the case may be, to the extent
required for the payment of any Rent or any other sum as to which Subtenant is
in default. If Sublandlord applies or retains any part of the Security Deposit,
Subtenant, upon demand, shall deposit with Sublandlord the amount so applied or
retained so that Sublandlord shall have the full Security Deposit on hand at all
times during the Term or issue a new Letter of Credit complying with all the
terms and provisions in this Section in the full amount of the Security Deposit.
If Subtenant shall fully and faithfully comply with all of the terms, covenants
and conditions of this Sublease, the Letter of Credit shall be returned to
Subtenant within thirty (30) days after the Expiration Date and after delivery
of possession of the Subleased Premises to Sublandlord in the manner required by
this Sublease. Subtenant expressly agrees that Subtenant shall have no right to
apply any portion of the Security Deposit against any of Subtenant's obligations
to pay Rent hereunder.

                  (c)      Upon a transfer of the Sublandlord's interest in the
Sublease, Sublandlord shall transfer the cash security to the transferee and,
with respect to the Letter of Credit, and within five (5) days after notice of
such transfer, Subtenant, at its sole cost, shall arrange for the transfer of
the Letter of Credit to the new sublandlord, as designated by Sublandlord in the
foregoing notice or have the Letter of Credit reissued in the name of the new
sublandlord (and, upon such re-issuance, Sublandlord shall return the original
Letter of Credit) and Sublandlord shall thereupon be released by Subtenant from
all liability for the return of such security. Subtenant shall look solely to
the new sublandlord for the return of such Letter of Credit and the provisions
hereof shall apply to every transfer or assignment made of the security to a new
sublandlord. Subtenant further covenants and agrees that it shall not assign or
encumber or attempt to assign or encumber the Letter of Credit deposited herein
as security and that neither Sublandlord nor its successors or assigns shall be
bound by any such assignment, encumbrance, attempted assignment or attempted
encumbrance.

         42.      Renewal Option.

                  (a)      Provided Subtenant is not in default of this
Sublease, on the date of the Notice to Renew (as hereinafter defined ) or on the
applicable Expiration Date and on each such date shall be in occupancy of the
entire Subleased Premises, Subtenant shall have the right to extend the Term for
one (1) additional term of twelve (12) months (a "RENEWAL TERM") on the same
terms and provisions of this Sublease as herein provided, except that (a) Base
Rent during such Renewal Term shall be at an annual rate equal to the greater of
(i) the annual Fair Market Rent (as hereinafter defined) for the Subleased
Premises for the applicable Renewal Term and (ii) Base Rent payable hereunder
for the year in which the Expiration Date occurs, (b) Subtenant shall have no
option to renew this Sublease beyond the expiration of the Renewal Term, and (c)

                                      30.

<PAGE>

the Subleased Premises shall be delivered in their existing condition (on an
"as-is" basis) at the time such Renewal Term commences. Such right shall be
exercised by Subtenant by giving written notice (the "NOTICE TO RENEW") to
Sublandlord at least six (6) months prior to the Expiration Date of the original
Term. Time shall be of the essence for the exercise of such option. Tenant shall
have no further right to extend or renew this Sublease. The renewal option set
forth in this Section 42 is personal to the original named Subtenant and shall
not inure to the benefit of any third party.

                  (b)      Fair Market Rent. For the purposes of this Section
42, "Fair Market Rent" shall mean the Base Rent, on a so-called "gross" basis,
that would be paid by a willing subtenant, not compelled to sublease, and
accepted by a willing Sublandlord, not compelled to sublease, for the Subleased
Premises as of the pertinent date taking in all relevant factors including
without limitation, the terms of this Sublease, the comparable space and
improvements in a comparable building in the market area. Fair Market Rent shall
be determined by Sublandlord in a notice ("FAIR MARKET RENT NOTICE") delivered
to Subtenant not later than three (3) months prior to the commencement of each
Renewal Term.

                  (c)      Dispute of Fair Market Rent. In the event Subtenant
shall elect to dispute Sublandlord's determination of the Fair Market Rent,
Subtenant shall be required to notify Sublandlord of such dispute in writing
(the "DISPUTE NOTICE") within thirty (30) days after delivery to Subtenant of
the Fair Market Rent Notice. Failure by Subtenant to so notify Sublandlord of
Subtenant's dispute of the amount thereof shall be deemed to constitute
Subtenant's acceptance thereof. If Subtenant shall timely notify Sublandlord of
Subtenant's dispute, then the parties shall have thirty (30) days to negotiate
an agreeable rate. If after thirty (30) days no agreement in place the
determination of Fair Market Rent shall be determined by arbitration as
hereinafter set forth. If such arbitration concerning Fair Market Rent shall not
be concluded prior to the commencement of the applicable Renewal Term, Subtenant
shall nevertheless pay all Fixed Rent and Additional Rent to Sublandlord with
respect thereto from and after the commencement of the applicable Renewal Term,
which shall include Fixed Rent as specified in the Fair Market Rent Notice. If
the applicable Fair Market Rent as determined by arbitration is greater than or
less than that specified in the Fair Market Rent Notice, then such adjustment as
shall be needed to correct the amount previously paid by Subtenant on such
overpaid or underpaid amount, as the case may be, computed from the date of such
overpayment or underpayment, as the case may be, to the date of refund or
payment, as appropriate shall be made in a payment by the appropriate party
within thirty (30) days after the arbitration determination.

                  (d)      Arbitration of Fair Market Rent. In the event that
arbitration of the Fair Market Rent shall be required pursuant to this Section
42, then the following procedures shall apply:

                           (i)      If Sublandlord or Subtenant desires to
         invoke the arbitration procedure set forth in this Section 42, the
         party invoking the arbitration procedure shall give a notice to the
         other party and shall in such notice appoint a person as
         arbitrator/broker on its behalf Within thirty (30) days after such
         notice, the other party by notice to the original party shall appoint a
         second person as arbitrator/broker on its behalf. The arbitrator/broker
         thus appointed shall appoint a third person, and such three arbitrators
         shall as promptly as possible determine such matter; provided, however,
         that:

                                      31.

<PAGE>

                           (A) If the second arbitrator shall not have been
                  appointed within the thirty (30) day period as aforesaid, the
                  first arbitrator shall proceed to determine such matter and
                  shall render his decision and award in writing within thirty
                  (30) days after the expiration of said thirty (30) day period;
                  and

                           (B) If the two arbitrators are appointed by the
                  parties and shall be unable to agree, within ten (10) days
                  after the appointment of the second arbitrator, upon the
                  appointment of a third arbitrator, they shall give written
                  notice to the parties of such failure to agree, and if the
                  parties fail to agree upon the selection of such third
                  arbitrator within ten (10) days after the arbitrators
                  appointed by the parties give notice as aforesaid, then within
                  five (5) days thereafter either of the parties upon notice to
                  the other party may request such appointment by the nearest
                  office of the American Arbitration Association or any
                  organization which is the successor thereof (the "AAA"), or in
                  its absence, refusal, failure or inability to act, may apply
                  to a trial court of the state in which the Building is located
                  having jurisdiction over the Land (the "COURT"), for the
                  appointment of such arbitrator and the other party shall not
                  raise any question as to the Court's full power and
                  jurisdiction to entertain the application and make the
                  appointment.

                           (ii)     The arbitration shall be conducted in
         accordance with the then prevailing rules of the AAA, modified as
         follows:

                           (A) To the extent that any statute of the state in
                  which the Property is located imposes requirements different
                  than those of the AAA in order for the decision of the
                  arbitrator or arbitrators to be enforceable in the courts of
                  such state, such requirements shall be complied with in the
                  arbitration;

                           (B) Each arbitrator shall be disinterested and shall
                  not be affiliated with Sublandlord or Subtenant; and

                           (C) The arbitrators, if more than one, shall render
                  their decision and award in writing, upon the concurrence of
                  at least two of their number, within thirty (30) days after
                  the appointment of the third arbitrator.

                           (iii)    Such decision and award or the decision and
         award of the single arbitrator as provided in this Section 42, shall be
         binding and conclusive on the parties, shall constitute an "award" by
         the arbitrator within the meaning of the AAA rules and applicable law,
         and counterpart copies thereof shall be delivered to each of the
         parties. In rendering such decision and award, the arbitrators shall
         not add to, subtract from or otherwise modify the provisions of this
         Sublease. Judgment may be had on the decision and award of the
         arbitrators so rendered in any court of competent jurisdiction.

                           (iv)     Each party shall pay the fees and expenses
         of one of the two original arbitrators appointed by or for such party
         and the fees and expenses of the third arbitrator and all other
         expenses of the arbitration (other than the fees and disbursements of
         attorneys or witnesses for each party) shall be borne by the parties
         equally.

                                      32.

<PAGE>

         43.      Waiver of Trial By Jury.

                  The parties hereby waive trial by jury in any action,
proceeding or counterclaim brought by either of the parties hereto against the
other in connection with any dispute under this Sublease.

         44.      Counterparts.

                  This Sublease may be executed in any number of counterparts,
any or all of which may contain the signature of only one of the parties, and
all of which shall be construed together as a single instrument.

         45.      Severability.

                  In the event that any provision of this Sublease is deemed to
be invalid or unenforceable or any reason, this Sublease shall be construed as
not containing such provision and the invalidity or unenforceability thereof
shall not render any other provision of this Sublease invalid or unenforceable.

         46.      Notice and Cure Rights of Sublandlord. In the event of any act
or omission by Sublandlord that would give Subtenant the right to damages from
Sublandlord or the right to terminate this Sublease by reason of a constructive
or actual eviction from all or part of the Subleased Premises or otherwise,
Subtenant shall not sue for such damages or exercise any such right to terminate
until it shall have given written notice of such act or omission to Sublandlord
and to the holder(s) of the indebtedness or other obligations secured by any
mortgage or deed of trust affecting the Subleased Premises, and a reasonable
period of time for remedying such act or omission shall have elapsed following
the giving of such notice, during which time Sublandlord and such holder(s), or
either of them, their agents or employees, shall be entitled to enter upon the
Subleased Premises and do therein whatever may be necessary to remedy such act
or omission. Subtenant waives all rights and remedies it may have under
California Civil Code Sections 1941 and 1942 and any other rights or remedies it
may now or hereafter have to make repairs at Sublandlord's expense and/or to
deduct or offset the cost of the same.

