Document:

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                                                                   Exhibit 10.08

                            STANDARD INDUSTRIAL LEASE

1.       BASIC LEASE PROVISIONS. 1.1

         1.1  DATE:                      July 18, 2003

         1.2  LANDLORD:                  The Realty Associates Fund III, L.P., a
                                         Delaware limited partnership

         1.3  TENANT:                    Celerity Group, Inc., a California
                                         corporation

         1.4  PREMISES ADDRESSES:        1507 & 1515 Centre Pointe Drive,
                                         Milpitas, California (LFN:K100-130)

         1.5  APPROXIMATE LEASABLE       46,102
              AREA OF PREMISES:
              (in square feet)

         1.6  USE:                       Office, engineering, sales, storage and
                                         light manufacturing and other legal
                                         uses related to Celerity Group, Inc.'s
                                         present operations in the Premises, so
                                         long as none of the above uses involve
                                         Hazardous Materials (as defined below)
                                         except as expressly permitted by the
                                         terms of this Lease

         1.7 TERM:                       Commencement Date through July 31, 2009

         1.8 COMMENCEMENT DATE:          Upon mutual execution of this Lease by
                                         Landlord and Tenant

         1.9  MONTHLY BASE RENT:         Commencement Date through July 31,
                                         2003: $56,244.44; August 1, 2003
                                         through July 31, 2004: $46,102.00;
                                         and August 1, 2004 through July 31,
                                         2005: $48,407.10.

         1.10 BASE RENT PAID
              UPON
              EXECUTION:                 None

              APPLIED To:                N/A
              (Insert month(s))

         1.11 TENANT'S PERCENTAGE        22.22%
              SHARE (See also
              section 6.4)

         1.12 SECURITY DEPOSIT.          None

         1.13 NUMBER OF PARKING SPACES:  165

         1.14 REAL ESTATE BROKER:

                 LANDLORD:               Insignia ESG

                 TENANT:                 Staubach Global Services (Landlord
                                         shall have no obligation to pay a
                                         commission of other compensation to
                                         Staubach Global Services and Tenant
                                         shall be solely responsible for the
                                         payment of any such commission or other
                                         compensation

         1.15 EXHIBITS ATTACHED TO       Exhibit A - "Premises;" Exhibit B -
                 LEASE:                  intentionally deleted Exhibit C
                                         - "Rules and Regulations;" Exhibit D -
                                         "Form of HazMat Certificate"; Exhibit E
                                         -"Addendum to Lease"; Exhibit F -
                                         "Guaranty of Lease"

         1.16 ADDRESSES FOR NOTICES:

                 LANDLORD:               c/o TA Associates Realty 1301 Dove
                                         Street, Suite 860 Newport Beach,
                                         California 92660 Attention: Asset
                                         Manager

                 WITH A COPY TO:         insignia ESG 160 W. Santa Clara Street,
                                         12th Floor San Jose, California 95113
                                         Attention: Property Manager

                TENANT:                  Celerity Group, Inc., a
                                         California corporation 1463 Centre
                                         Pointe Drive Milpitas, California 95035
                                         Attention: Will Seppl

                WITH A COPY TO:          Celerity Group, Inc. 400 Parker Drive,
                                         Suite 1100 Austin, Texas 78728
                                         Attention: Randy Green

                GUARANTOR:               Kinetics Group, inc., a Delaware
                                         corporation 2805 Mission College
                                         Boulevard Santa Clara, California 95054
                                         Attention: John Goodman, General
                                         Counsel

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             Attention: John Goodman, General Counsel

2.       PREMISES.

         2.1      ACCEPTANCE. Landlord leases to Tenant, and Tenant leases from
Landlord, the Premises, to have and to hold for the term of this Lease, subject
to the terms, covenants and conditions of this Lease. The Premises is depicted
on Exhibit "A" attached hereto. The Premises depicted on Exhibit "A" is all or a
part of a building (the "Building") and may contain areas outside of the
Building to the extent such areas are specifically identified on Exhibit "A" as
being a part of the Premises. Tenant accepts the Premises in its condition as of
the Commencement Date, subject to all applicable laws, ordinances, regulations,
covenants, conditions, restrictions and easements in existence on the
Commencement Date, and except as may be otherwise expressly provided herein,
Landlord shall not be obligated to make any repairs or alterations to the
Premises. Tenant acknowledges that Landlord has made no representation or
warranty as to the suitability of the Premises for the conduct of Tenant's
business, and Tenant waives any implied warranty that the Premises are suitable
for Tenant's intended purposes. The number of square feet set forth in section
1.5 is an approximation, and the Base Rent shall not be changed if the actual
number of square feet in the Premises is different than the number of square
feet set forth in section 1.5.

         2.2      COMMON AREAS. Landlord hereby grants to Tenant for the benefit
of Tenant and its employees, suppliers, shippers, customers and invitees during
the term of this Lease, the nonexclusive right to use, in common with others
entitled to such use (including Landlord), the Common Areas (as hereinafter
defined) as they exist from time to time, subject to all rights reserved by
Landlord hereunder and under the terms of all rules and regulations promulgated
by Landlord from time to time with respect thereto. Landlord reserves the right
from time to time to (a) make changes in the Common Areas, including, without
limitation, changes in location, size, shape and number of driveways, entrances,
parking spaces, parking areas, loading and unloading areas, ingress, egress,
direction of traffic, landscaped areas and walkways; (b) dose temporarily any of
the Common Areas for maintenance purposes so long as reasonable access to the
Premises remains available; (c) construct additional buildings, parking areas,
loading dock facilities and other improvements within the Common Areas; and (d)
do and perform such other acts and make such other changes in, to or with
respect to the Common Areas as Landlord may deem appropriate. As used herein,
the term "Common Areas" means all areas and facilities outside the Premises and
within the exterior boundary lines of the land owned by Landlord that are
provided and designated by Landlord as such from time to time for general
nonexclusive use of Tenant and others, including, if designated by Landlord as
Common Areas, parking areas, loading and unloading areas, trash areas, roadways,
sidewalks, walkways, parkways and landscaped areas. The Premises, the Building,
the Common Areas, the land upon which the same are located, along with all other
buildings and improvements thereon, are herein collectively referred to as the
"Project". Under no circumstances shall the right herein granted to use the
Common Areas be deemed to include the right to store any property, temporarily
or permanently, in the Common Areas, including, without limitation, the storage
of trucks or other vehicles. Any such storage shall be permitted only by the
prior written consent of Landlord, which consent may be revoked at any time. in
the event that any unauthorized storage shall occur then Landlord shall have the
right, after giving Tenant ten (10) days advance written notice, in addition to
such other rights and remedies that it may have, to remove the property and
charge the cost to Tenant, which cost shall be immediately payable upon demand
by Landlord. Notwithstanding the forgoing, Tenant shall have the right to
temporarily store small amounts of materials In the back of the Premises to
facilitate the transfer of materials to and from the Premises (Temporary
Transfer Storage") provided such Temporary Transfer Storage (a) complies with
all of Landlord's reasonable requirements (including, but not limited to, the
location of the storage) and (b) such storage is permitted by and complies with
all applicable laws, regulations and covenants, conditions and restrictions
applicable to the outside storage or the Project. Temporary Transfer Storage
shall only occur occasionally and shall not result in the storage of materials
outside the Premises for more than fifteen (15) days at any one time. It is the
Intent of Landlord and Tenant that there be no Temporary Outside Storage at most
times.

3.       TERM.

         3.1      TERM AND COMMENCEMENT DATE. The term and Commencement Date of
this Lease are as specified in sections 1.7 and 1.8.

         3.2      Intentionally deleted.

         3.3      Intentionally deleted.

         3.4      Intentionally deleted.

         3.5      Intentionally deleted.

4.       USE.

         4.1      PERMITTED USE. The Premises shall be used only for the purpose
described in section 1.6 and for no other purpose. Landlord makes no
representation or warranty that Tenant's use is permitted by applicable zoning
laws or other laws and regulations. In no event shall any portion of the
Premises be used for retail sales. Tenant shall not initiate, submit an
application for, or otherwise request, any land use approvals or entitlements
with respect to the Premises or any other portion of the Project, including,
without limitation, any variance, conditional use permit or rezoning ("Land Use
Approvals"), without first obtaining Landlord's prior written consent, which may
be given or withheld In Landlord's sole discretion (the foregoing shall not be
interpreted to prohibit Tenant from obtaining permits for its operations which
do not constitute Land Use Approvals). Tenant shall not (a) permit any animals
or pets to be brought to or kept in the Premises, (b) install any antenna, dish
or other device on the roof of the Building or outside of the Premises, (c) make
any penetrations Into the roof of the Building, (d) place loads upon floors,
walls or ceilings in excess of the load such items were designed to carry, (e)
except for the Temporary Transfer Storage, place or store, nor permit any other
person or entity to place or store, any property, equipment, materials, supplies
or other Items outside of the Building in which the Premises is located or (f)
change the exterior of the Premises or the Building in which the Premises is
located.

         4.2      COMPLIANCE WITH LAWS. Tenant shall, at Tenant's sole expense,
promptly comply with all applicable laws, ordinances, rules, regulations,
orders, certificates of occupancy, conditional use or other permits, variances,
covenants, conditions, restrictions, easements, the recommendations of
Landlord's engineers or other consultants, and requirements of any fire
insurance underwriters, rating bureaus or government agencies, now in effect or
which may hereafter come Into effect, whether or not they reflect a change in
policy from that now existing, during the term or any part of the term hereof,
relating in any manner to the occupation and use by Tenant of the Premises.
Tenant shall, at Tenant's sole expense, comply with all requirements of the
Americans With Disabilities Act that relate to the Premises, and all federal,
state and local laws and regulations governing occupational safety and health.
Tenant shall not permit any objectionable or unpleasant odors, smoke, dust, gas,
noise or vibrations to emanate from the Premises, or take any other action that
would constitute a nuisance or would disturb, unreasonably interfere with or
endanger Landlord or any other tenants of the Project. Tenant shall obtain, at

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its sole expense, any permit or other governmental authorization required to
operate its business from the Premises. Landlord shall not be liable for the
failure of any other tenant or person to abide by the requirements of this
section or to otherwise comply with applicable laws and regulations, and Tenant
shall not be excused from the performance of its obligations under this Lease
due to such a failure. Tenant acknowledges that the leases of other tenants may
not obligate them to comply with some or all of the requirements of this
section. However, if the lease of another tenant does obligate the tenant to
comply with a requirement of this section, and the tenant's failure to comply
with such requirement is having a material adverse effect on Tenant's use of the
Premises, Landlord shall cooperate with Tenant in attempting to cause the tenant
to comply with the requirement, provided, however, Landlord shall have no
obligation to bring a legal action against the non-complying tenant.

5.       BASE RENT. Tenant shall pay Base Rent in the amount set forth on the
first page of this Lease. The first month's Base Rent, the Security Deposit, and
the first monthly installment of estimated Operating Expenses (as hereafter
defined) shall be due and payable on the date this Lease is executed by Tenant,
and Tenant promises to pay to Landlord in advance, without demand, deduction or
set-off, monthly Installments of Base Rent on or before the first day of each
calendar month succeeding the Commencement Date. Payments of Base Rent for any
fractional calendar month shall be prorated. All payments required to be made by
Tenant to Landlord hereunder shall be payable at such address as Landlord may
specify from time to time by written notice delivered in accordance herewith.
Tenant shall have no right at any time to abate, reduce, or set off any rent due
hereunder except where expressly provided In this Lease.

6.       OPERATING EXPENSE PAYMENTS.

         6.1      OPERATING EXPENSES. Tenant shall pay Tenant's Percentage Share
(as defined below) of the Operating Expenses for the Project to the extent such
Operating Expense relate directly to the Project. For the purposes of this
Lease, the term "OPERATING EXPENSES" shall mean all expenses and disbursements
of every kind (subject to the limitations set forth below) which Landlord
incurs, pays or becomes obligated to pay in connection with the ownership,
operation, and maintenance of the Project (including the associated Common
Areas), including, but not limited to, the following:

                  (a)      a reasonable management fee intended to cover
management fees and wages and salaries of ail employees, agents, consultants and
other individuals or entities engaged in the operation, repair, replacement,
maintenance, and security of the Project, including taxes, insurance and
benefits relating thereto;

                  (b)      all supplies and materials used in the operation,
maintenance, repair, replacement, and security of the Project;

                  (c)      annual cost of all Capital Improvements (amortized
over the useful economic life of such improvements as determined by Landlord in
its reasonable discretion (without regard to the period over which such
improvements may be depreciated or amortized for federal income tax purposes).
Capital Improvements shall not Include any expenditure Incurred by Landlord to
maintain the structural elements of the roof of the Building (excluding the roof
membrane), the structural soundness of the foundation of the Building, the
structural elements of the exterior walls of the Building and the structural
elements of existing interior load bearing walls of the Building (excluding any
load bearing walls constructed by Tenant, which Tenant shall maintain and repair
at Tenant's sole expense), and the cost of such items shall be paid by Landlord,
at Landlord's sole cost and expense;

                  (d)      cost of all utilities paid by Landlord;

                  (e)      cost of any insurance or insurance related expense
applicable to the Project (excluding any insurance deductible except as
expressly permitted by section 6.2 below) and Landlord's personal property used
in connection therewith, including, but not limited to, the insurance costs
described In section 10.2;

                  (t)      cost of repairs, replacements and general maintenance
of the Project (including all truck court areas, paving and parking areas,
Common Area lighting facilities, fences, gates, water lines, sewer lines, rail
spur areas and any other Item Landlord is obligated to repair or maintain),
other than costs necessary to assure the structural soundness of the roof,
foundation and exterior walls of the Project or any other costs which are
payable solely by Landlord under section 11.1;

                  (g)      cost of service or maintenance contracts with
independent contractors for the operation, maintenance, repair, replacement or
security of the Project (including, without limitation, alarm service, exterior
painting, trash collection, snow, ice, debris and waste removal and landscape
maintenance);

                  (h)      the cost of all accounting fees, management fees,
legal fees and consulting fees attributable to the operation, ownership,
management, maintenance or repair of the Project;

                  (i)      payments made by Landlord under any easement,
license, operating agreement, declaration, restrictive covenant or other
agreement relating to the sharing of costs among property owners;

                  (j)      intentionally deleted.

                  (k)      the cost of all business licenses, permits or similar
fees relating to the operation, ownership, repair or maintenance of the Project;
and

                  (l)      the cost of any other item the cost of which is
stated in this Lease to be an Operating Expense.

For purposes of this Lease, a "CAPITAL IMPROVEMENT" shall be an improvement to
the Project that Landlord is obligated to make pursuant to this Lease, the cost
of which is not fully deductible in the year Incurred in accordance with
generally accepted accounting principles ("GAAP"); provided, however, that, at
Landlord's option, the cost of painting all or part of the Project shall be
treated as an expense and not as a CAPITAL IMPROVEMENT. Real Properly Taxes (as
defined below) shall be reimbursed to Landlord as provided below and shall not
be treated as an Operating Expense. References to facilities, services,
utilities or other items in this section shall not impose an obligation on
Landlord to have said facilities or to provide said services unless such
facilities and services already exist at the Project.

         6.2      OPERATING EXPENSE EXCLUSIONS. Notwithstanding anything to the
contrary contained herein, for purposes of this Lease the term "OPERATING
EXPENSES" shall not include the following: (i) costs (including permit, license
and inspection fees) incurred for tenant improvements for other tenants within
the Project; (ii) legal and auditing fees (other than those fees reasonably
incurred in connection with the maintenance and operation of all or any portion
of the Project), leasing commissions, advertising expenses and similar costs
Incurred In connection with the leasing of the Project; (III) depreciation of
the Building or any other improvements situated within the Project; (iv) any
ferns for which Landlord is actually reimbursed

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by insurance or by direct reimbursement by any other tenant of the Project; (v)
costs of repairs or other work necessitated by fire, windstorm or other casualty
(excluding any deductibles) and/or costs of repair or other work necessitated by
the exercise of the right of eminent domain to the extent Insurance proceeds or
a condemnation award, as applicable, is actually received by Landlord for such
purposes; provided, such costs of repairs or other work shall be paid by the
parties in accordance with the provisions of sections 11 and 12, below; (vi)
other than any interest charges for Capital Improvements referred to in section
6.1 (c) hereinabove, any Interest or payments on any financing for the Building
or the Project and interest and penalties incurred as a result of Landlord's
late payment of any invoice; (vii) costs associated with the Investigation
and/or remediation of Hazardous Materials (hereafter defined) present In, on or
about any portion of the Project, unless such costs and expenses are the
responsibility of Tenant as provided in section 27 hereof, in which event such
costs and expenses shall be paid solely by Tenant In accordance with the
provisions of section 27 hereof; (viii) overhead and profit increment paid to
Landlord or to subsidiaries or affiliates of Landlord for goods and/or services
in the Project to the extent the same exceeds the costs of such by unaffiliated
third parties on a competitive basis; (ix) any payments under a ground lease or
master lease; (x) except as provided in section 6.1(c) above, the cost of
Capital Improvements and (xi) the cost of any insurance deductibles to the
extent such deductibles exceed $50,000 in any one year.

         6.3      PAYMENT. Tenant's Percentage Share of Operating Expenses shall
be payable by Tenant within fifteen (16) days after a reasonably detailed
statement of actual expenses Is presented to Tenant by Landlord. At Landlord's
option, however, Landlord may, from time to time, estimate what Tenant's
Percentage Share of Operating Expenses will be, and the same shall be payable by
Tenant monthly during each calendar year of the Lease term, on the same day as
the Base Rent is due hereunder. In the event that Tenant pays Landlord's
estimate of Tenant's Percentage Share of Operating Expenses, Landlord shall use
its best efforts to deliver to Tenant within one hundred fifty (150) days after
the expiration of each calendar year a reasonably detailed statement (the
"STATEMENT") showing Tenant's Percentage Share of the actual Operating Expenses
incurred during such year. If Landlord has not delivered a Statement to Tenant
within one hundred fifty (150) days after the expiration of the preceding
calendar year, Tenant shall have the right to give Landlord written notice of
such failure (a "Tenant Notice"), and Landlord's failure to provide the
Statement to Tenant within thirty (30) days after Landlord receives the Tenant
Notice shall be a default by Landlord under this Lease. To be effective, the
Tenant Notice must specifically state that Landlord's failure to provide the
Statement to Tenant within thirty (30) days after Landlord's receipt of the
Notice will constitute a default and the Tenant Notice must refer specifically
to this section of the Lease. Landlord's failure to deliver the Statement to
Tenant within said period shall not constitute Landlord's waiver of its right to
collect said amounts or otherwise prejudice Landlord's rights hereunder;
provided, however, Landlord shall not have the right to collect from Tenant any
Operating Expense that was known by Landlord and which was not billed to Tenant
within one year after the expiration of the calendar year in which the Operating
Expense was incurred. If Tenant's payments under this section during said
calendar year exceed Tenant"s Percentage Share as indicated on the Statement,
Tenant shall be entitled to credit the amount of such overpayment against
Tenant's Percentage Share of Operating Expenses next falling due. If Tenant's
payments under this section during said calendar year were less than Tenant's
Percentage Share as indicated on the Statement, Tenant shall pay to Landlord the
amount of the deficiency within thirty (30) days after delivery by Landlord to
Tenant of the Statement Landlord and Tenant shall forthwith adjust between them
by cash payment any balance determined to exist with respect to that portion of
the last calendar year for which Tenant is responsible for Operating Expenses,
notwithstanding that the Lease term may have terminated before the end of such
calendar year; and this provision shall survive the expiration or earlier
termination of the Lease.

         6.4      TENANTS PERCENTAGE SHAKE. TENANTS PERCENTAGE SHARE" as used In
this Lease shall mean the percentage of the cost of Operating Expenses and Real
Property Taxes (as defined below) for which Tenant is obligated to reimburse
Landlord pursuant to this Lease. Notwithstanding anything to the contrary
contained in section 1.11, Landlord shall have the right to determine Tenants
Percentage Share of the cost of Operating Expenses and Real Property Taxes using
any one or more of the following three methods, and Tenant hereby agrees that
any one of the following three methods of allocation Is reasonable: (a) by
multiplying the cost of all Operating Expenses or Real Property Taxes by a
fraction, the numerator of which is the number of square feet of leasable space
in the Premises and the denominator of which is the number of square feet of
leasable space In all buildings in the Project from time to time (e.g., if
Landlord sold one of the buildings that now comprises the Project, this
reduction in Project square footage shall be taken into consideration In
determining Tenant's Percentage Share of the Project); or (b) (I) with respect
to an Operating Expense or Real Property Taxes attributable solely to the
Building, requiring Tenant to pay that portion of the cost of the Operating
Expense or Real Property Taxes that is obtained by multiplying such cost by a
fraction, the numerator of which is the number of square feet of leasable space
In the Premises and the denominator of which Is the number of square feet of
leasable space in the entire Building (if the Building Is modified to Increase
or decrease its square footage, this increase or decrease shall be taken Into
consideration in determining Tenants Percentage Share of the Building) and (ii)
with respect to an Operating Expense or Real Property Taxes attributable to the
Common Areas of the Project, but not any particular building in the Project,
requiring Tenant to pay that portion of the cost of the Operating Expense or
Real Property Taxes that is obtained by multiplying such cost by a fraction, the
numerator of which is the number of square feet of leasable space in the
Premises and the denominator of which is the number of square feet of leasable
space in all buildings in the Project or (c) by allocating an Operating Expense
or Real Property Taxes in any other commercially reasonable manner.

         6.5      AUDITS. If Tenant disputes the amount set forth in the
Statement, Tenant shall have the right, at Tenant's sole expense, not later than
sixty (60) days following receipt of such Statement, to cause Landlord's books
and records with respect to the calendar year which is the subject of the
Statement to be audited by a certified public accountant mutually acceptable to
Landlord and Tenant. The audit shall take place at the offices of Landlord where
its books and records are located at a mutually convenient time during
Landlord's regular business hours. Tenants Percentage Share of Operating
Expenses shall be appropriately adjusted based upon the results of such audit,
and the results of such audit shall be final and binding upon Landlord and
Tenant. The accountant conducting the audit shall be compensated on an hourly
basis and shall not be compensated based upon a percentage of overcharges it
discovers. No subtenant shall have any right to conduct an audit, and no
assignee shall conduct an audit for any period during which such assignee was
not in possession of the Premises. Tenant's right to undertake an audit with
respect to any calendar year shall expire sixty (60) days after Tenant's receipt
of the Statement for such calendar year, and such Statement shall be final and
binding upon Tenant and shall, as between the parties, be conclusively deemed
correct, at the end of such sixty (60) day period, unless prior thereto Tenant
shall have given Landlord written notice of Its intention to audit Operating
Expenses for the calendar year which is the subject of the Statement. If Tenant
gives Landlord notice of its Intention to audit Operating Expenses, it must
commence such audit within sixty (60) days after such notice Is delivered to
Landlord, and the audit must be completed within one hundred twenty (120) days
after such notice is delivered to Landlord. If Tenant does not commence and
complete the audit within such periods, the Statement which Tenant elected to
audit shall be deemed final and binding upon Tenant and shall, as between the
parties, be conclusively deemed correct. Tenant agrees that the results of any
Operating Expense audit shall be kept strictly confidential by Tenant and shall
not be disclosed to any other person or entity.

         6.6      AMORTIZATION OF CERTAIN IMPROVEMENTS. Pursuant to sections 6.1
and 12 of this Lease, Landlord has the right to require Tenant to pay for
certain costs related to the replacement of the roof membrane and HVAC units at
the Building and the resurfacing of the asphalt and concrete driveways and
parking areas of the Project (collectively, the "Major Items").

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Notwithstanding anything to the contrary contained In sections 6.1 and 12, If
Landlord replaces a Major Item, and in accordance with GAAP, the entire cost of
the replacement is not deductible as an expense in the year incurred, Landlord
shall amortize the cost of the replacement of the Major Item over its useful
life, as reasonably determined by Landlord, and Tenant shall only be obligated
to reimburse Landlord each year for its Percentage Share of such amortized cost.

7.       SECURITY DEPOSIT. Tenant shall deliver to Landlord at the time it
executes this Lease the security deposit set forth in section 1.12 as security
for Tenant's faithful performance of Tenant's obligations hereunder. If Tenant
falls to pay Base Rent or other charges due hereunder, or otherwise defaults
with respect to any provision of this Lease, Landlord may use all or any portion
of said deposit for the payment of any Base Rent or other charge due hereunder,
to pay any other sum to which Landlord may become obligated by reason of
Tenant's default, or to compensate Landlord for any loss or damage which
Landlord may suffer thereby. If Landlord so uses or applies all or any portion
of said deposit, Tenant shall within thirty (30) days after written demand
therefore deposit cash with Landlord in an amount sufficient to restore said
deposit to its full amount. Landlord shall not be required to keep said security
deposit separate from Its general accounts. If Tenant performs all of Tenant's
obligations hereunder, said deposit, or so much thereof as has not heretofore
been applied by Landlord, shall be returned, without payment of interest or
other amount for its use, to Tenant (or, at Landlord's option, to the last
assignee, if any, of Tenant's interest hereunder) within thirty (30) days after
the expiration of the term hereof, or after Tenant has vacated the Premises,
whichever is later. No trust relationship Is created herein between Landlord and
Tenant with respect to said security deposit. Tenant acknowledges that the
security deposit is not an advance payment of any kind or a measure of
Landlord's damages in the event of Tenant's default. To the extent the
provisions of any law are inconsistent with this section, Tenant hereby waives
such inconsistent provisions.

8.       UTILITIES.

         8.1      PAYMENT. Tenant shall pay for all water, gas, electricity,
telephone, sewer, sprinkler services, refuse and trash collection and other
utilities and services used on the Premises, together with any taxes, penalties,
surcharges or the like pertaining thereto. Tenant shall contract directly with
the applicable public utility for such services. Tenant shall pay its share of
all charges for Jointly metered utilities based upon consumption, as reasonably
determined by Landlord.

         8.2      INTERRUPTIONS. Tenant agrees that Landlord Shalt not be liable
to Tenant for its failure to furnish water, gas, electricity, telephone, sewer,
refuse and trash collection or any other utility services or building services
when such failure is occasioned, In whole or in part, by repairs, replacements
or improvements, by any strike, lockout or other labor trouble, by inability to
secure electricity, gas, water, telephone service or other utility at the
Project, by any accident, casualty or event arising from any cause whatsoever,
including the negligence of contractors or by act, negligence or default of
Tenant, and such failures shall never be deemed to constitute an eviction or
disturbance of Tenant's use and possession of the Premises or relieve Tenant
from the obligation of paying rent or performing any of its obligations under
this Lease. Furthermore, Landlord shall not be liable under any circumstances
for loss of property or for injury to, or interference with, Tenant's business,
including, without limitation, loss of profits, however occurring, through or In
connection with or Incidental to a failure per the foregoing to furnish any such
services or utilities. Provided that Landlord first obtains Tenant's consent,
which shall not be unreasonably withheld, Landlord may comply with voluntary
controls or guidelines promulgated by any governmental entity relating to the
use or conservation of energy, water, gas, light or electricity or the reduction
of automobile or other emissions without creating any liability of Landlord to
Tenant under this Lease. In the event there is an interruption in a service
provided by Landlord to Tenant, Landlord shall proceed diligently and in a
commercially reasonable manner to end the interruption.

         8.3      Intentionally deleted.

         8.4.     ALTERNATIVE UTILITY PROVIDERS. If permitted by applicable
laws, and provided service to Tenant is at least equal to the then existing
service and provided Tenant's Share of Operating Expenses is not increased
thereby, Landlord shall have the right at any time and from time to time during
the term of this Lease to either contract for service from a different company
or companies (each such company referred to as an "Alternate Service Provider")
other than the company or companies presently providing electrical service for
the Project (the "Electric Service Provider") or continue to contract for
service from the Electric Service Provider, at Landlord's sole discretion.
Tenant agrees to cooperate with Landlord, the Electric Service Provider, and an
Alternate Service Provider at all times and, as reasonably necessary, shall
allow Landlord, the Electric Service Provider, and any Alternate Service
Provider reasonable access to the Building's electric lines, feeders, risers,
wiring and any other machinery within the Premises.

9.       REAL AND PERSONAL PROPERTY TAXES.

         9.1      PAYMENT OF TAXES. Tenant shall pay to Landlord during the term
of this Lease, in addition to Base Rent and Tenant's Percentage Share of
Operating Expenses, Tenant's Percentage Share of all Real Property Taxes.
Tenant's Percentage Share of Real Property Taxes shall be payable by Tenant at
the same time, in the same manner and under the same terms and conditions as
Tenant pays Tenant's Percentage Share of Operating Expenses.

         9.2      DEFINITION OF REAL PROPERTY TAX. As used herein, the term
"Real Properly Taxes" shall Include any form of real estate tax or assessment,
general, special, ordinary or extraordinary, improvement bond or bonds imposed
on the Project or any portion thereof by any authority having the direct or
indirect power to tax, including any city, county, state or federal government,
or any school, agricultural, sanitary, fire, street, drainage or other
improvement district thereof, as against any legal or equitable interest of
Landlord in the Project or In any portion thereof. Real Property Taxes shall not
Include income, inheritance and gift taxes.

         9.3      PERSONAL PROPERTY TAXES, Tenant shall pay prior to delinquency
all taxes assessed against and levied upon trade fixtures, furnishings,
equipment and all other personal property of Tenant contained in the Premises or
related to Tenant's use of the Premises. If any of Tenant's personal property
shall be assessed with Landlord's real or personal property, Tenant shall pay to
Landlord me taxes attributable to Tenant within ten (10) days after receipt of a
written statement from Landlord setting forth the taxes applicable to Tenant's
property.

         9.4      REASSESSMENTS. From time to time Landlord may challenge the
assessed value of the Project as determined by applicable taxing authorities
and/or Landlord may attempt to cause the Real Property Taxes to be reduced on
other grounds. If Landlord is successful In causing the Real Property Taxes to
be reduced or In obtaining a refund, rebate, credit or similar benefit
(hereinafter collectively referred to as a "reduction"), Landlord shall to the
extent practicable, credit the reductions) to Real Property Taxes for the
calendar year to which a reduction applies and recalculate the Real Property
Taxes owed by Tenant for years in which the reduction applies based on the
reduced Real Property Taxes. All costs incurred by Landlord in obtaining the
Real Property Tax reductions shall be considered an Operating Expense, and
Landlord shall determine, in its sole discretion, to which years any reductions
will be applied. In addition, all accounting and related costs incurred by
Landlord in making the adjustments shall be an Operating Expense. Landlord shall
have the right to compensate

                                       5
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a person or entity it employs to obtain a reduction in Real Property Taxes by
giving such person or entity a percentage of any reduction or credit obtained,
and in this event the reduction or credit obtained by Landlord shall be deemed
to be the reduction or credit given by the taxing authority less the
compensation paid to such person or entity.

10.      INSURANCE.

         10.1     INSURANCE-TENANT.

                  (a)      Tenant shall obtain and keep in force during the
term of this Lease a commercial general liability policy of insurance with
coverages acceptable to Landlord, in Landlord's reasonable discretion, which, by
way of example and not limitation, protects Tenant and Landlord (as an
additional insured) against claims for bodily injury, personal injury and
property damage based upon, involving or arising out of the ownership, use,
occupancy or maintenance of the Premises and all areas appurtenant thereto. Such
insurance shall be on an occurrence basis providing single-limit coverage in an
amount not less than $1,000,000 per occurrence, $3,000,000 for injuries to more
than one person in any one accident and $2,000,000 for property damage per
accident with an "Additional Insured-Managers and Landlords of Premises
Endorsement" and contain the "Amendment of the Pollution Exclusion" for damage
caused by heat, smoke or fames from a hostile fire. The policy shall not contain
any intra-insured exclusions as between Insured persons or organizations, but
shall include coverage for liability assumed under this Lease as an "insured
contract" for the performance of Tenant's indemnity obligations under this
Lease.

                  (b)      Tenant shall obtain and keep in force during the term
of this Lease "all-risk" extended coverage property Insurance with coverages
acceptable to Landlord, in Landlord's reasonable discretion. Said insurance
shall be written on a ninety percent (90%) replacement cost basis on Tenant's
personal property, all tenant improvements installed at the Premises by Landlord
or Tenant, Tenant's trade fixtures and other properly; provided however that all
costs of repair or replacement of Tenant's personal properly as a result of
insuring less than the full replacement cost of the personal property shall be
borne solely by Tenant and shall not be paid by Landlord under any
circumstances. By way of example, and not limitation, such policies shall
provide protection against any peril included within the classification "fire
and extended coverage," against vandalism and malicious mischief, theft and
sprinkler leakage.

                  (c)      Tenant shall, at all times during the term hereof,
maintain in effect workers' compensation insurance as required by applicable law
and business Interruption and extra expense insurance satisfactory to Landlord,
Notwithstanding anything to the contrary contained in this section, Tenant shall
have the right to act as the insurer for purposes of providing the business
interruption insurance described above. Landlord shall not be responsible or
liable to Tenant for any damages or other amounts which would be paid by the
business interruption insurance described above, even If the damages are caused
by Landlord's employees, agents, visitors, Invitees, guests or Independent
contractors (collectively, "Landlord's Associates"), and Tenant hereby releases
Landlord's Associates from any claim, demands, toss, damages, consequential
damages, and the like, resulting from damage or liability that would be covered
by such business interruption Insurance. If Tenant assigns this Lease, the
assignee shall not have the right to provide self-Insurance for business
Interruption Insurance unless the assignee is an Affiliate (as defined below).

      10.2   INSURANCE-LANDLORD.

                  (a)      Landlord shall obtain and keep in force a policy of
general liability Insurance with coverage against such risks and in such amounts
as are commercially reasonable insuring Landlord against liability arising out
of the ownership, operation and management of the Project.

                  (b)      Landlord shall also obtain and keep in force during
the term of this Lease a policy or policies of insurance covering loss or damage
to the Project in the amount of not less than eighty percent (80%) of the full
replacement cost thereof, as determined by Landlord from time to time, provided
however that all costs of repair or replacement for the Project payable by
Landlord as a result of Insuring less than the full replacement cost of the
Project (except for any Insurance deductible expressly permitted by section 6.2
below) shall be borne solely by Landlord and shall In no event be passed on to
Tenant as an Operating Expense or Capital Improvement. The terms and conditions
of said policies and the perils and risks covered thereby shall be determined by
Landlord, from time to time, in Landlord's sole discretion. In addition, at
Landlord's option, Landlord shall obtain and keep in force, during the term of
(his Lease, a policy of rental interruption insurance, with loss payable to
Landlord, which Insurance shall, at Landlord's option, also cover all Operating
Expenses and Real Property Taxes. Tenant will not be named as an additional
insured in any Insurance policies carried by Landlord and shall have no right to
any proceeds therefrom. The policies purchased by Landlord shall contain such
deductibles as Landlord may determine and as are commercially reasonable. Tenant
shall pay at Tenant's sole expense any increase in the property insurance
premiums for the Project over what was payable immediately prior to the increase
to the extent the increase Is specified by Landlord's insurance carrier as being
caused by the nature of Tenant's occupancy or any act or omission of Tenant.

         10.3     INSURANCE POLICIES. Unless Tenant has already done so, Tenant
shall deliver to Landlord certificates of the insurance policies required under
section 10.1 within fifteen (15) days prior to the Commencement Date of this
Lease. Tenant's insurance policies shall not be cancelable except after thirty
(30) days prior written notice to Landlord. Tenant shall, at least ten (10) days
prior to the expiration of such policies, furnish Landlord with renewals
thereof. Tenant's Insurance policies shall be issued by insurance companies
authorized to do business in the state in which the Premises is located, and
said companies shall maintain during the policy term a "General Pollcyholder's
Rating" of at least A and a financial rating of at least "Class X" (or such
other rating as may be required by any lender having a lien on the Premises) as
set forth in the most recent edition of "Best Insurance Reports." All insurance
obtained by Tenant shall be primary to and not contributory with any similar
insurance carried by Landlord, whose insurance shall be considered excess
insurance only. Landlord and, at Landlord's option, the holder of any mortgage
or deed of trust encumbering the Project and any person or entity managing the
Project on behalf of Landlord, shall be named as an additional insured on all
insurance policies Tenant is obligated to obtain by section 10.1 above. Tenant
shall use commercially reasonable efforts to maintain deductibles of less than
One Hundred Thousand Dollars ($100,000), with the exception of the perils of
earthquake and flood, which are subject to commercially available terms.

         10.4     WAIVER OF SUBROGATION. Landlord and Tenant hereby release
each other from any claims and demands of whatever nature for damage, loss or
injury to the Premises and/or the Project, or to the other's property in, on or
about the Premises and the Project, that are caused by or result from risks or
perils insured against under any property insurance policies required by this
Lease to be carried by Landlord and/or Tenant whether or not in force at the
time of any such damage, loss or injury. Landlord and Tenant shall cause each
Insurance policy obtained by them to provide that the insurance company waives
all right of recovery by way of subrogation against either Landlord or Tenant in
connection with any damage covered by any such policy or policies.

                                       6
<PAGE>

         10.5     COVERAGE.. Landlord makes no representation to Tenant that the
limits or forms of coverage specified above or approved by Landlord are adequate
to insure Tenant's property or Tenant's obligations under this Lease.

11.      LANDLORD'S REPAIRS.

         11.1     LANDLORD'S SOLE EXPENSE. Landlord shall maintain, at
Landlord's expense (and shall not include In Operating Expenses), only the
structural elements of the roof of the Building (excluding the roof membrane),
the structural soundness of the foundation of the Building and the structural
elements of the exterior walls of the Building and the structural elements of
existing interior load bearing walls of the Building (excluding any load bearing
walls constructed by Tenant, which Tenant shall maintain and repair at Tenant's
sole expense). Tenant shall reimburse Landlord for the cost of any maintenance,
repair or replacement of the foregoing necessitated by Tenant's misuse,
negligence, alterations to the Premises or any breach of its obligations under
this Lease. By way of example, and not limitation, the term "EXTERIOR WALLS" as
used in this section shall not include windows, glass or plate glass, doors or
overhead doors, special store fronts, dock bumpers, dock plates or levelers, or
office entries unless damage to the foregoing is caused by foundation settlement
or failure of the structural elements of the Building and such settlement or
failure is not caused by Tenant. Tenant shall Immediately give Landlord written
notice of any repair required by Landlord pursuant to this section, after which
Landlord shall have a reasonable time in which to complete the repair. Nothing
contained in this section shall be construed to obligate Landlord to seal or
otherwise maintain the surface of any foundation, floor or slab. Tenant
expressly waives the benefits of any statute now or hereafter in effect which
would otherwise afford Tenant the right to make repairs at Landlord's expense or
to terminate this Lease because of Landlord's failure to Keep the Premises in
good order, condition and repair.

         11.2     LANDLORD REPAIRS INCLUDED IN OPERATING EXPENSES. Landlord
shall employ contractors to perform all repairs, maintenance and replacements of
the roof membranes, heating, ventilation and air conditioning ("HVAC") units
(see section 12.2 below), parking areas, landscaped areas and exterior walls of
the Premises. The Items described in the previous sentence that Landlord will
cause to be repaired, maintained and replaced are hereinafter referred to as the
"LANDLORD MAINTENANCE ITEMS." Landlord's maintenance of the exterior walls of
the Premises shall include the right, but not the obligation, of Landlord to
paint from time to time all or some of the exterior walls, canopies, doors,
windows, gutters, handrails and other exterior parts of the Premises with colors
selected by Landlord. Tenant shall immediately give Landlord written notice of
any repair or maintenance required by Landlord pursuant to this section, after
which Landlord shall have a reasonable time in which to complete such repair or
maintenance. Landlord shall use commercially reasonable efforts to minimize
disruption to Tenant's business operations caused by the performance of Landlord
Maintenance Items provided, however, that Landlord shall not be obligated to
Incur additional costs in connection with such efforts. Subject to the
limitations set forth in section 6 of this lease, Landlord shall include the
cost of Landlord Maintenance Items in Operating Expenses, and Tenant shall then
pay Tenant's Percentage Share of such costs.

         11.3     PERFORMANCE OF LANDLORD REPAIRS BY TENANT. If Landlord
defaults in the performance of Its obligations under sections 11.1 and 11.2
(Landlord shall not be In default until it has been given notice of default as
required by section 17.3 and has failed to cure the default during the
applicable cure period set forth in section 17.3), then Tenant may proceed to
perform such obligations upon delivery of an additional ten (10) business days
advance written notice to Landlord specifying that Tenant intends to perform
such obligations, and Tenant shall be entitled to prompt reimbursement by
Landlord of Tenant's reasonable costs and expenses in taking such action. Tenant
shall not be entitled to reimbursement until Tenant has provided Landlord with
reasonable documentation that it has paid for a repair and/or maintenance
Landlord was obligated to perform pursuant to sections 11.1 or 11.2 and has
provided Landlord with valid mechanic's lien releases. In the event Tenant takes
such action, Tenant shall use only those contractors used by Landlord in the
Building for similar work unless such contractors are unwilling or unable to
perform such work in a timely manner at reasonably competitive rates (vis-a-vis
other qualified contractors), in which event Tenant may utilize the services of
any other qualified contractor which normally and regularly performs similar
work in the comparable buildings. Tenant shall require the contractors to
provide evidence of commercially reasonable insurance coverage before performing
any maintenance and/or repair, and shall ensure that Landlord is named as an
additional insured on such Insurance policy(s). Further, if Landlord does not
deliver a detailed written objection to Tenant within thirty (30) days after
receipt of an invoice by Tenant of its costs of taking action which Tenant
claims should have been taken by Landlord, and if such invoice from Tenant sets
forth a reasonably particularized breakdown of its costs and expenses in
connection with taking such action on behalf of Landlord, then Tenant shall be
entitled to deduct from Base Rent payable by Tenant under this Lease, the amount
set forth in such invoice. If, however, Landlord delivers to Tenant within
thirty (30) days after receipt of Tenant's invoice, a written objection to the
payment of such invoice, setting forth with reasonable particularity Landlord's
reasons for its claim that such action did not have to be taken by Landlord
pursuant to the terms of this Lease or that the charges are excessive (in which
case Landlord shall pay the amount it contends would not have been excessive),
then Tenant shall not be entitled to such deduction from Base Rent, but as
Tenant's sole remedy, Tenant may proceed to claim a default by Landlord under
this Lease. For purposes of the foregoing, in order for charges to be deemed
excessive Landlord must provide (i) supporting documentation from an Independent
qualified contractor property licensed, insured and doing business in the city
In which the Premises are located, and (II) such alternate price submitted and
so documented by Landlord must be at least ten (10%) percent less than the cost
claimed by Tenant

12.      TENANT'S REPAIRS.

         12.1     OBLIGATIONS of TENANT. Tenant shall, at Its sole cost and
expense, keep and maintain all parts of the Premises (except those listed as
Landlord's responsibility In section 11 above) in good and sanitary condition,
promptly making all necessary repairs and replacements, including but not
limited to, windows, glass and plate glass, doors, skylights, any special store
front or office entry, walls and finish work, floors and floor coverings, dock
boards, bumpers, plates, seals, levelers and lights, plumbing work and fixtures
(Including periodic backflow testing), electrical systems, lighting facilities
and bulbs, sprinkler systems, alarm systems, fire detection systems, termite and
pest extermination, fencing, tenant signage and regular removal of trash and
debris. Tenant shall notify Landlord In writing prior to making any repair or
performing any maintenance pursuant to this section if such repair or
maintenance is material in nature, would affect the general appearance or
functionality of the Building or Its systems or If notice to Landlord is
required pursuant to section 13.1. Landlord shall have the right to designate
the contractor Tenant shall use to make any repair or to perform any maintenance
on the, plumbing systems, electrical systems, sprinkler systems, fire alarm
systems or fire detection systems located at the Premises. Tenant shall not
paint or otherwise change the exterior appearance of the Premises without
Landlord's prior written consent, which may be given or withheld in Landlord's
sole discretion. The cost of maintenance and repair of any common party wall
(any wall, divider, partition or any other structure separating the Premises
from any adjacent premises occupied by other tenants) shall be shared equally by
Tenant and the tenant occupying the adjacent premises; provided, however, If
Tenant damages a party wall the entire cost of the repair shall be paid by
Tenant, at Tenant's sole expense. Tenant shall not damage any party wall or
disturb the integrity and support provided by any party wall. If Tenant fails to
keep the Premises In good condition and repair, Landlord may, but shall not be
obligated to, make any necessary repairs. If Landlord makes such repairs,
Landlord may bill Tenant for the cost of the repairs as additional rent, and
said additional rent shall be payable by Tenant within thirty (30) days after
demand by Landlord.

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<PAGE>

         12.2     HVAC MAINTENANCE. Notwithstanding Landlord's obligation to
maintain, repair and replace the HVAC units pursuant to section 11.2, subject to
the limitations set forth below, Tenant shall maintain and repair, but not
replace, the HVAC units servicing the Premises. In the event an HVAC unit needs
to be replaced, as reasonably determined by Landlord, Landlord shall replace the
HVAC unit In accordance with section 11.2 above. While Tenant is responsible for
the maintenance and repair of the HVAC units, Tenant, not Landlord, shall enter
into a regularly scheduled preventative maintenance/service contract (the "HVAC
Contract") for the HVAC units servicing the Premises, and the terms and
conditions of the HVAC Contract shall be acceptable to Landlord, In Landlord's
reasonable discretion. At Landlord's request, Tenant shall provide Landlord with
a copy of the HVAC Contract Tenant shall pay all costs ft incurs in maintaining
and repairing the HVAC units and in purchasing the Maintenance Contract at
Tenant's sole cost and expense, and Landlord shall have no obligation to
reimburse Tenant for any of such costs. If Tenant falls to maintain and repair
the HVAC units in a commercially reasonable manner, Landlord shall have the
right to elect to (a) maintain and repair the HVAC units pursuant to section
11.2 and (b) obtain the HVAC maintenance contract pursuant to section 12.3.

         12.3     MAINTENANCE CONTRACTS. Landlord shall enter into regularly
scheduled preventative maintenance/service contracts for some or all of the
following: the HVAC units servicing the Premises (see section 12.2) and for the
roof membrane of the Premises (the "Maintenance Contracts"). The Maintenance
Contracts shall include maintenance services satisfactory to Landlord, in
Landlord's sole discretion. Landlord shall include the cost of Maintenance
Contracts in Operating Expenses, and Tenant shall then pay Tenant's Percentage
Share of such costs as determined by Landlord.

13.      ALTERATIONS AND SURRENDER.

         13.1     CONSENT OF LANDLORD. Tenant shall have the right, subject to
Landlord's reasonable requirements relating to construction at the Project, upon
ten (10) days prior written notice to Landlord, to make alterations ("Permitted
Alterations") to the Inside of the Premises (e.g., paint and carpet,
communication systems, telephone and computer system wiring) that do not (i)
Involve the expenditure of more than $25,000.00; (ii) affect the exterior
appearance of the Building or the roof, (HI) affect the Building's electrical,
plumbing, HVAC, life, fire safety or similar Building systems or the structural
elements of the Building, (iv) affect the Common Areas or parking areas or (v)
materially adversely affect any other tenant of the Project Except with respect
to Permitted Alterations, Tenant shall not, without Landlord's prior written
consent, which may be given or withheld in Landlord's reasonable discretion,
make any alterations, Improvements, additions, utility installations or repairs
(hereinafter collectively referred to as "Non-Permitted Alterations") In, on or
about the Premises or the Project; provided, however, Landlord shall have no
obligation to consent to any structural alteration to the Building or a
modification of any building system that would adversely affect the operation of
the building system. References In this Lease to 'Alterations" shall mean both
Permitted Alterations and Non-Permitted Alterations. At the expiration of the
term, Landlord may require the removal of any Alterations installed by Tenant
and the restoration of the Premises and the Project to their prior condition, at
Tenant's expense if, at the time of Landlord's consent, Landlord did not agree
In writing that Tenant would not be obligated to remove! the Alterations. Tenant
shall not be obligated to remove the improvements located in the Premises as of
the date of this Lease. If, as a result of any Alteration made by Tenant,
Landlord Is obligated to comply with the Americans With Disabilities Act or any
other law or regulation, and such compliance requires Landlord to make any
improvement or Alteration to any portion of the Project, as a condition to
Landlord's consent, Landlord shall have the right to require Tenant to pay to
Landlord prior to the construction of any Alteration by Tenant the entire cost
of any improvement or alteration Landlord is obligated to complete by such law
or regulation. Should Landlord permit Tenant to make its own Alterations, Tenant
shall use only such architect and contractor as has been expressly approved by
Landlord, In Landlord's reasonable discretion, and, If the Alteration will cost
more than $100,000 to complete, Landlord may require Tenant to provide to
Landlord, at Tenant's sole cost and expense, a lien and completion bond in an
amount equal to the estimated cost of such Alterations, to Insure Landlord
against any liability for mechanic's and materialmen's liens and to insure
completion of the work. In addition, in order to compensate Landlord for the
overhead and other costs It Incurs In reviewing the plans for the Alterations
and in monitoring the construction of the Alterations, Tenant shall pay to
Landlord a fee equal to the actual out-of-pocket costs incurred by Landlord In
reviewing and monitoring the construction of the Alterations, If any; provided,
however, in no event shall Tenant be obligated to reimburse Landlord for
out-of-pocket costs In excess of four percent (4%) of the cost of the
Alterations. Should Tenant make any Alterations without the prior approval of
Landlord, or use a contractor not expressly approved by Landlord, Landlord may,
at any time during the term of this Lease, require that Tenant remove all or
part of the Alterations and return the Premises to the condition it was In prior
to the making of the Alternations. In the event Tenant makes any Alterations,
and conditions warrant (in Landlord's discretion), Landlord may require Tenant
to obtain or cause its contractor to obtain, prior to the commencement of any
work, "builders all risk" Insurance In an amount approved by Landlord, workers
compensation insurance and any other insurance requested by Landlord, in
Landlord's sole discretion.

         13.2     PERMITS. Any Alterations in or about the Premises that Tenant
shall desire to make shall be presented to Landlord in written form, with plans
and specifications which are sufficiently detailed to obtain a building permit
If Landlord consents to an Alteration, the consent shall be deemed conditioned
upon Tenant acquiring a building permit from the applicable governmental
agencies, furnishing a copy thereof to Landlord prior to the commencement of the
work, and compliance by Tenant with all conditions of said permit in a prompt
and expeditious manner. Tenant shall provide Landlord with as-built plans and
specifications for any Alterations made to the Premises If such Alterations
required a building permit.

         13.3     MECHANICS LIENS. Tenant shall pay, when due, all claims for
labor or materials furnished or alleged to have been furnished to or for Tenant
at or for use In the Premises, which claims are or may be secured by any
mechanic's or materialmen's lien against the Premises or the Project, or any
Interest therein. If Tenant shall, in good faith, contest the validity of any
such lien, Tenant shall furnish to Landlord a surety bond satisfactory to
Landlord In an amount equal to not less than one and one-half times the amount
of such contested lien daim indemnifying Landlord against liability arising out
of such lien or claim. Such bond shall be sufficient in form and amount to free
the Project from the effect of such lien. In addition, Landlord may require
Tenant to pay Landlord's reasonable attorneys' fees and costs in participating
in such action.

         13.4     NOTICE. Tenant shall give Landlord not less than ten (10)
days' advance written notice prior to the commencement of any work in the
Premises by Tenant, and Landlord shall have the right to post notices of
non-responsibility in or on the Premises or the Project.

         13.5     SURRENDER. Subject to Landlord's right to require removal or
to elect ownership as hereinafter provided, all Alterations made by Tenant to
the Premises shall be the property of Tenant, but shall be considered to be a
part of the Premises. Unless Landlord gives Tenant written notice of its
election not to become the owner of the Alterations at the end of the term of
this Lease, the Alterations shall become the property of Landlord at the end of
the term of this Lease. Landlord may require, on notice to Tenant, that some or
all Alterations be removed prior to the end of the term of this Lease and that
any damages caused by such removal be repaired at Tenant's sole expense. On the
last day of the term hereof, or on any sooner termination, Tenant shall
surrender the Premises (including, but not limited to, all doors, windows,
floors and floor coverings, skylights, heating and air conditioning systems,
dock boards, truck doors, dock bumpers, plumbing work and fixtures, electrical
systems, lighting facilities, sprinkler systems, fire detection systems and
nonstructural elements of the exterior walls, foundation and roof (collectively
the "Elements of the Premises')) to Landlord in the same condition as

                                       8
<PAGE>

received, ordinary wear and tear and casualty damage excepted, clean and free of
debris and Tenant's personal property, trade fixtures and equipment Tenant's
personal property shall Include Its trade fixtures and equipment, furnishings,
office equipment, furniture, communication/telephone devices, computers (and all
related equipment) and all computer wiring and cabling installed by Tenant.
Provided, however, if Landlord has not elected to have Tenant remove the
Alterations, Tenant shall leave the Alterations at the Premises in good
condition and repair, ordinary wear and tear excepted. Tenant shall repair any
damage to the Premises occasioned by the installation or removal of Tenant's
trade fixtures, furnishings and equipment Damage to or deterioration of any
Element of the Premises or any other item Tenant is required to repair or
maintain at the Premises shall not be deemed ordinary wear and tear if the same
could have been prevented by good maintenance practices. If the Premises are not
surrendered at the expiration of the term or earlier termination of this Lease
in accordance with the provisions of this section, at Landlord's option, Tenant
shall continue to be responsible for the payment of Base Rent and all other
amounts due under this Lease until the Premises are so surrendered in accordance
with said provisions. Tenant shall Indemnify, defend and hold Landlord harmless
from and against any and all damages, expenses, costs, losses or liabilities
arising from any delay by Tenant in so surrendering the Premises Including,
without limitation, any damages, expenses, costs, losses or liabilities arising
from any claim against Landlord made by any succeeding tenant or prospective
tenant founded on or resulting from such delay and losses and damages suffered
by Landlord due to lost opportunities to lease any portion of the Premises to
any such succeeding tenant or prospective tenant, together with, in each ease,
actual attorneys' fees and costs.

         13.6     FAILURE OF TENANT TO REMOVE PROPERTY. If this Lease is
terminated due to the expiration of its term or otherwise, and Tenant falls to
remove Its property, in addition to any other remedies available to Landlord
under this Lease, and subject to any other right or remedy Landlord may have
under applicable law, Landlord may remove any property of Tenant from the
Premises and store the same elsewhere at the expense and risk of Tenant.

14.      DAMAGE AND DESTRUCTION.

         14.1     EFFECT OF DAMAGE OR DESTRUCTION. If all or part of the Project
is damaged by fire, earthquake, flood, explosion, the elements, riot, the
release or existence of Hazardous Materials (as defined below) or by any other
cause whatsoever (hereinafter collectively referred to as "damages"), but the
damages are not material (as defined in section 14.2 below), Landlord shall
repair the damages to the Project as soon as is reasonably possible, and this
Lease shall remain in full force and effect, if all or part of the Project Is
destroyed or materially damaged (as defined in section 14.2 below), Landlord
shall have the right, In Its sole and complete discretion, to repair or to
rebuild the Project or to terminate this Lease. Landlord shall within ninety
(90) days after the discovery of such material damage or destruction notify
Tenant in writing of Landlord's intention to repair or to rebuild or to
terminate this Lease. Tenant shall In no event be entitled to compensation or
damages on account of annoyance or inconvenience in making any repairs, or on
account of construction, or on account of Landlord's election to terminate this
Lease. Notwithstanding the foregoing, If Landlord shall elect to rebuild or
repair the Project after damage or destruction, but In good faith determines
that the Premises cannot be substantially repaired within one hundred eighty
(180) days after the date of the discovery of the damage or destruction, without
payment of overtime or other premiums, and the damage to the Project will render
the entire Premises unusable during said one hundred eighty (180) day period,
Landlord shall notify Tenant thereof in writing at the time of Landlord's
election to rebuild or repair, and Tenant shall thereafter have a period of
thirty (30) days within which Tenant may elect to terminate this Lease, upon
thirty (30) days' advance written notice to Landlord. Tenant's termination right
described in the preceding sentence shall not apply if the damage was caused by
the negligent or intentional acts of Tenant or its employees, agents,
contractors or invitees. Failure of Tenant to exercise said election within said
thirty (30) day period shall constitute Tenant's agreement to accept delivery of
the Premises under this Lease whenever tendered by Landlord, provided Landlord
thereafter pursues reconstruction or restoration diligently to completion,
subject to delays caused by Force Majeure Events. A "Force Majeure Event" shall
mean fire, earthquake, weather delays or other acts of God, strikes, boycotts,
war, riot, insurrection, embargoes, shortages of equipment, labor or materials,
delays In Issuance of governmental permits or approvals, or any other cause
beyond the reasonable control of Landlord. If Landlord is unable to repair the
damage to the Premises or the Project during such one hundred eighty (180) day
period due to Force Majeure Events, the one hundred eighty (180) day period
shall be extended by the period of delay caused by the Force Majeure Events.
Subject to section 14.3 below, if Landlord or Tenant terminates this Lease in
accordance with this section 14.1, Tenant shell continue to pay all Base Rent,
Operating Expenses and other amounts due hereunder which arise prior to the date
of termination.

         14.2     DEFINITION OF MATERIAL DAMAGE. Damage to the Project shall be
deemed material if, in Landlord's reasonable judgment, the uninsured cost of
repairing the damage will exceed One Hundred Thousand Dollars ($100,000). If
insurance proceeds are available to Landlord in an amount which is sufficient to
pay the entire cost of repairing all of the damage to the Project, the damage
shall be deemed material if the cost of repairing the damage exceeds Three
Hundred Thousand Dollars ($300,000). Damage to the Project shall also be deemed
material if (a) the Project cannot be rebuilt or repaired to substantially the
same condition it was In prior to the damage due to laws or regulations in
effect at the time the repairs will be made, (b) the holder of any mortgage or
deed of trust encumbering the Project requires that insurance proceeds available
to repair the damage in excess of One Hundred Thousand Dollars ($100,000) be
applied to the repayment of the indebtedness secured by the mortgage or the deed
of trust, or (c) the damage occurs during the last twelve (12) months of the
Lease term.

       14.3      ABATEMENT OF RENT. If Landlord elects to repair damage to the
Project and all or part of the Premises will be unusable or inaccessible to
Tenant in the ordinary conduct of Its business until the damage is repaired, and
the damage was not caused by the negligence or intentional acts of Tenant or its
employees, agents, contractors or invitees, Tenant's Base Rent and Tenant's
Share of Operating Expenses shall be abated until the repairs are completed in
proportion to the amount of the Premises which is unusable or inaccessible to
Tenant In the ordinary conduct of its business. Notwithstanding the foregoing,
there shall be no abatement of Base Rent or Tenant's Share of Operating Expenses
by reason of any portion of the Premises being unusable or inaccessible for a
period equal to five (5) consecutive business days or less.

      14.4       TENANT'S ACTS. If such damage or destruction occurs as a result
of the negligence or the Intentional acts of Tenant or Tenant's employees,
agents, contractors or invitees, and the proceeds of insurance which are
actually received by Landlord are not sufficient to pay for the repair of all of
the damage, Tenant shall pay, at Tenant's sole cost and expense, to Landlord
upon demand, the difference between the cost of repairing the damage and the
insurance proceeds received by Landlord.

         14.5     TENANT'S PROPERTY. Landlord shall not be liable to Tenant or
its employees, agents, contractors, invitees or customers for loss or damage to
merchandise, tenant Improvements, fixtures, automobiles, furniture, equipment,
computers, files or other property (hereinafter collectively "Tenant's
property") located at the Project. Tenant shall repair or replace all of
Tenant's property at Tenant's sole cost and expense. Tenant acknowledges that It
is Tenant's sole responsibility to obtain adequate insurance coverage to
compensate Tenant for damage to Tenant's property.

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         14.6     WAIVER. Landlord and Tenant hereby waive the provisions of any
present or future statutes which relate to the termination of leases when leased
property Is damaged or destroyed and agree that such event shall be governed by
the terms of this Lease.

15.      CONDEMNATION. If any portion of the Premises or the Project are taken
under the power of eminent domain, or sold under the threat of the exercise of
said power (all of which are herein called "condemnation"), this Lease shall
terminate as to the part so taken as of the date the condemning authority takes
title or possession, whichever first occurs; provided that if so much of the
Premises or Project are taken by such condemnation as would substantially and
adversely affect the operation and profitability of Tenant's business conducted
from the Premises, and said taking lasts for ninety (90) days or more, Tenant
shall have the option, to be exercised only In writing within thirty (30) days
after Landlord shall have given Tenant written notice of such taking (or in the
absence of such notice, within thirty (30) days after the condemning authority
shall have taken possession), to terminate this Lease as of the date the
condemning authority takes such possession. If a taking lasts for less than
ninety (90) days, Tenant's rent and Operating Expenses shall be abated during
said period but Tenant shall not have the right to terminate this Lease. If
Tenant does not terminate this Lease In accordance with the foregoing, this
Lease shall remain in full force and effect as to the portion of the Premises
remaining, except that the Base Rent and Operating Expenses shall be reduced in
the proportion that the usable floor area of the Premises taken bears to the
total usable floor area of the Premises. Common Areas taken shall be excluded
from the Common Areas usable by Tenant and no reduction of rent shall occur with
respect thereto or by reason thereof. Landlord shall have the option in its sole
discretion to terminate this Lease as of the taking of possession by the
condemning authority, by giving written notice to Tenant of such election within
thirty (30) days after receipt of notice of a taking by condemnation of any part
of the Premises or the Project. Any award for the taking of all or any part of
the Premises or the Project under the power of eminent domain or any payment
made under threat of the exercise of such power shall be the property of
Landlord, whether such award shall be made as compensation for diminution in
value of the leasehold, for good will, for the taking of the fee, as severance
damages, or as damages for tenant improvements paid for by Landlord; provided,
however, that Tenant shall be entitled to any separate award for toss of or
damage to Tenant's removable personal property, for moving expenses and for loss
of tenant improvements separately paid for by Tenant, in the event that this
Lease is not terminated by reason of such condemnation, and subject to the
requirements of any lender that has made a loan to Landlord encumbering the
Project, Landlord shall to the extent of severance damages received by Landlord
in connection with such condemnation, repair any damage to the Project caused by
such condemnation except to the extent that Tenant has been reimbursed therefor
by the condemning authority.

16.      ASSIGNMENT AND SUBLETTING.

         16.1     LANDLORD'S CONSENT REQUIRED. Tenant shall not voluntarily or
by operation of law assign, transfer, hypothecate, mortgage, sublet, or
otherwise transfer or encumber all or any part of Tenant's interest in this
Lease or in the Premises (hereinafter collectively a Transfer"), without
Landlord's prior written consent, which shall not be unreasonably withheld.
Landlord shall respond to Tenant's written request for consent hereunder within
thirty (30) days after Landlord's receipt of the written request from Tenant.
Any attempted Transfer without such consent shall be void and shall constitute a
material default and breach of this Lease. Tenant's written request for
Landlord's consent shall Include, and Landlord's thirty (30) day response period
referred to above shall not commence, unless and until Landlord has received
from Tenant, all of the following information; (a) financial statements for the
proposed assignee or subtenant for the past three (3) years prepared in
accordance with generally accepted accounting principles, (b) federal tax
returns for the proposed assignee or subtenant for the past three (3) years, (c)
a TRW credit report or similar report on the proposed assignee or subtenant, (d)
a detailed description of the business the assignee or subtenant intends to
operate at the Premises, (e) the proposed effective date of the assignment or
sublease, (f) a copy of the proposed sublease or assignment agreement which
includes all of the terms and conditions of the proposed assignment or sublease,
(g) a detailed description of any ownership or commercial relationship between
Tenant and the proposed assignee or subtenant, (h) a detailed description of any
Alterations the proposed assignee or subtenant desires to make to the Premises,
and (i) a Hazardous Materials Disclosure Certificate substantially In the form
of Exhibit D attached hereto (the Transferee HazMat Certificate"). If the
obligations of the proposed assignee or subtenant will be guaranteed by any
person or entity, Tenant's written request shall not be considered complete
until the information described in (a), (b) and (c) of the previous sentence has
been provided with respect to each proposed guarantor. Transfer" shall also
include the transfer (a) if Tenant Is a corporation, and Tenant's stock is not
publicly traded over a recognized securities exchange, of more than fifty
percent (50%) of the voting stock of such corporation during the term of this
Lease (whether or not in one or more transfers) or the dissolution, merger or
liquidation of the corporation, or (b) If Tenant is a partnership, limited
liability company, limited liability partnership or other entity, of more than
fifty percent (50%) of the profit and loss participation in such partnership or
entity during the term of this Lease (whether or not in one or more transfers)
or the dissolution, merger or liquidation of the partnership, limited liability
company, limited liability partnership or other entity. If Landlord shall
exercise any option to recapture the Premises, or shall deny a request for
consent to a proposed assignment or sublease, Tenant shall Indemnify, defend and
hold Landlord harmless from and against any and all losses, liabilities,
damages, costs and claims that may be made against Landlord by the proposed
assignee or subtenant, or by any brokers or other persons claiming a commission
or similar compensation In connection with the proposed assignment or sublease.

