Document:

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                                                                   Exhibit 10.16

                                COMMERCIAL LEASE

                              COLORADO TECH CENTER
                              1722 BOXELDER STREET
                              LOUISVILLE, COLORADO

                         LANDLORD: THE MILLS FAMILY, LLC

                           TENANT: McDATA Corporation

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                                Table of Contents

TABLE OF CONTENTS..............................................................

1.    CERTAIN LEASE PROVISIONS.................................................

2.    PREMISES.................................................................
      2.1    Definition........................................................
      2.2    Public Areas......................................................

3.    TERM.....................................................................
      3.1    Term..............................................................
      3.2    Delay in Commencement.............................................
      3.3    Early Possession..................................................
      3.4    Delivery of Possession............................................
      3.5    Holding Over......................................................

4.    RENT.....................................................................
      4.1    Base Rent.........................................................
      4.2    Additional Rent...................................................
      4.3    Parking and Storage...............................................
      4.4    Acceptance of Rental Payments.....................................

5.    ESCALATIONS OF RENT......................................................
      5.1    Determination.....................................................
      5.2    Operating Expenses ...............................................

6.    SHARED EXPENSES..........................................................
      6.1    Determination.....................................................
      6.2    Escalations.......................................................
      6.3    Statements .......................................................

7.    SECURITY DEPOSIT ........................................................

8.    USE......................................................................
      8.1    Use...............................................................
      8.2    Compliance with Law...............................................
      8.3    Waste and Nuisance................................................
      8.4    Conditions of Premises............................................
      8.5    Insurance Cancellation............................................
      8.6    Landlord's Rules and Regulations..................................

9.    LANDLORD'S SERVICES .....................................................
      9.1    Basic Services ...................................................
      9.2    Initial Construction .............................................
      9.3    Interruption of Service...........................................

10.   MAINTENANCE, REPAIRS AND ALTERATIONS.....................................
      10.1   Landlord's Obligations............................................
      10.2   Tenant's Obligations..............................................
      10.3   Surrender.........................................................
      10.4   Alterations and Additions.........................................

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11.   TENANT'S USE OF PUBLIC AREAS ............................................

12.   TAXES AND TELEPHONE......................................................
      12.1   Personal Property Taxes ..........................................
      12.2   Evidence of Payment ..............................................
      12.3   Telephone and Communication Systems ..............................

13.   INSURANCE AND INDEMNITY..................................................
      13.1   Liability Insurance...............................................
      13.2   Property Insurance................................................
      13.3   Insurance Policies................................................
      13.4   Waiver of Subrogation.............................................
      13.5   Hold Harmless.....................................................
      13.6   Exemption of Landlord from Liability..............................

14.   DAMAGE OR DESTRUCTION....................................................
      14.1   Option to Terminate Lease.........................................
      14.2   Obligation to Repair or Restore...................................
      14.3   Fault of Tenant ..................................................
      14.4   Obligations of Tenant.............................................
      14.5   Termination by Tenant.............................................

15.   CONDEMNATION.............................................................

16.   ASSIGNMENT AND SUBLETTING................................................
      16.1   Landlord's Consent Required ......................................
      16.2   No Release of Tenant .............................................
      16.3   Attorneys Fees and Administrative Fees ...........................
      16.4   Right to Collect Rent ............................................

17.   DEFAULTS; REMEDIES.......................................................
      17.1   Defaults..........................................................
      17.2   Remedies in Default...............................................
      17.3   Default by Landlord...............................................
      17.4   Late Changes......................................................

18.   RIGHTS OF MORTGAGEES.....................................................
      18.1   Subordination.....................................................
      18.2   Mortgagee's Consent to Amendments.................................
      18.3   Mortgagee's Right to Cure.........................................

19.   NOTICES..................................................................

20.   RELOCATION...............................................................

21.   QUIET POSSESSION.........................................................

22.   RENEWAL OPTIONS..........................................................

23.   LANDLORD'S LIEN..........................................................

24.   HAZARDOUS MATERIALS......................................................

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25.   GENERAL PROVISIONS.......................................................
      25.1   Estoppel Certificate..............................................
      25.2   Landlord's Interests and Liability................................
      25.3   Severability......................................................
      25.4   Interest on Past Due Obligations; Certified Funds.................
      25.5   Time of the Essence...............................................
      25.6   Captions..........................................................
      25.7   Entire Agreement..................................................
      25.8   Waivers...........................................................
      25.9   Recording.........................................................
      25.10  Determinations by Landlord........................................
      25.11  Cumulative Remedies...............................................
      25.12  Covenants and Conditions..........................................
      25.13  Binding Effect; Choice of Law; Personal Jurisdiction..............
      25.14  Attorneys Fees....................................................
      25.15  Landlord's Access.................................................
      25.16  Auctions..........................................................
      25.17  Merger............................................................
      25.18  Corporate Authority...............................................
      25.19  Signs.............................................................
      25.20  Brokers...........................................................
      25.21  Guarantor.........................................................
      25.22  Governing Law.....................................................
      25.23  Joint and Several Liability.......................................
      25.24  No Joint Venture..................................................
      25.25  Additional Transaction Specific Terms.............................

EXHIBITS
      Exhibit A   Legal Description
      Exhibit B   Premises Site Plan
      Exhibit C   Guaranty of Lease
      Exhibit D   Dock Modifications
      Exhibit E   Core and Self Specifications
      Exhibit F   Estimated Operating Expense Budget 2000

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                                COMMERCIAL LEASE

         This Lease, dated for reference purposes only November 2, 1999, is made
by and between The Mills Family, LLC ("Landlord"), and McDATA Corporation,
("Tenant").

1.       CERTAIN PROVISIONS

         The description and amounts set forth below are qualified by their
usage elsewhere in this Lease, including those Sections referred to in
parentheses following such descriptions;

1.1      Tenant's address and telephone number. (Section 19):

              Tenant Name:     McDATA Corporation, a Delaware Corporation
                               registered to do business in Colorado,
                               Doing Business As (DBA):

              McDATA Corporation
              Address: 310 Interlocken Parkway Broomfield, CO 80021
              Telephone: (303) 460-9200

1.2      Premises. (Section 2.1):
         Building Name:        McDATA Building
                               Address: 1722 Boxelder Street,
                               Louisville, CO

1.3      Leased Area. (Section 2. 1): 91,497 sq. ft.

1.4      Total Building Area. (Section 2.1): 91,497 Gross sq. ft.

1.5      Tenant's Pro-Rata Share of Building Area. (Section 2.1): 100%

1.6      Lease Term. (Section 3.1): 36 months (3) years

1.7      Commencement Date. (Section 3.1 and 3.2): Fifteen days after Tenant is
         notified of Delivery of Possession (based on issuance of temporary
         certificate of occupancy), estimated to be February 15, 2000 (It being
         understood that Tenant receives 15 days of free rent from the date of
         notification of Delivery of Possession)

1.8      Expiration Date. (Section 3.1, 3.2): February 14, 2003. With 2 one year
         options to extend beyond February 14, 2003

1.9      Base Rent for Lease Term. (Section 4. 1): Total $2,999,271.66

1.10     Base Rent, Monthly Installments. (Sections 4.1, 5.2):
         $80,059.88/month (Year 1)

1.11     (a) Address of Landlord for rent payments (Sections 4.1, 4.2):
                  The Mills Family Limited Liability Company
                  PMB 234,4800 Baseline Road, E-104, Boulder, CO 80303

         (b) Address of Landlord for notices.  (Sections 6.3, 19):
                  The Mills Family Limited Liability Company
                  PMB 234,4800 Baseline Road, E-104, Boulder, CO 80303
                        with copy to: J. Marcus Painter, Caplan & Earnest LLC
                        2595 Canyon Boulevard, Suite 400, Boulder, CO 80302-6737

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         (c) Address of Tenant for notices (Section 6.3, 19):
                  McDATA Corporation, Dee Perry CFO
                  310 Interlocken Parkway, Broomfield, CO 80021
                        with copy to: EMC Corporation, General Counsel
                        35 Parkwood Drive, Hopkinton, MA 01748-1659
                        with copy to: McBride and Company, LLC
                        Attn: Alice McBride, 3801 E. Florida, Suite 206,
                              Denver, CO 80210

1.12    Base Rent Escalator. (Section 5.2):         Four Percent (4%) per Year

1.13    Base Rent By Year. (Section 5.2):           Year One $10.50/sq. ft.
                                                    Year Two $10.92/sq. ft.
                                                    Year Three $11.36/sq. ft.

1.14     Landlord's Share of Operating Expenses. During construction warranty
         period, Landlord will be responsible for those items covered by the
         building contractor's warranty.

1.15     Landlord's Share of Real Estate Taxes: None, except Landlord shall
         be responsible for all such taxes based on the period prior to
         commencement of lease.

1.16     Security Deposit. (Section 7): None; provided however, first full
         month's rent of $80,059.88 and estimated first full month's operating
         expenses of $11,360.88 shall be due upon lease signing.

1.17     Use. (Section 8. 1): Assembly, testing and distribution of product
         together with research and development and associated administrative
         uses and general office use.

1.18     Brokers. (Section 25.20): Listing Broker: Colorado Group, Inc., 3434
         47th Street, Suite 220, Boulder, CO 80301; Cooperating Broker: McBride
         and Company, LLC, 3801 East Florida Avenue, Suite 206, Denver, CO
         80210

1.19     Addendum(s). (Sections 3.2, 4.3, 9.2): The following addendum(s) are
         attached to this Lease: (1) Commencement Date and Expiration Date
         Addendum, (2) Recorded Covenants, (3) Work Letter Addendum (4)
         Additional Tenant Improvement Allowance

This Lease consists of 25 articles on 30 pages, plus Exhibits A, B, C, D, E, and
F, and 4 Addendum(s).

LANDLORD:                                          TENANT:
The Mills Family Limited Liability Company         McDATA Corporation

BY: ______________________________________         BY: _________________________

DATE: ____________________________________         DATE: _______________________

2.       PREMISES

         2.1      DEFINITIONS. Landlord hereby leases to Tenant and Tenant
leases from Landlord for the term, at the rental, and upon all of the conditions
set forth herein, that certain real property known by the address specified in
Section 1.2 hereof, consisting of the approximate amount of rentable square feet
specified in Section 1.3 hereof, and which is referred to herein as the
Premises. The Premises are located in a building presently consisting of the
total number of rentable square feet specified in Section 1.4 hereof, which
building, the real property on which it is situated (the legal description of
which is attached hereto as Exhibit A), and any parking facilities or structures
appurtenant thereto are hereinafter collectively referred to as the "Building."
The Premises are depicted in Exhibit B attached hereto and incorporated herein
by this reference, but the depiction of possible uses, tenants or locations on
Exhibit B shall not be construed to be a warranty or representation by Landlord
that any such uses, tenants or locations presently exist or will continue to
exist. Tenant's share of the total amount of square feet of the Building is
equal to the pro-rata share specified in Section 1.5 hereof, and said percentage
shall hereinafter be referred to as the Tenant's "Pro-Rata Share."

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         2.2      PUBLIC AREAS. As long as this Lease remains in effect and
Tenant is not in default hereunder, Tenant shall have the nonexclusive right, to
use the public areas of the Building, if any.

3.       TERM

         3.1      TERM. The term of this Lease shall be the term specified in
Section 1.6 hereof, commencing on the Commencement Date specified in Section 1.7
hereof and ending on the Expiration Date specified in Section 1.8 hereof unless
sooner terminated pursuant to any provision of this Lease.