         47.      Sublandlord's Reserved Rights. Without limiting in any way
Sublandlord's right to promulgate rules and regulations, Sublandlord shall have
the following rights, exercisable without notice and without liability to
Subtenant for damage or injury to property, persons or business and without
effecting an eviction, constructive or actual, or disturbance of Subtenant's use
or possession or giving rise to any claim for set off or abatement of rent:

                  (a)      To change the Property's and/or the Building's name,
design or street address.

                  (b)      To approve, restrict, install, affix, maintain, and
remove any and all signs on the exterior and interior of the Property and/or the
Building, subject to any signage rights of Subtenant granted hereunder.

                  (c)      To designate and approve, prior to installation, all
types of window shades, blinds, drapes, awnings, window ventilators and other
similar equipment and to control all internal lighting that may be visible from
the exterior of the Property.

                                      33.

<PAGE>

                  (d)      To designate, restrict and control all sources from
which Subtenant may obtain ice, drinking water, towels, toilet supplies, shoe
shining, catering, food and beverages, or like or other services on the
Subleased Premises and in general to reserve to Sublandlord the exclusive right
to designate, limit, restrict and control any business and any service in or to
the Property and its tenants.

                  (e)      To retain at all times, and to use in appropriate
instances, keys to all doors within and to the Subleased Premises.

                  (f)      To decorate and to make repairs, alterations,
additions, changes or improvements, whether structural or otherwise, in and
about the Property, or any part thereof, and for such purposes to enter upon the
Subleased Premises and, during the continuance of any such work, to temporarily
close doors, entryways, public space and corridors in the Property and/or
Building, to interrupt or temporarily suspend Property and/or Building services
and facilities and to change the arrangement and location of entrances or
passageways, doors and doorways, corridors, elevators, stairs, toilets or other
public parts of the Property and/or Building, all without abatement of rent or
affecting any of Subtenant's obligations hereunder, so long as Subtenant's
parking is not reduced the Subleased Premises are accessible.

                  (g)      To have and retain a paramount title to the Subleased
Premises free and clear of any act of Subtenant purporting to burden or encumber
them.

                  (h)      To grant to anyone the exclusive right to conduct any
business or render any service in or to the Property and/or Building.

                  (i)      To approve the weight, size and location of safes and
other heavy equipment and articles in and about the Property and Building, and
to require all such items and furniture and similar items to be moved into and
out of the Property. Building and Subleased Premises only at such times and in
such manner as Sublandlord shall direct in writing. Movements of Subtenant's
property into or out of the Property and/or Building and within the Property are
entirely at the risk and responsibility of Subtenant, and Sublandlord reserves
the right to require permits before allowing any such property to be moved into
or out of the Property.

                  (j)      To prohibit the placing of vending or dispensing
machines of any kind in or about the Subleased Premises without the prior
written permission of Sublandlord.

                  (k)      To have access for Sublandlord and other tenants of
the Property to any mail chutes located on the Subleased Premises according to
the rules of the United States Postal Service.

                  (l)      To take all such reasonable measures as Sublandlord
may deem advisable for the security of the Property and its occupants, including
without limitation, the closing of the Property after normal business hours and
on Saturdays, Sundays and holidays; subject, however, to Subtenant's right to
admittance when the Property is closed after normal business hours under such
reasonable regulations as Sublandlord may prescribe from time to time which may
include, by way of example but not of limitation, that persons entering or
leaving the Property, whether or not during normal business hours, identify
themselves to a security officer by registration or otherwise and that such
persons establish their right to enter or leave the Property.

                                      34.

<PAGE>

             [BALANCE OF PAGE IS BLANK, SIGNATURES ARE ON NEXT PAGE]

                                      35.

<PAGE>

                                   SIGNATURES

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

WITNESS:                                       SUBLANDLORD:

                                               LUCENT TECHNOLOGIES INC.,
                                               a Delaware corporation

                                               By:  /s/ Michael W. Charles
___________________________                       ------------------------
Name                                           Name:  Michael W. Charles
                                               Title: Transaction Manager

WITNESS:                                       SUBTENANT:
                                               PENINSULA PHARMACEUTICALS INC.,
                                               a Delaware corporation

/s/ Dirk Thye                                  By:  /s/ Paul F. Truex
---------------------------                       ------------------------------
                                               Name:  Paul F. Truex
                                               Title: President

                                      36.

<PAGE>

                                    EXHIBIT A

                             THE SUBLEASED PREMISES

                                   [GRAPHIC]

                                      37.

<PAGE>

                                    EXHIBIT B

1701 HARBOR BAY PARKWAY, ALAMEDA, CA.
SUITE 1400 FURNITURE INVENTORY

18 Technion cubes with standard two work surfaces
34 Technion overhead bins
56 - 2 drawer Meridian pedestal files-gray
9 Rosemount Manager work stations - gray
9 Overhead bins to go with gray Rosemount work stations
2 Rosemount Senior Manager work stations- red
2 Overhead bins to go with red Rosemount work stations
11 tear drop tables
1 DFM Director work station (Cherry Wood)
1 DFM 3-shelf bookcase
2 DFM 2-drawer pedestal files
2 cherry wood whiteboards
1 Conference room table
1 Credenza
1 corner table -3 leg
1 round meeting table
1 Gray metal 5-shelf bookcase -Gray Meridian
4 storage files
2-3 drawer lateral files-Gray Meridian
1-5 drawer lateral file-Gray Meridian
7-2 drawer lateral files-Gray Meridian
2-2 drawer pedestal files-Black Meridian
1-2 drawer lateral file-Black Meridian
7 office supply cabinets
18 white boards
33 desk chairs
27 guest chairs
1 mail sorter
2 folding tables
2 lunch tables
3 lunch chairs
Rolling File System made by Tab Products
1 Refrigerator

                                      38.

<PAGE>

                                    EXHIBIT C

                                     WIRING

Subtenant shall be responsible to obtain a LAN switch, data network and voice
network from outside vendors at Subtenant's sole cost and expense, Sublandlord
shall not provide and Wiring does not include, such items. Any additional wiring
not set forth on the attached Exhibit C shall be at the sole responsibility and
expense of Subtenant. In addition, any rerouting of wiring must be rerouted by
Subtenant, at its sole cost and expense, to the telecom room within the
Subleased Premises.

                                      39.

<PAGE>

                                    EXHIBIT D

                             CLEANING SPECIFICATIONS

THE FOLLOWING FUNCTIONS SHALL BE PERFORMED PER VISIT:

GENERAL OFFICES AND COMMON AREAS

1.       Vacuum all carpeted floors, moving light furniture such as chairs,
         waste receptacles, and so forth. Return all furniture to proper place.

2.       Clean all vertical surfaces and fixture including wall switches, doors,
         frames, and walls.

3.       Empty and clean all waste receptacles. Remove all refuse to designated
         areas and replace trash liners.

4.       Vacuum and dust all lobby furniture.

5.       Clean entrance glass doors and lobby/office windows.

6.       Clean main reception area to a showcase condition.

7.       Dust wipe, with a treated cloth, all horizontal surfaces within reach
         including desks, credenzas, chairs, file cabinets, and counters. Papers
         and folders left on desks will not be moved.

8.       Wipe clean signs, glass, pictures frames, etc.

9.       Sweep with dust control mop and spot mop all floors.

10.      Spot clean carpets for minor spills and drips. (Excessive spotting
         excepted).

11.      Clean and sanitize drinking fountains if applicable.

12.      Clean smudges and finger prints on all interior glass partitions.

13.      Report and log any unusual occurrences, problems with lights, plumbing,
         etc.

14.      Turn off all lights, except designated night lights, secure all windows
         and doors upon leaving premises, set alarms.

REST ROOMS

1.       Clean and disinfect all basins, bowls, urinals and showers with
         approved germicidal solution including tile walls near urinals.

2.       Clean and polish all mirrors, counter tops, towel dispensers,
         receptacles and other metal accessories.

3.       Disinfect all chrome fixtures with germicidal solution.

4.       Empty all trash including sanitary pails and clean as needed, changing
         liners daily.

5.       Restock all dispensers as needed.

6.       Mop floors and clean hard to reach places with germicidal cleaner.

7.       Remove spots and marks form partitions, doors, and walls.

                                      40.

<PAGE>

BREAK OR LUNCH ROOM

1.       Clean and disinfect all counters, tables, sinks, cabinets and
         appliances.

2.       Polish chrome fittings.

3.       Sweep, mop and disinfect all floors, vacuum if applicable. Return all
         furniture to proper place.

4.       Empty all trash and clean the trash can(s).

5.       Wipe microwave/wipe refrigerator exterior.

6.       Clean all coffee stations.

7.       Refill all dispensers as needed.

8.       Empty recycle items as needed.

THE FOLLOWING FUNCTIONS SHALL BE PERFORMED WEEKLY:

GENERAL OFFICE AND COMMON AREAS

1.       Clean and disinfect telephones, copy machine and so forth.

2.       Remove finger prints and smudges from entrance walls.

3.       Thoroughly clean entrance doors and glass.

4.       Clean door kick plates and thresholds.

5.       Fully vacuum all carpets, wall to wall.

6.       Dust and clean all doors, sashes, tops of partitions, and other low
         maintenance areas.

7.       Remove dust from baseboards, ledges, and window sills.

8.       Clean and dust behind plants and under desks.

9.       Detail conference tables and executive work areas.

10.      Spot clean interior glass.

11.      Clean fabric furniture with a whisk broom to remove any dust, paper
         bits, hair, lint, etc.

12.      Completely mop all tile floors.

                                      41.

<PAGE>

REST ROOMS

1.       Thoroughly clean all walls, partitions, doors, and mirrors.

2.       Perform high and low dusting.

3.       Pour clean water into floor drains to prevent sewer gases from
         escaping.

BREAK OR LUNCH ROOM

1.       Sweep, mop and disinfect all floors, vacuum if applicable. Return all
         furniture to proper place.

THE FOLLOWING SERVICES SHALL BE PERFORMED MONTHLY

GENERAL OFFICE AND COMMON AREAS.

1.       Dust all high and hard to reach areas and fixtures beyond daily
         dusting.

2.       Brush and vacuum all wall and ceiling vents and grills in offices.

3.       Vacuum all fabric covered and/or upholstered furniture.

4.       Wipe down all non-fabric areas of furniture.

5.       Dust window blinds and wipe clean.

6.       Clean carpet edges, corners, and other hard to reach, low traffic areas
         not included with daily vacuuming.