         16.2     Intentionally deleted.

         16.3     STANDARD FOR APPROVAL. Landlord shall not unreasonably
withhold its consent to a Transfer provided that Tenant has complied with each
and every requirement, term and condition of this section 16. Tenant
acknowledges and agrees that each requirement, term and condition in this
section 16 Is a reasonable requirement, term or condition. It shall be deemed
reasonable for Landlord to withhold its consent to a Transfer if any
requirement, term or condition of this section 16 is not complied with or: (a)
the Transfer would cause Landlord to be in violation of its obligations under
another lease or agreement to which Landlord is a party; (b) in Landlord's
reasonable judgment, a proposed assignee or subtenant is less able financially
to pay the rents due under this Lease as and when they are due and payable; (c)
a proposed assignee's or subtenant's business will impose a burden on the
Project's parking facilities, Common Areas or utilities that Is greater than the
burden imposed by Tenant, in Landlord's reasonable judgment; (d) the terms of a
proposed assignment or subletting will allow the proposed assignee or subtenant
to exercise a right of renewal, right of expansion, right of first offer, right
of first refusal or similar right held by Tenant; (e) a proposed assignee or
subtenant refuses to enter Into a written assignment agreement or sublease,
reasonably satisfactory to Landlord, which provides that It will abide by and
assume all of the terms and conditions of this Lease for the term of any
assignment or sublease and containing such other terms and conditions as
Landlord reasonably deems necessary; (f) the use of the Premises by the proposed
assignee or subtenant will not be a use permitted by this Lease; (g) any
guarantor of this Lease refuses to consent to the Transfer or to execute a
written agreement reaffirming the guaranty; (h) Tenant is In default as defined
In section 17 at the time of the request; (i) If requested by Landlord, the
assignee or subtenant refuses to sign a non-disturbance and attornment agreement
in favor of Landlord's lender (j) Landlord has sued or been sued by the proposed
assignee or subtenant or has otherwise been Involved in a legal dispute with the
proposed assignee or subtenant; (k) the assignee or subtenant Is involved In a
business which is not in keeping with the then-current standards of the Project;
(I) the proposed assignee or subtenant is an existing tenant of the

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Project or is a person or entity then negotiating with Landlord for the lease of
space in the Project; (m) the assignment or sublease will result in there being
more than one subtenant of the Premises; (n) the assignee or subtenant will use,
store or handle Hazardous Materials in or about the Premises of a type, nature,
quantity not in compliance with the terms of this Lease.

         16.4     ADDITIONAL TERMS AND CONDITIONS. The following terms and
conditions shall be applicable to any Transfer:

                  (a)      Regardless of Landlord's consent, no Transfer shall
release Tenant from Tenant's obligations hereunder or alter the primary
liability of Tenant to pay the rent and other sums due Landlord hereunder and to
perform all other obligations to be performed by Tenant hereunder or release any
guarantor from its obligations under its guaranty.

                  (b)      Landlord may accept rent from any person other than
Tenant pending approval or disapproval of an assignment or subletting.

                  (c)      Neither a delay in the approval or disapproval of a
Transfer, nor the acceptance of rent, shall constitute a waiver or estoppel of
Landlord's right to exercise its rights and remedies for the breach of any of
the terms or conditions of this section 16.

                  (d)      The consent by Landlord to any Transfer shall not
constitute a consent to any subsequent Transfer by Tenant or to any subsequent
or successive Transfer by an assignee or subtenant.

                  (e)      In the event of any default under this Lease,
Landlord may proceed directly against Tenant, any guarantors or anyone else
responsible for the performance of this Lease, including any subtenant or
assignee, without first exhausting Landlord's remedies against any other person
or entity responsible therefor to Landlord, or any security held by Landlord.

                  (f)       Landlord's written consent to any Transfer by Tenant
shall not constitute an acknowledgment that no default then exists under this
Lease nor shall such consent be deemed a waiver of any then-existing default.

                  (g)      The discovery of the fact that any financial
statement relied upon by Landlord in giving its consent to an assignment or
subletting was materially false shall, at Landlord's election, render Landlord's
consent null and void.

                  (h)      Landlord shall not be liable under this Lease or
under any sublease to any subtenant.

                  (i)      No assignment or sublease may be modified or amended
without Landlord's prior written consent.

                  (j)      Intentionally deleted.

                  (k)      Any assignee of, or subtenant under, this Lease
shall, by reason of accepting such assignment or entering into such sublease, be
deemed, for the benefit of Landlord, to have assumed and agreed to conform and
comply with each and every term, covenant, condition and obligation herein to be
observed or performed by Tenant during the term of said assignment or sublease,
other than such obligations as are contrary or inconsistent with provisions of
an assignment or sublease to which Landlord has specifically consented in
writing.

                  (l)      At Landlord's request, Tenant shall deliver to
Landlord, Landlord's standard consent to assignment or consent to sublease
agreement, as applicable, executed by Tenant, the assignee and the subtenant, as
applicable.

         16.5     ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO SUBLETTING. The
following terms and conditions shall apply to any subletting by Tenant of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:

                  (a)      Tenant hereby absolutely and unconditionally assigns
and transfers to Landlord all of Tenant's interest in all rentals and income
arising from any sublease entered Into by Tenant, and Landlord may collect such
rent and income and apply same toward Tenant's obligations under this Lease;
provided, however, that until a default shall occur in the performance of
Tenant's obligations under this Lease that is not remedied by Tenant within the
applicable cure period, Tenant may receive, collect and enjoy the rents accruing
under such sublease. Landlord shall not, by reason of this or any other
assignment of such rents to Landlord nor by reason of the collection of the
rents from a subtenant, be deemed to have assumed or recognized any sublease or
to be liable to the subtenant for any failure of Tenant to perform and comply
with any of Tenant's obligations to such subtenant under such sublease,
including, but not limited to, Tenant's obligation to return any security
deposit. Tenant hereby irrevocably authorizes and directs any such subtenant,
upon receipt of a written notice from Landlord stating that a default exists in
the performance of Tenant's obligations under this Lease, to pay to Landlord the
rents due as they become due under the sublease. Tenant agrees that such
subtenant shall have the right to rely upon any such statement and request from
Landlord, and that such subtenant shall pay such rents to Landlord without any
obligation or right to inquire as to whether such default exists.

                  (b)      In the event Tenant shall default in the performance
of its obligations under this Lease, Landlord, at its option and without any
obligation to do so, may require any subtenant to attorn to Landlord, in which
event Landlord shall undertake the obligations of Tenant under such sublease
from the time of the exercise of said option to the termination of such
sublease; provided, however, Landlord shall not be liable for any prepaid rents
or security deposit paid by such subtenant to Tenant or for any other prior
defaults of Tenant under such sublease.

         16.6     TRANSFER PREMIUM FROM ASSIGNMENT OR SUBLETTING. Landlord shall
be entitled to receive from Tenant (as and when received by Tenant) as an item
of additional rent the following amounts (hereinafter the Transfer Premium):
one-half of all amounts received by Tenant from the subtenant or assignee in
excess of the amounts payable by Tenant to Landlord hereunder. The Transfer
Premium shall be reduced by one-half of the reasonable brokerage commissions,
tenant improvement costs (such tenant improvement costs must be incurred for new
tenant improvements constructed to facilitate the sublease or assignment) and
legal fees actually paid by Tenant in order to assign the Lease or to sublet a
portion of the Premises. "Transfer Premium" shall mean all Base Rent, additional
rent or other consideration of any type whatsoever payable by the assignee or
subtenant in excess of the Base Rent and additional rent payable by Tenant under
this Lease. If less than all of the Premises is transferred, the Base Rent and
the additional rent shall be determined on a per-leasable-square-foot basis.
"Transfer Premium" shall also include, but not be limited to, key money and
bonus money paid by the assignee or subtenant to Tenant in connection with such
Transfer, and any payment in excess of fair-market value for services rendered
by Tenant to the assignee or subtenant or for assets, fixtures, inventory,
equipment or furniture transferred by Tenant to the assignee or subtenant in
connection with such Transfer.

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<PAGE>

         16.7     LANDLORD'S OPTION TO RECAPTURE SPACE. Notwithstanding anything
to the contrary contained in this section 16, Landlord shall have the option, by
giving written notice to Tenant within thirty (30) days after receipt of any
request by Tenant to assign this Lease or to sublease more than twenty thousand
(20,000) square feet of space in the Premises to any person or entity other than
an Affiliate (as defined below), to terminate this Lease with respect to said
space as of the date thirty (30) days after Landlord's election. In such event,
Landlord shall reimburse Tenant for 100% of the reasonable brokerage commissions
and legal fees actually paid by Tenant in its effort to assign the Lease or
sublet the Premises. In the event of a recapture by Landlord, if this Lease
shall be canceled with respect to less than the entire Premises, the Base Rent,
Operating Expenses and the number of parking spaces Tenant may use shall be
adjusted on the basis of the number of rentable square feet retained by Tenant
in proportion to the number of rentable square feet contained in the original
Premises, and this Lease as so amended shall continue thereafter in full force
and effect, and upon request of either party, the parties shall execute written
confirmation of same. If Landlord recaptures only a portion of the Premises, it
shall construct and erect at its sole cost such partitions as may be required to
sever the space to be retained by Tenant from the space recaptured by Landlord.
Landlord may, at its option, lease any recaptured portion of the Premises to the
proposed subtenant or assignee or to any other person or entity without
liability to Tenant. Tenant shall not be entitled to any portion of the profit,
if any, Landlord may realize on account of such termination and reletting.
Tenant acknowledges that the purpose of this section is to enable Landlord to
receive profit in the form of higher rent or other consideration to be received
from an assignee or subtenant, to give Landlord the ability to meet additional
space requirements of other tenants of the Project and to permit Landlord to
control the leasing of space in the Project. Tenant acknowledges and agrees that
the requirements of this section are commercially reasonable and are consistent
with the intentions of Landlord and Tenant.

         16.8     LANDLORD'S EXPENSES. In the event Tenant shall assign this
Lease or sublet the Premises or request the consent of Landlord to any Transfer,
then Tenant shall pay Landlord's reasonable costs and expenses incurred in
connection therewith, including, but not limited to, attorneys', architects',
accountants', engineers' or other consultants' fees; provided, however, that
Tenant shall not be obligated to reimburse Landlord for legal fees in excess of
$2,500 with respect to any one Transfer.

         16.9     AFFILIATE TRANSFERS. Notwithstanding anything to the contrary
contained herein, an assignment of the Lease or sublease of all or any portion
of the Premises to any entity which acquires all or substantially all of Tenant,
or which is acquired by Tenant, or which is controlled directly or indirectly by
Tenant, or which entity controls, directly or indirectly, Tenant or which
acquires all or substantially all of the assets of Tenant or which is the
surviving entity resulting from a merger or consolidation of Tenant (in each
such case, an "Affiliate"), shall not require Landlord's consent, provided that
at least thirty (30) days prior to such assignment or sublease (i) Tenant
provides Landlord with reasonable evidence that any such entity maintains annual
revenues sufficient to meet the financial obligations hereunder; (ii) Tenant
notifies Landlord in writing of any such assignment or sublease and provides
Landlord with evidence that such assignment or sublease is a Transfer permitted
by this section 16.9; (iii) prior to the date an assignment or sublease will
take effect, the assignee or sublessee and Tenant shall enter into Landlord's
standard consent to sublease agreement or consent to assignment agreement (the
"TRANSFER AGREEMENTS"), provided that such Transfer Agreements do not
substantially alter the terms and conditions of this Lease, and (iv) subject to
the limitation set forth in section 16.8 of the Lease, Tenant shall pay the
reasonable costs and expenses (including legal fees) incurred by Landlord in
confirming that the assignment or sublease meets the requirements of this
section and in preparing any Transfer Agreement. Whether or not an assignment or
sublease to an Affiliate is made pursuant to the terms of this section, Tenant
shall not be relieved of its obligations under this Lease.

17.      DEFAULT; REMEDIES.

         17.1     DEFAULT BY TENANT. Landlord and Tenant hereby agree that the
occurrence of any one or more of the following events is a material default by
Tenant under this Lease and that said default shall give Landlord the rights
described in section 17.2. Landlord or Landlord's authorized agent shall have
the right to execute and to deliver any notice of default, notice to pay rent or
quit or any other notice Landlord gives Tenant.

                  (a)      Tenant's failure to make any payment of Base Rent,
Tenant's Percentage Share of Operating Expenses, Tenant's Percentage Share of
Real Property Taxes or any other payment required to be made by Tenant
hereunder, as and when due, where such failure shall continue for a period of
seven (7) days after written notice thereof from Landlord to Tenant. In the
event that Landlord serves Tenant with a notice to pay rent or quit pursuant to
applicable unlawful detainer statutes, such notice shall also constitute the
notice required by this section 17.1 (a).

                  (b)      The abandonment of the Premises by Tenant for a
period of thirty (30) consecutive days, in which event Landlord shall not be
obligated to give any notice of default to Tenant.

                  (c)      The failure of Tenant to comply with any of its
obligations under sections 16, 25, 26 and 28 where Tenant fails to comply with
its obligations or fails to cure any earlier breach of such obligation within
ten (10) days following written notice from Landlord to Tenant. In the event
Landlord serves Tenant with a notice to quit or any other notice pursuant to
applicable unlawful detainer statutes, said notice shall also constitute the
notice required by this section 17.1(c).

                  (d)      The failure by Tenant to observe or perform any of
the covenants, conditions or provisions of this Lease to be observed or
performed by Tenant (other than those referenced in sections 17.1 (a), (b) and
(c), above), where such failure shall continue for a period of twenty (20) days
after written notice thereof from Landlord to Tenant; provided, however, that if
the nature of Tenant's nonperformance is such that more than twenty (20) days
are reasonably required for its cure, then Tenant shall not be deemed to be in
default if Tenant commences such cure within said twenty (20) day period and
thereafter diligently pursues such cure to completion. In the event that
Landlord serves Tenant with a notice to quit or any other notice pursuant to
applicable unlawful detainer statutes, said notice shall also constitute the
notice required by this section 17.1(d).

                  (e)      (i) The making by Tenant or any guarantor of Tenant's
obligations hereunder of any general arrangement or general assignment for the
benefit of creditors; (ii) Tenant or any guarantor becoming a "debtor" as
defined in 11 U.S.C. 101 or any successor statute thereto (unless, in the case
of a petition filed against Tenant or guarantor, the same is dismissed within
sixty (60) days); (iii) the appointment of a trustee or receiver to take
possession of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where possession is not restored to Tenant
within thirty (30) days; (iv) the attachment, execution or other judicial
seizure of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where such seizure is not discharged within
thirty (30) days; or (v) the insolvency of Tenant. In the event that any
provision of this section 17.1(e) is unenforceable under applicable law, such
provision shall be of no force or effect.

                  (f)      The discovery by Landlord that any financial
statement, representation or warranty given to Landlord by Tenant, or by any
guarantor of Tenant's obligations hereunder, was materially false at the time
given. Tenant acknowledges that Landlord has entered into this Lease in material
reliance on such information.

                                       12

<PAGE>

                  (g)      If Tenant is a corporation, partnership, limited
liability company or similar entity, the dissolution or liquidation of Tenant.

                  (h)      If Tenant's obligations under this Lease are
guaranteed: (i) the death of a guarantor, (ii) the termination of a guarantor's
liability with respect to this Lease other than in accordance with the terms of
such guaranty, (iii) a guarantor's becoming insolvent or the subject of a
bankruptcy filing, (iv) a guarantor's refusal to honor the guaranty, or (v) a
guarantor's breach of its guaranty obligation on an anticipatory breach basis.

         17.2     REMEDIES.

                  (a)      In the event of any material default or breach of
this Lease by Tenant that is not remedied by Tenant within the applicable cure
period, Landlord may, at any time thereafter, with or without notice or demand,
and without limiting Landlord in the exercise of any right or remedy which
Landlord may have by reason of such default:

                           (i)      terminate Tenant's right to possession of
the Premises by any lawful means, in which case this Lease and the term hereof
shall terminate and Tenant shall immediately surrender possession of the
Premises to Landlord. If Landlord terminates this Lease, Landlord may recover
from Tenant (A) the worth at the time of award of the unpaid rent which had been
earned at the time of termination; (B) the worth at the time of award of the
amount by which the unpaid rent which would have been earned after termination
until the time of award exceeds the amount of such rental loss that Tenant
proves could have been reasonably avoided; (C) the worth at the time of award of
the amount by which the unpaid rent for the balance of the term after the time
of award exceeds the amount of such rental loss that Tenant proves could have
been reasonably avoided; and (D) any other amount necessary to compensate
Landlord for all detriment proximately caused by Tenant's failure to perform its
obligations under the Lease or which in the ordinary course of things would be
likely to result therefrom, including, but not limited to, the cost of
recovering possession of the Premises, expenses of releasing, including
necessary renovation and alteration of the Premises, reasonable attorneys' fees,
any real estate commissions actually paid by Landlord and the unamortized value
of any free rent, reduced rent, tenant improvement allowance or other economic
concessions provided by Landlord. The "worth at time of award" of the amounts
referred to in section 17.2(a)(i)(A) and (B) shall be computed by allowing
interest at the lesser of ten percent (10%) per annum or the maximum interest
rate permitted by applicable law. The worth at the time of award of the amount
referred to in section 17.2(a)(i)(C) shall be computed by discounting such
amount at the discount rate of the Federal Reserve Bank of San Francisco at the
time of award plus one percent (1%). For purposes of this section 17.2(a)(i),
"rent" shall be deemed to be all monetary obligations required to be paid by
Tenant pursuant to the terms of this Lease.

                           (ii)     maintain Tenant's right of possession, in
which event Landlord shall have the remedy described in California Civil Code
section 1951.4 which permits Landlord to continue this Lease in effect after
Tenant's breach and abandonment and recover rent as it becomes due. In the event
Landlord elects to continue this Lease in effect, Tenant shall have the right to
sublet the Premises or assign Tenant's interest in the Lease subject to the
reasonable requirements contained in section 16 of this Lease and provided
further that Landlord shall not require compliance with any standard or
condition contained in section 16 that has become unreasonable at the time
Tenant seeks to sublet or assign the Premises pursuant to this section
17.2(a)(ii).

                           (iii)    collect sublease rents (or appoint a
receiver to collect such rent) and otherwise perform Tenant's obligations at the
Premises, it being agreed, however, that the appointment of a receiver for
Tenant shall not constitute an election by Landlord to terminate this Lease.

                           (iv)     pursue any other remedy now or hereafter
available to Landlord under the laws or judicial decisions of the state in which
the Premises are located.

                  (b)      No remedy or election hereunder shall be deemed
exclusive, but shall, wherever possible, be cumulative with all other remedies
at law or in equity. The expiration or termination of this Lease and/or the
termination of Tenant's right to possession of the Premises shall not relieve
Tenant of liability under any indemnity provisions of this Lease as to matters
occurring or accruing during the term of the Lease or by reason of Tenant's
occupancy of the Premises.

                  (c)      If Tenant abandons or vacates the Premises, Landlord
may re-enter the Premises, and such re-entry shall not be deemed to constitute
Landlord's election to accept a surrender of the Premises or to otherwise
relieve Tenant from liability for its breach of this Lease. No surrender of the
Premises shall be effective against Landlord unless Landlord has entered into a
written agreement with Tenant in which Landlord expressly agrees to (i) accept a
surrender of the Premises and (ii) relieve Tenant of liability under the Lease.
The delivery by Tenant to Landlord of possession of the Premises shall not
constitute the termination of the Lease or the surrender of the Premises.

         17.3     DEFAULT BY LANDLORD. Landlord shall not be in default under
this Lease unless Landlord fails to perform obligations required of Landlord
within thirty (30) days after written notice by Tenant to Landlord and to the
holder of any mortgage or deed of trust encumbering the Project whose name and
address shall have theretofore been furnished to Tenant in writing, specifying
wherein Landlord has failed to perform such obligation; provided, however, that
if the nature of Landlord's obligation is such that more than thirty (30) days
are required for its cure, then Landlord shall not be in default if Landlord
commences performance within such thirty (30) day period and thereafter
diligently pursues the same to completion. Tenant hereby waives its right to
recover consequential damages (including, but not limited to, lost profits) or
punitive damages arising out of a Landlord default. This Lease and the
obligations of Tenant hereunder shall not be affected or impaired because
Landlord is unable to fulfill any of its obligations hereunder or is delayed in
doing so, if such inability or delay is caused by reason of a Force Majeure
Event, and the time for Landlord's performance shall be extended for the period
of any such delay.

                  17.4     LATE CHARGES. Tenant hereby acknowledges that late
payment by Tenant to Landlord of Base Rent, Tenant's Percentage Share of
Operating Expenses or other sums due hereunder will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges and late charges which may be imposed on
Landlord by the terms of any mortgage or trust deed encumbering the Project.
Accordingly, if any installment of Base Rent, Tenant's Percentage Share of
Operating Expenses or any other sum due from Tenant shall not be received by
Landlord within five (5) days after such amount shall be due, then, without any
requirement for notice or demand to Tenant, Tenant shall immediately pay to
Landlord a late charge equal to five percent (5%) of such overdue amount.
Notwithstanding the forgoing. Tenant shall not be obligated to pay to Landlord a
late charge the first time in any twelve (12) month period that Tenant fails to
pay to Landlord a sum due hereunder within five (5) days after such sum is due.
The parties hereby agree that such late charge represents a fair and reasonable
estimate of the costs Landlord will incur by reason of late payment by Tenant.
Acceptance of such late charge by Landlord

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shall in no event constitute a waiver of Tenant's default with respect to such
overdue amount, nor prevent Landlord from exercising any of the other rights and
remedies granted hereunder, including the assessment of interest under section
17.5.

         17.5     INTEREST ON PAST-DUE OBLIGATIONS. Except as expressly herein
provided, any amount due to Landlord that is not paid when due shall bear
interest at the lesser of ten percent (10%) per annum or the maximum rate
permitted by applicable law. Payment of such interest shall not excuse or cure
any default by Tenant under this Lease; provided, however, that interest shall
not be payable on late charges incurred by Tenant nor on any amounts upon which
late charges are paid by Tenant.

f         17.6     PAYMENT OF RENT AND SECURITY DEPOSIT AFTER DEFAULT. If Tenant
fails to pay Base Rent, Tenant's Percentage Share of Operating Expenses, parking
charges or any other monetary obligation due hereunder on the date it is due,
after Tenant's third failure to pay any monetary obligation on the date it is
due in any calendar year, at Landlord's option, all monetary obligations of
Tenant hereunder shall thereafter be paid by cashier's check. If Landlord has
required Tenant to make said payments by cashier's check, Tenant's failure to
make a payment by cashier's check shall be a material default hereunder.

18.      LANDLORD'S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT. All covenants and
agreements to be kept or performed by Tenant under this Lease shall be performed
by Tenant at Tenant's sole cost and expense and without any reduction of rent.
If Tenant shall fail to perform any of its obligations under this Lease after
expiration of any applicable cure period, Landlord may, but shall not be
obligated to, after ten (10) days' prior written notice to Tenant, make any such
payment or perform any such act on Tenant's behalf without waiving its rights
based upon any default of Tenant and without releasing Tenant from any
obligations hereunder. Tenant shall pay to Landlord, within ten (10) days after
delivery by Landlord to Tenant of statements therefore, an amount equal to the
expenditures reasonably made by Landlord in connection with the remedying by
Landlord of Tenant's defaults pursuant to the provisions of this section.

19.      INDEMNITY. Because Tenant is required to insure all of the tenant
improvements in its Premises and its furniture, fixtures and equipment and
because of the requirements to provide waivers of subrogation, Tenant hereby
assumes all risk of damage to property in its Premises. Tenant agrees that
Landlord, its partners, subpartners, parent organization, affiliate, subsidiary,
and their respective officers, directors, legal representatives, successors,
assigns, agents, servants, employees, and independent contractors and each of
them (collectively, "Landlord Parties") shall not be liable to Tenant for, and
are hereby released from any responsibility to Tenant for, any damage either to
persons in the Premises or property of Tenant in the Premises or resulting from
the loss of use thereof, which damage is sustained by Tenant or by other persons
claiming through Tenant (including Tenant Parties), except for damage to
property which Landlord insures or is required to insure pursuant to the terms
and conditions of this Lease and except for injury to persons to the extent
caused by the negligence or willful misconduct of the Landlord Parties. Tenant
shall indemnify, defend, protect, and hold harmless the Landlord Parties from
any and all loss, cost, damage, expense and liability (including without
limitation court costs and reasonable attorneys' fees) (collectively, "Claims")
incurred in connection with or arising from any cause in or on the Premises, any
acts, omissions or negligence of Tenant or of any person claiming by, through or
under Tenant, partners, subpartners, parent organization, affiliate, subsidiary
and their respective officers, directors, contractors, agents, servants,
employees, invitees, guests or licensees of Tenant and each of them
(collectively, "Tenant Parties") or any such person, in or on the Project,
provided that notwithstanding the foregoing, Tenant shall not be required to
indemnify, defend, protect or hold Landlord harmless from any Claims (i) by any
person, company or entity resulting from the negligence or willful misconduct
the Landlord Parties in connection with the Landlord Parties' activities in the
Building or the Project (except for damage to the tenant improvements, and
Tenant's personal property, fixtures, furniture and equipment in the Premises,
to the extent Tenant is required to obtain the requisite insurance coverage
pursuant to this Lease for any such tenant improvements or personal property,
fixtures, furniture or equipment). Landlord shall indemnify, defend, protect and
hold harmless Tenant and Tenant Parties from any Claim resulting from injuries
to persons or property caused by the negligence of willful misconduct of
Landlord and/or its agents and employees Notwithstanding anything to the
contrary in this Lease, in no event shall Landlord be obligated to indemnify
Tenant for consequential damages (including, but not limited to, lost profits)
or punitive damages. Except as otherwise provided in this Lease, Tenant shall
not be obligated to indemnify Landlord for consequential damages (including, but
not limited to, lost profits) or punitive damages.

20.      EXEMPTION OF LANDLORD FROM LIABILITY. Except as otherwise provided in
this Lease, Tenant hereby agrees that Landlord shall not be liable for injury to
Tenant's business or any loss of income therefrom or for loss of or damage to
the merchandise, tenant improvements, fixtures, furniture, equipment, computers,
files, automobiles, or other property of Tenant, Tenant's employees, agents,
contractors or invitees, or any other person in or about the Project, nor shall
Landlord be liable for injury to the person of Tenant, Tenant's employees,
agents, contractors or invitees, whether such damage or injury is caused by or
results from any cause whatsoever including, but not limited to, theft, criminal
activity at the Project, negligent security measures, bombings or bomb scares,
Hazardous Materials, fire, steam, electricity, gas, water or rain, flooding,
breakage of pipes, sprinklers, plumbing, air conditioning or lighting fixtures,
or from any other cause, whether said damage or injury results from conditions
arising upon the Premises or upon other portions of the Project, or from other
sources or places, or from new construction or the repair, alteration or
improvement of any part of the Project, and regardless of whether the cause of
the damage or injury arises out of Landlord's or its employees', agents' or
contractors' negligent or intentional acts. Landlord shall not be liable for any
damages arising from any act or neglect of any employees, agents, contractors or
invitees of any other tenant, occupant or user of the Project, nor from the
failure of Landlord to enforce the provisions of the lease of any other tenant
of the Project. Except as otherwise provided in this Lease, Tenant, as a
material part of the consideration to Landlord hereunder, hereby assumes all
risk of damage to Tenant's property or business or injury to persons in, upon or
about the Project arising from any cause, including Landlord's negligence or the
negligence of its employees, agents or contractors, and Tenant hereby waives all
claims in respect thereof against Landlord, its employees, agents and
contractors.

21.      LANDLORD'S LIABILITY. Tenant acknowledges that Landlord shall have the
right to transfer all or any portion of its interest in the Project and to
assign this Lease to the transferee. Tenant agrees that in the event of such a
transfer Landlord shall automatically be released from all liability under this
Lease arising after the date of such transfer; and Tenant hereby agrees to look
solely to Landlord's transferee for the performance of Landlord's obligations
hereunder after the date of the transfer. Upon such a transfer, Landlord shall,
at its option, return Tenant's security deposit to Tenant or transfer Tenant's
security deposit to Landlord's transferee and, in either event, Landlord shall
have no further liability to Tenant for the return of its security deposit.
Subject to the rights of any lender holding a mortgage or deed of trust
encumbering all or part of the Project, Tenant agrees to look solely to
Landlord's equity interest in the Project for the collection of any judgment
requiring the payment of money by Landlord arising out of (a) Landlord's failure
to perform its obligations under this Lease or (b) the negligence or willful
misconduct of Landlord, its partners, employees and agents; provided, however,
if Landlord's equity interest in the Property is less than One Million Dollars
($1,000,000), Tenant shall have the right to seek recovery from the other assets
of Landlord; provided, further, in no event shall Tenant have the right to
recover damages or obtain a judgment against Landlord's other assets in an
amount in excess of the Differential Amount (as defined below). The
"Differential Amount" shall mean the difference in dollars between One Million
Dollars ($1,000,000.00) and the amount of equity Landlord has in the Project
(e.g., if Landlord has $900,000 of equity in the Project, the Differential
Amount would be $100,000). No

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<PAGE>

other property or assets of Landlord shall be subject to levy, execution or
other enforcement procedure for the satisfaction of any judgment or writ
obtained by Tenant against Landlord. No partner, employee or agent of Landlord
shall be personally liable for the performance of Landlord's obligations
hereunder or be named as a party in any lawsuit arising out of or related to,
directly or indirectly, this Lease and the obligations of Landlord hereunder.
The obligations under this Lease do not constitute personal obligations of the
individual partners of Landlord, if any, and Tenant shall not seek recourse
against the individual partners of Landlord or their assets.

22.      SIGNS, Tenant shall not make any changes to the exterior of the
Premises, install any exterior lights, decorations, balloons, flags, pennants,
banners or painting, or erect or install any signs, windows or door lettering,
placards, decorations or advertising media of any type which can be viewed from
the exterior of the Premises, without Landlord's prior written consent, which
may be given or withheld in Landlord's sole discretion; provided, however, that
Tenant shall have the right to post on the Premises and Tenant's equipment signs
required by law, Landlord hereby approves Tenant's signs that are in existence
on the date of this Lease and which are attached to the Premises. Upon vacation
of the Premises, Tenant shall remove all signs and repair, paint and/or replace
the building facia surface to which its signs are attached. Tenant shall obtain
all applicable governmental permits and approvals for signs and exterior
treatments. All signs, decorations, advertising media, blinds, draperies and
other window treatment or bars or other security installations visible from
outside the Premises shall be subject to Landlord's approval and conform in all
respects to Landlord's requirements.

23.      PARKING, During the term and subject to the rules and regulations
attached hereto as Exhibit "C," as modified by Landlord from time to time (the
"Rules"), Tenant shall be entitled to use the number of parking spaces set forth
in section 1.13 in the Common Area parking lot of the Project. Tenant's parking
rights are in common with the parking rights of any other tenants of the
Project, and all of Tenant's parking spaces are unreserved parking spaces.
Landlord reserves the right at any time to designate areas in the Common Areas
where Tenant may or may not park. If Tenant commits or allows in the parking lot
any of the activities prohibited by the Lease or the Rules, then Landlord shall
have the right, with prior telephonic notice to Tenant's manager at the
Premises, in addition to such other rights and remedies that it may have, to
remove or tow away the vehicle involved and charge the cost to Tenant, which
cost shall be immediately payable by Tenant upon demand by Landlord. Tenant's
parking rights are the personal rights of Tenant, and Tenant shall not transfer,
assign or otherwise convey its parking rights separate and apart from this
Lease. All parking spaces may only be used for parking vehicles no larger than
full-size passenger automobiles or pick-up trucks. Landlord, in addition to its
other remedies, shall have the right to remove or tow away any other vehicles.
Landlord shall not be responsible for enforcing Tenant's parking rights against
any third parties provided, however, if another tenant is interfering with
Tenant's parking rights, Landlord shall cooperate with Tenant in attempting to
cause the tenant to end such interference, provided, further, that Landlord
shall have no obligation to bring a legal action against the non-complying
tenant. Tenant shall not permit or allow any vehicles that belong to or are
controlled by Tenant or Tenant's employees, suppliers, shippers, customers or
invitees to be loaded, unloaded or parked in areas other than those designated
by Landlord for such activities.

24.      BROKER'S FEE. Tenant and Landlord each represent and warrant to the
other that neither has had any dealings or entered into any agreements with any
person, entity, broker or finder other than the persons, if any, listed in
section 1.14, in connection with the negotiation of this Lease, and no other
broker, person, or entity is entitled to any commission or finder's fee in
connection with the negotiation of this Lease, and Tenant and Landlord each
agree to indemnify, defend and hold the other harmless from and against any
claims, damages, costs, expenses, attorneys' fees or liability for compensation
or charges which may be claimed by any such unnamed broker, finder or other
similar party by reason of any dealings, actions or agreements of the
indemnifying party. The commission payable to Landlord's broker with respect to
this Lease shall be pursuant to the terms of the separate commission agreement
in effect between Landlord and Landlord's broker. Landlord's broker shall pay a
portion of its commission to Tenant's broker, if so provided in any agreement
between Landlord's broker and Tenant's broker. Nothing in this Lease shall
impose any obligation on Landlord to pay a commission or fee to any party other
than Landlord's broker.

25.      ESTOPPEL CERTIFICATE.

         25.1     DELIVERY OF CERTIFICATE. Tenant shall from time to time, upon
not less than ten (10) business days' prior written notice from Landlord,
execute, acknowledge and deliver to Landlord a statement in writing certifying
such information as Landlord may reasonably request including, but not limited
to, the following: (a) that this Lease is unmodified and in full force and
effect (or, if modified, stating the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect), (b) the date to
which the Base Rent and other charges are paid in advance and the amounts so
payable, (c) that there are not, to Tenant's knowledge, any uncured defaults or
unfulfilled obligations on the part of Landlord, or specifying such defaults or
unfulfilled obligations, if any are claimed, (d) that all tenant improvements to
be constructed by Landlord, if any, have been completed in accordance with
Landlord's obligations, and (e) that Tenant has taken possession of the
Premises. Any such statement may be conclusively relied upon by any prospective
purchaser or encumbrancer of the Project.

         25.2     FAILURE TO DELIVER CERTIFICATE. If Tenant fails to deliver
such statement within such time, after Landlord provides Tenant with a written
notice of default pursuant to section 17.1(c), and after Tenant fails to cure
such default in the applicable ten (10) day cure period, at Landlord's option,
Landlord may treat such failure as (a) a material default of Tenant hereunder,
or (b) it shall be conclusive upon Tenant that (i) this Lease is in full force
and effect, without modification except as may be represented by Landlord, (ii)
there are no uncured defaults in Landlord's performance, (iii) not more than one
month's Base Rent has been paid in advance, (iv) all tenant improvements to be
constructed by Landlord, if any, have been completed in accordance with
Landlord's obligations, and (v) Tenant has taken possession of the Premises.

26.      FINANCIAL INFORMATION. From time to time, at Landlord's request, but
not more often than once in any twelve month period, Tenant shall cause the
following financial information to be delivered to Landlord, at Tenant's sole
cost and expense, upon not less than ten (10) business days' advance written
notice from Landlord: (a) a current financial statement for Tenant and Tenant's
financial statements for the previous two accounting years and (b) a current
financial statement for any guarantor(s) of this Lease and the guarantor'(s)
financial statements for the previous two accounting years. All financial
statements shall be prepared in accordance with generally accepted accounting
principals consistently applied and, if such is the normal practice of Tenant,
shall be audited by an independent certified public accountant. Tenant hereby
authorizes Landlord, from time to time, without notice to Tenant, to obtain a
credit report or credit history on Tenant from any credit reporting company.

27. ENVIRONMENTAL MATTERS/HAZARDOUS MATERIALS.

         27.1     HAZARDOUS MATERIALS DISCLOSURE CERTIFICATE, Prior to executing
this Lease, Tenant has delivered to Landlord Tenant's executed initial Hazardous
Materials Disclosure Certificate (the "Initial HazMat Certificate"), a copy of
which is attached hereto as Exhibit D. Tenant covenants, represents and warrants
to Landlord that the information in the Initial HazMat Certificate is true and
correct and accurately describes the use(s) of Hazardous Materials which will be
made

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<PAGE>

and/or used on the Premises by Tenant. If requested in writing from Landlord or
if Tenant's use of Hazardous Materials has materially changed from previously
submitted information in the Hazardous Materials Disclosure Certificate, Tenant
shall deliver to Landlord an executed Hazardous Materials Disclosure Certificate
(the "HazMat Certificate") describing Tenant's then-present use of Hazardous
Materials on the Premises, and any other reasonably necessary documents and
information as requested by Landlord. The HazMat Certificates required hereunder
shall be in substantially the form attached hereto as Exhibit D.

         27.2     DEFINITION OF HAZARDOUS MATERIALS. As used in this Lease, the
term Hazardous Materials shall mean and include (a) any hazardous or toxic
wastes, materials or substances, and other pollutants or contaminants, which are
or become regulated by any Environmental Laws (defined below); (b) petroleum,
petroleum by-products, gasoline, diesel fuel, crude oil or any fraction thereof;
(c) asbestos and asbestos-containing material, in any form, whether friable or
non-friable; (d) polychlorinated biphenyls; (e) radioactive materials; (f) lead
and lead-containing materials; (g) any other material, waste or substance
displaying toxic, reactive, ignitable or corrosive characteristics, as all such
terms are used in their broadest sense, and are defined or become defined by any
Environmental Law; or (h) any materials which cause or threatens to cause a
nuisance upon or waste to any portion of the Project or any surrounding
property; or poses or threatens to pose a hazard to the health and safety of
persons on the Premises, any other portion of the Project or any surrounding
property. For purposes of this Lease, the term "Hazardous Materials" shall not
include nominal amounts of ordinary household cleaners, office supplies,
janitorial supplies and such similar materials and substances which are not
actionable under any existing or future Environmental Laws.

         27.3     PROHIBITION; ENVIRONMENTAL LAWS. Tenant shall not be entitled
to use or store any Hazardous Materials on, in, or about any portion of the
Premises and the Project without, in each instance, obtaining Landlord's prior
written consent thereto unless such Hazardous Materials are disclosed and
approved in accordance with section 27.1 above. If Landlord, in its sole
discretion, consents to any such usage or storage, then Tenant shall be
permitted to use and/or store only those Hazardous Materials that are necessary
for Tenant's business and to the extent disclosed in the HazMat Certificate and
as expressly approved by Landlord in writing. Any such usage and storage may
only be to the extent of the quantities of Hazardous Materials as specified in
the then-applicable HazMat Certificate as expressly approved by Landlord. In all
events such usage and storage must at ail times be in full compliance with any
and all local, state and federal environmental, health and/or safety-related
laws, statutes, orders, standards, courts' decisions, ordinances, rules and
regulations (as interpreted by judicial and administrative decisions), decrees,
directives, guidelines, permits or permit conditions, currently existing and as
amended, enacted, issued or adopted in the future which are or become applicable
to Tenant or all or any portion of the Premises (collectively, the
"Environmental Laws") and in compliance with the reasonable industry standard
recommendations of Landlord's consultants. Tenant agrees that any material
changes to the type and/or quantities of Hazardous Materials specified in the
most recent HazMat Certificate may be implemented only with the prior written
consent of Landlord, which consent may be given or withheld in Landlord's
reasonable discretion. By way of example and not limitation, it shall be
reasonable for Landlord to withhold its consent to the use of different
Hazardous Materials if such use (a) increases the chance of contamination of the
Project, (b) the Hazardous Material Increases risks to occupants of the Project,
(c) Landlord's environmental consultant does not approve the use of the
Hazardous Material based on reasonable industry standards, (d) Landlord's
insurance carrier objects to the use of the Hazardous Material or (e) Tenant
will not implement all reasonable industry standard safety and handling
recommendations made by Landlord relating to the use of the Hazardous Material.
Assignees and subtenants of Tenant shall not have the right to use additional
Hazardous Materials at the Premises, and Landlord shall have no obligation to
consent to the use of additional Hazardous Materials to accommodate any assignee
or subtenant; provided that this limitation shall not apply to assignees or
subtenants who are Affiliates. Tenant shall not be entitled nor permitted to
install any tanks under, on or about the Premises for the storage of Hazardous
Materials without the express written consent of Landlord, which may be given or
withheld in Landlord's sole discretion. Landlord shall have the right, in
Landlord's sole discretion, at upon prior reasonable notice during the Term of
this Lease to (i) inspect the Premises, (ii) conduct tests and investigations to
determine whether Tenant is in compliance with the provisions of this section 27
or to determine if Hazardous Materials used or stored by Tenant are present in,
on or about the Project, (iii) request lists of all Hazardous Materials used,
stored or otherwise located on, under or about any portion of the Premises
and/or the Common Areas by Tenant, and (iv) if Landlord reasonably believes that
Tenant is not in compliance with the requirements of this section, to require
Tenant to complete a survey of its use, storage and handling of Hazardous
Materials in the Premises, using a form and following procedures satisfactory to
Landlord, in Landlord's reasonable discretion (the "Survey"). Tenant shall
reimburse Landlord for the cost of all such inspections, tests and
investigations, and all reasonable costs associated with any Survey if it is
determined that Tenant is not in compliance with applicable Environmental Laws
or the requirements of this section. If as a result of an inspection, test or
Survey Landlord determines, in Landlord's reasonable discretion, that Tenant
should implement or perform commercially reasonable industry standard safety,
security or compliance measures, Tenant shall within thirty (30) days after
written request by Landlord perform such measures, at Tenant's sole cost and
expense. The aforementioned rights granted herein to Landlord and its
representatives shall not create (a) a duty on Landlord's part to inspect, test,
investigate, monitor or otherwise observe the Premises or the activities of
Tenant and Tenant Parties with respect to Hazardous Materials, including without
limitation, Tenant's operation, use and any remediation relating thereto, or (b)
liability on the part of Landlord and its representatives for Tenant's use,
storage, disposal or remediation of Hazardous Materials, it being understood
that Tenant shall be solely responsible for all liability in connection
therewith.

         27.4     TENANT'S ENVIRONMENTAL OBLIGATIONS. Tenant shall give to
Landlord immediate verbal and follow-up written notice of any spills, releases,
discharges, disposals, emissions, migrations, removals or transportation of
Hazardous Materials on, under or about any portion of the Premises or in any
Common Areas; provided that Tenant has actual knowledge of such event(s) and
such events might adversely effect the Premises or the Project. Tenant, at its
sole cost and expense, covenants and warrants to promptly investigate, clean up,
remove, restore and otherwise remediate (including, without limitation,
preparation of any feasibility studies or reports and the performance of any and
all closures) any spill, release, discharge, disposal, emission, migration or
transportation of Hazardous Materials arising from or related to the intentional
or negligent acts or omissions of Tenant or Tenant Parties such that the
affected portions of the Project and any adjacent property are returned to the
condition existing prior to the appearance of such Hazardous Materials. Any such
investigation, clean up, removal, restoration and other remediation shall only
be performed after Tenant has obtained Landlord's prior written consent, which
consent shall not be unreasonably withheld so long as such actions would not
potentially have a material adverse long-term or short-term effect on any
portion of the Project. Notwithstanding the foregoing, Tenant shall be entitled
to respond immediately to an emergency without first obtaining Landlord's prior
written consent. Tenant, at its sole cost and expense, shall conduct and
perform, or cause to be conducted and performed, all closures as required by any
Environmental Laws or any agencies or other governmental authorities having
jurisdiction thereof. If Tenant fails to so promptly investigate, clean up,
remove, restore, provide closure or otherwise so remediate, Landlord may, but
without obligation to do so, take any and all steps necessary to rectify the
same, and Tenant shall promptly reimburse Landlord, upon demand, for all costs
and expenses to Landlord of performing investigation, cleanup, removal,
restoration, closure and remediation work. All such work undertaken by Tenant,
as required herein, shall be performed in such a manner so as to enable Landlord
to make full economic use of the Premises and other portions of the Project
after the satisfactory completion of such work.

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         27.5     ENVIRONMENTAL INDEMNITY. In addition to Tenant's other
indemnity obligations under this Lease, Tenant agrees to, and shall, protect,
indemnify, defend (with counsel reasonably acceptable to Landlord) and hold
Landlord and the other Indemnitees harmless from and against any and all loss,
cost, damage, liability or expense (including, without limitation, diminution in
value of any portion of the Premises or the Project, damages for the loss of or
restriction on the use of rentable or usable space, and from any adverse impact
of Landlord's marketing of any space within the Project) arising at any time
during or after the term of this Lease in connection with or directly related to
Tenant's use, the presence of, transportation, storage, disposal, migration,
removal, spill, release or discharge of Hazardous Materials on, in or about any
portion of the Project as a direct result of the intentional or negligent acts
or omissions of Tenant or Tenant Parties. Neither the written consent of
Landlord to the presence, use or storage of Hazardous Materials in, on, under or
about any portion of the Project nor the strict compliance by Tenant with all
Environmental Laws shall excuse Tenant from its obligations of indemnification
pursuant hereto. Tenant shall not be relieved of its indemnification obligations
under the provisions of this section 27.5 due to Landlord's status as either an
"owner" or "operator" under any Environmental Laws. Notwithstanding anything to
the contrary herein, Landlord agrees that Tenant will not be liable to Landlord
(and Landlord releases and agrees not to sue Tenant) with respect to any claims,
losses, damages, liabilities, costs, legal fees and expenses arising out of or
relating to the presence of any Hazardous Materials to the extent not caused by
Tenant or Tenant Parties.

         27.6     SURVIVAL This section 27 shall survive the expiration or
earlier termination of this Lease.

28.      SUBORDINATION.

         28.1     EFFECT OF SUBORDINATION. This Lease, and arty Option (as
defined below) granted hereby, upon Landlord's written election, shall be
subject and subordinate to any ground lease, mortgage, deed of trust or any
other hypothecation or security now or hereafter placed upon the Project and to
any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Tenant's right to quiet possession of the
Premises shall not be disturbed so long as Tenant shall pay the rent and observe
and perform all of the provisions of this Lease, unless this Lease is otherwise
terminated pursuant to its terms. At the request of any mortgagee, trustee or
ground lessor, Tenant shall attorn to such person or entity. If any mortgagee,
trustee or ground lessor shall elect to have this Lease and any Options granted
hereby prior to the lien of its mortgage, deed of trust or ground lease, and
shall give written notice thereof to Tenant, this Lease and such Options shall
be deemed prior to such mortgage, deed of trust or ground lease, whether this
Lease or such Options are dated prior or subsequent to the date of said
mortgage, deed of trust or ground lease or the date of recording thereof. In the
event of the foreclosure of a security device, the new owner shall not (a) be
liable for any act or omission of any prior landlord or with respect to events
occurring prior to its acquisition of title, (b) be liable for the breach of
this Lease by any prior landlord or(c) (d) be liable to Tenant for the return of
its security deposit; provided, however, that the forgoing shall not release
Landlord from its obligation to return any security deposit to Tenant.

         28.2     EXECUTION OF DOCUMENTS. Tenant agrees to execute and
acknowledge any accurate and commercially reasonable documents Landlord requests
Tenant execute to effectuate an attornment, a subordination, or to make this
Lease or any Option granted herein prior to the lien of any mortgage, deed of
trust or ground lease, as the case may be. Tenant's failure to execute such
documents within ten (10) days after written demand shall constitute a material
default by Tenant hereunder.

29.      OPTIONS.

         29.1     DEFINITION. As used in this Lease, the word "Option" has the
following meaning: (1) the right or option to extend the term of this Lease or
to renew this Lease, (2) the option or right of first refusal to lease the
Premises or the right of first offer to lease the Premises or the right of first
refusal to lease other space within the Project or the right of first offer to
lease other space within the Project, and (3) the right or option to terminate
this Lease prior to its expiration date or to reduce the size of the Premises.
Any Option granted to Tenant by Landlord must be evidenced by a written option
agreement attached to this Lease as a rider or addendum or said option shall be
of no force or effect.

         29.2     OPTIONS PERSONAL. Each Option granted to Tenant in this Lease,
if any, is personal to the original Tenant and any assignee that is an Affiliate
and may be exercised only by the original Tenant or such an Affiliate while
occupying the entire Premises and may not be exercised or be assigned,
voluntarily or involuntarily, by or to any person or entity other than Tenant or
an Affiliate, including, without limitation, any permitted transferee as defined
in section 16. The Options, if any, herein granted to Tenant are not assignable
separate and apart from this Lease, nor may any Option be separated from this
Lease in any manner, either by reservation or otherwise. If at any time an
Option is exercisable by Tenant or an Affiliate, the Lease has been assigned or
a sublease exists as to any portion of the Premises to an entity other than an
Affiliate, the Option shall be deemed null and void and neither Tenant, an
Affiliate or any assignee or subtenant shall have the right to exercise the
Option.

         29.3     MULTIPLE OPTIONS. In the event that Tenant has multiple
Options to extend or renew this Lease, a later Option cannot be exercised unless
the prior Option to extend or renew this Lease has been so exercised.

         29.4     EFFECT OF DEFAULT ON OPTIONS. Tenant shall have no right to
exercise an Option (i) during the time commencing from the date Landlord gives
to Tenant a notice of default pursuant to section 17.1 and continuing until the
noncompliance alleged in said notice of default is cured, or (ii) if Tenant is
in default of any of the terms, covenants or conditions of this Lease. The
period of time within which an Option may be exercised shall not be extended or
enlarged by reason of Tenant's inability to exercise an Option because of the
provisions of this section.

         29.5 LIMITATIONS ON OPTIONS. Notwithstanding anything to the contrary
contained in any rider or addendum to this Lease, any options, rights of first
refusal or rights of first offer granted hereunder shall be subject and
secondary to Landlord's right to first offer and lease any such space to any
tenant who is then occupying or leasing such space at the time the space becomes
available for leasing and shall be subject and subordinated to any other
options, rights of first refusal or rights of first offer previously given to
any other person or entity.

         29.6     GUARANTEES. Notwithstanding anything to the contrary contained
in any rider or addendum to this Lease, Tenant's right to exercise and the
effectiveness of an Option is conditioned upon Landlord's receipt from any prior
tenant that has not been expressly released from liability under this Lease, and
any guarantor of any obligation of Tenant under this Lease, of a written
agreement reaffirming such person's obligations under this Lease or the
guaranty, as modified by Tenant's exercise of the Option.

30.      LANDLORD RESERVATIONS. Landlord shall have the right: (a) to change the
name and address of the Project or Building upon not less than ninety (90) days
prior written notice; provided, however, In such event Landlord shall reimburse
Tenant for all reasonable costs Tenant pays to third parties for the replacement
of pre-printed stationary, address labels and other

                                       17

<PAGE>

packaging in an amount not to exceed $10,000; (b) to permit any tenant the
exclusive right to conduct any business as long as such exclusive right does not
conflict with any rights expressly given herein; and (c) to place signs, notices
or displays upon the roof, interior or exterior of the Building (provided such
signage does not unreasonably interfere with Tenant's use of the Premises or
with Tenant's signage as permitted by this Lease) or Common Areas of the
Project. Landlord reserves the right to use the exterior walls of the Premises,
and the area beneath, adjacent to and above the Premises together with the right
to install, use, maintain and replace equipment, machinery, pipes, conduits and
wiring through the Premises, which serve other parts of the Project provided
that Landlord's use does not unreasonably interfere with Tenant's use and does
not materially diminish the general appearance of the Premises.

31.      CHANGES TO PROJECT. Landlord shall have the right, in Landlord's sole
discretion, from time to time, to make changes to the size, shape, location,
number and extent of the improvements comprising the Project (hereinafter
referred to as "CHANGES") including, but not limited to, the interior and
exterior of buildings, the Common Areas, HVAC, electrical systems, communication
systems, fire protection and detection systems, plumbing systems, security
systems, parking control systems, driveways, entrances, parking spaces, parking
areas and landscaped areas. In connection with the Changes, Landlord may, among
other things, erect scaffolding or other necessary structures at the Project,
limit or eliminate access to portions of the Project, including portions of the
Common Areas, or perform work in the Building, which work may create noise, dust
or leave debris in the Building. Tenant hereby agrees that such Changes and
Landlord's actions in connection with such Changes shall in no way constitute a
constructive eviction of Tenant or entitle Tenant to any abatement of rent.
Landlord shall have no responsibility or for any reason be liable to Tenant for
any direct or indirect injury to or interference with Tenant's business arising
from the Changes, nor shall Tenant be entitled to any compensation or damages
from Landlord for any inconvenience or annoyance occasioned by such Changes or
Landlord's actions in connection with such Changes. If a Change will materially
interfere with Tenant's use of the Premises, Landlord shall provide Tenant with
reasonable advance notice of such Change. Landlord will cooperate with Tenant in
a reasonable manner to schedule such Changes and shall use commercially
reasonable efforts to minimize disruption to Tenant's business operations caused
by Changes.

32.      Intentionally deleted.

33.      HOLDING OVER. If Tenant remains in possession of the Premises or any
part thereof after the expiration or earlier termination of the term hereof with
Landlord's consent, such occupancy shall be a tenancy from month to month upon
all the terms and conditions of this Lease pertaining to the obligations of
Tenant, except that the Base Rent payable shall be one hundred fifty percent
(150%) of the Base Rent payable immediately preceding the termination date of
this Lease, and all Options, if any, shall be deemed terminated and be of no
further effect. If Tenant remains in possession of the Premises or any part
thereof, after the expiration of the term hereof without Landlord's consent,
Tenant shall, at Landlord's option, be treated as a tenant at sufferance or a
trespasser. Nothing contained herein shall be construed to constitute Landlord's
consent to Tenant holding over at the expiration or earlier termination of the
Lease term or to give Tenant the right to hold over after the expiration or
earlier termination of the Lease term. Tenant hereby agrees to indemnify, hold
harmless and defend Landlord from any cost, loss, claim or liability (including
attorneys' fees) Landlord may incur as a result of Tenant's failure to surrender
possession of the Premises to Landlord upon the termination of this Lease.

34.      LANDLORD'S ACCESS.

         34.1     ACCESS. Landlord and Landlord's agents, contractors and
employees shall have the right to enter the Premises at reasonable times for the
purpose of inspecting the Premises, performing any services required of
Landlord, showing the Premises to prospective purchasers, lenders or tenants,
undertaking safety measures and making alterations, repairs, improvements or
additions to the Premises or to the Project in accordance with the applicable
provisions of this Lease. In the event of an emergency (i.e., events endangering
life, limb or property), Landlord may gain access to the Premises by any
reasonable means, and Landlord shall not be liable to Tenant for damage to the
Premises or to Tenant's property resulting from such access so long as Landlord
first attempts, if prudent under the circumstances, to utilize Building keys or
other normal entry methods available to Landlord. Landlord may at any time place
on or about the Building "for sale" or "for lease" signs.

         34.2     KEYS. Landlord shall have the right to retain keys to the
locks on the entry doors to the Premises and all interior doors at the Premises,
and Landlord shall use commercially reasonable efforts to safeguard such keys
and/or access codes to the doors.

35.      SECURITY MEASURES. Tenant hereby acknowledges that Landlord shall have
no obligation whatsoever to provide guard service or other security measures for
the benefit of the Premises or the Project, and Landlord shall have no liability
to Tenant due to its failure to provide such services. Tenant assumes all
responsibility for the protection of Tenant, its agents, employees, contractors
and invitees and the property of Tenant and of Tenant's agents, employees,
contractors and invitees from acts of third parties. Nothing herein contained
shall prevent Landlord, at Landlord's sole option, from implementing security
measures for the Project or any part thereof, in which event Tenant shall
participate in such security measures and the cost thereof shall be included
within the definition of Operating Expenses. Landlord shall have the right, but
not the obligation, to require all persons entering or leaving the Project to
identify themselves to a security guard and to reasonably establish that such
person should be permitted access to the Project.

36.      EASEMENTS. Landlord reserves to itself the right, from time to time, to
grant such easements, rights and dedications that Landlord deems necessary or
desirable, and to cause the recordation of parcel maps and restrictions, so long
as such easements, rights, dedications, maps and restrictions do not
unreasonably interfere with the use of the Premises by Tenant. Tenant shall sign
any of the aforementioned documents within ten (10) days after Landlord's
request, and Tenant's failure to do so shall constitute a material default by
Tenant.

37.      TRANSPORTATION MANAGEMENT. Tenant shall fully comply at its sole
expense with all present or future programs required by any governmental or
quasi-governmental entity or Landlord to manage parking, transportation, air
pollution or traffic in and around the Project or the metropolitan area in which
the Project is located.

38.      SEVERABILITY. The invalidity of any provision of this Lease as
determined by a court of competent jurisdiction shall in no way affect the
validity of any other provision hereof.

39.      TIME OF ESSENCE. Time is of the essence with respect to each of the
obligations to be performed by Tenant and Landlord under this Lease.

40.      DEFINITION OF ADDITIONAL RENT. All monetary obligations of Tenant to
Landlord under the terms of this Lease, including, but not limited to, Base
Rent, Tenant's Percentage Share of Operating Expenses and late charges shall be
deemed to be rent.

                                       18

<PAGE>

41.      INCORPORATION OF PRIOR AGREEMENTS. This Lease and the attachments
listed in section 1.15 contain all agreements of the parties with respect to the
lease of the Premises and any other matter mentioned herein. No prior or
contemporaneous agreement or understanding pertaining to any such matter shall
be effective. Except as otherwise stated in this Lease, Tenant hereby
acknowledges that no real estate broker nor Landlord nor any employee or agents
of any of said persons has made any oral or written warranties or
representations to Tenant concerning the condition or use by Tenant of the
Premises or the Project or concerning any other matter addressed by this Lease.

42.      AMENDMENTS. This Lease may be modified in writing only, signed by the
parties in interest at the time of the modification.

43.      NOTICES. All notices required or permitted by this Lease shall be in
writing and may be delivered (a) in person (by hand, by messenger or by courier
service), (b) by U.S. Postal Service regular mail, (c) by U.S. Postal Service
certified mail, return receipt requested, (d) by U.S. Postal Service Express
Mail, Federal Express or other overnight courier, or (e) by facsimile
transmission, and shall be deemed sufficiently given if served in a manner
specified in this section. Any notice permitted or required hereunder, and any
notice to pay rent or quit or similar notice, shall be deemed personally
delivered to Tenant or Landlord, as the case may be, on the date the notice is
personally delivered to any employee of Tenant or Landlord at the addresses for
notice set forth in Section 1.16. The addresses set forth in section 1.16 of
this Lease shall be the address of each party for notice purposes. Landlord or
Tenant may by written notice to the other specify a different address for notice
purposes. A copy of all notices required or permitted to be given to Landlord
hereunder shall be concurrently transmitted to such party or parties at such
addresses as Landlord may from time to time hereinafter designate by written
notice to Tenant. Any notice sent by regular mail or by certified mail, return
receipt requested, shall be deemed given three (3) days after deposited with the
U.S. Postal Service. Notices delivered by U.S. Express Mail, Federal Express or
other courier shall be deemed given on the date delivered by the carrier to the
appropriate party's address for notice purposes. If any notice is transmitted by
facsimile transmission, the notice shall be deemed delivered upon telephone
confirmation of receipt of the transmission thereof at the appropriate party's
address for notice purposes. A copy of all notices delivered to a party by
facsimile transmission shall also be mailed to the party on the date the
facsimile transmission is completed. If notice is received on Saturday, Sunday
or a legal holiday, it shall be deemed received on the next business day.
Nothing contained herein shall be construed to limit Landlord's right to serve
any notice to pay rent or quit or similar notice by any method permitted by
applicable law, and any such notice shall be effective if served in accordance
with any method permitted by applicable law whether or not the requirements of
this section have been met.

44.      WAIVERS. No waiver by Landlord or Tenant of any provision hereof shall
be deemed a waiver of any other provision hereof or of any subsequent breach by
Landlord or Tenant of the same or any other provision. Landlord's consent to, or
approval of, any act shall not be deemed to render unnecessary the obtaining of
Landlord's consent to or approval of any subsequent act by Tenant. The
acceptance of rent hereunder by Landlord shall not be a waiver of any preceding
breach by Tenant of any provision hereof, other than the failure of Tenant to
pay the particular rent so accepted, regardless of Landlord's knowledge of such
preceding breach at the time of acceptance of such rent. No acceptance by
Landlord of partial payment of any sum due from Tenant shall be deemed a waiver
by Landlord of its right to receive the full amount due, nor shall any
endorsement or statement on any check or accompanying letter from Tenant be
deemed an accord and satisfaction.

45.      Intentionally deleted.

46.      BINDING EFFECT; CHOICE OF LAW. Subject to any provision hereof
restricting assignment or subletting by Tenant, this Lease shall bind the
parties, their heirs, personal representatives, successors and assigns. This
Lease shall be governed by the laws of the state in which the Project is
located, and any litigation concerning this Lease between the parties hereto
shall be initiated in the county in which the Project is located.

47.      ATTORNEYS' FEES. If Landlord or Tenant brings an action to enforce the
terms hereof or declare rights hereunder, the prevailing party in any such
action, or appeal thereon, shall be entitled to its reasonable attorneys' fees
and court costs to be paid by the losing party as fixed by the court in the same
or separate suit, and whether or not such action is pursued to decision or
judgment.

48.      AUCTIONS. Tenant shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction or going-out-of-business sale upon the
Premises or the Common Areas.

49.      MERGER. The voluntary or other surrender of this Lease by Tenant, or a
mutual cancellation thereof, or a termination by Landlord, shall not result in
the merger of Landlord's and Tenant's estates and shall, at the option of
Landlord, terminate all or any existing subtenancies or may, at the option of
Landlord, operate as an assignment to Landlord of any or all of such
subtenancies.

50.      QUIET POSSESSION. Subject to the other terms and conditions of this
Lease, Tenant shall have quiet possession of the Premises for the entire term
hereof subject to all of the provisions of this Lease.

51.      AUTHORITY. If Tenant is a corporation, trust, limited liability
company, limited liability partnership or general or limited partnership,
Tenant, and each individual executing this Lease on behalf of such entity,
represents and warrants that such individual is duly authorized to execute and
deliver this Lease on behalf of said entity, that said entity is duly authorized
to enter into this Lease, and that this Lease is enforceable against said entity
in accordance with its terms.

52.      CONFLICT. Except as otherwise provided herein to the contrary, any
conflict between the printed provisions, exhibits, addenda or riders of this
Lease and the typewritten or handwritten provisions, if any, shall be controlled
by the typewritten or handwritten provisions.

53.      MULTIPLE PARTIES. If more than one person or entity is named as Tenant
herein, the obligations of Tenant shall be the joint and several responsibility
of all persons or entities named herein as Tenant. Service of a notice in
accordance with section 43 on one Tenant shall be deemed service of notice on
all Tenants.

54.      INTERPRETATION. The captions contained in this Lease are for
convenience only and shall not be deemed to limit or alter the meaning of this
Lease. As used in this Lease, the words tenant and landlord include the plural
as well as the singular. Words used in the neuter gender include the masculine
and feminine gender.

55.      PROHIBITION AGAINST RECORDING. Neither this Lease, nor any memorandum,
affidavit or other writing with respect thereto, shall be recorded by Tenant or
by anyone acting through, under or on behalf of Tenant. Landlord shall have the
right to record a memorandum of this Lease, and Tenant shall execute,
acknowledge and deliver to Landlord for recording any memorandum prepared by
Landlord.

                                       19

<PAGE>

56.      RELATIONSHIP OF PARTIES. Nothing contained in this Lease shall be
deemed or construed by the parties hereto or by any third party to create the
relationship of principal and agent, partnership, joint venturer or any
association between Landlord and Tenant.

57.      RULES AND REGULATIONS. Tenant agrees to abide by and conform to the
Rules and to cause its employees, suppliers, customers and invitees to so abide
and conform. Landlord shall have the right, from time to time, to modify, amend
and enforce the Rules in a nondiscriminatory manner. Landlord shall not be
responsible to Tenant for the failure of other persons, including, but not
limited to, other tenants, their agents, employees and invitees, to comply with
the Rules. Tenant acknowledges that the leases of other tenants may not obligate
them to comply with some or all of the Rules. However, if the lease of another
tenant does obligate the tenant to comply with a Rule, and the tenant's failure
to comply with such Rule is having a material adverse effect on Tenant's use of
the Premises, Landlord shall cooperate with Tenant in attempting to cause the
tenant to comply with the Rule, provided, however, Landlord shall have no
obligation to bring a legal action against the non-complying tenant.

58.      RIGHT TO LEASE. Landlord reserves the absolute right to effect such
other tenancies in the Project as Landlord in its sole discretion shall
determine, and Tenant is not relying on any representation that any specific
tenant or number of tenants will occupy the Project.

59.      CONFIDENTIALITY. Tenant acknowledges and agrees that the terms of this
Lease are confidential and constitute proprietary information of Landlord.
Disclosure of the terms hereof could adversely affect the ability of Landlord to
negotiate other leases with respect to the Project and may impair Landlord's
relationship with other tenants of the Project. Tenant agrees that it and its
partners, officers, directors, employees, brokers, lease administrators and
attorneys, if any, shall not disclose the terms and conditions of this Lease to
any other person or entity without the prior written consent of Landlord, which
may be given or withheld by Landlord, in Landlord's reasonable discretion.
Landlord shall also have the right to seek specific performance of this
provision and to seek injunctive relief to prevent its breach or continued
breach.

60.      WAIVER OF JURY TRIAL. LANDLORD AND TENANT HEREBY WAIVE THEIR RESPECTIVE
RIGHT TO TRIAL BY JURY OF ANY CAUSE OF ACTION, CLAIM, COUNTERCLAIM OR
CROSS-COMPLAINT IN ANY ACTION, PROCEEDING AND/OR HEARING BROUGHT BY EITHER
LANDLORD AGAINST TENANT OR TENANT AGAINST LANDLORD ON ANY MATTER WHATSOEVER
ARISING OUT OF, OR IN ANY WAY CONNECTED WITH, THIS LEASE, THE RELATIONSHIP OF
LANDLORD AND TENANT, TENANT'S USE OR OCCUPANCY OF THE PREMISES, OR ANY CLAIM OF
INJURY OR DAMAGE, OR THE ENFORCEMENT OF ANY REMEDY UNDER ANY LAW, STATUTE, OR
REGULATION, EMERGENCY OR OTHERWISE, NOW OR HEREAFTER IN EFFECT.

LANDLORD AND TENANT ACKNOWLEDGE THAT THEY HAVE CAREFULLY READ AND REVIEWED THIS
LEASE AND EACH TERM AND PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS
LEASE, SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY
AGREE THAT, AT THE TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE
COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LANDLORD AND
TENANT WITH RESPECT TO THE PREMISES. TENANT ACKNOWLEDGES THAT IT HAS BEEN GIVEN
THE OPPORTUNITY TO HAVE THIS LEASE REVIEWED BY ITS LEGAL COUNSEL PRIOR TO ITS
EXECUTION. PREPARATION OF THIS LEASE BY LANDLORD OR LANDLORD'S AGENT AND
SUBMISSION OF SAME TO TENANT SHALL NOT BE DEEMED AN OFFER BY LANDLORD TO LEASE
THE PREMISES TO TENANT OR THE GRANT OF AN OPTION TO TENANT TO LEASE THE
PREMISES. THIS LEASE SHALL BECOME BINDING UPON LANDLORD ONLY WHEN FULLY EXECUTED
BY BOTH PARTIES AND WHEN LANDLORD HAS DELIVERED A FULLY EXECUTED ORIGINAL OF
THIS LEASE TO TENANT.