         3.2      DELAY IN COMMENCEMENT. Notwithstanding said Commencement Date,
if for any reason Landlord cannot deliver possession of the Premises to Tenant
on said date, Landlord shall not be subject to any liability therefor, nor shall
such failure affect the validity of this Lease or the obligations of Tenant
hereunder. However, in such case Tenant shall not be obligated to pay rent until
possession of the Premises is tendered to Tenant, which date shall be the new
Commencement Date, and the Expiration Date shall be thirty-six (36) months after
the new Commencement Date. In the event the Tenant is not notified of Delivery
of Possession on or before February 15, 2000, the Commencement Date shall be
delayed to April 1, 2000, provided the Landlord has a temporary Certificate of
Occupancy and further provided that the Landlord has notified the Tenant of
Delivery of Possession. Notwithstanding the foregoing, if the Tenant is informed
of Delivery of Possession after February 15, 2000 and on or before March 15,
2000, while the Commencement Date shall be delayed to April 1, 2000, the Tenant
shall not be entitled to the fifteen (15) days of free rent as provided by
Section 1.7. In the event the Tenant is notified of Delivery of Possession after
March 15, 2000 and before April 1, 2000, while the Commencement Date shall be
fifteen (15) days after Tenant is notified of Delivery of Possession, the Tenant
shall be entitled to free rent, not to exceed fifteen (15) days, for the number
of days from March 16, 2000 to the date the Tenant is notified of Delivery of
Possession. Upon Landlord's request, the parties agree to execute in writing an
Addendum to certify the Commencement Date and Expiration Date hereof, but this
Lease shall not be affected in any manner if either party fails or refuses to
execute such Addendum. In the event Landlord fails to deliver possession by May
1, 2000, Tenant may terminate this Lease and all further obligations of the
parties to one another hereunder shall be void, and Tenant shall be entitled to
a refund of all costs incurred and paid by the Tenant for Tenant Finish in
excess of costs paid by the Landlord under the Tenant Finish Allowance;
provided, however, so long as Landlord has proceeded in good faith and with due
diligence to prosecute completion of all work reasonably necessary for occupancy
by Tenant, such May 1, 2000 date shall be extended a reasonable period of time
due to: labor or material shortages, labor disputes, fire, weather, unusual
delays in transportation, unavoidable casualties, any act or negligence of
Tenant, any delay in provision of requisite plans or documents from Tenant, any
changes ordered by Tenant, or any other causes beyond the reasonable control of
Landlord.

         Tenant agrees to supply all Space Plans and Tenant Finish
Specifications where directed by Tenant to Landlord and Landlord's contractor by
November 1, 1999. In the event the Space Plans and Specifications are not
submitted by such date, then rent shall begin to accrue hereunder not later than
April 1, 2000.

         It is the intent hereof that both Landlord and Tenant proceed
diligently and without unreasonable delay to complete construction of the
Property and to prepare it for occupancy at the earliest reasonable time.

         3.3      EARLY POSSESSION. In the event that Landlord shall permit
Tenant to occupy the Premises prior to the Commencement Date, for the purposes
of completing alterations to the Premises, such occupancy shall be subject to
all of the provisions of this Lease except Tenant shall not be obligated to pay
rental or any other charges incurred under this Lease. However, if Tenant
commences business operations in any part of the Leased Premises prior to the
scheduled Commencement of the Lease Term, the Lease Term shall Commence 15 days
after commencement of business operations. Said early possession shall not
advance the Expiration Date of this Lease.

         3.4      DELIVERY OF POSSESSION. Tenant shall be deemed to have taken
possession of the Premises when the earliest of any of the following occur: (a)
fifteen (15) calendar days after Landlord or Landlord's agent, architect or
contractor notifies Tenant that the Premises are ready for occupancy (pursuant
to the issuance of a Temporary Certificate of Occupancy or the equivalent
thereof); or (b) fifteen (15) days after Tenant commences business operations.
Except as set forth in Section 3.2, if Tenant is notified pursuant to Section
3.4, Tenant agrees to occupy the Premises within thirty (30) days thereafter.
Tenant agrees that, upon the request of Landlord, Tenant will execute a document
certifying the date on which Tenant took possession of the Premises.

         3.5      HOLDING OVER. If Tenant remains in possession of the Premises
or any part thereof after the expiration of the term or any

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approved extensions hereof, such occupancy shall be a tenancy from month to
month at a monthly rental equal to 125% of the Additional Rent payable
hereunder. The foregoing provisions of this Section 3.5 shall neither be
construed to give the Tenant any right to remain in possession of the Premises
or any part thereof after the expiration of the term hereof nor to waive any of
the Landlord's rights under this Lease to collect any damages to which it may be
entitled, whether direct or consequential.

4.       RENT

         4.1      BASE RENT. The Base Rent for the Premises for the entire term
of this Lease shall be as specified in Section 1.9, subject to adjustment
pursuant to the application of Section 3.2 relative to postponement of the
installments specified in Section 1.10, in advance, on the first day of each
month of the term hereof. Tenant shall pay Landlord upon the execution of this
Lease the sum specified in Section 1.10 as the installment of Base Rent for the
first full calendar month of the term of the Lease. Provided, however, that if
the Commencement Date does not occur on the first day of a month, the aforesaid
payment shall be for the initial thirty days of the Lease and the next monthly
installment of Base Rent shall be due on the first day of the first full
calendar month of the term but shall be prorated to cover only those days of
said calendar month not previously paid by the Tenant by its initial payment.
Base Rent for any period during the term hereof which is less than one calendar
month shall be a pro rata portion of the monthly installment based upon the
actual number of days the Lease is in effect during said calendar month. All
rents shall be payable in lawful money of the United States of America without
notice and without any deductions, offset or abatement, and shall be payable to
Landlord at the address stated in Section 1.11(a) or to such other person or at
such other places as Landlord may designate in writing. The payment of Base Rent
hereunder shall be an independent covenant.

         4.2      ADDITIONAL RENT. Both Tenant and Landlord expressly understand
and agree that all other sums, excepting Base Rent as described in Sections 4.1
and 5, which may from time to time become due under this Lease shall be deemed
Additional Rent. Additional Rent shall include, but not be limited to, late
charges, interest, Shared Expenses as described in Section 6, attorneys' fees,
security deposits and any cash bonds which may by circumstance be required to be
posted hereunder. Both Tenant and Landlord expressly understand and agree that
all monies paid by Tenant hereunder shall be first credited to Additional Rent
(and allocated among different items of Additional Rent as Landlord may
determine), and only then to Base Rent. All payments of Additional Rent shall be
in lawful money of the United States of America, shall be paid without notice
and without any deductions, offsets or abatement, and shall be payable to
Landlord at the address stated in Section 1.11(a) (except for Additional Rent
either paid directly by the Tenant pursuant to Section 25.25(g)), or to such
other persons or at such other places as Landlord may designate in writing. The
obligation to make payments of Additional Rent hereunder shall be an independent
covenant.

         4.3      PARKING AND STORAGE. Tenant shall have full use of the parking
areas for the Property at no additional cost to Tenant. Storage Space on or
about the Property shall be subject to City of Louisville ordinances and any
restrictions set forth in the recorded covenants for the Colorado Technology
Center or any Rules and Regulations adopted by Landlord.

         4.4      ACCEPTANCE OF RENTAL PAYMENTS. No acceptance by Landlord of a
lesser sum than the Base Rent and/or Additional Rent then due shall be deemed to
be other than on account of the earliest amount of such rental due (unless
Landlord elects otherwise), nor shall any endorsement or statement on any check
or any letter accompanying any check or payment as rent be deemed an accord and
satisfaction or compromise and settlement, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the balance of such
payments due or to pursue any other remedy as provided in this Lease.

5.       ESCALATIONS OF RENT.

         5.1      DETERMINATION. The monthly obligations for rental payments
described in Sections 4.1 shall be increased annually in accordance with the
provisions of Section 5.2 below.

         5.2      ANNUAL ESCALATOR. On each anniversary date of the Lease,
beginning on the first anniversary date after the Commencement Date, the Base
Rent shall be increased by four percent (4%) over the previous year's base rent.
Accordingly rent for the initial three (3) year term of the Lease shall be as
follows:

                 Year One         $10.50 per square foot
                 Year Two         $10.92 per square foot
                 Year Three       $11.36 per square foot

6.       SHARED EXPENSES

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         6.1      DETERMINATION. The monthly obligations for Additional Rent as
described in Section 4.2 shall be annually adjusted in accordance with the
provisions of Section 6.2 below.

         6.2      OPERATING EXPENSES.

         (a)      The term "Operating Expense" means the total amounts paid or
payable, whether by the Landlord or otherwise on behalf of the Landlord, in
connection with the management, maintenance, repair and operation of the
Building, other than (i) the roof; (ii) structural elements of the building;
(iii) the capital replacement and maintenance of exterior water, sewer, fire
connection and utility connection lines up to the point of penetration of the
exterior of the building structure, including fiber conduit (but not fiber
cabling); and those expenses described in Section 6.2(b). Operating Expense
shall include, without limiting the generality of the foregoing, to the extent
not paid directly by Tenant, the aggregate of the amount paid for heating, air
conditioning, and providing electricity and water and sewer to the Building, the
amount paid to any persons or entities for all labor and/or wages (including the
cost to Landlord of workmen's compensation and disability insurance, payroll
taxes, welfare and fringe benefits), for services rendered, and materials
provided to the Building; fees for management, inspection and consulting
services pertaining to the Building; and the amount paid for premiums for all
insurance procured by Landlord to insure the Building as may be required or
permitted under this Lease (including, without limitation, loss of rents
insurance, and if there is a mortgage or deed of trust on the Building, such
insurance as may be required by the holder of such mortgage or deed of trust).
Notwithstanding the foregoing, Operating Expenses shall not include the costs of
special services rendered to tenants (including Tenant) for which a special or
separate charge is made, any costs of preparation of space for new tenants in
the Building, any costs borne directly by Tenant under this Lease, leasing
commissions, depreciation or interest payments, or debt service payments made to
a mortgagee and Landlord's Income Tax. Landlord and Tenant agree to coordinate
their insurance coverage in order to minimize, to the extent reasonably
possible, the same perils being insured by both the Tenant's and the Landlord's
insurance carriers.

         (b)      Real Estate Taxes shall include general and special taxes,
assessments, duties and levies, charged and levied upon or assessed against the
Building and/or any improvement situated on the real property on which the
Building stands, any leasehold improvement, fixtures, installations, additions
and equipment used in the maintenance or operation of the Building, whether
owned by Landlord or Tenant, not paid directly by the Tenant. Further, if at any
time during the term of this Lease, the method of taxation of real estate
prevailing at the time of execution hereof shall be or has been altered so as to
cause the whole or any part of the taxes now or hereafter levied, assessed or
imposed on real estate to be levied, assessed or imposed upon Landlord, wholly
or partially, as a capital levy or otherwise, or on, or measured by the rents
received from the Building, then such new or altered taxes attributable to the
Premises shall be deemed to be included within the term "Real Estate Taxes" for
purposes of this paragraph. The reference to "Building" in this subparagraph
shall include improvements on the real property on which the Building stands.

         (c)      Commencing on the first day of the first January after the
Commencement Date, and continuing thereafter during the term of this Lease,
Tenant shall pay to Landlord monthly in advance on the first day of each month,
without notice or demand and without any deduction, offset or abatement, in
lawful money of the United States of America, 1/12 of the amount of the Tenant's
Pro-Rata Share of the Shared Expenses as estimated by Landlord to be incurred
for the calendar year in which the monthly payments are to be made. If the
Expiration Date is not December 31, the monthly payments owning hereunder during
the last partial calendar year of the Lease shall be appropriately adjusted. For
the period from the Commencement Date to December 31 in the same calendar year,
Tenant shall not pay estimated Shared Expenses but shall be obliged for its
actual Pro-Rata Share of Shared Expenses for said period upon receipt of
Landlord's Statement described below. The term "Shared Expenses" shall mean the
amount by which Operating Expenses and Real Estate Taxes incurred in any period
exceed the amount of Landlord's obligation for the same as specified in Section
1.14 and 1.15. Tenant's Pro-Rata Share of the Shared Expenses shall not include
those items of Additional Rent which are paid directly by the Tenant Pursuant to
Section 25.25(g) of this Lease.