REST ROOMS

1.       Dust wall and ceiling vents.

2.       Thoroughly wash and sanitize all walls and partitions.

3.       Scrub all tile floors.

BREAK OR LUNCH ROOM

1.       Dust all high and hard to reach areas and fixtures beyond daily
         dusting.

2.       Brush and vacuum all wall and ceiling vents and grills.

3.       Wipe down all non-fabric areas of furniture.

4.       Dust window blinds and wipe clean.

                                      42.

<PAGE>

                                    EXHIBIT E

                              RULES AND REGULATIONS

         This exhibit, entitled "Rules and Regulations", is and shall constitute
EXHIBIT E to that certain Sublease Agreement dated October 30, 2002 (the
"Sublease'), by and between LUCENT TECHNOLOGIES INC., a Delaware corporation
("Sublandlord') and PENINSULA PHARMACEUTICALS, INC., a Delaware corporation
("Subtenant) for the leasing of certain premises located at 1701 Harbor Bay
Parkway, Alameda, California (the "Premises"). The terms, conditions and
provisions of this EXHIBIT E are hereby incorporated into and are made a part of
the Sublease. Whenever the terms "Sublandlord" or "Subtenant" are used in these
rules and regulations, they shall be deemed to include their respective
employees, agents, contractors, and any other persons permitted by them to
occupy or enter the Premises. The following rules and regulations may from time
to time be modified by Sublandlord in the manner set forth in the Sublease.
Capitalized terms used in these Rules and Regulations which are not otherwise
defined herein shall have the meaning ascribed to them in the Sublease.
Reference to other tenants includes the Sublandlord's occupancy of the Building.

         1.       Obstruction: The sidewalks, entries, passages, corridors,
halls, lobbies, stairways, elevators and other common facilities of the Building
shall be controlled by Sublandlord and shall not be obstructed by Subtenant or
used for any purposes other than ingress or egress to and from the Premises.
Subtenant shall not place any item in any of such locations, whether or not any
such item constitutes an obstruction, without the prior written consent of the
Sublandlord, such consent not to be unreasonably withheld or delayed. Unless
Sublandlord has so consented or in case of emergency (as determined in
Sublandlord's sole discretion), Sublandlord shall have the right to remove any
obstruction or any such item without notice to Subtenant and at the expense of
Subtenant. The floors, skylights and windows that reflect or admit light into
any place in said Building shall not be covered or obstructed by Subtenant.
Sublandlord shall have access to all mechanical and electrical equipment at all
times. Any furnishings that impede access for regular or emergency maintenance
or repair of this equipment are not allowed and any costs to move such equipment
shall be charged to and paid by Subtenant. Except as otherwise set forth in the
Sublease, the Building mechanical and electrical equipment shall remain the
exclusive charge of Sublandlord.

         2.       Deliveries: Subtenant shall insure that all deliveries to the
Premises (including, without limitation, deliveries of mail, office supplies,
beverages and soft drinks, catered meals and all other deliveries of bulk items)
shall be made only upon the elevator(s) designated by Sublandlord for deliveries
and only during the hours of 6:00 a.m. through 6:00 p.m., Monday through Friday
and 8:00 a.m. through 12:00 p.m. on Saturday ("Business Hours"). Only hand carts
with rubber tires and side guards shall be used in the Building. If any person
making deliveries to Subtenant damages the elevator or any other part of the
Building or Property, Subtenant shall pay to Sublandlord upon demand the amount
required to repair such damage and restore the area to its previous condition.

         3.       Moving: Furniture and equipment shall be moved in or out of
the Building only upon the elevator(s) designated by Sublandlord for deliveries
and then only during such hours and in such manner as may be prescribed by
Sublandlord. Subtenant shall schedule any such deliveries or moving in advance
with Sublandlord. Sublandlord shall have the right to approve or disapprove the
movers or moving company employed by Subtenant and Subtenant shall cause

                                      43.

<PAGE>

such movers to use only the loading facilities and elevator(s) designated by
Sublandlord. If Subtenant's movers damage the elevator(s) or any other part of
the Building, Subtenant shall pay to Sublandlord upon demand the amount required
to repair such damage and restore the area to its previous condition.

         4.       Heavy Articles: No safe or article the weight of which may, in
the reasonable opinion of Sublandlord, constitute a hazard or may cause damage
to the Building or its equipment, shall be moved into the Premises. Safes and
other heavy equipment, the weight of which will not constitute a hazard or cause
damage to the Building or its equipment shall be moved into, from or about the
Building only during such hours and in such manner as shall be prescribed by
Sublandlord and Sublandlord shall have the right to designate the location of
such articles in the Premises. Subtenant shall not exceed the floor load for the
Premises and shall obtain the floor load from the Sublandlord prior to moving or
placing any heavy items.

         5.       Nuisance: Subtenant shall not do or permit anything to be done
in the Premises, or bring or keep anything therein which would in any way
constitute a nuisance or waste, or obstruct or interfere with the rights of
other subtenants or occupants of the Building, or in any way injure or annoy
them, or conflict with the laws relating to fire, or with any regulations of the
fire department or with any insurance policy upon the Building or any part
thereof, or conflict with any of the rules or ordinances of any governmental
authority having jurisdiction over the Building (including, by way of
illustration and not limitation, using the Premises for sleeping, lodging or
cooking).

         6.       Building Security: Sublandlord may restrict access to and from
the Premises and the Building outside of the Business Hours of the Building at
any time for reasons of building security. Subtenant shall not allow its
visitors to wait or loiter in the corridors or common areas. All visitors must
be escorted by an employee of the Subtenant at all times. Sublandlord may
require identification of persons entering and leaving the Building and, for
this purpose, may issue Building passes to tenants of the Building. Sublandlord
shall not be liable to any person (including, without limitation, Subtenant) for
excluding any person from the Building or for admission of any person to the
Building at any time, or for damage, loss or theft resulting therefrom.
Sublandlord reserves the right to expel or exclude from the Building any person
who, in the judgment of Sublandlord, is intoxicated or under the influence of
liquor or drugs, or who shall in any manner do any act in violation of any of
the rules and regulations of the Building. All doors which are normally locked
in and around the Building shall be left locked by Subtenant when the Premises
are not in use. Corridor doors with a lockset shall not be left open at any
time. Before leaving the Premises unattended, Subtenant shall close and lock all
doors and turn off the lights where applicable.

         7.       Pass Key: Landlord's staff may at all times have available a
pass key to the Premises and shall at all times be allowed admittance to the
Premises. Unless explicitly permitted by the Sublease, Subtenant shall not
employ any person other than Sublandlord's contractors and employees for the
purpose of cleaning and taking care of the Premises. Sublandlord shall not be
responsible for any loss, theft, mysterious disappearance of or damage to, any
property, however occurring.

         8.       Locks and Keys for Premises: No additional lock or locks shall
be placed by Subtenant on any door in the Building and no existing lock shall be
changed unless the written consent of Sublandlord shall first have been
obtained. A reasonable number of keys to the Premises and to the toilet rooms,
if locked by Sublandlord, will be furnished by Sublandlord, and

                                      44.

<PAGE>

Subtenant shall not have any duplicate keys made. Sublandlord may also furnish
to Subtenant, at Subtenant's expense, a reasonable number of card keys or
building passes permitting access and egress to and from the Building and
elevators within the Building. The distribution and use of such card keys and
passes by Subtenant and its employees shall be subject at all times to such
additional rules as Sublandlord may promulgate from time to time. At the
termination of this Sublease, Subtenant shall promptly return to Sublandlord all
keys, card keys and building passes to the Building, offices, toilet rooms, and
parking facilities. Subtenant shall promptly report to Sublandlord the loss or
theft of any key, card key or building pass. Requests for additional keys,
access cards, or building passes shall be honored by the Sublandlord and shall
be charged to the Subtenant.

         9.       Signs: Subtenant shall be entitled to signage rights as
specified in the Sublease.

         10.      Use of Water Fixtures: Water closets and other water fixtures
shall not be used for any purpose other than for which the same are intended and
no obstructing or improper substance shall be thrown, deposited or disposed of
therein. Any damage resulting to the same from misuse on the part of Subtenant
shall be paid for by Subtenant. No person shall waste water by tying back or
wedging the faucets or in any other manner.

         11.      No Animals, Excessive Noise: No birds, fish, or other animals
(other than guide dogs and service dogs) shall be allowed in the offices, halls,
corridors and elevators in the Building. No person shall disturb the subtenants
of this or adjoining buildings or space by the use of any radio, musical
instrument or singing, or by the making of loud or improper noises.

         12.      Bicycles: Bicycles or other vehicles shall not be permitted
anywhere inside or on the sidewalks outside of the Building, except in those
areas, if any, designated by Sublandlord as bicycle parking.

         13.      Trash: Subtenant shall not allow anything to be placed on the
outside of the Building, nor shall anything be thrown by Subtenant out of the
windows or doors, or down the corridors, elevator shafts, or ventilating ducts
or shafts of the Building. All trash shall be placed in receptacles provided by
Subtenant on the Premises or in any receptacles provided by Sublandlord for the
Building. Subtenant will separate recyclable materials from other trash in
accordance with Sublandlord's instructions. Subtenant shall adhere to the
Building recycling program. No materials or items shall be placed in the
recycling centers unless authorized and instructed by the Sublandlord.

         14.      Windows and Entrance Doors: Window shades, blinds or curtains
of a uniform Building standard color and pattern only shall be used for the
exterior glass of the Building to give uniform color exposure through exterior
windows. No awnings, blinds, shades or screens shall be attached to or hung in,
or used in connection with any window or door of the Premises without the prior
written consent of Sublandlord, including approval by Sublandlord of the
quality, type, design, color and mariner of attachment. Subtenant entrance doors
shall be kept closed at all times in accordance with the fire code.

         15.      Hazardous Operations and Items: Except as otherwise set forth
in the EMS Agreement and subject to the terms and provisions thereof or as
otherwise necessary to comply with Legal Requirements): (a) Subtenant shall not
operate any steam or gas engine or boiler, or carry on any mechanical business
in the Premises without Sublandlord's prior written consent, which consent may
be withheld in Sublandlord's absolute discretion; (b) the use of oil, gas or

                                      45.

<PAGE>

inflammable liquids for heating, lighting or any other purpose is expressly
prohibited; (e) no flammable, combustible or toxic fluid or substance shall be
brought into the Building; and (d) Subtenant shall not cause or permit any gas,
liquids or odors to be produced upon or emanate from the Premises. Additionally,
Subtenant shall not install any new steam or gas engine or boiler in the
Premises without Sublandlord's prior written consent and no explosives,
firearms, or other articles deemed extra hazardous shall be brought into the
Building.