LANDLORD:

The Realty Associates Fund III, L.P., a Delaware limited partnership

By: Realty Associates Fund III GP Limited Partnership, a Delaware limited
       partnership, its general partner

    By: Realty Associates Fund III LLC, a Delaware limited liability company,
           its sole general partner

           By: Realty Associates Fund III Trust, a Massachusetts business trust,
               sole Member

           By: /s/ Scott. W. Amling
               -----------------------------
                        officer
                        Scott. W. Amling
                        Regional Director

    By: Realty Associates Fund III Texas Corporation,
        a Texas corporation, general partner

           By: /s/ Scott. W. Amling
              -------------------------------
                        officer
                        Scott. W. Amling
                        Regional Director

*TENANT:

Celerity Group, Inc., a California corporation

By: /s/ JOHN GOODMAN
    -----------------------------
       JOHN GOODMAN
    -----------------------------
      (print name)

Its: EXECUTIVE VICE PRESIDENT
     ----------------------------
      (print title)

By: /S/ JOHN R. FERRON
    ---------------------------

                                   20
<PAGE>
         -------------------
          (print name)

     Its:-------------------
          (print title)

*If Tenant is a corporation, the authorized officers must sign on behalf of the
corporation and indicate the capacity in which they are signing. The Lease must
be executed by the president or vice president and the secretary or assistant
secretary, unless the bylaws or a resolution of the board of directors shall
otherwise provide, in which event, the bylaws or a certified copy of the
resolution, as the case may be, must be attached to this Lease.

                                       21

<PAGE>

                                    EXHIBIT A

                                    PREMISES

                                [to be attached]

<PAGE>

                            EXHIBIT "A"[FLOOR PLAN]

<PAGE>

                                    EXHIBIT B

                              Intentionally deleted

<PAGE>

                                    EXHIBIT C

                              RULES AND REGULATIONS

                                 GENERAL RULES

Tenant shall faithfully observe and comply with the following Rules and
Regulations:

1.       Tenant shall not alter any locks or Install any new or additional locks
or bolts on any doors or windows of the Premises without providing notification
and keys to Landlord. Tenant shall bear the cost of any lock changes or repairs
required by Tenant.

2.       Access to the Project may be refused unless the person seeking access
has proper identification or has a previously received authorization for access
to the Project. Landlord and its agents shall in no case be liable for damages
for any error with regarding to the admission to or exclusion from the Project
of any person. In case of invasion, mob, riot, public excitement or other
commotion, Landlord reserves the right to prevent access to the Project during
the continuance thereof by any means it deems appropriate for the safety and
protection of life and property.

3.       No cooking shall be done or permitted on the Premises, nor shall the
Premises be used for any improper, objectionable or immoral purposes.
Notwithstanding the foregoing, Underwriters' Laboratory-approved equipment and
microwave ovens may be used in the Premises for heating food and brewing coffee,
tea, hot chocolate and similar beverages for employees and visitors of Tenant,
provided that such use is in accordance with all applicable federal, state and
city laws, codes, ordinances, rules and regulations; and provided further that
such cooking does not result in odors escaping from the Premises.

4.       Except as provided in section 13.1, no boring or cutting for wires
shall be allowed without the consent of Landlord. Tenant shall not install any
radio or television antenna, satellite dish, loudspeaker or other device on the
roof or exterior walls of the Building. Tenant shall not interfere with
broadcasting or reception from or in the Project or elsewhere.

5.       Landlord reserves the right to exclude or expel from the Project any
person who, in the judgment of Landlord, is intoxicated or under the influence
of liquor or drugs, or who shall in any manner do any act in violation of any of
these Rules and Regulations.

6.       Tenant shall store all its trash and garbage within the interior of the
Premises or, if permitted by applicable law, in trash dumpsters in locations
approved by Landlord for such use, in Landlord's reasonable discretion. No
material shall be placed in the trash boxes or receptacles if such material is
of such nature that it may not be disposed of in the ordinary and customary
manner of removing and disposing of trash in the vicinity of the Project without
violation of any law or ordinance governing such disposal.

7.       Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.

                                  PARKING RULES

1.       Tenant shall not permit or allow any vehicles that belong to or are
controlled by Tenant or Tenant's employees, suppliers, shippers, customers or
invitees to be loaded, unloaded or parked in areas other than those designated
by Landlord for such activities and at times approved by Landlord. Users of the
parking area will obey all posted signs and park only in the areas designated
for vehicle parking. Tenant and its customers, employees, shippers and invitees
shall comply with all rules and regulations adopted by Landlord from time to
time relating to truck parking and/or truck loading and unloading.

2.       Landlord reserves the right to relocate all or a part of parking spaces
within the parking area so long as the number of such spaces and proximity to
the Building are substantially the same as existed as of the Commencement Date.

3.       Landlord will not be responsible for any damage to vehicles, injury to
persons or loss of property, all of which risks are assumed by the party using
the parking area.

4.       The maintenance, washing, waxing or cleaning of vehicles in the parking
area or Common Areas is prohibited.

5.       Tenant shall be responsible for seeing that all of its employees,
agents, contractors and invitees comply with the applicable parking rules,
regulations, laws and agreements.

6.       At Landlord's request, Tenant shall provide Landlord with a list which
includes the name of each person using the parking facilities based on Tenant's
parking rights under this Lease and the license plate number of the vehicle
being used by that person. Tenant shall provide Landlord with an updated list
within five (5) days after any part of the list becomes inaccurate. Celerity
Group, Inc. and its Affiliates shall not be obligated to comply with the
requirements of this section 6.

Landlord reserves the right at any time to change or rescind any one or more of
these Rules and Regulations, or to make such other and further reasonable Rules
and Regulations as in Landlord's judgment may from time to time be necessary for
the management, safety, care and cleanliness of the Project, and for the
preservation of good order therein, as well as for the convenience of other
occupants and tenants therein. Any of the foregoing which materially and
adversely interfere with Tenant's business operations (as they exist on the
Commencement Date) shall require Tenant's prior written consent (such consent
not to be unreasonably withheld). Landlord may waive any one or more of these
Rules and Regulations for the benefit of any particular tenant, but no such
waiver by Landlord shall be construed as a waiver of such Rules and Regulations
in favor of any other tenant, nor prevent Landlord from thereafter enforcing any
such Rules or Regulations against any or all tenants of the Project. Tenant
shall be deemed to have read these Rules and Regulations and to have agreed to
abide by them as a condition of its occupancy of the Premises.

<PAGE>

                                    EXHIBIT D

                           Form of HazMat Certificate
                  Re:1507/1515 Centre Point Drive, Milpitas, CA

                               General Information

Name of Responding Company: Celerity Group Inc. (formerly Kinetics Fluid
                            Systems. Inc.)

Mailing Address: 1463 Centre Pointe Drive, Milpitas, CA 95035

Signature:______________________________________________________________________

Title:___________________________________Phone: 408-946-3100

Date: 6/19/03    Age of Facility:___________________  Length of Occupancy:______

Major products manufactured and/or activities conducted on the property: Gas
 Flow Controls, MFC's, Gas Panels

Type of Business Activity(ies):          Hazardous Materials Activities:
(check all that apply)                   (check all that apply)

X      machine shop                      _________degreasing
X      light assembly                    _________chemical/etching/milling
X      research and development          _________wastewater treatment
X      product service or repair         _________painting
_______photo processing                  _________striping
_______automotive service and repair     _________cleaning
_______manufacturing                     _________printing
_______warehouse                         _________analytical lab
_______integrated/printed circuit        _________plating
_______chemical/pharmaceutical product   _________chemical/missing/synthesis
                                         _________silkscreen
                                         X        lathe/mill machining
                                         _________deionizer water product
                                         _________photo masking
                                         _________wave solder
                                         _________metal finishing

                 HAZARDOUS MATERIALS/WASTE HANDLING AND STORAGE

A.       Are hazardous materials handled on any of your shipping and receiving
docks in container quantities greater than one gallon?________ Yes  X  No

B.       If Hazardous materials or waste are stored on the premises, please
check off the nature of the storage and type(s) of materials below:

Types of Storage Container                  Type of Hazardous Mater(list
(list above-ground storage only)            and/or Waste Store

X      1 gallon or 3 liter bottles/cans  _________acid
_______5 to 30 gallon carboys            _________phenol
_______55 gallon drums                   X        caustic/alkaline cleaner
_______tanks                             _________cyanide
                                         _________photo resist stripper
                                         _________paint
                                         X        flammable solvent
                                         _________gasoline/diesel fuel
                                         _________nonflammable/chlorinated
                                                  solvent
                                                  X        oil/fluid

C.       Do you accumulate hazardous waste onsite? X Yes ______ No

         If yes, how is it being handled?

_______on-site treatment or recovery
_______discharged to sewer
X      hauled offsite             If hauled offsite, by whom Onyx, 4227
_______incineration               Technology Drive, Fremont, CA 94538

D.       Indicate your hazardous waste storage status with Department of Health
         Services:

_______generator
_______interim status facility
_______permitted TSDF
X      none of the above

                         WASTEWATER TREATMENT/DISCHARGE

<PAGE>

A.       Do you discharge industrial wastewater to:

_______sewer
_______storm drain
_______surface water
X      no industrial discharge

B.       Is your industrial wastewater treated before discharge? _______Yes
         ________ No

         If yes, what type of treatment is being conducted?
_______neutralization
_______metal hydroxide formation
_______closed-loop treatment
_______cyanide destruct
_______HF treatment
_______other

              SUBSURFACE CONTAINMENT OF HAZARDOUS MATERIALS/WASTES

A.       Are buried tanks/sumps being used for any of the following:

_______hazardous waste storage
_______chemical storage
_______gasoline/diesel fuel storage
_______waste treatment
_______wastewater neutralization
_______industrial wastewater treatment
X      none of the above

B.       If buried tanks are located onsite, indicate their construction:

_______steel            _________fiberglass         _______concrete
_______inside open vault         _________double walled

C.       Are hazardous materials or untreated industrial wastewater transported
via buried piping to tanks, process areas or treatment areas?_____ Yes  X  No

D.       Do you have wet floors in your process areas? _________Yes X No

         If yes, name processes:_______________________________________________

E.       Are abandoned underground tanks or sumps located on the property
         No_________Yes X

                           HAZARDOUS MATERIALS SPILLS

A.       Have hazardous materials ever spilled to:

_______the sewer
_______the storm drain
_______onto the property
X      no spills have occurred

B.       Have you experienced any leaking underground tanks or sumps? __Yes X No

C.       If spills have occurred, were they reported? _________Yes __________ No

         Check which the government agencies that you contacted regarding the
         spill(s):

_______Department of Health Services
_______Department of Fish and Game
_______Environmental Protection Agency
_______Regional Water Quality Control Board
_______Fire Department

<PAGE>

D.       Have you been contacted-by a government agency regarding soil or
         groundwater contamination on your site?

         ______Yes X   No

         Do you have exploratory wells onsite?______Yes   X  No

         If yes, indicate the following:

Number of wells: _________    Approximate depth of wells:___________
Wed diameters:____________

PLEASE ATTACH ENVIRONMENTAL REGULATORY PERMITS, AGENCY REPORTS THAT APPLY TO
YOUR OPERATION AND HAZARDOUS WASTE MANIFESTS.

Check off those enclosed:

X      Hazardous Materials Inventory Statement, HMIS
X      Hazardous Materials Management Plan, HMMP
_______Department of Health Services, Generatory Inspection Report
_______Underground Tank Registrations
_______Industrial Wastewater Discharge Permit
X      Hazardous Waste Manifest

<PAGE>

               HAZARDOUS MATERIALS BUSINESS PLAN INFORMATION SHEET
              For use by Unidocs Member Agencies or where approved
                           by your Local Jurisdiction
              Authority Cited: Ch.6.95 HSC; Title 19, Div. 2, CCR;
                            Title 22, Div. 4.5, CCR

All facilities in Unidocs member jurisdictions that use or store hazardous
materials (defined as either virgin or waste materials) in any quantity are
required to report such use or storage to the appropriate local agency. The
amount of detail required to be reported depends on whether or not a facility is
subject to state Hazardous Materials Business Plan (HMBP) reporting
requirements. Facilities subject to HMBP reporting requirements must complete
and submit to their local agency a HMBP. All other facilities handling hazardous
materials, unless specifically exempted by their local agency, must complete and
submit a Hazardous Materials/Waste Registration Form.

The attached MATRIX INVENTORY FORMAT HAZARDOUS MATERIALS BUSINESS PLAN is the
preferred format for HMBP reporting. [This form was developed by the Certified
Unified Program Agency (CUPA) as an alternative version of the Unified Program
Consolidated Form (UPCF). Businesses have the option to use it or the UPCF
adopted in state regulations. The CUPA or Participating Agency (PA) must accept
the state UPCF and cannot require a business to use the alternative version
developed by the CUPA. The CUPA and PA can require businesses to provide
additional information on either the UPCF or a supplemental page to that
document.] A HMBP including the standard UPCF One-Chemical-Per-Page Inventory
Format is available at www.unidocs.org. If you wish to use forms other than
those included in this document, or the Unidocs standard UPCF Hazardous Material
Business Plan, please contact your local implementing agency for guidance.
Depending upon the nature of storage/handling of hazardous materials at the
facility, additional information may be required to be submitted as Appendices
to the HMBP. Examples of such Appendices could include:

         -        For underground storage tanks (UST), Unified Program
                  Consolidated Forms (UPCF) UST - Facility and UST Tank pages;

         -        California Accidental Release Prevention (CalARP)
                  Program Registration Form;

         -        Toxic Gas Registration Form;

         -        UPCF Onsite Hazardous Waste Treatment Forms;

         -        Storm Water Pollution Prevention Plan; etc.

WHAT IS A HAZARDOUS MATERIALS BUSINESS PLAN?

A HMBP is a document containing detailed information on the storage of hazardous
materials at a facility. Chapter 6.95 of the California Health and Safety Code
(HSC) requires that facilities which use or store such materials at or above
reporting thresholds (see below) submit this information.

WHAT IS THE PURPOSE OF THE HAZARDOUS MATERIALS BUSINESS PLAN?

The intent of the Business Plan is to satisfy federal and state Community
Right-To-Know laws and provide detailed information for use by emergency
responders. All persons at the facility qualified to serve as emergency
coordinators must be thoroughly familiar with the contents and use of the HMBP,
with the operations and activities of the facility, and with the locations of
all hazardous materials records maintained by the facility.

This Hazardous Materials Business Plan has been developed to assist you in
complying with the State requirements and to provide the fire department
adequate information about the type, quantity of -- and management practices
regarding -- hazardous materials that are stored at your facility. Along with
applicable modules and appendices, it is intended to additionally satisfy some
or all of the reporting requirements for the following programs: Hazardous
Materials Storage; CalARP Program Registration; Toxic Gas Ordinance; Hazardous
Waste Generator Registration; Hazardous Waste Contingency Plan; Urban Runoff;
and aboveground storage tank Spill Prevention Control and Countermeasure Plan.

WHO MUST COMPLETE A HAZARDOUS MATERIALS BUSINESS PLAN?

The owner of a facility must complete a HMBP and submit a copy to the local
agency for each site that handles any individual hazardous material or mixture
containing a hazardous material which has a quantity at any time during the
reporting year equal to or greater than:

1.       500 pounds for SOLID HAZARDOUS MATERIALS. [HSC Section 25503.5{a)]

2.       The following amounts for LIQUID HAZARDOUS MATERIALS:

         a.       Lubricating oil as defined by HSC Section 25503.5(b)(2)(B): 55
                  gallons of any type or 275 gallons aggregate quantity on site,
                  HSC Section 25503.5(b)(2)(A)]

         b.       All others, including waste oil: 55 gallons. [HSC
                  Section 25503.5(a)]

3.       The following amounts of HAZARDOUS MATERIAL GASES:

         a.       Oxygen, Nitrogen, or Nitrous Oxide stored/handled at a
                  physician, dentist, podiatrist, veterinarian, or pharmacist's
                  place of business: 1,000 cubic feet of each material on site.
                  [HSC Section 25503.5(b)(l)]

         b.       All others: 200 cubic feet. [HSC Section 25503.5(a)]

4.       Amounts of RADIOACTIVE MATERIALS requiring an emergency plan under
         Parts 30,40, or 70 of Title 10 Code of Federal Regulations or equal to
         or greater than applicable amounts specified in items 1, 2, or 3,
         above, whichever amount is smaller. [HSC Section 25503,5(a)]

5.       Applicable federal threshold planning quantities for EXTREMELY
         HAZARDOUS SUBSTANCES listed in 40 CFR Part 355, Appendix A.

<PAGE>

HAZARDOUS MATERIALS BUSINESS PLAN INFORMATION SHEET (CONTINUED)

Note: RETAIL (CONSUMER) PRODUCTS packaged for direct distribution to, and use
by, the general public are exempt from HMBP requirements except where the local
agency determines otherwise pursuant to HSC Section 25503.5(c)(1). [Local agency
interpretation is that materials qualify for this exemption only if the
following requirements are met: (1) The product is not dispensed from containers
at the storage facility; (2) The product is stored in a "retail display area" as
defined by the 1994 California Fire Code (e.g. Quarts of oil sitting in a
display area for sale at a service station are exempt, but oil used by a
mechanic in the service bay is not exempt.); (3) containers are no larger than 5
gallons (liquids) or 100 pounds (solids); and (4) Handling of the product does
not present unacceptable risk to public health, safety, or the environment.]

WHAT IF I DON'T HANDLE ANY HAZARDOUS MATERIALS IN AMOUNTS REQUIRING A HMBP?

Facilities that are not required to complete a HMBP are still required to
register their hazardous materials with the local agency using the Hazardous
Materials/Waste Registration Form. The local agency will then evaluate the
storage or use and notify you of any permits or storage/use fees that may apply.
(NOTE: THE LOCAL AGENCIES RESERVE THE RIGHT TO REQUIRE A HMBP FOR ANY FACILITY
UPON DETERMINATION THAT THE MANNER OF USE OR STORAGE OF HAZARDOUS MATERIALS IS
SUCH THAT ADDITIONAL INFORMATION IS NECESSARY FOR EMERGENCY RESPONSE PURPOSES.)

WHAT INFORMATION IS REQUIRED TO BE SUBMITTED WITH THE HAZARDOUS MATERIALS
BUSINESS PLAN?

The HMBP must contain the following elements:

         -        Business Activities (Form and instructions attached)

         -        Business Owner/Operator Identification (Form and instructions
                  attached)

         -        Hazardous Materials Inventory (Forms and instructions
                  attached)

         -        Facility Map(s) (Sample form and instructions attached)

         -        Emergency Response/Contingency Plan (Sample forms and
                  instructions attached)

         -        Employee Training Plan (Sample form and instructions attached)

         -        Recordkeeping (Sample form and instructions attached)

HOW OFTEN DO I HAVE TO UPDATE OR RECERTIFY MY HAZARDOUS MATERIALS BUSINESS PLAN?

Within 30 days of the occurrence of any of the following events, the HMBP shall
be revised and the revisions submitted to the local agency: (1) There is a 100%
or more increase in the quantity of a previously disclosed material; (2) The
facility begins handling a previously undisclosed material at or above the
aforementioned HMBP amounts; (3) The facility changes address; (4) Ownership of
the facility changes; or (5) There is a change of business name. [HSC Section
25510]

Additionally, if the local agency determines that the HMBP is deficient in any
way, the plan shall be revised and the revisions submitted to the local agency
within 30 days of the notice to submit a corrected plan. [HSC Section
25505(a)(2)]

Without regard to the above events, the owner, operator, or officially
designated representative of the facility must complete and submit to the local
agency a Hazardous Materials Business Plan Certification Form [or a copy of your
current HMBP with an updated certification signature and date at the bottom of
OES Form 2730, the Business Owner/Operator Identification form (i.e. page 5 of
this packet)] annually. [HSC Section 25503.3(c)] Hazardous Materials Business
Plan Certification Forms are available from your local agency or on the Internet
at www.unidocs.org.

WHO IS MY LOCAL AGENCY?

Refer to the table below. Jurisdiction is determined by whether the facility is
located within city limits or in an unincorporated area.

<TABLE>
<CAPTION>

     CITY/AREA                             LOCAL AGENCY NAME                 ADDRESS                     TELEPHONE NUMBER
-------------------------------------------------------------------------------------------------------------------------
<S>                                  <C>                                 <C>                               <C>
Campbell                             Santo Clara County Fire Department  14700 Winchester Boulevard        (408)378-4010
                                                                         Los Gatos, CA 95030-1818
-------------------------------------------------------------------------------------------------------------------------
Cupertino                            See Campbell
-------------------------------------------------------------------------------------------------------------------------
Gilroy                               Gilroy Building Department          7351 Rosanna                     (408) 846-0430
                                     Life and Environmental Safety       Street Gilroy,
                                     Division                            CA 95020
-------------------------------------------------------------------------------------------------------------------------
Los Altos                            County of Santa Clara               1555 Berger Drive,               (408)299-6930
                                     Department of Environmental         Suite 300 San Jose, CA            or
                                     Health Hazardous Materials          95112-2716                       (408) 918-3400
                                     Compliance Division                 www.EHinfo.org
-------------------------------------------------------------------------------------------------------------------------

Los Altos Hills                      See Los Altos
-------------------------------------------------------------------------------------------------------------------------
Los Gatos                            See Campbell
-------------------------------------------------------------------------------------------------------------------------
Milpitas                             Milpitas Fire Department            455 East Calaveras  Boulevard    (408) 586-3365
                                     Bureau of Fire Prevention           Milpitas, CA 95035
--------------------------------------------------------------------------------------------------------------------------
Monte Sereno                         See Los Altos
--------------------------------------------------------------------------------------------------------------------------
Morgan Hill                          See Campbell
--------------------------------------------------------------------------------------------------------------------------
Mountain View                        Mountain View Fire Department       1000 Villa Street                (650) 903-6378
                                     and Environmental Protection        Mountain View, CA  94041
                                     Fire Division
-------------------------------------------------------------------------------------------------------------------------
Palo Alto                            Palo Alto Fire Department           250 Hamilton                     (650) 329-2184
                                     Hazardous                           Avenue Palo Alto,
                                     Materials Division                  CA 94301
-------------------------------------------------------------------------------------------------------------------------
San Jose                             San Jose Fire                       4 North Second Street,           (408) 277-4659
                                     Department Hazardous                #1100 San Jose, CA
                                     Materials Program                   95113-1305
-------------------------------------------------------------------------------------------------------------------------
Santa Clara                          Santo Clara Fire Department         1675 Lincoln                     (408) 615-4960
                                                                         Street Santa
                                                                         Clara, CA 95050
-------------------------------------------------------------------------------------------------------------------------
Saratoga                             See Los Altos
-------------------------------------------------------------------------------------------------------------------------
Sunnyvale                            Sunnyvale Department of Public      700 All America Way              (408) 730-7212
                                     Safety Fire Prevention Bureau       P.O. Box 3 707
                                                                         Sunnyvale, CA 94088-3707
-------------------------------------------------------------------------------------------------------------------------
Unincorporated Santa Clara County    See Los Altos
--------------------------------------------------------------------------------------------------------------------------
</TABLE>

UN-020-2117                         www.unidocs.org                 REV.01/16/02
<PAGE>

                        UNIFIED PROGRAM CONSOLIDATED FORM
                              FACILITY INFORMATION
                               BUSINESS ACTIVITIES

                                                                   Page 1 of____

                           I. FACILITY IDENTIFICATION
 FACILITY ID #
 (Agency Use                                                 1. EPA ID #    2.
 Only)        4 3  0 1 1  0 0 0 3 9 7                           (Hazardous
                                                                Waste  Only)

  BUSINESS NAME (Same as Facility Name or DBA - Doing Business As)          3.

  Kinetics Fluid Systems

                           II. ACTIVITIES DECLARATION
                NOTE: IF YOU CHECK YES TO ANY PART OF THIS LIST,
 PLEASE SUBMIT THE BUSINESS OWNER/OPERATOR IDENTIFICATION PAGE (OES FORM 2730).

<TABLE>
<CAPTION>
         Does your facility...                                                If Yes, please complete these pages of the UPCF...
<S>                                                                         <C>                 <C>
 A. HAZARDOUS MATERIALS                                                     [X] YES [ ]  NO  4. HAZARDOUS MATERIALS INVENTORY
                                                                                                -CHEMICAL DESCRIPTION (OES 2731)
 Have on site (for any purpose) hazardous materials at or above 55
 gallons for liquids, 500 pounds for solids, or 200 cubic feet for
 compressed gases (include liquids in ASTs and USTs); or the applicable
 Federal threshold quantity for an extremely hazardous substance
 specified in 40 CFR Part 355, Appendix A or B; or handle radiological
 materials in quantities for which an emergency plan is required
 pursuant to 10 CFR Parts 30, 40 or 70?

 B. UNDERGROUND STORAGE TANKS (USTs)                                        [ ] YES [X]  NO 5.  UST FACILITY (Formerly SWRCB Form A)
                                                                                                UST TANK (one page per tank)
                                                                                                (Formerly Form B)

 1 .      Own or operate underground storage tanks?

 2.       Intend to upgrade existing or install new USTs?                   [ ] YES [X] NO 6.   UST FACILITY

                                                                                                UST TANK (one per tank)
                                                                                                UST INSTALLATION - CERTIFICATE OF
                                                                                                COMPLIANCE (one page per tank)
                                                                                                (Formerly Form C)
 3.       Need to report closing a UST?                                     [ ] YES [X] NO 7.   UST TANK (closure portion - one page
                                                                                                per tank)
 C. ABOVE GROUND PETROLEUM STORAGE TANKS (ASTs)
          Own or operate ASTs above these thresholds:
          --  any tank capacity is greater than 660 gallons, or             [ ] YES [X] NO 8.   NO FORM REQUIRED TO CUPAs
          --  the total capacity for the facility is greater than 1,320
              gallons?
 D. HAZARDOUS WASTE                                                         [ ] YES [X] NO  9.  EPA ID NUMBER - provide at the top
                                                                                                of this page
 1.       Generate hazardous waste?

 2.       Recycle more than 100 kg/month of excluded or exempted                                RECYCLABLE MATERIALS REPORT (one
          recyclable materials (per HSC Section 25143.2)?                   [ ] YES [X] NO 10.  per recycler)
 3.       Treat hazardous waste on site?                                    [ ] YES [X] NO 11.  ONSITE HAZARDOUS WASTE TREATMENT -
                                                                                                FACILITY (Formerly DTSC Forms
                                                                                                1772)
                                                                                                ONSITE HAZARDOUS WASTE
                                                                                                TREATMENT - UNIT (one page per
                                                                                                unit) (Formerly DTSC Forms 1772
                                                                                                A,B,C,D and L)
 4.      Treatment subject to financial assurance requirements (for         [ ] YES [X] NO 12.  CERTIFICATION OF FINANCIAL
         Permit by Rule and Conditional Authorization)?                                         ASSURANCE (Formerly DTSC Form 1232)
 5.      Consolidate hazardous waste generated at a remote site?            [ ] YES [X] NO 13.  REMOTE WASTE / CONSOLIDATION
                                                                                                SITE ANNUAL NOTIFICATION (Formerly
                                                                                                DTSC Form 1196)
 6.       Need to report the closure/removal of a tank that was             [ ] YES [X] NO 14.  HAZARDOUS WASTE TANK CLOSURE
          classified as hazardous waste and cleaned onsite?                                     CERTIFICATION (Formerly DTSC Form
                                                                                                1249)
</TABLE>

E. LOCAL REQUIREMENTS                                                        15.

       (You may also be required to provide additional information by your
                             CUPA or local agency.)

UN-020-3/17                 www.unidocs.org                       Ref.01/16/02
<PAGE>

                      BUSINESS ACTIVITIES PAGE INSTRUCTIONS

You must  submit  the  Business  Activities  page  with all  submittals.  [Note:
Numbering of these  instructions  follows the Unified Program  Consolidated Form
(UPCF) data element numbers on the Business  Activities page. These data element
numbers are used for electronic submittal and are the same as the numbering used
in 27 CCR, Appendix C, the Unified Program Data  Dictionary.]  Please number all
pages of your submittal.

1.    FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

2.    EPA ID NUMBER - If you generate, recycle, or treat hazardous waste,
         enter your facility's 12-character U.S. Environmental Protection Agency
         (U.S. EPA) or California Identification number. For facilities in
         California, the number usually starts with the letters "CA," If you do
         not have an ID number, contact the Department of Toxic Substances
         Control (DTSC) at 1-800-618-6942 to obtain one.

3.    BUSINESS NAME - Enter the complete Facility Name.

4.    HAZARDOUS MATERIALS ONSITE - Check the appropriate box to indicate
         whether you have any hazardous material on site in a quantity subject
         to Hazardous Materials Business Plan reporting requirements (please
         refer to the above Hazardous Materials Business Plan Information
         Sheet).

5.     OWN OR OPERATE UNDERGROUND STORAGE TANK (UST) - Check the appropriate
         box to indicate whether you own or operate USTs containing hazardous
         substances as defined in Health and Safety Code (HSC) Section 25316. If
         "YES", and you do not already have on file with your local agency a UST
         Facility page, UST Tank page for each tank, written UST Monitoring
         Plan, and UST Response Plan, then you must submit those documents.
         (There are no UPCF pages for the monitoring and response plans.)

6.    UST INSTALLATION/UPGRADE - Check the appropriate box to indicate
         whether you have installed or upgraded USTs containing hazardous
         substances as defined in HSC Section 25316. If "YES," then you must
         submit to your local agency a UST Installation - Certificate of
         Compliance page for each tank in addition to the UST Facility and Tank
         pages.

7.    UST CLOSURE - Check the appropriate box if you are closing a UST and
         complete the closure portion of the UST Tank page for each tank.

8.    OWN/OPERATE ABOVEGROUND PETROLEUM STORAGE TANK (AST) - Check the
         appropriate box to indicate whether your facility stores petroleum
         aboveground in any tank greater than 660 gallons capacity or has
         aggregate aboveground petroleum storage greater than 1,320 gallons,
         (There is no UPCF page for ASTs.) The following are exempt from this
         requirement:

         -        Pressure vessels or boilers subject to Division 5 of the Labor
                  Code;

         -        Tanks containing hazardous waste if a hazardous waste facility
                  permit has been issued by DTSC;

         -        Aboveground oil production tanks regulated by the Division of
                  Oil and Gas;

         -        Certain oil-filled electrical equipment, including, but not
                  limited to, transformers, circuit breakers, and capacitors.

9.    HAZARDOUS WASTE GENERATOR - Check the appropriate box to indicate
         whether your facility generates a waste that meets any of the hazardous
         waste criteria adopted pursuant to HSC Section 25141.

10.   RECYCLE - Check the appropriate box to indicate whether your facility
         recycles more than 100 kilograms (approximately 220 pounds or 27
         gallons) per month of recyclable material under a claim that the
         material is excluded or exempt per HSC Section 25143.2. If you check
         "YES," and you do not already have a current Recyclable Materials
         Report on file with your Certified Unified Program Agency (CUPA), then
         you must also submit that report to the CUPA. Check "NO" if you only
         send recyclable materials to an offsite recycler.

11.   ONSITE HAZARDOUS WASTE TREATMENT - Check the appropriate box to
         indicate whether your facility engages in regulated onsite treatment of
         hazardous waste. If you check "YES," and you do not already have
         current Onsite Hazardous Waste Treatment Notification - Facility and
         Onsite Hazardous Waste Treatment Notification - Unit documents on file
         with your CUPA, then you must submit those forms to the CUPA.

12.   FINANCIAL ASSURANCE - Check the appropriate box to indicate whether
         your facility has Permit by Rule (PER) and/or Conditionally Authorized
         (CA) operations subject to financial assurance requirements for closure
         of an onsite treatment unit. If you check "YES," and you do not already
         have current "Certification of Financial Assurance" on file with your
         CUPA, then you must submit that form to the CUPA.

13.   HAZARDOUS WASTE REMOTE CONSOLIDATION SITE - Check the appropriate box
         to indicate whether your facility consolidates hazardous waste
         generated at a remote site. By answering "YES," you are indicating that
         you are a hazardous waste generator that collects hazardous waste
         initially at remote sites and subsequently transports the hazardous
         waste to a consolidation site you also operate. If you check "YES," and
         you do not already have current "Remote Waste Consolidation Site Annual
         Notification" page on file with your CUPA, then you must submit that
         form to the CUPA.

14.   HAZARDOUS WASTE TANK CLEANING - Check the appropriate box if any tank
         has been cleaned onsite per Title 22, Div. 4.5, Ch. 32, CCR. If you
         check "YES," then you must submit a Hazardous Waste Tank Closure
         Certification to your local agency.

15.   LOCAL REQUIREMENTS - Check with your local agency before submitting
         this document to determine if any supplemental information is required.

UN-020-4/17                 www.unidocs.org                       Ref.01/16/02
<PAGE>

                       UNIFIED PROGRAM CONSOLIDATED FORM
                              FACILITY INFORMATION
                     BUSINESS OWNER/OPERATOR IDENTIFICATION

                                                                     Page  of
--------------------------------------------------------------------------------
                               I. IDENTIFICATION
--------------------------------------------------------------------------------
FACILITY ID    # 43 011 000397       1. BEGINNING DATE   100. ENDING DATE   101.
(Agency Use Only)                       2/18/2002             2/18/2003
--------------------------------------------------------------------------------
BUSINESS NAME (Same as FACILITY                   3. BUSINESS PHONE         102.
NAME or DBA - Doing Business As)                     408-946-3100
Kinetics Fluid Systems
--------------------------------------------------------------------------------
BUSINESS SITE ADDRESS 1507                                                  103.
Centre Pointe Drive
--------------------------------------------------------------------------------
CITY                                     104.     ZIP CODE                  105.
Milpitas                                      CA  95035
--------------------------------------------------------------------------------
DUN & BRADSTREET                             106. SIC CODE (4 digit #)      107.
60-796-0507                                       3823
--------------------------------------------------------------------------------
COUNTY                                                                      108.
Santa Clara
--------------------------------------------------------------------------------
BUSINESS OPERATOR NAME                       109. BUSINESS OPERATOR PHONE   110.
Kinetics Fluid Systems                            408-946-3100
--------------------------------------------------------------------------------
                               II. BUSINESS OWNER
--------------------------------------------------------------------------------
OWNER NAME                                   111. OWNER PHONE               112.
Kinetics Fluid Systems                            408-946-3100
--------------------------------------------------------------------------------
OWNER MAILING ADDRESS 1507                                                  113.
Center Pointe Drive
--------------------------------------------------------------------------------
CITY                                     114. STATE     115. ZIP CODE       116.
Milpitas                                      CA             95035
--------------------------------------------------------------------------------
                           III. ENVIRONMENTAL CONTACT
--------------------------------------------------------------------------------
CONTACT NAME                                  117. CONTACT PHONE            118.
Rick Regnier                                       503-351-0182
--------------------------------------------------------------------------------
CONTACT MAILING ADDRESS 9660                                                119.
SW Herman Rd
--------------------------------------------------------------------------------
CITY                                     120. STATE     121. ZIP CODE       122.
Tualatin                                      OR             97062
--------------------------------------------------------------------------------
    -PRIMARY-                 IV. EMERGENCY CONTACTS            -SECONDARY-
--------------------------------------------------------------------------------
NAME                                  123. NAME                             128.
Jeff Kircher                               Rick Regnier
--------------------------------------------------------------------------------
TITLE                                 124. TITLE                            129.
Facilities Manager                         Corporate Safety Director
--------------------------------------------------------------------------------
BUSINESS PHONE                        125. BUSINESS PHONE                   130.
408-935-4507                               503-783-2043
--------------------------------------------------------------------------------
24-HOUR PHONE*                        126. 24-HOUR PHONE*                   131.
510-656-4204                               503-351-0182
--------------------------------------------------------------------------------
PAGER #                               127. PAGER #                          132.
510-770-7513                               N/A
--------------------------------------------------------------------------------
ADDITIONAL LOCALLY COLLECTED INFORMATION:                                   133.
Property Owner: Insignia Commercial Group, Inc.    Phone No.: 408-288-2900
Billing Address: 160 W. Santa Clara Street,
San Jose, CA 95113
--------------------------------------------------------------------------------
Certification; Based on my inquiry of those individuals responsible for
obtaining the information, I certify under penalty of law that I have personally
examined and am familiar with the information submitted and believe the
information is true, accurate, and complete.
--------------------------------------------------------------------------------
SIGNATURE OF OWNER/OPERATOR OR     DATE    134. NAME OF DOCUMENT PREPARER   135.
DESIGNATED REPRESENTATIVE          7/10/03      Jeff Kircher
--------------------------------------------------------------------------------
NAME OF SIGNER (print)        136. TITLE OF SIGNER                          137.
Jeff Kircher                       Facilities/Safety Manager
--------------------------------------------------------------------------------
* See Instructions on next page.

UN-020-5/17                 www.unidocs.org                       Ref.01/16/02
<PAGE>

    BUSINESS OWNER/OPERATOR IDENTIFICATION PAGE (OES FORM 2730) INSTRUCTIONS

Except when using the Hazardous Materials Business Plan Certification Form, you
must submit the Business Activities page, the Business Owner/Operator
Identification page, and Hazardous Materials - Chemical Description pages with
all hazardous materials inventory submittals. (Note: Numbering of these
instructions follows the UPCF data element numbers on the Owner/Operator page.)

1.       FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

3.       BUSINESS NAME - Enter the complete Facility Name.

100.     BEGINNING DATE - Enter the beginning year and date of the report.

101.     ENDING DATE - Enter the ending year and date of the report.

102.     BUSINESS PHONE - Enter the phone number, including area code and any
         extension.

103.     BUSINESS SITE ADDRESS - Enter the street address where the facility is
         located, including building number, if applicable. Post office box
         numbers are not acceptable. This information must provide a means to
         locate the facility geographically.

104.     CITY - Enter the city or unincorporated area in which the facility is
         located.

105.     ZIP CODE - Enter the 5 or 9 digit zip code for the facility.

106.     DUN & BRADSTREET - If the business has a D&B number, enter it here.

107.     SIC CODE - Enter the 4 digit Standard Industrial Classification Code
         number for the facility's primary business activity.

108.     COUNTY - Enter the name of the county in which the facility is located.

109.     BUSINESS OPERATOR NAME - Enter the name of the facility operator.

110.     BUSINESS OPERATOR PHONE - Enter the operator's phone number, including
         area code and any extension.

111.     OWNER NAME - Enter the name of the facility owner, if different from
         the operator.

112.     OWNER PHONE - Enter the owner's phone number, including area code and
         any extension.

113.     OWNER MAILING ADDRESS - Enter the owner's street or P.O. box mailing
         address, if different from the site address.

114.     OWNER CITY - Enter the name of the city for the owner's mailing
         address.

115.     OWNER STATE - Enter the 2 character state abbreviation for the owner's
         mailing address.

116.     OWNER ZIP CODE - Enter the 5 or 9 digit zip code for the owner's
         mailing address.

117.     ENVIRONMENTAL CONTACT NAME - Enter the name of the person, if different
         from the Business Owner or Operator, who will receive all environmental
         correspondence and will respond to enforcement activity.

118.     CONTACT PHONE - Enter the environmental contact's phone number,
         including area code and any extension.

119.     CONTACT MAILING ADDRESS - Enter the street or P.O. box mailing address
         where all environmental contact correspondence should be sent, if
         different from the site address.

120.     CITY - Enter the name of the city for the environmental contact's
         mailing address.

121.     STATE - Enter the 2 character state abbreviation for the environmental
         contact's mailing address.

122.     ZIP CODE - Enter the 5 or 9 digit zip code for the environmental
         contact's mailing address.

123.     PRIMARY EMERGENCY CONTACT NAME - Enter the name of a representative
         (i.e. Emergency Coordinator) who can be contacted in case of an
         emergency involving hazardous materials at the facility. This person
         shall have full facility access, site familiarity, and authority to
         make decisions for the business regarding incident mitigation.

124.     TITLE-Enter the title of primary Emergency Coordinator.

125.     BUSINESS PHONE - Enter primary Emergency Coordinator's business phone
         number, including area code and any extension.

126.     24-HOUR PHONE - Enter a phone number that will be answered 24 hours a
         day. If not the primary Emergency Coordinator's home phone number, then
         the number of an answering service able to immediately contact the
         primary Emergency Coordinator must be provided. Please note that this
         is a public document, so any telephone number provided is available to
         the general public any time a review of your facility's records is
         conducted.

127.     PAGER NUMBER - Enter the pager number for the primary Emergency
         Coordinator, if available.

128.     SECONDARY EMERGENCY CONTACT NAME - Enter the name of a secondary
         Emergency Coordinator who can be contacted in the event that the
         primary Emergency Coordinator is not available. The contact shall have
         full facility access, site familiarity, and authority to make decisions
         for the business regarding incident mitigation.

129.     TITLE - Enter the title of the secondary Emergency Coordinator.

130.     BUSINESS PHONE - Enter secondary Emergency Coordinator's business phone
         number, including area code and any extension.

131.     24-HOUR PHONE - Enter a phone number for the secondary Emergency
         Coordinator. See instructions for item 123, above.

132.     PAGER NUMBER - Enter the pager number for the secondary Emergency
         Coordinator, if available.

133.     ADDITIONAL LOCALLY COLLECTED INFORMATION - Enter the name and phone
         number for the property owner. Enter the complete mailing address to
         which bills for permit fees should be sent, if different from items
         119-122, above,

SIGNATURE OF OWNER/OPERATOR OR DESIGNATED REPRESENTATIVE - The Business
         Owner/Operator, or officially designated representative of the
         Owner/Operator, shall sign in the space provided. This signature
         certifies that the signer is familiar with the information submitted,
         and that based on the signer's inquiry of those individuals responsible
         for obtaining the information, it is the signer's belief that the
         submitted information is true, accurate, and complete.

134.     DATE - Enter the date that the document was signed.

135.     NAME OF DOCUMENT PREPARER - Type or print the full name of the person
         who prepared the Business Plan information.

136.     NAME OF SIGNER - Type or print the full name of the person signing this
         document.

137.     TITLE OF SIGNER - Enter the title of the person signing this document.

<PAGE>

                NON-WASTE HAZARDOUS MATERIALS INVENTORY STATEMENT

DATE: 2/18/2002    For use by Unidocs Member Agencies or where approved by your
                               Local Jurisdiction

<TABLE>
---------------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>                                 <C>
BUSINESS NAME: KINETICS FLUID SYSTEMS                   TYPE OF REPORT ON THIS PAGE:        PAGE___________OF____________
(SAME AS FACILITY NAME OR DBA)                          [ ] Add; [ ] Delete; [X] Revise     (One page per building or area)
---------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
------------------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>                           <C>                <C>                 <C>
CHEMICAL LOCATION: GAS PAD                EPCRA CONFIDENTIAL LOCATION?  [ ] Yes; [X] No    FACILITY ID #       4 3-0 1 1-9 5 0 2 6 0
(BUILDING/STORAGE AREA)                   TRADE SECRET INFORMATION?     [ ] Yes; [X] No    (Agency Use Only)
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
  1.      2.              3.                              4.                     5.                          6.
       MAP AND                                 HAZARDOUS COMPONENTS             TYPE                     QUANTITIES
       GRID OR                                  (FOR MIXTURES ONLY)             AND
 HAZ.  LOCATION                           CHEMICAL      %                     PHYSICAL          MAX         AVERAGE    LARGEST
CLASS    CODE         COMMON NAME           NAME        WT.  EHS    CAS NO      STATE          DAILY         DAILY      CONT.
-----  --------  --------------------  --------------  ----  ---  ---------  -----------  ----------------  -------  -----------
<S>    <C>       <C>                   <C>             <C>   <C>  <C>        <C>          <C>               <C>      <C>
  3              Acetone                                     [ ]             [X] pure            10            5          5
                                       ------------------------------------  [ ] mixture
                                                             [ ]
                                       ------------------------------------
                                                             [ ]
                                       -----------------------------------------------------------------------------------------
                                                             [ ]             [ ] solid         Curies:      Days On    Storage
                                       ------------------------------------  [X] liquid   (if radioactive)   Site:   Container:*
                 CAS No.:     [ ] EHS                        [ ]             [ ] gas                          365         F
                 67-64-1
--------------------------------------------------------------------------------------------------------------------------------
  2              Argon (liquid)                              [ ]             [ ] pure           3100         2500       3100
                                       ------------------------------------  [ ] mixture
                                                             [ ]
                                       ------------------------------------
                                                             [ ]
                                       -----------------------------------------------------------------------------------------
                                                             [ ]             [ ] solid         Curies:      Days On    Storage
                                       ------------------------------------  [ ] liquid   (if radioactive)   Site:   Container:*
                 CAS No.:     [ ] EHS                        [ ]             [X] gas                          365         A
                 7440-37-1
--------------------------------------------------------------------------------------------------------------------------------
  2              Argon /Helium/Carbon  Argon            50   [ ]  7440-37-1  [X] pure            330          220        110
                 Dioxide               ------------------------------------  [ ] mixture
                                       Helium           25   [ ]  7440-59-7
                                       -----------------------------------------------------------------------------------------
                                       Carbon Dioxide   25   [ ]   124-38-9  [ ] solid         Curies:      Days On    Storage
                                       ------------------------------------  [ ] liquid   (if radioactive)   Site:   Container:*
                                                             [ ]             [X] gas                         365         L
                 ----------------------------------------------------------
                 CAS No.:     [ ] EHS                        [ ]
                 7440-37-1
--------------------------------------------------------------------------------------------------------------------------------
  2              Helium                                      [ ]             [X] pure           5227         3645       291
                                       ------------------------------------  [ ] mixture
                                                             [ ]
                                       -----------------------------------------------------------------------------------------
                                                             [ ]             [ ] solid         Curies:      Days On    Storage
                                       ------------------------------------  [ ] liquid   (if radioactive)   Site:   Container:*
                                                             [ ]             [X] gas                          365
                 ----------------------------------------------------------
                 CAS No.:     [ ] EHS                        [ ]
                 7440-59-7
--------------------------------------------------------------------------------------------------------------------------------
  2              Helium/Nitrogen       Helium                [ ]  7740-59-7  [ ] pure            627          209        209
                                       ------------------------------------  [X] mixture
                                       Nitrogen              [ ]  7727-37-9
                                       -----------------------------------------------------------------------------------------
                                                             [ ]             [ ] solid         Curies:      Days On    Storage
                                       ------------------------------------  [ ] liquid   (if radioactive)   Site:   Container:*
                                                             [ ]             [X] gas                          365         L
                 ----------------------------------------------------------
                 CAS No.:     [ ] EHS                        [ ]
--------------------------------------------------------------------------------------------------------------------------------
  2              Hydrogen                                    [ ]             [X] pure           4371         3850        261
                                       ------------------------------------  [ ] mixture
                                                             [ ]
                                       -----------------------------------------------------------------------------------------
                                                             [ ]             [ ] solid         Curies:      Days On    Storage
                                       ------------------------------------  [ ] liquid   (if radioactive)   Site:   Container:*
                                                             [ ]             [X] gas                          365         L
                 ----------------------------------------------------------
                 CAS No.:     [ ] EHS                        [ ]
                 1333-74-0
</TABLE>

<TABLE>
<CAPTION>
  1.      2.              3.                7.                  8.                                  9.
       MAP AND                                             STORAGE CODES
       GRID OR
 HAZ.  LOCATION                                        STORAGE       STORAGE           HAZARD
CLASS    CODE         COMMON NAME         UNITS        PRESSURE       TEMP.           CATEGORIES
-----  --------  --------------------  ------------  -----------  -------------  ---------------------
<S>    <C>       <C>                   <C>           <C>          <C>            <C>
  3              Acetone               [X] gallons   [X] ambient  [X] ambient    [X] fire
                                       [ ] pounds    [ ] > amb.   [ ] >amb.      [ ] reactive
                                       [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release
                                       [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                 [X] chronic health
                                                                                 [ ] Radioactive

                 CAS No.:     [ ] EHS
                 67-64-1
------------------------------------------------------------------------------------------------------
  2              Argon (liquid)        [X] gallons   [ ] ambient  [ ] ambient    [ ] fire
                                       [ ] pounds    [X] > amb.   [ ] >amb.      [ ] reactive
                                       [ ] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure  release
                                       [ ] tons                   [X] cryogenic  [ ] acute health
                                                                                 [ ] chronic health
                                                                                 [ ] Radioactive

                 CAS No.:     [ ] EHS
                 7440-37-1
------------------------------------------------------------------------------------------------------
  2              Argon /Helium/Carbon  [ ] gallons   [ ] ambient  [X] ambient    [ ] fire
                 Dioxide               [ ] pounds    [X] > amb.   [ ] >amb.      [ ] reactive
                                       [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure release
                                       [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                 [ ] chronic health
                                                                                 [ ] Radioactive

                 ----------------------
                 CAS No.:     [ ] EHS
                 7440-37-1
------------------------------------------------------------------------------------------------------
  2              Helium                [ ] gallons   [ ] ambient  [X] ambient    [ ] fire
                                       [ ] pounds    [X] > amb.   [ ] >amb.      [ ] reactive
                                       [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure release
                                       [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                 [ ] chronic health
                                                                                 [ ] Radioactive

                 ----------------------
                 CAS No.:     [ ] EHS
                 7440-59-7
------------------------------------------------------------------------------------------------------
  2              Helium/Nitrogen       [ ] gallons   [ ] ambient  [X] ambient    [ ] fire
                                       [ ] pounds    [X] > amb.   [ ] >amb.      [ ] reactive
                                       [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure  release
                                       [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                 [ ] chronic health
                                                                                 [ ] Radioactive

                 ----------------------
                 CAS No.:     [ ] EHS
------------------------------------------------------------------------------------------------------
  2              Hydrogen              [ ] gallons   [ ] ambient  [X] ambient    [X] fire
                                       [ ] pounds    [X] > amb.   [ ] >amb.      [ ] reactive
                                       [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure  release
                                       [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                 [ ] chronic health
                                                                                 [ ] Radioactive

                 ----------------------------------------------------------
                 CAS No.:     [ ] EHS                        [ ]
                 1333-74-0             ------------------------------------
</TABLE>

<TABLE>
<CAPTION>
* Code     Storage Type     Code       Storage Type       Code Storage Type Code Storage Type Code Storage Type   Code Storage Type
------ -------------------- ---- ------------------------ ---- ------------ ---- ------------ ---- -------------- ---- ------------
<S>    <C>                  <C>  <C>                      <C>  <C>          <C>  <C>          <C>  <C>            <C>  <C>
    A  Aboveground Tank      D   Steel Drum                G   Carboy        J   Bag           M   Glass Bottle    P   Tank Wagon
                                                                                                   or Jug
    B  Belowground Tank      E   Plastic/Non-metalic Drum  B   Silo          K   Box           N   Plastic Bottle  Q   Rail Car
                                                                                                   or Jug
    C  Tank Inside Braiding  F   Can                       I   Fiber Drum    L   Cylinder      O   Tote Bin        R   Other
</TABLE>

                                                    If EPCRA, sign below:

                                                    ____________________________
<PAGE>

         NON-WASTE HAZARDOUS MATERIALS INVENTORY STATEMENT INSTRUCTIONS
   (MODIFIED UPCF HAZARDOUS MATERIALS INVENTORY - CHEMICAL DESCRIPTION PAGE)

All non-waste hazardous materials stored at the facility must be listed on the
Non-Waste Hazardous Materials Inventory Statement [or the Unified Program
Consolidated Form (UPCF) Hazardous Materials Inventory - Chemical Description
form (available on the Internet at www.unidocs.org)]. This form allows you to
report up to six chemicals on a single page. Do not list hazardous wastes on
this form.

You must complete a separate inventory line for each individual hazardous
material that you handle at your facility in an aggregate quantity subject to
Hazardous Materials Business Plan reporting requirements (please refer to the
Hazardous Materials Business Plan Information Sheet). The completed inventory
must reflect all hazardous materials at your facility, reported separately for
each building or outside storage area, with separate inventory lines for unique
occurrences of physical state, storage temperature, or storage pressure. Trade
secret materials must be listed on separate pages. Where the aggregate
quantities of some hazardous materials are below the Business Plan threshold
reporting quantity, report the general hazard class of the materials (e.g.
"Misc. Flammable Liquids"), rather than the Common Name, and the aggregate
quantity of all hazardous materials having this hazard class which individually
are below the threshold reporting quantity. Make additional copies of this form
if needed. Your local agency may be capable of accepting electronic reporting of
this information. Contact your local agency for details.

1.       DATE-In the space at the top left side of the form, enter the date this
         inventory statement page was prepared.

2.       BUSINESS NAME - Enter the complete Facility Name.

3.       TYPE OF REPORT ON THIS PAGE - Indicate whether the material is being
         added to the inventory, deleted from the inventory, or if the
         information previously submitted is being revised. (Note: You may leave
         this blank if you resubmit your entire inventory annually.)

4.       PAGE NUMBER - Number each page of the inventory appropriately.

5.       CHEMICAL LOCATION - Enter the name of the building or outside area
         where the hazardous materials reported on this page are handled. A
         chemical stored at the same pressure and temperature in multiple
         locations in one building or area can be reported on a single line.

6.       EPCRA CONFIDENTIAL LOCATION - You must check "Yes" to keep chemical
         location information confidential. If you do not wish to keep chemical
         location information confidential check "No." If "Yes," a signature is
         required on the line provided at the bottom of the form.

7.       TRADE SECRET INFORMATION- Check "Yes" if the information in this
         section is declared a trade secret, "No" if it is not. If "Yes," and
         the business is subject to EPCRA, disclosure of designated Trade Secret
         information is bound by 40 CFR and the business must submit a
         "Substantiation to Accompany Claims of Trade Secrecy" form to the
         United States Environmental Protection Agency.

8.       FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

9.       HAZARD CLASS - In Column 1 of the inventory table, provide the primary
         U.S. Department of Transportation (DOT) numerical hazard class for the
         material being reported on each line.

10.      MAP & GRID OR LOCATION CODE - In Column 2, enter the page number of the
         Storage Map where the location of the hazardous material is shown,
         along with the grid coordinates from your Storage Map that correspond
         to the location of the hazardous material. If applicable, multiple grid
         coordinates can be listed. If you do not use a grid system, enter the
         Location Code shown on your Storage Map.

11.      COMMON NAME, CAS NUMBER, & EHS - In Column 3, enter the following
         information:

         -        COMMON NAME - The Common Name or Trade Name of the hazardous
                  material or mixture (e.g. Gasoline, Acme Super Solvent).

         -        EHS - If the material is considered an Extremely Hazardous
                  Substance as defined in 40 CFR, Part 355, Appendix A, check
                  the EHS box.

         -        CAS NUMBER - Enter the Chemical Abstract Service (CAS) number
                  for the hazardous material. For mixtures, enter the CAS number
                  of the mixture if it has been assigned a number distinct from
                  its components. If the mixture has no CAS number, leave this
                  column blank and report the CAS numbers of the individual
                  hazardous components in the appropriate section, below.

12.      HAZARDOUS COMPONENTS - (Note: If the material is not a mixture, skip
         Column 4 and go directly to Column 5.) In column 4, enter the following
         information regarding Hazardous Components that make up the material
         listed in Column 3:

         -        CHEMICAL NAME - If the Chemical Name is the same as the Common
                  or Trade Name shown in Column 3, you may leave this space
                  blank. If the material is a mixture, list the chemical name of
                  each hazardous component in the mixture ranked by percent
                  weight (refer to the MSDS or manufacturer). All hazardous
                  components present at greater than 1% by weight if
                  non-carcinogenic, or 0.1% by weight if carcinogenic, must be
                  reported. If more than five hazardous components exceed these
                  percentages, you may attach an additional sheet of paper to
                  report the required information.

         -        % BY WEIGHT - Enter the percentage weight of each hazardous
                  component. If a range of percentages is available, report the
                  highest percentage in that range.

         -        EHS - Check the box provided if the component of the mixture
                  is considered an Extremely Hazardous Substance.

         -        CAS NUMBER - List the Chemical Abstract Service (CAS) number
                  for each hazardous component.

13.      TYPE & PHYSICAL STATE - In column 5, identify the material type and
         physical state by checking the "pure" or "mixture box and the "solid",
         "liquid", or "gas" box.

14.      QUANTITIES - In the appropriate spaces within column 6, list:

         -        MAXIMUM DAILY AMOUNT* - Enter the maximum amount of the
                  hazardous material or mixture handled in this building or
                  outside area at any one time over the course of the year. This
                  amount must contain, at a minimum, last year's reported
                  inventory with the reflection of additions, deletions, or
                  revisions projected for the current year.

         -        AVERAGE DAILY AMOUNT* - Calculate the average daily amount of
                  the hazardous material or mixture in this building or outside
                  area. If this is a material that is new to this location, the
                  amount should be the average daily amount you project to be on
                  hand during the course of the year.

         -        LARGEST CONTAINER* - Enter the volume of the largest container
                  in which the material is handled at the location:

         -        CURIES - If the material is radioactive, use the space
                  provided to report the activity in curies.

         -        DAYS ON SITE - Enter the total number of days (e.g. 365)
                  during the year that the material is on site,

         -        STORAGE CONTAINER - Using the container codes listed at the
                  bottom of the inventory statement, list every type of
                  container in which the material is stored/handled.

         *        Except for Curies, units of measure must be the same as that
                  indicated in Column 7,

15.      UNITS - In column 7, check the appropriate unit of measure: gallons for
         liquids, pounds or tons for solids, and cubic feet for gases. If the
         material is a federally defined EHS and is not a mixture, all amounts
         must be reported in pounds.

16.      STORAGE CODES - In the appropriate spaces within Column 8, list:

         -        STORAGE PRESSURE - Check the box that best describes the
                  pressure at which the material is stored: ambient (standard),
                  > amb. (greater than ambient), < amb. (less than ambient), or
                  cryogenic.

         -        STORAGE TEMPERATURE - Check the box that best describes the
                  temperature at which the material is stored.

17.      HAZARD CATEGORIES - In column 9, check the box(es) to describe all
         physical, health, and radioactivity hazards associated with the
         hazardous material.

<TABLE>
<CAPTION>
                      PHYSICAL HAZARDS                                                  HEALTH HAZARDS
                      ----------------                                                  --------------
<S>                                                               <C>
FIRE: Flammable Liquids and Solids, Combustible Liquids,          ACUTE HEALTH (IMMEDIATE): Toxics, Highly Toxics, Irritants,
Pyrophorics, Oxidizers                                            Sensitizers, Corrosives, other hazardous chemicals with an
                                                                  adverse effect with short-term exposure
REACTIVE: Unstable Reactives, Organic Peroxides,
         Water Rsactives, Radioactives

PRESSURE RELEASE: Explosives, Compressed Gases, Blasting Agents    CHRONIC HEALTH (DELAYED): Carcinogens, other chemicals with an
                                                                   adverse effect with long-term exposure
</TABLE>

UN-020-8/17                      www.unidocs.org                   REV. 01/16/02
<PAGE>

                       HAZARDOUS WASTE INVENTORY STATEMENT
For use by Unidocs Member Agencies or where approved by your Local Jurisdiction

DATE: 2/18/2002

BUSINESS NAME: KINETICS FLUID SYSTEMS
(SAME AS FACILITY NAME OR DBA)

<TABLE>
<S>                           <C>                                              <C>
CHEMICAL LOCATION:            EPCRA CONFIDENTIAL LOCATION? [ ] YES; [X] NO     FACILITY ID #
(BUILDING/STORAGE AREA)       TRADE SECRET INFORMATION?    [ ] YES; [X] NO     (Agency Use only)
</TABLE>

<TABLE>
<S>                               <C>
TYPE OF REPORT ON THIS PAGE:      PAGE_____OF__________
[ ] Add; [ ] Delete; [X] Revise   (ONE PAGE PER BUILDING OR AREA)

 4    3    -    0    1    1   -    9    5    0    2    6    0
</TABLE>

<TABLE>
<CAPTION>
  1.       2.            3.                         4.                   5.                        6.
        MAP AND                            HAZARDOUS COMPONENTS        TYPE                     QUANTITIES
        GRID OR                                                         AND
 HAZ.  LOCATION                        CHEMICAL   %                   PHYSICAL          MAX.        AVERAG     LARGEST
CLASS    CODE     WASTE STREAM NAME      NAME    WT.  EHS  CAS NO.     STATE           DAILY        DAILY       CONT.
------------------------------------------------------------------------------------------------------------------------
<S>    <C>       <C>                   <C>       <C>  <C>  <C>      <C>          <C>               <C>       <C>
                                                      [ ]           [X] waste
                                       ---------------------------
                                                      [ ]
                 -------------------------------------------------------------------------------------------------------
                 MANAGEMENT METHOD:                   [ ]           [ ] solid    CURIES:           DAYS ON   STORAGE
                 [ ] Shipped Off-site  ---------------------------  [ ] liquid   (If radioactive)  SITE:     CONTAINER:*
                 [ ] Recycled On-site                 [ ]           [ ] gas
                 [ ] Treated On-site   ---------------------------
                                                      [ ]
                                       ---------------------------
                                                      [ ]
========================================================================================================================
                                                      [ ]           [X] waste
                                       ---------------------------
                                                      [ ]
                 -------------------------------------------------------------------------------------------------------
                 MANAGEMENT METHOD:                   [ ]           [ ] solid    CURIES:           DAYS ON   STORAGE
                 [ ] Shipped Off-site  ---------------------------  [ ] liquid   (If radioactive)  SITE:     CONTAINER:*
                 [ ] Recycled On-site                 [ ]           [ ] gas
                 [ ] Treated On-site   ---------------------------
                                                      [ ]
                                       ---------------------------
                                                      [ ]
========================================================================================================================
                                                      [ ]           [X] waste
                                       ---------------------------
                                                      [ ]
                 -------------------------------------------------------------------------------------------------------
                 MANAGEMENT METHOD:                   [ ]           [ ] solid    CURIES:           DAYS ON   STORAGE
                 [ ] Shipped Off-site  ---------------------------  [ ] liquid   (If radioactive)  SITE:     CONTAINER:*
                 [ ] Recycled On-site                 [ ]           [ ] gas
                 [ ] Treated On-site   ---------------------------
                                                      [ ]
                                       ---------------------------
                                                      [ ]
========================================================================================================================
                                                      [ ]           [X] waste
                                       ---------------------------
                                                      [ ]
                 -------------------------------------------------------------------------------------------------------
                 MANAGEMENT METHOD:                   [ ]           [ ] solid    CURIES:           DAYS ON   STORAGE
                 [ ] Shipped Off-site  ---------------------------  [ ] liquid   (If radioactive)  SITE:     CONTAINER:*
                 [ ] Recycled On-site                 [ ]           [ ] gas
                 [ ] Treated On-site   ---------------------------
                                                      [ ]
                                       ---------------------------
                                                      [ ]
========================================================================================================================
                                                      [ ]           [X] waste
                                       ---------------------------
                                                      [ ]
                 -------------------------------------------------------------------------------------------------------
                 MANAGEMENT METHOD:                   [ ]           [ ] solid    CURIES:           DAYS ON   STORAGE
                 [ ] Shipped Off-site  ---------------------------  [ ] liquid   (If radioactive)  SITE:     CONTAINER:*
                 [ ] Recycled On-site                 [ ]           [ ] gas
                 [ ] Treated On-site   ---------------------------
                                                      [ ]
                                       ---------------------------
                                                      [ ]
========================================================================================================================
                                                      [ ]           [X] waste
                                       ---------------------------
                                                      [ ]
                 -------------------------------------------------------------------------------------------------------
                 MANAGEMENT METHOD:                   [ ]           [ ] solid    CURIES:           DAYS ON   STORAGE
                 [ ] Shipped Off-site  ---------------------------  [ ] liquid   (If radioactive)  SITE:     CONTAINER:*
                 [ ] Recycled On-site                 [ ]           [ ] gas
                 [ ] Treated On-site   ---------------------------
                                                      [ ]
                                       ---------------------------
                                                      [ ]
========================================================================================================================
</TABLE>

<TABLE>
<CAPTION>
  1.       2.            3.                 7.           8.                     9.                      10.
        MAP AND                                                           STORAGE CODES
        GRID OR                           ANNUAL
 HAZ.  LOCATION                            WASTE                      STORAGE       STORAGE            HAZARD
CLASS    CODE     WASTE STREAM NAME       AMOUNT        UNITS        PRESSURE        TEMP.           CATEGORIES
--------------------------------------------------------------------------------------------------------------------
<S>    <C>       <C>                   <C>           <C>            <C>          <C>            <C>
                                                     [ ] gallons    [ ] ambient  [ ] ambient    [ ] fire
                                                     [ ] pounds     [ ] > amb.   [ ] > amb.     [ ] reactive
                                                     [ ] cu. feet   [ ] < amb.   [ ] < amb.     [ ] pressure release
                 ----------------------------------  [ ] tons                    [ ] cryogenic  [ ] acute health
                 MANAGEMENT METHOD:    STATE                                                    [ ] chronic health
                 [ ] Shipped Off-site  WASTES CODE                                              [ ] radioactive
                 [ ] Recycled On-site
                 [ ] Treated On-site

====================================================================================================================
                                                     [ ] gallons    [ ] ambient  [ ] ambient    [ ] fire
                                                     [ ] pounds     [ ] > amb.   [ ] > amb.     [ ] reactive
                                                     [ ] cu. feet   [ ] < amb.   [ ] < amb.     [ ] pressure release
                 ----------------------------------  [ ] tons                    [ ] cryogenic  [ ] acute health
                 MANAGEMENT METHOD:    STATE                                                    [ ] chronic health
                 [ ] Shipped Off-site  WASTES CODE                                              [ ] radioactive
                 [ ] Recycled On-site
                 [ ] Treated On-site

====================================================================================================================
                                                     [ ] gallons    [ ] ambient  [ ] ambient    [ ] fire
                                                     [ ] pounds     [ ] > amb.   [ ] > amb.     [ ] reactive
                                                     [ ] cu. feet   [ ] < amb.   [ ] < amb.     [ ] pressure release
                 ----------------------------------  [ ] tons                    [ ] cryogenic  [ ] acute health
                 MANAGEMENT METHOD:    STATE                                                    [ ] chronic health
                 [ ] Shipped Off-site  WASTES CODE                                              [ ] radioactive
                 [ ] Recycled On-site
                 [ ] Treated On-site

====================================================================================================================
                                                     [ ] gallons    [ ] ambient  [ ] ambient    [ ] fire
                                                     [ ] pounds     [ ] > amb.   [ ] > amb.     [ ] reactive
                                                     [ ] cu. feet   [ ] < amb.   [ ] < amb.     [ ] pressure release
                 ----------------------------------  [ ] tons                    [ ] cryogenic  [ ] acute health
                 MANAGEMENT METHOD:    STATE                                                    [ ] chronic health
                 [ ] Shipped Off-site  WASTES CODE                                              [ ] radioactive
                 [ ] Recycled On-site
                 [ ] Treated On-site

====================================================================================================================
                                                     [ ] gallons    [ ] ambient  [ ] ambient    [ ] fire
                                                     [ ] pounds     [ ] > amb.   [ ] > amb.     [ ] reactive
                                                     [ ] cu. feet   [ ] < amb.   [ ] < amb.     [ ] pressure release
                 ----------------------------------  [ ] tons                    [ ] cryogenic  [ ] acute health
                 MANAGEMENT METHOD:    STATE                                                    [ ] chronic health
                 [ ] Shipped Off-site  WASTES CODE                                              [ ] radioactive
                 [ ] Recycled On-site
                 [ ] Treated On-site

====================================================================================================================
                                                     [ ] gallons    [ ] ambient  [ ] ambient    [ ] fire
                                                     [ ] pounds     [ ] > amb.   [ ] > amb.     [ ] reactive
                                                     [ ] cu. feet   [ ] < amb.   [ ] < amb.     [ ] pressure release
                 ----------------------------------  [ ] tons                    [ ] cryogenic  [ ] acute health
                 MANAGEMENT METHOD:    STATE                                                    [ ] chronic health
                 [ ] Shipped Off-site  WASTES CODE                                              [ ] radioactive
                 [ ] Recycled On-site
                 [ ] Treated On-site

====================================================================================================================
</TABLE>

<TABLE>
<CAPTION>
*     CODE    STORAGE TYPE        CODE        STORAGE TYPE        CODE  STORAGE TYPE    CODE  STORAGE TYPE
      ----  --------------------  ----  ------------------------  ----  -------------   ----  ------------
<S>   <C>   <C>                   <C>   <C>                       <C>   <C>             <C>   <C>
      A     Aboveground Tank      D     Steel Drum                G     Carboy          J     Bag
      B     BelowgroundTank       E     Plastic/Nonmetallic Drum  H     Silo            K     Box
      C     Tank Inside Building  F     Can                       I     Fiber Drum      L     Cylinder
</TABLE>

<TABLE>
<CAPTION>
*     CODE       STORAGE TYPE      CODE  STORAGE TYPE
      ----  ---------------------  ----  ------------
<S>   <C>   <C>                    <C>   <C>            <C>
      M     Glass Bottle or Jug    P     Tank Wagon     IF EPCRA, SIGN BELOW:
      N     Plastic Bottle or Jug  Q     Rail Car
      O     Tote Bin               R     Other          ________________________
</TABLE>

UN-020-9/17                     WWW.UNIDOCS.ORG                     REV.01/16/02
<PAGE>

                HAZARDOUS WASTE INVENTORY STATEMENT INSTRUCTIONS
   (MODIFIED UPCF HAZARDOUS MATERIALS INVENTORY - CHEMICAL DESCRIPTION PAGE)

All hazardous wastes handled at the facility must be listed on the Hazardous
Waste Inventory Statement [or the Unified Program Consolidated Form (UPCF)
Hazardous Materials Inventory - Chemical Description form (available on the
Internet at www.unidocs.org)]. This form allows you to report up to six wastes
on a single page. Do not list non-waste hazardous materials on this form.