         (d)      In each calendar year after the year in which Commencement
Date occurs, Landlord shall send to Tenant a Landlord's Statement which shall
set forth the actual amount of Shared Expenses, with the exception of those
States in which real estate taxes are billed on other than a calendar year
basis, in that event Landlord's statement of Real Estate Taxes will be based on
the Real Estate Tax Fiscal Year and sent within a reasonable time after receipt
of Real Estate Tax Statements, and Tenant's Pro-Rata Share thereof for the
preceding calendar year or portion thereof and the estimated amount of Shared
Expenses and Tenant's Pro-Rata Share thereof for the calendar year in which the
Landlord's Statement is given. Landlord's failure to render a Landlord's
Statement with respect to any period shall not eliminate or reduce Tenant's
obligation to pay Shared Expenses and shall not prejudice Landlord's right to
render a Landlord's Statement with respect to any previous or subsequent period.
The obligations of Tenant under the provisions of this paragraph with respect to
any increase in rent shall survive the expiration or any sooner termination of
the term of the Lease. Within

<PAGE>   10

thirty (30) days next following the notification by Landlord of the contents of
its Landlord's Statement, Tenant shall pay to Landlord the entire amount of
Tenants Pro-Rata Share of actual Shared Expenses for the prior period covered by
the Landlord's Statement less the amount of Shared Expenses actually paid by
Tenant for said period, plus Tenant shall also then pay to Landlord such amount
as is necessary to assure that, through the calendar month in which Landlord's
Statement is given, the Tenant has paid to Landlord the full amount of estimated
Shared Expenses for the calendar year in which Landlord's Statement is given as
if the Landlord's Statement were given on January 1 of said calendar year. For
each month following for the remainder of said calendar year, Tenant shall pay
the monthly estimated Shared Expenses set forth in Landlord's Statement. In the
event that the estimated payments made by the Tenant in the calendar year
preceding the date on which the Tenant is given notice of the Landlord's
Statement exceed the Tenant's Pro-Rata Share of actual Shared Expenses for such
calendar year, then should the Tenant not be otherwise in default hereunder, the
amount of such excess shall be applied by the Landlord to the next succeeding
installments of monthly estimated payments of Shared Expenses if such
application can be made within ninety (90) days. If such application cannot be
completed within ninety (90) days, the balance shall be refunded to Tenant.

         6.3      STATEMENTS. Nothing in this Lease shall be construed to
require Landlord to render the statements described in Sections 5.2 and 6.2
simultaneously or in any particular order. Until Tenant is advised of the
adjustment in its obligation to pay Shared Expenses, if any, pursuant to the
provisions of Section 6.2, Tenant's monthly rental shall continued to be paid at
the then current rent (including all prior adjustments thereto pursuant to this
Lease). Upon written notice to Landlord of not less than thirty (30) business
days, Tenant shall have the right to review the documentation relied upon by
Landlord relating to the computation of Shared Expenses, which review shall
occur at the location of J. Marcus Painter as specified in Section 1.11 (b). All
Shared Expenses shall be computed on the actual basis. In computing Shared
Expenses, no cost or expense may be accounted more than once, any expenses which
are paid by the proceeds of insurance shall be excluded, and any expenses which
are separately metered or billed directly to and separately paid by any other
tenant shall be excluded. Tenant shall have the right to cause an audit to be
made of Landlord's computation of Shared Expenses at Tenant's sole expense, not
more frequently than once per calendar year. Tenant shall not be entitled to
withhold or deduct any portion of Base Rent or Additional Rent during the
pendency of any such audit. Any errors disclosed by such audit shall be promptly
corrected, provided that Landlord shall have the right to cause another
independent audit to be made of such computations, and in the event of a
disagreement between the auditors, both auditors shall mutually agree upon a
third auditor, whose determination shall be conclusive. The cost of the third
auditor shall be paid by the Landlord if an error of more than 10% in Landlord's
favor is determined to exist, and paid for by the Tenant if an error of less
than 10% in Landlord's favor is determined to exist.

7.       SECURITY DEPOSIT - INTENTIONALLY DELETED

8.       USE.

         8.1      USE. The Premises shall be used and occupied only for the uses
specified in Section 1.17 hereof, provided that the foregoing shall not be
construed as a representation or guarantee by the Landlord that such business
may lawfully be conducted on the Premises. Tenant acknowledges that Tenant has
examined the zoning requirements for the Property and that Tenant is satisfied
with such zoning as being appropriate for Tenant's intended use of the Property.

         8.2      COMPLIANCE WITH LAW. In the event it is determined by the
applicable governmental unit that the Premises violates any building code,
regulation or ordinance (other than zoning), then it shall be the obligation of
the Landlord, after written notice from Tenant which includes a copy of the
governmental unit's determination, to promptly, at Landlord's sole cost and
expense, rectify any such violation. In the event Tenant does not give to
Landlord written notice of any such violation within thirty (30) days from the
date on which Tenant takes possession of the Premises, it shall be conclusively
deemed that such violation, whether the same is patent or latent, did not exist
and the correction of the same shall be the obligation and expense of the Tenant
at the direction of the Landlord; provided, however, that nothing in this
Section shall be construed to require or permit the Tenant to make any
structural changes to the Building not caused by Tenant's improvements or the
nature of Tenant's occupancy of the Premises.

         8.3      WASTE AND NUISANCE. Tenant shall not commit, suffer or permit
any waste, damage, disfiguration or injury to the Premises, the common areas in
the Building, or the fixtures and equipment located therein or thereon. Tenant
shall not permit or suffer any overloading of the floors thereof, and shall not
place therein any heavy business machinery, safes, computers, data processing
machines, or other items heavier than customarily used for general
manufacturing, assembly, testing, storage, shipping, receiving and general
office purposes without first obtaining the written consent of Landlord. Tenant
shall not use or permit to be used any part of the Building for any dangerous,
noxious or offensive trade or business, and shall not cause or permit any
nuisance, noise, action, or disturbance of other tenants, in, at or on the
Premises.

<PAGE>   11

         8.4      CONDITION OF PREMISES. Except as provided in Section 8.2,
Tenant hereby accepts the Premises in their condition existing as of the date of
the Commencement hereof, subject to Tenant Improvement permits and subject to
all applicable zoning, municipal, county and state laws, ordinances and
regulations governing and regulating the use of the Premises, and accepts this
Lease subject thereto and to all matters disclosed thereby and by any exhibits
attached hereto. In addition, except as provided in Section 8.2, Tenant shall at
Tenant's expense, comply promptly with all applicable laws, statutes,
ordinances, rules, regulations, orders restrictions of record, and requirements
in effect during the term or any part of the term hereof regulating the use by
Tenant of the Premises.

         8.5      INSURANCE CANCELLATION. Notwithstanding the provisions of
Section 8.2 herein above, no use shall be made or permitted to be made of the
premises, nor acts done which will cause the cancellation of any insurance
policy covering said Premises or the Building, and if Tenant's use of the
Premises caused an increase in said insurance rates, Tenant shall pay any such
increase as Additional Rent, which, together with interest on any amount paid
therefor by Landlord, shall be payable by Tenant on the next succeeding date on
which a Base Rental payment is due.

         8.6      LANDLORD'S RULES AND REGULATIONS. Tenant shall faithfully
observe and comply with the reasonable rules and regulations that Landlord shall
from time to time promulgate, including without limitation any rules and
regulations (if any) attached to this Lease, which are hereby incorporated
wherein by this reference. Landlord reserves the right from time to time to make
all reasonable modifications to, or to promulgate for the first time, said rules
and regulations. The additions and modification to those rules and regulations
shall be binding upon Tenant upon Landlord giving notice of them to Tenant. To
the extent such Rules and Regulations are not adopted or do not exist as of the
Lease Date, Landlord's adoption of any Rules and Regulations shall be
reasonable.

9.       LANDLORD'S SERVICES

         9.1      BASIC SERVICES. Subject to any law, rule or governmental order
or regulation, and further subject to any circumstance beyond the control of the
Landlord, Landlord shall furnish the following services:

                  (a)      INTENTIONALLY DELETED.

                  (b)      Water for lavatory purposes and electric current for
         lighting the Premises and for ordinary office appliances and office
         machines only, provided that Tenant shall not use any electrical
         equipment which in Landlord's opinion will overload the wiring. If
         additional electrical service is necessary for Tenant's intended use of
         the Premises, and such service would overload existing electrical
         service, including wiring insulation, then Tenant, at Tenant's expense
         and with Landlord's written consent (which shall not be unreasonably
         withheld) may install such additional electrical service and wiring as
         may be necessary to avoid such overloading of existing systems. The
         cost of any additional electrical service required for the Tenant's use
         may be included under the Tenant Finish Allowance as provided by
         Section 25.25(c). If a further supply of water is required by Tenant,
         then at Tenant's expense, Landlord shall have the option to install and
         maintain a water meter to register such consumption, and Tenant shall
         pay as Additional Rent all costs for water consumed, at the cost to
         Landlord, and for sewer rents and all other rents and charges based
         upon such consumption of water;

                  (c)      In the event Tenant is delinquent in making any
         installment payment of rent under this Lease for a period of 15 days or
         more after it shall become due, upon fifteen (15) days written notice
         from the Landlord, Landlord may suspend Landlord's obligations to
         Tenant hereunder until all arrears of rental payments, plus interest
         and late charges and any other sums due under this Lease, shall have
         been paid in full.

                  (d)      Tenant may maintain and operate data processing
         equipment on the Premises, but all additional costs in connection
         therewith (including, but not limited to, additional support flooring,
         insulation, electrical outlets and temperature maintenance facilities)
         shall be borne solely by Tenant.

         9.2      INITIAL CONSTRUCTION. Landlord agrees to perform the work and
make such installations in the Premises as set forth in the Work Letter Addendum
which, if attached hereto as indicated in Section 1.19, constitutes additional
provisions of this Lease which are hereby incorporated by reference. Landlord
will construct the Premises and the Tenant Improvements in accordance with ADA
guidelines. Tenant acknowledges that it will examine the Premises before taking
possession hereunder and agrees that unless Tenant furnishes Landlord with a
notice in writing specifying any apparent unreasonable defect in the
construction within thirty (30) business days after such taking of possession
pursuant to Section 3.4, it shall be conclusively deemed that Tenant has
examined the Premises and that the same were in good order and that Landlord had
satisfactorily completed the work it agreed to perform. Tenant agrees that

<PAGE>   12
there is no promise, representation, or undertaking by or binding upon Landlord
with respect to any construction, alteration, remodeling or redecorating in or
to the Premises except as expressly set forth in the Work Letter Addendum.

         9.3      INTERRUPTION OF SERVICES. Landlord reserves the right from
time to time to install, maintain, repair, replace services to the Premises and
other parts of the Building. Interruption or curtailment of any service
maintained in the Building for less than 24 hours, if caused by strikes,
mechanical difficulties, actions of the Landlord under the first sentence of
this Section 9.3, or for any other reason beyond Landlord's control, shall not
entitle Tenant to any claim against Landlord or to any abatement in rent, nor
shall the same constitute constructive or partial eviction. Unless due to the
negligence of Landlord, Landlord shall not be liable to Tenant for any injury or
damage resulting from defects in the plumbing, heating, or electrical systems in
the Building or for any damage resulting from wind, snow, hail or rain storm. In
the event of any interruption or curtailment of services to the Premises or
Building by the Landlord, the Landlord agrees to give the Tenant reasonable
advance notice of such interruption or curtailment of services unless there is
an emergency.