         16.      Hours for Repairs Maintenance and Alterations: Any repairs,
maintenance and alterations required or permitted to be done by Subtenant under
the Sublease shall be done only during the Business Hours of the Building unless
Sublandlord shall have first consented in writing to such work being done
outside of such times. If Subtenant desires to have such work done by
Sublandlord's employees on Saturdays, Sundays, Holidays or weekdays outside of
Business Hours, Subtenant shall pay the extra cost of such labor. If Subtenant
requires lighting or HVAC service on Saturdays, Sundays, Holidays or weekdays
outside of Business Hours, Subtenant shall arrange for such services at least 24
hours in advance and shall pay a charge of $50.00 per hour.

         17.      No Defacing of Premises: Except as permitted by Sublandlord,
Subtenant shall not mark upon, cut, drill into, drive nails or screws into, or
in any way deface the doors, walls, ceilings, or floors of the Premises or of
the Building, nor shall any connection be made to the electric wires or electric
fixtures without the consent in writing on each occasion of Sublandlord or its
agents, and any defacement, damage or injury caused by Subtenant shall be paid
for by Subtenant.

         18.      Limit on Equipment: Subtenant shall not, without Sublandlord's
prior written consent, install or operate any new (i.e., after the Commencement
Date) computer, duplicating or other large business machines or equipment, using
more than 110 volts, 15 continuous load amps upon the Premises. If Subtenant
requires any interior wiring such as for a business machine, intercom, printing
equipment or copying equipment, such wiring shall be done only by Sublandlord's
electrician for the Building and at Subtenant's expense. No electrical wiring
shall be performed by any person unless previously approved in writing by
Sublandlord or its representatives. Any degradation to the level of electric
power quality, (i.e., harmonics, noise, spikes), in the Building, caused by
Subtenant's equipment, or any Subtenant equipment affected by the level of power
quality in the Building shall be remediated by Subtenant. Any use of power
strips shall comply with all code regulations with respect to length and type of
service. If telegraphic or telephonic service is desired, the wiring for same
shall be done as directed by the electrician of the Building or by some other
employee of Sublandlord who may be instructed by the manager of the Building to
supervise same, and no boring or cutting for wiring shall be done unless
approved by Sublandlord or its representatives, as stated.

         19.      Solicitation, Food and Beverages: Sublandlord reserves the
right to restrict, control or prohibit canvassing, soliciting and peddling
within the Building. Subtenant shall not grant any concessions, licenses or
permission for the sale or taking of orders for food, alcoholic beverages,
services or merchandise in the Premises, nor install or permit the installation
or use of any machine or equipment for dispensing goods or foods or beverages in
the Building, nor permit the preparation, serving, distribution or delivery of
food or beverages in the Premises without the approval of Sublandlord and in
compliance with arrangements prescribed by Sublandlord, except in connection
with a convenience lunch room or beverage and food for catered functions for
employees, clients and guests of Subtenant (on a noncommercial basis).

                                      46.

<PAGE>

Only persons approved in writing by Sublandlord shall be permitted to serve,
distribute, or deliver food and 9 beverages within the Building, or to use the
elevators or public areas of the Building for that purpose.

         20.      Balconies and Roof. Sublandlord shall have access to all
balconies and the roof during all hours even when such access requires
Sublandlord to pass through the Premises or window openings.

         21.      Smoke Free Building: If the Building is a smoke free building,
the Subtenant shall not permit any of its employees, agents contractors,
subcontractors, invitees, guests, or visitors to smoke in the Premises or the
Building.

         22.      Emergency Plans: Subtenant shall support and assist the
Sublandlord in the development and maintenance of emergency action plans,
including assigning floor wardens and participating in fire drills.

         23.      Loading Docks: Subtenant shall have the right to use the
loading dock and related facilities for deliveries and moving upon prior
coordination with, and approval of, Sublandlord which approval shall not be
unreasonably withheld or delayed.

                                      47.

<PAGE>

                                    EXHIBIT F

                                LETTER OF CREDIT

                            [ISSUING BANK LETTERHEAD]

[Reference No. _____]                                  [Date]
Beneficiary:                                           Applicant:
Lucent Technologies Inc.                               [Name and Address of
600 Mountain Avenue                                            Subtenant
Murray Hill, NJ 07974
Attention: Lease Administration

Gentlemen/Ladies:

We hereby establish our irrevocable standby letter of credit
No.________________________ in your favor, effective immediately, our reference
no. [_____________________], in the aggregate amount of U.S.D.
[_______________].

We hereby authorize you to draw on [issuing bank] at [New York address of
issuing bank] by your draft(s) at sight, accompanied by your written statement,
purportedly signed by one of your authorized representatives, reading as
follows:

                  "The amount of our drawing, US$_____________________ , under
                  [issuing bank] letter of credit no. [______________________]
                  represents funds due and payable under a certain sublease
                  dated as of [________________________], executed by and
                  between LUCENT TECHNOLOGIES INC., as Sublandlord, and
                  [___________], as Subtenant."

This letter of credit initially expires on [__________]. However, it is a
condition of this letter of credit that it shall be deemed automatically
extended without amendment for additional periods of one year from the present
or each future expiration date hereof, but in any event not beyond its final
expiration date of [__________], unless at least thirty (30) days prior to any
such expiration date we notify you in writing at the above address by certified
mail, overnight courier or hand delivery of our election not to so renew this
letter of credit for any such additional period. After receipt of such notice
but on or before the then current expiration date you may draw up to the then
full aggregate amount available hereunder by means of your sight draft drawn on
us accompanied by your written statement, purportedly signed by one of your
authorized representatives, reading as follows:

                  "We are in receipt of written notice from [issuing bank] of
                  its election not to renew letter of credit no. [__________]
                  for an additional term of one year and as of the date of this
                  drawing we have not received an acceptable replacement letter
                  of credit or any other form of acceptable security from the
                  applicant."

Partial drawings are permitted under this letter of credit, and each partial
drawing shall reduce the total amount available hereunder by the amount of each
partial drawing.

                                      48.

<PAGE>

The Sublease mentioned above is for identification purposes only and is not
intended that said Sublease be incorporated herein or form part of this letter
of credit.

This letter of credit may be transferred in its entirety only to any transferee
that you state in writing to us is the successor to the interest of the
Sublandlord under the Sublease. Said transfer is to be effected at [New York
address of issuing bank] and is contingent upon:

A.       the satisfactory completion of our transfer form attached hereto,

B.       the return of the original of this letter of credit for endorsement
thereon by us to the transferee, and

C.       payment of the applicable transfer fee of $[__________] (if there is a
transfer fee, must specify that it is to be paid solely by Subtenant).

In the event that this letter of credit is transferred, the sight draft and the
signed statement required herein must be executed by on or behalf of the
transferee as beneficiary.

We hereby agree with you that your drafts drawn under and in compliance with the
terms of this letter of credit will be duly honored if presented at our office
located at [New York address of issuing bank] on or before [__________] or any
automatically extended date through [__________] as provided for herein.

Except so far as otherwise expressly stated herein, this letter of credit is
subject to the uniform customs and practice for documentary credits (1993
revision), International Chamber of Commerce, Publication No. 500. As to matters
not governed by the Uniform Customs and Practice for Documentary Credits, the
laws of the state of New Jersey shall govern.

Yours very truly,

Authorized Signature

                                      49.<PAGE>

                                                                    EXHIBIT 10.7

                      FIRST AMENDMENT TO SUBLEASE AGREEMENT
                                     between
                       SRM/PCCP HARBOR BAY ASSOCIATES, LLC
                                       and
                         PENINSULA PHARMACEUTICALS INC.

         This First Amendment to Sublease ("First Amendment"), dated as of
November 1, 2003 (the "Execution Date"), is made by and between SRM/PCCP HARBOR
BAY ASSOCIATES, LLC, a Delaware limited liability company (Master Landlord and
Sublessor, hereinafter referred to as "Landlord") and PENINSULA PHARMACEUTICALS
INC., a Delaware corporation (previous Subtenant and now direct Tenant, and for
clarity herein referred to as "Peninsula" and in the Sublease as "Subtenant" or
"Tenant").

                                    RECITALS

A.       Sumitomo Bank Leasing and Finance, Inc., ("Sumitomo") and Lucent
Technologies Inc. predecessor-in-interest to Landlord ("Lucent") previously
entered into that certain Master Lease of Land and Improvements dated as of May
4, 2000 (the "Master Lease") for the entire Lucent Technology Campus (now known
as The Waterfront at Harbor Bay Business Park), including the building located
at 1701 Harbor Bay Parkway, Alameda, California (the "1701 Building").

B.       Lucent and Peninsula previously entered into that certain Sublease
Agreement dated as of October 30, 2002, (the "Sublease") for approximately 7,500
rentable square feet of leased premises in the 1701 Building (the "Subleased
Premises").

C.       Sumitomo previously assigned its rights and interest under the Master
Lease to Lucent and in connection with the previous sale of the Lucent
Technology Campus, Lucent assigned its rights and interest in the Master Lease
and Sublease to Landlord.

D.       By means of an Estoppel Certificate dated as of May 20, 2003, Peninsula
agreed and acknowledged (i) the assignment of Lucent's interest in the Master
Lease to Landlord with respect to the Subleased Premises and (ii) the assignment
of the Sublease, effecting Peninsula to become the direct Tenant to Landlord. In
turn, Landlord has recognized the Sublease with Peninsula.

E.       Peninsula now desires, among other things, to increase the amount of
square footage leased from the Landlord on the Lucent Technology Campus, move to
an adjacent building in the Lucent Technology Campus located at 1751 Harbor Bay
Parkway (the "1751 Building"), and extend the term of the Sublease and
underlying applicable Master Lease, and Landlord has agreed to such
modification, upon all of the terms and conditions contained in this Amendment.

G.       Unless otherwise specified, capitalized terms are used herein as such
terms are defined in the Master Lease and Sublease.

<PAGE>

NOW, THEREFORE, in consideration of the mutual terms and conditions contained in
this First Amendment, and for other valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties agree as follows:

                                    AGREEMENT

1.       Amendment of Property. The definition of "Property" shall be deleted
         and replaced with the following new definition:

         "Property" means certain land and property referred to as The
         Waterfront at Harbor Bay Business Park, located at Harbor Bay Parkway,
         Alameda, California, consisting of 6 buildings, including the 1701
         Building and the 1751 Building, and containing a total of 379,640
         rentable square feet.