You must complete a separate inventory line for each individual hazardous waste
that you handle at your facility in an aggregate quantity subject to Hazardous
Materials Business Plan reporting requirements (please refer to the Hazardous
Materials Business Plan Information Sheet). The completed inventory must reflect
all hazardous wastes at your facility, reported separately for each building or
outside storage area, with separate inventory lines for unique occurrences of
physical state, storage temperature, or storage pressure. Trade secret wastes
must be listed on separate pages. Make additional copies of this form if needed.
Your local agency may be capable of accepting electronic reporting of this
information. Contact your local agency for details.

1.       DATE - In the space at the top left side of the form, enter the date
         this inventory statement page was prepared.

2.       BUSINESS NAME - Enter the complete Facility Name.

3.       TYPE OF REPORT ON THIS PAGE - Indicate whether the waste is being added
         to the inventory, deleted from the inventory, or if the information
         previously submitted is being revised. (Note: You may leave this blank
         if you resubmit your entire inventory annually.)

4.       PAGE NUMBER - Number each page of the inventory appropriately.

5.       CHEMICAL LOCATION - Enter the name of the building or outside area
         where the hazardous wastes reported on this page are handled. A waste
         stored at the same pressure and temperature in multiple locations in
         one building or area can be reported on a single line.

6.       EPCRA CONFIDENTIAL LOCATION - You must check "Yes" to keep chemical
         location information confidential. If you do not wish to keep chemical
         location information confidential check "No." If "Yes," a signature is
         required on the line provided at the bottom of the form.

7.       TRADE SECRET INFORMATION- Check "Yes" if the information in this
         section is declared a trade secret, "No" if it is not. If "Yes," and
         the business is subject to EPCRA, disclosure of designated Trade Secret
         information is bound by 40 CFR and the business must submit a
         "Substantiation to Accompany Claims of Trade Secrecy" form to the
         United States Environmental Protection Agency.

8.       FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

9.       HAZARD CLASS - In Column 1 of the inventory table, provide the primary
         U.S. Department of Transportation (DOT) numerical hazard class for the
         waste being reported on each line.

10.      MAP & GRID OR LOCATION CODE - In Column 2, enter the page number of the
         Storage Map where the location of the hazardous waste is shown, along
         with the grid coordinates from your Storage Map that correspond to the
         location of the hazardous waste. If applicable, multiple grid
         coordinates can be listed. If you do not use a grid system, enter the
         Location Code shown on your Storage Map.

11.      WASTE STREAM NAME & MANAGEMENT METHOD - In Column 3, enter the
         following information:

         -        WASTE STREAM NAME - The Common Name of the hazardous waste
                  (e.g. Used Oil, Spent Solvent).

         -        MANAGEMENT METHOD - Check the appropriate box(es) to indicate
                  how you manage the waste.

12.      HAZARDOUS COMPONENTS - In column 4, enter the following information
         regarding Hazardous Components that make up the waste listed in Column
         3:

         -        CHEMICAL NAME - List the chemical name of each hazardous
                  component in the mixture ranked by percent weight. All
                  hazardous components present at greater than 1% by weight if
                  non-carcinogenic, or 0.1% by weight if carcinogenic, must be
                  reported. If more than five hazardous components exceed these
                  percentages, you may attach an additional sheet of paper to
                  report the required information.

         -        % BY WEIGHT - Enter the percentage weight of each hazardous
                  component. If a range of percentages is available, report the
                  highest percentage in that range.

         -        EHS - Check the box provided if the component of the mixture
                  is considered an Extremely Hazardous Substance as defined in
                  40 CFR, Part 355, Appendix A.

         -        CAS NUMBER - List the Chemical Abstract Service (CAS) number
                  for each hazardous component.

13.      TYPE & PHYSICAL STATE - In column 5, identify the physical state by
         checking the "solid", "liquid", or "gas" box.

14.      QUANTITIES - In the appropriate spaces within column 6, list:

         -        MAXIMUM DAILY AMOUNT* - Enter the maximum amount of the
                  hazardous waste handled in this building or outside area at
                  any one time over the course of the year. This amount must
                  contain, at a minimum, last year's reported inventory with the
                  reflection of additions, deletions, or revisions projected for
                  the current year.

         -        AVERAGE DAILY AMOUNT* - Calculate the average daily amount of
                  the hazardous waste or mixture in this building or outside
                  area. If this is a waste that is new to this location, the
                  amount should be the average daily amount you project to be on
                  hand during the course of the year.

         -        LARGEST CONTAINER* - Enter the volume of the largest container
                  in which the waste is handled at me location.

         -        CURIES - If the waste is radioactive, use the space provided
                  to report the activity in curies.

         -        DAYS ON SITE - Enter the total number of days (e.g. 365)
                  during the year that the waste is on site. (Note: This does
                  not refer to the accumulation time limit for individual waste
                  containers.)

         -        STORAGE CONTAINER - Using the container codes listed at the
                  bottom of the inventory statement, list every type of
                  container in which the waste is stored/handled.

         *        Except for Curies, units of measure must be the same as that
                  indicated in Column 8.

15.      ANNUAL WASTE AMOUNT - Enter the total quantity of this waste generated
         annually. Use the same unit of measure as that indicated in Column 8.

16.      UNITS - In column 8, check the appropriate unit of measure: gallons for
         liquids, pounds or tons for solids, and cubic feet for gases. If the
         waste is a federally defined EHS and is not a mixture, all amounts must
         be reported in pounds.

17.      STORAGE CODES - In the appropriate spaces within Column 9, list:

         -        STORAGE PRESSURE - Check the box that best describes the
                  pressure at which the waste is stored: ambient (standard), >
                  amb. (greater than ambient), < amb. (less than ambient), or
                  cryogenic,

         -        STORAGE TEMPERATURE - Check the box that best describes the
                  temperature at which the waste is stored.

18.      HAZARD CATEGORIES - In column 10, check the box(es) to describe all
         physical, health, and radioactivity hazards associated with the
         hazardous waste.
<TABLE>
<CAPTION>
                      PHYSICAL HAZARDS                                                  HEALTH HAZARDS
<S>                                                               <C>
FIRE: Flammable Liquids and Solids, Combustible Liquids,          ACUTE HEALTH (IMMEDIATE): Toxics, Highly Toxics, Irritants,
      Pyrophorics, Oxidizers                                      Sensitizers, Corrosives, other hazardous chemicals with an
                                                                  adverse effect with short-term exposure
REACTIVE: Unstable Reactives, Organic Peroxides,
          Water Reactives, Radioactives

PRESSURE RELEASE: Explosives, Compressed Gases, Blasting Agents   CHRONIC HEALTH (DELAYED): Carcinogens, other chemicals with an
                                                                  adverse effect with long-term exposure
</TABLE>

UN-020-10/17                    www.unidocs.org                     REV.01/16/02
<PAGE>

                         FACILITY SITE PLAN/STORAGE MAP
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)

Site Address: __________________________________________________________________

Date Map Drawn:______/______/______.   Map Scale: __________  Page _____of _____

<TABLE>
<CAPTION>
     A   B   C   D   E   F   G   H   I   J   K   L   M   N   O   P   Q   R   S   T   U   V   W   X   Y   Z
<S>  <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------
1
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2
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3
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4
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5
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6
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7
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8
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9
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10
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11
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12
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14
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15
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23
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25
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26
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27
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28
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</TABLE>

INSTRUCTIONS ARE PRINTED ON THE FOLLOWING PAGE.

UN-020-11/17                     www.unidocs.org                     REV.1/16/02
<PAGE>

                 FACILITY SITE PLAN AND STORAGE MAP INSTRUCTIONS
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)

A Site Plan (public document) and Storage Map (confidential document) must be
included with your HMBP. For relatively small facilities, these documents may be
combined into one drawing. However, if combined, the combined Site Plan/Storage
Map will become a public document. If you are concerned about displaying the
storage locations of hazardous materials to the public, you must provide a
separate facility Storage Map. Since these drawings are intended for use in
emergency response situations, larger facilities (generally those with complex
and/or multiple buildings) should provide an overall site plan and a separate
storage map for each building/storage area. A blank Facility Site Plan/Storage
Map sheet has been provided on the previous page. You may complete that page or
attach any other drawing(s) that contain(s) the information required below:

1.       SITE PLAN (PUBLIC DOCUMENT): This drawing shall contain, at a minimum,
         the following information:

         a.       An indication of North Direction;

         b.       Approximate scale (e.g. "1 inch - 10 feet".);

         c.       Date the map was drawn;

         d.       All streets bordering the facility;

         e.       Locations of all buildings and other structures;

         f.       Parking lots and internal roads;

         g.       Hazardous materials loading/unloading areas;

         h.       Outside hazardous materials storage or use areas;

         i.       Storm drain and sanitary sewer drain inlets;

         j.       Wells for monitoring of underground tank systems;

         k.       Primary and alternate evacuation routes, emergency exits, and
                  primary and alternate staging areas.

2.       STORAGE MAP (CONFIDENTIAL): The map(s) shall contain, at a minimum, the
         following information:

         a.       General purpose of each section/area within each building
                  (e.g. "Office Area ", "Manufacturing Area ", etc.);

         b.       Location of each hazardous material/waste storage, dispensing,
                  use, or handling area (e.g. individual underground tanks,
                  aboveground tanks, storage rooms, paint booths, etc.). Each
                  area shall be identifiable by a Grid Number, to be used in
                  item 204 on the Hazardous Materials Inventory - Chemical
                  Description pages of the Business Plan.

         c.       For tanks, the capacity limit in gallons and common name of
                  the hazardous material contained in each tank.

         d.       Entrances to and exits from each building and hazardous
                  material/waste room/area;

         e.       Location of each utility emergency shut-off point (i. e. gas,
                  water, electric.);

         f.       Location of each monitoring system control panel (e.g.
                  underground tank monitoring, toxic gas monitoring, etc.).

UN-020-12/17                     WWW.UNIDOCS.ORG                    REV.01/16/02
<PAGE>

                       EMERGENCY RESPONSE/CONTINGENCY PLAN
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)

                Authority Cited: HSC, Section 25504(b); Title 22,    Page __of__
                          Div. 4.5, Ch. 12, Art, 3 CCR

All facilities that handle hazardous materials in specified quantities must have
a written emergency response plan. In addition, facilities that generate 1,000
kilograms or more of hazardous waste per month, or accumulate more than 6,000
kilograms of hazardous waste on-site at any one time, must prepare a contingency
plan. Because the requirements are similar, they have been combined in a single
document, provided below, for your convenience. This plan is a required module
of the Hazardous Materials Business Plan (HMBP). IF YOU ALREADY HAVE A PLAN THAT
MEETS THESE REQUIREMENTS, YOU SHOULD NOT COMPLETE THE BLANK PLAN, BELOW, BUT YOU
MUST INCLUDE A COPY OF YOUR EXISTING PLAN AS PART OF YOUR HMBP.

This site-specific Emergency Response/Contingency Plan is the facility's plan
for dealing with emergencies and shall be implemented immediately whenever there
is a fire, explosion, or release of hazardous materials that could threaten
human health and/or the environment. AT LEAST ONE COPY OF THE PLAN SHALL BE
MAINTAINED AT THE FACILITY FOR USE IN THE EVENT OF AN EMERGENCY AND FOR
INSPECTION BY THE LOCAL AGENCY. Within Santa Clara County, hospitals and police
agencies have delegated receipt of these plans to the local agencies
administering Hazardous Materials Business Plans, so additional copies need not
be submitted. However, a copy of the plan and any revisions must be provided to
any contractor, hospital, or agency with whom special (i.e. contractual)
emergency services arrangements have been made (see section 3, below),

l.       EVACUATION PLAN:

         a. The following alarm signal(s) will be used to begin evacuation of
         the facility (check all that apply):

         [ ] Bells; [ ] Horns/Sirens; [X] Verbal (i.e. shouting); [X] Other
         (specify) PAGING SYSTEM USING TELEPHONE SYSTEM

         b. [X] Evacuation map is prominently displayed throughout the
                  facility.

  Note:  A properly completed HMBP Site Plan satisfies contingency plan map
         requirements. This drawing (or any other drawing that shows primary and
         alternate evacuation routes, emergency exits, and primary and alternate
         staging areas) must be prominently posted throughout the facility in
         locations where it will be visible to employees and visitors.

2.       a.       Emergency Contacts*:

<TABLE>
<CAPTION>
<S>                                                                                        <C>
FIRE/POLICE/AMBULANCE     ..........................................................       Phone No. 911
STATE OFFICE OF EMERGENCY SERVICES      ............................................       Phone No. (800) 852-7550
</TABLE>

         b.       POST-INCIDENT CONTACTS*

<TABLE>
<CAPTION>
<S>                                                                                        <C>
FIRE DEPARTMENT HAZARDOUS MATERIALS PROGRAM   .....................................        Phone NO.: (408) 586-2800
SANTA CLARA COUNTY HAZARDOUS MATERIALS COMPLIANCE DIVISION    .....................        Phone No. (408) 918-3400
CALIFORNIA EPA DEPARTMENT OF TOXIC SUBSTANCES CONTROL    ..........................        Phone No. (510) 540-3739
CAL-OSHA DIVISION OF OCCUPATIONAL SAFETY AND HEALTH    ............................        Phone No. (408) 452-7288
AIR QUALITY MANAGEMENT DISTRICT                   .................................        Phone No. (415) 771-6000
REGIONAL WATER QUALITY CONTROL BOARD    ...........................................        Phone No. (510) 622-2300
</TABLE>

* THESE TELEPHONE NUMBERS ARE PROVIDED AS A GENERAL AID TO EMERGENCY
NOTIFICATION. BE ADVISED THAT ADDITIONAL AGENCIES MAY BE REQUIRED TO BE
NOTIFIED.

         c.       EMERGENCY RESOURCES:

<TABLE>
<CAPTION>
<S>                                                                                        <C>
POISON CONTROL CENTER       ...................................................            Phone No. (800) 876-4766
NEAREST HOSPITAL:   NAME: REGIONAL MEDICAL CENTER                                          Phone No.: (408) 259-5000
                ADDRESS: 225 NORTH JACKSON AVENUE                                          City: SAN JOSE, CA
</TABLE>

3.       ARRANGEMENTS WITH EMERGENCY RESPONDERS:

If you have made special (i.e. contractual) arrangements with any police
department, fire department, hospital, contractor, or State or local emergency
response team to coordinate emergency services, describe those arrangements
below:

________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

UN-020-13/17                     WWW.UNIDOCS.ORG                    REV.01/16/02
<PAGE>

EMERGENCY RESPONSE/CONTINGENCY PLAN (HMBP MODULE)                PAGE____ OF____

4.       EMERGENCY PROCEDURES:

Emergency Coordinator Responsibilities:

 a.      Whenever there is an imminent or actual emergency situation such as a
         explosion, fire, or release, the emergency coordinator (or his/her
         designee when the emergency coordinator is on call) shall:

         i.       Identify the character, exact source, amount, and areal extent
                  of any released hazardous materials.

         ii.      Assess possible hazards to human health or the environment
                  that may result from the explosion, fire, or release. This
                  assessment must consider both direct and indirect effects
                  (e.g. the effects of any toxic, irritating, or asphyxiating
                  gases that are generated, the effects of any hazardous surface
                  water run-off from water or chemical agents used to control
                  fire, etc.).

         iii.     Activate internal facility alarms or communications systems,
                  where applicable, to notify all facility personnel.

         iv.      Notify appropriate local authorities (i.e. call 911).

         v.       Notify the State Office of Emergency Services at
                  1-800-852-7550.

         vi.      Monitor for leaks, pressure build-up, gas generation, or
                  ruptures in valves, pipes, or other equipment shut down in
                  response to the incident.

         vii.     Take all reasonable measures necessary to ensure that fires,
                  explosions, and releases do not occur, recur, or spread to
                  other hazardous materials at the facility.

b.       Before facility operations are resumed in areas of the facility
         affected by the incident, the emergency coordinator shall:

         i.       Provide for proper storage and disposal of recovered waste,
                  contaminated soil or surface water, or any other material that
                  results from a explosion, fire, or release at the facility.

         ii.      Ensure that no material that is incompatible with the released
                  material is transferred, stored, or disposed of in areas of
                  the facility affected by the incident until cleanup procedures
                  are completed.

         iii.     Ensure that all emergency equipment is cleaned, fit for its
                  intended use, and available for use.

         iv.      Notify the California Environmental Protection Agency's
                  Department of Toxic Substances Control, the County of Santa
                  Clara's Hazardous Materials Compliance Division, and the local
                  fire department's hazardous materials program that the
                  facility is in compliance with requirements b-i and b-ii,
                  above.

 Responsibilities of Other Personnel:

On a separate page, list any emergency response functions not covered in the
"Emergency Coordinator Responsibilities" section, above. Next to each function,
list the job title or name of each person responsible for performing the
function. Number the page(s) appropriately.

5.       POST-INCIDENT REPORTING/RECORDING:

The time, date, and details of any hazardous materials incident that requires
implementation of this plan shall be noted in the facility's operating record.

Within 15 days of any hazardous materials emergency incident or threatened
hazardous materials emergency incident that triggers implementation of this
plan, a written Emergency Incident Report, including, but not limited to a
description of the incident and the facility's response to the incident, must be
submitted to the California Environmental Protection Agency's Department of
Toxic Substances Control, the County of Santa Clara's Hazardous Materials
Compliance Division, and the local fire department's hazardous materials
program. The report shall include:

         a.       Name, address, and telephone number of the facility's
                  owner/operator;

         b.       Name, address, and telephone number of the facility;

         c.       Date, time, and type of incident (e.g. fire, explosion, etc.);

         d.       Name and quantity of material(s) involved;

         e.       The extent of injuries, if any;

         f.       An assessment of actual or potential hazards to human health
                  or the environment, where this is applicable;

         g.       Estimated quantity and disposition of recovered material that
                  resulted from the incident;

         h.       Cause(es) of the incident;

         i.       Actions taken in response to the incident;

         j.       Administrative or engineering controls designed to prevent
                  such incidents in the future.

6.       EARTHQUAKE VULNERABILITY: [19 CCR Section 273l(e)]

Identify any areas of the facility and mechanical or other systems that require
immediate inspection or isolation because of their vulnerability to
earthquake-related ground motion:

________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
<PAGE>

EMERGENCY RESPONSE/CONTINGENCY PLAN                              Page __  of __

7. EMERGENCY EQUIPMENT:

22 CCR Section 66265.52(e) [as referenced by 22 CCR Section 66262.34(a)(4)] and
the Hazardous Materials Storage Ordinance require that emergency equipment at
the facility be listed. Completion of the following Emergency Equipment
Inventory Table meets this requirement.

                      EMERGENCY EQUIPMENT INVENTORY STABLE

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------
    1.                                2.                                3.                       4.
EQUIPMENT                         EQUIPMENT
CATEGORY                            TYPE                            LOCATIONS *             DESCRIPTION**
-------------------------------------------------------------------------------------------------------------------
<S>                <C>                                              <C>            <C>
PERSONAL           [ ] Cartridge Respirators
PROTECTIVE         [ ] Chemical Monitoring Equipment (describe)
EQUIPMENT,         [ ] Chemical Protective Aprons/Coats
SAFETY             [ ] Chemical Protective Boots
EQUIPMENT,         [x] Chemical Protective Gloves                   MFG areas      Nitrile, thin-walled, disposable
AND                [ ] Chemical Protective Suits (describe)
FIRST AID          [ ] Face Shields
EQUIPMENT          [x] First Aid Kits/Stations (describe)           See map        Minor first aid treatment
                   [x] Hard Hats                                    Receiving      Standard hard hat
                   [x] Plumbed Eye Wash Stations                    Receiving      Saline solution, 15 min flush
                   [x] Portable Eye Wash Kits (i.e. bottle type)    Parts Dept     2 squeeze bottles
                   [ ] Respirator Cartridges (describe)
                   [x] Safety Glasses/Splash Goggles                Clean rooms    Standard ANSI safety glasses
                   [ ] Safety Showers
                   [ ] Self-Contained Breathing Apparatuses (SCBA)
                   [ ] Other (describe)
-------------------------------------------------------------------------------------------------------------------
FIRE               [x] Automatic Fire Sprinkler Systems
EXTINGUISHING      [ ] Fire Alarm Boxes/Stations
SYSTEMS            [ ] Fire Extinguisher Systems (describe)
                   [x] Other (describe)                             See map        ABC-type
-------------------------------------------------------------------------------------------------------------------
SPILL              [ ] Absorbents (describe)
CONTROL            [ ] Berms/Dikes (describe)
EQUIPMENT          [ ] Decontamination Equipment (describe)
AND                [ ] Emergency Tanks (describe)
DECONTAMINATION    [ ] Exhaust Hoods
EQUIPMENT          [ ] Gas Cylinder Leak Repair Kits (describe)
                   [ ] Neutralizes (describe)
                   [ ] Overpack Drums
                   [ ] Sumps (describe)
                   [ ] Other (describe)
-------------------------------------------------------------------------------------------------------------------
COMMUNICATIONS     [ ] Chemical Alarms (describe)
AND                [ ] Intercoms/ PA Systems
ALARM              [ ] Portable Radios
SYSTEMS            [x] Telephones                                   All areas      Paging option through PBX system
                   [ ] Underground Tank Leak Detection Monitors
                   [x] Other (describe)                             All areas      Bullhorn
-------------------------------------------------------------------------------------------------------------------
ADDITIONAL         [ ]
EQUIPMENT          [ ]
(Use Additional    [ ]
Pages if Needed.)  [ ]
                   [ ]
                   [ ]
------------------------------------------------------------------------------------------------------------------
</TABLE>

*    Use the map and grid numbers from the Storage Map prepared earlier for your
     HMBP.

**   Describe the equipment and its capabilities. If applicable, specify any
     testing/maintenance procedures/intervals. Attach additional pages, numbered
     appropriately, if needed.

UN-020-15/17                 www.unidocs.org                       Ref.01/16/02
<PAGE>

                             EMPLOYEE TRAINING PLAN
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)
                Authority Cited: HSC, Section 255O4(c); Title 22,
                  Div. 4.5, Ch. 12, Art. 3 CCR                   Page ___ of ___

All facilities that handle hazardous materials must have a written employee
training plan. This plan is a required module of the Hazardous Materials
Business Plan (HMBP). A blank plan has been provided below for you to complete
and submit if you do not already have such a plan. IF YOU ALREADY HAVE A BRIEF
WRITTEN DESCRIPTION OF YOUR TRAINING PROGRAM THAT ADDRESSES ALL SUBJECTS COVERED
BELOW, YOU ARE NOT REQUIRED TO COMPLETE THE BLANK PLAN, BELOW, BUT YOU MUST
INCLUDE A COPY OF YOUR EXISTING DOCUMENT AS PART OF YOUR HMBP.

Check all boxes that apply. [Note: Items marked with an asterisk (*) are
required.]:

1. PERSONNEL are trained in the following procedures:

[X]      Internal alarm/notification *

[X]      Evacuation/re-entry procedures & assembly point locations*

[X]      Emergency incident reporting

[X]      External emergency response organization notification

[X]      Location(s) and contents of Emergency Response/Contingency Plan

[X]      Facility evacuation drills, that are conducted at least (specify)
         Quarterly                                      (e.g. "Quarterly", etc.)

2. CHEMICAL HANDLERS are additionally trained in the following:

[X]      Safe methods for handling and storage of hazardous materials *

[X]      Location(s) and proper use of fire and spill control equipment

[ ]      Spill procedures/emergency procedures

[X]      Proper use of personal protective equipment *

[X]      Specific hazard(s) of each chemical to which they may be exposed,
         including routes of exposure (i.e. inhalation, ingestion, absorption) *

[ ]      HAZARDOUS WASTE HANDLERS/MANAGERS are trained in all aspects of
         hazardous waste management specific to their job duties (e.g. container
         accumulation time requirements, labeling requirements, storage area
         inspection requirements, manifesting requirements, etc.) *

3. EMERGENCY RESPONSE TEAM MEMBERS are capable of and engaged in the following:

[ ]      Personnel rescue procedures

[ ]      Shutdown of operations

[ ]      Liaison with responding agencies

[ ]      Use, maintenance, and replacement of emergency response equipment

[ ]      Refresher training, which is provided at least annually *

[ ]      Emergency response drills, which are conducted at least (specify) _____
         ___________ (e.g. "Quarterly", etc.)

<PAGE>

                                 RECORD KEEPING
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)   PAGE ____OF ____

All facilities that handle hazardous materials must maintain records associated
with their management. A summary of your recordkeeping procedures is a required
module of the Hazardous Materials Business Plan (HMBP). A blank summary has been
provided below for you to complete and submit if you do not already have such a
document. IF YOU ALREADY HAVE A BRIEF WRITTEN DESCRIPTION OF YOUR HAZARDOUS
MATERIALS RECORDKEEPING SYSTEMS THAT ADDRESSES ALL SUBJECTS COVERED BELOW, YOU
ARE NOT REQUIRED TO COMPLETE THIS PAGE, BUT YOU MUST INCLUDE A COPY OF YOUR
EXISTING DOCUMENT AS PART OF YOUR HMBP.

Check all boxes that apply. The following records are maintained at the
facility. [Note: Items marked with an asterisk (*) are required.]:

[X]      Current employees' training records (to be retained until closure of
         the facility) *

[X]      Former employees' training records (to be retained at least three years
         after termination of employment) *

[X]      Training Program(s) (i.e. written description of introductory and
         continuing training) *

[X]      Current copy of this Emergency Response/Contingency Plan *

[X]      Record of recordable/reportable hazardous material/waste releases *

[X]      Record of hazardous material/waste storage area inspections *

[X]      Record of hazardous waste tank daily inspections *

[X]      Description and documentation of facility emergency response drills

Note: The above list of records does not necessarily identify every type of
record required to be maintained by the facility.

A COPY OF THE INSPECTION CHECK SHEET(S) OR LOG(S) USED IN CONJUNCTION WITH
REQUIRED ROUTINE SELF-INSPECTIONS OF YOUR FACILITY MUST BE SUBMITTED WITH YOUR
HMBP. (Exception: Available from your local agency is a Hazardous
Materials/Waste Storage Area Inspection Form that you may use if you do not
already have your own form. If you use the example provided, you do not need to
attach a copy.)

Check the appropriate box:

[X]      We will use the Unidocs "Hazardous Materials/Waste Storage Area
         Inspection Form" to document inspections.

[ ]      We will use our own documents to record inspections. (A BLANK COPY OF
         EACH DOCUMENT USED MUST BE ATTACHED TO THIS HMBP.)

<PAGE>

                                    EXHIBIT E

               ADDENDUM TO STANDARD INDUSTRIAL LEASE (THE "LEASE")
                    DATED THE 18TH DAY OF JULY, 2003 BETWEEN
              THE REALTY ASSOCIATES FUND III, L.P. ("LANDLORD") AND
                         CELERITY GROUP, INC. ("TENANT")

         It is hereby agreed by Landlord and Tenant that the provisions of this
Addendum are a part of the Lease. If there is a conflict between the terms and
conditions of this Addendum and the terms and conditions of the Lease, the terms
and conditions of this Addendum shall control. Capitalized terms in this
Addendum shall have the same meaning as capitalized terms in the Lease.

         1.       Termination of Existing Lease. Tenant presently occupies the
Premises pursuant to an existing lease (the "Existing Lease"), Prior to the
Commencement Date, the Existing Lease shall remain in full force and effect, and
Tenant shall perform all of its obligations under the Existing Lease. Landlord
and Tenant agree that upon the Commencement Date of this Lease, the term of the
Existing Lease will immediately end, and this Lease shall govern Landlord's and
Tenant's rights with respect to the Premises. Tenant shall continue to be
obligated to perform obligations under the Existing Lease that survive its
termination, including, but not limited to, indemnity obligations and
obligations to pay operating expenses and real property taxes.

         2.       Execution of 1463 Lease. Landlord's obligations under this
Lease are contingent and conditioned upon the concurrent execution and delivery
by Tenant and Landlord of a Standard Industrial Lease for the buildings located
at 1463 Centre Pointe Drive, Milpitas, California (the "1463 Lease").

         3.       Cross Default. At the sole option of Landlord, any default by
Tenant under the 1463 Lease shall be deemed to be a default under section
17.1(c) of this Lease, and in the event of such a default, Landlord shall have
all of the remedies available to it under this Lease. This Addendum section 3
shall be of no force or effect from and after the date that the real property
encumbered by the 1463 Lease is no longer owned by The Realty Associates Fund
III. L.P.

         4.       Base Rent Credit. Upon execution of this Lease, Tenant shall
receive a credit towards payment of the next due Base Rent under the Lease in
the amount of Twenty Thousand Two Hundred Eighty Four and 88/100 Dollars
($20,284.88).

         5.       Guaranty of Lease. Landlord's obligations under this Lease are
conditioned and contingent upon its receipt concurrently with Tenant's execution
and delivery of this Lease of a fully executed original of the Guaranty of Lease
attached to this Lease as Exhibit F.

         6.       Lender Approval. Landlord has obtained a loan (the "Loan")
from a lender (the "Lender") the repayment of which is secured by the Premises.
Tenant acknowledges that the terms and conditions of the Lease must be reviewed
and approved by the Lender. Landlord makes no representation or warranty to
Tenant that the Lender will approve the Lease. Landlord's obligations under the
Lease are contingent and conditioned upon the Lender's approval of the Lease.

         7.       Waiver Letter. Concurrently with the execution of this Lease,
and as a condition to Landlord's obligations under this Lease and the 1463
Lease, Tenant shall execute and deliver to Landlord the letter attached hereto
as Exhibit 1(the "Waiver Letter").

         8.       Tenant Property. Concurrently with the execution of this
Lease, and as a condition to Landlord's obligations under this Lease and the
1463 Lease, Tenant shall convey to Landlord good and marketable title to all of
the property described on Exhibit 2 attached hereto (the Tenant Property").
Tenant hereby represents and warrants to Landlord that the Tenant Property will
not be encumbered by any lien, lease or other encumbrance, and the failure of
this warranty to be true shall constitute a default by Tenant under section
17.1(c) of the Lease. Except as provided above, the Tenant Property shall be
delivered to Landlord in its "as is" condition. Provided that Tenant is not in
default under this Lease, so long as Tenant occupies the Premises, Tenant shall
have the right to use the Tenant Property. Tenant hereby agrees as follows (a)
Tenant shall not remove the Tenant Property from the Premises without Landlord's
prior written consent, which may be given or withheld in Landlord's sole
discretion, (b) Tenant has no ownership interest in the Tenant Property, and
Landlord shall retain title to and the ownership of the Tenant Property, (c)
Tenant shall operate and use the Tenant Property in accordance with the
specifications of the manufacturers of the Tenant Property and Tenant shall not
misuse the Tenant Property, (d) Tenant shall only use the Tenant Property in the
operation of its business at the Premises and for no other purpose, (e) Tenant
shall maintain and repair the Tenant Property at its sole cost and expense in
accordance with all of the maintenance and repair specifications of the
manufacturers of the Tenant Property and shall keep complete and accurate
records of all maintenance and repair work Tenant performs and shall provide
such records to Landlord on demand and (f) Tenant shall return the Tenant
Property to Landlord at the end of the term of this Lease in the condition
received, ordinary wear and tear excepted. Landlord shall have the right to
inspect the Tenant Property at any time upon reasonable advance notice to
Tenant. If Tenant fails to perform any of its obligations under this Addendum
section, Landlord shall notify Tenant of such failure. If Tenant fails to cure
such failure within ten (10) days of such notice (provided however, that if the
nature of the obligation is such that more than ten (10) days are reasonably
necessary to perform such obligation, Tenant shall not be in default if Tenant
commences performance within said ten (10) day period and thereafter diligently
pursues such cure to completion), then, in addition to any other remedies
available to Landlord for Tenant's default, Landlord shall have the immediate
right to take possession of the Tenant Property, in which event Tenant shall no
longer have the right to use the Tenant Property. Tenant shall be liable to
Landlord for all damages resulting from Tenant's failure to perform its
obligations under this Addendum section. Upon the termination of the Lease,
Tenant's right to use the Tenant Property shall immediately terminate, and
Tenant shall immediately return the Tenant Property to Landlord in the condition
required by this Addendum section. For purposes of section 19 of the Lease, any
Damages (as defined in section 19) arising out of or involving, directly or
indirectly, the use or existence of the Tenant Property shall be an "Indemnified
Matter". Tenant shall pay all sales taxes arising out of the transfer of the
Tenant Property to Landlord and all personal property taxes applicable to
Tenant's period of ownership, and Tenant's agreement to pay such taxes shall
constitute an Indemnified Matter in consideration of Landlord's agreement to
enter into the New Lease, Tenant has agreed to convey the Tenant Property to
Landlord. Landlord and Tenant acknowledge and agree that the value of the Tenant
Property is Twenty Five Thousand Dollars ($25,000).

         9.       Use of Premises. Tenant shall maintain the Premises in a neat
and orderly manner and shall continue its operations in the Premises in a manner
that is supportive of Landlord's efforts to lease the premises in accordance
with the Waiver Letter.

         10.      Abatement of Rent Due to Loss of Use of Premises. In the event
that Tenant is prevented from using, and does not use, the Premises or any
portion thereof, for five (5) consecutive business days or ten (10) days in any
twelve (12) month period (the "Eligibility Period") as a result of any damage or
destruction, to the Premises or any repair, maintenance or

<PAGE>

alteration performed by Landlord to the Premises after the Commencement Date and
required by the Lease, which substantially interferes with Tenant's use of the
Premises, or any failure to provide services or access to the Premises due to
Landlord's negligence or default, then Tenant's rent shall be abated or reduced,
as the case may be, after expiration of the Eligibility Period for such time
that Tenant continues to be so prevented from using, and does not use, the
Premises or a portion thereof, in the proportion that the rentable area of the
portion of the Premises that Tenant is prevented from using, and does not use,
bears to the total rentable area of the Premises. However, in the event that
Tenant is prevented from conducting, and does not conduct, its business in any
portion of the Premises for a period of time in excess of the Eligibility
Period, and the remaining portion of the Premises is not sufficient to allow
Tenant to effectively conduct its business therein, and if Tenant does not
conduct its business from such remaining portion, then for such time after
expiration of the Eligibility Period during which Tenant is so prevented from
effectively conducting its business therein, the rent for the entire Premises
shall be abated; provided, however, if Tenant reoccupies and conducts its
business from any portion of the Premises during such period, the rent allocable
to such reoccupied portion, based on the proportion that the rentable area of
such reoccupied portion of the Premises bears to the total rentable area of the
Premises, shall be payable by Tenant from the date such business operations
commence.

         11.      Monument Signs. Tenant presently has the right to use the
monument signs depicted on Exhibit 3 attached hereto pursuant to the Existing
Lease (the "Monument Signs"). From and after the Commencement Date of this
Lease, Tenant shall have no further right to use the Monument Signs. Within ten
(10) days after the Commencement Date, Tenant shall remove its name from both
Monument Signs and repair any damage caused by such removal.

         12.      Parking. At any time upon thirty (30) days advance written
notice to Tenant (the "Notice"), and notwithstanding anything to the contrary
contained in the Lease, Landlord shall have the right to require Tenant to use
the one hundred sixty five (165) parking spaces depicted on Exhibit 4 attached
hereto (the "Reserved Parking Spaces"). If Landlord elects to have Tenant use
the Reserved Parking Spaces, from and after the effective date of the Notice,
(a) Tenant shall be entitled to the exclusive use of the Reserved Spaces and (b)
Tenant shall not be entitled to use any other parking spaces at the Project.

         13,      Termination of Lease by Landlord. Landlord shall have the
right, in Landlord's sole and absolute discretion, to elect to terminate this
Lease (a "Landlord Termination") at any time on not less than thirty (30) days
advance written notice to Tenant (a "Landlord Termination Notice"). The date
specified in the Landlord Termination Notice for the termination of the Lease is
hereinafter referred to as the "Termination Date." In the event of a Landlord
Termination, (i) all rent payable under this Lease shall be paid through and
apportioned as of the Termination Date; (ii) neither party shall have any
rights, liabilities, or obligations under this Lease for the period accruing
after the Termination Date, except those which, by the provisions of this Lease,
expressly survive the expiration or termination of the term of this Lease; and
(iii) Tenant shall surrender and vacate the Premises and deliver possession
thereof to Landlord on or before the Termination Date in the condition required
under this Lease for surrender of the Premises.

         IN WITNESS WHEREOF, the parties hereto have respectively executed this
Addendum.

         LANDLORD:

The Realty Associates Fund III, L.P., a Delaware limited partnership

By:      Realty Associates Fund III GP Limited Partnership, a Delaware limited
           partnership, its general partner

         By:      Realty Associates Fund III LLC, a Delaware limited liability
                    company, its sole general partner

                  By:      Realty Associates Fund III Trust, a massachusetts
                             business trust, sole Member

                           By: /s/ Scott W. Amling
                               --------------------------------
                               (Officer) Regional Director

By:      Realty Associates Fund III Texas Corporation, a Texas corporation,
         general partner

By: /s/ Scott W. Amling
    --------------------------------
    (Officer) Regional Director

TENANT

Celerity Group,/lnc., a California corporation

By: /s/ John Goodman
    --------------------------------
        JOHN GOODMAN
   --------------------------------
             (print name)

Its: EXECUTIVE VICE PRESIDENT
     --------------------------------
            (print title)

By: /s/ John R. Ferron
    --------------------------------
        JOHN R. FERRON
    --------------------------------
              (print name)

Its:              CFO
     -------------------------------
              (print title)

<PAGE>

                              EXHIBIT 1 to Addendum

                                 (Waiver Letter)

<PAGE>

Mr. Randy Green
Celerity Group, Inc.
400 Parker Drive, Suite 1100
Austin, Texas 78728

         Re:      Assistance of Landlord in Leasing Premises.

Dear Randy:

         The Realty Associates Fund III, LP. ("Landlord") and Celerity Group,
Inc. ("Tenant") have entered into a Standard Industrial Lease (the "Lease") with
respect to 1507 and 1515 Centre Pointe Drive, Milpitas, California (the
"Premises"). Tenant has informed Landlord that it desires to sublease the
Premises. The term of the Lease expires on July 31, 2005 and Tenant is concerned
that it may be difficult to find a tenant willing to lease the Premises for such
a short period. Tenant believes that it will be easier to find a tenant to lease
the Premises if Landlord agrees to enter into a direct lease with the tenant.

         Tenant has requested that Landlord assist it in finding a tenant to
lease the Premises by permitting its brokers and/or property manager to market
the Premises for lease. In addition, Tenant has also requested that (a) Landlord
enter into direct negotiations with any prospective tenant for the lease of the
Premises and (b) if such negotiations are successful that Landlord attempt to
enter into a new written lease with the prospective tenant.

         Landlord is only willing to agree to Tenant's requests if Tenant agrees
that Landlord will have no liability of any type arising out its attempt to
lease the Premises.

         Tenant has agreed to proceed on this basis, and Landlord and Tenant
agree as follows:

         1.       Tenant Acknowledgements. Tenant acknowledges and agrees as
follows:

                  (a)      Although Landlord may attempt to market and lease the
Premises as provided in this agreement, Landlord has no obligation pursuant to
this agreement to assist Tenant in the marketing and/or leasing of the Premises.
Landlord may discontinue its marketing efforts at any time for any reason or no
reason. Tenant is solely responsible for marketing and subleasing the Premises
in accordance with the terms and conditions of the Lease, and nothing contained
in this agreement shall release Tenant from that obligation.

                  (b)      Landlord shall have no obligation to enter into a
direct lease with any prospective tenant. Landlord shall have the right at any
time, in its sole and absolute discretion, for any reason or no reason, to elect
not to enter into a direct lease with a prospective tenant.

                  (c)      Landlord makes no representation or warranty to
Tenant that it will find a new tenant to lease the Premises, will accept the new
tenant's credit or will be able to enter into an acceptable lease.

                  (d)      Landlord shall have no obligation to expend any money
or to incur any liability to market the Premises for lease or to lease the
Premises to a new tenant.

                  (f)      Landlord shall have no obligation to release tenant
from any of its obligations under the Lease.

                  (g)      As a condition to Landlord entering into a direct
lease, Landlord will require Tenant to pay a lease termination fee. Landlord
shall determine the amount of the lease termination fee in its sole and absolute
discretion. Tenant shall have the right to refuse to pay the lease termination
fee, but in this event Landlord shall have no obligation to proceed with its
efforts to lease the Premises.

<PAGE>

                  (h)      The Lease is in full force and effect, and Tenant
acknowledges that as of the date of this agreement Landlord is not in default
under the Lease and that Tenant has no claim against Landlord.

                  (i)      Tenant shall have no right to be involved in the
marketing of the Premises by Landlord's brokers and/or property manager, and
Landlord shall have no obligation to provide Tenant with any information
concerning its marketing efforts. In addition, Landlord shall have no obligation
to divulge to Tenant the status or content of any negotiations it has with a
prospective tenant or the terms and conditions of any lease it may enter into
with a prospective tenant, and Landlord shall have the right to treat all of
this information as confidential information.

                  (j)      Landlord's brokers and property manager are
Landlord's independent contractors, and are not Landlord's agents. Landlord's
brokers and property manager do not have right to act on Landlord's behalf or to
bind Landlord. Tenant shall not rely on any statement made by the brokers or
property manager. Landlord's brokers and property manager solely represent
Landlord and do not represent Tenant.

                  (k)      Notwithstanding anything to the contrary contained in
the Lease, Landlord, its property manager and its brokers shall have the right
to enter the Premises at any time without notice to Tenant to show the Premises
to prospective tenants or to otherwise further their marketing efforts.
Concurrently with its execution of this letter, Tenant shall provide Landlord
with copies of all of the keys to the Premises, all alarm codes and any other
information needed to gain access to or to operate the Premises. Tenant shall
not interfere with Landlord's efforts to market and lease the Premises. Landlord
shall exercise due care in safekeeping the keys, alarm codes and access codes
with respect to the foregoing. In addition, Landlord (or its brokers or property
manager) shall escort prospective tenants in the Premises so as not to unduly
cause risk of personal injury, theft or property damage to Tenant's property.

         2.       New Lease. The negotiations between Landlord and a prospective
tenant leading up to a new lease may be lengthy and complex. While Landlord and
the prospective tenant may reach agreement on one or more important issues,
Landlord shall not be bound by any agreement with a new tenant unless and until
a new written lease on terms and conditions acceptable to Landlord in its sole
and absolute discretion has been executed and delivered by Landlord and the new
tenant (a "New Lease").

         3.       Lease Termination Agreement. In order to enter into a New
Lease with a New Tenant, the Lease must be terminated. Consequently, if Landlord
elects to enter into a New Lease, Landlord and Tenant contemplate the concurrent
execution by Landlord and Tenant of a mutually acceptable lease termination
agreement (a "Lease Termination Agreement"). The terms and conditions of any
Lease Termination Agreement shall be satisfactory to Landlord and Tenant in each
of their sole and absolute discretions. Landlord shall have the right at any
time, in Landlord's sole discretion, for any reason or no reason, to elect not
to enter into a New Lease with a New Tenant and a Lease Termination Agreement
with Tenant. Nothing in this agreement shall be interpreted to obligate Landlord
to agree to the termination of the Lease.

         4.       No Waivers or Estoppel. No actions taken by Landlord pursuant
to this agreement shall (a) constitute a waiver of Landlord's rights under the
Lease or (b) shall estop Landlord from enforcing the terms and conditions of the
Lease. Tenant agrees that it will not rely on Landlord's marketing of the
Premises or Landlord's negotiations with prospective Tenants to mitigate its
losses. Tenant further acknowledges and agrees that Landlord's efforts to enter
into a direct lease with a prospective tenant may prevent Tenant from entering
into a sublease or lease assignment with the prospective tenant, and that
Landlord shall have no liability as a result thereof even if Landlord never
enters into a direct lease with such prospective tenant.

         5.       Alternative Opportunities. Because it is likely that no New
Lease will be entered into pursuant to this agreement, Tenant agrees not to
forego any attractive alternative opportunities to sublease the Premises, to
assign the Lease or to otherwise mitigate its losses; provided, however, that
Landlord shall have no obligation to approve any sublease or assignment except
as may be required by the Lease, and this agreement does not modify the
assignment and subleasing provisions of the Lease.

<PAGE>

         6.       Material Inducement. Tenant acknowledges that Landlord would
not have agreed to market the Premises and to negotiate with prospective tenants
unless Tenant had agreed to the terms and conditions of this agreement.

         7.       Miscellaneous. This agreement does not modify or amend the
Lease, and the Lease remains in full force and effect. This agreement shall
inure to the benefit of and be binding upon the parties hereto and their
respective heirs, successors and assigns, and shall be governed by California
law, without giving effect to principles of conflicts of laws. In the event of
any dispute hereunder, the prevailing party shall be entitled to recover all
costs and attorneys' fees from non-prevailing party. Paragraph headings used
herein are for convenience only and shall not be used to interpret any term
hereof. This agreement may be executed in one or more counterparts, each of
which shall constitute an original and all of which taken together shall
constitute one agreement. Each party executing this agreement represents that
such party has the full authority and legal power to do so. Should any provision
of this agreement require judicial interpretation, it is agreed that a court
interpreting or construing the same shall not apply a presumption that the terms
hereof shall be more strictly construed against any party by reason of the rule
of construction that a document is to be construed more strictly against the
party who itself or through its agents prepared same. Landlord shall have no
obligation to pay any commission or other compensation to any broker employed by
Tenant.

                  If the foregoing accurately summarizes the terms of our
binding agreement, please sign this letter in the space provided below and
return one copy to me.

                                       Sincerely yours,

LANDLORD:

The Realty Associates Fund III, L.P., a Delaware limited partnership

By:      Realty Associates Fund III GP Limited Partnership, a Delaware limited
           partnership, its general partner

         By:      Realty Associates Fund III LLC, a Delaware limited liability
                    company, its sole general partner

                  By:      Realty Associates Fund III Trust, a Massachusetts
                             business trust, sole Member

                           By: /s/ Scott W. Amling
                               --------------------------------
                               (Officer) Regional Director

By:      Realty Associates Fund III Texas Corporation, a Texas corporation,
         general partner

By: /s/ Scott W. Amling
    --------------------------------
    (Officer) Regional Director

AGREED AND CONSENTED TO:

TENANT

Celerity Group, Inc., a California corporation

BY: /s/ John Goodman
    -----------------------------
    John Goodman, Exec. V.P./ G.C.

<PAGE>

                             EXHIBIT "2" TO ADDENDUM
                     TENANT PROPERTY TRANSFERRED TO LANDLORD
                         (1507/1515 CENTRE POINTE DRIVE)

AREA AND DESCRIPTION (SEE REFERENCE MAP ON NEXT PAGE FOR AREA LOCATIONS)

 A. OFFICE AREAS (AREAS A ON REFERENCE MAP):

         All Tayco cubical work stations including: 158 lateral file cabinets,
         154 Pedestal file cabinets, 140 Stylex Workrite task chairs and all
         electrical supplied to work stations. Also includes 55 metal book
         shelves with sliding doors and 3 each 30" round tables, 6 each 42"
         round tables and 4 each 48" round tables.

B. BREAK ROOM (AREA B ON REFERENCE MAP):

         Includes 1 refrigerator, 1 dishwasher, 1 bulletin board and all
         attached countertops, cabinets and sink.

C. CONFERENCE ROOMS AND LOBBY (AREAS C ON REFERENCE MAP):

         Includes 1 each - 16'x 54" conference table, 10 each 10'x 54"
         conference tables, 9 each 4'x8' white boards, 1 each 4'x6' white board,
         and 100 each conference chairs.

D. COMMUNICATION CLOSETS (AREAS D ON REFERENCE MAP):

         Includes 6 each racks, 15 each patch panels and all installed cabling
         for voice and data.

E. CLEAN ROOM E (AREA E ON REFERENCE MAP):

         Includes the cleanroom and all equipment related to the operation of
         the clean room consisting of HVAC and all controls, all process
         plumbing already in place, and all electrical under the raised floor.
         Also includes 2 each "Clean Roll" automatic roll up doors.

F. CLEAN ROOM F (AREA F ON REFERENCE MAP):

         Includes the cleanroom and all equipment related to the operation of
         the clean room consisting of HVAC and all controls, all process
         plumbing already in place (16 each stations with plumbing for Nitrogen
         and Helium), all electrical (110V and 220V outlets at each of 16
         stations), and strip curtains on both sides running between the two
         automatic "Clean Roll" roll up doors.

G. WAREHOUSE (AREAS G ON REFERENCE MAP):

         Includes 2 each automatic roll up doors, all process plumbing up to the
         bulk gas connections (excluding process plumbing to 1463 Centre Pointe
         Drive), all process plumbing to the bulk bottle connections located
         inside warehouse area, 40' of 10' tall pallet racking, 24 each 12'x 4'x
         16" steel shelving, 18 each 12'x 4'x 24" steel shelving, 5 each 12'x
         6'x 4' steel shelving and 9 each 12' x 8'x 4' steel shelving.

GENERAL: Includes all "Trane" HVAC package units on the roof which consists of
         the following:

         1-RTU 18-4 ton unit

         3-RTU 9, 15 and 16 - 5 ton units

         2-RTU 7, 10-6 ton units

         4-RTU 1, 4, 5, and 12 - 7.5 ton units

         3-RTU 3, 6, and 17 - 8.5 ton units

         1-RTU 2-10ton unit

         4-RTU 8, 11, 13, and 14 - 15 ton units

         Also includes Trane Tracer Summit energy management system, components
         and software.

<PAGE>

                                  [FLOOR PLAN]

<PAGE>

                                   EXHIBIT 3

                                  [FLOOR PLAN]

<PAGE>

                              EXHIBIT 4 to Addendum

                            (Reserved Parking Spaces)

<PAGE>

                                   Exhibit F

<PAGE>

                                GUARANTY OF LEASE

         This Guaranty of Lease (the "Guaranty") is given by Kinetics Group,
Inc., a Delaware corporation ("Guarantor"), to the Realty Associates Fund III,
L.P., a Delaware limited partnership ("Landlord"), in order to guaranty the
performance of all obligations of Celerity Group, Inc., a California corporation
("Tenant") under that certain lease (the "Lease") entered into by Landlord and
Tenant for the lease of the real property commonly known as 1507 and 1515 Centre
Pointe, Milpitas, California ("Premises").

         As a material inducement to and in consideration of Landlord's entering
into the Lease, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Guarantor hereby covenants and
agrees with Landlord as follows:

         1.       SCOPE OF GUARANTY. Guarantor hereby unconditionally and
irrevocably guarantees all of Tenant's obligations under the Lease, provided
that Landlord has given to Tenant such notice(s) and period(s) of cure, if any,
as are required to be given by Landlord to Tenant under the Lease (the
"Obligations") including but not limited to: (a) Tenant's payment of all rent,
monies and charges payable under the Lease in the manner specified thereunder;
(b) Tenant's performance of each of the covenants contained in the Lease to be
kept, performed or observed by Tenant; and (c) Tenant's payment of all damages
owing to Landlord under the Lease following a default by Tenant under the Lease.
Guarantor acknowledges that this is a guaranty of payment and performance of all
Obligations and not merely a guaranty of collectibility.

         2.       TERM OF GUARANTY. This Guaranty and the obligations of
Guarantor hereunder shall be continuing and irrevocable until Tenant has
performed all of its Obligations under the Lease, including those which survive
the expiration or earlier termination of the Lease. If all or any portion of the
Obligations are paid or performed, Guarantor's obligations hereunder shall
continue and remain in full force and effect in the event that all or any part
of such payment or performance is avoided or recovered directly or indirectly
from Landlord as a preference, fraudulent transfer or otherwise. This Guaranty
and the obligations of Guarantor hereunder shall continue during any option
period, extended term or renewal period.

         3.       WAIVERS. Guarantor hereby waives its right to assert any
defense to its liability under this Guaranty based on (a) Guarantor's right to
require Landlord to proceed against Tenant or a co-guarantor or to proceed
against or exhaust any security held by Landlord at any time; (b) any defense
that may arise by reason of the incapacity, lack of authority, death or
disability of any other person or persons or the failure of Landlord to file or
enforce a claim against the estate (in administration, bankruptcy or any other
proceeding) of any other person or persons; (c) any defense based upon an
election of remedies by Landlord, including any election which destroys or
impairs any right of subrogation, reimbursement or contribution which Guarantor
may have; (d) any duty on the part of Landlord to disclose to Guarantor any
facts Landlord may now or hereafter know about Tenant, it being understood and
agreed that Guarantor is fully responsible for becoming and remaining informed
of the financial condition of Tenant and of any and all circumstances bearing on
the risk of nonperformance of any Obligation; (e) any rights or benefits in
favor of Guarantor under Sections 2809, 2810, 2815, 2819, 2839, 2845, 2848, 2849
or 2850 of the California Civil Code or under 11 U.S.C. Sections 364 or 1111(b),
or any amendment to any of the forgoing statutes; (f) any transfer of
Landlord's interest in the Premises or the assignment of Landlord's interest in
the Lease; (g) any transfer of Tenant's interest as tenant under the Lease or
any portion thereof or any sublease or assignment by Tenant; (h) any merger or
consolidation of Tenant or sale of all or a substantial portion of Tenant's
assets; (i) any sale of all or any portion of any capital stock of Tenant or
partnership interest in Tenant owned by Guarantor; or (j) any prior or
concurrent representation, understanding, promise or condition concerning the
subject matter hereof which is not expressed herein. Guarantor hereby waives all
presentments, protests, notices of protest, notices of dishonor and notices of
acceptance of this Guaranty by Landlord, and this Guaranty shall be binding upon
Guarantor immediately upon its delivery to Landlord; provided that the foregoing
shall not waive or release any obligation of Landlord to provide notice to
Tenant (or its successors or assigns) and any required period of cure in
accordance with and to the extent required by the Lease.

         4.       Wo DISCHARGE OF GUARANTOR. Guarantor's liability under this
Guaranty shall not be deemed to have been waived, released, discharged, limited,
impaired or affected by reason of (a) the expiration or termination of the
Lease; (b) the release or discharge of Tenant in any receivership, bankruptcy or
other creditors' proceedings or the rejection, disaffirmance or disclaimer of
the Lease by any party in any such proceeding; (c) the repossession of the
Premises; or (d) any waiver by Landlord of any provisions of the Lease or any
failure by Landlord to enforce the provisions thereof. Guarantor hereby assigns
to Landlord any rights Guarantor may have to file a claim and proof of claim in
any bankruptcy or

<PAGE>

similar proceeding of Tenant and any awards or payments thereon to which
Guarantor would otherwise be entitled, to the extent of any unsatisfied
Obligation. No amendment or modification of the Lease shall be binding on
Guarantor unless Guarantor has consented to such amendment or modification.
Guarantor shall be deemed to have consented to an amendment or modification of
the Lease if Guarantor does not provide written notice to Landlord and Tenant
objecting to the amendment or modification within three (3) business days after
Landlord or Tenant notifies Guarantor of the proposed amendment or modification
in the manner described in section 16 below.

         5.       CUMULATIVE RIGHTS. The amount of Guarantor's liability and all
rights, powers and remedies of Landlord hereunder shall be cumulative and not
alternative and such rights, powers and remedies shall be in addition to all
rights, powers and remedies available to Landlord at law or in equity. In the
event of any default hereunder, a separate action or actions may be brought and
prosecuted against Guarantor, whether or not Tenant is joined in the action and
whether or not a separate action is brought against Tenant. Landlord may
maintain successive actions for other defaults.

         6.       SUBORDINATION OF RIGHTS. Guarantor hereby subordinates any and
all claims it may have against Tenant to Landlord's claims under the Lease.

         7.       ATTORNEYS' FEES AND EXPENSES. The prevailing party shall pay,
upon demand, reasonable attorneys' fees and all costs and other expenses which
the other party expends or incurs in enforcing or defending against this
Guaranty or which Landlord incurs in connection with any insolvency, bankruptcy,
reorganization, arrangement or other similar proceedings involving Tenant,
Guarantor, or either of them.

         8.       INTEREST. Any amounts payable fay Guarantor hereunder that are
not paid when due shall bear interest at the lesser of (a) eight percent (8%)
per annum or (b) the maximum amount permitted by applicable law.

         9.       SEVERABILITY. Should any provision of this Guaranty be
determined to be illegal or unenforceable by a court of competent jurisdiction,
all other provisions hereof shall nevertheless be deemed effective.

         10.      MODIFICATION. No provision of this Guaranty or right of
Landlord hereunder may be modified or waived, nor shall Guarantor be released
from performance of Guarantor's obligations hereunder, except by a writing duly
executed by Landlord.

         11.      ASSIGNMENT AND INTERPRETATION. This Guaranty shall inure to
the benefit of and bind the heirs, legal representatives, administrators,
executors, successors and assigns of Guarantor and of Landlord. The assignment
of the Guaranty by Landlord shall not extinguish or diminish Guarantor's
liability hereunder. The use of the word Guarantor shall include the plural as
well as the singular. Words used in the neuter gender shall include the
masculine and feminine gender.

         12.      EFFECT OF GUARANTOR'S PERFORMANCE OF OBLIGATIONS. The
acceptance by Landlord of the performance of any of the Obligations under the
Lease by Guarantor, including, without limitation, the acceptance of rent
payments, shall constitute neither an assignment of the Lease to Guarantor nor
Landlord's consent to such an assignment.

         13.      ESTOPPEL CERTIFICATE. Guarantor, from time to time within ten
(10) business days following Landlord's written request, shall execute and
deliver to Landlord an estoppel certificate containing such truthful information
as Landlord may reasonably request, and such further instruments or
documentation as may reasonably be requested by Landlord to ratify and confirm
this Guaranty and the continuing liability of Guarantor hereunder. In addition,
at Landlord's request, from time to time, Guarantor shall furnish to Landlord
its most recent audited financial statement.

         14.      GOVERNING LAW AND VENUE. This Guaranty shall be governed by
and construed in accordance with the laws of the State of California (without
regard to California's conflicts of law rules). The parties hereby consent to
jurisdiction and venue in any California court of competent jurisdiction or the
United States District Court for the county and federal judicial district,
respectively, in which the Premises are located, and agree that such courts
shall constitute the exclusive venue for any dispute arising hereunder.

<PAGE>

         15.      ENTIRE AGREEMENT. This Guaranty contains all of the agreements
of Landlord and Guarantor concerning the guaranty of the Lease and no prior or
contemporaneous agreement! or understanding pertaining to any such matter shall
be effective.

         16.      NOTICES. Any notice given hereunder shall be in writing and
may be given by certified mail, return receipt requested, personal delivery,
Federal Express or other delivery service. If notice is given by certified mail,
return receipt requested, notice shall be deemed given three {3} days after the
notice has been deposited in the U.S. mail, postage pre-paid, addressed to
Guarantor at the address set forth opposite its signature on the last page of
this Guaranty and addressed to Landlord at the address for notices for Landlord
set forth in the Lease. If notice is given by personal delivery, Federal Express
or other delivery service, notice shall be deemed given on the date the notice
is actually received by Landlord or Guarantor. Either party may, by written
notice to the other party, specify a different address for notice purposes.

         17.      AUTHORITY. If Guarantor is a corporation, trust, or general or
limited partnership, Guarantor, and each individual executing this Guaranty on
behalf of such entity, represents and warrants that such individual is duly
authorized to execute and deliver this Guaranty on behalf of said entity, that
said entity is duly authorized to enter into this Guaranty, and that this
Guaranty is enforceable against said entity in accordance with its terms. If
Guarantor is a corporation, trust or partnership, Guarantor shall deliver to
Landlord upon demand evidence of such authority satisfactory to Landlord. \

         18.      JOINT AND SEVERAL LIABILITY. If more than one person or entity
executes this Guaranty, the obligations of each person or entity executing this
Guaranty shall be joint and several.

         19.      WAIVER OF JURY TRIAL. LANDLORD AND GUARANTOR HEREBY WAIVE
THEIR RESPECTIVE RIGHT TO TRIAL BY JURY OF ANY CAUSE OF ACTION, CLAIM,
COUNTERCLAIM OR CROSS-COMPLAINT IN ANY ACTION, PROCEEDING AND/OR HEARING BROUGHT
BY EITHER LANDLORD AGAINST GUARANTOR OR GUARANTOR AGAINST LANDLORD ON ANY MATTER
WHATSOEVER ARISING OUT OF, OR IN ANY WAY CONNECTED WITH, THIS GUARANTY, THE
LEASE, THE RELATIONSHIP OF LANDLORD AND GUARANTOR, TENANT'S USE OR OCCUPANCY OF
THE PREMISES, OR ANY CLAIM OF INJURY OR DAMAGE, OR THE ENFORCEMENT OF ANY REMEDY
UNDER ANY LAW, STATUTE, OR REGULATION, EMERGENCY OR OTHERWISE, NOW OR HEREAFTER
IN EFFECT.

         GUARANTOR ACKNOWLEDGES THAT IT WAS AFFORDED THE OPPORTUNITY TO READ
THIS GUARANTY AND TO REVIEW IT WITH AN ATTORNEY OF ITS CHOICE. GUARANTOR
ACKNOWLEDGES HAVING READ AND UNDERSTOOD THIS GUARANTY AND THE LEASE BEFORE
SIGNING THIS GUARANTY.

         IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the date
written below.

         DATED: ___________________             GUARANTOR:

                                                Kinetics Group, Inc. a Delaware
                                                corporation

ADDRESS OF GUARANTOR:

Kinetics Group, Inc., a Delaware corporation    By: /s/ [ILLEGIBLE]
2805 Mission College Boulevard                      ----------------------------
Santa Clara, California 95054                       John Goodman
Attention: John Goodman, General Counsel                   (print name)
                                                Its: Executive Vice President
                                                     ---------------------------
                                                           (print title)

                                                By: ____________________________
                                                    John R. Ferron
                                                            (print name)
                                                Its:  CFO
                                                      --------------------------
                                                            (print title)<PAGE>
                                                                               .
                                                                               .
                                                                               .
                                                                   Exhibit 10.09

                           STANDARD INDUSTRIAL LEASE

<TABLE>
<S>      <C>                                                        <C>
1.       BASIC LEASE PROVISIONS.