10.      MAINTENANCE, REPAIRS AND ALTERATIONS.

         10.1     LANDLORD'S OBLIGATIONS. Subject to the provisions of Sections
8.2 and 14, and except for damage caused by any negligent or intentional act or
omission of Tenant, Tenant's agents, employees, representatives, customers or
invitees, in which event Tenant shall repair the damage, at its sole expense,
Landlord shall keep in good order, condition and repair (i) the roof; (ii)
structural elements of the building; (iii) the capital replacement and
maintenance of exterior water, sewer, fire connection and utility connection
lines up to the point of penetration of the exterior of the building structure,
including fiber conduit (but not fiber cabling); and all costs incurred by
Landlord in making any such replacement, repairs or performing such maintenance
shall not be Operating Expenses as defined in Section 6.2, provided that
Landlord shall have no obligation to perform any action which is the obligation
of Tenant. Other than as specifically provided in this Section 10.1 or elsewhere
in this Lease, Landlord shall not be obligated to make any repairs or
improvements of any kind, in, upon, about, or to the Premises or the Building.

         10.2     TENANT'S OBLIGATIONS. Subject to the provisions of Section 8.2
and 14, Tenant, at Tenant's expense, shall keep in good order, condition and
repair the demised Premises and every part thereof including, without limiting
the generality of the foregoing, all plumbing, electrical and lighting
facilities and equipment within the demised Premises, maintenance of any pumps
or apparatuses designed to prevent or minimize water seepage into the Premises,
fixtures, interior walls and interior surfaces of exterior walls, ceilings,
windows, doors, plate glass and skylights located within the demised Premises.
All repairs made by the Tenant shall be at least of the same quality, design and
class as that of the original work. Tenant agrees that it will abide by, keep
and observe all reasonable rules and regulations which Landlord may make from
time to time for the management, safety, care and cleanliness of the Building
and grounds, the parking of vehicles and the preservation of good order therein.
All damage or injury to the Building or to the demised Premises, fixtures,
appurtenances and/or equipment caused by the Tenant moving property in or out of
the Building or the Premises or by Tenant's installation or removal of
furniture, fixtures, or other property, or from any other cause of any kind or
nature whatsoever due to carelessness, omission, neglect, improper conduct, or
other cause of the Tenant, its agents, employees, invitees, contractors or
subcontractors shall be repaired, restored, or replaced promptly by the Tenant
at its sole cost and expense to the satisfaction of the Landlord. In the event
that the Tenant fails to keep the demised Premises in good order, condition and
repair while this Lease remains in effect, then upon the expiration of thirty
(30) days after written demand (which written demand shall not be required in
the case of an emergency), Landlord may restore the demised Premises to such
good order and condition and make such repairs without liability to Tenant for
any loss or damage that may accrue to Tenant's property or business by reason
thereof, and upon completion thereof Tenant shall pay to Landlord upon demand
and as Additional Rent the cost of restoring the demised Premises to such good
order and condition, together with interest thereon from the date paid.

         10.3     SURRENDER. On the last day of the term hereof or on any sooner
termination or date on which Tenant ceases to possess the Premises, Tenant shall
surrender the Premises to Landlord in good and clean condition, ordinary wear
and tear excepted. Prior to such surrender Tenant shall repair any damage to the
Premises occasioned by its removal of trade fixtures, furnishings and equipment,
which repair shall include the patching and filling of holes and repair of
structural damage. Tenant agrees to indemnify Landlord and hold Landlord
harmless from and against any liability (including reasonable attorneys' fees)
of Landlord to third parties resulting from Tenant's failure to timely comply
with the provisions of this Section 10.3.

         10.4     ALTERATIONS AND ADDITIONS.

                  (a)      Tenant shall not, without Landlord's prior written
         consent, which shall not be unreasonably withheld, delayed, or
         conditioned, make any alterations, improvements or additions (referred
         to collectively herein as "Alterations") in, or about

<PAGE>   13
         the Premises. Landlord may require that Tenant remove any or all of
         said Alterations at the expiration of the term or such other time at
         which Tenant ceases to possess the Premises, and restore the Premises
         to their prior condition; provided, however, Tenant shall not be
         required to remove any Alterations made to the Premises and approved by
         Landlord prior to the Commencement Date hereof. Should Tenant make any
         Alterations without the prior approval of the Landlord, Landlord may
         require that Tenant immediately remove any or all of such items and/or
         Landlord may declare a default by Tenant under this Lease. In no event
         shall Tenant place any exterior signs or interior drapes, blinds, or
         similar items visible from the outside of the Premises without the
         prior written approval of Landlord.

                  (b)      Any Alterations in, or about the Premises that Tenant
         shall desire to make shall be presented to Landlord in written form
         with proposed detailed plans. If Landlord shall give its consent, the
         consent shall be deemed conditioned upon Tenant acquiring a permit to
         do the work from appropriate governmental agencies, the furnishing of a
         copy thereof to Landlord prior to the commencement of the work, the
         compliance by Tenant with all conditions of said permit and with all
         specifications in the plans in a prompt and expeditious manner. Tenant
         shall not permit any of the work to be performed by persons not
         currently licensed under any applicable licensing laws or regulations
         pertaining to the types of work to be performed, except for Tenant's
         employees; provided, however, such employees' work must be performed in
         a good and workmanlike manner and such employees must be fully covered
         by requisite Workers' Compensation Insurance provided by Tenant.
         Landlord shall not be deemed unreasonable in the exercise of its
         discretion from withholding approval of any Alterations which involve
         or might affect any structural or exterior element of the Building, any
         area or element outside of the Premises, or any facility serving any
         areas of the Building outside of the Premises, or which will require
         unusual expense to re-adapt the Premises to normal office or warehouse
         use on the termination or expiration of the Lease, unless in the latter
         case Tenant either desires to or is required to make repairs or
         Alterations in accordance with this Lease.

                  (c)      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 materialman's lien against the Premises or the
         Building. Tenant shall give Landlord not less than ten (10) days'
         notice prior to the commencement of any work in, on or about the
         Premises, and Landlord shall have the right to post notices of
         non-responsibility in, on or about the Premises as provided by law.
         Tenant shall have no power or authority to do any act or make any
         contract which may create or be the basis for any lien upon the
         interest of the Landlord, the Premises or the Building, or any portion
         thereof. If any mechanics or other lien or any notice of intention to
         file a lien shall be filed or delivered with respect to the Premises or
         the Building, based upon any act of the Tenant or of anyone claiming
         through the Tenant, or based upon work performed or materials supplied
         allegedly for the Tenant, Tenant shall cause the same to be canceled
         and discharged of record within fifteen (15) days after the filing or
         delivery thereof. If Tenant has not so canceled the lien within fifteen
         (15) days as required herein, Landlord may pay such amount, and the
         amount so paid together with interest thereon from the date of payment
         and all legal costs and charges, including attorneys fees, incurred by
         Landlord in connection with said payment cancellation of the lien or
         notice of intent shall be additional Rent and shall be payable on the
         next succeeding date on which Base Rental Installment is due. Landlord
         may, at its option and without waiving any of its rights set forth in
         the immediately preceding sentence, permit Tenant to contest the
         validity of any such lien or claim, provided that in such circumstances
         the Tenant shall at its expense defend itself and Landlord against the
         same and shall pay and satisfy any such adverse judgment that may be
         rendered thereon before the enforcement thereof against the Landlord,
         the Premises or the Building, provided further that Landlord may at any
         time require the Tenant to deposit with the court exercising
         jurisdiction over such claim, such amount as may be necessary under
         applicable statutes to cause the release and discharge of the lien, and
         if Tenant shall not immediately make such payment upon the request of
         Landlord, Landlord may make said payment and the amount so paid,
         together with interest thereon from the date of payment and all legal
         costs and charges, including attorneys fees, incurred by Landlord in
         connection with said payment shall be deemed Additional Rent and shall
         be payable on the next succeeding date on which a Base Rental
         Installment is due. In addition, Landlord may require Tenant to pay
         Landlord's attorneys fees and costs in participating in such action if
         Landlord shall decide it is in its best interest to do so. Nothing
         herein contained shall be construed as a consent on the part of
         Landlord to subject the interest and estate of Landlord to liability
         under any lien law of the state in which the Premises are situated, for
         any reason or purpose whatsoever, it being expressly understood that
         Landlord's interest and estate shall not be subject to such liability
         and that no person shall have any right to assert any such lien.

                  (d) Unless Landlord requires their removal, as set forth in
         Section 10.4(a), all Alterations which may be made on the Premises
         shall, at the expiration of the term or such other time at which Tenant
         ceases to possess the Premises, become the property of Landlord and
         remain upon and be surrendered with the Premises. Notwithstanding the
         provisions of this Section 10.4(d), Tenant's machinery and equipment,
         shall remain the property of Tenant and may be removed by Tenant
         subject to

<PAGE>   14
         the provisions of Section 10.3 hereof and provided further that Tenant
         is not in default under this Lease at the time Tenant ceases to possess
         the Premises.

11.      TENANT'S USE OF PUBLIC AREAS - INTENTIONALLY DELETED

12.      TAXES AND TELEPHONE.

         12.1     PERSONAL PROPERTY TAXES. Tenant shall pay prior to delinquency
all taxes assessed against and levied upon leasehold improvements, fixtures,
furnishings, equipment and all other personal property of Tenant contained in
the Premises or elsewhere.

         12.2     EVIDENCE OF PAYMENT. Tenant shall promptly deliver to
Landlord, upon Landlord's written request, receipts for payments of all taxes,
charges, rates, dues, assessments and licenses in respect of all improvements,
equipment and facilities of the Tenant on or in the Premises which were due and
payable within a period up to one year prior to Landlord's making such request.

         12.3     TELEPHONE AND COMMUNICATION SYSTEMS. Tenant shall separately
arrange and pay for the furnishing of and use of all telephone and other
communication services as Tenant may deem necessary for its use of the Premises,
and Landlord shall have no liability in connection therewith.

13.      INSURANCE AND INDEMNITY.

         13.1     LIABILITY INSURANCE. Tenant shall, at Tenant's expense, obtain
and keep in force during the term of this Lease a policy of bodily injury and
personal property damage insurance, insuring Landlord and Tenant against any
liability arising out of the ownership, use, occupancy or maintenance of the
Premises and all areas appurtenant thereto. Such insurance shall be in an amount
not less than $500,000 per person, $500,000 per occurrence for bodily injury,
and $1,000,000 for personal property damage, or $2,000,000 combined single limit
for said items. The limits of said insurance shall not, however, limit the
liability of Tenant hereunder. Tenant shall also obtain and keep in force during
the term of this Lease, at Tenant's expense, "all risk" or "special coverage
form" insurance upon the property of every description and kind owned by the
Tenant and located in the Building or for which Tenant is legally liable or
installed by or on behalf of the Tenant, including without limitation,
furniture, fixtures, installations, alterations, additions, partitions, fixtures
and anything in the nature of leasehold improvements in an amount not less than
80% of the full replacement cost thereof. Such insurance shall insure the Tenant
and Landlord, and in the event that there shall be a dispute as to the amount
which comprises the full replacement cost, the decision of the Landlord shall be
conclusive. If Tenant shall fail to procure and maintain the insurance required
hereunder, Landlord may but shall not be required to procure and maintain the
same, and any amount so paid by Landlord for such insurance shall be Additional
Rent which, together with interest thereon from the date paid, shall be due and
payable by Tenant on the next succeeding date on which a Base Rental installment
is due if in the opinion of Landlord the amount of liability insurance required
hereunder is not adequate, then not more frequently than once during each
option, extension or renewal term of this Lease, if any, Tenant shall increase
said insurance coverage as required by Landlord. Provided, however, that in no
event shall the amount of the liability insurance increase by more than fifty
percent of the amount of the insurance during the preceding term of this Lease.
However, the failure of Landlord to require any additional insurance coverage
shall not be deemed to relieve Tenant from any obligations under this Lease.