2.       Amendment of Building. Commencing upon November 1, 2003, the definition
         of "Building" shall be amended to include the 1751 Building. Commencing
         on January 1, 2004, the definition of "Building" shall be further
         amended to delete from such definition the 1701 Building.

3.       Amendment of Subleased Premises. The Subleased Premises as set forth in
         Section 1(a) of the Sublease are hereby modified as follows:

                  Commencing upon November 1, 2003, the definition of "Subleased
                  Premises" shall be amended to include 12,358 rentable square
                  feet ("rsf"), measured in accordance with the current BOMA
                  standard, on the second floor of 1751 Harbor Bay Parkway (the
                  "1751 Building") as more specifically shown on the attached
                  EXHIBIT A-1. Commencing on January 1, 2004, the definition of
                  "Subleased Premises" shall be amended to delete all rentable
                  square footage in the 1701 Building. The Landlord acknowledges
                  and agrees that, during the period commencing on November 1,
                  2003 and expiring on December 31, 2003, Peninsula shall only
                  be required to pay Base Rent for that portion of the Subleased
                  Premises located in the 1701 Building.

4.       Deletion of Section 1(b). Section 1(b) of the Sublease shall be deleted
         in its entirety.

5.       Amendment of Section 2. Section 2 of the Sublease shall be deleted in
         its entirety and replaced with the following new Section 2:

         "2. Termination of Prime Lease. The parties understand and acknowledge
         that the Prime Lease has been terminated, Landlord is now the fee owner
         of the Property, and the Sublease is now a direct lease between
         Peninsula and Landlord. Notwithstanding the termination of the Prime
         Lease, those provisions of the Prime Lease applicable to the Subleased
         Premises remain incorporated into the Sublease. The terms of the
         leasehold arrangement between Landlord and Tenant are set out

<PAGE>

         in the Prime Lease and this First Amendment to Sublease Agreement, and
         are referred to collectively as the "Lease."

6.       Deletion of Section 3. Section 3 of the Sublease shall be deleted in
         its entirety.

7.       Amendment of Section 4. Section 4 of the Sublease shall be deleted in
         its entirety and replaced with the following new Section 4:

         "4. Obligations under Prime Lease. Sublandlord shall be deemed the
         Prime Landlord under the Prime Lease, and shall be required to perform
         those obligations of the Prime Landlord under the Prime Lease, and
         shall be liable to Peninsula for a breach of all covenants,
         representations, or other undertakings under the Prime Lease that are
         applicable to the Subleased Premises."

8.       Amendment of Term. The definition of "Expiration Date" in Section 5(a)
         of the Sublease shall be changed from 11:59 a.m. on July 31, 2004, to
         11:59 p.m. on December 31, 2008.

9.       Amendment of Exhibit B. As of January 1, 2004, Exhibit B to the
         Sublease shall be replaced in its entirety with the new Exhibit B-1
         "Furniture Inventory" attached to this First Amendment. Tenant has had
         the opportunity to inspect the existing phone and data wiring in the
         1751 Building, and accepts such pre-existing phone and data wiring "As
         Is" "Where Is". During the Term, Tenant shall have access to the
         communications closet on the first floor of the 1751 Building through
         which telecommunications lines enter the 1751 Building and are directed
         to the second floor of the 1751 Building (the "Communications Closet").
         Tenant shall have the right to route phone and data lines from the
         Communications Closet to the Subleased Premises. Landlord covenants
         that at all times during the Term, the Communications Closet shall be a
         Common Area of the 1751 Building that is accessible to all tenants of
         the 1751 Building, including Tenant.

         Part of the Subleased Premises in the 1751 Building includes a server
         room that does not currently have any entry into the Subleased
         Premises, but instead has only an entry from the Common Area of the
         1751 Building (the "Server Room"). Tenant shall have the option, at its
         expense but subject to Landlords approval of final plans,
         specifications and permits, which approval shall not be unreasonably
         withheld, to create a doorway entry that will open directly from the
         Subleased Premises into the Server Room. In addition, Tenant shall have
         the option, at its expense, to deactivate (per instruction from
         Netversant who is Landlord's security consultant) all keycard access to
         the entry of the Server Room from the Common Area of the 1751 Building
         and install a deadbolt or other locks on such entry in order to prevent
         any access to the Server Room from the Common Area of the 1751
         Building. At Landlord's option at the end of the Term, Tenant shall
         remove the entry to the Server Room from the Subleased Premises and
         restore said area to the condition and finish that exists as of the
         Execution Date.

<PAGE>

10.      Amendment of Base Rent. The monthly Base Rent as last set forth in
         Section 7(a) of the Sublease is hereby amended as of January 1, 2004 to
         read as follows:

                  (a)      For the period commencing January 1, 2004 through
         December 31, 2004 (such period, "Year 1"), the total Rent payable by
         Tenant each month shall be equal to $19,772.80, which amount is equal
         to $1.60 per rsf multiplied by 12,358 rsf. Tenant shall not owe any
         other rent amounts to Landlord for Year 1 including, without
         limitation, Additional Rent under Section 7(c); provided, however,
         Tenant shall owe any additional charges for Tenant's non-Business Hours
         utility usage. For clarity, Landlord shall bear all Operating Expenses
         and Taxes during Year 1 and Tenant shall bear all Base Rent and charges
         for Tenant's non-Business Hours utility charges, as applicable, during
         Year 1. Landlord shall provide an invoice to Tenant for Tenant's
         non-Business Hours charges, if any, and Tenant shall pay such invoice
         within thirty (30) days of its receipt thereof. Tenant shall have the
         right to audit Landlord's records to determine the accuracy of the
         invoiced amounts in accordance with the audit procedures set forth in
         Section 8.3(e).

                           Thereafter during the Term, the Base Rent payable by
         Tenant shall be as follows:

<TABLE>
<CAPTION>
          Months                             Monthly Base Rent
          ------                             -----------------
<S>                                         <C>
1/05 through 12/05 ("Year 2")               $14,211.70 per month
1/06 through 12/06 ("Year 3")               $14,829.60 per month
1/07 through 12/07 ("Year 4")               $15,447.50 per month
1/08 through 12/08 ("Year 5")               $16,065.40 per month
</TABLE>

11.      Amendment of Operating Costs. Commencing on January 1, 2005, the terms
         of the Sublease shall be amended from an industrial gross/full service
         to a triple net basis. Section 8 of the Sublease shall be deleted as of
         January 1, 2004. As of January 1, 2005, the following new Section 8
         shall automatically be added with the following language to read as
         follows:

         "8. Operating Expenses and Taxes.

         8.1      Definitions.

                  (a)      For purposes of this Sublease, the following
         definitions shall apply (Tenant means Peninsula).

                           (i) "ADJUSTMENT DATE" shall mean January 1, 2005 and
         each January 1 thereafter falling within the Term.

                           (ii) "ADJUSTMENT YEAR" shall mean each calendar year
         during which an Adjustment Date falls.

                           (iii) "LANDLORD'S STATEMENT" shall mean a written
         statement furnished by Landlord to Tenant containing a computation or
         information relating

<PAGE>

         to any Additional Rent asserted by Landlord to be due pursuant to the
         provisions of this Lease, and containing back up data reasonably
         sufficient for Peninsula to verify the computation of Additional Rent.

                           (iv) "TENANT'S PROPORTIONATE SHARE" shall be (x)
         3.26% with relation to the Campus based on 12,358 rentable square feet
         in the Premises compared to the total of 379,640 rentable square feet
         in the Property, and (y) 16.91% with relation to the Building based on
         12,358 rentable square feet in the Premises compared to 73,081 rentable
         square feet in the Building. All expenditures incurred on a Property
         basis shall be correspondingly allocated on such Property percentage
         basis to Tenant, and all expenditures incurred on a Building basis
         shall be correspondingly allocated on such Building percentage basis to
         Tenant.

                           (v) "OPERATING EXPENSES" shall mean:

                  All reasonable and necessary costs and expenses paid by or
         incurred on behalf of Landlord in respect of the operation, cleaning,
         repair, safety, management, security and maintenance of the Building or
         Property, as the case may be, including the Common Areas of the
         Building and the common exterior areas of the Property (but on the
         basis that the Building and Property, as applicable, are fully
         occupied), and in respect of the services provided to tenants, which
         are reasonable, directly allocable and directly attributable to the
         operation of the Building or Property, as the case may be, including:

                           (1)      salaries, wages and bonuses paid to, and the
         cost of any hospitalization, medical, surgical, union and general
         welfare benefits (including group life insurance), any pension,
         retirement or life insurance plan and other benefits or similar
         expenses relating to, employees of Landlord or its property manager to
         the extent engaged full-time in the operation, cleaning, repair,
         safety, management, security or maintenance of the Property as a whole
         or the Building, as the case may be;

                           (2)      social security, unemployment and other
         payroll taxes, the cost of providing disability and worker's
         compensation coverage imposed by any law or regulation, union contract
         or otherwise in respect of the employees describe in (1) above;

                           (3)      the cost of electricity, gas, steam, water,
         air conditioning and other fuel and utilities solely allocable to the
         exterior common areas of the Property and to the common areas of the
         Building that are not the obligation of any particular tenant;

                           (4)      the reasonable cost of casualty, rent,
         liability, fidelity, plate glass and any other similar insurance, but
         only to the extent a prudent landlord of a comparable building would
         carry the type and amounts of such insurance;

<PAGE>

                           (5)      the reasonable cost of repairs, maintenance
         and painting of the exterior common areas of the Property and the
         Building;

                           (6)      the reasonable cost or rental of all
         building and cleaning supplies, tools, materials and equipment for the
         cleaning and maintenance of the exterior common areas of the Property
         and the Building;

                           (7)      the reasonable cost of supplies for the
         cleaning and maintenance of the exterior common areas of the Property
         and the Building,

                           (8)      the reasonable cost of work uniforms and dry
         cleaning of such uniforms for those employees described in (1) above;

                           (9)      window cleaning, guard, watchman or other
         security personnel, service or system for the exterior common areas of
         the Property and the Building;

                           (10)     management fees not in excess of the lesser
         of five percent (5%) of gross revenue from the Building or the then
         prevailing market rates for management fees payable for buildings with
         similar uses to, similarly situated with, and in the same geographic
         locale as, the Building;

                           (11)     reasonable charges of independent
         contractors performing work included within this definition of
         Operating Expenses;

                           (12)     legal, accounting and other professional
         fees and disbursements incurred in connection with the operation and
         management of the Property or Building, as the case may be. Excluded,
         however, are legal, accounting and other professional fees and
         disbursements incurred in connection with negotiations or disputes with
         tenants, or in connection with leasing, renovating, or improving space
         for tenants or other occupants or prospective tenants or other
         occupants of the Property;

                           (13)     association fees and dues;

                           (14)     depreciation of hand tools and other movable
         equipment used in the operation, cleaning, repair, safety, management,
         security or maintenance of the Campus provided the original cost of
         such equipment did not constitute an Operating Expense;

                           (15)     exterior landscaping for the Property and
         interior landscaping for the common areas of the Building; and

                           (16)     amortization on a straight-line basis across
         the useful life of the cost of capital improvements to the Building,
         the Common Areas and/or the Campus (A) occasioned by any rules, laws or
         regulations effective subsequent to the Commencement Date of this
         Lease, but excluding Landlord's cost of

<PAGE>

         modifications and/or new improvements to the Building, the Common Areas
         and/or the Campus required by the Americans with Disabilities Act as in
         effect as of the Commencement date of this Lease or (B) that are
         commercially reasonable and reduce costs that would otherwise be
         included in Operating Expense or improve life/safety conditions.