         1.1      DATE:                                             July 18, 2003

         1.2      LANDLORD:                                         The Realty Associates Fund III, L.P., a
                                                                    Delaware limited partnership

         1.3      TENANT:                                           Celerity Group, Inc., a California
                                                                    corporation

         1.4      PREMISES ADDRESSES:                               1463 Centre Pointe Drive, Milpitas,
                                                                    California (LFN:K 100-129)

         1.5      APPROXIMATE LEASABLE AREA
                  OF PREMISES:                                      47,994
                  (In square feet)

         1.6      USE:                                              Office, engineering, sales, storage and light manufacturing and
                                                                    other legal uses related to Celerity Group, Inc.'s present
                                                                    operations in the Premises, so long as none of the above uses
                                                                    Involve Hazardous Materials (as defined below) except as
                                                                    expressly permitted by the terms of this Lease

         1.7      TERM:                                             Commencement Date through July 31, 2009

         1.8      COMMENCEMENT DATE:                                Upon mutual execution of this Lease by
                                                                    Landlord and Tenant

         1.9      MONTHLY BASE RENT:                                Commencement Date through July 31, 2003: $58,552.68;
                                                                    August 1, 2003 through July 31, 2004: $47,994.00;
                                                                    August 1, 2004 through July 31, 2005: $50,393.70;
                                                                    August 1, 2005 through July 31, 2006: $52,913.39;
                                                                    August 1, 2006 through July 31, 2007: $55,559,05;
                                                                    August 1, 2007 through July 31, 2008: $58,337.01 ;and
                                                                    August 1, 2008 through July 31, 2009: $61,253.86.

         1.10     BASE RENT PAID UPON EXECUTION:                    None

                           APPLIED To:                              N/A
                           (Insert month(s))

         1.11     TENANT'S PERCENTAGE SHARE:                        23.13%
                  (See also section 6.4)

         1.12     SECURITY DEPOSIT:                                 None

         1.12.5   LETTER OF CREDIT:                                 See Addendum

         1.13     NUMBER OF PARKING SPACES:                         166

         1.14     REAL ESTATE BROKER:

                           LANDLORD:                                Insignia ESG

                           TENANT:                                  None

         1.15     EXHIBITS ATTACHED TO LEASE:                       Exhibit A - "Premises;"Exhibit B - Intentionally deleted
                                                                    Exhibit C - "Rules and Regulations;" Exhibit D - "Form of HazMat
                                                                    Certificate"; Exhibit E - "Addendum to Lease";
                                                                    Exhibit F - "Guaranty of Lease"

         1.16     ADDRESSES FOR NOTICES:

                           LANDLORD:                                c/o TA Associates Realty
                                                                    1301 Dove Street, Suite 860
                                                                    Newport Beach, California 92660
                                                                    Attention: Asset Manager

                           WITH A COPY TO:                          Insignia ESG
                                                                    160 W. Santa Clara Street, 12th Floor
                                                                    San Jose, California 95113
                                                                    Attention: Property Manager

                           TENANT:                                  Celerity Group, Inc., a California corporation
                                                                    1463 Centre Pointe Drive
                                                                    Milpitas, California 95035
                                                                    Attention: Will Seppi

                           WITH A COPY TO:                          Celerity Group, Inc.
                                                                    400 Parker Drive, Suite 1100
                                                                    Austin, Texas 78728
                                                                    Attention: Randy Green

                           GUARANTOR:                               Kinetics Group, Inc., a Delaware corporation
                                                                    2805 Mission College Boulevard
                                                                    Santa Clara, California 95054
                                                                    Attention: John Goodman, General Counsel
</TABLE>

<PAGE>

2.       PREMISES.

         2.1      ACCEPTANCE. Landlord leases to Tenant, and Tenant leases from
Landlord, the Premises, to have and to hold for the term of this Lease, subject
to the terms, covenants and conditions of this Lease. The Premises is depicted
on Exhibit "A" attached hereto. The Premises depicted on Exhibit "A" is all or a
part of a building (the "BUILDING") and may contain areas outside of the
Building to the extent such areas are specifically identified on Exhibit "A" as
being a part of the Premises. Tenant accepts the Premises in its condition as of
the Commencement Date, subject to all applicable laws, ordinances, regulations,
covenants, conditions, restrictions and easements in existence on the
Commencement Date, and except as may be otherwise expressly provided herein,
Landlord shall not be obligated to make any repairs or alterations to the
Premises. Tenant acknowledges that Landlord has made no representation or
warranty as to the suitability of the Premises for the conduct of Tenant's
business, and Tenant waives any implied warranty that the Premises are suitable
for Tenant's intended purposes. The number of square feet set forth in section
1.5 is an approximation, and the Base Rent shall not be changed if the actual
number of square feet in the Premises is different than the number of square
feet set forth in section 1.5.

         2.2      COMMON AREAS. Landlord hereby grants to Tenant for the benefit
of Tenant and its employees, suppliers, shippers, customers and invitees during
the term of this Lease, the nonexclusive right to use, in common with others
entitled to such use (including Landlord), the Common Areas (as hereinafter
defined) as they exist from time to time, subject to all rights reserved by
Landlord hereunder and under the terms of all rules and regulations promulgated
by Landlord from time to time with respect thereto. Landlord reserves the right
from time to time to (a) make changes in the Common Areas, including, without
limitation, changes in location, size, shape and number of driveways, entrances,
parking spaces, parking areas, loading and unloading areas, ingress, egress,
direction of traffic, landscaped areas and walkways; (b) close temporarily any
of the Common Areas for maintenance purposes so long as reasonable access to the
Premises remains available; (c) construct additional buildings, parking areas,
loading dock facilities and other improvements within the Common Areas; and (d)
do and perform such other acts and make such other changes in, to or with
respect to the Common Areas as Landlord may deem appropriate. As used herein,
the term "COMMON AREAS" means all areas and facilities outside the Premises and
within the exterior boundary lines of the land owned by Landlord that are
provided and designated by Landlord as such from time to time for general
nonexclusive use of Tenant and others, including, if designated by Landlord as
Common Areas, parking areas, loading and unloading areas, trash areas, roadways,
sidewalks, walkways, parkways and landscaped areas. The Premises, the Building,
the Common Areas, the land upon which the same are located, along with all other
buildings and improvements thereon, are herein collectively referred to as the
"PROJECT." Under no circumstances shall the right herein granted to use the
Common Areas be deemed to include the right to store any property, temporarily
or permanently, in the Common Areas, including, without limitation, the storage
of trucks or other vehicles. Any such storage shall be permitted only by the
prior written consent of Landlord, which consent may be revoked at any time. In
the event that any unauthorized storage shall occur then Landlord shall have the
right, after giving Tenant ten (10) days advance written notice, in addition to
such other rights and remedies that it may have, to remove the property and
charge the cost to Tenant, which cost shall be immediately payable upon demand
by Landlord. Notwithstanding the forgoing, Tenant shall have the right to
temporarily store small amounts of materials in the back of the Premises to
facilitate the transfer of materials to and from the Premises ("TEMPORARY
TRANSFER STORAGE") provided such Temporary Transfer Storage (a) complies with
all of Landlord's reasonable requirements (including, but not limited to, the
location of the storage) and (b) such storage is permitted by and complies with
all applicable laws, regulations and covenants, conditions and restrictions
applicable to the outside storage or the Project. Temporary Transfer Storage
shall only occur occasionally and shall not result in the storage of materials
outside the Premises for more than fifteen (15) days at any one time. It is the
intent of Landlord and Tenant that there be no Temporary Outside Storage at most
times.

3.       TERM.

         3.1      TERM AND COMMENCEMENT DATE. The term and Commencement Date of
this Lease are as specified in sections 1.7 and 1.8.

         3.2      Intentionally deleted.

         3.3      Intentionally deleted .

         3.4      Intentionally deleted.

         3.5      Intentionally deleted.

4.       USE.

         4.1      PERMITTED USE. The Premises shall be used only for the purpose
described in section 1.6 and for no other purpose. Landlord makes no
representation or warranty that Tenant's use is permitted by applicable zoning
laws or other laws and regulations. In no event shall any portion of the
Premises be used for retail sales. Tenant shall not initiate, submit an
application for, or otherwise request, any land use approvals or entitlements
with respect to the Premises or any other portion of the Project, including,
without limitation, any variance, conditional use permit or rezoning ("Land Use
Approvals"), without first obtaining Landlord's prior written consent which may
be given or withheld in Landlord's sole discretion (the foregoing shall not be
interpreted to prohibit Tenant from obtaining permits for its operations which
do not constitute Land Use Approvals). Tenant shall not (a) permit any animals
or pets to be brought to or kept in the Premises, (b) install any antenna, dish
or other device on the roof of the Building or outside of the Premises, (c) make
any penetrations into the roof of the Building, (d) place loads upon floors,
walls or ceilings in excess of the load such items were designed to carry, (e)
except for the Temporary Transfer Storage, place or store, nor permit any other
person or entity to place or store, any property, equipment, materials, supplies
or other items outside of the Building in which the Premises is located or (f)
change the exterior of the Premises or the Building In which the Premises Is
located.

         4.2      COMPLIANCE WITH LAWS. Tenant shall, at Tenant's sole expense,
promptly comply with all applicable laws, ordinances, rules, regulations,
orders, certificates of occupancy, conditional use or other permits, variances,
covenants, conditions, restrictions, easements, the recommendations of
Landlord's engineers or other consultants, and requirements of any fire
insurance underwriters, rating bureaus or government agencies, now in effect or
which may hereafter come into effect, whether or not they reflect a change in
policy from that now existing, during the term or any part of the term hereof,
relating in any manner to the occupation and use by Tenant of the Premises.
Tenant shall, at Tenant's sole expense, comply with all requirements of the
Americans With Disabilities Act that relate to the Promises, and all federal,
state and local laws and regulations governing occupational safety and health.
Tenant shall not permit any objectionable or unpleasant odors, smoke, dust, gas,
noise or vibrations to emanate from the Premises, or take any other action that
would constitute a nuisance or would disturb, unreasonably interfere with or
endanger Landlord or any other tenants of the Project. Tenant shall obtain, at
its sole expense, any permit or other governmental authorization required to
operate its business from the Premises. Landlord shall not be liable for the
failure of any other tenant or person to abide by the requirements of this
section or to otherwise comply with applicable laws and regulations, and Tenant
shall not be excused from the performance of its obligations under this Lease
due to such a failure. Tenant acknowledges that the leases of other tenants may
not obligate them to comply with some or all of the requirements of this
section. However, if the lease of another tenant does obligate the tenant to
comply with a requirement of this section, and the tenant's failure to comply
with such requirement is having a

                                       2
<PAGE>

material adverse effect on Tenant's use of the Premises, Landlord shall
cooperate with Tenant in attempting to cause the tenant to comply with the
requirement, provided, however, Landlord shall have no obligation to bring a
legal action against the non-complying tenant.

5.       BASE RENT. Tenant shall pay Base Rent in the amount set forth on the
first page of this Lease. The first month's Base Rent, the Security Deposit, and
the first monthly installment of estimated Operating Expenses (as hereafter
defined) shall be due and payable on the date this Lease is executed by Tenant,
and Tenant promises to pay to Landlord in advance, without demand, deduction or
set-off, monthly installments of Base Rent on or before the first day of each
calendar month succeeding the Commencement Date. Payments of Base Rent for any
fractional calendar month shall be prorated. All payments required to be made by
Tenant to Landlord hereunder shall be payable at such address as Landlord may
specify from time to time by written notice delivered in accordance herewith.
Tenant shall have no right at any time to abate, reduce, or set off any rent due
hereunder except where expressly provided in this Lease.

6.       OPERATING EXPENSE PAYMENTS.

         6.1      OPERATING EXPENSES. Tenant shall pay Tenants Percentage Share
(as defined below) of the Operating Expenses for the Project to the extent such
Operating Expense relate directly to the Project. For the purposes of this
Lease, the term "OPERATING EXPENSES" shall mean all expenses and disbursements
of every kind (subject to the limitations set forth below) which Landlord
incurs, pays or becomes obligated to pay in connection with the ownership,
operation, and maintenance of the Project (including the associated Common
Areas), including, but not limited to, the following:

                  (a)      a reasonable management fee intended to cover
management fees and wages and salaries of all employees, agents, consultants
and other individuals or entities engaged in the operation, repair, replacement,
maintenance, and security of the Project, including taxes, insurance and
benefits relating thereto;

                  (b)      all supplies and materials used in the operation,
maintenance, repair, replacement, and security of the Project;

                  (c)      annual cost of all Capital Improvements (amortized
over the useful economic life of such improvements as determined by Landlord in
its reasonable discretion (without regard to the period over which such
improvements may be depreciated or amortized for federal income tax purposes).
Capital Improvements shall not include any expenditure incurred by Landlord to
maintain the structural elements of the roof of the Building (excluding the roof
membrane), the structural soundness of the foundation of the Building, the
structural elements of the exterior walls of the Building and the structural
elements of existing interior load bearing walls of the Building (excluding any
load bearing walls constructed by Tenant, which Tenant shall maintain and repair
at Tenant's sole expense), and the cost of such items shall be paid by Landlord,
at Landlord's sole cost and expense;

                  (d)      cost of all utilities paid by Landlord;

                  (e)      cost of any insurance or insurance related expense
applicable to the Project (excluding any insurance deductible except as
expressly permitted by section 6.2 below) and Landlord's personal property used
in connection therewith, including, but not limited to, the insurance costs
described in section 10.2;

                  (f)      cost of repairs, replacements and general maintenance
of the Project (including all truck court areas, paving and parking areas,
Common Area lighting facilities, fences, gates, water lines, sewer lines, rail
spur areas and any other item Landlord is obligated to repair or maintain),
other than costs necessary to assure the structural soundness of the roof,
foundation and exterior walls of the Project or any other costs which are
payable solely by Landlord under section 11.1;

                  (g)      cost of service or maintenance contracts with
independent contractors for the operation, maintenance, repair, replacement or
security of the Project (including, without limitation, alarm service, exterior
painting, trash collection, snow, ice, debris and waste removal and landscape
maintenance);

                  (h)      the cost of all accounting fees, management fees,
legal fees and consulting fees attributable to the operation, ownership,
management, maintenance or repair of the Project;

                  (i)      payments made by Landlord under any easement,
license, operating agreement, declaration, restrictive covenant or other
agreement relating to the sharing of costs among property owners;

                  (j)      Intentionally deleted.

                  (k)      the cost of all business licenses, permits or similar
fees relating to the operation, ownership, repair or maintenance of the Project;
and

                  (l)      the cost of any other item the cost of which is
stated in this Lease to be an Operating Expense.

For purposes of this Lease, a "CAPITAL IMPROVEMENT" shall be an improvement to
the Project that Landlord is obligated to make pursuant to this Lease, the cost
of which is not fully deductible in the year incurred in accordance with
generally accepted accounting principles ("GAAP"); provided, however, that, at
Landlord's option, the cost of painting all or part of the Project shall be
treated as an expense and not as a Capital Improvement. Real Property Taxes (as
defined below) shall be reimbursed to Landlord as provided below and shall not
be treated as an Operating Expense. References to facilities, services,
utilities or other items in this section shall not impose an obligation on
Landlord to have said facilities or to provide said services unless such
facilities and services already exist at the Project.

         6.2      OPERATING EXPENSE EXCLUSIONS. Notwithstanding anything to the
contrary contained herein, for purposes of this Lease, the term "OPERATING
EXPENSES" shall not include the following: (i) costs (including permit, license
and inspection fees) incurred for tenant improvements for other tenants within
the Project; (ii) legal and auditing fees (other than those fees reasonably
incurred in connection with the maintenance and operation of all or any portion
of the Project), leasing commissions, advertising expenses and similar costs
incurred in connection with the leasing of the Project; (iii) depreciation of
the Building or any other improvements situated within the Project; (iv) any
items for which Landlord is actually reimbursed by insurance or by direct
reimbursement by any other tenant of the Project; (v) costs of repairs or other
work necessitated by fire, windstorm or other casualty (excluding any
deductibles) and/or costs of repair or other work necessitated by the exercise
of the right of eminent domain to the extent insurance proceeds or a
condemnation award, as applicable, is actually received by Landlord for such
purposes; provided, such costs of repairs or other work shall be paid by the
parties in accordance with the provisions of sections 11 and 12, below; (vi)
other than any interest charges for Capital Improvements referred to in section
6.1(c) hereinabove, any interest or payments on any financing for the Building
or the Project and interest and penalties incurred as a result of Landlord's
late payment of any invoice; (vii) costs associated with the investigation
and/or remediation of Hazardous Materials (hereafter defined) present in, on or
about any portion of the Project, unless such costs and expenses are the
responsibility of Tenant as provided in section 27 hereof, in which event such
costs and expenses shall be paid solely by Tenant in accordance with the
provisions of section 27 hereof; (viii) overhead and profit increment paid to

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<PAGE>

Landlord or to subsidiaries or affiliates of Landlord for goods and/or services
in the Project to the extent the same exceeds the costs of such by unaffiliated
third parties on a competitive basis; (ix) any payments under a ground lease or
master lease; (x) except as provided in section 6.1(c) above, the cost of
Capital Improvements and (xi) the cost of any insurance deductibles to the
extent such deductibles exceed $50,000 in any one year.

         6.3      PAYMENT. Tenant's Percentage Share of Operating Expenses shall
be payable by Tenant within fifteen (15) days after a reasonably detailed
statement of actual expenses is presented to Tenant by Landlord. At Landlord's
option, however, Landlord may, from time to time, estimate what Tenant's
Percentage Share of Operating Expenses will be, and the same shall be payable by
Tenant monthly during each calendar year of the Lease term, on the same day as
the Base Rent is due hereunder. In the event that Tenant pays Landlord's
estimate of Tenant's Percentage Share of Operating Expenses, Landlord shall use
its best efforts to deliver to Tenant within one hundred fifty (150) days after
the expiration of each calendar year a reasonably detailed statement (the
"STATEMENT") showing Tenant's Percentage Share of the actual Operating Expenses
incurred during such year. If Landlord has not delivered a Statement to Tenant
within one hundred fifty (150) days after the expiration of the preceding
calendar year, Tenant shall have the right to give Landlord written notice of
such failure (a "TENANT NOTICE"), and Landlord's failure to provide the
Statement to Tenant within thirty (30) days after Landlord receives the Tenant
Notice shall be a default by Landlord under this Lease. To be effective, the
Tenant Notice must specifically state that Landlord's failure to provide the
Statement to Tenant within thirty (30) days after Landlord's receipt of the
Notice will constitute a default and the Tenant Notice must refer specifically
to this section of the Lease. Landlord's failure to deliver the Statement to
Tenant within said period shall not constitute Landlord's waiver of its right to
collect said amounts or otherwise prejudice Landlord's rights hereunder;
provided, however, Landlord shall not have the right to collect from Tenant any
Operating Expense that was known by Landlord and which was not billed to Tenant
within one year after the expiration of the calendar year in which the Operating
Expense was incurred. If Tenant's payments under this section during said
calendar year exceed Tenant's Percentage Share as indicated on the Statement,
Tenant shall be entitled to credit the amount of such overpayment against
Tenant's Percentage Share of Operating Expenses next falling due. If Tenant's
payments under this section during said calendar year were less than Tenant's
Percentage Share as indicated on the Statement Tenant shall pay to Landlord the
amount of the deficiency within thirty (30) days after delivery by Landlord to
Tenant of the Statement. Landlord and Tenant shall forthwith adjust between them
by cash payment any balance determined to exist with respect to that portion of
the last calendar year for which Tenant is responsible for Operating Expenses,
notwithstanding that the Lease term may have terminated before the end of such
calendar year; and this provision shall survive the expiration or earlier
termination of the Lease.

         6.4      TENANT'S PERCENTAGE SHARE. TENANT'S PERCENTAGE SHARE" as used
in this Lease shall mean the percentage of the cost of Operating Expenses and
Real Property Taxes (as defined below) for which Tenant is obligated to
reimburse Landlord pursuant to this Lease. Notwithstanding anything to the
contrary contained in section 1.11, Landlord shall have the right to determine
Tenant's Percentage Share of the cost of Operating Expenses and Real Property
Taxes using any one or more of the following three methods, and Tenant hereby
agrees that any one of the following three methods of allocation is reasonable:
(a) by multiplying the cost of all Operating Expenses or Real Property Taxes by
a fraction, the numerator of which is the number of square feet of leasable
space in the Premises and the denominator of which is the number of square feet
of leasable space in all buildings in the Project from time to time (e.g., if
Landlord sold one of the buildings that now comprises the Project, this
reduction in Project square footage shall be taken into consideration in
determining Tenant's Percentage Share of the Project); or (b) (i) with respect
to an Operating Expense or Real Property Taxes attributable solely to the
Building, requiring Tenant to pay that portion of the cost of the Operating
Expense or Real Property Taxes that is obtained by multiplying such cost by a
fraction, the numerator of which is the number of square feet of leasable space
in the Premises and the denominator of which is the number of square feet of
leasable space in the entire Building (if the Building is modified to Increase
or decrease Its square footage, this Increase or decrease shall be taken Into
consideration In determining Tenant's Percentage Share of the Building) and (ii)
with respect to an Operating Expense or Real Property Taxes attributable to the
Common Areas of the Project, but not any particular building in the Project,
requiring Tenant to pay that portion of the cost of the Operating Expense or
Real Property Taxes that is obtained by multiplying such cost by a fraction, the
numerator of which is the number of square feet of leasable space in the
Premises and the denominator of which is the number of square feet of leasable
space in all buildings in the Project or (c) by allocating an Operating Expense
or Real Property Taxes in any other commercially reasonable manner.

         6.5      AUDITS. If Tenant disputes the amount set forth in the
Statement, Tenant shall have the right, at Tenant's sole expense, not later than
sixty (60) days following receipt of such Statement, to cause Landlord's books
and records with respect to the calendar year which is the subject of the
Statement to be audited by a certified public accountant mutually acceptable to
Landlord and Tenant. The audit shall take place at the offices of Landlord where
its books and records are located at a mutually convenient time during
Landlord's regular business hours. Tenant's Percentage Share of Operating
Expenses shall be appropriately adjusted based upon the results of such audit,
and the results of such audit shall be final and binding upon Landlord and
Tenant. The accountant conducting the audit shall be compensated on an hourly
basis and shall not be compensated based upon a percentage of overcharges it
discovers. No subtenant shall have any right to conduct an audit, and no
assignee shall conduct an audit for any period during which such assignee was
not in possession of the Premises. Tenant's right to undertake an audit with
respect to any calendar year shall expire sixty (60) days after Tenant's receipt
of the Statement for such calendar year, and such Statement shall be final and
binding upon Tenant and shall, as between the parties, be conclusively deemed
correct, at the end of such sixty (60) day period, unless prior thereto Tenant
shall have given Landlord written notice of its intention to audit Operating
Expenses for the calendar year which is the subject of the Statement. If Tenant
gives Landlord notice of its intention to audit Operating Expenses, it must
commence such audit within sixty (60) days after such notice is delivered to
Landlord, and the audit must be completed within one hundred twenty (120) days
after such notice is delivered to Landlord. If Tenant does not commence and
complete the audit within such periods, the Statement which Tenant elected to
audit shall be deemed final and binding upon Tenant and shall, as between the
parties, be conclusively deemed correct. Tenant agrees that the results of any
Operating Expense audit shall be kept strictly confidential by Tenant and shall
not be disclosed to any other person or entity.

         6.6      AMORTIZATION OF CERTAIN IMPROVEMENTS. Pursuant to sections 6.1
and 12 of this Lease, Landlord has the right to require Tenant to pay for
certain costs related to the replacement of the roof membrane and HVAC units at
the Building and the resurfacing of the asphalt and concrete driveways and
parking areas of the Project (collectively, the "MAJOR ITEMS"). Notwithstanding
anything to the contrary contained in sections 6.1 and 12, if Landlord replaces
a Major Item, and in accordance with GAAP, the entire cost of the replacement is
not deductible as an expense in the year incurred, Landlord shall amortize the
cost of the replacement of the Major Item over its useful life, as reasonably
determined by Landlord, and Tenant shall only be obligated to reimburse Landlord
each year for its Percentage Share of such amortized cost.

7.       SECURITY DEPOSIT. Tenant shall deliver to Landlord at the time it
executes this Lease the security deposit set forth in section 1.12 as security
for Tenant's faithful performance of Tenant's obligations hereunder. If Tenant
fails to pay Base Rent or other charges due hereunder, or otherwise defaults
with respect to any provision of this Lease, Landlord may use ail or any portion
of said deposit for the payment of any Base Rent or other charge due hereunder,
to pay any other sum to which Landlord may become obligated by reason of
Tenant's default, or to compensate Landlord for any loss or damage which
Landlord may suffer thereby. If Landlord so uses or applies all or any portion
of said deposit, Tenant shall within thirty (30) days after written demand
therefore deposit cash with Landlord in an amount sufficient to restore said
deposit to its full amount. Landlord shall not be required to keep said security
deposit separate from its general accounts. If Tenant performs all of Tenant's
obligations hereunder, said deposit, or so much thereof as has not heretofore
been applied by Landlord, shall

                                       4
<PAGE>

be returned, without payment of interest or other amount for its use, to Tenant
(or, at Landlord's option, to the last assignee, if any, of Tenant's interest
hereunder) within thirty (30) days after the expiration of the term hereof, or
after Tenant has vacated the Premises, whichever is later. No trust relationship
is created herein between Landlord and Tenant with respect to said security
deposit. Tenant acknowledges that the security deposit is not an advance payment
of any kind or a measure of Landlord's damages in the event of Tenant's default.
To the extent the provisions of any law are inconsistent with this section.
Tenant hereby waives such inconsistent provisions.

8.       UTILITIES.

         8.1      PAYMENT. Tenant shall pay for all water, gas, electricity,
telephone, sewer, sprinkler services, refuse and trash collection and other
utilities and services used on the Premises, together with any taxes, penalties,
surcharges or the like pertaining thereto. Tenant shall contract directly with
the applicable public utility for such services. Tenant shall pay its share of
all charges for jointly metered utilities based upon consumption, as reasonably
determined by Landlord.

         8.2      INTERRUPTIONS. Tenant agrees that Landlord shall not be liable
to Tenant for its failure to furnish water, gas, electricity, telephone, sewer,
refuse and trash collection or any other utility services or building services
when such failure is occasioned, in whole or in part, by repairs, replacements
or improvements, by any strike, lockout or other labor trouble, by inability to
secure electricity, gas, water, telephone service or other utility at the
Project, by any accident, casualty or event arising from any cause whatsoever,
including the negligence of contractors or by act, negligence or default of
Tenant, and such failures shall never be deemed to constitute an eviction or
disturbance of Tenant's use and possession of the Premises or relieve Tenant
from the obligation of paying rent or performing any of its obligations under
this Lease. Furthermore, Landlord shall not be liable under any circumstances
for loss of property or for injury to, or interference with, Tenant's business,
Including, without limitation, loss of profits, however occurring, through or in
connection with or incidental to a failure per the foregoing to furnish any such
services or utilities. Provided that Landlord first obtains Tenant's consent,
which shall not be unreasonably withheld, Landlord may comply with voluntary
controls or guidelines promulgated by any governmental entity relating to the
use or conservation of energy, water, gas, light or electricity or the reduction
of automobile or other emissions without creating any liability of Landlord to
Tenant under this Lease. In the event there is an interruption in a service
provided by Landlord to Tenant, Landlord shall proceed diligently and in a
commercially reasonable manner to end the interruption.

         8.3      Intentionally deleted.

         8.4.     ALTERNATIVE UTILITY PROVIDERS. If permitted by applicable
laws, and provided service to Tenant is at least equal to the then existing
service and provided Tenant's Share of Operating Expenses is not increased
thereby, Landlord shall have the right at any time and from time to time during
the term of this Lease to either contract for service from a different company
or companies (each such company referred to as an "ALTERNATE SERVICE PROVIDER")
other than the company or companies presently providing electrical service for
the Project (the "ELECTRIC SERVICE PROVIDER") or continue to contract for
service from the Electric Service Provider, at Landlord's sole discretion.
Tenant agrees to cooperate with Landlord, the Electric Service Provider, and an
Alternate Service Provider at all times and, as reasonably necessary, shall
allow Landlord, the Electric Service Provider, and any Alternate Service
Provider reasonable access to the Building's electric lines, feeders, risers,
wiring and any other machinery within the Premises.

9.       REAL AND PERSONAL PROPERTY TAXES.

         9.1      PAYMENT OF TAXES. Tenant shall pay to Landlord during the term
of this Lease, in addition to Base Rent and Tenant's Percentage Share of
Operating Expenses, Tenant's Percentage Share of all Real Property Taxes.
Tenant's Percentage Share of Real Property Taxes shall be payable by Tenant at
the same time, in the same manner and under the same terms and conditions as
Tenant pays Tenant's Percentage Share of Operating Expenses.

         9.2      DEFINITION of REAL PROPERTY TAX. As used herein, the term
"REAL PROPERTY TAXES" shall include any form of real estate tax or assessment,
general, special, ordinary or extraordinary, improvement bond or bonds imposed
on the Project or any portion thereof by any authority having the direct or
indirect power to tax, including any city, county, state or federal government,
or any school, agricultural, sanitary, fire, street, drainage or other
improvement district thereof, as against any legal or equitable interest of
Landlord in the Project or in any portion thereof. Real Property Taxes shall not
include income, inheritance and gift taxes.

         9.3      PERSONAL PROPERTY TAXES. Tenant shall pay prior to delinquency
all taxes assessed against and levied upon trade fixtures, furnishings,
equipment and all other personal property of Tenant contained in the Premises or
related to Tenant's use of the Premises. If any of Tenant's personal property
shall be assessed with Landlord's real or personal property, Tenant shall pay to
Landlord the taxes attributable to Tenant within ten (10) days after receipt of
a written statement from Landlord setting forth the taxes applicable to Tenant's
property.

         9.4      REASSESSMENTS. From time to time Landlord may challenge the
assessed value of the Project as determined by applicable taxing authorities
and/or Landlord may attempt to cause the Real Property Taxes to be reduced on
other grounds. If Landlord is successful in causing the Real Property Taxes to
be reduced or in obtaining a refund, rebate, credit or similar benefit
(hereinafter collectively referred to as a "reduction"), Landlord shall to the
extent practicable, credit the reduction(s) to Real Property Taxes for the
calendar year to which a reduction applies and recalculate the Real Property
Taxes owed by Tenant for years in which the reduction applies based on the
reduced Real Property Taxes. All costs incurred by Landlord in obtaining the
Real Property Tax reductions shall be considered an Operating Expense, and
Landlord shall determine, in its sole discretion, to which years any reductions
will be applied. In addition, all accounting and related costs incurred by
Landlord in making the adjustments shall be an Operating Expense. Landlord shall
have the right to compensate a person or entity it employs to obtain a reduction
in Real Property Taxes by giving such person or entity a percentage of any
reduction or credit obtained, and in this event the reduction or credit obtained
by Landlord shall be deemed to be the reduction or credit given by the taxing
authority less the compensation paid to such person or entity.

10.      INSURANCE.

         10.1     INSURANCE-TENANT.

                  (a)      Tenant shall obtain and keep in force during the term
of this Lease a commercial general liability policy of insurance with coverages
acceptable to Landlord, in Landlord's reasonable discretion, which, by way of
example and not limitation, protects Tenant and Landlord (as an additional
Insured) against claims for bodily injury, personal injury and property damage
based upon, involving or arising out of the ownership, use, occupancy or
maintenance of the Premises and all areas appurtenant thereto. Such insurance
shall be on an occurrence basis providing single-limit coverage in an amount not
less than $1,000,000 per occurrence, $3,000,000 for injuries to more than one
person in any one accident and $2,000,000 for property damage per accident with
an "Additional Insured-Managers and Landlords of Premises Endorsement" and
contain the "Amendment of the Pollution Exclusion" for damage caused by heat,
smoke or fumes from a hostile fire. The policy shall not contain any
intra-insured exclusions as between insured persons or organizations, but shall
include coverage

                                       5
<PAGE>

for liability assumed under this Lease as an "Insured contract" for the
performance of Tenant's indemnity obligations under this Lease.

                  (b)      Tenant shall obtain and keep in force during the term
of this Lease "all-risk" extended coverage property insurance with coverages
acceptable to Landlord, in Landlord's reasonable discretion. Said insurance
shall be written on a ninety percent (90%) replacement cost basis on Tenant's
personal property, all tenant improvements installed at the Premises by Landlord
or Tenant, Tenant's trade fixtures and other property; provided however that all
costs of repair or replacement of Tenant's personal property as a result of
insuring less than the full replacement cost of the personal property shall be
borne solely by Tenant and shall not be paid by Landlord under any
circumstances. By way of example, and not limitation, such policies shall
provide protection against any peril included within the classification "fire
and extended coverage," against vandalism and malicious mischief, theft and
sprinkler leakage.

                  (c)      Tenant shall, at all times during the term hereof,
maintain in effect workers' compensation insurance as required by applicable law
and business interruption and extra expense insurance satisfactory to Landlord.
Notwithstanding anything to the contrary contained In this section, Tenant shall
have the right to act as the insurer for purposes of providing the business
interruption insurance described above. Landlord shall not be responsible or
liable to Tenant for any damages or other amounts which would be paid by the
business interruption insurance described above, even if the damages are caused
by Landlord's employees, agents, visitors, invitees, guests or independent
contractors (collectively, "LANDLORD'S ASSOCIATES"), and Tenant hereby releases
Landlord's Associates from any claim, demands, loss, damages, consequential
damages, and the like, resulting from damage or liability that would be covered
by such business interruption insurance. If Tenant assigns this Lease, the
assignee shall not have the right to provide self-insurance for business
interruption insurance unless the assignee is an Affiliate (as defined below).

         10.2     INSURANCE-LANDLORD.

                  (a)      Landlord shall obtain and keep in force a policy of
general liability insurance with coverage against such risks and in such amounts
as are commercially reasonable insuring Landlord against liability arising out
of the ownership, operation and management of the Project.

                  (b)      Landlord shall also obtain and keep in force during
the term of this Lease a policy or policies of insurance covering loss or damage
to the Project in the amount of not less than eighty percent (80%) of the full
replacement cost thereof, as determined by Landlord from time to time, provided
however that all costs of repair or replacement for the Project payable by
Landlord as a result of insuring less than the full replacement cost of the
Project (except for any insurance deductible expressly permitted by section 6.2
below) shall be borne solely by Landlord and shall in no event be passed on to
Tenant as an Operating Expense or Capital improvement. The terms and conditions
of said policies and the perils and risks covered thereby shall be determined by
Landlord, from time to time, in Landlord's sole discretion. In addition, at
Landlord's option, Landlord shall obtain and keep in force, during the term of
this Lease, a policy of rental interruption insurance, with loss payable to
Landlord, which insurance shall, at Landlord's option, also cover all Operating
Expenses and Real Property Taxes. Tenant will not be named as an additional
Insured in any insurance policies carried by Landlord and shall have no right to
any proceeds therefrom. The policies purchased by Landlord shall contain such
deductibles as Landlord may determine and as are commercially reasonable. Tenant
shall pay at Tenant's sole expense any increase in the property insurance
premiums for the Project over what was payable immediately prior to the increase
to the extent the increase is specified by Landlord's insurance carrier as being
caused by the nature of Tenant's occupancy or any act or omission of Tenant.

         10.3     INSURANCE POLICIES. Unless Tenant has already done so, Tenant
shall deliver to Landlord certificates of the insurance policies required under
section 10.1 within fifteen (15) days prior to the Commencement Date of this
Lease. Tenant's insurance policies shall not be cancelable except after thirty
(30) days prior written notice to Landlord. Tenant shall, at least ten (10) days
prior to the expiration of such policies, furnish Landlord with renewals
thereof. Tenant's insurance policies shall be issued by insurance companies
authorized to do business in the state in which the Premises is located, and
said companies shall maintain during the policy term a "General Policyholder's
Rating" of at least A and a financial rating of at least "Class X" (or such
other rating as may be required by any lender having a lien on the Premises) as
set forth in the most recent edition of "Best insurance Reports." All insurance
obtained by Tenant shall be primary to and not contributory with any similar
insurance carried by Landlord, whose insurance shall be considered excess
insurance only. Landlord and, at Landlord's option, the holder of any mortgage
or deed of trust encumbering the Project and any person or entity managing the
Project on behalf of Landlord, shall be named as an additional insured on all
insurance policies Tenant is obligated to obtain by section 10.1 above. Tenant
shall use commercially reasonable efforts to maintain deductibles of less than
One Hundred Thousand Dollars ($100,000), with the exception of the perils of
earthquake and flood, which are subject to commercially available terms.

         10.4     WAIVER OF SUBROGATION. Landlord and Tenant hereby release each
other from any claims and demands of whatever nature for damage, loss or injury
to the Premises and/or the Project, or to the other's property in, on or about
the Premises and the Project, that are caused by or result from risks or perils
insured against under any property insurance policies required by this Lease to
be carried by Landlord and/or Tenant whether or not in force at the time of any
such damage, loss or injury. Landlord and Tenant shall cause each insurance
policy obtained by them to provide that the insurance company waives all right
of recovery by way of subrogation against either Landlord or Tenant in
connection with any damage covered by any such policy or policies.

         10.5     COVERAGE. Landlord makes no representation to Tenant that the
limits or forms of coverage specified above or approved by Landlord are adequate
to insure Tenant's property or Tenant's obligations under this Lease.

11.      LANDLORD'S REPAIRS.

         11.1     LANDLORD'S SOLE EXPENSE. Landlord shall maintain, at
Landlord's expense (and shall not include in Operating Expenses), only the
structural elements of the roof of the Building (excluding the roof membrane),
the structural soundness of the foundation of the Building and the structural
elements of the exterior walls of the Building and the structural elements of
existing interior load bearing walls of the Building (excluding any load bearing
walls constructed by Tenant, which Tenant shall maintain and repair at Tenant's
sole expense). Tenant shall reimburse Landlord for the cost of any maintenance,
repair or replacement of the foregoing necessitated by Tenant's misuse,
negligence, alterations to the Premises or any breach of its obligations under
this Lease. By way of example, and not limitation, the term "EXTERIOR WALLS" as
used in this section shall not include windows, glass or plate glass, doors or
overhead doors, special store fronts, dock bumpers, dock plates or levelers, or
office entries unless damage to the foregoing is caused by foundation settlement
or failure of the structural elements of the Building and such settlement or
failure is not caused by Tenant. Tenant shall immediately give Landlord written
notice of any repair required by Landlord pursuant to this section, after which
Landlord shall have a reasonable time in which to complete the repair. Nothing
contained in this section shall be construed to obligate Landlord to seal or
otherwise maintain the surface of any foundation, floor or slab. Tenant
expressly waives the benefits of any statute now or hereafter in effect which
would otherwise afford Tenant the right to make repairs at Landlord's expense or
to terminate this Lease because of Landlord's failure to keep the Premises in
good order, condition and repair.

                                       6
<PAGE>

         11.2     LANDLORD REPAIRS INCLUDED IN OPERATING EXPENSES. Landlord
shall employ contractors to perform all repairs, maintenance and replacements of
the roof membranes, heating, ventilation and air conditioning ("HVAC") units
(see section 12.2 below), parking areas, landscaped areas and exterior walls of
the Premises. The items described in the previous sentence that Landlord will
cause to be repaired, maintained and replaced are hereinafter referred to as the
"LANDLORD MAINTENANCE ITEMS." Landlord's maintenance of the exterior walls of
the Premises shall include the right, but not the obligation, of Landlord to
paint from time to time all or some of the exterior walls, canopies, doors,
windows, gutters, handrails and other exterior parts of the Premises with colors
selected by Landlord. Tenant shall immediately give Landlord written notice of
any repair or maintenance required by Landlord pursuant to this section, after
which Landlord shall have a reasonable time in which to complete such repair or
maintenance. Landlord shall use commercially reasonable efforts to minimize
disruption to Tenant's business operations caused by the performance of Landlord
Maintenance Items provided, however, that Landlord shall not be obligated to
incur additional costs in connection with such efforts. Subject to the
limitations set forth in section 6 of this Lease, Landlord shall include the
cost of Landlord Maintenance Items in Operating Expenses, and Tenant shall then
pay Tenant's Percentage Share of such costs.

         11.3     PERFORMANCE OF LANDLORD REPAIRS BY TENANT. If Landlord
defaults in the performance of its obligations under sections 11.1 and 11.2
(Landlord shall not be in default until it has been given notice of default as
required by section 17.3 and has failed to cure the default during the
applicable cure period set forth in section 17.3), then Tenant may proceed to
perform such obligations upon delivery of an additional ten (10) business days
advance written notice to Landlord specifying that Tenant intends to perform
such obligations, and Tenant shall be entitled to prompt reimbursement by
Landlord of Tenant's reasonable costs and expenses in taking such action. Tenant
shall not be entitled to reimbursement until Tenant has provided Landlord with
reasonable documentation that it has paid for a repair and/or maintenance
Landlord was obligated to perform pursuant to sections 11.1 or 11.2 and has
provided Landlord with valid mechanic's lien releases. In the event Tenant takes
such action, Tenant shall use only those contractors used by Landlord in the
Building for similar work unless such contractors are unwilling or unable to
perform such work in a timely manner at reasonably competitive rates (vis-a-vis
other qualified contractors), in which event Tenant may utilize the services of
any other qualified contractor which normally and regularly performs similar
work in the comparable buildings. Tenant shall require the contractors to
provide evidence of commercially reasonable insurance coverage before performing
any maintenance and/or repair, and shall ensure that Landlord is named as an
additional insured on such insurance policy(s). Further, if Landlord does not
deliver a detailed written objection to Tenant, within thirty (30) days after
receipt of an invoice by Tenant of its costs of taking action which Tenant
claims should have been taken by Landlord, and if such invoice from Tenant sets
forth a reasonably particularized breakdown of its costs and expenses in
connection with taking such action on behalf of Landlord, then Tenant shall be
entitled to deduct from Base Rent payable by Tenant under this Lease, the amount
set forth in such invoice. If, however, Landlord delivers to Tenant within
thirty (30) days after receipt of Tenant's invoice, a written objection to the
payment of such invoice, setting forth with reasonable particularity Landlord's
reasons for its claim that such action did not have to be taken by Landlord
pursuant to the terms of this Lease or that the charges are excessive (in which
case Landlord shall pay the amount it contends would not have been excessive),
then Tenant shall not be entitled to such deduction from Base Rent, but as
Tenant's sole remedy, Tenant may proceed to claim a default by Landlord under
this Lease. For purposes of the foregoing, in order for charges to be deemed
excessive Landlord must provide (i) supporting documentation from an independent
qualified contractor properly licensed, insured and doing business in the city
in which the Premises are located, and (ii) such alternate price submitted and
so documented by Landlord must be at least ten (10%) percent less than the cost
claimed by Tenant.

12.      TENANT'S REPAIRS.

         12.1     OBLIGATIONS OF TENANT. Tenant shall, at its sole cost and
expense, keep and maintain all parts of the Premises (except those listed as
Landlord's responsibility in section 11 above) In good and sanitary condition,
promptly making all necessary repairs and replacements, including but not
limited to, windows, glass and plate glass, doors, skylights, any special store
front or office entry, walls and finish work, floors and floor coverings, dock
boards, bumpers, plates, seals, levelers and lights, plumbing work and fixtures
(including periodic backflow testing), electrical systems, lighting facilities
and bulbs, sprinkler systems, alarm systems, fire detection systems, termite and
pest extermination, fencing, tenant signage and regular removal of trash and
debris. Tenant shall notify Landlord in writing prior to making any repair or
performing any maintenance pursuant to this section if such repair or
maintenance is material in nature, would affect the general appearance or
functionality of the Building or its systems or if notice to Landlord is
required pursuant to section 13.1. Landlord shall have the right to designate
the contractor Tenant shall use to make any repair or to perform any maintenance
on the, plumbing systems, electrical systems, sprinkler systems, fire alarm
systems or fire detection systems located at the Premises. Tenant shall not
paint or otherwise change the exterior appearance of the Premises without
Landlord's prior written consent, which may be given or withheld in Landlord's
sole discretion. The cost of maintenance and repair of any common party wall
(any wall, divider, partition or any other structure separating the Premises
from any adjacent premises occupied by other tenants) shall be shared equally by
Tenant and the tenant occupying the adjacent premises; provided, however, if
Tenant damages a party wall the entire cost of the repair shall be paid by
Tenant, at Tenant's sole expense. Tenant shall not damage any party wall or
disturb the integrity and support provided by any party wall. If Tenant fails to
keep the Premises in good condition and repair, Landlord may, but shall not be
obligated to, make any necessary repairs. If Landlord makes such repairs,
Landlord may bill Tenant for the cost of the repairs as additional rent, and
said additional rent shall be payable by Tenant within thirty (30) days after
demand by Landlord.

         12.2     HVAC MAINTENANCE. Notwithstanding Landlord's obligation to
maintain, repair and replace the HVAC units pursuant to section 112, subject to
the limitations set forth below, Tenant shall maintain and repair; but not
replace, the HVAC units servicing the Premises. In the event an HVAC unit needs
to be replaced, as reasonably determined by Landlord, Landlord shall replace the
HVAC unit in accordance with section 11.2 above. While Tenant is responsible for
the maintenance and repair of the HVAC units, Tenant, not Landlord, shall enter
into a regularly scheduled preventative maintenance/service contract (the "HVAC
CONTRACT") for the HVAC units servicing the Premises, and the terms and
conditions of the HVAC Contract shall be acceptable to Landlord, in Landlord's
reasonable discretion. At Landlord's request, Tenant shall provide Landlord with
a copy of the HVAC Contract. Tenant shall pay all costs it incurs in maintaining
and repairing the HVAC units and in purchasing the Maintenance Contract at
Tenant's sole cost and expense, and Landlord shall have no obligation to
reimburse Tenant for any of such costs. If Tenant fails to maintain and repair
the HVAC units in a commercially reasonable manner, Landlord shall have the
right to elect to (a) maintain and repair the HVAC units pursuant to section
11.2 and (b) obtain the HVAC maintenance contract pursuant to section 12.3.

         12.3     MAINTENANCE CONTRACTS. Landlord shall enter into regularly
scheduled preventative maintenance/service contracts for some or all of the
following: the HVAC units servicing the Premises (see section 12.2) and for the
roof membrane of the Premises (the "MAINTENANCE CONTRACTS"). The Maintenance
Contracts shall include maintenance services satisfactory to Landlord, in
Landlord's sole discretion. Landlord shall include the cost of Maintenance
Contracts in Operating Expenses, and Tenant shall then pay Tenant's Percentage
Share of such costs as determined by Landlord.

13.      ALTERATIONS AND SURRENDER.

         13.1     CONSENT OF LANDLORD. Tenant shall have the right, subject to
Landlord's reasonable requirements relating to construction at the Project,
upon ten (10) days prior written notice to Landlord, to make alterations
("PERMITTED ALTERATIONS") to the inside of the Premises (e.g., paint and carpet,
communication systems, telephone and computer system wiring) that do not (i)
involve the expenditure of more than $25,000.00; (ii) affect the exterior
appearance of the Building or the roof, (iii) affect

                                       7
<PAGE>

the Building's electrical, plumbing, HVAC, life, fire safety or similar Building
systems or the structural elements of the Building, (iv) affect the Common Areas
or parking areas or (v) materially adversely affect any other tenant of the
Project. Except with respect to Permitted Alterations, Tenant shall not without
Landlord's prior written consent, which may be given or withheld in Landlord's
reasonable discretion, make any alterations, improvements, additions, utility
installations or repairs (hereinafter collectively referred to as "NON-PERMITTED
ALTERATIONS") in, on or about the Premises or the Project; provided, however,
Landlord shall have no obligation to consent to any structural alteration to the
Building or a modification of any building system that would adversely affect
the operation of the building system. References in this Lease to "ALTERATIONS"
shall mean both Permitted Alterations and Non-Permitted Alterations. At the
expiration of the term, Landlord may require the removal of any Alterations
installed by Tenant and the restoration of the Premises and the Project to their
prior condition, at Tenant's expense if, at the time of Landlord's consent,
Landlord did not agree in writing that Tenant would not be obligated to remove
the Alterations. Tenant shall not be obligated to remove the improvements
located in the Premises as of the date of this Lease. If, as a result of any
Alteration made by Tenant, Landlord is obligated to comply with the Americans
With Disabilities Act or any other law or regulation, and such compliance
requires Landlord to make any improvement or Alteration to any portion of the
Project, as a condition to Landlord's consent, Landlord shall have the right to
require Tenant to pay to Landlord prior to the construction of any Alteration by
Tenant the entire cost of any improvement or alteration Landlord is obligated to
complete by such law or regulation. Should Landlord permit Tenant to make its
own Alterations, Tenant shall use only such architect and contractor as has been
expressly approved by Landlord, in Landlord's reasonable discretion, and, if the
Alteration will cost more than $100,000 to complete, Landlord may require Tenant
to provide to Landlord, at Tenant's sole cost and expense, a lien and
completion bond in an amount equal to the estimated cost of such Alterations, to
insure Landlord against any liability for mechanic's and materialmen's liens and
to insure completion of the work. In addition, in order to compensate Landlord
for the overhead and other costs it incurs in reviewing the plans for the
Alterations and in monitoring the construction of the Alterations, Tenant shall
pay to Landlord a fee equal to the actual out-of-pocket costs incurred by
Landlord in reviewing and monitoring the construction of the Alterations, if
any; provided, however, in no event shall Tenant be obligated to reimburse
Landlord for out-of-pocket costs in excess of four percent (4%) of the cost of
the Alterations. Should Tenant make any Alterations without the prior approval
of Landlord, or use a contractor not expressly approved by Landlord, Landlord
may, at any time during the term of this Lease, require that Tenant remove all
or part of the Alterations and return the Premises to the condition it was in
prior to the making of the Alternations. In the event Tenant makes any
Alterations, and conditions warrant (In Landlord's discretion), Landlord may
require Tenant to obtain or cause its contractor to obtain, prior to the
commencement of any work, "builders all risk" insurance in an amount approved by
Landlord, workers compensation insurance and any other insurance requested by
Landlord, in Landlord's sole discretion.

         13.2     PERMITS. Any Alterations in or about the Premises that Tenant
shall desire to make shall be presented to Landlord in written form, with plans
and specifications which are sufficiently detailed to obtain a building permit.
If Landlord consents to an Alteration, the consent shall be deemed conditioned
upon Tenant acquiring a building permit from the applicable governmental
agencies, furnishing a copy thereof to Landlord prior to the commencement of the
work, and compliance by Tenant with all conditions of said permit in a prompt
and expeditious manner. Tenant shall provide Landlord with as-built plans and
specifications for any Alterations made to the Premises if such Alterations
required a building permit.

         13.3     MECHANICS LIENS. Tenant shall pay, when due, all claims for
labor or materials furnished or alleged to have been furnished to or for Tenant
at or for use in the Premises, which claims are or may be secured by any
mechanic's or materialmen's lien against the Premises or the Project, or any
interest therein. If Tenant shall, in good faith, contest the validity of any
such lien, Tenant shall furnish to Landlord a surety bond satisfactory to
Landlord in an amount equal to not less than one and one-half times the amount
of such contested lien claim indemnifying Landlord against liability arising out
of such lien or claim. Such bond shall be sufficient in form and amount to free
the Project from the effect of such lien. In addition, Landlord may require
Tenant to pay Landlord's reasonable attorneys' fees and costs in participating
in such action.

         13.4     NOTICE. Tenant shall give Landlord not less than ten (10)
days' advance written notice prior to the commencement of any work in the
Premises by Tenant, and Landlord shall have the right to post notices of
non-responsibility in or on the Premises or the Project.

         13.5     SURRENDER. Subject to Landlord's right to require removal or
to elect ownership as hereinafter provided, all Alterations made by Tenant to
the Premises shall be the property of Tenant, but shall be considered to be a
part of the Premises. Unless Landlord gives Tenant written notice of its
election not to become the owner of the Alterations at the end of the term of
this Lease, the Alterations shall become the property of Landlord at the end of
the term of this Lease. Landlord may require, on notice to Tenant, that some or
all Alterations be removed prior to the end of the term of this Lease and that
any damages caused by such removal be repaired at Tenant's sole expense. On the
last day of the term hereof, or on any sooner termination, Tenant shall
surrender the Premises (including, but not limited to, all doors, windows,
floors and floor coverings, skylights, heating and air conditioning systems,
dock boards, truck doors, dock bumpers, plumbing work and fixtures, electrical
systems, lighting facilities, sprinkler systems, fire detection systems and
nonstructural elements of the exterior walls, foundation and roof (collectively
the "ELEMENTS OF THE PREMISES")) to Landlord in the same condition as received,
ordinary wear and tear and casualty damage excepted, clean and free of debris
and Tenant's personal property, trade fixtures and equipment. Tenant's personal
property shall include its trade fixtures and equipment, furnishings, office
equipment, furniture, communication/telephone devices, computers (and all
related equipment) and all computer wiring and cabling installed by Tenant.
Provided, however, if Landlord has not elected to have Tenant remove the
Alterations, Tenant shall leave the Alterations at the Premises in good
condition and repair, ordinary wear and tear excepted. Tenant shall repair any
damage to the Premises occasioned by the installation or removal of Tenant's
trade fixtures, furnishings and equipment. Damage to or deterioration of any
Element of the Premises or any other item Tenant is required to repair or
maintain at the Premises shall not be deemed ordinary wear and tear if the same
could have been prevented by good maintenance practices. If the Premises are not
surrendered at the expiration of the term or earlier termination of this Lease
in accordance with the provisions of this section, at Landlord's option, Tenant
shall continue to be responsible for the payment of Base Rent and all other
amounts due under this Lease until the Premises are so surrendered in accordance
with said provisions. Tenant shall indemnify, defend and hold Landlord harmless
from and against any and all damages, expenses, costs, losses or liabilities
arising from any delay by Tenant in so surrendering the Premises including,
without limitation, any damages, expenses, costs, losses or liabilities arising
from any claim against Landlord made by any succeeding tenant or prospective
tenant founded on or resulting from such delay and losses and damages suffered
by Landlord due to lost opportunities to lease any portion of the Premises to
any such succeeding tenant or prospective tenant, together with, in each case,
actual attorneys' fees and costs.

         13.6     FAILURE OF TENANT TO REMOVE PROPERTY. If this Lease is
terminated due to the expiration of its term or otherwise, and Tenant fails to
remove its property, in addition to any other remedies available to Landlord
under this Lease, and subject to any other right or remedy Landlord may have
under applicable law, Landlord may remove any property of Tenant from the
Premises and store the same elsewhere at the expense and risk of Tenant.

14.      DAMAGE AND DESTRUCTION.

         14.1     EFFECT OF DAMAGE OR DESTRUCTION. If all or part of the Project
is damaged by fire, earthquake, flood, explosion, the elements, riot, the
release or existence of Hazardous Materials (as defined below) or by any other
cause whatsoever (hereinafter collectively referred to as "DAMAGES"), but the
damages are not material (as defined in section 14.2 below), Landlord shall
repair the damages to the Project as soon as is reasonably possible, and this
Lease shall remain in full

                                       8
<PAGE>

force and effect. If all or part of the Project is destroyed or materially
damaged (as defined in section 14.2 below), Landlord shall have the right, in
its sole and complete discretion, to repair or to rebuild the Project or to
terminate this Lease. Landlord shall within ninety (90) days after the discovery
of such material damage or destruction notify Tenant in writing of Landlord's
intention to repair or to rebuild or to terminate this Lease. Tenant shall in no
event be entitled to compensation or damages on account of annoyance or
inconvenience in making any repairs, or on account of construction, or on
account of Landlord's election to terminate this Lease. Notwithstanding the
foregoing, if Landlord shall elect to rebuild or repair the Project after damage
or destruction, but in good faith determines that the Premises cannot be
substantially repaired within one hundred eighty (180) days after the date of
the discovery of the damage or destruction, without payment of overtime or other
premiums, and the damage to the Project will render the entire Premises unusable
during said one hundred eighty (180) day period, Landlord shall notify Tenant
thereof in writing at the time of Landlord's election to rebuild or repair, and
Tenant shall thereafter have a period of thirty (30) days within which Tenant
may elect to terminate this Lease, upon thirty (30) days' advance written notice
to Landlord. Tenant's termination right described in the preceding sentence
shall not apply if the damage was caused by the negligent or intentional acts of
Tenant or its employees, agents, contractors or invitees. Failure of Tenant to
exercise said election within said thirty (30) day period shall constitute
Tenant's agreement to accept delivery of the Premises under this Lease whenever
tendered by Landlord, provided Landlord thereafter pursues reconstruction or
restoration diligently to completion, subject to delays caused by Force Majeure
Events. A "FORCE MAJEURE EVENT" shall mean fire, earthquake, weather delays or
other acts of God, strikes, boycotts, war, riot, insurrection, embargoes,
shortages of equipment, labor or materials, delays in issuance of governmental
permits or approvals, or any other cause beyond the reasonable control of
Landlord. If Landlord is unable to repair the damage to the Premises or the
Project during such one hundred eighty (180) day period due to Force Majeure
Events, the one hundred eighty (180) day period shall be extended by the period
of delay caused by the Force Majeure Events. Subject to section 14.3 below, if
Landlord or Tenant terminates this Lease in accordance with this section 14.1,
Tenant shall continue to pay all Base Rent, Operating Expenses and other amounts
due hereunder which arise prior to the date of termination.

         14.2     DEFINITION OF MATERIAL DAMAGE. Damage to the Project shall be
deemed material if, in Landlord's reasonable judgment, the uninsured cost of
repairing the damage will exceed One Hundred Thousand Dollars ($100,000). If
insurance proceeds are available to Landlord in an amount which is sufficient to
pay the entire cost of repairing all of the damage to the Project, the damage
shall be deemed material if the cost of repairing the damage exceeds Three
Hundred Thousand Dollars ($300,000). Damage to the Project shall also be deemed
material if (a) the Project cannot be rebuilt or repaired to substantially the
same condition it was in prior to the damage due to laws or regulations in
effect at the time the repairs will be made, (b) the holder of any mortgage or
deed of trust encumbering the Project requires that insurance proceeds available
to repair the damage in excess of One Hundred Thousand Dollars ($100,000) be
applied to the repayment of the indebtedness secured by the mortgage or the deed
of trust, or (c) the damage occurs during the last twelve (12) months of the
Lease term.

         14.3     ABATEMENT OF RENT. If Landlord elects to repair damage to the
Project and all or part of the Premises will be unusable or inaccessible to
Tenant in the ordinary conduct of its business until the damage is repaired, and
the damage was not caused by the negligence or intentional acts of Tenant or its
employees, agents, contractors or invitees, Tenant's Base Rent and Tenant's
Share of Operating Expenses shall be abated until the repairs are completed in
proportion to the amount of the Premises which is unusable or inaccessible to
Tenant in the ordinary conduct of its business. Notwithstanding the foregoing,
there shall be no abatement of Base Rent or Tenant's Share of Operating Expenses
by reason of any portion of the Premises being unusable or inaccessible for a
period equal to five (5) consecutive business days or less.

         14.4     TENANT'S ACTS. If such damage or destruction occurs as a
result of the negligence or the Intentional acts of Tenant or Tenant's
employees, agents, contractors or invitees, and the proceeds of insurance which
are actually received by Landlord are not sufficient to pay for the repair of
all of the damage, Tenant shall pay, at Tenant's sole cost and expense, to
Landlord upon demand, the difference between the cost of repairing the damage
and the insurance proceeds received by Landlord.

         14.5     TENANT'S PROPERTY. Landlord shall not be liable to Tenant or
its employees, agents, contractors, invitees or customers for loss or damage to
merchandise, tenant improvements, fixtures, automobiles, furniture, equipment,
computers, files or other property (hereinafter collectively "TENANT'S
PROPERTY") located at the Project. Tenant shall repair or replace all of
Tenant's property at Tenant's sole cost and expense. Tenant acknowledges that it
is Tenant's sole responsibility to obtain adequate insurance coverage to
compensate Tenant for damage to Tenant's property.

         14.6     WAIVER. Landlord and Tenant hereby waive the provisions of any
present or future statutes which relate to the termination of leases when leased
property is damaged or destroyed and agree that such event shall be governed by
the terms of this Lease.

15.      CONDEMNATION. If any portion of the Premises or the Project are taken
under the power of eminent domain, or sold under the threat of the exercise of
said power (all of which are herein called "CONDEMNATION"), this Lease shall
terminate as to the part so taken as of the date the condemning authority takes
title or possession, whichever first occurs; provided that if so much of the
Premises or Project are taken by such condemnation as would substantially and
adversely affect the operation and profitability of Tenant's business conducted
from the Premises, and said taking lasts for ninety (90) days or more, Tenant
shall have the option, to be exercised only in writing within thirty (30) days
after Landlord shall have given Tenant written notice of such taking (or in the
absence of such notice, within thirty (30) days after the condemning authority
shall have taken possession), to terminate this Lease as of the date the
condemning authority takes such possession. If a taking lasts for less than
ninety (90) days, Tenant's rent and Operating Expenses shall be abated during
said period but Tenant shall not have the right to terminate this Lease. If
Tenant does not terminate this Lease in accordance with the foregoing, this
Lease shall remain in full force and effect as to the portion of the Premises
remaining, except that the Base Rent and Operating Expenses shall be reduced in
the proportion that the usable floor area of the Premises taken bears to the
total usable floor area of the Premises. Common Areas taken shall be excluded
from the Common Areas usable by Tenant and no reduction of rent shall occur with
respect thereto or by reason thereof. Landlord shall have the option in its sole
discretion to terminate this Lease as of the taking of possession by the
condemning authority, by giving written notice to Tenant of such election within
thirty (30) days after receipt of notice of a taking by condemnation of any part
of the Premises or the Project. Any award for the taking of all or any part of
the Premises or the Project under the power of eminent domain or any payment
made under threat of the exercise of such power shall be the property of
Landlord, whether such award shall be made as compensation for diminution in
value of the leasehold, for good will, for the taking of the fee, as severance
damages, or as damages for tenant improvements paid for by Landlord; provided,
however, that Tenant shall be entitled to any separate award for loss of or
damage to Tenant's removable personal property, for moving expenses and for loss
of tenant improvements separately paid for by Tenant. In the event that this
Lease is not terminated by reason of such condemnation, and subject to the
requirements of any lender that has made a loan to Landlord encumbering the
Project, Landlord shall to the extent of severance damages received by Landlord
in connection with such condemnation, repair any damage to the Project caused by
such condemnation except to the extent that Tenant has been reimbursed therefor
by the condemning authority.

16.      ASSIGNMENT AND SUBLETTING.

         16.1     LANDLORD'S CONSENT REQUIRED. Tenant shall not voluntarily or
by operation of law assign, transfer, hypothecate, mortgage, sublet, or
otherwise transfer or encumber all or any part of Tenant's interest in this
Lease or in the

                                       9
<PAGE>

Premises (hereinafter collectively a TRANSFER"), without Landlord's prior
written consent, which shall not be unreasonably withheld. Landlord shall
respond to Tenant's written request for consent hereunder within thirty (30)
days after Landlord's receipt of the written request from Tenant. Any attempted
Transfer without such consent shall be void and shall constitute a material
default and breach of this Lease. Tenant's written request for Landlord's
consent shall include, and Landlord's thirty (30) day response period referred
to above shall not commence, unless and until Landlord has received from Tenant,
all of the following information: (a) financial statements for the proposed
assignee or subtenant for the past three (3) years prepared in accordance with
generally accepted accounting principles, (b) federal tax returns for the
proposed assignee or subtenant for the past three (3) years, (c) a TRW credit
report or similar report on the proposed assignee or subtenant, (d) a detailed
description of the business the assignee or subtenant intends to operate at the
Premises, (e) the proposed effective date of the assignment or sublease, (f) a
copy of the proposed sublease or assignment agreement which includes all of the
terms and conditions of the proposed assignment or sublease, (g) a detailed
description of any ownership or commercial relationship between Tenant and the
proposed assignee or subtenant, (h) a detailed description of any Alterations
the proposed assignee or subtenant desires to make to the Premises, and (i) a
Hazardous Materials Disclosure Certificate substantially in the form of Exhibit
attached hereto (the "TRANSFEREE HAZMAT CERTIFICATE"). If the obligations of the
proposed assignee or subtenant will be guaranteed by any person or entity,
Tenant's written request shall not be considered complete until the information
described in (a), (b) and (c) of the previous sentence has been provided with
respect to each proposed guarantor. "TRANSFER" shall also include the transfer
(a) if Tenant is a corporation, and Tenant's stock is not publicly traded over a
recognized securities exchange, of more than fifty percent (50%) of the voting
stock of such corporation during the term of this Lease (whether or not in one
or more transfers) or the dissolution, merger or liquidation of the corporation,
or (b) if Tenant is a partnership, limited liability company, limited liability
partnership or other entity, of more than fifty percent (50%) of the profit and
loss participation in such partnership or entity during the term of this Lease
(whether or not in one or more transfers) or the dissolution, merger or
liquidation of the partnership, limited liability company, limited liability
partnership or other entity. If Landlord shall exercise any option to recapture
the Premises, or shall deny a request for consent to a proposed assignment or
sublease, Tenant shall indemnify, defend and hold Landlord harmless from and
against any and all losses, liabilities, damages, costs and claims that may be
made against Landlord by the proposed assignee or subtenant, or by any brokers
or other persons claiming a commission or similar compensation in connection
with the proposed assignment or sublease.

         16.2     Intentionally deleted.

         16.3     STANDARD FOR APPROVAL. Landlord shall not unreasonably
withhold its consent to a Transfer provided that Tenant has complied with each
and every requirement, term and condition of this section 16. Tenant
acknowledges and agrees that each requirement, term and condition in this
section 16 is a reasonable requirement, term or condition. It shall be deemed
reasonable for Landlord to withhold its consent to a Transfer if any
requirement, term or condition of this section 16 is not complied with or: (a)
the Transfer would cause Landlord to be in violation of its obligations under
another lease or agreement to which Landlord is a party; (b) in Landlord's
reasonable Judgment, a proposed assignee or subtenant is less able financially
to pay the rents due under this Lease as and when they are due and payable; (c)
a proposed assignee's or subtenant's business will impose a burden on the
Project's parking facilities, Common Areas or utilities that is greater than the
burden imposed by Tenant, in Landlord's reasonable Judgment; (d) the terms of a
proposed assignment or subletting will allow the proposed assignee or subtenant
to exercise a right of renewal, right of expansion, right of first offer, right
of first refusal or similar right held by Tenant; (e) a proposed assignee or
subtenant refuses to enter into a written assignment agreement or sublease,
reasonably satisfactory to Landlord, which provides that it will abide by and
assume all of the terms and conditions of this Lease for the term of any
assignment or sublease and containing such other terms and conditions as
Landlord reasonably deems necessary; (f) the use of the Premises by the proposed
assignee or subtenant will not be a use permitted by this Lease; (g) any
guarantor of this Lease refuses to consent to the Transfer or to execute a
written agreement reaffirming the guaranty; (h) Tenant is in default as defined
in section 17 at the time of the request; (i) if requested by Landlord, the
assignee or subtenant refuses to sign a non-disturbance and attornment agreement
in favor of Landlord's lender; (j) Landlord has sued or been sued by the
proposed assignee or subtenant or has otherwise been involved in a legal dispute
with the proposed assignee or subtenant; (k) the assignee or subtenant is
involved in a business which is not in keeping with the then-current standards
of the Project; (l) the proposed assignee or subtenant is an existing tenant of
the Project or is a person or entity then negotiating with Landlord for the
lease of space in the Project; (m) the assignment or sublease will result in
there being more than one subtenant of the Premises; (n) the assignee or
subtenant will use, store or handle Hazardous Materials in or about the Premises
of a type, nature, quantity not in compliance with the terms of this Lease.