         13.2     PROPERTY INSURANCE. Landlord shall insure the Building and the
Premises, and keep in force during the term of this Lease, against fire and
extended coverage an "all risk" property insurance, including vandalism coverage
and malicious mischief and sprinkler leakage, water seepage (if available), in
an amount not less than 80% of replacement with a company rated A+, AAA or
better in "Best Insurance Guide." Landlord may also, but shall not be required
to, procure any other insurance policies respecting the Premises or Building
which Landlord deems necessary.

         13.3     INSURANCE POLICIES. Insurance required by Tenant hereunder
shall be in companies rated A+, AAA or better in "Best Insurance Guide." Tenant
shall deliver to Landlord prior to taking possession of the Premises copies of
policies of such insurance or certificates evidencing the existence and amounts
of such insurance with loss payable clauses reasonably satisfactory to Landlord.
No such policy shall be cancelable or subject to reduction of coverage or other
modification except after ten (10) days' prior written notice to Landlord.
Tenant shall, within ten (10) days prior to the expiration of such policies,
furnish Landlord with renewals thereof, or Landlord may order such insurance and
charge the cost thereof to Tenant, which amount, together with interest thereon,
or Landlord may order such insurance and charge the cost thereof to Tenant,
which amount, together with interest thereon, shall be Additional Rent and shall
be payable by Tenant on the next succeeding date on which a Base Rental payment
is due. Tenant shall not do or permit to be done anything which shall invalidate
the insurance policies referred to in Section 13.1. Tenant shall forthwith, upon

<PAGE>   15

Landlord's demand, reimburse Landlord for any additional premiums attributable
to any act or omission or operation of Tenant causing an increase in the cost of
insurance.

         13.4     WAIVER OF SUBROGATION. As long as their respective insurers so
permit, Tenant and Landlord each waives any and all rights of recovery against
the other, or against the officers, employees, agents and representatives of the
other for loss or damage to such waiving party or its property or the property
of others under its control, where such loss or damage is insured against under
any insurance policy in force at the time of such loss or damage. Tenant and
Landlord shall, upon obtaining the policies of insurance required hereunder,
give notice to the insurance carriers that the foregoing mutual waiver of
subrogation is contained in this Lease and obtain policies of insurance, if
obtainable, which shall include a waiver by the insurer of all right of
subrogation against Landlord or Tenant in connection with any loss or damage
thereby insured against.

         13.5     HOLD HARMLESS. Tenant shall indemnify, defend and hold
Landlord harmless from any and all claims, liabilities, damages and costs,
including attorneys fees, incurred by Landlord, except for Landlord's
negligence, which arise from Tenant's use of the Premises or the Building or
from the conduct of its business or from any activity, work or things which may
be permitted or suffered by Tenant in, on or about the Premises or the Building,
and shall further indemnify, defend and hold Landlord harmless from and against
any and all claims, liabilities, damages and costs, including attorneys fees,
incurred by Landlord, which arise from any breach or default in the performance
of any obligation on Tenant's part to be performed under any provision of this
Lease or which arise from any negligence of Tenant or any of its agents,
representatives, customers, employees or invitees.

         13.6     EXEMPTION OF LANDLORD FROM LIABILITY. Tenant hereby agrees
that Landlord shall not be liable for injury to Tenant's business or any loss of
income therefrom, including without limitation from any relocation by Landlord
of Tenant within the Building, or for damage to the goods, wares, merchandise or
other property of Tenant, Tenant's employees, representatives, agents, invitees,
customers or any other person in, on or about the Premises or Building, nor
shall Landlord be liable for injury to the person of Tenant, Tenant's employees,
representatives, agents, customers, or invitees, whether any such damage or
injury is caused by or results from fire, steam, electricity, gas, water, snow,
hail or rain, or from the breakage, leakage, obstruction or other defects of
pipes, sprinklers, wires, appliances, plumbing, air conditioning or lighting
fixtures, or from any other cause, and whether the said damage or injury results
from conditions arising upon the Premises or any other cause, and whether the
said damage or injury results from conditions arising upon the Premises or
Building, or from other sources or places, and regardless of whether the cause
of such injury or the means of repairing the same is inaccessible to Landlord or
Tenant, unless such injury, loss of income or damage is caused by the Landlord's
negligence. Landlord shall not be liable for any damages arising from any act or
neglect of any other tenant, if any, of the Building. Tenant hereby assumes all
risk of damage to property or injury to persons in, on or about the Premises or
the Building from any cause and Tenant hereby waives all claims in respect
thereof against Landlord, excepting where said damages arises out of the
negligence of Landlord.

14.      DAMAGE OR DESTRUCTION.

         14.1     OPTION TO TERMINATE LEASE. If the Premises or any part thereof
shall be damaged or destroyed by fire or other casualty, the Landlord may, at
its option and subject to Section 14.2 herein below, elect to terminate this
Lease by giving notice to the Tenant within ninety (90) days after Landlord
receives actual notice of the fire or other casualty, and thereupon the term of
this Lease shall expire by lapse or time upon the tenth day after such notice is
given. Instead of exercising said option, Landlord may elect to repair or
restore the premises to the same condition as existed before such damage or
destruction. Upon electing to repair or restore, Landlord may proceed with
reasonable dispatch to perform the necessary work, and the Base Rent to be paid
until such work is completed shall be abated in proportion of the Premises being
unusable for a period equal to the number of days Tenant is unable to use the
Premises, but Landlord shall not be liable for any loss of profits or income.
Notwithstanding the foregoing, there shall be no abatement, apportionment or
reduction in the rental obligations of Tenant if the damage or destruction is
caused by the Tenant or Tenant's agents, representatives, employees, customers
or invitees.

         14.2     OBLIGATION TO REPAIR OR RESTORE. If and only if all of the
following circumstances exist with respect to damage or destruction to the
Premises, Landlord may not elect to terminate the Lease as provided in Section
14.1 hereof but rather must elect to repair or restore the Premises:

                  (a)      There is no fault or neglect on the part of the
         Tenant, Tenant's agents, representatives, employees, customers, or
         invitees which contributed to the damage or destruction.

                  (b)      The damage or destruction to the Premises is less
         than fifty percent (50%) of the replacement cost thereof as

<PAGE>   16
         determined by Landlord;

                  (c)      The Landlord is fully insured for the casualty which
         causes the damage or destruction and the insurance proceeds have been
         made available therefor by the holder or holders of any mortgages or
         deeds of trust covering the Premises.

                  (d)      The date of the damage or destruction is greater than
         one year prior to the Expiration Date of this Lease or any renewal,
         modification or extension thereof; and Less than sixty percent (60%) of
         the rentable square feet of the Building is so damaged or destroyed, as
         determined by Landlord, regardless of the percentage of rentable square
         feet of the Premises which may be damaged or destroyed.

         14.3     FAULT OF TENANT. Landlord may exercise its option to repair or
restore as described in Section 14.1 even if such damage or destruction is due
to the fault or neglect of Tenant, Tenant's agents, representatives, employees,
customers or invitees, but in such event Landlord's election to repair or
restore shall be without prejudice to any other rights and remedies of Landlord
under this Lease, and there shall be no apportionment or abatement of any rent
of any kind and Landlord shall not be liable for any other loss to Tenant of any
nature whatsoever.

         14.4     OBLIGATIONS OF TENANT. Except as provided in this Section 14,
none of Tenant's obligations under this Lease shall be affected by any damage or
destruction of the Premises by any cause whatsoever.

         14.5     TERMINATION BY TENANT. In the event that more than sixty
percent (60%) of rentable square feet of the Premises shall be damaged or
destroyed by fire or other casualty, or the time to repair the damage is more
than one hundred and twenty (120) days, either party may terminate this Lease by
giving notice to the other within thirty (30) business days after the date of
the fire or other casualty, and upon such termination the rental obligations of
the Tenant shall be duly apportioned as of the date of such fire or other
casualty, provided, however, that Tenant shall have no right to terminate the
Lease under this Section 14.5 if (i) Tenant is in default of any of its
obligations under the Lease as of the date of the fire or other casualty, or
(ii) such damage or destruction was caused by Tenants agents, representatives,
employees, customers or invitees.

15.      CONDEMNATION.

         If the Premises are taken under any public or private power or eminent
domain, or sold by Landlord under the threat of the exercise of said power (all
of which is herein referred to as "condemnation"), or if any portion of the
Building is so condemned so that it would not be practical, in Landlord's
judgment, to continue to maintain the Building, this Lease shall terminate as of
the date of the condemning authority takes title or possession, whichever occurs
first. If only a portion of the Premises are so condemned, Landlord shall have
the right, if more than sixty percent (60%) of rentable square feet of the
Premises are so condemned, to terminate this Lease as of the date the condemning
authority takes title or possession, which ever occurs first, by Landlord's
giving written notice of such termination to Tenant not later than thirty (30)
days after said date, but should Landlord elect not to so terminate this Lease,
the Lease shall remain in full force and effect as to the portion of the
Premises not so taken, and Tenant's rental obligations shall be reduced
proportionately to reflect the number of rentable square feet remaining in the
Premises, and such rental reduction, if any, shall take effect as of the date
which is thirty (30) days after the date on which the condemning authority takes
title or possession, whichever first occurs. If repairs or restorations to that
portion of the Premises not so taken are deemed necessary by Landlord to render
such portion reasonably suitable for the purposes for which it was leased, as
determined by Landlord, Landlord shall perform such work at its own cost and
expense but in no event shall Landlord be required to expend any amount greater
than the amount received by Landlord as compensation for the portion of the
Premises taken by the condemnor. All awards for the taking of any part of the
Premises or any payment made under the threat of the exercise of power of
eminent domain shall be the property of Landlord, whether made as compensation
for diminution of value of the leasehold or for the taking of the fee or as
severance damages. No award for any partial or entire taking shall be
apportioned, and Tenant hereby assigns to Landlord any award which may be made
in such taking or condemnation, together with any and all rights of Tenant now
or hereafter arising in or to the same or any part thereof, except that any
award or other compensation made for any taking is subject to the rights of the
first mortgagee, up to the full amount of such junior lien; provided, however,
that Tenant shall be entitled to any award for loss of or damage to Tenant's
trade fixtures and removable personal property and/or for the interruption of or
damage to Tenant's business.

16.      ASSIGNMENT OR SUBLETTING.

         16.1     LANDLORD'S CONSENT REQUIRED. Tenant shall not voluntarily or
by operation of law assign, transfer, mortgage, sublet or

<PAGE>   17
otherwise transfer or encumber all or any part of Tenant's interest in this
Lease or in the Premises without Landlord's prior written consent, which shall
not be unreasonably withheld, delayed or conditioned. Landlord's consent shall
not be required for an assignment or subletting to an affiliate, parent company
or subsidiary of the Tenant, provided the Guaranty of the base by EMC
Corporation remains in full force and effect. Any attempted assignment,
transfer, mortgage, encumbrance or subletting without such consent shall be void
and shall constitute a breach of the Lease. Any transfer of Tenant's interest in
this Lease or in the Premises from Tenant by merger, consolidation or
liquidation, or by any subsequent change in the ownership of fifty percent (50%)
or more of the capital stock of Tenant shall be deemed a prohibited assignment
within the meaning of this Section 16. As a condition of obtaining Landlord's
consent, Tenant shall submit to Landlord together with its request for consent
the name of the proposed assignee or subtenant, the terms and provisions of the
proposed transaction, and such information as to the nature of the proposed
assignee's or subtenant's business and its financial responsibility and standing
as Landlord may reasonably require, together with the effective date of the
proposed transfer which shall be at least sixty (60) days after the date of
submission of such information to Landlord. Landlord's failure to consent to any
proposed transfer under this Section shall not be deemed unreasonably withheld
if (a) the occupancy resulting from such transfer will not be consistent with
the general character of the business carried on by the tenants of the Building
or violates any rights or options held by any other tenant of the building; or
(b) the proposed occupant pursuant to the transfer does not have the financial
strength and stability to perform its rental obligations or Landlord is unable
to obtain guaranties from one or more affiliates of the proposed occupant in
order to secure such financial obligations; or (c) any proposed sublease does
not incorporate this Lease in its entirety so as to be subject to this Lease's
terms, or any such sublease does not require the sublessee to attorn to Landlord
at Landlord's option in the event of a default by Tenant under this Lease; or
(d) if Tenant does not execute an agreement with Landlord requiring Tenant to
pay to Landlord, as Additional Rent, fifty percent (50%) of all moneys or other
consideration received by Tenant from its transferee (whether paid to Tenant as
consideration for Tenant's transfer of property or other assets to the
transferee or as consideration for the transferee's occupancy of the Premises)
in excess of the amounts owed by Tenant to Landlord under this Lease, which
Additional Rent shall be paid to Landlord as and when received by Tenant.