         Notwithstanding anything to the contrary contained in this Lease, the
         following shall not be included within Operating Expenses:

                                            (1) Leasing commissions, attorneys'
         fees, costs, disbursements, and other expenses incurred in connection
         with negotiations or disputes with tenants, or in connection with
         leasing, renovating, or improving space for tenants or other occupants
         or prospective tenants or other occupants of the Property.

                                            (2) The cost of any service sold to
         any tenant (including Tenant) or other occupant for which Landlord is
         entitled to be reimbursed as an additional charge or rental over and
         above the basic rent and escalations payable under the lease with that
         tenant.

                                            (3) Any depreciation on the
         Property.

                                            (4) Costs of a capital nature,
         including but not limited to capital improvements and alterations,
         capital repairs, capital equipment, and capital tools as determined in
         accordance with generally accepted accounting principles.

                                            (5) Expenses in connection with
         services or other benefits of a type that are not provided to Tenant
         but which are provided another tenant or occupant of the Property.

                                            (6) Overhead profit increments paid
         to Landlord's subsidiaries or affiliates for management or other
         services on or to the building or for supplies or other materials to
         the extent that the cost of the services, supplies, or materials
         exceeds the cost that would have been paid had the services, supplies,
         or materials been provided by unaffiliated parties on a competitive
         basis.

                                            (7) All interest, loan fees, and
         other carrying costs related to any mortgage or deed of trust or
         related to any capital item, and all rental and other payable due under
         any ground or underlying lease, or any lease for any equipment
         ordinarily considered to be of a capital nature (except janitorial
         equipment which is not affixed to the Property.)

                                            (8) Any compensation paid to clerks,
         attendants, or other persons in commercial concessions operated by
         Landlord.

                                            (9) Advertising and promotional
         expenditures.

<PAGE>

                                            (10) Costs of repairs and other work
         occasioned by fire, windstorm, or other casualty of an insurable
         nature.

                                            (11) Any costs, fines, or penalties
         incurred due to violations by Landlord of any governmental rule or
         authority, this Lease or any other lease in the Property, or due to
         Landlord's negligence or willful misconduct.

                                            (12) The cost of correcting any
         building code or other violations which were violations prior to the
         Commencement Date of this Lease.

                                            (13) The cost of containing,
         removing, or otherwise remediating any contamination of the Property
         (including the underlying land and ground water) by any toxic or
         hazardous materials (including, without limitation, asbestos and
         "PCB's") where such contamination was not caused by Tenant.

                                            (14) Costs for sculpture, paintings,
         or other objects of art (and insurance thereon or extraordinary
         security in connection therewith).

                                            (15) Wages, salaries, or other
         compensation paid to any executive employees above the grade of
         building manager.

                                            (16) Any other expense that under
         generally accepted accounting principles and practice consistently
         applied would not be considered a normal maintenance or operating
         expense.

                  (b)      For each Adjustment Year falling wholly or partially
         within the Term, Tenant shall pay to Landlord as Additional Rent,
         Tenant's Proportionate Share of the amount of Operating Expenses for
         such Adjustment Year.

                  8.2      Tax Expenses.

                  (a)      For purposes of this Sublease the following
         definitions shall apply.

                           (i) "TAXES" shall mean:

                                    (1)      All real estate taxes, assessments
         (special or otherwise), sewer and water rents, rates and charges, and
         any other governmental levies, impositions and charges of a similar
         nature (but not including income taxes, franchise, capital or stock
         taxes, gift or inheritance taxes or any other tax imposed upon or
         measured by Landlord's income or profits) ("IMPOSITIONS"), which may be
         levied, assessed or imposed on or in respect of all or any part of the
         Property, whether or not the same constitute one or more tax lots (but
         not including any Imposition on any tenant's property). If, however, by
         law, any assessment may be divided and paid in annual installments,
         then, for the purposes of this definition, (i) such assessment shall be
         deemed to have been so divided and to be payable in the maximum number
         of annual installments permitted by law,

<PAGE>

         and (ii) there shall be deemed included in Taxes for an Adjustment
         Year, the annual installment of such assessment becoming payable during
         such year, together with interest payable during such year on such
         annual installment and on all installments thereafter becoming due as
         provided by law, all as if such assessment had been so divided.

                                    (2)      Any reasonable and appropriate
         expenses incurred by Landlord in contesting any of the foregoing or the
         assessed valuation of all or any part of the Property.

                                    (3)      If at any time during the Term the
         methods of taxation prevailing at the date hereof shall be altered so
         that in lieu of or in addition to whole or any part of the Impositions
         now levied, assessed or imposed on all or any part of the Property,
         there shall be levied, assessed or imposed (i) an Imposition based on
         the income or rents received therefrom whether or not wholly or
         partially as a capital levy or otherwise, or (ii) an Imposition
         measured by or based in whole or in part upon all or any part of the
         Building and imposed on Landlord, then all such Impositions shall be
         deemed to be Taxes.

                           (ii)     Taxes shall not include any of the
         following: Impositions upon improvements or alterations made by the
         Landlord or other tenants outside of the Building, or upon additions to
         the Property or Building; or penalties; or interest paid by the
         Landlord on account of taxes.

                  (b)      If, as a result of any application or proceeding or
         otherwise, there should be a reduction in the Taxes for any Adjustment
         Year in respect of which Landlord shall have previously rendered a
         Landlord's Statement, Landlord shall refund to Tenant Tenant's
         Proportionate Share of such refund, which refund shall be paid to
         Tenant within twenty (20) days after receipt by Landlord, unless Tenant
         advises Landlord within fifteen (15) days after receipt by Landlord of
         such refund to include an adjustment for the succeeding Adjustment Year
         to reflect such decrease in Taxes. Landlord may deduct from such refund
         all costs and expenses, including reasonable counsel fees, incurred by
         Landlord in connection with the application or proceeding to reduce the
         Taxes in respect of any Adjustment Year. Landlord shall promptly refund
         to Tenant Tenant's Proportionate Share of any refunds in Taxes received
         after the Expiration Date of this Lease.

                  8.3      Payment of Operating Expenses and Taxes.

                  (a)      For each Adjustment Year, Tenant shall pay to
         Landlord, as Additional Rent, Tenant's Proportionate Share of the
         actual Operating Expenses and Taxes. Notwithstanding the foregoing,
         during the applicable Adjustment Year, Tenant shall pay such
         Proportionate Share based on an estimate of such amount provided by
         Landlord in accordance with Section 8.3(b). After the close of each
         Adjustment Year, the parties shall undertake a reconciliation based on
         the estimated Proportionate Share paid by Tenant during the applicable
         Adjustment

<PAGE>

         Year and the actual Proportionate Share for such Adjustment Year in
         accordance with Section 8.3(c).

                  (b)      On or prior to the first Adjustment Date for the
         Subleased Premises and at least forty-five (45) days prior to each
         Adjustment Date thereafter, Landlord shall advise Tenant in writing of
         Landlord's good faith, reasonable estimate of Tenant's Proportionate
         Share of annual Operating Expenses for the applicable Adjustment Year
         and of Taxes for the applicable Adjustment Year. Commencing on the
         first day of each Adjustment Year, Tenant shall pay as Additional Rent
         one-twelfth (1/12th) of Tenant's estimated Proportionate Share of
         Operating Expenses and Taxes concurrently with the monthly Fixed Rent
         payment.

                  (c)      Within ninety (90) days after the close of each
         Adjustment Year, Landlord shall deliver to Tenant an itemized
         Landlord's Statement showing in reasonable detail the (i) actual
         Operating Expenses and Taxes for the previous year broken down by
         component expenses; (ii) Tenant's Proportionate Share of such Operating
         Expenses and Taxes; (iii) the amount of the estimated Proportionate
         Share of such Operating Expenses paid by Tenant during such Adjustment
         Year ;and (iv) the amount of the estimated Proportionate Share of such
         Taxes paid by Tenant during such Adjustment Year. If the amount of the
         estimated Proportionate Share of Operating Expenses and/or Taxes, as
         applicable, paid by Tenant during the applicable Adjustment Year
         exceeds the actual Proportionate Share of Operating Expenses and/or
         Taxes for such Adjustment Year, Landlord shall refund such excess
         amount to Tenant within ninety (90) days after the close of such
         Adjustment Year. Conversely, if the amount of the estimated
         Proportionate Share of Operating Expenses and/or Taxes, as applicable,
         paid by Tenant during the applicable Adjustment Year is less than the
         actual Proportionate Share of Operating Expenses and/or Taxes for such
         Adjustment Year, Tenant shall pay to Landlord the difference between
         the amount paid by Tenant and the amount actually owed for such
         Adjustment Year within thirty (30) days after receipt of Landlord's
         Statement.

                  (d)      Landlord's failure to submit a Landlord's Statement
         to Tenant within six (6) months after the expiration of any Adjustment
         Year shall be deemed a conclusive waiver of Landlord's right to any
         Additional Rent relating to such Landlord's Statement for such
         Adjustment Year. Landlord's failure to submit a Landlord's Statement
         shall not deprive Tenant of its right to recover from Landlord if
         Tenant's estimated payments exceed the amounts actually due from Tenant
         for Operating Expenses or Taxes. If Landlord has not provided a
         Landlord's Statement to Tenant within six (6) months after the
         expiration of any Adjustment Year and Tenant subsequently requests in
         writing that Landlord provide such Landlord's Statement, Landlord shall
         provide such Landlord's Statement to Tenant within thirty (30) days
         after the date on which Landlord receives such request. Subject to the
         preceding sentence, the obligations of Landlord and Tenant with respect
         to any Additional Rent shall survive the expiration or earlier
         termination of the Term.