         16.4     ADDITIONAL TERMS AND CONDITIONS. The following terms and
conditions shall be applicable to any Transfer:

                  (a)      Regardless of Landlord's consent, no Transfer shall
release Tenant from Tenant's obligations hereunder or alter the primary
liability of Tenant to pay the rent and other sums due Landlord hereunder and to
perform all other obligations to be performed by Tenant hereunder or release any
guarantor from its obligations under its guaranty.

                  (b)      Landlord may accept rent from any person other than
Tenant pending approval or disapproval of an assignment or subletting.

                  (c)      Neither a delay in the approval or disapproval of a
Transfer, nor the acceptance of rent, shall constitute a waiver or estoppel of
Landlord's right to exercise its rights and remedies for the breach of any of
the terms or conditions of this section 16.

                  (d)      The consent by Landlord to any Transfer shall not
constitute a consent to any subsequent Transfer by Tenant or to any subsequent
or successive Transfer by an assignee or subtenant.

                  (e)      In the event of any default under this Lease,
Landlord may proceed directly against Tenant, any guarantors or anyone else
responsible for the performance of this Lease, including any subtenant or
assignee, without first exhausting Landlord's remedies against any other person
or entity responsible therefor to Landlord, or any security held by Landlord.

                  (f)      Landlord's written consent to any Transfer by Tenant
shall not constitute an acknowledgment that no default then exists under this
Lease nor shall such consent be deemed a waiver of any then-existing default.

                  (g)      The discovery of the fact that any financial
statement relied upon by Landlord in giving its consent to an assignment or
subletting was materially false shall, at Landlord's election, render Landlord's
consent null and void.

                  (h)      Landlord shall not be liable under this Lease or
under any sublease to any subtenant.

                  (i)      No assignment or sublease may be modified or amended
without Landlord's prior written consent.

                  (j)      Intentionally deleted.

                                       11
<PAGE>

                  (k)      Any assignee of, or subtenant under, this Lease
shall, by reason of accepting such assignment or entering into such sublease, be
deemed, for the benefit of Landlord, to have assumed and agreed to conform and
comply with each and every term, covenant, condition and obligation herein to be
observed or performed by Tenant during the term of said assignment or sublease,
other than such obligations as are contrary or inconsistent with provisions of
an assignment or sublease to which Landlord has specifically consented in
writing.

                  (l)      At Landlord's request, Tenant shall deliver to
Landlord, Landlord's standard consent to assignment or consent to sublease
agreement, as applicable, executed by Tenant, the assignee and the subtenant, as
applicable.

         16.5     ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO SUBLETTING. The
following terms and conditions shall apply to any subletting by Tenant of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein:

                  (a)      Tenant hereby absolutely and unconditionally assigns
and transfers to Landlord all of Tenant's interest in all rentals and income
arising from any sublease entered into by Tenant, and Landlord may collect such
rent and income and apply same toward Tenant's obligations under this Lease;
provided, however, that until a default shall occur in the performance of
Tenant's obligations under this Lease that is not remedied by Tenant within the
applicable cure period, Tenant may receive, collect and enjoy the rents accruing
under such sublease. Landlord shall not, by reason of this or any other
assignment of such rents to Landlord nor by reason of the collection of the
rents from a subtenant, be deemed to have assumed or recognized any sublease or
to be liable to the subtenant for any failure of Tenant to perform and comply
with any of Tenant's obligations to such subtenant under such sublease,
including, but not limited to, Tenant's obligation to return any security
deposit. Tenant hereby irrevocably authorizes and directs any such subtenant,
upon receipt of a written notice from Landlord stating that a default exists in
the performance of Tenant's obligations under this Lease, to pay to Landlord the
rents due as they become due under the sublease. Tenant agrees that such
subtenant shall have the right to rely upon any such statement and request from
Landlord, and that such subtenant shall pay such rents to Landlord without any
obligation or right to inquire as to whether such default exists.

                  (b)      In the event Tenant shall default in the performance
of its obligations under this Lease, Landlord, at its option and without any
obligation to do so, may require any subtenant to attorn to Landlord, in which
event Landlord shall undertake the obligations of Tenant under such sublease
from the time of the exercise of said option to the termination of such
sublease; provided, however, Landlord shall not be liable for any prepaid rents
or security deposit paid by such subtenant to Tenant or for any other prior
defaults of Tenant under such sublease.

         16.6     TRANSFER PREMIUM FROM ASSIGNMENT OR SUBLETTING. Landlord shall
be entitled to receive from Tenant (as and when received by Tenant) as an item
of additional rent the following amounts (hereinafter the Transfer Premium):
one-half of all amounts received by Tenant from the subtenant or assignee in
excess of the amounts payable by Tenant to Landlord hereunder. The Transfer
Premium shall be reduced by one-half of the reasonable brokerage commissions,
tenant improvement costs (such tenant improvement costs must be incurred for new
tenant improvements constructed to facilitate the sublease or assignment) and
legal fees actually paid by Tenant in order to assign the Lease or to sublet a
portion of the Premises. "TRANSFER PREMIUM" shall mean all Base Rent, additional
rent or other consideration of any type whatsoever payable by the assignee or
subtenant in excess of the Base Rent and additional rent payable by Tenant under
this Lease. If less than all of the Premises is transferred, the Base Rent and
the additional rent shall be determined on a per-leasable-square-foot basis.
"TRANSFER PREMIUM" shall also include, but not be limited to, key money and
bonus money paid by the assignee or subtenant to Tenant in connection with such
Transfer, and any payment in excess of fair-market value for services rendered
by Tenant to the assignee or subtenant or for assets, fixtures, inventory,
equipment or furniture transferred by Tenant to the assignee or subtenant in
connection with such Transfer.

         16.7     LANDLORD'S OPTION TO RECAPTURE SPACE. Notwithstanding anything
to the contrary contained in this section 16, Landlord shall have the option, by
giving written notice to Tenant within thirty (30) days after receipt of any
request by Tenant to assign this Lease or to sublease more than twenty thousand
(20,000) square feet of space in the Premises to any person or entity other than
an Affiliate (as defined below), to terminate this Lease with respect to said
space as of the date thirty (30) days after Landlord's election. In such event,
Landlord shall reimburse Tenant for 100% of the reasonable brokerage commissions
and legal fees actually paid by Tenant in its effort to assign the Lease or
sublet the Premises. In the event of a recapture by Landlord, if this Lease
shall be canceled with respect to less than the entire Premises, the Base Rent,
Operating Expenses and the number of parking spaces Tenant may use shall be
adjusted on the basis of the number of rentable square feet retained by Tenant
in proportion to the number of rentable square feet contained in the original
Premises, and this Lease as so amended shall continue thereafter in full force
and effect, and upon request of either party, the parties shall execute written
confirmation of same. If Landlord recaptures only a portion of the Premises, it
shall construct and erect at its sole cost such partitions as may be required to
sever the space to be retained by Tenant from the space recaptured by Landlord.
Landlord may, at its option, lease any recaptured portion of the Premises to the
proposed subtenant or assignee or to any other person or entity without
liability to Tenant. Tenant shall not be entitled to any portion of the profit,
if any, Landlord may realize on account of such termination and reletting.
Tenant acknowledges that the purpose of this section is to enable Landlord to
receive profit in the form of higher rent or other consideration to be received
from an assignee or subtenant, to give Landlord the ability to meet additional
space requirements of other tenants of the Project and to permit Landlord to
control the leasing of space in the Project. Tenant acknowledges and agrees that
the requirements of this section are commercially reasonable and are consistent
with the intentions of Landlord and Tenant.

         16.8     LANDLORD'S EXPENSES. In the event Tenant shall assign this
Lease or sublet the Premises or request the consent of Landlord to any Transfer,
then Tenant shall pay Landlord's reasonable costs and expenses incurred in
connection therewith, including, but not limited to, attorneys', architects',
accountants', engineers' or other consultants' fees; provided, however, that
Tenant shall not be obligated to reimburse Landlord for legal fees in excess of
$2,500 with respect to any one Transfer.

         16.9     AFFILIATE TRANSFERS. Notwithstanding anything to the contrary
contained herein, an assignment of the Lease or sublease of all or any portion
of the Premises to any entity which acquires all or substantially all of Tenant,
or which is acquired by Tenant, or which is controlled directly or indirectly by
Tenant, or which entity controls, directly or indirectly, Tenant or which
acquires all or substantially all of the assets of Tenant or which is the
surviving entity resulting from a merger or consolidation of Tenant (in each
such case, an "AFFILIATE"), shall not require Landlord's consent, provided that
at least thirty (30) days prior to such assignment or sublease (i) Tenant
provides Landlord with reasonable evidence that any such entity maintains annual
revenues sufficient to meet the financial obligations hereunder; (ii) Tenant
notifies Landlord in writing of any such assignment or sublease and provides
Landlord with evidence that such assignment or sublease is a Transfer permitted
by this section 16.9; (iii) prior to the date an assignment or sublease will
take effect, the assignee or sublessee and Tenant shall enter into Landlord's
standard consent to sublease agreement or consent to assignment agreement (the
"TRANSFER AGREEMENTS"), provided that such Transfer Agreements do not
substantially alter the terms and conditions of this Lease, and (iv) subject to
the limitation set forth in section 16.8 of the Lease, Tenant shall pay the
reasonable costs and expenses (including legal fees) incurred by Landlord in
confirming that the assignment or sublease meets the requirements of this
section and in preparing any Transfer Agreement. Whether or not an assignment or
sublease to an Affiliate is made pursuant to the terms of this section, Tenant
shall not be relieved of its obligations under this Lease.

                                       11

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17.      DEFAULT; REMEDIES.

         17.1     DEFAULT BY TENANT. Landlord and Tenant hereby agree that the
occurrence of any one or more of the following events is a material default by
Tenant under this Lease and that said default shall give Landlord the rights
described in section 17.2. Landlord or Landlord's authorized agent shall have
the right to execute and to deliver any notice of default, notice to pay rent or
quit or any other notice Landlord gives Tenant.

                  (a)      Tenant's failure to make any payment of Base Rent,
Tenant's Percentage Share of Operating Expenses, Tenant's Percentage Share of
Real Property Taxes or any other payment required to be made by Tenant
hereunder, as and when due, where such failure shall continue for a period of
seven (7) days after written notice thereof from Landlord to Tenant. In the
event that Landlord serves Tenant with a notice to pay rent or quit pursuant to
applicable unlawful detainer statutes, such notice shall also constitute the
notice required by this section 17.1 (a).

                  (b)      The abandonment of the Premises by Tenant for a
period of thirty (30) consecutive days, in which event Landlord shall not be
obligated to give any notice of default to Tenant.

                  (c)      The failure of Tenant to comply with any of its
obligations under sections 16, 25, 26 and 28 where Tenant fails to comply with
its obligations or fails to cure any earlier breach of such obligation within
ten (10) days following written notice from Landlord to Tenant. In the event
Landlord serves Tenant with a notice to quit or any other notice pursuant to
applicable unlawful detainer statutes, said notice shall also constitute the
notice required by this section 17.1(c).

                  (d)      The failure by Tenant to observe or perform any of
the covenants, conditions or provisions of this Lease to be observed or
performed by Tenant (other than those referenced in sections 17.1 (a), (b) and
(c), above), where such failure shall continue for a period of twenty (20) days
after written notice thereof from Landlord to Tenant; provided, however, that if
the nature of Tenant's nonperformance is such that more than twenty (20) days
are reasonably required for its cure, then Tenant shall not be deemed to be in
default if Tenant commences such cure within said twenty (20) day period and
thereafter diligently pursues such cure to completion. In the event that
Landlord serves Tenant with a notice to quit or any other notice pursuant to
applicable unlawful detainer statutes, said notice shall also constitute the
notice required by this section 17.1(d).

                  (e)      (i) The making by Tenant or any guarantor of Tenant's
obligations hereunder of any general arrangement or general assignment for the
benefit of creditors; (ii) Tenant or any guarantor becoming a "debtor" as
defined in 11 U.S.C. 101 or any successor statute thereto (unless, in the case
of a petition filed against Tenant or guarantor, the same is dismissed within
sixty (60) days); (iii) the appointment of a trustee or receiver to take
possession of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where possession is not restored to Tenant
within thirty (30) days; (iv) the attachment, execution or other judicial
seizure of substantially all of Tenant's assets located at the Premises or of
Tenant's interest in this Lease, where such seizure is not discharged within
thirty (30) days; or (v) the insolvency of Tenant. In the event that any
provision of this section 17.1(e) is unenforceable under applicable law, such
provision shall be of no force or effect.

                  (f)      The discovery by Landlord that any financial
statement, representation or warranty given to Landlord by Tenant, or by any
guarantor of Tenant's obligations hereunder, was materially false at the time
given. Tenant acknowledges that Landlord has entered into this Lease in material
reliance on such information.

                  (g)      If Tenant is a corporation, partnership, limited
liability company or similar entity, the dissolution or liquidation of Tenant.

                  (h)      If Tenant's obligations under this Lease are
guaranteed: (i) the death of a guarantor, (ii) the termination of a guarantor's
liability with respect to this Lease other than in accordance with the terms of
such guaranty, (iii) a guarantor's becoming insolvent or the subject of a
bankruptcy filing, (iv) a guarantor's refusal to honor the guaranty, or (v) a
guarantor's breach of its guaranty obligation on an anticipatory breach basis.

         17.2     REMEDIES.

                  (a)      In the event of any material default or breach of
this Lease by Tenant that is not remedied by Tenant within the applicable cure
period, Landlord may, at any time thereafter, with or without notice or demand,
and without limiting Landlord in the exercise of any right or remedy which
Landlord may have by reason of such default:

                           (i)      terminate Tenant's right to possession of
the Premises by any lawful means, in which case this Lease and the term hereof
shall terminate and Tenant shall immediately surrender possession of the
Premises to Landlord. If Landlord terminates this Lease, Landlord may recover
from Tenant (A) the worth at the time of award of the unpaid rent which had been
earned at the time of termination; (B) the worth at the time of award of the
amount by which the unpaid rent which would have been earned after termination
until the time of award exceeds the amount of such rental loss that Tenant
proves could have been reasonably avoided; (C) the worth at the time of award of
the amount by which the unpaid rent for the balance of the term after the time
of award exceeds the amount of such rental loss that Tenant proves could have
been reasonably avoided; and (D) any other amount necessary to compensate
Landlord for all detriment proximately caused by Tenant's failure to perform its
obligations under the Lease or which in the ordinary course of things would be
likely to result therefrom, including, but not limited to, the cost of
recovering possession of the Premises, expenses of releasing, including
necessary renovation and alteration of the Premises, reasonable attorneys' fees,
any real estate commissions actually paid by Landlord and the unamortized value
of any free rent, reduced rent, tenant Improvement allowance or other economic
concessions provided by Landlord. The "worth at time of award" of the amounts
referred to in section 17.2(a)(i)(A) and (B) shall be computed by allowing
interest at the lesser of ten percent (10%) per annum or the maximum interest
rate permitted by applicable law. The worth at the time of award of the amount
referred to in section 17.2(a)(i)(C) shall be computed by discounting such
amount at the discount rate of the Federal Reserve Bank of San Francisco at the
time of award plus one percent (1%). For purposes of this section 17.2(a)(i),
"rent" shall be deemed to be all monetary obligations required to be paid by
Tenant pursuant to the terms of this Lease.

                           (ii)     maintain Tenant's right of possession, in
which event Landlord shall have the remedy described in California Civil Code
section 1951.4 which permits Landlord to continue this Lease in effect after
Tenant's breach and abandonment and recover rent as it becomes due. In the event
Landlord elects to continue this Lease in effect. Tenant shall have the right to
sublet the Premises or assign Tenant's interest in the Lease subject to the
reasonable requirements contained in section 16 of this Lease and provided
further that Landlord shall not require compliance with any standard or
condition contained in section 16 that has become unreasonable at the time
Tenant seeks to sublet or assign the Premises pursuant to this section
17.2(a)(ii).

                           (iii)    collect sublease rants (or appoint a
receiver to collect such rent) and otherwise perform Tenant's obligations at the
Premises, it being agreed, however, that the appointment of a receiver for
Tenant shall not constitute an election by Landlord to terminate this Lease.

                                         12

<PAGE>

                           (iv)     pursue any other remedy now or hereafter
available to Landlord under the laws or judicial decisions of the state in which
the Premises are located.

                  (b)      No remedy or election hereunder shall be deemed
exclusive, but shall, wherever possible, be cumulative with all other remedies
at law or in equity. The expiration or termination of this Lease and/or the
termination of Tenant's right to possession of the Premises shall not relieve
Tenant of liability under any indemnity provisions of this Lease as to matters
occurring or accruing during the term of the Lease or by reason of Tenant's
occupancy of the Premises.

                  (c)      If Tenant abandons or vacates the Premises, Landlord
may re-enter the Premises, and such re-entry shall not be deemed to constitute
Landlord's election to accept a surrender of the Premises or to otherwise
relieve Tenant from liability for its breach of this Lease. No surrender of the
Premises shall be effective against Landlord unless Landlord has entered into a
written agreement with Tenant in which Landlord expressly agrees to (i) accept a
surrender of the Premises and (ii) relieve Tenant of liability under the Lease.
The delivery by Tenant to Landlord of possession of the Premises shall not
constitute the termination of the Lease or the surrender of the Premises.

         17.3     DEFAULT BY LANDLORD. Landlord shall not be in default under
this Lease unless Landlord falls to perform obligations required of Landlord
within thirty (30) days after written notice by Tenant to Landlord and to the
holder of any mortgage or deed of trust encumbering the Project whose name and
address shall have theretofore been furnished to Tenant in writing, specifying
wherein Landlord has failed to perform such obligation; provided, however, that
if the nature of Landlord's obligation is such that more than thirty (30) days
are required for its cure, then Landlord shall not be in default if Landlord
commences performance within such thirty (30) day period and thereafter
diligently pursues the same to completion. Tenant hereby waives its right to
recover consequential damages (including, but not limited to, lost profits) or
punitive damages arising out of a Landlord default. This Lease and the
obligations of Tenant hereunder shall not be affected or impaired because
Landlord is unable to fulfill any of its obligations hereunder or is delayed in
doing so, if such inability or delay is caused by reason of a Force Majeure
Event, and the time for Landlord's performance shall be extended for the period
of any such delay.

         17.4     LATE CHARGES. Tenant hereby acknowledges that late payment by
Tenant to Landlord of Base Rent, Tenant's Percentage Share of Operating Expenses
or other sums due hereunder will cause Landlord to incur costs not contemplated
by this Lease, the exact amount of which will be extremely difficult to
ascertain. Such costs include, but are not limited to, processing and accounting
charges and late charges which may be imposed on Landlord by the terms of any
mortgage or trust deed encumbering the Project. Accordingly, if any installment
of Base Rent, Tenant's Percentage Share of Operating Expenses or any other sum
due from Tenant shall not be received by Landlord within five (5) days after
such amount shall be due, then, without any requirement for notice or demand to
Tenant, Tenant shall immediately pay to Landlord a late charge equal to five
percent (5%) of such overdue amount. Notwithstanding the forgoing, Tenant shall
not be obligated to pay to Landlord a late charge the first time in any twelve
(12) month period that Tenant fails to pay to Landlord a sum due hereunder
within five (5) days after such sum is due. The parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs Landlord will
incur by reason of late payment by Tenant. Acceptance of such late charge by
Landlord shall in no event constitute a waiver of Tenant's default with respect
to such overdue amount, nor prevent Landlord from exercising any of the other
rights and remedies granted hereunder, including the assessment of interest
under section 17.5.

         17.5     INTEREST ON PAST-DUE OBLIGATIONS. Except as expressly herein
provided, any amount due to Landlord that is not paid when due shall bear
Interest at the lesser of ten percent (10%) per annum or the maximum rate
permitted by applicable law. Payment of such interest shall not excuse or cure
any default by Tenant under this Lease; provided, however, that interest shall
not be payable on late charges Incurred by Tenant nor on any amounts upon which
late charges are paid by Tenant.

         17.6     PAYMENT OF RENT AND SECURITY DEPOSIT AFTER DEFAULT. If Tenant
fails to pay Base Rent Tenant's Percentage Share of Operating Expenses, parking
charges or any other monetary obligation due hereunder on the date it is due,
after Tenant's third failure to pay any monetary obligation on the date it is
due in any calendar year, at Landlord's option, all monetary obligations of
Tenant hereunder shall thereafter be paid by cashier's check. If Landlord has
required Tenant to make said payments by cashier's check, Tenant's failure to
make a payment by cashier's check shall be a material default hereunder.

18.      LANDLORD'S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT. All covenants and
agreements to be kept or performed by Tenant under this Lease shall be performed
by Tenant at Tenant's sole cost and expense and without any reduction of rent.
If Tenant shall fail to perform any of its obligations under this Lease after
expiration of any applicable cure period, Landlord may, but shall not be
obligated to, after ten (10) days' prior written notice to Tenant, make any such
payment or perform any such act on Tenant's behalf without waiving its rights
based upon any default of Tenant and without releasing Tenant from any
obligations hereunder. Tenant shall pay to Landlord, within ten (10) days after
delivery by Landlord to Tenant of statements therefore, an amount equal to the
expenditures reasonably made by Landlord in connection with the remedying by
Landlord of Tenant's defaults pursuant to the provisions of this section.

19.      INDEMNITY. Because Tenant is required to insure all of the tenant
improvements in its Premises and its furniture, fixtures and equipment and
because of the requirements to provide waivers of subrogation, Tenant hereby
assumes all risk of damage to property in its Premises. Tenant agrees that
Landlord, its partners, subpartners, parent organization, affiliate, subsidiary,
and their respective officers, directors, legal representatives, successors,
assigns, agents, servants, employees, and independent contractors and each of
them (collectively, "Landlord Parties") shall not be liable to Tenant for, and
are hereby released from any responsibility to Tenant for, any damage either to
persons in the Premises or property of Tenant in the Premises or resulting from
the loss of use thereof, which damage is sustained by Tenant or by other persons
claiming through Tenant (including Tenant Parties), except for damage to
property which Landlord insures or is required to insure pursuant to the terms
and conditions of this Lease and except for injury to persons to the extent
caused by the negligence or willful misconduct of the Landlord Parties. Tenant
shall indemnify, defend, protect, and hold harmless the Landlord Parties from
any and all loss, cost, damage, expense and liability (including without
limitation court costs and reasonable attorneys' fees) (collectively, "Claims")
incurred in connection with or arising from any cause in or on the Premises, any
acts, omissions or negligence of Tenant or of any person claiming by, through or
under Tenant, partners, subpartners, parent organization, affiliate, subsidiary
and their respective officers, directors, contractors, agents, servants,
employees, invitees, guests or licensees of Tenant and each of them
(collectively, "Tenant Parties") or any such person, in or on the Project,
provided that notwithstanding the foregoing, Tenant shall not be required to
indemnify, defend, protect or hold Landlord harmless from any Claims (i) by any
person, company or entity resulting from the negligence or willful misconduct
the Landlord Parties in connection with the Landlord Parties' activities in the
Building or the Project (except for damage to the tenant improvements, and
Tenant's personal property, fixtures, furniture and equipment in the Premises,
to the extent Tenant is required to obtain the requisite insurance coverage
pursuant to this Lease for any such tenant improvements or personal property,
fixtures, furniture or equipment). Landlord shall indemnify, defend, protect and
hold harmless Tenant and Tenant Parties from any Claim resulting from injuries
to persons or property caused by the negligence of willful misconduct of
Landlord and/or its agents and employees Notwithstanding anything to the
contrary in this Lease, in no event shall Landlord be obligated to indemnify
Tenant for consequential damages (including, but not limited to, lost profits)
or punitive damages. Except as otherwise provided in this Lease, Tenant shall
not be obligated to indemnify Landlord for consequential damages (including, but
not limited to, lost profits) or punitive damages.

                                       13
<PAGE>

20.      EXEMPTION OF LANDLORD FROM LIABILITY. Except as otherwise provided in
this Lease, Tenant hereby agrees that Landlord shall not be liable for injury to
Tenant's business or any loss of Income therefrom or for loss of or damage to
the merchandise, tenant improvements, fixtures, furniture, equipment, computers,
flies, automobiles, or other property of Tenant, Tenant's employees, agents,
contractors or invitees, or any other person in or about the Project, nor shall
Landlord be liable for Injury to the person of Tenant, Tenants employees,
agents, contractors or invitees, whether such damage or injury is caused by or
results from any cause whatsoever including, but not limited to, theft, criminal
activity at the Project, negligent security measures, bombings or bomb scares,
Hazardous Materials, fire, steam, electricity, gas, water or rain, flooding,
breakage of pipes, sprinklers, plumbing, air conditioning or lighting fixtures,
or from any other cause, whether said damage or injury results from conditions
arising upon the Premises or upon other portions of the Project, or from other
sources or places, or from new construction or the repair, alteration or
improvement of any part of the Project, and regardless of whether the cause of
the damage or injury arises out of Landlord's or its employees', agents' or
contractors' negligent or intentional acts. Landlord shall not be liable for any
damages arising from any act or neglect of any employees, agents, contractors or
invitees of any other tenant, occupant or user of the Project, nor from the
failure of Landlord to enforce the provisions of the lease of any other tenant
of the Project. Except as otherwise provided in this Lease, Tenant, as a
material part of the consideration to Landlord hereunder, hereby assumes all
risk of damage to Tenant's property or business or injury to persons In, upon or
about the Project arising from any cause, including Landlord's negligence or the
negligence of Its employees, agents or contractors, and Tenant hereby waives all
claims in respect thereof against Landlord, its employees, agents and
contractors.

21.      LANDLORD'S LIABILITY. Tenant acknowledges that Landlord shall have the
right to transfer all or any portion of its interest in the Project and to
assign this Lease to the transferee. Tenant agrees that in the event of such a
transfer Landlord shall automatically be released from all liability under this
Lease arising after the date of such transfer; and Tenant hereby agrees to look
solely to Landlord's transferee for the performance of Landlord's
obligations hereunder after the date of the transfer. Upon such a transfer,
Landlord shall, at its option, return Tenants security deposit to Tenant or
transfer Tenant's security deposit to Landlord's transferee and, in either
event, Landlord shall have no further liability to Tenant for the return of its
security deposit. Subject to the rights of any lender holding a mortgage or deed
of trust encumbering all or part of the Project, Tenant agrees to look solely to
Landlord's equity interest in the Project for the collection of any judgment
requiring the payment of money by Landlord arising out of (a) Landlord's failure
to perform its obligations under this Lease or (b) the negligence or willful
misconduct of Landlord, its partners, employees and agents; provided, however,
if Landlord's equity interest in the Property is less than One Million Dollars
($1,000,000), Tenant shall have the right to seek recovery from the other assets
of Landlord; provided, further, in no event shall Tenant have the right to
recover damages or obtain a judgment against Landlord's other assets in an
amount in excess of the Differential Amount (as defined below). The
"DIFFERENTIAL AMOUNT" shall mean the difference in dollars between One Million
Dollars ($1,000,000.00) and the amount of equity Landlord has in the Project
(e.g., if Landlord has $900,000 of equity in the Project, the Differential
Amount would be $100,000). No other property or assets of Landlord shall be
subject to levy, execution or other enforcement procedure for the satisfaction
of any judgment or writ obtained by Tenant against Landlord. No partner,
employee or agent of Landlord shall be personally liable for the performance of
Landlord's obligations hereunder or be named as a party in any lawsuit arising
out of or related to, directly or indirectly, this Lease and the obligations of
Landlord hereunder. The obligations under this Lease do not constitute personal
obligations of the individual partners of Landlord, if any, and Tenant shall not
seek recourse against the individual partners of Landlord or their assets.

22.      SIGNS. Tenant shall not make any changes to the exterior of the
Premises, install any exterior lights, decorations, balloons, flags, pennants,
banners or painting, or erect or install any signs, windows or door lettering,
placards, decorations or advertising media of any type which can be viewed from
the exterior of the Premises, without Landlord's prior written consent, which
may be given or withheld in Landlord's sole discretion; provided, however, that
Tenant shall have the right to post on the Premises and Tenant's equipment signs
required by law. Landlord hereby approves Tenant's signs that are in existence
on the date of this Lease and which are attached to the Premises. Upon vacation
of the Premises, Tenant shall remove all signs and repair, paint and/or replace
the building facia surface to which its signs are attached. Tenant shall obtain
all applicable governmental permits and approvals for signs and exterior
treatments. All signs, decorations, advertising media, blinds, draperies and
other window treatment or bars or other security installations visible from
outside the Premises shall be subject to Landlord's approval and conform in all
respects to Landlord's requirements.

23.      PARKING. During the term and subject to the rules and regulations
attached hereto as Exhibit "C," as modified by Landlord from time to time (the
"RULES"), Tenant shall be entitled to use the number of parking spaces set forth
in section 1.13 in the Common Area parking lot of the Project. Tenant's parking
rights are in common with the parking rights of any other tenants of the
Project, and all of Tenant's parking spaces are unreserved parking spaces.
Landlord reserves the right at any time to designate areas in the Common Areas
where Tenant may or may not park. If Tenant commits or allows in the parking lot
any of the activities prohibited by the Lease or the Rules, then Landlord shall
have the right, with prior telephonic notice to Tenant's manager at the
Premises, in addition to such other rights and remedies that it may have, to
remove or tow away the vehicle involved and charge the cost to Tenant, which
cost shall be immediately payable by Tenant upon demand by Landlord. Tenant's
parking rights are the personal rights of Tenant, and Tenant shall not transfer,
assign or otherwise convey its parking rights separate and apart from this
Lease. All parking spaces may only be used for parking vehicles no larger than
full-size passenger automobiles or pick-up trucks. Landlord, in addition to its
other remedies, shall have the right to remove or tow away any other vehicles,
Landlord shall not be responsible for enforcing Tenant's parking rights against
any third parties provided, however, if another tenant is interfering with
Tenant's parking rights, Landlord shall cooperate with Tenant in attempting to
cause the tenant to end such interference, provided, further, that Landlord
shall have no obligation to bring a legal action against the non-complying
tenant. Tenant shall not permit or allow any vehicles that belong to or are
controlled by Tenant or Tenant's employees, suppliers, shippers, customers or
invitees to be loaded, unloaded or parked in areas other than those designated
by Landlord for such activities.

24.      BROKER'S FEE. Tenant and Landlord each represent and warrant to the
other that neither has had any dealings or entered into any agreements with any
person, entity, broker or finder other than the persons, if any, listed in
section 1.14, in connection with the negotiation of this Lease, and no other
broker, person, or entity is entitled to any commission or finder's fee in
connection with the negotiation of this Lease, and Tenant and Landlord each
agree to indemnify, defend and hold the other harmless from and against any
claims, damages, costs, expenses, attorneys' fees or liability for compensation
or charges which may be claimed by any such unnamed broker, finder or other
similar party by reason of any dealings, actions or agreements of the
indemnifying party. The commission payable to Landlord's broker with respect to
this Lease shall be pursuant to the terms of the separate commission agreement
in effect between Landlord and Landlord's broker. Landlord's broker shall pay a
portion of its commission to Tenant's broker, if so provided in any agreement
between Landlord's broker and Tenant's broker. Nothing in this Lease shall
impose any obligation on Landlord to pay a commission or fee to any party other
than Landlord's broker.

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25. ESTOPPEL CERTIFICATE.

         25.1     DELIVERY OF CERTIFICATE. Tenant shall from time to time, upon
not less than ten (10) business days' prior written notice from Landlord,
execute, acknowledge and deliver to Landlord a statement in writing certifying
such information as Landlord may reasonably request including, but not limited
to, the following: (a) that this Lease is unmodified and in full force and
effect (or, if modified, stating the nature of such modification and certifying
that this Lease, as so modified, is in full force and effect), (b) the date to
which the Base Rent and other charges are paid in advance and the amounts so
payable, (c) that there are not, to Tenant's knowledge, any uncured defaults or
unfulfilled obligations on the part of Landlord, or specifying such defaults or
unfulfilled obligations, if any are claimed, (d) that all tenant improvements to
be constructed by Landlord, if any, have been completed in accordance with
Landlord's obligations, and (e) that Tenant has taken possession of the
Premises. Any such statement may be conclusively relied upon by any prospective
purchaser or encumbrancer of the Project.

         25.2     FAILURE TO DELIVER CERTIFICATE. If Tenant fails to deliver
such statement within such time, after Landlord provides Tenant with a written
notice of default pursuant to section 17.1(c), and after Tenant fails to cure
such default in the applicable ten (10) day cure period, at Landlord's option,
Landlord may treat such failure as (a) a material default of Tenant hereunder,
or (b) it shall be conclusive upon Tenant that (i) this Lease is in full force
and effect, without modification except as may be represented by Landlord, (ii)
there are no uncured defaults in Landlord's performance, (iii) not more than one
month's Base Rent has been paid in advance, (iv) all tenant improvements to be
constructed by Landlord, if any, have been completed in accordance with
Landlord's obligations, and (v) Tenant has taken possession of the Premises.

26.      FINANCIAL INFORMATION. From time to time, at Landlord's request, but
not more often than once in any twelve month period, Tenant shall cause the
following financial information to be delivered to Landlord, at Tenant's sole
cost and expense, upon not less than ten (10) business days' advance written
notice from Landlord: (a) a current financial statement for Tenant and Tenant's
financial statements for the previous two accounting years and (b) a current
financial statement for any guarantor(s) of this Lease and the guarantor'(s)
financial statements for the previous two accounting years. All financial
statements shall be prepared in accordance with generally accepted accounting
principals consistently applied and, if such is the normal practice of Tenant,
shall be audited by an independent certified public accountant. Tenant hereby
authorizes Landlord, from time to time, without notice to Tenant, to obtain a
credit report or credit history on Tenant from any credit reporting company.

27.      ENVIRONMENTAL MATTERS/HAZARDOUS MATERIALS.

         27.1     HAZARDOUS MATERIALS DISCLOSURE CERTIFICATE. Prior to executing
this Lease, Tenant has delivered to Landlord Tenant's executed initial Hazardous
Materials Disclosure Certificate (the "INITIAL HAZMAT CERTIFICATE"), a copy of
which is attached hereto as Exhibit D. Tenant covenants, represents and warrants
to Landlord that the information in the initial HazMat Certificate is true and
correct and accurately describes the use(s) of Hazardous Materials which will be
made and/or used on the Premises by Tenant. If requested in writing from
Landlord or if Tenant's use of Hazardous Materials has materially changed from
previously submitted information in the Hazardous Materials Disclosure
Certificate, Tenant shall deliver to Landlord an executed Hazardous Materials
Disclosure Certificate (the "HAZMAT CERTIFICATE") describing Tenant's
then-present use of Hazardous Materials on the Premises, and any other
reasonably necessary documents and information as requested by Landlord. The
HazMat Certificates required hereunder shall be in substantially the form
attached hereto as Exhibit D.

         27.2     DEFINITION OF HAZARDOUS MATERIALS. As used in this Lease, the
term Hazardous Materials shall mean and include (a) any hazardous or toxic
wastes, materials or substances, and other pollutants or contaminants, which are
or become regulated by any Environmental Laws (defined below); (b) petroleum,
petroleum by-products, gasoline, diesel fuel, crude oil or any fraction thereof;
(c) asbestos and asbestos-containing material, in any form, whether friable or
non-friable; (d) polychlorinated biphenyls; (e) radioactive materials; (f) lead
and lead-containing materials; (g) any other material, waste or substance
displaying toxic, reactive, ignitable or corrosive characteristics, as all such
terms are used in their broadest sense, and are defined or become defined by any
Environmental Law; or (h) any materials which cause or threatens to cause a
nuisance upon or waste to any portion of the Project or any surrounding
property; or poses or threatens to pose a hazard to the health and safety of
persons on the Premises, any other portion of the Project or any surrounding
property. For purposes of this Lease, the term "Hazardous Materials" shall not
include nominal amounts of ordinary household cleaners, office supplies,
janitorial supplies and such similar materials and substances which are not
actionable under any existing or future Environmental Laws.

         27.3     PROHIBITION; ENVIRONMENTAL LAWS. Tenant shall not be entitled
to use or store any Hazardous Materials on, in, or about any portion of the
Premises and the Project without, in each instance, obtaining Landlord's prior
written consent thereto unless such Hazardous Materials are disclosed and
approved in accordance with section 27.1 above. If Landlord, in its sole
discretion, consents to any such usage or storage, then Tenant shall be
permitted to use and/or store only those Hazardous Materials that are necessary
for Tenant's business and to the extent disclosed in the HazMat Certificate and
as expressly approved by Landlord in writing. Any such usage and storage may
only be to the extent of the quantities of Hazardous Materials as specified in
the then-applicable HazMat Certificate as expressly approved by Landlord. In all
events such usage and storage must at all times be in full compliance with any
and all local, state and federal environmental, health and/or safety-related
laws, statutes, orders, standards, courts' decisions, ordinances, rules and
regulations (as interpreted by judicial and administrative decisions), decrees,
directives, guidelines, permits or permit conditions, currently existing and as
amended, enacted, issued or adopted in the future which are or become applicable
to Tenant or all or any portion of the Premises (collectively, the
"ENVIRONMENTAL LAWS") and in compliance with the reasonable industry standard
recommendations of Landlord's consultants. Tenant agrees that any material
changes to the type and/or quantities of Hazardous Materials specified in the
most recent HazMat Certificate may be implemented only with the prior written
consent of Landlord, which consent may be given or withheld in Landlord's
reasonable discretion. By way of example and not limitation, it shall be
reasonable for Landlord to withhold its consent to the use of different
Hazardous Materials if such use (a) increases the chance of contamination of the
Project, (b) the Hazardous Material increases risks to occupants of the Project,
(c) Landlord's environmental consultant does not approve the use of the
Hazardous Material based on reasonable industry standards, (d) Landlord's
insurance carrier objects to the use of the Hazardous Material or (e) Tenant
will not implement all reasonable industry standard safety and handling
recommendations made by Landlord relating to the use of the Hazardous Material.
Assignees and subtenants of Tenant shall not have the right to use additional
Hazardous Materials at the Premises, and Landlord shall have no obligation to
consent to the use of additional Hazardous Materials to accommodate any assignee
or subtenant; provided that this limitation shall not apply to assignees or
subtenants who are Affiliates. Tenant shall not be entitled nor permitted to
install any tanks under, on or about the Premises for the storage of Hazardous
Materials without the express written consent of Landlord, which may be given or
withheld in Landlord's sole discretion. Landlord shall have the right, in
Landlord's sole discretion, at upon prior reasonable notice during the Term of
this Lease to (i) inspect the Premises, (ii) conduct tests and investigations to
determine whether Tenant is in compliance with the provisions of this section 27
or to determine if Hazardous Materials used or stored by Tenant are present in,
on or about the Project, (iii) request lists of all Hazardous Materials used,
stored or otherwise located on, under or about any portion of the Premises
and/or the Common Areas by Tenant, and (iv) if Landlord reasonably believes that
Tenant is not in compliance with the requirements of this section, to require
Tenant to complete a survey of its use, storage and handling of Hazardous
Materials in the Premises, using a form and following procedures satisfactory to
Landlord, in Landlord's reasonable discretion (the

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"SURVEY"). Tenant shall reimburse landlord for the cost of all such inspections,
tests and investigations, and all reasonable costs associated with any Survey if
it is determined that Tenant is not in compliance with applicable Environmental
Laws or the requirements of this section. If as a result of an inspection, test
or Survey Landlord determines, in Landlord's reasonable discretion, that Tenant
should implement or perform commercially reasonable industry standard safety,
security or compliance measures, Tenant shall within thirty (30) days after
written request by Landlord perform such measures, at Tenant's sole cost and
expense. The aforementioned rights granted herein to Landlord and its
representatives shall not create (a) a duty on Landlord's part to inspect, test,
investigate, monitor or otherwise observe the Premises or the activities of
Tenant and Tenant Parties with respect to Hazardous Materials, including without
limitation, Tenant's operation, use and any remediation relating thereto, or (b)
liability on the part of Landlord and its representatives for Tenant's use,
storage, disposal or remediation of Hazardous Materials, it being understood
that Tenant shall be solely responsible for all liability in connection
therewith.

         27.4     TENANT'S ENVIRONMENTAL OBLIGATIONS. Tenant shall give to
Landlord Immediate verbal and follow-up written notice of any spills, releases,
discharges, disposals, emissions, migrations, removals or transportation of
Hazardous Materials on, under or about any portion of the Premises or in any
Common Areas; provided that Tenant has actual knowledge of such event(s) and
such events might adversely effect the Premises or the Project. Tenant, at its
sole cost and expense, covenants and warrants to promptly investigate, clean up,
remove, restore and otherwise remediate (including, without limitation,
preparation of any feasibility studies or reports and the performance of any and
all closures) any spill, release, discharge, disposal, emission, migration or
transportation of Hazardous Materials arising from or related to the intentional
or negligent acts or omissions of Tenant or Tenant Parties such that the
affected portions of the Project and any adjacent property are returned to the
condition existing prior to the appearance of such Hazardous Materials. Any such
investigation, clean up, removal, restoration and other remediation shall only
be performed after Tenant has obtained Landlord's prior written consent, which
consent shall not be unreasonably withheld so long as such actions would not
potentially have a material adverse long-term or short-term effect on any
portion of the Project. Notwithstanding the foregoing, Tenant shall be entitled
to respond immediately to an emergency without first obtaining Landlord's prior
written consent. Tenant, at its sole cost and expense, shall conduct and
perform, or cause to be conducted and performed, all closures as required by any
Environmental Laws or any agencies or other governmental authorities having
jurisdiction thereof. If Tenant falls to so promptly investigate, clean up,
remove, restore, provide closure or otherwise so remediate. Landlord may, but
without obligation to do so, take any and all steps necessary to rectify the
same, and Tenant shall promptly reimburse Landlord, upon demand, for all costs
and expenses to Landlord of performing investigation, cleanup, removal,
restoration, closure and remediation work. All such work undertaken by Tenant,
as required herein, shall be performed in such a manner so as to enable Landlord
to make full economic use of the Premises and other portions of the Project
after the satisfactory completion of such work.

         27.5     ENVIRONMENTAL INDEMNITY. In addition to Tenant's other
indemnity obligations under this Lease, Tenant agrees to, and shall, protect,
indemnify, defend (with counsel reasonably acceptable to Landlord) and hold
Landlord and the other indemnitees harmless from and against any and all loss,
cost, damage, liability or expense (including, without limitation, diminution in
value of any portion of the Premises or the Project, damages for the loss of or
restriction on the use of rentable or usable space, and from any adverse impact
of Landlord's marketing of any space within the Project) arising at any time
during or after the term of this Lease in connection with or directly related to
Tenant's use, the presence of, transportation, storage, disposal, migration,
removal, spill, release or discharge of Hazardous Materials on, in or about any
portion of the Project as a direct result of the intentional or negligent acts
or omissions of Tenant or Tenant Parties. Neither the written consent of
Landlord to the presence, use or storage of Hazardous Materials in, on, under or
about any portion of the Project nor the strict compliance by Tenant with all
Environmental Laws shall excuse Tenant from its obligations of indemnification
pursuant hereto. Tenant shall not be relieved of its indemnification obligations
under the provisions of this section 27.5 due to Landlord's status as either an
"owner" or "operator" under any Environmental Laws. Notwithstanding anything to
the contrary herein, Landlord agrees that Tenant will not be liable to Landlord
(and Landlord releases and agrees not to sue Tenant) with respect to any claims,
losses, damages, liabilities, costs, legal fees and expenses arising out of or
relating to the presence of any Hazardous Materials to the extent not caused by
Tenant or Tenant Parties.

         27.6     SURVIVAL. This section 27 shall survive the expiration or
earlier termination of this Lease.

28.      SUBORDINATION.

         28.1     EFFECT OF SUBORDINATION. This Lease, and any Option (as
defined below) granted hereby, upon Landlord's written election, shall be
subject and subordinate to any ground lease, mortgage, deed of trust or any
other hypothecation or security now or hereafter placed upon the Project and to
any and all advances made on the security thereof and to all renewals,
modifications, consolidations, replacements and extensions thereof.
Notwithstanding such subordination, Tenant's right to quiet possession of the
Premises shall not be disturbed so long as Tenant shall pay the rent and observe
and perform all of the provisions of this Lease, unless this Lease is otherwise
terminated pursuant to its terms. At the request of any mortgagee, trustee or
ground lessor, Tenant shall attorn to such person or entity. If any mortgagee,
trustee or ground lessor shall elect to have this Lease and any Options granted
hereby prior to the lien of its mortgage, deed of trust or ground lease, and
shall give written notice thereof to Tenant, this Lease and such Options shall
be deemed prior to such mortgage, deed of trust or ground lease, whether this
Lease or such Options are dated prior or subsequent to the date of said
mortgage, deed of trust or ground lease or the date of recording thereof. In the
event of the foreclosure of a security device, the new owner shall not (a) be
liable for any act or omission of any prior landlord or with respect to events
occurring prior to its acquisition of title, (b) be liable for the breach of
this Lease by any prior landlord or(c) (d) be liable to Tenant for the return of
its security deposit; provided, however, that the forgoing shall not release
Landlord from its obligation to return any security deposit to Tenant.

         28.2     EXECUTION OF DOCUMENTS. Tenant agrees to execute and
acknowledge any accurate and commercially reasonable documents Landlord requests
Tenant execute to effectuate an attornment a subordination, or to make this
Lease or any Option granted herein prior to the lien of any mortgage, deed of
trust or ground lease, as the case may be. Tenant's failure to execute such
documents within ten (10) days after written demand shall constitute a material
default by Tenant hereunder.

29.      OPTIONS.

         29.1     DEFINITION. As used in this Lease, the word "OPTION" has the
following meaning: (1) the right or option to extend the term of this Lease or
to renew this Lease, (2) the option or right of first refusal to lease the
Premises or the right of first offer to lease the Premises or the right of first
refusal to lease other space within the Project or the right of first offer to
lease other space within the Project, and (3) the right or option to terminate
this Lease prior to its expiration date or to reduce the size of the Premises.
Any Option granted to Tenant by Landlord must be evidenced by a written option
agreement attached to this Lease as a rider or addendum or said option shall be
of no force or effect.

         29.2     OPTIONS PERSONAL. Each Option granted to Tenant in this Lease,
if any, is personal to the original Tenant and any assignee that is an Affiliate
and may be exercised only by the original Tenant or such an Affiliate while
occupying the entire Premises and may not be exercised or be assigned,
voluntarily or involuntarily, by or to any person or entity other than Tenant or
an Affiliate, including, without limitation, any permitted transferee as defined
in section 16. The Options, if any, herein granted to Tenant are not assignable
separate and apart from this Lease, nor may any Option be separated from this

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Lease in any manner, either by reservation or otherwise. If at any time an
Option is exercisable by Tenant or an Affiliate, the Lease has been assigned or
a sublease exists as to any portion of the Premises to an entity other than an
Affiliate, the Option shall be deemed null and void and neither Tenant, an
Affiliate or any assignee or subtenant shall have the right to exercise the
Option.

         29.3     MULTIPLE OPTIONS. In the event that Tenant has multiple
Options to extend or renew this Lease, a later Option cannot be exercised unless
the prior Option to extend or renew this Lease has been so exercised.

         29.4     EFFECT OF DEFAULT ON OPTIONS. Tenant shall have no right to
exercise an Option (i) during the time commencing from the date Landlord gives
to Tenant a notice of default pursuant to section 17.1 and continuing until the
noncompliance alleged in said notice of default is cured, or (ii) if Tenant is
in default of any of the terms, covenants or conditions of this Lease. The
period of time within which an Option may be exercised shall not be extended or
enlarged by reason of Tenants inability to exercise an Option because of the
provisions of this section.

         29.5     LIMITATIONS ON OPTIONS. Notwithstanding anything to the
contrary contained in any rider or addendum to this Lease, any options, rights
of first refusal or rights of first offer granted hereunder shall be subject and
secondary to Landlord's right to first offer and lease any such space to any
tenant who is then occupying or leasing such space at the time the space becomes
available for leasing and shall be subject and subordinated to any other
options, rights of first refusal or rights of first offer previously given to
any other person or entity.

         29.6     GUARANTEES. Notwithstanding anything to the contrary contained
in any rider or addendum to this Lease, Tenant's right to exercise and the
effectiveness of an Option is conditioned upon Landlord's receipt from any prior
tenant that has not been expressly released from liability under this Lease, and
any guarantor of any obligation of Tenant under this Lease, of a written
agreement reaffirming such person's obligations under this Lease or the
guaranty, as modified by Tenant's exercise of the Option.

30.      LANDLORD RESERVATIONS. Landlord shall have the right: (a) to change the
name and address of the Project or Building upon not less than ninety (90) days
prior written notice; provided, however, in such event Landlord shall reimburse
Tenant for all reasonable costs Tenant pays to third parties for the replacement
of pre-printed stationary, address labels and other packaging in an amount not
to exceed $10,000; (b) to permit any tenant the exclusive right to conduct any
business as long as such exclusive right does not conflict with any rights
expressly given herein; and (c) to place signs, notices or displays upon the
roof, interior or exterior of the Building (provided such signage does not
unreasonably interfere with Tenant's use of the Premises or with Tenant's
signage as permitted by this Lease) or Common Areas of the Project. Landlord
reserves the right to use the exterior walls of the Premises, and the area
beneath, adjacent to and above the Premises together with the right to install,
use, maintain and replace equipment, machinery, pipes, conduits and wiring
through the Premises, which serve other parts of the Project provided that
Landlord's use does not unreasonably interfere with Tenant's use and does not
materially diminish the general appearance of the Premises.

31.      CHANGES TO PROJECT. Landlord shall have the right, in Landlord's sole
discretion, from time to time, to make changes to the size, shape, location,
number and extent of the improvements comprising the Project (hereinafter
referred to as "CHANGES") including, but not limited to, the interior and
exterior of buildings, the Common Areas, HVAC, electrical systems, communication
systems, fire protection and detection systems, plumbing systems, security
systems, parking control systems, driveways, entrances, parking spaces, parking
areas and landscaped areas. In connection with the Changes, Landlord may, among
other things, erect scaffolding or other necessary structures at the Project,
limit or eliminate access to portions of the Project, including portions of the
Common Areas, or perform work in the Building, which work may create noise, dust
or leave debris in the Building. Tenant hereby agrees that such Changes and
Landlord's actions in connection with such Changes shall in no way constitute a
constructive eviction of Tenant or entitle Tenant to any abatement of rent.
Landlord shall have no responsibility or for any reason be liable to Tenant for
any direct or indirect injury to or interference with Tenant's business arising
from the Changes, nor shall Tenant be entitled to any compensation or damages
from Landlord for any inconvenience or annoyance occasioned by such Changes or
Landlord's actions in connection with such Changes. If a Change will materially
interfere with Tenant's use of the Premises, Landlord shall provide Tenant with
reasonable advance notice of such Change. Landlord will cooperate with Tenant in
a reasonable manner to schedule such Changes and shall use commercially
reasonable efforts to minimize disruption to Tenant's business operations caused
by Changes.

32.      Intentionally deleted.

33.      HOLDING OVER. If Tenant remains in possession of the Premises or any
part thereof after the expiration or earlier termination of the term hereof with
Landlord's consent, such occupancy shall be a tenancy from month to month upon
all the terms and conditions of this Lease pertaining to the obligations of
Tenant, except that the Base Rent payable shall be one hundred fifty percent
(150%) of the Base Rent payable immediately preceding the termination date of
this Lease, and all Options, if any, shall be deemed terminated and be of no
further effect. If Tenant remains in possession of the Premises or any part
thereof, after the expiration of the term hereof without Landlord's consent,
Tenant shall, at Landlord's option, be treated as a tenant at sufferance or a
trespasser. Nothing contained herein shall be construed to constitute Landlord's
consent to Tenant holding over at the expiration or earlier termination of the
Lease term or to give Tenant the right to hold over after the expiration or
earlier termination of the Lease term. Tenant hereby agrees to indemnify, hold
harmless and defend Landlord from any cost, loss, claim or liability (including
attorneys' fees) Landlord may incur as a result of Tenant's failure to surrender
possession of the Premises to Landlord upon the termination of this Lease.

34.      LANDLORD'S ACCESS.

         34.1     ACCESS. Landlord and Landlord's agents, contractors and
employees shall have the right to enter the Premises at reasonable times for the
purpose of inspecting the Premises, performing any services required of
Landlord, showing the Premises to prospective purchasers, lenders or tenants,
undertaking safety measures and making alterations, repairs, improvements or
additions to the Premises or to the Project in accordance with the applicable
provisions of this Lease. In the event of an emergency (i.e., events endangering
life, limb or property), Landlord may gain access to the Premises by any
reasonable means, and Landlord shall not be liable to Tenant for damage to the
Premises or to Tenant's property resulting from such access so long as Landlord
first attempts, if prudent under the circumstances, to utilize Building keys or
other normal entry methods available to Landlord. Landlord may at any time place
on or about the Building for sale" or "for lease" signs and Landlord may at any
time during the last one hundred twenty (120) days of the term hereof place on
or about the Premises "for lease" signs. If Landlord elects to place "for sale"
signs on the face or roof of the Building, such sign placements shall be subject
to Tenant's written consent (such consent not to be unreasonably withheld).

         34.2     KEYS. Landlord shall have the right to retain keys to the
locks on the entry doors to the Premises and all interior doors at the Premises,
and Landlord shall use commercially reasonable efforts to safeguard such keys
and/or access codes to the doors.

35.      SECURITY MEASURES. Tenant hereby acknowledges that Landlord shall have
no obligation whatsoever to provide guard service or other security measures for
the benefit of the Premises or the Project, and Landlord shall have no liability
to Tenant due to its failure to provide such services. Tenant assumes all
responsibility for the protection of Tenant, its agents,

                                       17
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employees, contractors and invitees, and the property of Tenant and of Tenant's
agents, employees, contractors and invitees from acts of third parties. Nothing
herein contained shall prevent Landlord, at Landlord's sole option, from
implementing security measures for the Project or any part thereof, in which
event Tenant shall participate in such security measures and the cost thereof
shall be included within the definition of Operating Expenses. Landlord shall
have the right, but not the obligation, to require all persons entering or
leaving the Project to identify themselves to a security guard and to reasonably
establish that such person should be permitted access to the Project.

36.      EASEMENTS. Landlord reserves to itself the right, from time to time, to
grant such easements, rights and dedications that Landlord deems necessary or
desirable, and to cause the recordation of parcel maps and restrictions, so long
as such easements, rights, dedications, maps and restrictions do not
unreasonably interfere with the use of the Premises by Tenant. Tenant shall sign
any of the aforementioned documents within ten (10) days after Landlord's
request, and Tenant's failure to do so shall constitute a material default by
Tenant.

37.      TRANSPORTATION MANAGEMENT. Tenant shall fully comply at its sole
expense with all present or future programs required by any governmental or
quasi-governmental entity or Landlord to manage parking, transportation, air
pollution or traffic in and around the Project or the metropolitan area in which
the Project is located.

38.      SEVERABILITY. The invalidity of any provision of this Lease as
determined by a court of competent jurisdiction shall in no way affect the
validity of any other provision hereof.

39.      TIME OF ESSENCE. Time is of the essence with respect to each of the
obligations to be performed by Tenant and Landlord under this Lease.

40.      DEFINITION OF ADDITIONAL RENT. All monetary obligations of Tenant to
Landlord under the terms of this Lease, including, but not limited to, Base
Rent, Tenant's Percentage Share of Operating Expenses and late charges shall be
deemed to be rent.

41.      INCORPORATION OF PRIOR AGREEMENTS. This Lease and the attachments
listed in section 1.15 contain all agreements of the parties with respect to the
lease of the Premises and any other matter mentioned herein. No prior or
contemporaneous agreement or understanding pertaining to any such matter shall
be effective. Except as otherwise stated in this Lease, Tenant hereby
acknowledges that no real estate broker nor Landlord nor any employee or agents
of any of said persons has made any oral or written warranties or
representations to Tenant concerning the condition or use by Tenant of the
Premises or the Project or concerning any other matter addressed by this Lease.

42.      AMENDMENTS. This Lease may be modified in writing only, signed by the
parties in interest at the time of the modification.

43.      NOTICES. All notices required or permitted by this Lease shall be in
writing and may be delivered (a) in person (by hand, by messenger or by courier
service), (b) by U.S. Postal Service regular mall, (c) by U.S. Postal Service
certified mail, return receipt requested, (d) by U.S. Postal Service Express
Mall, Federal Express or other overnight courier, or (e) by facsimile
transmission, and shall be deemed sufficiently given if served in a manner
specified in this section. Any notice permitted or required hereunder, and any
notice to pay rent or quit or similar notice, shall be deemed personally
delivered to Tenant or Landlord, as the case may be, on the date the notice is
personally delivered to any employee of Tenant or Landlord at the addresses for
notice set forth in Section 1.16. The addresses set forth in section 1.16 of
this Lease shall be the address of each party for notice purposes. Landlord or
Tenant may by written notice to the other specify a different address for notice
purposes. A copy of all notices required or permitted to be given to Landlord
hereunder shall be concurrently transmitted to such party or parties at such
addresses as Landlord may from time to time hereinafter designate by written
notice to Tenant. Any notice sent by regular mall or by certified mall, return
receipt requested, shall be deemed given three (3) days after deposited with the
U.S. Postal Service. Notices delivered by U.S. Express Mall, Federal Express or
other courier shall be deemed given on the date delivered by the carrier to the
appropriate party's address for notice purposes. If any notice is transmitted by
facsimile transmission, the notice shall be deemed delivered upon telephone
confirmation of receipt of the transmission thereof at the appropriate party's
address for notice purposes. A copy of all notices delivered to a party by
facsimile transmission shall also be mailed to the party on the date the
facsimile transmission is completed. If notice is received on Saturday, Sunday
or a legal holiday, it shall be deemed received on the next business day.
Nothing contained herein shall be construed to limit Landlord's right to serve
any notice to pay rent or quit or similar notice by any method permitted by
applicable law, and any such notice shall be effective if served in accordance
with any method permitted by applicable law whether or not the requirements of
this section have been met.

44.      WAIVERS. No waiver by Landlord or Tenant of any provision hereof shall
be deemed a waiver of any other provision hereof or of any subsequent breach by
Landlord or Tenant of the same or any other provision. Landlord's consent to, or
approval of, any act shall not be deemed to render unnecessary the obtaining of
Landlord's consent to or approval of any subsequent act by Tenant. The
acceptance of rent hereunder by Landlord shall not be a waiver of any preceding
breach by Tenant of any provision hereof, other than the failure of Tenant to
pay the particular rent so accepted, regardless of Landlord's knowledge of such
preceding breach at the time of acceptance of such rent. No acceptance by
Landlord of partial payment of any sum due from Tenant shall be deemed a waiver
by Landlord of its right to receive the full amount due, nor shall any
endorsement or statement on any check or accompanying letter from Tenant be
deemed an accord and satisfaction.

45.      Intentionally deleted.

46.      BINDING EFFECT; CHOICE OF LAW. Subject to any provision hereof
restricting assignment or subletting by Tenant, this Lease shall bind the
parties, their heirs, personal representatives, successors and assigns. This
Lease shall be governed by the laws of the state in which the Project is
located, and any litigation concerning this Lease between the parties hereto
shall be initiated in the county in which the Project is located.

47.      ATTORNEYS' FEES. If Landlord or Tenant brings an action to enforce the
terms hereof or declare rights hereunder, the prevailing party in any such
action, or appeal thereon, shall be entitled to its reasonable attorneys' fees
and court costs to be paid by the losing party as fixed by the court in the same
or separate suit, and whether or not such action is pursued to decision or
judgment.

48.      AUCTIONS. Tenant shall not conduct, nor permit to be conducted, either
voluntarily or involuntarily, any auction or going-out-of-business sale upon the
Premises or the Common Areas.

49.      MERGER. The voluntary or other surrender of this Lease by Tenant, or a
mutual cancellation thereof, or a termination by Landlord, shall not result in
the merger of Landlord's and Tenant's estates and shall, at the option of
Landlord, terminate all or any existing subtenancies or may, at the option of
Landlord, operate as an assignment to Landlord of any or all of such
subtenancies.

50.      QUIET POSSESSION. Subject to the other terms and conditions of this
Lease, Tenant shall have quiet possession of the Premises for the entire term
hereof subject to all of the provisions of this Lease.

                                       18
<PAGE>

51.      AUTHORITY. If Tenant is a corporation, trust, limited liability
company, limited liability partnership or general or limited partnership,
Tenant, and each individual executing this Lease on behalf of such entity,
represents and warrants that such individual is duly authorized to execute and
deliver this Lease on behalf of said entity, that said entity is duly authorized
to enter into this Lease, and that this Lease is enforceable against said entity
in accordance with its terms.

52.      CONFLICT. Except as otherwise provided herein to the contrary, any
conflict between the printed provisions, exhibits, addenda or riders of this
Lease and the typewritten or handwritten provisions, if any, shall be controlled
by the typewritten or handwritten provisions.

53.      MULTIPLE PARTIES. If more than one person or entity is named as Tenant
herein, the obligations of Tenant shall be the joint and several responsibility
of all persons or entities named herein as Tenant. Service of a notice in
accordance with section 43 on one Tenant shall be deemed service of notice on
all Tenants.

54.      INTERPRETATION. The captions contained in this Lease are for
convenience only and shall not be deemed to limit or alter the meaning of this
Lease. As used in this Lease, the words tenant and landlord include the plural
as well as the singular. Words used in the neuter gender include the masculine
and feminine gender.

55.      PROHIBITION AGAINST RECORDING. Neither this Lease, nor any memorandum,
affidavit or other writing with respect thereto, shall be recorded by Tenant or
by anyone acting through, under or on behalf of Tenant. Landlord shall have the
right to record a memorandum of this Lease, and Tenant shall execute,
acknowledge and deliver to Landlord for recording any memorandum prepared by
Landlord.

56.      RELATIONSHIP OF PARTIES. Nothing contained in this Lease shall be
deemed or construed by the parties hereto or by any third party to create the
relationship of principal and agent, partnership, joint venturer or any
association between Landlord and Tenant.

57.      RULES AND REGULATIONS. Tenant agrees to abide by and conform to the
Rules and to cause its employees, suppliers, customers and invitees to so abide
and conform. Landlord shall have the right, from time to time, to modify, amend
and enforce the Rules in a nondiscriminatory manner. Landlord shall not be
responsible to Tenant for the failure of other persons, including, but not
limited to, other tenants, their agents, employees and invitees, to comply with
the Rules. Tenant acknowledges that the leases of other tenants may not obligate
them to comply with some or all of the Rules. However, if the lease of another
tenant does obligate the tenant to comply with a Rule, and the tenant's failure
to comply with such Rule is having a material adverse effect on Tenant's use of
the Premises, Landlord shall cooperate with Tenant in attempting to cause the
tenant to comply with the Rule, provided, however, Landlord shall have no
obligation to bring a legal action against the non-complying tenant.

58.      RIGHT TO LEASE. Landlord reserves the absolute right to effect such
other tenancies in the Project as Landlord in its sole discretion shall
determine, and Tenant is not relying on any representation that any specific
tenant or number of tenants will occupy the Project.

59.      CONFIDENTIALITY. Tenant acknowledges and agrees that the terms of this
Lease are confidential and constitute proprietary information of Landlord.
Disclosure of the terms hereof could adversely affect the ability of Landlord to
negotiate other leases with respect to the Project and may impair Landlord's
relationship with other tenants of the Project. Tenant agrees that it and its
partners, officers, directors, employees, brokers, lease administrators and
attorneys, if any, shall not disclose the terms and conditions of this Lease to
any other person or entity without the prior written consent of Landlord, which
may be given or withheld by Landlord, in Landlord's reasonable discretion.
Landlord shall also have the right to seek specific performance of this
provision and to seek injunctive relief to prevent its breach or continued
breach.

60.      WAIVER of JURY TRIAL. LANDLORD AND TENANT HEREBY WAIVE THEIR RESPECTIVE
RIGHT TO TRIAL BY JURY OF ANY CAUSE OF ACTION, CLAIM, COUNTERCLAIM OR
CROSS-COMPLAINT IN ANY ACTION, PROCEEDING AND/OR HEARING BROUGHT BY EITHER
LANDLORD AGAINST TENANT OR TENANT AGAINST LANDLORD ON ANY MATTER WHATSOEVER
ARISING OUT OF, OR IN ANY WAY CONNECTED WITH, THIS LEASE, THE RELATIONSHIP OF
LANDLORD AND TENANT, TENANT'S USE OR OCCUPANCY OF THE PREMISES, OR ANY CLAIM OF
INJURY OR DAMAGE, OR THE ENFORCEMENT OF ANY REMEDY UNDER ANY LAW, STATUTE, OR
REGULATION, EMERGENCY OR OTHERWISE, NOW OR HEREAFTER IN EFFECT.