         16.2     NO RELEASE OF TENANT. Regardless of Landlord's consent, no
subletting or assignment or other transfer described in Section 16.1 shall
release Tenant (or any guarantor of Tenant's obligations hereunder) from
Tenant's obligations or alter the primary liability of Tenant to pay the rent
and to perform all other obligations to be performed by Tenant hereunder.
Consent to one assignment, subletting or other transfer shall not be deemed
consent to any subsequent act. In the event of default by any assignee of Tenant
or any successor of Tenant in the performance of any of the terms hereof,
Landlord may proceed directly against Tenant without the necessity of exhausting
remedies against said assignee or successor. Landlord may consent to subsequent
assignments, subletting, or transfers of this Lease or amendments or
modifications to this Lease with assignees or successors of Tenant without
notifying Tenant and without obtaining its consent thereto and such action shall
not relieve Tenant of liability under this Lease. In the event Landlord allows
assignment or subletting hereunder, neither Tenant, the assignee of Tenant, or
the sublessee of Tenant shall have any option to extend the term of this Lease
even if such option is otherwise granted to Tenant herein and notwithstanding
the provisions of any such option granted to Tenant herein, and all rights and
options to extend this Lease otherwise granted to Tenant shall be deemed
terminated and canceled as of the date of such assignment, subletting or other
transfer. Notwithstanding anything in this Lease to the contrary, Landlord shall
have no obligation to grant consent to any transfer as defined in Section 16.1
if Tenant is in default under this Lease at the time the request for consent is
made or at any time thereafter through the effective date of the transfer. In
addition, Tenant acknowledges that its intent in executing this Lease is to
occupy the Premises and not to make speculative usage of the Premises, and
therefore Landlord shall have no obligation whatsoever to consent to any
proposed transfer if the rentals payable by the proposed occupant to the Tenant
are less than the rental sought to be received by the Landlord for vacant space
in the Building as of the date on which the Tenant is requesting the Landlord's
consent to the transfer. In the event that Tenant proposes to assign this Lease
or to sublet all of the Premises, Landlord shall have the right, exercisable by
notice in writing after receipt of the request by Tenant, to terminate this
Lease upon execution of an agreement between Landlord and the proposed assignee
or subtenant, provided that Landlord shall not have any such termination right
if Tenant withdraws such request within ten (10) days of being notified by
Landlord that it has elected to exercise said termination right.

         16.3     ATTORNEYS FEES AND ADMINISTRATIVE FEES. In the event Tenant
shall request consent of Landlord to any assignment, subletting or transfer or
if Tenant shall request the consent of Landlord for any other act which Tenant
proposes to do under any other provision of this Lease, then Tenant shall pay
Landlord's attorneys fees incurred in connection with the consideration or
evaluation of such request. In addition thereto, in the event that Landlord
shall consent to a sublease, assignment or transfer under Section 16.1, Tenant
shall pay Landlord administrative fees of two hundred and fifty dollars ($250)
incurred in connection with giving such consent.

         16.4     RIGHT TO COLLECT RENT. The acceptance of rent by Landlord from
any person other than Tenant shall not be deemed to be a waiver by Landlord of
any provisions of this Lease. If the Premises are sublet or occupied by anyone
other than Tenant and Tenant

<PAGE>   18
is in default hereunder, or this Lease is assigned by Tenant, then, in any such
event, Landlord may collect rent from the assignee, subtenant or occupant and
apply the net amount collected to the rent reserved in this Lease, but no such
collection shall be deemed a waiver of the covenant in this Lease against
assignment and subletting or the acceptance of such assignee, subtenant or
occupant as tenant, or a release of Tenant (or of any guarantor of Tenant's
obligations hereunder) from further performance of the covenants contained in
this Lease.

17.      DEFAULTS; REMEDIES.

         17.1     DEFAULTS. The occurrence of any one or more of the following
events shall constitute a default and breach of this Lease by Tenant:

                  (a)      The failure by Tenant to make any payment of Base
         Rent, Additional Rent or any other payment required to be made by
         Tenant hereunder, as and when due, where such failure shall continue
         for a period of ten (10) business days after notice; or

                  (b)      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 described in paragraph (a) above, where
         such failure shall continue for a period of twelve (12) business days
         after written notice thereof from Landlord to Tenant; provided,
         however, that if the nature of Tenant's default as determined by
         Landlord is such that more than twelve (12) business days are
         reasonably required for its cure, then Tenant shall not be deemed to be
         in default if Tenant commences such cure as soon as possible within
         said twelve (12) business day period and thereafter diligently
         prosecutes such cure to completion, and in any case completes said cure
         within sixty (60) calendar days after the aforesaid written notice; or

                  (c)      (i) The insolvency of the Tenant or the execution by
         the Tenant of an assignment for the benefit of creditors, or the
         convening by Tenant of a meeting of its creditors, or any class
         thereof, for the purposes of effecting a moratorium upon or extension
         or composition of its debts; or the failure of the Tenant to generally
         pay its debts as they mature; or (ii) the filing by or for
         reorganization or arrangement under any law relating to bankruptcy
         (unless in the case of a petition filed against Tenant, the same is
         dismissed within sixty (60) days); or (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; or
         (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.

         17.2     Remedies in Default.

                  (a)      In the event of any such default or breach by Tenant,
         Landlord shall have the right 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 otherwise have by reason of such
         default or breach, to terminate this Lease at its option or to re-enter
         and at its option to attempt to re-let without terminating this Lease
         and remove all persons and property from the Premises, using any force
         as may reasonably be necessary to accomplish said purposes, all without
         service of notice or resort to legal process and without being deemed
         guilty of trespass or forcible entry or becoming liable for any loss or
         damage which may be occasioned thereby.

                  (b)      If Tenant shall fail to remove any effects which it
         is entitled to remove from the Premises upon the termination of this
         Lease, or any extension or renewal hereof, or upon a re-entry by
         Landlord for any cause whatsoever, or upon Tenant's ceasing to possess
         the Premises for any reason, the Landlord, at its option, may remove
         the same and store or dispose of the said effects without liability for
         loss or damage thereto, and Tenant agrees to pay to Landlord on demand
         any and all expenses incurred in such removal, including Court costs,
         attorneys fees, storage and insurance charges on such effects for any
         length of time the same shall be in Landlord's possession; or the
         Landlord, at its option, without notice, may sell such effects, or any
         of them, at private or public sale and without legal process, for such
         price or consideration as the Landlord may obtain, and apply the
         proceeds of such sale upon any amounts due under this Lease from the
         Tenant to the Landlord, and upon the expenses incidental to the
         removing, cleaning the Premises, selling said effects, and any other
         expense, rendering the surplus, if any, to the Tenant; provided,
         however, in the event the proceeds of such sale or sales are
         insufficient to reimburse the Landlord, Tenant shall pay such
         deficiency upon demand. Tenant acknowledges and agrees that any such
         disposition of Tenant's property in the above-described manner by the
         Landlord shall be deemed to be commercially

<PAGE>   19

         reasonable and that no bailment shall be created by Landlord's exercise
         of any of its rights under this paragraph (b). If Landlord is unable to
         sell certain of Tenant's effects hereunder and Tenant does not retrieve
         such effects from Landlord after ten (10) days written notice as
         provided herein to Tenant to do so, such effects shall be conclusively
         deemed abandoned and Landlord shall be free to dispose of such effects
         as Landlord deems appropriate

                  (c)      Should Landlord elect to re-enter, as herein
         provided, or should it take possession pursuant to legal proceedings,
         or pursuant to any notice provided for by law, it may make such
         alterations, additions, improvements and repairs as may be necessary in
         order to re-let the Premises, and may but need not re-let the Premises
         or any part thereof for such term or terms (which may be for a term
         extending beyond the term of this Lease) and at such rental or rentals
         and upon such other terms and conditions as Landlord may determine to
         be advisable; upon each such re-letting all rentals received by
         Landlord; second the payment of any costs and expenses of such
         re-letting, including brokerage fees and attorneys fees and the cost of
         such alterations, improvements and repairs; third, to the payment of
         Base Rent due and unpaid hereunder, and the residue, if any, shall be
         held by Landlord and applied in payment of future rent as the same may
         become due and payable hereunder provided that Tenant shall have no
         right to claim any interest in all or any portion of said residue and
         if the rent and other charges paid or to be paid to Landlord by any new
         tenant pursuant to any re-letting exceed the monetary obligations of
         Tenant, Tenant shall have no right to claim any interest in all or any
         portion of said excess. If such rental received from such re-letting
         during any month be less than that to be paid during the month by
         Tenant hereunder, Tenant shall pay any such deficiency to Landlord, and
         such deficiency shall be calculated and paid monthly on the date on
         which the rent would have been payable hereunder if possession had not
         been retaken. If the Premises are re-let by Landlord during the
         existing term of this Lease, and the premises covered thereby include
         other premises not part of the Premises, a fair apportionment of the
         rent received from such re-letting and the expenses incurred in
         connection therewith as provided aforesaid will be made in determining
         the net proceeds from such re-letting and the expenses incurred in
         connection therewith as provided aforesaid will be made in determining
         the net proceeds from such reletting, and any rent concessions will be
         equally apportioned over the term of the new Lease. Landlord shall in
         no event be liable in any way whatsoever for failure to re-let the
         premises for any reason, or in the event the Premises are re-let, for
         failure to collect the rent thereof under such re-letting. No such
         reentry or taking possession of the Premises by Landlord, nor any acts
         pursuant thereto, shall be construed as an election on its part to
         terminate this Lease unless a written notice of such termination be
         given to Tenant by Landlord. No notice from Landlord under this Lease
         or under any applicable forcible entry and detainer or eviction statute
         or similar law shall constitute an election by Landlord to terminate
         this lease unless such notice specifically so states. Notwithstanding
         any such reletting without termination, Landlord may at any time
         thereafter elect to terminate this Lease for such previous breach.