<PAGE>

                  (e)      Landlord agrees to maintain complete records of all
         costs reimbursable by Tenant under the terms of this Lease, including
         all Operating Expenses and Taxes. All such records shall be maintained
         in accordance with generally accepted accounting practices and shall be
         retained for a period of three (3) years after the end of the
         applicable Adjustment Year. Tenant shall have the right, through itself
         or its representatives, to examine, copy and audit such records at all
         reasonable times at Landlord's office during Business Hours. Each
         Landlord's Statement shall be conclusive and binding upon Tenant
         unless, within six (6) months after the date on which Tenant receives a
         particular Landlord's Statement, Tenant notifies Landlord that it
         disputes the correctness of such Landlord's Statement. Pending the
         determination of such dispute by audit results, agreement or otherwise,
         Tenant shall pay Additional Rent in accordance with the applicable
         Landlord's Statement, and such payment shall be without prejudice to
         the position of Tenant. If Tenant's audit shows that the amount paid by
         Tenant for Operating Expenses and Taxes for any Adjustment Year exceeds
         the amount due for such period, then unless Landlord contests the
         results of the audit as provided below, Landlord shall refund the
         amount overpaid by Tenant, and if the Operating Expenses and Taxes
         exceeded by more than five percent (5%) the amount actually due, then
         Landlord shall also pay for Tenant's audit costs. If such audit shows
         that the amount paid by Tenant for Operating Expenses and Taxes was
         less than that due, then within 30 days following commencement of
         Tenant's audit, Tenant shall pay such shortfall to Landlord. If
         Landlord contests Tenant's audit, then within 30 days following
         Landlord's contest, Tenant may submit the matter to binding arbitration
         conducted by a sole arbitrator under the jurisdiction and the rules of
         the American Arbitration Association in Oakland, California. The
         arbitrator shall award fees and costs to the prevailing party."

12.      Amendment of Commencement Date. The "Commencement Date" with respect to
         the 1751 Building shall mean January 1, 2004.

13.      Amendment of Repairs and Maintenance. On January 1, 2005, the terms of
         the Sublease shall be amended from an industrial gross/full service to
         a triple net basis. Therefore, the terms of Section 12 shall be deleted
         and replaced with the following language to read as follows:

         "12.     Repairs and Maintenance.

                  (a)      During the Term, Landlord shall perform diligently,
         promptly and in a first class and good and workmanlike manner in
         compliance with all applicable Legal Requirements, all maintenance,
         repairs and replacements to: (i) the structural components of the
         Building, including without limitation the roof, exterior walls,
         bearing walls, support beams, foundations, columns, exterior doors and
         windows and lateral support to the Building; (ii) the parking lots,
         areas and garages, and the other exterior Common Areas, including their
         lighting systems; (iii) the exterior improvements to the Building,
         including walkways, shrubbery and landscaping; (iv) the plumbing and
         fire sprinkler systems servicing the Building, including electrical and
         mechanical lines and equipment associated

<PAGE>

         therewith; (vi) the Building heating, ventilation and air conditioning
         systems and electrical and mechanical lines and equipment associated
         therewith, ("HVAC"), and life safety systems for the Building; (vii)
         the elevators of the Building; (viii) the glass including cleaning and
         replacements; (ix) the roof membrane of the Building; (x) the exterior
         surfaces of the Building; and (xi) any part of the Building for which
         Tenant has not expressly assumed responsibility. The costs associated
         with Landlord's maintenance obligations with respect to the Premises
         and Building shall be deemed Operating Expenses for which Tenant shall
         bear its Proportionate Share; provided, however that the Landlord shall
         bear all of such Operating Expenses during Year 1.

                  (b)      If Tenant shall have given Landlord notice of
         Landlord's failure to perform any repair or other work which Landlord
         is required to perform under this Lease, and such failure shall
         continue unremedied for thirty (30) days following notice as aforesaid
         (or if such default is of such nature as the same cannot be cured
         within said thirty (30) day period, then if Landlord shall not have
         promptly commenced to cure such default within said thirty (30) day
         period and thereafter prosecuted the curing of such default to
         completion with due diligence), or without notice to Landlord in the
         case of an emergency, Tenant may, at its option, at any time thereafter
         perform such work and cure such default for the account of Landlord,
         and to the extent that the cost to perform such work reasonably
         expended by Tenant exceeds Tenant's Proportionate Share of the cost
         Tenant would have paid if Landlord had performed its obligations, then
         such excess out-of-pocket costs reasonably incurred by Tenant shall not
         be deemed to be an Operating Expense, Tenant shall not have any
         liability with respect to such excess costs, and Landlord agrees to
         reimburse Tenant such costs within thirty (30) days of written demand
         therefor by Tenant. In the event that Landlord fails to make such
         payment when due, it shall bear interest until paid at the Interest
         Rate.

                  (c)      Except for Landlord's obligations as set forth in
         Paragraph 12(a) above, during the Term, Tenant shall, at its sole
         expense, maintain the interior portion of the Subleased Premises in
         good condition and repair, including, but not limited to, (i) perform
         its own redecorating of the interior of the Subleased Premises if
         desired by Tenant; (ii) be responsible for all maintenance and repairs
         of the interior of the Subleased Premises and any maintenance or
         repairs required as a result of Tenant's negligence, unless covered by
         any insurance policy maintained or required to be maintained by
         Landlord or unless caused by the gross negligence or willful misconduct
         of Landlord, its agents or representatives; and (iii) maintain all
         computer and telecommunications wiring and outlets, any interior glass,
         and Landlord's furniture within the Subleased Premises in as good a
         condition as existed on January 1, 2004, reasonable wear and tear
         excepted. If Tenant fails to do so, Landlord may give Tenant notice
         thereof and if Tenant does not remedy such deficiency within 45 days of
         the giving of such notice, then Landlord may, but shall not be required
         to, enter the Subleased Premises and put them in good condition, and
         Landlord's costs thereof as set forth in Landlord's demand to Tenant
         shall automatically become due and payable as Additional Rent. Tenant
         shall reimburse Landlord within thirty (30) days following its

<PAGE>

         demand for all costs incurred by Landlord, plus an administrative fee
         of five percent (5%) of such costs, in making alterations to the
         structural, mechanical, electrical, plumbing or life safety systems of
         the Building and to the Common Areas which may be required under
         applicable Legal Requirements as a result of Tenant's particular use of
         the Premises or Alterations made within the Premises by Tenant or by
         Landlord at the request of Tenant."

14.      Amendment of Service and Utilities. On January 1, 2005, the terms of
         the Sublease shall be amended from an industrial gross to a triple net
         basis. Therefore, the terms of Section 13 shall be deleted and replaced
         with the following language to read as follows:

         13.      Services and Utilities

                  (a)      Landlord shall provide all services for the Building
         and Subleased Premises consistent with an office flex/research and
         development building in the geographic area where the Property is
         located, the cost of which shall be included in Operating Expenses.

                  (b)      At Tenant's option, Landlord shall provide janitorial
         and cleaning services for the Subleased Premises, the actual,
         reasonable cost of which shall be included in Operating Expenses.

                  (c)      Tenant shall pay for all utilities consumed on the
         Subleased Premises, including after-hours usage.

                  (d)      Parking. Tenant shall have the right to use an
         unlimited number of non-exclusive, non-reserved parking spaces at the
         Building for the use of Tenant's employees and business visitors,
         subject to any applicable rules and regulations. Notwithstanding
         anything in the Prime Lease to the contrary, Tenant shall not be
         entitled to reserved parking. Landlord agrees that none of the tenants,
         in addition to Tenant, in the 1751 Building shall be permitted to have
         any reserved parking.

                  (e)      Signage. Tenant shall have the right to have its
         company name listed in the building directory located in the lobby of
         the Building, if any, at no additional charge to Tenant. Tenant shall
         also be allowed signage on entry doors to Tenant's suite and Landlord
         shall work with Tenant to accommodate reasonable additional signage
         directing visitors to Tenant's suite at no additional charge to Tenant.
         Tenant shall be allowed to have signage in front of the Building at no
         additional charge to Tenant, provided that such signage meets the
         reasonable signage guidelines established by Landlord.

15.      Peninsula's Leasing of Subleased Premises As-Is. Subject to Section 15,
         Peninsula hereby acknowledges and agrees that it is leasing, and hereby
         accepts, the Subleased Premises in the 1751 Building in its AS-IS
         condition and no further improvements shall be made by Landlord, except
         that Landlord agrees to repair the carpeting throughout the Subleased
         Premises, and remove map wallpaper and

<PAGE>

         paint the underlying wall in one of the offices in the Subleased
         Premises prior to December 1, 2003. Tenant shall accept the Premises in
         its "as-is" condition as of the date of delivery by Landlord. Tenant
         shall have the right to use the exisiting furniture within the
         Subleased Premises during the Lease term, and shall return such
         furniture at the Lease term expiration in good condition, subject to
         normal wear and tear only.

16.      Notwithstanding anything to the contrary in this Lease, Landlord
         warrants to the best of its knowledge and without further independant
         investigation, that on the commencement of the term hereof, (a) the
         Property and Building shall comply with all laws, codes, ordinances and
         other governmental requirements then applicable to the Property and
         Building, and (b) the Subleased Premises, including the improvements
         and equipment therein, shall be in good working order, condition, and
         repair.

17.      Each Party's addresses for notice purposes under Section 32 of the
         Sublease shall be deleted and replaced with the following:

         If to Tenant prior to January 1, 2004:

         Peninsula Pharmaceuticals, Inc.
         1701 Harbor Bay Parkway
         Alameda, CA  94502
         Attn:  President & Chief Executive Officer

         If to Tenant on or after January 1, 2004:

         Peninsula Pharmaceuticals, Inc.
         1751 Harbor Bay Parkway
         Alameda, CA  94502
         Attn:  President & Chief Executive Officer

         If to Landlord:

         SRM-PCCP Harbor Bay Associates, LLC
         c/o SRM Associates
         1851 Harbor Bay Parkway, Suit 2000
         Alameda, CA 94501
         Attn: Property Manager

18.      Deletion of Section 38. Section 38 of the Sublease shall be deleted in
         its entirety.

19.      Brokers. Each party hereby acknowledges that no broker, finder or other
         person has represented such party with respect to this Amendment. Each
         party agrees to indemnify, defend and hold the other party harmless
         from all demands, judgments, damages, costs and expenses (including
         attorneys' fees and costs) resulting from any claims that may be
         asserted against the other party by any broker, finder or

<PAGE>

         other person with whom the indemnifying party has or purportedly has
         dealt in connection with this Amendment.