LANDLORD AND TENANT ACKNOWLEDGE THAT THEY HAVE CAREFULLY READ AND REVIEWED THIS
LEASE AND EACH TERM AND PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS
LEASE, SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY
AGREE THAT, AT THE TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE
COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LANDLORD AND
TENANT WITH RESPECT TO THE PREMISES. TENANT ACKNOWLEDGES THAT IT HAS BEEN GIVEN
THE OPPORTUNITY TO HAVE THIS LEASE REVIEWED BY ITS LEGAL COUNSEL PRIOR TO ITS
EXECUTION. PREPARATION OF THIS LEASE BY LANDLORD OR LANDLORD'S AGENT AND
SUBMISSION OF SAME TO TENANT SHALL NOT BE DEEMED AN OFFER BY LANDLORD TO LEASE
THE PREMISES TO TENANT OR THE GRANT OF AN OPTION TO TENANT TO LEASE THE
PREMISES. THIS LEASE SHALL BECOME BINDING UPON LANDLORD ONLY WHEN FULLY EXECUTED
BY BOTH PARTIES AND WHEN LANDLORD HAS DELIVERED A FULLY EXECUTED ORIGINAL OF
THIS LEASE TO TENANT.

LANDLORD:

The Realty Associates Fund III, L.P., a Delaware limited partnership

By:      Realty Associates Fund III GP Limited Partnership, a Delaware limited
            partnership, its general partner

         By:      Realty Associates Fund III LLC, a Delaware limited liability
                     company, its sole general partner

                  By:      Realty Associates Fund III trust, a Massachusetts
                           business trust, sole Member

                           By: /s/  Scott W. Amling
                               -------------------------------------------------
                               (Officer)

                                   Scott W. Amling
                                   Regional Director

By:      Realty Associates Fund III Texas Corporation,
         a Texas corporation, general partner

                                       19
<PAGE>

              By: /s/  Scott W. Amling
                  ---------------------------
                       (Officer)

                                Scott W. Amling
                                Regional Director

*TENANT:

Celerity Group, Inc., a California corporation

By:  /s/ JOHN GOODMAN
     -----------------------------------

         JOHN GOODMAN
     -----------------------------------
         (print name)

Its: EXECUTIVE VICE PRESIDENT
     -----------------------------------
         (print title)

By:  /s/ JOHN R.FERRON
     -----------------------------------

         JOHN R.FERRON
     -----------------------------------
         (print name)

Its:        CFO
     -----------------------------------
         (print title)

*If Tenant is a corporation, the authorized officers must sign on behalf of the
corporation and indicate the capacity in which they are signing. The Lease must
be executed by the president or vice president and the secretary or assistant
secretary, unless the bylaws or a resolution of the board of directors shall
otherwise provide, in which event, the bylaws or a certified copy of the
resolution, as the case may be, must be attached to this Lease.

                                       20
<PAGE>

                                  EXHIBIT "A"

                                  [FLOOR PLAN]

<PAGE>
                                    EXHIBIT B

Intentionally deleted

<PAGE>

                                    EXHIBIT C

                              RULES AND REGULATIONS

                                 GENERAL RULES

Tenant shall faithfully observe and comply with the following Rules and
Regulations:

1.       Tenant shall not alter any locks or install any new or additional locks
or bolts on any doors or windows of the Premises without providing notification
and keys to Landlord. Tenant shall bear the cost of any lock changes or repairs
required by Tenant.

2.       Access to the Project may be refused unless the person seeking access
has proper identification or has a previously received authorization for access
to the Project. Landlord and its agents shall in no case be liable for damages
for any error with regarding to the admission to or exclusion from the Project
of any person. In case of invasion, mob, riot, public excitement or other
commotion, Landlord reserves the right to prevent access to the Project during
the continuance thereof by any means it deems appropriate for the safety and
protection of life and property.

3.       No cooking shall be done or permitted on the Premises, nor shall the
Premises be used for any improper, objectionable or immoral purposes.
Notwithstanding the foregoing, Underwriters' Laboratory-approved equipment and
microwave ovens may be used in the Premises for heating food and brewing coffee,
tea, hot chocolate and similar beverages for employees and visitors of Tenant,
provided that such use is in accordance with all applicable federal, state and
city laws, codes, ordinances, rules and regulations; and provided further that
such cooking does not result in odors escaping from the Premises.

4.       Except as provided in section 13.1, no boring or cutting for wires
shall be allowed without the consent of Landlord. Tenant shall not install any
radio or television antenna, satellite dish, loudspeaker or other device on the
roof or exterior walls of the Building. Tenant shall not interfere with
broadcasting or reception from or in the Project or elsewhere.

5.       Landlord reserves the right to exclude or expel from the Project any
person who, in the judgment of Landlord, is intoxicated or under the influence
of liquor or drugs, or who shall in any manner do any act in violation of any of
these Rules and Regulations.

6.       Tenant shall store all its trash and garbage within the interior of the
Premises or, if permitted by applicable law, in trash dumpsters in locations
approved by Landlord for such use, in Landlord's reasonable discretion. No
material shall be placed in the trash boxes or receptacles if such material is
of such nature that it may not be disposed of in the ordinary and customary
manner of removing and disposing of trash in the vicinity of the Project without
violation of any law or ordinance governing such disposal.

7.       Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.

                                  PARKING RULES

1.       Tenant shall not permit or allow any vehicles that belong to or are
controlled by Tenant or Tenant's employees, suppliers, shippers, customers or
invitees to be loaded, unloaded or parked in areas other than those designated
by Landlord for such activities and at times approved by Landlord. Users of the
parking area will obey all posted signs and park only in the areas designated
for vehicle parking. Tenant and its customers, employees, shippers and invitees
shall comply with all rules and regulations adopted by Landlord from time to
time relating to truck parking and/or truck loading and unloading.

2.       Landlord reserves the right to relocate all or a part of parking spaces
within the parking area so long as the number of such spaces and proximity to
the Building are substantially the same as existed as of the Commencement Data.

3.       Landlord will not be responsible for any damage to vehicles, injury to
persons or loss of property, all of which risks are assumed by the party using
the parking area.

4.       The maintenance, washing, waxing or cleaning of vehicles in the parking
area or Common Areas is prohibited.

5.       Tenant shall be responsible for seeing that all of its employees,
agents, contractors and invitees comply with the applicable parking rules,
regulations, laws and agreements.

6.       At Landlord's request, Tenant shall provide Landlord with a list which
includes the name of each person using the parking facilities based on Tenant's
parking rights under this Lease and the license plate number of the vehicle
being used by that person. Tenant shall provide Landlord with an updated list
within five (5) days after any part of the list becomes inaccurate. Celerity
Group, Inc. and its Affiliates shall not be obligated to comply with the
requirements of this section 6.

Landlord reserves the right at any time to change or rescind any one or more of
these Rules and Regulations, or to make such other and further reasonable Rules
and Regulations as in Landlord's judgment may from time to time be necessary for
the management, safety, care and cleanliness of the Project, and for the
preservation of good order therein, as well as for the convenience of other
occupants and tenants therein. Any of the foregoing which materially and
adversely interfere with Tenant's business operations (as they exist on the
Commencement Date) shall require Tenant's prior written consent (such consent
not to be unreasonably withheld). Landlord may waive any one or more of these
Rules and Regulations for the benefit of any particular tenant, but no such
waiver by Landlord shall be construed as a waiver of such Rules and Regulations
in favor of any other tenant, nor prevent Landlord from thereafter enforcing any
such Rules or Regulations against any or all tenants of the Project. Tenant
shall be deemed to have read these Rules and Regulations and to have agreed to
abide by them as a condition of its occupancy of the Premises.

<PAGE>

                                    EXHIBIT D

                           Form of HazMat Certificate
                    Re: 1463 Centre Point Drive, Milpitas, CA

                               General Information

Name of Responding Company: Celerity Group Inc. (formerly Kinetics Fluid
Systems, Inc.)

Mailing Address: 1463 Centre Pointe Drive, Milpitas, CA 95035

Signature:______________________________________________________________________

Title:__________________________________ Phone: 408-946-3100

Date: 6/19/03  Age of Facility:_________ Length of Occupancy:___________________

Major products manufactured and/or activities conducted on the property: Gas
Flow Controls, MFC's, Gas Panels
________________________________________________________________________________
________________________________________

<TABLE>
<CAPTION>
   Type of Business Activity(ies):                Hazardous Materials Activities:
---------------------------------------         -----------------------------------
(check all that apply)                          (check all that apply)
<S>                                             <C>
X       machine shop                             _______ degreasing
X       light assembly                           _______ chemical/etching/milling
X       research and development                 _______ wastewater treatment
X       product service or repair                _______ painting
_______ photo processing                         _______ striping
_______ automotive service and repair            _______ cleaning
_______ manufacturing                            _______ printing
_______ warehouse                                _______ analytical lab
_______ integrated/printed circuit               _______ plating
_______ chemical/pharmaceutical product          _______ chemical/missing/synthesis
                                                 _______ silkscreen
                                                 X       lathe/mill machining
                                                 _______ deionizer water product
                                                 _______ photo masking
                                                 _______ wave solder
                                                 _______ metal finishing
</TABLE>

                 HAZARDOUS MATERIALS/WASTE HANDLING AND STORAGE

A.       Are hazardous materials handled on any of your shipping and receiving
docks in container quantities greater than one gallon? ______ Yes X  No

B.       If Hazardous materials or waste are stored on the premises, please
check off the nature of the storage and type(s) of materials below:

<TABLE>
<CAPTION>
      Types of Storage Container                Type of Hazardous Materials and/or Waste Stored
-----------------------------------------       -----------------------------------------------
(list above-ground storage only)
<S>                                             <C>
X        1 gallon or 3 liter bottles/cans       ________ acid
________ 5 to 30 gallon carboys                 ________ phenol
________ 55 gallon drums                        X        caustic/alkaline cleaner
________ tanks                                  ________ cyanide
                                                ________ photo resist stripper
                                                ________ paint
                                                X        flammable solvent
                                                ________ gasoline/diesel fuel
                                                ________ nonflammable/chlorinated solvent
                                                X        oil/cutting fluid
</TABLE>

C.       Do you accumulate hazardous waste onsite? X Yes ______ No

         If yes, how is it being handled?

         ________ on-site treatment or recovery
         ________ discharaged to sewer
         X        hauled offsite        If hauled offsite, by whom Onyx, 4227
                                        Technology Drive, Fremont, CA 94538
         ________ incineration

D.       Indicate your hazardous waste storage status with Department of Health
Services:

         ________ generator
         ________ interim status facility
         ________ permitted TSDF
         X        none of the above

                         WASTEWATER TREATMENT/DISCHARGE

<PAGE>

A.       Do you discharge industrial wastewater to:

         ______ sewer
         ______ storm drain
         ______ surface water
         X      no industrial discharge

B.       Is your industrial wastewater treated before discharge?
         ____ Yes ____ No

         If yes, what type of treatment is being conducted?

         ______ neutralization
         ______ metal hydroxide formation
         ______ closed-loop treatment
         ______ cyanide destruct
         ______ HF treatment
         ______ other

              SUBSURFACE CONTAINMENT OF HAZARDOUS MATERIALS/WASTES

A.       Are buried tanks/sumps being used for any of the following:

         ______ hazardous waste storage
         ______ chemical storage
         ______ gasoline/diesel fuel storage
         ______ waste treatment
         ______ wastewater neutralization
         ______ industrial wastewater treatment
         X      none of the above

B.       If buried tanks are located onsite, indicate their construction:

        _______ steel _______ fiberglass _________ concrete
        _______ inside open vault ________double walled

C.       Are hazardous materials or untreated industrial wastewater transported
via buried piping to tanks, process areas or treatment areas? ______ Yes X  No

D.       Do you have wet floors in your process areas? ______ Yes X No

         If yes, name processes:________________________________________________

E.       Are abandoned underground tanks or sumps located on the property? _____
         Yes X No

                           HAZARDOUS MATERIALS SPILLS

A.       Have hazardous materials ever spilled to:

         _______ the sewer
         _______ the storm drain
         _______ onto the property
         X       no spills have occurred

B.       Have you experienced any leaking underground tanks or sumps?
         _______ Yes X No

C.       If spills have occurred, were they reported? _______ Yes  ______ No

         Check which the government agencies that you contacted regarding the
         spill(s):

         _______ Department of Health Services
         _______ Department of Fish and Game
         _______ Environmental Protection Agency
         _______ Regional Water Quality Control Board
         _______ Fire Department

<PAGE>

D.       Have you been contacted by a government agency regarding soil or
         groundwater contamination on your site? ______ Yes X No

         Do you have exploratory wells onsite? _______ Yes X No

         If yes, indicate the following:

         Number of wells: __________ Approximate depth of wells: __________

         Well diameters: ___________

PLEASE ATTACH ENVIRONMENTAL REGULATORY PERMITS, AGENCY REPORTS THAT APPLY TO
YOUR OPERATION AND HAZARDOUS WASTE MANIFESTS.

Check off those enclosed:

X       Hazardous Materials Inventory Statement, HMIS
X       Hazardous Materials Management Plan, HMMP
_______ Department of Health Services, Generatory Inspection Report
_______ Underground Tank Registrations
_______ Industrial Wastewater Discharge Permit
X       Hazardous Waste Manifest
<PAGE>

              HAZARDOUS MATERIALS BUSINESS PLAN INFORMATION SHEET
 For use by Unidocs Member Agencies or where approved by your Local Jurisdiction
  Authority Cited: Ch. 6.95 HSC; Title 19, Div. 2, CCR; Title 22, Div. 4.5, CCR

All facilities in Unidocs member jurisdictions that use or store hazardous
materials (defined as either virgin or waste materials) in any quantity are
required to report such use or storage to the appropriate local agency. The
amount of detail required to be reported depends on whether or not a facility is
subject to state Hazardous Materials Business Plan (HMBP) reporting
requirements. Facilities subject to HMBP reporting requirements must complete
and submit to their local agency a HMBP. All other facilities handling hazardous
materials, unless specifically exempted by their local agency, must complete and
submit a Hazardous Materials/Waste Registration Form.

The attached MATRIX INVENTORY FORMAT HAZARDOUS MATERIALS BUSINESS PLAN is the
preferred format for HMBP reporting. [This form was developed by the Certified
Unified Program Agency (CUPA) as an alternative version of the Unified Program
Consolidated Form (UPCF). Businesses have the option to use it or the UPCF
adopted in state regulations. The CUPA or Participating Agency (PA) must accept
the state UPCF and cannot require a business to use the alternative version
developed by the CUPA. The CUPA and PA can require businesses to provide
additional information on either the UPCF or a supplemental page to that
document.] A HMBP including the standard UPCF One-Chemical-Per-Page Inventory
Format is available at www.unidocs.org. If you wish to use forms other than
those included in this document, or the Unidocs standard UPCF Hazardous Material
Business Plan, please contact your local implementing agency for guidance.
Depending upon the nature of storage/handling of hazardous materials at the
facility, additional information may be required to be submitted as Appendices
to the HMBP. Examples of such Appendices could include:

         -        For underground storage tanks (UST), Unified Program
                  Consolidated Forms (UPCF) UST - Facility and UST - Tank pages;

         -        California Accidental Release Prevention (CalARP) Program
                  Registration Form;

         -        Toxic Gas Registration Form;

         -        UPCF Onsite Hazardous Waste Treatment Forms;

         -        Storm Water Pollution Prevention Plan; etc.

WHAT IS A HAZARDOUS MATERIALS BUSINESS PLAN?

A HMBP is a document containing detailed information on the storage of hazardous
materials at a facility. Chapter 6.95 of the California Health and Safety Code
(HSC) requires that facilities which use or store such materials at or above
reporting thresholds (see below) submit this information.

WHAT IS THE PURPOSE OF THE HAZARDOUS MATERIALS BUSINESS PLAN?

The intent of the Business Plan is to satisfy federal and state Community
Right-To-Know laws and provide detailed information for use by emergency
responders. All persons at the facility qualified to serve as emergency
coordinators must be thoroughly familiar with the contents and use of the HMBP,
with the operations and activities of the facility, and with the locations of
all hazardous materials records maintained by the facility.

This Hazardous Materials Business Plan has been developed to assist you in
complying with the State requirements and to provide the fire department
adequate information about the type, quantity of -- and management practices
regarding -- hazardous materials that are stored at your facility. Along with
applicable modules and appendices, it is intended to additionally satisfy some
or all of me reporting requirements for the following programs: Hazardous
Materials Storage; CalARP Program Registration; Toxic Gas Ordinance; Hazardous
Waste Generator Registration; Hazardous Waste Contingency Plan; Urban Runoff;
and aboveground storage tank Spill Prevention Control and Countermeasure Plan.

WHO MUST COMPLETE A HAZARDOUS MATERIALS BUSINESS PLAN?

The owner of a facility must complete a HMBP and submit a copy to the local
agency for each site that handles any individual hazardous material or mixture
containing a hazardous material which has a quantity at any time during the
reporting year equal to or greater than:

1.       500 Pounds For SOLID HAZARDOUS MATERIALS. [HSC Section 25503.5(A)]

2.       The Following Amounts For LIQUID HAZARDOUS MATERIALS:

         a.       Lubricating oil as defined by HSC Section 25503.5(b)(2)(B): 55
                  gallons of any type or 275 gallons aggregate quantity on
                  site. HSC Section 25503.5(b)(2)(A)]

         b.       All others, including waste oil: 55 gallons. [HSC Section
                  25503.5(a)]

3.       The Following Amounts Of HAZARDOUS MATERIAL GASES:

         a.       Oxygen, Nitrogen, or Nitrous Oxide stored/handled at a
                  physician, dentist, podiatrist, veterinarian, or pharmacist's
                  place of business: 1,000 cubic feet of each material on site.
                  [HSC Section 25503.5(b)(1)

         b.       All others: 200 cubic feet. [HSC Section 25503.5(a)]

4.       Amounts of RADIOACTIVE MATERIALS requiring an emergency plan under
         Parts 30,40, or 70 of Title 10 Code of Federal Regulations or equal to
         or greater than applicable amounts specified in items 1,2, or 3, above,
         whichever amount is smaller. [HSC Section 25503.5(a)]

5.       Applicable federal threshold planning quantities for EXTREMELY
         HAZARDOUS SUBSTANCE: listed in 40 CFR Part 355, Appendix A.

<PAGE>

HAZARDOUS MATERIALS BUSINESS PLAN INFORMATION SHEET (CONTINUED)

Note: Retail (Consumer) Products packaged for direct distribution to, and use
by, the general public are exempt from HMBP requirements except where the local
agency determines otherwise pursuant to HSC Section 25503.5(c)(l). [Local agency
interpretation is that materials qualify for this exemption only if the
following requirements are met: (1) The product is not dispensed from containers
at the storage facility; (2) The product is stored in a "retail display area "
as defined by the 1994 California Fire Code (e.g. Quarts of oil sitting in a
display area for sale at a service station are exempt, but oil used by a
mechanic in the service bay is not exempt); (3) containers are no larger than 5
gallons (liquids) or 100 pounds (solids); and (4) Handling of the product does
not present unacceptable risk to public health, safety, or the environment.]

WHAT IF I DON'T HANDLE ANY HAZARDOUS MATERIALS IN AMOUNTS REQUIRING A HMBP?

Facilities that are not required to complete a HMBP are still required to
register their hazardous materials with the local agency using the Hazardous
Materials/Waste Registration Form. The local agency will then evaluate the
storage or use and notify you of any permits or storage/use fees that may apply.
(NOTE: THE LOCAL AGENCIES RESERVE THE RIGHT TO REQUIRE A HMBP FOR ANY FACILITY
UPON DETERMINATION THAT THE MANNER OF USE OR STORAGE OF hAZARDOUS MATERIALS IS
SUCH THAT ADDITIONAL iNFORMATION iS NECESSARY FOR EMERGENCY RESPONSE PURPOSES.)

WHAT INFORMATION IS REQUIRED TO BE SUBMITTED WITH THE HAZARDOUS MATERIALS
BUSINESS PLAN?

The HMBP must contain the following elements:

         -        Business Activities (Form and instructions attached)

         -        Business Owner/Operator identification (Form and instructions
                  attached)

         -        Hazardous Materials inventory (Forms and instructions
                  attached)

         -        Facility Map(s) (Sample form and Instructions attached)

         -        Emergency Response/Contingency Plan (Sample forms and
                  instructions attached)

         -        Employee Training Plan (Sample form and instructions attached)

         -        Recordkeeping (Sample form and instructions attached)

HOW OFTEN DO I HAVE TO UPDATE OR RECERTIFY MY HAZARDOUS MATERIALS BUSINESS PLAN?

Within 30 days of the occurrence of any of the following events, the HMBP shall
be revised and the revisions submitted to the local agency: (1) There is a 100%
or more increase in the quantity of a previously disclosed material; (2) The
facility begins handling a previously undisclosed material at or above the
aforementioned HMBP amounts; (3) The facility changes address; (4) Ownership of
the facility changes; or (5) There is a change of business name. [HSC Section
25510]

Additionally, if the local agency determines that the HMBP is deficient in any
way, the plan shall be revised and the revisions submitted to the local agency
within 30 days of the notice to submit a corrected plan. [HSC Section
25505(a)(2)]

Without regard to the above events, the owner, operator, or officially
designated representative of the facility must complete and submit to the local
agency a Hazardous Materials Business Plan Certification Form [or a copy of your
current HMBP with an updated certification signature and date at the bottom of
OES Form 2730, the Business Owner/Operator Identification form (i.e. page 5 of
this packet)] annually. (HSC Section 25503.3(c)] Hazardous Materials Business
Plan Certification Forms are available from your local agency or on the Internet
at www.unidocs.org.

WHO IS MY LOCAL AGENCY?

Refer to the table below. Jurisdiction is determined by whether the facility is
located within city limits or in an unincorporated area.

<TABLE>
<CAPTION>
             CITY/AREA                          LOCAL AGENCY NAME                  ADDRESS                  TELEPHONE NUMBER
-----------------------------------------------------------------------------------------------------------------------------
<S>                               <C>                                      <C>                              <C>
Campbell                          Santa Clara County Fire Department       14700 Winchester                    (408) 378-4010
                                                                           Boulevard Los Gatos, CA
                                                                           95030-1818

Cupertino                         See Campbell

Gilroy                            Gilroy Building Department Life and      7351 Rosanna                        (408) 846-0430
                                  Environmental Safety Division            Street Gilroy,CA 95020

Los Altos                         County of Santa Clara Department of      1555 Berger Drive, Suite         (408) 299-6930 or
                                  Environmental Health Hazardous           300 San Jose, CA                     (408)918-3400
                                  Materials Compliance Division            95112-2716 www.EHinfo.org
Lon Altos Hills                   See Los Altos
Los Gatos                         See Campbell

Milpitas                          Milpitas Fire Department                 455 East Calaveras                  (408) 586-3365
                                  Bureau of Fire                           Boulevard Mipitas,CA 95035
                                  Prevention
Monte Sereno                      See Lao Altos
Morgan Hill                       See Campbell

Mountain View                     Mountain View Fire Department Fire and   1000 Villa Street                    (650)903-6378
                                  Environmental Protection Division        Mountain View, CA 94041

Palo Alto                         Palo Alto Fire Department                250 Hamilton Avenue                  (650)329-2184
                                  Hazardous Materials                      Palo Alto, CA 94301
                                  Division
San Jose                          San Jose Fire Department                 4 North Second Street,               (408)277-4659
                                  Hazardous Materials Program              #1100 San Jose, CA
                                                                           95113-1305

Santa Clara                        Santa Clara Fire Department               1675 Lincoln Street                 (408)615-4960
                                                                           Santa Clara, CA 95050
Saratoga                          See Los Altos

Sunnyvale                         Sunnyvale Department of Public           700 All America Way P.O.             (408)730-7212
                                  Safety Fire Prevention Bureau            Box 3707 Sunnyvale, CA
                                                                           94088-3707

Unincorporated Santa Clara County  See LosAltos
</TABLE>

<PAGE>
================================================================================
                        UNIFIED PROGRAM CONSOLIDATED FORM
                              FACILITY INFORMATION
                               BUSINESS ACTIVITIES
================================================================================
                                                                     Page 1 of__
--------------------------------------------------------------------------------
                           I. FACILITY IDENTIFICATION
--------------------------------------------------------------------------------
FACILITY ID #      4 3 0 1 1 9 5 0 2 6 0  1. EPA ID # (Hazardous Waste Only)  2.
                                                       CAL-000221338
(Agency Use Only)
--------------------------------------------------------------------------------
BUSINESS NAME (Same as Facility Name or DBA - Doing Business As)              3.
--------------------------------------------------------------------------------
Kinetics Fluid Systems
--------------------------------------------------------------------------------
                           II. ACTIVITIES DECLARATION
--------------------------------------------------------------------------------
                NOTE: IF YOU CHECK YES TO ANY PART OF THIS LIST,
 PLEASE SUBMIT THE BUSINESS OWNER/OPERATOR IDENTIFICATION PAGE (OES FORM 2730).
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                Does your facility...                                           If Yes, please complete these pages of the UPCF...
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                        <C>                 <C>
A. HAZARDOUS MATERIALS

Have on site (for any purpose) hazardous                   [X] YES [ ] NO 4.   HAZARDOUS MATERIALS INVENTORY - CHEMICAL DESCRIPTION
materials at or above 55 gallons for                                           (OES 2731)
liquids, 500 pounds for solids, or 200
cubic feet for compressed gases (include
liquids in ASTs and USTs); or the
applicable Federal threshold quantity
for an extremely hazardous substance
specified in 40 CFR Fart 355, Appendix A
or B; or handle radiological materials
in quantities for which an emergency
plan is required pursuant to 10 CFR
Parts 30, 40 or 70?
------------------------------------------------------------------------------------------------------------------------------------
B. UNDERGROUND STORAGE TANKS USTs)                                             UST FACILITY (Formerly SWRCB Form A)

1.       Own or operate underground storage tanks?         [ ] YES [X] NO 5.   UST TANK (one page per tank) (Formerly Form B)

2.       Intend to upgrade existing or install new USTs?   [ ] YES [X] NO 6.   UST FACILITY

                                                                               UST TANK (one per tank)
                                                                               UST INSTALLATION - CERTIFICATE OF COMPLIANCE (one
                                                                               page per tank) (Formerly  Form C)

3.       Need to report closing a UST?                     [ ] YES [X] NO 7.   UST TANK (closure portion - one page per tank)
------------------------------------------------------------------------------------------------------------------------------------
C. ABOVE GROUND PETROLEUM STORAGE TANKS (ASTs)

      Own or operate ASTs above these thresholds:                              NO FORM REQUIRED TO CUPAs

      -- any tank capacity is greater than 660 gallons, or [ ] YES [X] NO 8.
      -- the total capacity for the facility is greater
         than 1,320 gallons?
------------------------------------------------------------------------------------------------------------------------------------
D. HAZARDOUS WASTE

1.       Generate hazardous waste?                                             EPA ID NUMBER - provide at the top of this page
                                                           [ ] YES [X] NO 9.
2.       Recycle more than 100 kg/month of excluded                            RECYCLABLE MATERIALS REPORT (one per recycler)
         or exempted recyclable materials (per HSC
         Section 25143.2)?
                                                           [ ] YES [X] NO 10.
3.       Treat hazardous waste on site?                                        ONSITE HAZARDOUS WASTE
                                                           [ ] YES [X] NO 11.  TREATMENT - FACILITY (Formerly DTSC Forms 1772)
                                                                               ONSITE HAZARDOUS WASTE
                                                                               TREATMENT - UNIT (one page per unit) (Formerly DTSC
                                                                               Forms 1772 A,B,C,D and L)

4.       Treatment subject to financial assurance                              CERTIFICATION OF FINANCIAL
         requirements (for Permit by Rule and              [ ] YES [X] NO 12.  ASSURANCE (Formerly DTSC Form 1232)
         Conditional Authorization)?

5.       Consolidate hazardous waste generated at a                            REMOTE WASTE / CONSOLIDATION SITE ANNUAL NOTIFICATION
         remote site?                                      [ ] YES [X] NO 13.  (Formerly DTSC Form 1196)
                                                                               HAZARDOUS WASTE TANK CLOSURE

6.       Need to report the closure/removal of a tank      [ ] YES [X] NO 14.  CERTIFICATION (Formerly DTSC Form 1249)
         that was classified as hazardous waste and
         cleaned onsite?
------------------------------------------------------------------------------------------------------------------------------------
E. LOCAL REQUIREMENTS
</TABLE>

           (You may also be required to provide additional information       15.
                         by your CUPA or local agency.)

<PAGE>

                      BUSINESS ACTIVITIES PAGE INSTRUCTIONS

You must submit the Business Activities page with all submittals. [Note:
Numbering of these instructions follows the Unified Program Consolidated Form
(UPCF) data element numbers on the Business Activities page. These data element
numbers are used for electronic submittal and are the same as the numbering used
in 27 CCR, Appendix C, the Unified Program Data Dictionary.] Please number all
pages of your submittal.

1.       FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

2.       EPA ID NUMBER - If you generate, recycle, or treat hazardous waste,
                  enter your facility's 12-character U.S. Environmental
                  Protection Agency (U.S. EPA) or California Identification
                  number. For facilities in California, the number usually
                  starts with the letters "CA." If you do not have an ID number,
                  contact the Department of Toxic Substances Control (DTSC) at
                  1-800-618-6942 to obtain one.

3.       BUSINESS NAME - Enter the complete Facility Name.

4.       HAZARDOUS MATERIALS ONSITE - Check the appropriate box to indicate
                  whether you have any hazardous material on site in a quantity
                  subject to Hazardous Materials Business Plan reporting
                  requirements (please refer to the above Hazardous Materials
                  Business Plan Information Sheet).

5.       OWN OR OPERATE UNDERGROUND STORAGE TANK (UST) - Check the appropriate
                  box to indicate whether you own or operate USTs containing
                  hazardous substances as defined in Health and Safety Code
                  (HSC) Section 25316. If "YES", and you do not already have on
                  file with your local agency a UST Facility page, UST Tank page
                  for each tank, written UST Monitoring Plan, and UST Response
                  Plan, then you must submit those documents. (There are no UPCF
                  pages for the monitoring and response plans.)

6.       UST INSTALLATION/UPGRADE - Check the appropriate box to indicate
                  whether you have installed or upgraded USTs containing
                  hazardous substances as defined in HSC Section 25316. If
                  "YES," then you must submit to your local agency a UST
                  Installation - Certificate of Compliance page for each tank in
                  addition to the UST Facility and Tank pages.

7.       UST CLOSURE - Check the appropriate box if you are closing a UST and
                  complete the closure portion of the UST Tank page for each
                  tank.

8.       OWN/OPERATE ABOVEGROUND PETROLEUM STORAGE TANK (AST) - Check the
                  appropriate box to indicate whether your facility stores
                  petroleum aboveground in any tank greater than 660 gallons
                  capacity or has aggregate aboveground petroleum storage
                  greater than 1,320 gallons. (There is no UPCF page for ASTs.)
                  The following are exempt from this requirement:

                  -        Pressure vessels or boilers subject to Division 5 of
                           the Labor Code;

                  -        Tanks containing hazardous waste if a hazardous waste
                           facility permit has been issued by DTSC;

                  -        Aboveground oil production tanks regulated by the
                           Division of Oil and Gas;

                  -        Certain oil-filled electrical equipment, including,
                           but not limited to, transformers, circuit breakers,
                           and capacitors.

9.       HAZARDOUS WASTE GENERATOR - Check the appropriate box to indicate
                  whether your facility generates a waste that meets any of the
                  hazardous waste criteria adopted pursuant to HSC Section
                  25141.

10.      RECYCLE - Check the appropriate box to indicate whether your facility
                  recycles more than 100 kilograms (approximately 220 pounds or
                  27 gallons) per month of recyclable material under a claim
                  that the material is excluded or exempt per HSC Section
                  25143.2. If you check "YES," and you do not already have a
                  current Recyclable Materials Report on file with your
                  Certified Unified Program Agency (CUPA), then you must also
                  submit that report to the CUPA. Check "NO" if you only send
                  recyclable materials to an offsite recycler.

11.      ONSITE HAZARDOUS WASTE TREATMENT - Check the appropriate box to
                  indicate whether your facility engages in regulated onsite
                  treatment of hazardous waste. If you check "YES," and you do
                  not already have current Onsite Hazardous Waste Treatment
                  Notification - Facility and Onsite Hazardous Waste Treatment
                  Notification - Unit documents on file with your CUPA, then you
                  must submit those forms to the CUPA.

12.      FINANCIAL ASSURANCE - Check the appropriate box to indicate whether
                  your facility has Permit by Rule (PBR) and/or Conditionally
                  Authorized (CA) operations subject to financial assurance
                  requirements for closure of an onsite treatment unit. If you
                  check "YES," and you do not already have current
                  "Certification of Financial Assurance" on file with your CUPA,
                  then you must submit that form to the CUPA.

13.      HAZARDOUS WASTE REMOTE CONSOLIDATION SITE - Check the appropriate box
                  to indicate whether your facility consolidates hazardous waste
                  generated at a remote site. By answering "YES," you are
                  indicating that you are a hazardous waste generator that
                  collects hazardous waste initially at remote sites and
                  subsequently transports the hazardous waste to a consolidation
                  site you also operate. If you check "YES," and you do not
                  already have current "Remote Waste Consolidation Site Annual
                  Notification" page on file with your CUPA, then you must
                  submit that form to the CUPA.

14.      HAZARDOUS WASTE TANK CLEANING - Check the appropriate box if any tank
                  has been cleaned onsite per Title 22, Div. 4.5, Ch. 32, CCR.
                  If you check "YES," then you must submit a Hazardous Waste
                  Tank Closure Certification to your local agency.

15.      LOCAL REQUIREMENTS - Check with your local agency before submitting
                  this document to determine if any supplemental information is
                  required.

<PAGE>

================================================================================
                        UNIFIED PROGRAM CONSOLIDATED FORM
                              FACILITY INFORMATION
                      BUSINESS OWNER/OPERATOR IDENTIFICATION
================================================================================
                                                                   Page___ of___
--------------------------------------------------------------------------------
                                I. IDENTIFICATION
--------------------------------------------------------------------------------
FACILITY ID #  4 3 0 11 9 5 0 2 6 0 1.  BEGINNING DATE 100.    ENDING DATE  101.
(Agency Use Only)                       2/18/2002              2/18/2003
--------------------------------------------------------------------------------
BUSINESS NAME (Same as FACILITY NAME or DBA -           3. BUSINESS PHONE   102.
DOING BUSINESS AS)                                         408-946-3100
Kinetics Fluid Systems
--------------------------------------------------------------------------------
BUSINESS SITE ADDRESS                                                       103.
1463 Centre Pointe Drive
--------------------------------------------------------------------------------
CITY                                    104.      ZIP CODE                  105.
Milpitas                                     CA   95035
--------------------------------------------------------------------------------
DUN & BRADSTREET                             106. SIC CODE (4 digit#)       107.
60-796-0507                                       3823
--------------------------------------------------------------------------------
COUNTY                                                                      108.
Santa Clara
--------------------------------------------------------------------------------
BUSINESS OPERATOR NAME                       109. BUSINESS OPERATOR PHONE   110.
Kinetics Fluid Systems                            408-946-3100
--------------------------------------------------------------------------------
                                II. BUSINESS OWNER
--------------------------------------------------------------------------------
OWNER NAME                                   111. OWNER PHONE               112.
Kinetics Fluid Systems                            408-946-3100
--------------------------------------------------------------------------------
OWNER MAILING ADDRESS                                                       113.
1463 Center Pointe Drive
--------------------------------------------------------------------------------
CITY                                    114. STATE    115. ZIP CODE         116.
Milpitas                                     CA            95035
--------------------------------------------------------------------------------
                           III. ENVIRONMENTAL CONTACT
--------------------------------------------------------------------------------
CONTACT NAME                                 117. CONTACT PHONE             118.
Rick Regnier                                      503-351-0182
--------------------------------------------------------------------------------
CONTACT MAILING ADDRESS                                                     119.
9660 SW Herman Rd
--------------------------------------------------------------------------------
CITY                                    120. STATE    121. ZIP CODE         122.
Tualatin                                     OR            97062
--------------------------------------------------------------------------------
     -PRIMARY-              IV. EMERGENCY CONTACTS              -SECONDARY-
--------------------------------------------------------------------------------
NAME                               123. NAME                                128.
Jeff Kircher                            Rick Regnier
--------------------------------------------------------------------------------
TITLE                              124. TITLE                               129.
Facilities Manager                      Corporate Safety Director
--------------------------------------------------------------------------------
BUSINESS PHONE                     125. BUSINESS PHONE                      130.
408-935-4507                            503-783-2043
--------------------------------------------------------------------------------
24-HOUR PHONE*                     126. 24-HOUR PHONE*                      131.
510-656-4204                            503-351-0182
--------------------------------------------------------------------------------
PAGER #                            127. PAGER #                             132.
510-770-7513                            N/A
--------------------------------------------------------------------------------

ADDITIONAL LOCALLY COLLECTED INFORMATION:                                   133.

Property Owner: Insignia Commercial Group, Inc.          Phone No.: 408-288-2900

Billing Address: 160 W. Santa Clara Street, San Jose, CA 95113

Certification: Based on my inquiry of those individuals responsible for
obtaining the information, I certify under penalty of law that I have personally
examined and am familiar with the information submitted and believe the
Information is true, accurate, and complete.

SIGNATURE OF OWNER/OPERATOR OR     DATE   134.  NAME OF DOCUMENT PREPARER   135.
DESIGNATED REPRESENTATIVE          7/10/03      Jeff Kircher
--------------------------------------------------------------------------------
NAME OF SIGNER (print)             136. TITLE OF SIGNER                     137.
Jeff Kircher                            Facilities/Safety Manager
--------------------------------------------------------------------------------

* See Instructions on next page.

<PAGE>

    BUSINESS OWNER/OPERATOR IDENTIFICATION PAGE (OES FORM 2730) INSTRUCTIONS

Except when using the Hazardous Materials Business Plan Certification Form, you
must submit the Business Activities page, the Business Owner/Operator
Identification page, and Hazardous Materials - Chemical Description pages with
all hazardous materials inventory submittals. (Note: Numbering of these
instructions follows the UPCF data element numbers on the Owner/Operator page.)

1.       FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

3.       BUSINESS NAME - Enter the complete Facility Name.

100.     BEGINNING DATE - Enter the beginning year and date of the report.

101.     ENDING DATE - Enter the ending year and date of the report.

102.     BUSINESS PHONE - Enter the phone number, including area code and any
         extension.

103.     BUSINESS SITE ADDRESS - Enter the street address where the facility is
         located, including building number, if applicable. Post office box
         numbers are not acceptable. This information must provide a means to
         locate the facility geographically.

104.     CITY - Enter the city or unincorporated area in which the facility is
         located.

105.     ZIP CODE - Enter the 5 or 9 digit zip code for the facility.

106.     DUN & BRADSTREET - If the business has a D&B number, enter it here.

107.     SIC CODE - Enter the 4 digit Standard Industrial Classification Code
         number for the facility's primary business activity.

108.     COUNTY - Enter the name of the county in which the facility is located.

109.     BUSINESS OPERATOR NAME - Enter the name of the facility operator.

110.     BUSINESS OPERATOR PHONE - Enter the operator's phone number, including
         area code and any extension.

111.     OWNER NAME - Enter the name of the facility owner, if different from
         the operator.

112.     OWNER PHONE - Enter the owner's phone number, including area code and
         any extension.

113.     OWNER MAILING ADDRESS - Enter the owner's street or P.O. box mailing
         address, if different from the site address.

114.     OWNER CITY - Enter the name of the city for the owner's mailing
         address.

115.     OWNER STATE - Enter the 2 character state abbreviation for the owner's
         mailing address.

116.     OWNER ZIP CODE - Enter the 5 or 9 digit zip code for the owner's
         mailing address.

117.     ENVIRONMENTAL CONTACT NAME - Enter the name of the person, if different
         from the Business Owner or Operator, who will receive all environmental
         correspondence and will respond to enforcement activity.

118.     CONTACT PHONE - Enter the environmental contact's phone number,
         including area code and any extension.

119.     CONTACT MAILING ADDRESS - Enter the street or P.O. box mailing address
         where all environmental contact correspondence should be sent, if
         different from the site address.

120.     CITY - Enter the name of the city for the environmental contact's
         mailing address.

121.     STATE - Enter the 2 character state abbreviation for the environmental
         contact's mailing address.

122.     ZIP CODE - Enter the 5 or 9 digit zip code for the environmental
         contact's mailing address.

123.     PRIMARY EMERGENCY CONTACT NAME - Enter the name of a representative
         (i.e. Emergency Coordinator) who can be contacted in case of an
         emergency involving hazardous materials at the facility. This person
         shall have full facility access, site familiarity, and authority to
         make decisions for the business regarding incident mitigation.

124.     TITLE - Enter the title of the primary Emergency Coordinator.

125.     BUSINESS PHONE - Enter primary Emergency Coordinator's business phone
         number, including area code and any extension.

126.     24-HOUR PHONE - Enter a phone number that will be answered 24 hours a
         day. If not the primary Emergency Coordinator's home phone number, then
         the number of an answering service able to immediately contact the
         primary Emergency Coordinator must be provided. Please note that this
         is a public document, so any telephone number provided is available to
         the general public any time a review of your facility's records is
         conducted.

127.     PAGER NUMBER - Enter the pager number for the primary Emergency
         Coordinator, if available.

128.     SECONDARY EMERGENCY CONTACT NAME - Enter the name of a secondary
         Emergency Coordinator who can be contacted in the event that the
         primary Emergency Coordinator is not available. The contact shall have
         full facility access, site familiarity, and authority to make decisions
         for the business regarding incident mitigation.

129.     TITLE - Enter the title of the secondary Emergency Coordinator.

130.     BUSINESS PHONE - Enter secondary Emergency Coordinator's business phone
         number, including area code and any extension.

131.     24-HOUR PHONE - Enter a phone number for the secondary Emergency
         Coordinator. See instructions for item 123, above.

132.     PAGER NUMBER - Enter the pager number for the secondary Emergency
         Coordinator, if available.

133.     ADDITIONAL LOCALLY COLLECTED INFORMATION - Enter the name and phone
         number for the property owner. Enter the complete mailing address to
         which bills for permit fees should be sent, if different from items
         119-122, above.

SIGNATURE OF OWNER/OPERATOR OR DESIGNATED REPRESENTATIVE - The Business
         Owner/Operator, or officially designated representative of the
         Owner/Operator, shall sign in the space provided. This signature
         certifies that the signer is familiar with the information submitted,
         and that based on the signer's inquiry of those individuals responsible
         for obtaining the information, it is the signer's belief that the
         submitted information is true, accurate, and complete.

134.     DATE - Enter the date that the document was signed.

135.     NAME OF DOCUMENT PREPARER - Type or print the full name of the person
         who prepared the Business Plan information.

136.     NAME OF SIGNER - Type or print the full name of the person signing this
         document.

137.     TITLE OF SIGNER - Enter the title of the person signing this document.
<PAGE>

DATE: 2/18/2002         NON-WASTE HAZARDOUS MATERIALS INVENTORY STATEMENT

 For use by Unidocs Member Agencies or where approved by your Local Jurisdiction

<TABLE>
--------------------------------------------------------------------------------------------------------------------------
<S>                                                       <C>                               <C>
BUSINESS NAME: KINETICS FLUID SYSTEMS                     TYPE OF REPORT ON THIS PAGE:      Page ___________ of __________
(Same as Facility Name or DBA)                            [ ] Add; [ ] Delete; [X] Revise   (one page per building or area)
--------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
---------------------------------------------------------------------------------------------------------------------------
<S>                         <C>                           <C>       <C>      <C>                  <C>
CHEMICAL LOCATION: GAS PAD  EPCRA CONFIDENTIAL LOCATION?  [ ] Yes;  [X] No   Facility ID #        4 3 - 0 1 1 - 9 5 0 2 6 0
(Building/Storage Area)     TRADE SECRET INFORMATION?     [ ] Yes;  [X] No   (Agency Use Only)
---------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
  1.      2.              3.                                4.                        5.                           6.
       MAP AND                                     HAZARDOUS COMPONENTS             TYPE                      QUANTITIES
       GRID OR                                      (FOR MIXTURE ONLY)               AND
 HAZ.  LOCATION                          CHEMICAL         %                        PHYSICAL         MAX.        AVERAGE    LARGEST
CLASS    CODE        COMMON NAME          NAME           WT.   EHS     CAS No.      STATE           DAILY        DAILY      CONT.
------------------------------------------------------------------------------------------------------------------------------------
<S>    <C>       <C>                  <C>                <C>  <C>    <C>          <C>          <C>              <C>      <C>
 3               Acetone                                       [ ]                [X] pure         10              5         5
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] Mixture
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] solid    Curies:          Days On  Storage
                 -------------------  -----------------  ---  -----  -----------               (If radioactive) Site:    Container:*
                 CAS No.:   [ ] EHS                            [ ]                [X] liquid                       365    F
                 67-64-1              -----------------  ---  -----  -----------
                                                               [ ]                [ ] gas
------------------------------------------------------------------------------------------------------------------------------------
 2               Argon (liquid)                                [ ]                [X] pure           3100         2500      3100
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] Mixture
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] solid    Curies:          Days On  Storage
                 -------------------  -----------------  ---  -----  -----------               (If radioactive) Site:    Container:*
                 CAS No.:   [ ] EHS                            [ ]                [X] liquid                       365    A
                 7440-37-1            -----------------  ---  -----  -----------
                                                               [ ]                [ ] gas
------------------------------------------------------------------------------------------------------------------------------------
 2               Argon/Helium/Carbon  Argon               50   [ ]    7440-37-1   [ ] pure            330          220       110
                 Dioxide              -----------------  ---  -----  -----------
                                      Helium              25   [ ]    7440-59-7   [X] Mixture
                                      -----------------  ---  -----  -----------
                                      Carbon Dioxide      25   [ ]    124-38-9    [ ] solid    Curies:          Days On  Storage
                 -------------------  -----------------  ---  -----  -----------               (If radioactive) Site:    Container:*
                 CAS No.:   [ ] EHS                            [ ]                [ ] liquid                       365    L
                                      -----------------  ---  -----  -----------
                                                               [ ]                [X] gas
------------------------------------------------------------------------------------------------------------------------------------
 2               Helium                                        [ ]                [X] pure           5227         3645       291
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] Mixture
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] solid    Curies:          Days On  Storage
                 -------------------  -----------------  ---  -----  -----------               (If radioactive) Site:    Container:*
                 CAS No.:   [ ] EHS                            [ ]                [ ] liquid                       365
                 7440-59-7            -----------------  ---  -----  -----------
                                                               [ ]                [X] gas
------------------------------------------------------------------------------------------------------------------------------------
 2               Helium/Nitrogen      Helium                   [ ]    7440-59-7   [ ] pure            627          209       209
                                      -----------------  ---  -----  -----------
                                      Nitrogen                 [ ]    7727-37-9   [X] Mixture
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] solid    Curies:          Days On  Storage
                 -------------------  -----------------  ---  -----  -----------               (If radioactive) Site:    Container:*
                 CAS No.:   [ ] EHS                            [ ]                [ ] liquid                       365    L
                                      -----------------  ---  -----  -----------
                                                               [ ]                [X] gas
------------------------------------------------------------------------------------------------------------------------------------
 2               Hydrogen                                      [ ]                [X] pure           4371         3850       261
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] Mixture
                                      -----------------  ---  -----  -----------
                                                               [ ]                [ ] solid    Curies:          Days On  Storage
                 -------------------  -----------------  ---  -----  -----------               (If radioactive) Site:    Container:*
                 CAS No.:   [ ] EHS                            [ ]                [ ] liquid                       365    L
                 1333-74-0            -----------------  ---  -----  -----------
                                                               [ ]                [X] gas
------------------------------------------------------------------------------------------------------------------------------------

<CAPTION>
------------------------------------------------------------------------------------------------------
  1.      2.              3.                7.                   8.                        9.
       MAP AND                                              STORAGE CODES
       GRID OR
 HAZ.  LOCATION                                         STORAGE       STORAGE             HAZARD
CLASS    CODE        COMMON NAME          UNITS         PRESSURE       TEMP.            CATEGORIES
------------------------------------------------------------------------------------------------------
<S>    <C>       <C>                    <C>           <C>          <C>            <C>
 3               Acetone                [X] gallons   [X] ambient  [X] ambient    [X] fire
                                        [ ] pounds    [ ] > amb.   [ ] > amb.     [ ] reactive
                                        [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release
                                        [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                  [X] chronic health
                 -------------------                                              [ ] radioactive
                 CAS No.:   [ ] EHS
                 67-64-1

------------------------------------------------------------------------------------------------------
 2               Argon (liquid)         [X] gallons   [ ] ambient  [ ] ambient    [ ] fire
                                        [ ] pounds    [X] > amb.   [ ] > amb.     [ ] reactive
                                        [ ] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure release
                                        [ ] tons                   [X] cryogenic  [ ] acute health
                                                                                  [ ] chronic health
                 -------------------                                              [ ] radioactive
                 CAS No.:   [ ] EHS
                 7440-37-1

------------------------------------------------------------------------------------------------------
 2               Argon/Helium/Carbon    [ ] gallons   [ ] ambient  [X] ambient    [ ] fire
                 Dioxide                [ ] pounds    [X] > amb.   [ ] > amb.     [ ] reactive
                                        [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure release
                                        [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                  [ ] chronic health
                 -------------------                                              [ ] radioactive
                 CAS No.:   [ ] EHS

------------------------------------------------------------------------------------------------------
 2               Helium                 [ ] gallons   [ ] ambient  [X] ambient    [ ] fire
                                        [ ] pounds    [X] > amb.   [ ] > amb.     [ ] reactive
                                        [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure release
                                        [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                  [ ] chronic health
                 -------------------                                              [ ] radioactive
                 CAS No.:   [ ] EHS
                 7440-59-7

------------------------------------------------------------------------------------------------------
 2               Helium/Nitrogen        [ ] gallons   [ ] ambient  [X] ambient    [ ] fire
                                        [ ] pounds    [X] > amb.   [ ] > amb.     [ ] reactive
                                        [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure release
                                        [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                  [ ] chronic health
                 -------------------                                              [ ] radioactive
                 CAS No.:   [ ] EHS

------------------------------------------------------------------------------------------------------
 2               Hydrogen               [ ] gallons   [ ] ambient  [X] ambient    [X] fire
                                        [ ] pounds    [X] > amb.   [ ] > amb.     [ ] reactive
                                        [X] cu. feet  [ ] < amb.   [ ] < amb.     [X] pressure release
                                        [ ] tons                   [ ] cryogenic  [ ] acute health
                                                                                  [ ] chronic health
                 -------------------                                              [ ] radioactive
                 CAS No.:   [ ] EHS
                 1333-74-0
------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
*  CODE  STORAGE TYPE          CODE  STORAGE TYPE              CODE  STORAGE TYPE  CODE  STORAGE TYPE    CODE  STORAGE TYPE
   ----  ------------          ----  ------------              ----  ------------  ----  ------------    ----  ------------
<S>      <C>                   <C>   <C>                       <C>   <C>           <C>   <C>             <C>   <C>
    A    Aboveground Tank       D    Steel Drum                 G    Carboy         J    Bag              M    Glass Bottle or Jug

    B    Belowground Tank       E    Plastic/Non-metalic Drum   H    Silo           K    Box              N    Plastic Bottle or Jug

    C    Tank Inside Building   F    Can                        I    Fiber Drum     L    Cylinder         O    Tote Bin
</TABLE>

<TABLE>
<CAPTION>
CODE  STORAGE TYPE
----  ------------
<S>   <C>
 P    Tank Wagon

 Q    Rail Car

 R    Other
</TABLE>

IF EPCRA, SIGN BELOW:

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

UN-020-7/17                    WWW.unidocs.org                      Rev.01/16/02
<PAGE>

         NON-WASTE HAZARDOUS MATERIALS INVENTORY STATEMENT INSTRUCTIONS
    (MODIFIED UPCF HAZARDOUS MATERIALS INVENTORY - CHEMICAL DESCRIPTION PAGE)

All non-waste hazardous materials stored at the facility must be listed on the
Non-Waste Hazardous Materials Inventory Statement [or the Unified Program
Consolidated Form (UPCF) Hazardous Materials Inventory - Chemical Description
form (available on the Internet at WWW.UNIDOCS.ORG)]. This form allows you to
report up to six chemicals on a single page. Do not list hazardous wastes on
this form.

You must complete a separate inventory line for each individual hazardous
material that you handle at your facility in an aggregate quantity subject to
Hazardous Materials Business Plan reporting requirements (please refer to the
Hazardous Materials Business Plan Information Sheet). The completed inventory
must reflect all hazardous materials at your facility, reported separately for
each building or outside storage area, with separate inventory lines for unique
occurrences of physical state, storage temperature, or storage pressure. Trade
secret materials must be listed on separate pages. Where the aggregate
quantities of some hazardous materials are below the Business Plan threshold
reporting quantity, report the general hazard class of the materials (e.g.
"Misc. Flammable Liquids"), rather than the Common Name, and the aggregate
quantity of all hazardous materials having this hazard class which individually
are below the threshold reporting quantity. Make additional copies of this form
if needed. Your local agency may be capable of accepting electronic reporting of
this information. Contact your local agency for details.

1.       DATE - In the space at the top left side of the form, enter the date
         this inventory statement page was prepared.

2.       BUSINESS NAME - Enter the complete Facility Name.

3.       TYPE OF REPORT ON THIS PAGE - Indicate whether the material is being
         added to the inventory, deleted from the inventory, or if the
         information previously submitted is being revised. (Note: You may leave
         this blank if you resubmit your entire inventory annually.)

4.       PAGE NUMBER - Number each page of the inventory appropriately.

5.       CHEMICAL LOCATION - Enter the name of the building or outside area
         where the hazardous materials reported on this page are handled. A
         chemical stored at the same pressure and temperature in multiple
         locations in one building or area can be reported on a single line.

6.       EPCRA CONFIDENTIAL LOCATION - You must check "Yes" to keep chemical
         location information confidential. If you do not wish to keep chemical
         location information confidential check "No," If "Yes," a signature is
         required on the line provided at the bottom of the form.

7.       TRADE SECRET INFORMATION- Check "Yes" if the information in this
         section is declared a trade secret, "No" if it is not. If "Yes," and
         the business is subject to EPCRA, disclosure of designated Trade Secret
         information is bound by 40 CFR and the business must submit a
         "Substantiation to Accompany Claims of Trade Secrecy" form to the
         United States Environmental Protection Agency.

8.       FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

9.       HAZARD CLASS - In Column I of the inventory table, provide the primary
         U.S. Department of Transportation (DOT) numerical hazard class for the
         material being reported on each line.

10.      MAP & GRID OR LOCATION CODE - In Column 2, enter the page number of the
         Storage Map where the location of the hazardous material is shown,
         along with the grid coordinates from your Storage Map that correspond
         to the location of the hazardous material. If applicable, multiple grid
         coordinates can be listed. If you do not use a grid system, enter the
         Location Code shown on your Storage Map.

11.      COMMON NAME, CAS NUMBER, & EHS - In Column 3, enter the following
         information:

         -        COMMON NAME - The Common Name or Trade Name of the hazardous
                  material or mixture (e.g. Gasoline, Acme Super Solvent).

         -        EHS - If the material is considered an Extremely Hazardous
                  Substance as defined in 40 CFR, Part 355, Appendix A, check
                  the EHS box.

         -        CAS NUMBER - Enter the Chemical Abstract Service (CAS) number
                  for the hazardous material. For mixtures, enter the CAS number
                  of the mixture if it has been assigned a number distinct from
                  its components. If the mixture has no CAS number, leave this
                  column blank and report the CAS numbers of the individual
                  hazardous components in the appropriate section, below.

12.      HAZARDOUS COMPONENTS - (Note: If the material is not a mixture, skip
         Column 4 and go directly to Column 5.) In column 4, enter the following
         information regarding Hazardous Components that make up the material
         listed in Column 3:

         -        CHEMICAL NAME - If the Chemical Name is the same as the Common
                  or Trade Name shown in Column 3, you may leave this space
                  blank. If the material is a mixture, list the chemical name of
                  each hazardous component in the mixture ranked by percent
                  weight (refer to the MSDS or manufacturer). All hazardous
                  components present at greater than 1% by weight if
                  non-carcinogenic, or 0.1% by weight if carcinogenic, must be
                  reported. If more than five hazardous components exceed these
                  percentages, you may attach an additional sheet of paper to
                  report the required information.

         -        % BY WEIGHT - Enter the percentage weight of each hazardous
                  component. If a range of percentages is available, report the
                  highest percentage in that range.

         -        EHS - Check the box provided if the component of the mixture
                  is considered an Extremely Hazardous Substance.

         -        CAS NUMBER - List the Chemical Abstract Service (CAS) number
                  for each hazardous component.

13.      TYPE & PHYSICAL STATE - In column 5, identify the material type and
         physical state by checking the "pure" or "mixture box and the "solid",
         "liquid", or "gas" box.

14.      QUANTITIES - In the appropriate spaces within column 6, list:

         -        MAXIMUM DAILY AMOUNT* - Enter the maximum amount of the
                  hazardous material or mixture handled in this building or
                  outside area at any one time over the course of the year. This
                  amount must contain, at a minimum, last year's reported
                  inventory with the reflection of additions, deletions, or
                  revisions projected for the current year.

         -        AVERAGE DAILY AMOUNT* - Calculate the average daily amount of
                  the hazardous material or mixture in this building or outside
                  area. If this is a material that is new to this location, the
                  amount should be the average daily amount you project to be on
                  hand during the course of the year.

         -        LARGEST CONTAINER* - Enter the volume of the largest container
                  in which the material is handled at the location.

         -        CURIES - If the material is radioactive, use the space
                  provided to report the activity in curies.

         -        DAYS ON SITE - Enter the total number of days (e.g. 365)
                  during the year that the material is on site.

         -        STORAGE CONTAINER - Using the container codes listed at the
                  bottom of the inventory statement, list every type of
                  container in which the material is stored/handled.

         -        Except for Curies, units of measure must be the same as that
                  indicated in Column 7.

15.      UNITS - In column 7, check the appropriate unit of measure: gallons for
         liquids, pounds or tons for solids, and cubic feet for gases. If the
         material is a federally defined EHS and is not a mixture, all amounts
         must be reported in pounds.

16.      STORAGE CODES - In the appropriate spaces within Column 8, list:

         -        STORAGE PRESSURE - Check the box that best describes the
                  pressure at which the material is stored: ambient (standard),
                  > amb. (greater than ambient), < amb. (less than ambient), or
                  cryogenic.

         -        STORAGE TEMPERATURE -Check the box that best describes the
                  temperature at which the material is stored.

17.      HAZARD CATEGORIES - In column 9, check the box(es) to describe all
         physical, health, and radioactivity hazards associated with the
         hazardous material.

<TABLE>
<CAPTION>
                     PHYSICAL HAZARDS                                                 HEALTH HAZARDS
                     ----------------                                                 --------------
<S>                                                         <C>
FIRE:  Flammable Liquids and Solids, Combustible Liquids,   ACUTE HEALTH (IMMEDIATE): Toxics, Highly Toxics, Irritants, Sensitizers,
       Pyrophorics, Oxidizers                                     Corrosives, other hazardous chemicals with an adverse effect with
                                                                  short-term exposure
REACTIVE:   Unstable Reactives, Organic Peroxides, Water
       Reactives, Radioactives

PRESSURE RELEASE: Explosives, Compressed Gases, Blasting    CHRONIC HEALTH (DELAYED): Carcinogens, other chemicals with an adverse
      Agents                                                      effect with long-term exposure
</TABLE>
<PAGE>

DATE: 2/18/2002            HAZARDOUS WASTE INVENTORY STATEMENT
For use by Unidocs Member Agencies or where approved by your Local Jurisdiction

<TABLE>
-----------------------------------------------------------------------------------------------------
<S>                                     <C>                             <C>
BUSINESS NAME: KINETICS FLUID SYSTEMS   TYPE OF REPORT ON THIS PAGE:    Page ___________ of ________
(Same as Facility Name or DBA)          [ ]Add; [ ] Delete; [X] Revise  (One page per building or area)
-----------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
-------------------------------------------------------------------------------------------------------------------
<S>                     <C>                           <C>       <C>     <C>               <C>
CHEMICAL LOCATION:      EPCRA CONFIDENTIAL LOCATION?  [ ] Yes;  [X] No  FACILITY ID#      4 3 - 0 1 1 - 9 5 0 2 6 0
(Building/storage Area  TRADE SECRET INFORMATION?     [ ] Yes;  [X] No  (Agency Use Only)
-------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
  1.       2.             3.                       4.                   5.                           6.                       7.
        MAP AND                                                        TYPE
        GRID OR                           HAZARDOUS COMPONENTS         AND                      QUANTITIES                  ANNUAL
 HAZ.  LOCATION                         CHEMICAL  %                  PHYSICAL         MAX.        AVERAGE     LARGEST       WASTE
CLASS   CODE       WASTE STREAM NAME      NAME   Wt.  EHS  CAS NO.     STATE         DAILY         DAILY       CONT.        AMOUNT
------------------------------------------------------------------------------------------------------------------------------------
<S>    <C>       <C>                    <C>      <C>  <C>  <C>      <C>         <C>              <C>        <C>          <C>
                                                      [ ]           [X] waste
                 ---------------------  -------- ---  ---  -------
                 MANAGEMENT METHOD:                   [ ]
                                        -------- ---  ---  -------
                 [ ] Shipped Off-site                 [ ]           [ ] solid   Curies:           Days On   Storage      State
                                        -------- ---  ---  -------
                 [ ] Recycled On-site                 [ ]           [ ] liquid  (If radioactive)  Site:     Container.*  Waste Code:
                                        -------- ---  ---  -------
                 [ ] Treated On-site                  [ ]           [ ] gas

------------------------------------------------------------------------------------------------------------------------------------
                                                      [ ]           [X] waste
                 ---------------------  -------- ---  ---  -------
                 MANAGEMENT METHOD:                   [ ]
                                        -------- ---  ---  -------
                 [ ] Shipped Off-site                 [ ]           [ ] solid   Curies:           Days On   Storage      State
                                        -------- ---  ---  -------
                 [ ] Recycled On-site                 [ ]           [ ] liquid  (If radioactive)  Site:     Container.*  Waste Code:
                                        -------- ---  ---  -------
                 [ ] Treated On-site                  [ ]           [ ] gas

------------------------------------------------------------------------------------------------------------------------------------
                                                      [ ]           [X] waste
                 ---------------------  -------- ---  ---  -------
                 MANAGEMENT METHOD:                   [ ]
                                        -------- ---  ---  -------
                 [ ] Shipped Off-site                 [ ]           [ ] solid   Curies:           Days On   Storage      State
                                        -------- ---  ---  -------
                 [ ] Recycled On-sit                  [ ]           [ ] liquid  (If radioactive)  Site:     Container.*  Waste Code:
                                        -------- ---  ---  -------
                 [ ] Treated On-site                  [ ]           [ ] gas

------------------------------------------------------------------------------------------------------------------------------------
                                                      [ ]           [X] waste
                 ---------------------  -------- ---  ---  -------
                 MANAGEMENT METHOD:                   [ ]
                                        -------- ---  ---  -------
                 [ ] Shipped Off-site                 [ ]           [ ] solid   Curies:           Days On   Storage      State
                                        -------- ---  ---  -------
                 [ ] Recycled On-site                 [ ]           [ ] liquid  (If radioactive)  Site:     Container.*  Waste Code:
                                        -------- ---  ---  -------
                 [ ] Treated On-site                  [ ]           [ ] gas

------------------------------------------------------------------------------------------------------------------------------------
                                                      [ ]           [X] waste
                 ---------------------  -------- ---  ---  -------
                 MANAGEMENT METHOD:                   [ ]
                                        -------- ---  ---  -------
                 [ ] Shipped Off-site                 [ ]           [ ] solid   Curies:           Days On   Storage      State
                                        -------- ---  ---  -------
                 [ ] Recycled On-site                 [ ]           [ ] liquid  (If radioactive)  Site:     Container.*  Waste Code:
                                        -------- ---  ---  -------
                 [ ] Treated On-site                  [ ]           [ ] gas

------------------------------------------------------------------------------------------------------------------------------------
                                                      [ ]           [X] waste
                 ---------------------  -------- ---  ---  -------
                 MANAGEMENT METHOD:                   [ ]
                                        -------- ---  ---  -------
                 [ ] Shipped Off-site                 [ ]           [ ] solid   Curies:           Days On   Storage      State
                                        -------- ---  ---  -------
                 [ ] Recycled On-site                 [ ]           [ ] liquid  (If radioactive)  Site:     Container.*  Waste Code:
                                        -------- ---  ---  -------
                 [ ] Treated On-site                  [ ]           [ ] gas

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

<CAPTION>
-------------------------------------------------------------------------------------------------
  1.       2.             3.                 8.                 9.                    10.
        MAP AND
        GRID OR                                           STORAGE CODES
 HAZ.  LOCATION                                        STORAGE      STORAGE         HAZARD
CLASS   CODE       WASTE STREAM NAME        UNITS      PRESSURE       TEMP.        CATEGORIES
-------------------------------------------------------------------------------------------------
<S>    <C>       <C>                    <C>           <C>          <C>            <C>
                                        [ ] gallons   [ ] ambient  [ ] ambient    [ ] fire
                 ---------------------
                 MANAGEMENT METHOD:     [ ] pounds    [ ] > amb.   [ ] > amb.     [ ] reactive

                 [ ] Shipped Off-site   [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release

                 [ ] Recycled On-site   [ ] tons                   [ ] cryogenic  [ ] acute health

                 [ ] Treated On-site                                              [ ] chronic health
                                                                                  [ ] radioactive
-------------------------------------------------------------------------------------------------
                                        [ ] gallons   [ ] ambient  [ ] ambient    [ ] fire
                 ---------------------
                 MANAGEMENT METHOD:     [ ] pounds    [ ] > amb.   [ ] > amb.     [ ] reactive

                 [ ] Shipped Off-site   [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release

                 [ ] Recycled On-site   [ ] tons                   [ ] cryogenic  [ ] acute health

                 [ ] Treated On-site                                              [ ] chronic health
                                                                                  [ ] radioactive
-------------------------------------------------------------------------------------------------
                                        [ ] gallons   [ ] ambient  [ ] ambient    [ ] fire
                 ---------------------
                 MANAGEMENT METHOD:     [ ] pounds    [ ] > amb.   [ ] > amb.     [ ] reactive

                 [ ] Shipped Off-site   [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release

                 [ ] Recycled On-sit    [ ] tons                   [ ] cryogenic  [ ] acute health

                 [ ] Treated On-site                                              [ ] chronic health
                                                                                  [ ] radioactive
-------------------------------------------------------------------------------------------------
                                        [ ] gallons   [ ] ambient  [ ] ambient    [ ] fire
                 ---------------------
                 MANAGEMENT METHOD:     [ ] pounds    [ ] > amb.   [ ] > amb.     [ ] reactive

                 [ ] Shipped Off-site   [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release

                 [ ] Recycled On-site   [ ] tons                   [ ] cryogenic  [ ] acute health

                 [ ] Treated On-site                                              [ ] chronic health
                                                                                  [ ] radioactive
-------------------------------------------------------------------------------------------------
                                        [ ] gallons   [ ] ambient  [ ] ambient    [ ] fire
                 ---------------------
                 MANAGEMENT METHOD:     [ ] pounds    [ ] > amb.   [ ] > amb.     [ ] reactive

                 [ ] Shipped Off-site   [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release

                 [ ] Recycled On-site   [ ] tons                   [ ] cryogenic  [ ] acute health

                 [ ] Treated On-site                                              [ ] chronic health
                                                                                  [ ] radioactive
-------------------------------------------------------------------------------------------------
                                        [ ] gallons   [ ] ambient  [ ] ambient    [ ] fire
                 ---------------------
                 MANAGEMENT METHOD:     [ ] pounds    [ ] > amb.   [ ] > amb.     [ ] reactive

                 [ ] Shipped Off-site   [ ] cu. feet  [ ] < amb.   [ ] < amb.     [ ] pressure release

                 [ ] Recycled On-site   [ ] tons                   [ ] cryogenic  [ ] acute health

                 [ ] Treated On-site                                              [ ] chronic health
                                                                                  [ ] radioactive
-------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
* Code  Storage Type             Code  Storage Type                Code  Storage Type     Code  Storage Type
------  ------------             ----  ------------                ----  ------------     ----  ------------
<S>     <C>                      <C>   <C>                         <C>   <C>              <C>   <C>
   A    Above ground Tank         D    Steel Drum                   G    Carboy            J    Bag
   B    Below ground Tank         E    Plastic/Nonmetalic Drum      H    Silo              K    Box
   C    Tank Inside Building      F    can                          I    Fiber Drum        L    Cylinder
</TABLE>

<TABLE>
<CAPTION>
Code  Storage Type            Code  Storage Type   IF EPCRA, SIGN BELOW:
----  ------------            ----  ------------
<S>   <C>                     <C>   <C>            <C>
 M    Glass Bottle or Jug      P    Tank Wagon
 N    Plastic Bottle or Jug    Q    Rail Car       _____________________
 O    Tote Bin                 R    Other
</TABLE>

UN-020-9/17                     WWW.UNIDOCS.ORG                    REV. 01/16/02
<PAGE>

                HAZARDOUS WASTE INVENTORY STATEMENT INSTRUCTIONS
    (MODIFIED UPCF HAZARDOUS MATERIALS INVENTORY - CHEMICAL DESCRIPTION PAGE)

All hazardous wastes handled at the facility must be listed on the Hazardous
Waste Inventory Statement [or the Unified Program Consolidated Form (UPCF)
Hazardous Materials Inventory - Chemical Description form (available on the
Internet at WWW.UNIDOCS.ORG)]. This form allows you to report up to six wastes
on a single page. Do not list non-waste hazardous materials on this form.