                  (d)      Should Landlord at any time terminate this Lease for
         any default or breach, in addition to any other remedies it may have,
         it may recover from Tenant all damages it may incur by reason of such
         default or breach, including the cost of recovering the Premises,
         reasonable attorneys fees, and including the worth at the time of such
         termination of the excess, if any, of the amount of rent and such other
         charges as are required to be paid by Tenant under the terms of this
         Lease for the remainder of the stated term over the then reasonable
         rental value of the Premises for the remainder of the stated term, all
         of which amounts shall be immediately due and payable from Tenant to
         Landlord; provided, however, that if the then reasonable rental value
         of the Premises exceeds the value of the rent and other charges
         required to be paid by Tenant under this Lease as aforesaid, Tenant
         shall have no right to claim any interest in all or any portion of such
         excess. In determining the rent which would be payable by Tenant
         hereunder, subsequent to default, the annual rent for each year of the
         unexpired term shall be equal to the average annual Base Rent and
         additional Rent paid or payable by Tenant from the Commencement Date of
         this Lease to the time of default, or during the preceding three (3)
         full calendar years, whichever is shorter; and

                  (e)      Each of the remedies set forth herein above in this
         Section 17 shall not be exclusive, but rather shall be considered
         cumulative with any other legal or equitable remedy now or hereafter
         available to Landlord under the laws or judicial decisions of the state
         in which the Premises are located. To the extent such waiver is
         permitted by law, the parties waive trial by jury in any action or
         proceeding brought in connection with this Lease. Suit or suits for the
         recovery of the amount of damages set forth herein above may be brought
         by Landlord, from time to time, at Landlord's election, and nothing
         herein shall be deemed to require Landlord to await the date whereon
         this Lease or the term hereof would have expired had there been no
         event of default. Nothing contained in this Lease shall limit or
         prejudice the right of Landlord to prove and obtain as liquidated
         damages in any bankruptcy, insolvency, receivership, reorganization or
         dissolution proceeding an amount equal to the maximum allowed by any
         statute or rule of law governing such proceeding and in effect at the
         time when such damages are to be proved, whether or not such amount be
         greater, equal to or less than the amounts recoverable, either as
         damages or rent, referred to in any of the preceding provisions of this
         Section.

<PAGE>   20
         17.3     DEFAULT BY LANDLORD. Landlord shall not be in default unless
Landlord fails to perform obligations required by Landlord within thirty (30)
days after written notice by Tenant to Landlord and to the holder of any first
mortgage or deed of trust covering the Premises, specifying the manner in which
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 performance as determined by Landlord, then Landlord shall not be
in default if Landlord commences performance within such thirty day period and
thereafter diligently prosecutes the same to completion; provided further that
Landlord's obligation to perform any act under this Lease shall be excused for
any period of time during which Landlord is prevented from performing because of
any circumstance beyond Landlord's control. Tenant's remedies upon Landlord's
default are further limited by Section 18.3 and 25.2 below.

         17.4     LATE CHARGES. Tenant hereby acknowledges that late payment by
Tenant to Landlord of rent and 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 covering the Premises.
Accordingly, if any installment of Base Rent, Additional Rent or any other sum
due from Tenant shall not be received by Landlord or Landlord's designee within
ten (10) days after notice that the amount is due, then Tenant shall immediately
pay to Landlord a late charge equal to four percent (4%) of such over due amount
or the sum of Two Hundred Fifty Dollars ($250.00), whichever is greater. The
parties hereby agree that such late charge represents a fair and reasonable
estimate of the cost Landlord will incur by reason of late payment by Tenant and
is in addition to interest due under Section 25.4. Acceptance of such late
charge by Landlord shall in no event constitute a waiver of Tenant's default
with respect to such overdue amount, or prevent Landlord from exercising any of
the other rights and remedies granted hereunder.

18.      RIGHTS OF MORTGAGEES.

         18.1     SUBORDINATION. As used throughout this Section 18, the term
"mortgagee" shall refer to the holder of a Mortgage or deed of trust or ground
lease affecting the Premises. This Lease and the rights of Tenant hereunder
shall be and are hereby made subject and subordinate to the provisions of any
ground lease, mortgage or deed of trust affecting the Premises, and to each
advance made or hereafter to be made under the same, and to all renewals,
modifications, consolidations and extensions thereof and all substitutions
therefor. This Section 18 shall be selfoperative and no further instrument of
subordination shall be required. However, in confirmation of the provisions of
this Section 18, Tenant shall execute and deliver promptly any certification or
instrument that Landlord or any mortgagee may request, and failing to do so
within ten (10) days after written demand, Tenant does hereby make, constitute
and irrevocably appoint Landlord as Tenant's attorney-in-fact and Tenant's name,
place and stead, to do so, and/or Landlord may declare this Lease to be in
default. If any mortgagee or ground lessor shall elect to have this Lease prior
to the lien of its mortgage, deed of trust or ground lease, and shall give
written notice thereof to Tenant, this Lease shall be-deemed prior to such
mortgage, deed of trust or ground lease, whether this Lease is dated prior or
subsequent to the date of said mortgage, deed of trust or ground lease or the
date of recording thereof. Tenant shall and does hereby agree to attorn to any
mortgagee or successor in title and to recognize such mortgagee or successor as
its Landlord in the event any such person or entity succeeds to the interest of
Landlord. Notwithstanding any other provisions of this Lease, in the event that
any mortgagee or its respective successor in title shall succeed to the interest
or Landlord hereunder, the liability of such mortgagee or successor shall exist
only so long as it is the owner of the Building, or any interest therein, or is
the tenant under said ground lease.

         18.2     MORTGAGEE'S CONSENT TO AMENDMENTS. No assignment of this Lease
and no agreement to make or accept any surrender, termination or cancellation of
this Lease and no agreement to modify so as to reduce the rent, change the term,
or otherwise materially change the rights of Landlord under this Lease, or to
relieve Tenant of any obligation or liability under this Lease, shall be valid
unless consented to by Landlord's mortgagees of record, if such is required by
the mortgagees, in writing. No Base Rent, Additional Rent, or any other charge
(with the exception of the security deposit described in this Lease) shall be
paid more than ten (10) days prior to the due date thereof and payments made in
violation of this provision (except to the extent that such payments are
actually received by a mortgagee) shall be a nullity as against any such
mortgagee of record, and Tenant shall be liable for the amount of such payments
to such mortgagees.

         18.3     MORTGAGEE'S RIGHT TO CURE. No act or failure to act on the
part of Landlord which would entitle Tenant under the terms of this Lease, or by
law, to be relieved of Tenant's obligations hereunder or to terminate this
Lease, shall result in a release or termination of this Lease unless (a) Tenant
shall have first given written notice of Landlord's act or failure to act to
Landlord's mortgagees of record, if any, specifying the act or failure to act on
the part of Landlord which could or would give basis to Tenant's rights; and (b)
such mortgagees, after receipt of such notice, have failed or refused to correct
or cure the condition complained of within a reasonable time thereafter,
provided that nothing contained in this Section shall be deemed to impose any
obligation on any such mortgagees to correct or cure any condition. As used
herein, a "reasonable time" includes a reasonable time to correct or cure the

<PAGE>   21

condition if such condition is determined to exist, but in no event less than
120 days from the date of the mortgagees' receipt of the above described notice.

19.      NOTICES.

         Except as provided in Section 17. 1 (b) and 22, whenever under this
lease provision is made for any demand, notice or declaration of any kind, or
where it is deemed desirable or necessary by either party to give or serve any
such notice, demand or declaration to the other party, it shall be in writing
and served either personally or sent by certified United States mail, return
receipt requested, postage prepaid, addressed either to the address set forth in
Section 1.1 or 1.11(b) 1.11(a), 1.11(c), or to such other address as may be
given by a party to the other by proper notice hereunder, or, in the case of
notices to the Tenant, to the Premises. The date of personal delivery (as
evidenced by such evidence of service as provided for in said rules) or the date
on which the certified mail is deposited with the United States Postal Service
shall be the date on which any proper notice hereunder shall be deemed given.

20.      RELOCATION - INTENTIONALLY DELETED

21.      QUIET POSSESSION.

         Upon Tenant paying the sums due hereunder and observing and performing
all of the covenants, conditions and provisions on Tenant's part to be observed
and performed hereunder, Tenant shall have quiet possession of the Premises for
the entire term hereof subject to all of the provisions of this Lease.

22.      RENEWAL OPTIONS.

         Tenant shall have two successive one (1) year options to renew this
Lease beyond its original three year term, such renewals to be subject to all
terms of this Lease except that the Base Rent upon renewal shall be adjusted to
the then Fair Market Rent for the Premises. "Fair Market Rent" shall be the rate
being charged for comparable space, as of the commencement of the option term,
taking into consideration the size, location, quality of the leased Premises,
and any other relevant terms and conditions for a comparable term, including any
concessions or inducements generally being granted at such time. Notwithstanding
the foregoing, Fair Market Rent for the option term shall not be less than Base
Rent paid by the Tenant for the year immediately preceding commencement of that
option term. Tenant shall provide its written notice of intent to renew not less
than one hundred eighty (180) days prior to the expiration of the then current
term of the Lease. Each of such options is personal to Tenant and may not be
exercised by or assigned, voluntarily or involuntarily, by or to anyone other
than Tenant. No such option described herein above may be exercised by the
Tenant except in strict accordance with the terms and provisions of the option
and provided that Tenant is not in default under this Lease either at the time
Tenant gives notice of its intent to exercise the option or at the time at which
the option is to be exercised. Notwithstanding the provisions of Section 19,
notice of exercise of any option shall be deemed given only when actually
received by Landlord.

23.      LANDLORD'S LIEN - INTENTIONALLY DELETED

24.      HAZARDOUS MATERIALS.

         Tenant covenants not to introduce any hazardous or toxic materials onto
the Building, leased Premises, or the grounds surrounding the Building, without
(a) first obtaining Landlord's written consent and (b) complying with all
applicable federal, state and local laws or ordinances pertaining to the
transportation, storage, use or disposal of such materials, including but not
limited to obtaining proper permits.

         If Tenant's transportation, storage, use or disposal of hazardous or
toxic materials on the Building, leased Premises, or the grounds surrounding the
Building results in (1) contamination of the soil or the surface or ground water
or (2) loss or damage to person(s) or property, then Tenant agrees to respond in
accordance with the following paragraphs:

         Tenant agrees (i) to notify Landlord immediately of any contamination,
claim of contamination, loss or damage, (ii) after consultation and approval by
Landlord, to clean up and (iii) to indemnify, defend and hold Landlord harmless
from and against any claims, suits, causes of action, costs and fees, including
attorneys fees, arising from or connected with any such contamination, claim of
contamination, loss or damage. This provision shall survive the termination of
this Lease.

<PAGE>   22
25.      GENERAL PROVISIONS

         25.1     ESTOPPEL CERTIFICATE.

                  (a)      Tenant shall at any time upon not less than thirty
                           (30) days' prior written notice from Landlord,
                           execute, acknowledge and deliver to Landlord a
                           statement in writing: (i) certifying that this Lease
                           is unmodified and in full force and effect (or, if
                           modified, stating the nature of such modification,
                           identifying the instruments of modification and
                           certifying that this Lease, as so modified, is in
                           full force and effect), and the date to which the
                           Base Rent, security deposit, Additional Rent and
                           other charges are paid in advance, if any, and (ii)
                           acknowledging that there are not, to Tenant's
                           knowledge, any uncured defaults on the part of
                           Landlord hereunder, or specifying such defaults, if
                           any, which are claimed. Any such statement may be
                           conclusively relied upon by any prospective
                           purchaser, encumbrance or other transferee of the
                           Premises.

                  (b)      Tenant's failure to deliver such statement within
                           such time shall be conclusive upon Tenant: (i) that
                           this Lease is in full force and effect, without
                           modification except as may be represented by
                           Landlord, (ii) that there are no uncured defaults in
                           Landlord's performance, and (iii) that no rent has
                           been paid in advance, and

                  (c)      If Landlord desires to finance or refinance the
                           Premises or the Building, or any part thereof, Tenant
                           hereby agrees to deliver to Landlord and/or to any
                           lender designated by Landlord such financial records
                           of Guarantor as may be reasonably required by such
                           lender. Such statements may include but not be
                           limited to the past three (3) years' financial
                           statements of Guarantor. All such financial
                           statements shall be received by Landlord in
                           confidence and shall be used only for the purposes
                           herein set forth.