20.      Successors and Assigns. All of the covenants, terms and conditions set
         forth herein shall be binding upon and inure to the benefit of the
         parties hereto and their respective successors and assigns.

21.      Right of First Opportunity. Landlord and Tenant acknowledge that as of
         the date of mutual execution of this First Amendment, the remaining
         space on the second floor of the Building of approximately 25,400 rsf
         ("Adjacent Space") is vacant and available for lease. Subject to any
         superior rights of any third party tenant, provided this Lease is in
         full force and effect and Tenant is not in default hereunder, Landlord
         shall notify Tenant at such time as it receives a bonafide proposal
         from a third party tenant to lease any portion of the Adjacent Space.
         Tenant shall have a right of first opportunity to negotiate with
         Landlord to lease such Adjacent Space. Conversely, Tenant shall keep
         Landlord apprised of its space requirements if, during the Lease term,
         Tenant's space needs exceed the Subleased Premises. Furthermore, if,
         after fifteen (15) days of negotiation, Landlord and Tenant are unable
         to agree on mutually satisfactory terms for Tenant to lease the
         Adjacent Space, then Landlord shall be free to deal with such Adjacent
         Space, with no further regard to Tenant.

                  (Remainder of Page Left Intentionally blank)

<PAGE>

22.      Ratification of Lease Terms. All other non-conflicting terms,
         provisions, covenants and conditions of the Lease, Sublease and all
         exhibits and addendum thereto shall continue in full force and effect
         and are hereby ratified by the parties hereto.

LANDLORD:                                         PENINSULA:
SRM/PCCP HARBOR BAY ASSOCIATES, LLC,              PENINSULA PHARMACEUTICALS INC.
a Delaware limited liability company              a Delaware corporation
     By: PCCP LB Harbor Bay Associates, LLC
         a Delaware limited liability company
         Its: Managing Member
     By: PCCP Equities II, LLC
         a Delaware limited liability company
         Its: Co-Managing Member

By:  /s/ Aaron Giovara                      By: /s/ Paul F. Truex
     -------------------------------            --------------------------------
Name:    Aaron Giovara                      Name:  Paul F. Truex
Title:   Vice President                     Title: President and CEO

<PAGE>

                                   EXHIBIT A-1

                                   [GRAPHIC]

<PAGE>

                                  EXHIBIT B-1

1751 INVENTORY 2ND FLOOR WEST SIDE
10/14/2003

Outside Hallway

                  Black/Red Credence Table 8'                            1

Conference Room 2000/Flight Room

                  Black Leather Chairs                                  14
                  Black/Maroon Training Table 12'                        2
                  Black/Maroon Training Table Round Corner
                        Right side round                                 1
                        Left side round                                  1
                  Black/Maroon Side Table 8'7"                           1
                  Black/Maroon Podium                                    1
                  Black Dry Erase Board 20'x 48"                         1

Room 2004

                  Lab Racks                                              4

Inside Hallway

                  DFM Shelf 48"x 12"                                     1

Room 2201 A & B

                  Black Task Chairs                                      2
                  Black Liberty Guest Chair                              1
                  Rosemount Teardrop                                     1
                  Pedestal    BBF                                        2
                              FF                                         2
                  Rosemount Station with double overhead                 1
                  Rosemount Gray Station                                 1
                  Whiteboard 36" 48"                                     1
                  Meridian two drawer lateral cabinet (locked no key)    1

Kitchen

                  Refrigerator                                           1
                  Dishwasher                                             1
                  Message board 36" x 48"                                1
                  First Aid Cabinet                                      1
                  Recycle Garbage Can                                    1
                  Floor Mat 44" x 65"                                    1

<PAGE>

Room 2202

                  Gray Liberty Guest Chair                               2
                  DFM 36" round table                                    1
                  Black Task Chairs                                      1
                  DFM Station                                            1
                  DFM Dry Erase 48" x 60"                                1
                  DFM Pedestal BBF                                       1
                  DFM Pedestal FF                                        1
                  Putty two drawer lateral file cabinet                  1
                  Black cloth board 102" x 24"                           1

Room 2203

                  DFM Station                                            1
                  DFM three shelf bookcase                               1
                  DFM four drawer lateral file                           1
                  DFM dry erase board 48" x 60"                          1
                  DFM Pedestal BBF                                       1
                  DFM Pedestal FF                                        1
                  Gray Liberty Guest Chairs                              2
                  Black Task chairs                                      1
                  Black cloth board 102" x 24"                           1

Room 2204

                  Rosemount Station                                      1
                  Rosemount Teardrop                                     1
                  Gray Liberty guest chair                               1
                  Black Task Chair                                       1
                  Gray Pedestal BBF                                      1
                  Gray Pedestal FF                                       2
                  Gray two shelf bookcase                                1
                  Whiteboard 36" x 48"                                   1

Room 2205

                  Rosemount Station                                      1
                  Gray Pedestal BBF                                      1
                  Gray Pedestal FF                                       1
                  Black Task Chair                                       1
                  Whiteboard 36" x 48"                                   1

Room 2206

                  DFM Station                                            1
                  DFM three shelf bookcase                               1
                  DFM four drawer lateral file cabinet                   1
                  DFM Dry Erase 48" x 60"                                1
                  Black task chair                                       1
                  Gray Liberty Guest Chair                               2
                  Black cloth board 102" x 24"                           1

<PAGE>

                  DFM Pedestal BBF                                       1
                  DFM Pedestal FF                                        1

Room 2207

                  DFM Station                                            1
                  DFM three shelf bookcase                               1
                  DFM four drawer lateral file cabinet                   1
                  DFM Dry Erase 48" x 60"                                1
                  Black Task Chair                                       1
                  Gray Liberty Guest Chair                               2
                  Wall Picture                                           1
                  DFM Pedestal BBF                                       1
                  DFM Pedestal FF                                        1

Room 2210

                  Rosemount Station                                      1
                  Rosemount Teardrop                                     I
                  Whiteboard 36" x 48"                                   1
                  Black Task Chair                                       1
                  Gray Pedestal BBF                                      1
                  Gray Pedestal FF                                       2
Room 2211

                  Rosemount Station                                      1
                  Gray Pedestal BBF                                      1
                  Gray Pedestal FF                                       1
                  Black Task Chair                                       1

Storage Room/ Room 2212

                  Fire King Safe four drawer letter size                 1
                  Supply Cabinet five shelf 36" x 72"                    1
                  Supply Cabinet four shelf 36" x 66"

Copy Room/ Room 2213

                  Folding tables 60"                                     2
                  Gray three shelf bookcase                              1

Room 2232

                  Rosemount Station                                      1
                  Rosemount Teardrop                                     1
                  Black Task Chair                                       1
                  Whiteboard 36" x 48"                                   1
                  Gray Pedestal BBF                                      1
                  Gray Pedestal FF                                       1

Room 2231/Meeting Room

                  Gray Round table 48"                                   1
                  Gray Conference Room Chairs                            4

<PAGE>

Room 2230

                  Rosemount Station                                      1
                  Black Task Chair                                       1
                  Gray Liberty Guest Chair                               1
                  Gray Pedestal BBF                                      1
                  Gray Pedestal FF                                       1
                  Whiteboard 36" x 48"                                   1

Room 2228

                  DFM Station - long desk                                1
                  DFM two drawer lateral file cabinet                    1
                  DFM three shelf bookcase                               1
                  DFM Dry Erase 48" x 48"                                1
                  DFM Pedestal BBF                                       1
                  DFM four drawer lateral file cabinet                   1
                  Black Task Chair                                       1
                  Gray Liberty Guest Chair                               3
                  Black Cloth board 102" x 24"                           1

Room 2223/Conference Room

                  Black/Gray Conference Table 105"                       1
                  Gray Conference Chairs                                 7
                  Rosemount Teardrop                                     1
                  Whiteboard 36" x 48"                                   1

Room 2222

                  DFM Station                                            1
                  DFM four drawer lateral file cabinet                   1
                  DFM Pedestal BBF                                       1
                  DFM Pedestal FF                                        1
                  DFM three shelf bookcase                               1
                  DFM Dry Erase 48" x 60"                                1
                  Black Cloth board 102" x 24"                           1
                  Black Task Chair                                       1

Room 2221

                  DFM Station                                            1
                  DFM four drawer lateral file cabinet                   1
                  DFM three shelf bookcase                               1
                  DFM Pedestal BBF                                       1
                  DFM Pedestal FF                                        1
                  Black Cloth board 102" x 24"                           2
                  Black Task Chair                                       1
                  DFM Dry Erase 48" x 60"                                1

<PAGE>

Room 2220

                  DFM Station                                            1
                  DFM Pedestal BBF                                       1
                  DFM Pedestal FF                                        1
                  Gray Liberty Guest Chair                               4
                  Black Task Chair                                       1

Cubical #1

                  Portable printer station                               1
                  Gray Pedestal BBF                                     28
                  Gray Pedestal FF                                      27
                  Black Task Chair                                      23
                  Teknion Workstation                                   24
                  Gray Liberty Guest Chair                               3
                  Privacy Screen                                         4
                  Stationary printer station                             1
                  Gray two drawer lateral file cabinet                   1
                  Black Conference Chair                                 1

Cubical #2

                  Teknion Workstation                                    6
                  Gray Pedestal BBF                                     10
                  Gray Pedestal FF                                      10
                  Black Task Chair                                       6
                  Black Liberty Guest Chair                              1
                  Gray two drawer lateral file cabinet                   1

Cubical #3

                  Teknion Workstation                                    8
                  Gray Pedestal BBF                                      8
                  Gray Pedestal FF                                       9
                  Black Task Chair                                       7
                  Gray Conference Chairs                                 1
                  Privacy Screen                                         1
                  Stationary printer station                             2

Cubical #4

                  Teknion Bullpen                                        1
                  Gray Conference Chair                                  1
                  Black Conference Chair                                 1
                  Black Task Chair                                       2

IMPORTANT NOTE: The above list is intended to reflect the inventory of
furnishings and equipment presently within the Premises. Tenant should
independently verify the accuracy of this list. Under no circumstances does the
First Amendment imply that if any item above is not actually located within the
Premises as of the Execution Date that Landlord shall be obligated to procure
same their cost or otherwise.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00059-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00059-of-00352.parquet"}]]