You must complete a separate inventory line for each individual hazardous waste
that you handle at your facility in an aggregate quantity subject to Hazardous
Materials Business Plan reporting requirements (please refer to the Hazardous
Materials Business Plan Information Sheet). The completed inventory must reflect
all hazardous wastes at your facility, reported separately for each building or
outside storage area, with separate inventory lines for unique occurrences of
physical state, storage temperature, or storage pressure. Trade secret wastes
must be listed on separate pages. Make additional copies of this form if needed.
Your local agency may be capable of accepting electronic reporting of this
information. Contact your local agency for details.

1.       DATE - In the space at the top left side of the form, enter the date
         this inventory statement page was prepared.

2.       BUSINESS NAME - Enter the complete Facility Name.

3.       TYPE OF REPORT ON THIS PAGE - Indicate whether the waste is being added
         to the inventory, deleted from the inventory, or if the information
         previously submitted is being revised. (Note: You may leave this blank
         if you resubmit your entire inventory annually.)

4.       PAGE NUMBER - Number each page of the inventory appropriately.

5.       CHEMICAL LOCATION-Enter the name of the building or outside area where
         the hazardous wastes reported on this page are handled. A waste stored
         at the same pressure and temperature in multiple locations in one
         building or area can be reported on a single line.

6.       EPCRA CONFIDENTIAL LOCATION - You must check "Yes" to keep chemical
         location information confidential. If you do not wish to keep chemical
         location information confidential check "No." If "Yes," a signature is
         required on the line provided at the bottom of the form.

7.       TRADE SECRET INFORMATION- Check "Yes" if the information in this
         section is declared a trade secret, "No" if it is not. If "Yes," and
         the business is subject to EPCRA, disclosure of designated Trade Secret
         information is bound by 40 CFR and the business must submit a
         "Substantiation to Accompany Claims of Trade Secrecy" form to the
         United States Environmental Protection Agency.

8.       FACILITY ID NUMBER - This number is for agency use only. Leave this
         space blank.

9.       HAZARD CLASS - In Column 1 of the inventory table, provide the primary
         U.S. Department of Transportation (DOT) numerical hazard class for the
         waste being reported on each line.

10.      MAP & GRID OR LOCATION CODE - In Column 2, enter the page number of the
         Storage Map where the location of the hazardous waste is shown, along
         with the grid coordinates from your Storage Map that correspond to the
         location of the hazardous waste. If applicable, multiple grid
         coordinates can be listed. If you do not use a grid system, enter the
         Location Code shown on your Storage Map.

11.      WASTE STREAM NAME & MANAGEMENT METHOD - In Column 3, enter the
         following information:

         -        WASTE STREAM NAME - The Common Name of the hazardous waste
                  (e.g. Used Oil, Spent Solvent).

         -        MANAGEMENT METHOD - Check the appropriate box(es) to indicate
                  how you manage the waste.

12.      HAZARDOUS COMPONENTS - In column 4, enter the following information
         regarding Hazardous Components that make up the waste listed in Column
         3:

         -        CHEMICAL NAME - List the chemical name of each hazardous
                  component in the mixture ranked by percent weight. All
                  hazardous components present at greater than 1% by weight if
                  non-carcinogenic, or 0.1% by weight if carcinogenic, must be
                  reported. If more than five hazardous components exceed these
                  percentages, you may attach an additional sheet of paper to
                  report the required information.

         -        % BY WEIGHT - Enter the percentage weight of each hazardous
                  component. If a range of percentages is available, report the
                  highest percentage in that range.

         -        EHS - Check the box provided if the component of the mixture
                  is considered an Extremely Hazardous Substance as defined in
                  40 CFR, Part 355, Appendix A.

         -        CAS NUMBER - List the Chemical Abstract Service (CAS) number
                  for each hazardous component.

13.      TYPE & PHYSICAL STATE - In column 5, identify the physical state by
         checking the "solid", "liquid", or "gas" box.

14.      QUANTITIES - In the appropriate spaces within column 6, list:

         -        MAXIMUM DAILY AMOUNT* - Enter the maximum amount of the
                  hazardous waste handled in this building or outside area at
                  any one time over the course of the year. This amount must
                  contain, at a minimum, last year's reported inventory with the
                  reflection of additions, deletions, or revisions projected for
                  the current year.

         -        AVERAGE DAILY AMOUNT* - Calculate the average daily amount of
                  the hazardous waste or mixture in this building or outside
                  area. If this is a waste that is new to this location, the
                  amount should be the average daily amount you project to be on
                  hand during the course of the year.

         -        LARGEST CONTAINER* - Enter the volume of the largest container
                  in which the waste is handled at the location.

         -        CURIES - If the waste is radioactive, use the space provided
                  to report the activity in curies.

         -        DAYS ON SITE - Enter the total number of days (e.g. 365)
                  during the year that the waste is on site. (Note: This does
                  not refer to the accumulation time limit for individual waste
                  containers.)

         -        STORAGE CONTAINER - Using the container codes listed at the
                  bottom of the inventory statement, list every type of
                  container in which the waste is stored/handled.

         *        Except for Curies, units of measure must be the same as that
                  indicated in Column 8.

15.      ANNUAL WASTE AMOUNT - Enter the total quantity of this waste generated
         annually. Use the same unit of measure as that indicated in Column 8.

16.      UNITS - In column 8, check the appropriate unit of measure: gallons for
         liquids, pounds or tons for solids, and cubic feet for gases. If the
         waste is a federally defined EHS and is not a mixture, all amounts must
         be reported in pounds.

17.      STORAGE CODES - In the appropriate spaces within Column 9, list:

         -        STORAGE PRESSURE - Check the box that best describes the
                  pressure at which the waste is stored: ambient (standard), >
                  amb. (greater than ambient), < amb. (less than ambient), or
                  cryogenic.

         -        STORAGE TEMPERATURE - Check the box that best describes the
                  temperature at which the waste is stored.

18.      HAZARD CATEGORIES - In column 10, check the box(es) to describe all
         physical, health, and radioactivity hazards associated with the
         hazardous waste.

<TABLE>
<CAPTION>
                        PHYSICAL HAZARDS                                                HEALTH HAZARDS
-----------------------------------------------------------------------------------------------------------------------------
<S>                                                             <C>
FIRE:    Flammable Liquids and Solids, Combustible Liquids,     ACUTE HEALTH (IMMEDIATE): Toxics, Highly Toxics, Irritants,
         Pyrophorics, Oxidizers                                          Sensitizers, Corrosives, other hazardous chemicals
                                                                         with an adverse effect with short-term exposure

REACTIVE: Unstable Reactives, Organic Peroxides, Water
         Reactives, Radioactives

PRESSURE RELEASE: Explosives, Compressed Gases, Blasting        CHRONIC HEALTH (DELAYED): Carcinogens, other chemicals with
         Agents                                                          an adverse effect with long-term exposure
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

                         FACILITY SITE PLAN/STORAGE MAP
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)

Site Address:___________________________________________________________________

Date Map Drawn: _/_/__.             Map Scale:___________________     Page__of__

   A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

 1
 2
 3
 4
 5
 6
 7
 8
 9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
   INSTRUCTIONS ARE PRINTED ON THE FOLLOWING PAGE.

<PAGE>

                 FACILITY SITE PLAN AND STORAGE MAP INSTRUCTIONS
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)

A Site Plan (public document) and Storage Map (confidential document) must be
included with your HMBP. For relatively small facilities, these documents may be
combined into one drawing. However, if combined, the combined Site Plan/Storage
Map will become a public document. If you are concerned about displaying the
storage locations of hazardous materials to the public, you must provide a
separate facility Storage Map. Since these drawings are intended for use in
emergency response situations, larger facilities (generally those with complex
and/or multiple buildings) should provide an overall site plan and a separate
storage map for each building/storage area. A blank Facility Site Plan/Storage
Map sheet has been provided on the previous page. You may complete that page or
attach any other drawing(s) that contain(s) the information required below:

1.       Site Plan (public document): This drawing shall contain, at a minimum,
         the following information:

         a.       An indication of North Direction;

         b.       Approximate scale (e.g. "1 inch = 10 feet".);

         c.       Date the map was drawn;

         d.       All streets bordering the facility;

         e.       Locations of all buildings and other structures;

         f.       Parking lots and internal roads;

         g.       Hazardous materials loading/unloading areas;

         h.       Outside hazardous materials storage or use areas;

         i.       Storm drain and sanitary sewer drain inlets;

         j.       Wells for monitoring of underground tank systems;

         k.       Primary and alternate evacuation routes, emergency exits, and
                  primary and alternate staging areas.

2.       Storage Map (confidential): The map(s) shall contain, at a minimum, the
         following information:

         a.       General purpose of each section/area within each building
                  (e.g. "Office Area", "Manufacturing Area", etc.);

         b.       Location of each hazardous material/waste storage, dispensing,
                  use, or handling area (e.g. individual underground tanks,
                  aboveground tanks, storage rooms, paint booths, etc.). Each
                  area shall be identifiable by a Grid Number, to be used in
                  item 204 on the Hazardous Materials Inventory - Chemical
                  Description pages of the Business Plan.

         c.       For tanks, the capacity limit in gallons and common name of
                  the hazardous material contained in each tank.

         d.       Entrances to and exits from each building and hazardous
                  material/waste room/area;

         e.       Location of each utility emergency shut-off point (i.e. gas,
                  water, electric.);

         f.       Location of each monitoring system control panel (e.g.
                  underground tank monitoring, toxic gas monitoring, etc.).

<PAGE>

                       EMERGENCY RESPONSE/CONTINGENCY PLAN
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)
         Authority Cited: HSC, Section 25504(b); Title 22, Div. 4.5, Ch.
                                 12, Art. 3 CCR               Page______of______

All facilities that handle hazardous materials in specified quantities must have
a written emergency response plan. In addition, . facilities that generate 1,000
kilograms or more of hazardous waste per month, or accumulate more than 6,000
kilograms of hazardous waste on-site at any one time, must prepare a contingency
plan. Because the requirements are similar, they have been combined in a single
document, provided below, for your convenience. This plan is a required module
of the Hazardous Materials Business Plan (HMBP). If yon already have a plan that
meets these requirements, you should not complete the blank plan, below, but you
must include a copy of your existing plan as part of your HMBP.

This site-specific Emergency Response/Contingency Plan is the facility's plan
for dealing with emergencies and shall be implemented immediately whenever there
is a fire, explosion, or release of hazardous materials that could threaten
human health and/or the environment At least one copy of the plan shall be
maintained at the facility for use in the event of an emergency and for
inspection by the local agency. Within Santa Clara County, hospitals and police
agencies have delegated receipt of these plans to the local agencies
administering Hazardous Materials Business Plans, so additional copies need not
be submitted. However, a copy of the plan and any revisions must be provided to
any contractor, hospital, or agency with whom special (i.e. contractual)
emergency services arrangements have been made (see section 3, below).

1.       EVACUATION PLAN:

         a.    The following alarm signal(s) will be used to begin evacuation of
               the facility (check all that apply):

             [ ] Bells; [ ] Horns/Sirens; [X] Verbal (i.e. shouting); [X] Other
             (specify) PAGING SYSTEM USING TELEPHONE SYSTEM

         b.    [ ] Evacuation map is prominently displayed throughout the
               facility.

Note:    A properly completed HMBP Site Plan satisfies contingency plan map
         requirements. This drawing (or any other drawing that shows primary and
         alternate evacuation routes, emergency exits, and primary and alternate
         staging areas) must be prominently posted throughout the facility in
         locations where it will be visible to employees and visitors.

<TABLE>
<S>                                                                                   <C>
2.       a.    EMERGENCY CONTACTS*:

               Fire/Police/Ambulance ...........................................      Phone No. 911

               State Office of Emergency Services ..............................      Phone No. (800) 852-7550

         b.    Post-Incident Contacts*:

        Fire Department Hazardous Materials Program ............................      Phone No.: (408) 586-2800

        Santa Clara County Hazardous Materials Compliance Division .............      Phone No. (408) 918-3400

        California EPA Department of Toxic Substances Control ..................      Phone No, (510) 540-3739

        Cal-OSHA Division of Occupational Safety and Health ....................      Phone No. (408) 452-7288

        Air Quality Management District ........................................      Phone No. (415) 771-6000

        Regional Water Quality Control Board ...................................      Phone No. (510) 622-2300
</TABLE>

         * These telephone numbers are provided as a general aid to emergency
         notification. Be advised that additional agencies may be required to be
         notified.

<TABLE>
<S>                                                                                   <C>
c. Emergency Resources:

         Poison Control Center..................................................      Phone No. (800) 876-4766

         Nearest Hospital:   Name: Regional Medical Center                            Phone No.: (408) 259-5000

                             Address: 225 North Jackson Avenue                        City: San Jose, CA
</TABLE>

3.       ARRANGEMENTS WITH EMERGENCY RESPONDERS:

If you have made special (i.e. contractual) arrangements with any police
department, fire department, hospital, contractor, or State or local emergency
response team to coordinate emergency services, describe those arrangements
below:
________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

<PAGE>

EMERGENCY RESPONSE/CONTINGENCY PLAN (HMBP MODULE)               Page_____of_____

4.       EMERGENCY PROCEDURES:

Emergency Coordinator Responsibilities:

a.       Whenever there is an imminent or actual emergency situation such as a
         explosion, fire, or release, the emergency coordinator (or his/her
         designee when the emergency coordinator is on call) shall:

         i.       Identify the character, exact source, amount, and areal extent
                  of any released hazardous materials.

         ii.      Assess possible hazards to human health or the environment
                  that may result from the explosion, fire, or release. This
                  assessment must consider both direct and indirect effects
                  (e.g. the effects of any toxic, irritating, or asphyxiating
                  gases that are generated, the effects of any hazardous surface
                  water run-off from water or chemical agents used to control
                  fire, etc.).

         iii.     Activate internal facility alarms or communications systems,
                  where applicable, to notify all facility personnel.

         iv.      Notify appropriate local authorities (i.e. call 911).

         v.       Notify the State Office of Emergency Services at
                  1-800-852-7550.

         vi.      Monitor for leaks, pressure build-up, gas generation, or
                  ruptures in valves, pipes, or other equipment shut down in
                  response to the incident.

         vii.     Take all reasonable measures necessary to ensure that fires,
                  explosions, and releases do not occur, recur, or spread to
                  other hazardous materials at the facility.

b.       Before facility operations are resumed in areas of the facility
         affected by the incident, the emergency coordinator shall:

         i.       Provide for proper storage and disposal of recovered waste,
                  contaminated soil or surface water, or any other material that
                  results from a explosion, fire, or release at the facility.

         ii.      Ensure that no material that is incompatible with the released
                  material is transferred, stored, or disposed of in areas of
                  the facility affected by the incident until cleanup procedures
                  are completed.

         iii.     Ensure that all emergency equipment is cleaned, fit for its
                  intended use, and available for use.

         iv.      Notify the California Environmental Protection Agency's
                  Department of Toxic Substances Control, the County of Santa
                  Clara's Hazardous Materials Compliance Division, and the local
                  fire department's hazardous materials program that the
                  facility is in compliance with requirements b-i and b-ii,
                  above.

Responsibilities of Other Personnel:

On a separate page, list any emergency response functions not covered in the
"Emergency Coordinator Responsibilities" section, above. Next to each function,
list the job title or name of each person responsible for performing the
function. Number the page(s) appropriately.

5.       POST-INCIDENT REPORTING/RECORDING:

The time, date, and details of any hazardous materials incident that requires
implementation of this plan shall be noted in the facility's operating record.

Within 15 days of any hazardous materials emergency incident or threatened
hazardous materials emergency incident that triggers implementation of this
plan, a written Emergency Incident Report, including, but not limited to a
description of the incident and the facility's response to the incident, must be
submitted to the California Environmental Protection Agency's Department of
Toxic Substances Control, the County of Santa Clara's Hazardous Materials
Compliance Division, and the local fire department's hazardous materials
program. The report shall include:

         a.       Name, address, and telephone number of the facility's
                  owner/operator;

         b.       Name, address, and telephone number of the facility;

         c.       Date, time, and type of incident (e.g. fire, explosion, etc.);

         d.       Name and quantity of material(s) involved;

         e.       The extent of injuries, if any;

         f.       An assessment of actual or potential hazards to human health
                  or the environment, where this is applicable;

         g.       Estimated quantity and disposition of recovered material that
                  resulted from the incident;

         h.       Cause(es) of the incident;

         i.       Actions taken in response to the incident;

         j.       Administrative or engineering controls designed to prevent
                  such incidents in the future.

6.       EARTHQUAKE VULNERABILITY: [19 CCR Section 2731(e)]

Identify any areas of the facility and mechanical or other systems that require
immediate inspection or isolation because of their vulnerability to
earthquake-related ground motion:

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

<PAGE>

EMERGENCY RESPONSE/CONTINGENCY PLAN                                Page___of____

7.       EMERGENCY EQUIPMENT:

22 CCR Section 66265.52(e) [as referenced by 22 CCR Section 66262.34(a)(4)] and
the Hazardous Materials Storage Ordinance require that emergency equipment at
the facility be listed. Completion of the following Emergency Equipment
Inventory Table meets this requirement.

                       EMERGENCY EQUIPMENT INVENTORY TABLE

<TABLE>
<CAPTION>
    1.                                2.                                3.                           4.
EQUIPMENT                         EQUIPMENT
CATEGORY                            TYPE                           LOCATIONS *                  DESCRIPTION**
----------------------------------------------------------------------------------------------------------------------------------
<S>              <C>                                               <C>           <C>
PERSONAL         [  ] Cartridge Respirators
PROTECTIVE       [  ] Chemical Monitoring Equipment (describe)
EQUIPMENT,       [  ] Chemical Protective Aprons/Coats
SAFETY           [  ] Chemical Protective Boots
EQUIPMENT,       [  ] Chemical Protective Gloves                   MFG areas     Nitrile, thin-walled, disposable
AND              [XX] Chemical Protective Suits (describe)
FIRST AID        [XX] Face Shields                                 Mach shop     Polycoat, full-faced, used with safety glasses
EQUIPMENT        [XX] First Aid Kits/Stations (describe)           See map       Simple cuts, lacerations, and abrasions
                 [XX] Hard Hats                                    Receiving     Standard hard hat
                 [XX] Plumbed Eye Wash Stations                    Mach shop,    Saline solution, 15 min flush
                                                                   R&D
                 [XX] Portable Eye Wash Kits (i.e. bottle type)    Stock room    2 squeeze bottles
                 [  ] Respirator Cartridges (describe)

                 [XX] Safety Glasses/Splash Goggles                MFG areas,    Standard ANSI safety glasses
                                                                   Mach Shop
                 [  ] Safety Showers
                 [  ] Self-contained Breathing Apparatuses (SCBA)
                 [  ] Other (describe)

FIRE             [XX] Automatic Fire Sprinkler Systems             See map
EXTINGUISHING    [  ] Fire Alarm Boxes/Stations
SYSTEMS          [  ] Fire Extinguisher Systems (describe)
                 [XX] Other (describe)                             See map       ABC, C02, Halotron

SPILL            [  ] Absorbents (describe)
CONTROL          [  ] Berms/Dikes (describe)
EQUIPMENT        [  ] Decontamination Equipment (describe)
AND              [  ] Emergency Tanks (describe)
DECONTAMINATION  [  ] Exhaust Hoods
EQUIPMENT        [  ] Gas Cylinder Leak Repair Kits (describe)
                 [  ] Neutralizes (describe)
                 [  ] Overpack Drums
                 [  ] Sumps (describe)
                 [  ] Other (describe)

COMMUNICATIONS   [XX] Chemical Alarms (describe)                   Weld areas    02, LEL
AND              [  ] Intercoms/ PA Systems
ALARM            [XX] Portable Radios                              See map
SYSTEMS          [XX] Telephones                                   All areas     Paging option through PBX system
                 [  ] Underground Tank Leak Detection Monitors
                 [  ] Other (describe)

ADDITIONAL       [  ]
EQUIPMENT        [  ]
(Use Additional  [  ]
Pages if         [  ]
Needed.)         [  ]
                 [  ]

</TABLE>

         *        Use the map and grid numbers from the Storage Map prepared
                  earlier for your HMBP.

         **       Describe the equipment and its capabilities. If applicable,
                  specify any testing/maintenance procedures/intervals. Attach
                  additional pages, numbered appropriately, if needed.

<PAGE>

                             EMPLOYEE TRAINING PLAN
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)
             Authority Cited: HSC, Section 25504(c); Title 22, Div.
                             4.5, Ch. 12, Art. 3 CCR                Page___of___

All facilities that handle hazardous materials must have a written employee
training plan. This plan is a required module of the Hazardous Materials
Business Plan (HMBP). A blank plan has been provided below for you to complete
and submit if you do not already have such a plan. IF YOU ALREADY HAVE A BRIEF
WRITTEN DESCRIPTION OF YOUR TRAINING PROGRAM THAT ADDRESSES ALL SUBJECTS COVERED
BELOW, YOU ARE NOT REQUIRED TO COMPLETE THE BLANK PLAN, BELOW, BUT YOU MUST
INCLUDE A COPY OF YOUR EXISTING DOCUMENT AS PART OF YOUR HMBP.

Check all boxes that apply. [Note: Items marked with an asterisk (*) are
required.]:

1. PERSONNEL are trained in the following procedures:

<TABLE>
<S>                                                                                     <C>
[X] Internal alarm/notification *
[X] Evacuation/re-entry procedures & assembly point locations*
[X] Emergency  incident reporting
[X] External emergency response organization notification
[X] Location(s) and contents of Emergency Response/Contingency Plan
[X] Facility evacuation drills, that are conducted at least (specify) Quarterly         (e.g. "Quarterly", etc.)
</TABLE>

2. CHEMICAL HANDLERS are additionally trained in the following:

[X] Safe methods for handling and storage of hazardous materials *
[X] Location(s) and proper use of fire and spill control equipment
[X] Spill procedures/emergency procedures
[X] Proper use of personal protective equipment *
[X] Specific hazard(s) of each chemical to which they may be exposed, including
    routes of exposure (i.e. inhalation, ingestion, absorption) *
[ ] Hazardous Waste Handlers/Managers are trained in all aspects of hazardous
    waste management specific to their job duties (e.g. container accumulation
    time requirements, labeling requirements, storage area inspection
    requirements, manifesting requirements, etc.) *

3. EMERGENCY RESPONSE TEAM MEMBERS are capable of and engaged in the following:

<TABLE>
<S>                                                                                     <C>
[ ] Personnel rescue procedures
[ ] Shutdown of operations
[ ] Liaison with responding agencies
[ ] Use, maintenance, and replacement of emergency response equipment
[ ] Refresher training, which is provided at least annually *
[ ] Emergency response drills, which are conducted at least (specify)                   (e.g. "Quarterly", etc.)
</TABLE>

<PAGE>

                                 RECORD KEEPING
                   (HAZARDOUS MATERIALS BUSINESS PLAN MODULE)        Page___of__

All facilities that handle hazardous materials must maintain records associated
with their management. A summary of your recordkeeping procedures is a required
module of the Hazardous Materials Business Plan (HMBP). A blank summary has been
provided below for you to complete and submit if you do not already have such a
document. IF YOU ALREADY HAVE A BRIEF WRITTEN DESCRIPTION OF YOUR HAZARDOUS
MATERIALS RECORDKEEPING SYSTEMS THAT ADDRESSES ALL SUBJECTS COVERED BELOW, YOU
ARE NOT REQUIRED TO COMPLETE THIS PAGE, BUT YOU MUST INCLUDE A COPY OF YOUR
EXISTING DOCUMENT AS PART OF YOUR HMBP.

Check all boxes that apply. The following records are maintained at the
facility. [Note: Items marked with an asterisk (*) are required.]:

[X] Current employees' training records (to be retained until closure of the
    facility) *
[X] Former employees' training records (to be retained at least three years
    after termination of employment) *
[X] Training Program(s) (i.e. written description of introductory and continuing
    training) *
[X] Current copy of this Emergency Response/Contingency Plan *
[X] Record of recordable/reportable hazardous material/waste releases *
[X] Record of hazardous material/waste storage area inspections *
[X] Record of hazardous waste tank daily inspections *
[X] Description and documentation of facility emergency response drills

Note: The above list of records does not necessarily identify every type of
record required to be maintained by the facility.

A COPY OF THE INSPECTION CHECK SHEET(S) OR LOG(S) USED IN CONJUNCTION WITH
REQUIRED ROUTINE SELF-INSPECTIONS OF YOUR FACILITY MUST BE SUBMITTED WITH YOUR
HMBP. (Exception: Available from your local agency is a Hazardous
Materials/Waste Storage Area Inspection Form that you may use if you do not
already have your own form. If you use the example provided, you do not need to
attach a copy.)

Check the appropriate box:
[X] We will use the Unidocs "Hazardous Materials/Waste Storage Area Inspection
    Form" to document inspections.
[ ] We will use our own documents to record inspections. (A BLANK COPY OF EACH
    DOCUMENT USED MUST BE ATTACHED TO THIS HMBP.)

<PAGE>

                                    EXHIBIT E

               ADDENDUM TO STANDARD INDUSTRIAL LEASE (THE "LEASE")
                    DATED THE 18TH DAY OF JULY, 2003 BETWEEN
              THE REALTY ASSOCIATES FUND III, L.P. ("LANDLORD") AND
                         CELERITY GROUP, INC. ("TENANT")

         It is hereby agreed by Landlord and Tenant that the provisions of this
Addendum are a part of the Lease. If there is a conflict between the terms and
conditions of this Addendum and the terms and conditions of the Lease, the terms
and conditions of this Addendum shall control. Capitalized terms In this
Addendum shall have the same meaning as capitalized terms in the Lease.

         1.       Termination of Existing Lease. Tenant presently occupies the
Premises pursuant to an existing lease (the "Existing Lease"). Prior to the
Commencement Date, the Existing Lease shall remain in full force and effect, and
Tenant shall perform all of its obligations under the Existing Lease. Landlord
and Tenant agree that upon the Commencement Date of this Lease, the term of the
Existing Lease will immediately end, and this Lease shall govern Landlord's and
Tenant's rights with respect to the Premises. Tenant shall continue to be
obligated to perform obligations under the Existing Lease that survive its
termination, including, but not limited to, indemnity obligations and
obligations to pay operating expenses and real property taxes.

         2.       Execution of 1507 Lease. Landlord's obligations under this
Lease are contingent and conditioned upon the concurrent execution and delivery
by Tenant and Landlord of a Standard Industrial Lease for the buildings located
at 1507 and 1515 Centre Pointe Drive, Milpitas, California (the "1507 Lease").

         3.       Cross Default. At the sole option of Landlord, any default by
Tenant under the 1507 Lease shall be deemed to be a default under section
17.1(c) of this Lease, and in the event of such a default, Landlord shall have
all of the remedies available to it under this Lease including, but not limited
to, the right to draw down the L/C (as defined below) to cure a default under
the 1507 Lease. This Addendum section 3 shall be of no force or effect from and
after the date that the real property encumbered by the 1507 Lease is no longer
owned by The Realty Associates Fund III, L.P.

         4.       Security Deposit. Pursuant to the Existing Lease, Tenant
provided to Landlord a security deposit in the amount of Eighty Seven Thousand
Five Hundred Seventy Two and 98/100 Dollars ($87,572.98) (the "Existing
Deposit"). Within three (3) days after the last to occur of (a) the Commencement
Date of this Lease, (b) the Commencement Date of the 1507 Lease and (c) the
delivery to Landlord of the L/C, Landlord shall pay the Existing Deposit to
Tenant. Until all of the foregoing events have occurred, Landlord shall have no
obligation to return the Existing Deposit to Tenant.

         5.       Base Rent Credit. Upon delivery of the L/C to Landlord, Tenant
shall receive a credit towards payment of the next due Base Rent under the Lease
in the amount of Twenty One Thousand One Hundred Seventeen and 36/100
($21,117.36).

         6.       Letter of Credit.

                  (a)      Delivery of Letter of Credit. Concurrently with
Tenant's execution and delivery of the Lease, and as a condition to Landlord's
obligations under the Lease, Tenant covenants and agrees to deliver to Landlord
an irrevocable standby letter of credit (the "L/C") in the form of, and upon all
of the terms and conditions contained in, Exhibit "1" attached to this Addendum
and incorporated herein by reference. The L/C shall be issued by an
institutional lender of good financial , standing (which lender shall, in any
event, have assets equal to or exceeding $500,000,000 as of the date of issuance
of the L/C), having a place of business where the L/C can be presented for
payment in California or Texas. The lender shall be subject to Landlord's prior
written approval, not to be unreasonably withheld or delayed. The L/C shall
provide for one (1) or more draws by Landlord or its transferee up to the
aggregate amount of US $187,573.00 (the "L/C Amount") on the terms and
conditions of Exhibit "1".

                  (b)      Renewal of L/C. Tenant shall maintain the L/C in
effect from the date of Tenant's execution of this Lease until the date which is
sixty (60) days after Tenant shall have performed all of its obligations under
the Lease (said period is hereinafter referred to as the "L/C Term"). If the
expiration date of the L/C (or any renewal or replacement L/C provided pursuant
to this Addendum section) occurs prior to the end of the L/C Term, then Tenant
shall deliver to Landlord a renewal of the L/C or a replacement L/C meeting all
of the terms and conditions of this Addendum section, not later than thirty (30)
days prior to the then-applicable expiration date. Each L/C provided pursuant to
this Addendum section shall have an expiration date which is at least one (1)
year from such L/C's date of issue except where the then-applicable expiration
date of the L/C is less than one (1) year from the end of the L/C Term, in which
case the renewal or replacement L/C shall be for such lesser period. The issuing
bank's agreement to place an automatic renewal provision in the L/C, as required
pursuant to said Exhibit "1", shall not relieve or release Tenant from its
obligation to provide a renewal or replacement L/C on the terms hereinabove
stated, it being understood that any such automatic renewal is an independent
obligation of the issuing bank which is intended for Landlord's sole benefit. If
Tenant fails to provide the renewal or replacement L/C not later than thirty
(30) days prior to the then-applicable, stated expiration date (excluding
automatic renewal provisions), such failure shall be a default by Tenant, and
Landlord shall have the right, without notice or demand, on one or more
occasions, to draw upon all or any part of the remaining proceeds of the L/C.

                  (c)      Draw on Letter of Credit. Landlord may elect from
time to time, in Landlord's sole discretion, without notice or demand to Tenant,
to draw upon all or any part of the remaining proceeds of the L/C (as
appropriate) upon the occurrence of one or more of the following events: (i) if
Tenant is in bankruptcy, the failure of Tenant to perform any of its obligations
under the Lease (including, but not limited to, its obligations under this
Addendum section), whether or not such failure constitutes a default by Tenant
as defined In the Lease, or (ii) if Tenant is not in bankruptcy, the occurrence
of a default (as defined is section 17.1 of the Lease), after any applicable
notice and cure period, or (iii) Tenant makes any assignment for the benefit of
creditors, Tenant declares bankruptcy or is the subject of an involuntary
bankruptcy proceeding, a trustee or receiver is appointed to take possession of
some or all of Tenant's assets or, in Landlord's reasonable judgment, Tenant is
insolvent (the foregoing clauses (i), (ii) and (iii) are collectively referred
to as "Authorized Draws"). Each Authorized Draw shall be limited to such amount
as is reasonably necessary (in Landlord's discretion) to satisfy the Authorized
Purposes set forth in Section 6(d) below. . If Landlord does draw down the L/C
pursuant to (i) or (iii) above, Landlord shall thereafter promptly give Tenant
written notice that it has drawn down on the L/C, and such notice shall include
the reasons for such draw.

                  (d)      Application of L/C Proceeds. Landlord may elect, from
time to time, upon written notice to Tenant, in Landlord's sole discretion, to
apply the proceeds it receives from a draw on the L/C for the following limited
purposes: (i) to remedy Tenant's failure to perform any of its obligations under
the Lease, (ii) to compensate Landlord for damages Landlord incurs as a result
of Tenant's failure to perform Its obligations under the Lease and/or (iii) In
any other manner permitted by the Lease or applicable law (the foregoing clauses
(i), (ii) and (iii) are collectively referred to as "Authorized Purposes").
Landlord may make one or more partial draws under the L/C and shall have the
right, upon written notice to Tenant, to treat each draw or a portion thereof in
one or more of the ways described in the previous sentence.

<PAGE>

                  (e)      Enforcement. Tenant's obligation to furnish the L/C
shall not be released, modified or affected by any failure or delay on the part
of Landlord to enforce or assert any of its rights or remedies under the Lease
or this Addendum section, whether pursuant to the terms thereof or at law or in
equity. Landlord's right to draw upon the L/C shall be without prejudice or
limitation to Landlord's right to draw upon any security deposit provided by
Tenant to Landlord or to avail itself of any other rights or remedies available
to Landlord under the Lease or at law or equity.

                  (f)      Event of Default. Tenant's failure to perform its
obligations under this Addendum section (time being of the essence) shall
constitute an event of default under the Lease, and shall entitle Landlord to
immediately exercise all of Its rights and remedies under the Lease (including,
but not limited to rights and remedies under this Addendum section) or at law or
in equity without notice or demand to Tenant.

                  (g)      Conflict. If there is any conflict between the terms
and conditions of this Addendum section and the terms and conditions of the
Lease, the terms of this Addendum section shall control.

         7.       Guaranty of Lease. Landlord's obligations under this Lease are
conditioned and contingent upon its receipt concurrently with Tenant's execution
and delivery of this Lease of a fully executed original of the Guaranty of Lease
attached to this Lease as Exhibit F.

         8.       Lender Approval. Landlord has obtained a loan (the "Loan")
from a lender (the "Lender") the repayment of which is secured by the Premises.
Tenant acknowledges that the terms and conditions of the Lease must be reviewed
and approved by the Lender. Landlord makes no representation or warranty to
Tenant that the Lender will approve the Lease. Landlord's obligations under the
Lease are contingent and conditioned upon the Lender's approval of the Lease.

         9.       Abatement of Rent Due to Loss of Use of Premises. In the event
that Tenant is prevented from using, and does not use, the Premises or any
portion thereof, for five (5) consecutive business days or ten (10) days in any
twelve (12) month period (the "Eligibility Period") as a result of any damage or
destruction to the Premises or any repair, maintenance or alteration performed
by Landlord to the Premises after the Commencement Date and required by the
Lease, which substantially interferes with Tenant's use of the Premises, or any
failure to provide services or access to the Premises due to Landlord's
negligence or default, then Tenant's rent shall be abated or reduced, as the
case may be, after expiration of the Eligibility Period for such time that
Tenant continues to be so prevented from using, and does not use, the Premises
or a portion thereof, in the proportion that the rentable area of the portion of
the Premises that Tenant is prevented from using, and does not use, bears to the
total rentable area of the Premises. However, in the event that Tenant is
prevented from conducting, and does not conduct, its business in any portion of
the Premises for a period of time in excess of the Eligibility Period, and the
remaining portion of the Premises is not sufficient to allow Tenant to
effectively conduct its business therein, and if Tenant does not conduct its
business from such remaining portion, then for such time after expiration of the
Eligibility Period during which Tenant is so prevented from effectively
conducting its business therein, the rent for the entire Premises shall be
abated: provided, however, if Tenant reoccupies and conducts its business from
any portion of the Premises during such period, the rent allocable to such
reoccupied portion, based on the proportion that the rentable area of such
reoccupied portion of the Premises bears to the total rentable area of the
Premises, shall be payable by Tenant from the date such business operations
commence.

         10.      Option to Extend. Landlord hereby grants to Tenant the option
to extend the term of the Lease for one (1) five (5)-year period (the "Extension
Option") commencing when the initial lease term expires upon each and all of the
following terms and conditions:

                  (a)      Tenant shall give to Landlord on a date which is
prior to the date that the option period would commence (If exercised) by at
least one hundred eighty (180) days and not more than two hundred seventy (270)
days, a written notice of the exercise of the option to extend the Lease for
said additional term, time being of the essence. if said notification of the
exercise of said option is not so given and received, this option shall
automatically expire.

                  (b)      All of the terms and conditions of the Lease except
where specifically modified by this section shall apply.

                  (c)      The monthly Base Rent payable during the option term
shall be the Market Rate on the date the option term commences.

                  (d)      The term "Market Rate" shall mean the annual amount
per rentable square foot that a willing, comparable renewal tenant would pay and
a willing, comparable landlord of a similar building would accept at arm's
length for similar space, giving appropriate consideration to the following
matters: (i) annual rental rates per rentable square foot; (ii) the type of
escalation clauses (including, but without limitation, operating expense, real
estate taxes, and CPI) and the extent of liability under the escalation clauses
(i.e. whether determined on a "net lease" basis or by increases over a
particular base year or base dollar amount); (iii) rent abatement provisions
reflecting free rent and/or no rent during the lease term; (iv) length of lease
term; (v) size and location of premises being leased; and (vi) other generally
applicable terms and conditions of tenancy for similar space; provided, however,
Tenant shall not be entitled to any tenant improvement or refurbishment
allowance. The Market Rate may also designate periodic rental increases, a new
Base Year and similar economic adjustments. The Market Rate shall be the Market
Rate in effect as of the beginning of the option period, even though the
determination may be made in advance of that date, and the parties may use
recent trends in rental rates in determining the proper Market Rate as of the
beginning of the option period.

                  (e)      If Tenant exercises the Extension Option, Landlord
shall determine the Market Rate by using its good faith judgment. Landlord shall
provide Tenant with written notice of such amount within fifteen (15) days after
Tenant exercises its Extension Option. Tenant shall have fifteen (15) days
("Tenant's Review Period") after receipt of Landlord's notice of the new rental
within which to accept such rental. In the event Tenant fails to accept in
writing such rental proposal by Landlord, then such proposal shall be deemed
rejected, and Landlord and Tenant shall attempt to agree upon such Market Rate,
using their best good faith efforts. If Landlord and Tenant fall to reach
agreement within fifteen (15) days following Tenant's Review Period ("Outside
Agreement Date"), then each party shall place in a separate sealed envelope
their final proposal as to the Market Rate, and such determination shall be
submitted to arbitration in accordance with subsections (i) through (v) below.
In the event that Landlord falls to timely generate the initial notice of
Landlord's opinion of the Market Rate, then Tenant may commence such
negotiations by providing the initial notice, in which event Landlord shall have
fifteen (15) days ("Landlord's Review Period") after receipt of Tenant's notice
of the new rental within which to accept such rental. In the event Landlord
fails to accept in writing such rental proposed by Tenant, then such proposal
shall be deemed rejected, and Landlord and Tenant shall attempt in good faith to
agree upon such Market Rate, using their best good faith efforts. If Landlord
and Tenant fail to reach agreement within fifteen (15) days following Landlord's
Review Period (which shall be, in such event, the "Outside Agreement Date" in
lieu of the above definition of such date), then each party shall place in a
separate sealed envelope their final proposal as to Market Rate, and such
determination shall be submitted to arbitration in accordance with subsections
(i) through (v) below.

<PAGE>

                             ARBITRATION OF DISPUTES

                           (i)      LANDLORD AND TENANT SHALL MEET WITH EACH
OTHER WITHIN FIVE (5) BUSINESS DAYS AFTER THE OUTSIDE AGREEMENT DATE AND
EXCHANGE THEIR SEALED ENVELOPES AND THEN OPEN SUCH ENVELOPES IN EACH OTHER'S
PRESENCE. IF LANDLORD AND TENANT DO NOT MUTUALLY AGREE UPON THE MARKET RATE
WITHIN ONE (1) BUSINESS DAY OF THE EXCHANGE AND OPENING OF ENVELOPES, THEN,
WITHIN TEN (10) BUSINESS DAYS OF THE EXCHANGE AND OPENING OF ENVELOPES, LANDLORD
AND TENANT SHALL AGREE UPON AND JOINTLY APPOINT A SINGLE ARBITRATOR WHO SHALL BY
PROFESSION BE A REAL ESTATE BROKER OR AGENT WHO SHALL HAVE BEEN ACTIVE OVER THE
FIVE (5) YEAR PERIOD ENDING ON THE DATE OF SUCH APPOINTMENT IN THE LEASING OF
COMMERCIAL BUILDINGS SIMILAR TO THE PREMISES IN THE GEOGRAPHICAL AREA OF THE
PREMISES. NEITHER LANDLORD NOR TENANT SHALL CONSULT WITH SUCH BROKER OR AGENT AS
TO HIS OR HER OPINION AS TO THE MARKET RATE PRIOR TO THE APPOINTMENT. THE
DETERMINATION OF THE ARBITRATOR SHALL BE LIMITED SOLELY TO THE ISSUE OF WHETHER
LANDLORD'S OR TENANT'S SUBMITTED MARKET RATE FOR THE PREMISES IS THE CLOSEST TO
THE ACTUAL MARKET RATE FOR THE PREMISES AS DETERMINED BY THE ARBITRATOR, TAKING
INTO ACCOUNT THE REQUIREMENTS FOR DETERMINING MARKET RATE SET FORTH HEREIN. SUCH
ARBITRATOR MAY HOLD SUCH HEARINGS AND REQUIRE SUCH BRIEFS AS THE ARBITRATOR, IN
HIS OR HER SOLE DISCRETION, DETERMINES IS NECESSARY. IN ADDITION, LANDLORD OR
TENANT MAY SUBMIT TO THE ARBITRATOR WITH A COPY TO THE OTHER PARTY WITHIN FIVE
(5) BUSINESS DAYS AFTER THE APPOINTMENT OF THE ARBITRATOR ANY MARKET DATA AND
ADDITIONAL INFORMATION SUCH PARTY DEEMS RELEVANT TO THE DETERMINATION OF THE
MARKET RATE ("RR DATA"), AND THE OTHER PARTY MAY SUBMIT A REPLY IN WRITING
WITHIN FIVE (5) BUSINESS DAYS AFTER RECEIPT OF SUCH RR DATA.

                           (ii)     THE ARBITRATOR SHALL, WITHIN THIRTY (30)
DAYS OF HIS OR HER APPOINTMENT, REACH A DECISION AS TO WHETHER THE PARTIES SHALL
USE LANDLORD'S OR TENANT'S SUBMITTED MARKET RATE AND SHALL NOTIFY LANDLORD AND
TENANT OF SUCH DETERMINATION.

                           (iii)    THE DECISION OF THE ARBITRATOR SHALL BE
FINAL AND BINDING UPON LANDLORD AND TENANT.

                           (iv)     IF LANDLORD AND TENANT FAIL TO AGREE UPON
AND APPOINT AN ARBITRATOR, THEN THE APPOINTMENT OF THE ARBITRATOR SHALL BE MADE
BY THE PRESIDING JUDGE OF THE SUPERIOR COURT IN THE COUNTY IN WHICH THE PREMISES
IS LOCATED, OR, IF HE OR SHE REFUSES TO ACT, BY ANY JUDGE HAVING JURISDICTION
OVER THE PARTIES.

                           (V)      THE COST OF THE ARBITRATION SHALL BE PAID BY
LANDLORD AND TENANT EQUALLY.

                  NOTICE: BY INITIALING IN THE SPACE BELOW YOU ARE AGREEING TO
HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION OF
DISPUTES" PROVISION DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW
AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED
IN A COURT OR JURY TRIAL. BY INITIALING IN THE SPACE BELOW YOU ARE GIVING UP
YOUR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS THOSE RIGHTS ARE
SPECIFICALLY INCLUDED IN THE "ARBITRATION OF DISPUTES" PROVISION. IF YOU REFUSE
TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED
TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR
AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.

                  WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT
DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION OF DISPUTES"
PROVISION TO NEUTRAL ARBITRATION.

                        [ILLEGIBLE]                      [ILLEGIBLE]
                       -----------------                ----------------
                      (Landlord Initials)              (Tenant initials)

         11.      Monument Sign. Tenant shall have the right to place its name
on the existing exterior monument sign depicted on Exhibit 2 attached hereto
(the "Sign") upon the following terms and conditions:

                  (a)      The cost to fabricate and Install Tenant's name on
the Sign shall be borne solely by Tenant;

                  (b)      Tenant shall maintain the Sign in good order and
repair, at Tenant's sole expense;

                  (c)      Tenant shall not modify the Sign;

                  (d)      The Sign shall be considered a use of the Premises
pursuant to Addendum section 19 of the Lease, and Tenant shall defend and
indemnify Landlord to the extent provided in Addendum section 19;

                  (e)      Tenant shall remove its name from the Sign and repair
any damage to the Sign, at Tenant's sole cost and expense, upon the expiration
of the Lease term;

                  (f)      Provided Landlord does not materially reduce the
visibility of the Sign, Landlord reserves the right to erect such other signs on
the Project as Landlord, in its sole discretion, deems appropriate;

                  (g)      Should the Sign be electrically illuminated, Tenant
agrees to pay to Landlord, upon demand, the costs of such power attributable to
Tenant's usage as determined by persons skilled in the field, and utilize those
estimates in billing Tenant for the power consumed; however, Tenant shall also
have the right to install, at Tenant's sole cost and expense, electrical meters
which shall measure the actual amount of power consumed; and

                  (h)      During the term of this Lease, Tenant shall have the
exclusive right to use the Sign.

         12.      Parking. At any time upon thirty (30) days advance written
notice to Tenant (the "Notice"), and notwithstanding anything to the contrary
contained in the Lease, Landlord shall have the right to require Tenant to use
the one hundred sixty six (166) parking spaces depicted on Exhibit 3 attached
hereto (the "Reserved Parking Spaces"). If Landlord elects to have Tenant use
the Reserved Parking Spaces, from and after the affective date of the Notice,
(a) Tenant shall be entitled to the exclusive use of the Reserved Spaces and (b)
Tenant shall not be entitled to use any other parking spaces at the Project.

         IN WITNESS WHEREOF, the parties hereto have respectively executed this
Addendum.

         LANDLORD:

<PAGE>

The Realty Associates Fund III, L.P, - Delaware limited partnership

By: Realty Associates Fund III GP Limited Partnership, a Delaware limited
    partnership, its general partner

    By: Realty Associates Fund III LLC, a Delaware limited liability company,
        Its sole general partner

        By: Realty Associates Fund III Trust, a Massachusetts business trust,
            sole Member

            By:  /s/ Scott W. Amling
                 -----------------------------
                 (Officer)

By: Realty Associates Fund III Texas Corporation,
    a Texas corporation, general partner

    By: /s/ Scott W. Amling
        -------------------------------
        (Officer)

TENANT

Celerity Group, Inc., a California corporation

By /s/ John Goodman
   ---------------------------
         (print name)

its: Executive Vice President
     ------------------------------
         (print title)

By: /s/ John R. Ferron
    ---------------------------------
         (print name)

its:              CFO
     ---------------------------------
            (print title)

<PAGE>

                            EXHIBIT "1" to Addendum

                                 [NAME OF BANK]
                      IRREVOCABLE STANDBY LETTER OF CREDIT

Date of Issue:_______________ No.________________

<TABLE>
<CAPTION>
APPLICANT:                                         BENEFICIARY:
<S>                                                <C>
Celerity Group, Inc., a California corporation     The Realty Associates Fund III, L.P.
1463 Centre Pointe Drive                           28 State Street, Tenth Floor
Milpitas, California 95035                           Boston, Massachusetts 02109
</TABLE>

AMOUNT: $187,573.00

At the request and for the account of Celerity Group, Inc., a California
corporation (the "Account Party"), we hereby establish in your favor our
Irrevocable Letter of Credit no.________________in the amount of One Hundred
Eighty Seven Thousand and 00/100 Dollars ($187,573.00).

This Letter of Credit is Issued with respect to that certain lease agreement, by
and between you, as Landlord, and the Account Party, as Tenant. Said lease
agreement, and any amendments or modifications thereof, is hereinafter referred
to as the "Lease." Our obligations under this Letter of Credit are solely as set
forth herein and are completely independent of the obligations of the Account
Party under the Lease. We do not undertake any obligation under the Lease, nor
do we undertake any responsibility to ascertain any facts, or to take any other
action, with respect to the Lease, and we acknowledge that our obligations under
this Letter of Credit shall not be affected by any circumstance, claim or
defense of any party as to the enforceability of the Lease or any dispute as to
the accuracy of the Statement (as defined below). The references to the Lease in
this Letter of Credit are solely to describe the required contents of the
Statement.

Funds under this Letter of Credit are available to you against presentation of
the following documents at our office at ______________________________________
prior to close of business on the expiration date set forth below.

1.       The original of this Letter of Credit.

2.       Your sight draft on us in an amount not exceeding the amount of this
Letter of Credit (less sums previously paid by us hereunder) executed by the
person executing the Statement and bearing the number of this Letter of Credit;
and

3.       A statement (the "Statement") executed by a natural person stating, (a)
that such person is Landlord's duly authorized representative, (b) that Landlord
is entitled to draw under this Letter of Credit in accordance with the terms of
the Lease and (c) requesting a draw under this Letter of Credit.

Facsimile demands are permitted by the delivery to us of facsimile copies of the
documents described in 1 through 3 above. Facsimile demands shall be sent to us
at the following facsimile number:_______________________. If a demand Is made
by facsimile, the original letter of credit is not required.

The expiration date of this Letter of Credit is____________________, provided,
however, that the expiration date of this Letter of Credit shall be
automatically extended, without notice of amendment, for successive one (1) year
periods, unless we give you written notice of our election not to extend the
expiration date ("Notice of Non-Renewal") not later than sixty (60) days prior
to the date this Letter of Credit is scheduled to expire. A Notice of
Non-Renewal shall be effective when actually delivered by certified mall, return
receipt requested, or courier service to your address set forth above or such
other address and/or person as you shall specify to us for such purpose by
written notice received by us prior to the time the Notice of Non-Renewal is
sent.

This Letter of Credit is transferable in its entirety through us. Multiple
transfers shall be permitted. There will be no charge to Beneficiary or any
transferee for the transfer of this Letter of Credit. We will honor complying
drafts presented hereunder by a transferee (and cease to honor drafts presented
hereunder by you) upon our receipt of the fully executed transfer form attached
hereto as Exhibit 1. We will not reduce or curtail any terms or conditions of
this Letter of Credit upon a transfer. Transfers of this Letter of Credit shall
be on the terms of this Letter of Credit as the same may be amendment.

This Letter of Credit may be drawn upon in one or more drafts not exceeding in
the aggregate, the amount available hereunder. Partial draws shall be permitted.

We hereby issue this Letter of Credit in your favor, and we hereby undertake to
honor all drafts drawn under and in compliance with the terms of this Letter of
Credit.

This Letter of Credit shall be governed by and construed in accordance with the
Uniform Customs and Practices for Documentary Credits (___________ Revision)
International Chamber of Commerce Publication 590 and, to the extent not
inconsistent therewith, the laws of the State of California.

________________________________
Authorized Signature

<PAGE>

                          EXHIBIT 1 to Letter of Credit

                    [TRANSFER FORM - to be provided by Bank]

<PAGE>

                                    EXHIBIT 2

                                  (FLOOR PLAN)

<PAGE>

                              EXHIBIT 3 to Addendum

                            (Reserved Parking Spaces)

<PAGE>

                                    Exhibit F

<PAGE>

                                GUARANTY OF LEASE

         This Guaranty of Lease (the "Guaranty") is given by Kinetics Group,
Inc., a Delaware corporation ("Guarantor"), to the Realty Associates Fund III,
L.P., a Delaware limited partnership ("Landlord"), in order to guaranty the
performance of all obligations of Celerity Group, Inc., a California corporation
("Tenant") under that certain lease (the "Lease") entered into by Landlord and
Tenant for the lease of the real property commonly known as 1463 Centre Pointe,
Milpltas, California ("Premises").

         As a material inducement to and in consideration of Landlord's entering
into the Lease, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Guarantor hereby covenants and
agrees with Landlord as follows:

         1.       SCOPE OF GUARANTY. Guarantor hereby unconditionally and
Irrevocably guarantees all of Tenant's obligations under the Lease, provided
that Landlord has given to Tenant such notice(s) and period(s) of cure, if any,
as are required to be given by Landlord to Tenant under the Lease (the
"Obligations") Including but not limited to: (a) Tenant's payment of all rent,
monies and charges payable under the Lease in the manner specified thereunder;
(b) Tenant's performance of each of the covenants contained in the Lease to be
kept, performed or observed by Tenant; and (c) Tenant's payment of all damages
owing to Landlord under the Lease following a default by Tenant under the Lease.
Guarantor acknowledges that this is a guaranty of payment and performance of all
Obligations and not merely a guaranty of collectibility.

         2.       TERM OF GUARANTY. This Guaranty and the obligations of
Guarantor hereunder shall be continuing and Irrevocable until Tenant has
performed all of its Obligations under the Lease, including those which survive
the expiration or earlier termination of the Lease. If all or any portion of the
Obligations are paid or performed, Guarantor's obligations hereunder shall
continue and remain in full force and effect in the event that all or any part
of such payment or performance is avoided or recovered directly or Indirectly
from Landlord as a preference, fraudulent transfer or otherwise. This Guaranty
and the obligations of Guarantor hereunder shall continue during any option
period, extended term or renewal period.

         3.       WAIVERS. Guarantor hereby waives its right to assert any
defense to its liability under this Guaranty based on (a) Guarantor's right to
require Landlord to proceed against Tenant or a co-guarantor or to proceed
against or exhaust any security held by Landlord at any time; (b) any defense
that may arise by reason of the incapacity, lack of authority, death or
disability of any other person or persons or the failure of Landlord to file or
enforce a claim against the estate (in administration, bankruptcy or any other
proceeding) of any other person or persons; (c) any defense based upon an
election of remedies by Landlord, including any election which destroys or
impairs any right of subrogation, reimbursement or contribution which Guarantor
may have; (d) any duty on the part of Landlord to disclose to Guarantor any
facts Landlord may now or hereafter know about Tenant, it being understood and
agreed that Guarantor is fully responsible for becoming and remaining informed
of the financial condition of Tenant and of any and all circumstances bearing on
the risk of nonperformance of any Obligation; (e) any rights or benefits in
favor of Guarantor under Sections 2809, 2810, 2815, 2819, 2839, 2845, 2848, 2849
or 2850 of the California Civil Code or under 11 U.S.C. Sections 364 or 1111
(b), or any amendment to any of the forgoing statutes; (f) any transfer of
Landlord's Interest in the Premises or the assignment of Landlord's interest in
the Lease; (g) any transfer of Tenant's interest as tenant under the Lease or
any portion thereof or any sublease or assignment by Tenant; (h) any merger or
consolidation of Tenant or sale of all or a substantial portion of Tenant's
assets; (i) any sale of all or any portion of any capital stock of Tenant or
partnership interest in Tenant owned by Guarantor; or (j) any prior or
concurrent representation, understanding, promise or condition concerning the
subject matter hereof which is not expressed herein. Guarantor hereby waives all
presentments, protests, notices of protest, notices of dishonor and notices of
acceptance of this Guaranty by Landlord, and this Guaranty shall be binding upon
Guarantor Immediately upon its delivery to Landlord; provided that the foregoing
shall net waive or release any obligation of Landlord to provide notice to
Tenant (or its successors or assigns) and any required period of cure in
accordance with and to the extent required by the Lease.

         4.       NO DISCHARGE OF GUARANTOR. Guarantor's liability under this
Guaranty shall not be deemed to have been waived, released, discharged, limited,
impaired or affected by reason of (a) the expiration or termination of the
Lease; (b) the release or discharge of Tenant in any receivership, bankruptcy or
other creditors' proceedings or the rejection, disaffirmance or disclaimer of
the Lease by any party in any such proceeding; (c) the repossession of the
Premises; or (d) any waiver by Landlord of any provisions of the Lease or any
failure by Landlord to enforce the provisions thereof. Guarantor hereby assigns
to Landlord any rights Guarantor may have to file a claim and proof of claim in
any bankruptcy or

<PAGE>

similar proceeding of Tenant and any awards or payments thereon to which
Guarantor would otherwise be entitled, to the extent of any unsatisfied
Obligation. No amendment or modification of the Lease shall be binding on
Guarantor unless Guarantor has consented to such amendment or modification.
Guarantor shall be deemed to have consented to an amendment or modification of
the Lease if Guarantor does not provide written notice to Landlord and Tenant
objecting to the amendment or modification within three (3) business days after
Landlord or Tenant notifies Guarantor of the proposed amendment or modification
in the manner described in section 16 below.

         5.       CUMULATIVE RIGHTS. The amount of Guarantor's liability and all
rights, powers and remedies of Landlord hereunder shall be cumulative and not
alternative and such rights, powers and remedies shall be in addition to all
rights, powers and remedies available to Landlord at law or in equity. In the
event of any default hereunder, a separate action or actions may be brought and
prosecuted against Guarantor, whether or not Tenant is joined in the action and
whether or not a separate action is brought against Tenant. Landlord may
maintain successive actions for other defaults.

         6.       SUBORDINATION OF RIGHTS. Guarantor hereby subordinates any and
all claims it may have against Tenant to Landlord's claims under the Lease.

         7.       ATTORNEYS' FEES AND EXPENSES. The prevailing party shall pay,
upon demand, reasonable attorneys' fees and all costs and other expenses which
the other party expends or incurs in enforcing or defending against this
Guaranty or which Landlord incurs in connection with any insolvency, bankruptcy,
reorganization, arrangement or other similar proceedings involving Tenant,
Guarantor, or either of them.

         8.       INTEREST. Any amounts payable by Guarantor hereunder that are
not paid when due shall bear interest at the lesser of (a) eight percent (8%)
per annum or (b) the maximum amount permitted by applicable law.

         9.       SEVERABILITY. Should any provision of this Guaranty be
determined to be illegal or unenforceable by a court of competent jurisdiction,
all other provisions hereof shall nevertheless be deemed effective.

         10.      MODIFICATION. No provision of this Guaranty or right of
Landlord hereunder may be modified or waived, nor shall Guarantor be released
from performance of Guarantor's obligations hereunder, except by a writing duly
executed by Landlord.

         11.      ASSIGNMENT AND INTERPRETATION. This Guaranty shall inure to
the benefit of and bind the heirs, legal representatives, administrators,
executors, successors and assigns of Guarantor and of Landlord. The assignment
of the Guaranty by Landlord shall not extinguish or diminish Guarantor's
liability hereunder. The use of the word Guarantor shall include the plural as
well as the singular. Words used in the neuter gender shall include the
masculine and feminine gender.

         12.      EFFECT OF GUARANTOR'S PERFORMANCE OF OBLIGATIONS. The
acceptance by Landlord of the performance of any of the Obligations under the
Lease by Guarantor, including, without limitation, the acceptance of rent
payments, shall constitute neither an assignment of the Lease to Guarantor nor
Landlord's consent to such an assignment.

         13.      ESTOPPEL CERTIFICATE. Guarantor, from time to time within ten
(10) business days following Landlord's written request, shall execute and
deliver to Landlord an estoppel certificate containing such truthful Information
as Landlord may reasonably request, and such further instruments or
documentation as may reasonably be requested by Landlord to ratify and confirm
this Guaranty and the continuing liability of Guarantor hereunder. In addition,
at Landlord's request, from time to time, Guarantor shall furnish to Landlord
its most recent audited financial statement.

         14.      GOVERNING LAW AND VENUE. This Guaranty shall be governed by
and construed in accordance with the laws of the State of California (without
regard to California's conflicts of law rules). The parties hereby consent to
jurisdiction and venue in any California court of competent jurisdiction or the
United States District Court for the county and federal judicial district,
respectively, in which the Premises are located, and agree that such courts
shall constitute the exclusive venue for any dispute arising hereunder.

<PAGE>

         15.      ENTIRE AGREEMENT. This Guaranty contains all of the agreements
of Landlord and Guarantor concerning the guaranty of the Lease and no prior or
contemporaneous agreement or understanding pertaining to any such matter shall
be effective.

         16.      NOTICES. Any notice given hereunder shall be in writing and
may be given by certified mail, return receipt requested, personal delivery,
Federal Express or other delivery service. If notice is given by certified mail,
return receipt requested, notice shall be deemed given three (3) days after the
notice has been deposited in the U.S. mail, postage pre-paid, addressed to
Guarantor at the address set forth opposite its signature on the last page of
this Guaranty and addressed to Landlord at the address for notices for Landlord
set forth in the Lease. If notice is given by personal delivery, Federal Express
or other delivery service, notice shall be deemed given on the date the notice
is actually received by Landlord or Guarantor. Either party may, by written
notice to the other party, specify a different address for notice purposes.

         17.      AUTHORITY. If Guarantor is a corporation, trust, or general or
limited partnership, Guarantor, and each individual executing this Guaranty on
behalf of such entity, represents and warrants that such Individual is duly
authorized to execute and deliver this Guaranty on behalf of said entity, that
said entity is duly authorized to enter into this Guaranty, and that this
Guaranty is enforceable against said entity in accordance with its terms. If
Guarantor is a corporation, trust or partnership, Guarantor shall deliver to
Landlord upon demand evidence of such authority satisfactory to Landlord.

         18.      JOINT AND SEVERAL LIABILITY. If more than one person or entity
executes this Guaranty, the obligations of each person or entity executing this
Guaranty shall be Joint and several.

         19.      WAIVER OF JURY TRIAL. LANDLORD AND GUARANTOR HEREBY WAIVE
THEIR RESPECTIVE RIGHT TO TRIAL BY JURY OF ANY CAUSE OF ACTION, CLAIM,
COUNTERCLAIM OR CROSS-COMPLAINT IN ANY ACTION, PROCEEDING AND/OR HEARING BROUGHT
BY EITHER LANDLORD AGAINST GUARANTOR OR GUARANTOR AGAINST LANDLORD ON ANY MATTER
WHATSOEVER ARISING OUT OF, OR IN ANY WAY CONNECTED WITH, THIS GUARANTY, THE
LEASE, THE RELATIONSHIP OF LANDLORD AND GUARANTOR, TENANT'S USE OR OCCUPANCY OF
THE PREMISES, OR ANY CLAIM OF INJURY OR DAMAGE, OR THE ENFORCEMENT OF ANY REMEDY
UNDER ANY LAW, STATUTE, OH REGULATION, EMERGENCY OR OTHERWISE, NOW OR HEREAFTER
IN EFFECT.

         GUARANTOR ACKNOWLEDGES THAT IT WAS AFFORDED THE OPPORTUNITY TO READ
THIS GUARANTY AND TO REVIEW IT WITH AN ATTORNEY OF ITS CHOICE. GUARANTOR
ACKNOWLEDGES HAVING READ AND UNDERSTOOD THIS GUARANTY AND THE LEASE BEFORE
SIGNING THIS GUARANTY.

         IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the date
written below.

         DATED:__________________              GUARANTOR:

                                               Kinetics Group, Inc, a Delaware
                                               corporation

ADDRESS OF GUARANTOR:

Kinetics Group, Inc., a Delaware corporation   By: /s/ John Goodman
2805 Mission College Boulevard                    ------------------------------
Santa Clara, California 95054                     John Goodman
Attention: John Goodman, General Counsel                   (print name)

                                               Its: Executive Vice President
                                                    ----------------------------
                                                           (print name)

                                               By: /s/ John R. Ferron
                                                  ------------------------------
                                                  John R. Ferron
                                                           (print title)

                                               Its: CFO
                                                    ----------------------------
                                                           (print title)

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