         25.2     LANDLORD'S INTEREST AND LIABILITY. The term "Landlord" as used
herein shall mean only the owner or owners at the time in question of the fee
title or a tenant's interest in a ground lease of the real property on which the
improvements comprising the Building are situated. In the event of any transfer
of such title or interest, Landlord herein named (and in case of any subsequent
transfers the then grantor), shall be relieved from and after the date of such
transfer of all liability as respects Landlord's obligations thereafter to be
performed, provided that any funds in the hands of Landlord or the then grantor
at the time of such transfer in which Tenant has an interest shall be delivered
to the grantee. The obligations contained in this Lease to be performed by
Landlord shall, except as aforesaid, be binding on Landlord's successors and
assigns only during their respective periods of ownership. Anything to the
contrary elsewhere in this Lease notwithstanding, Tenant shall look solely to
the estate and property of the Landlord in the Building for the satisfaction of
the Tenant's remedies for the collection of a judgment (or other judicial
process) requiring the payment of money by the Landlord in the event of any
default or breach by the Landlord with respect to any of the terms, covenants
and conditions of the Lease to be observed and/or performed by the Landlord, and
no other property or assets of the Landlord shall be subject to levy, execution
or other enforcement procedure for the satisfaction of the Tenant's remedies.

         25.3     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.

         25.4     INTEREST ON PAST DUE OBLIGATIONS; CERTIFIED FUNDS. Except as
may expressly be provided in this Lease to the contrary, any amount due to
Landlord not paid within ten (10) business days of notice shall bear interest at
the rate of fifteen percent (15%) per annum from and after the date on which the
payment was first due through the date on which the payment is paid in full;
provided, however, that the payment of such interest shall in no event exceed
the highest rate allowed under applicable law. Payment of such interest shall
not excuse or cure any default by Tenant under this Lease. In the event that
either Tenant is more than ten (10) business days late after notice in making
any payment due under the Lease, or any payment from Tenant to Landlord does not
clear the bank or is returned for insufficient funds, and either such condition
occurs on two or more occasions, or each occurs once, Landlord shall have the
right at any time thereafter to require that all succeeding monthly installments
of Base Rent and all succeeding payments of Additional Rent be paid to the
Landlord in certified funds drawn on a bank located in the metropolitan area in
which the Premises are located. Said right may be exercised by Landlord by
giving notice of such requirements to Tenant, but the giving of such notice and
the exercise of this right by Landlord shall not be construed to be a waiver of
any default by Tenant or any other right which Landlord may exercise under this
Lease.

         25.5     TIME OF THE ESSENCE. Time is of the essence in the performance
by Tenant of its obligations hereunder.

<PAGE>   23
         25.6     CAPTIONS. Any captions contained in this Lease are not a part
hereof, are for convenience only, and are not to be given any substantive
meaning in construing this Lease.

         25.7     ENTIRE AGREEMENT. This Lease contains the entire agreement and
understanding between the parties hereto. There are no oral understandings,
terms, or conditions, and neither party has relied upon any representations,
express or implied, not contained in this Lease. All prior understandings,
terms, or conditions are deemed merged in this Lease. No modification of this
Lease shall be binding unless such modification shall be in writing and signed
by the parties thereto. Tenant acknowledges that it has not been induced to
enter into this Lease by any promises or representations not expressly set forth
in this Lease, and if any such representations were made prior to the execution
of this Lease, Tenant acknowledges that it has not relied on the same, and that
Landlord shall have no liability with respect to any such representations.

         25.8     WAIVERS. No failure by either party to insist upon the full or
timely performance of any agreement, term, covenant or condition hereof or to
exercise any right or remedy consequent upon a breach thereof, and no acceptance
of full or partial rent or the continuance of any such breach, shall constitute
a waiver of any such breach of such agreement, term, covenant or condition or a
relinquishment of the right to exercise such right or remedy. No agreement,
term, covenant, or condition hereof to be performed or complied with by either
party, and no breach thereof, shall be waived, altered or modified except by a
written instrument executed by the other party. No waiver of any breach shall
affect or alter the Lease, but each and every agreement, term, covenant or
condition hereof shall continue in full force and effect with respect to any
other then existing or subsequent breach thereof. Notwithstanding any
termination of this Lease, the same shall continue in full force and effect as
to any provisions of the Lease, including remedies, which require or permit
observance or performance of Landlord or Tenant subsequent to termination.

         25.9     RECORDING. Tenant shall not record this Lease. Any such
recordation by Tenant shall be a breach of this Lease.

         25.10    DETERMINATIONS BY LANDLORD. Whenever in this Lease the
Landlord is to make any determination or decision, the Landlord shall make its
determination or decision in the exercise of its reasonable discretion and
judgment; however, any such determination or decision shall not bind the
Landlord if it has not been confirmed in writing.

         25.11    CUMULATIVE REMEDIES. No remedy or election by Landlord
hereunder shall be deemed exclusive, but shall wherever possible be cumulative
with all other remedies at law or in equity to which Landlord may be entitled.

         25.12    COVENANTS AND CONDITIONS. Each provision of this Lease
performable by Tenant shall be deemed both a covenant and a condition.

         25.13    BINDING EFFECT; CHOICE OF LAW; PERSONAL JURISDICTION. Subject
to any provisions hereof restricting assignment, subletting or transfer by
Tenant and subject to the provisions of Section 25.2, this Lease shall bind the
parties, their personal representatives, heirs, successors and assigns. This
Lease shall be governed by the laws of the state of Colorado, and personal and
subject matter jurisdiction shall lie exclusively in the Twentieth Judicial
District of the State of Colorado courts. Tenant and any guarantors, assignees
or subtenants of Tenant hereby submit themselves to personal jurisdiction in
such Courts. TENANT (TOGETHER WITH TENANT'S GUARANTORS, ASSIGNEES, AND
SUBTENANTS) WAIVE THE RIGHT TO DEMAND TRIAL BY JURY IN ANY DISPUTE WITH LANDLORD
ARISING UNDER OR RELATED TO THIS LEASE OR TENANT'S OCCUPANCY OF THE PREMISES.

         25.14    ATTORNEYS FEES. In the event of litigation relating to this
Lease, the Court shall award the substantially prevailing party (as against the
substantially non-prevailing party) any costs or reasonable attorneys fees
incurred by the prevailing party in connection with such litigation.

         25.15    LANDLORD'S ACCESS. Upon not less than twenty-four (24) hours
prior notice to Tenant, Landlord and Landlord's agents, representatives and
designees shall have the right to enter the Premises during normal business
hours as reasonably necessary or desirable to Landlord for the purpose of
inspecting the same, showing the same to prospective purchasers, tenants,
lenders or other transferees, making such alterations, repairs, improvements or
additions to the Premises or to the Building as Landlord may deem necessary or
desirable (provided, however, as to any alterations, improvements, or additions,
such work by Landlord shall not materially adversely affect Tenant's use of
Premises), or for any other reasonable purpose as Landlord may determine. No
Notice shall be required for entry by Landlord in the event of an emergency. No
sooner than six (6) months prior to the termination of the Lease Landlord may
place in, on or about the Premises any "For Sale", or "For Lease" or similar
signs, all without rebate of rent or liability to Tenant.

<PAGE>   24
         25.16    AUCTIONS. Tenant shall not conduct any auction, liquidation
sale, or going out of business sale in, on or about the Premises.

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

         25.18    CORPORATE AUTHORITY. If Tenant is a corporation or other
business entity, each individual executing this Lease on behalf of said entity
represents and warrants that he is duly authorized to execute and deliver this
Lease on behalf of said entity in accordance with a duly adopted resolution of
the Board of Directors or other governing body of said entity or in accordance
with the Bylaws or Operating Agreement of said entity, and that this Lease is
binding upon said entity in accordance with its terms.

         25.19    SIGNS. Landlord may prescribe a uniform pattern of
identification signs for tenants to be place on the outside of the doors leading
into their respective premises, and other than such identification signs, Tenant
shall not install, paint, display, inscribe, place or affix, or otherwise
attach, any sign, fixture, advertisement, notice, lettering or direction on any
part of the outside of the Building or in the interior or other portion of the
Building without obtaining the prior written consent of the Landlord.

         25.20    BROKERS. The parties hereto acknowledge that the brokers named
in Section 1.18 were the sole real estate brokers, McBride and Company, LLC
representing Tenant and Colorado Group, Inc. represented Landlord, and that no
commission from any other brokers arising out of the execution of this Lease.

         25.21    GUARANTOR. In the event that there is a guarantor of this
Lease, said guarantor shall have the same obligations as Tenant under this
Lease.

         25.22    GOVERNING LAW. This Lease shall be governed by and construed
in accordance with the laws of the State of Colorado.

         25.23    JOINT AND SEVERAL LIABILITY. If two or more individuals,
corporations, partnerships or other business entity (or any combination of two
or more thereof) shall sign this Lease as Tenant, the liability of each such
individual, corporation, partnership or other business entities shall be deemed
to have been given or made by, with or to all of them. In like manner, if Tenant
shall be a partnership or other business entity, the members of which are, by
virtue of statute or federal law, subject to personal liability, the liability
of each such member shall be joint and several.

         25.24    NO JOINT VENTURE. Any intention to create a joint venture or
partnership relation between the parties hereto is hereby expressly disclaimed.

         25.25    ADDITIONAL TRANSACTION SPECIFIC TERMS.

                  (a)      DOCK MODIFICATIONS. This Lease is conditioned upon
                           the proposed modifications to the loading dock of the
                           Premises (as set forth in Exhibit D) being approved
                           by the City of Louisville, Colorado. Tenant and
                           Landlord shall cooperate in good faith in attempting
                           to obtain such approvals as soon as practicable upon
                           the execution hereof. All costs related to the dock
                           modification, (including without limitation,
                           engineering and architectural fees, permit and other
                           governmental fees, and construction costs) shall be
                           borne by Tenant and shall be paid by Tenant without
                           regard to whether such approval is obtained within
                           thirty (30) days of receipt of invoice therefor;
                           provided, however, that Tenant shall not be
                           responsible for the costs of such modification to the
                           extent that such costs exceed $140,000.

                  (b)      GUARANTEE. As more fully set forth in Exhibit C,
                           Tenant's obligations under this Lease shall be fully
                           and unconditionally guaranteed by Tenant's parent
                           corporation, EMC Corporation.

                  (c)      TENANT FINISH ALLOWANCE. As more fully set forth in
                           Addendum 3 and 4, Landlord shall provide a Tenant
                           Finish Allowance not to exceed Twenty-five Dollars
                           ($25.00) per useable square foot of the demised
                           Premises (Approximately 86,490 sq. ft. (Gross square
                           footage less common areas) as verified by architect.
                           Such tenant finish shall be provided for work
                           previously approved by Landlord as defined in a
                           mutually agreeable space plan for the Premises.
                           Landlord shall engage its architect and contractor to
                           provide

<PAGE>   25
                           construction drawings, cost estimates and complete
                           construction of such improvements, the costs for
                           which will be paid from the Tenant Finish Allowance
                           established hereunder. Any costs beyond the Tenant
                           Finish Allowance shall be paid within 30 days of
                           receipt of an invoice therefor by Tenant. At the
                           conclusion of Tenant's Work upon the Premises (as
                           determined by written notice supplied by Tenant to
                           Landlord), if there still exists any unused portion
                           of the total Tenant Finish Allowance provided for
                           herein, then, at Landlord's option, such unused
                           portion shall be (i) abated against Tenant's Base
                           Rent pro rata over a period up to the first twelve
                           (12) full months of the Lease following such written
                           notice, or (ii) shall be applied to the payment of or
                           for other improvements to the Premises to be or
                           already paid for by Tenant, including, without
                           limitation, loading dock modifications, cabling, or
                           other improvements, fixtures or accessions. The
                           determination of whether to apply such excess to any
                           such improvement or in part to improvements and in
                           part to rental abatement, shall be made in Landlord's
                           discretion, so long as the full amount of such excess
                           is applied to abatement and/or such improvements.
                           Payment for or on account of any such improvements
                           may be made directly to the
                           supplier/contractor/vendor, or if already paid by
                           Tenant, may be made directly to Tenant.

                           The Tenant Finish Allowance provided hereunder
                           contemplates improvements beyond "Warm Shell"
                           completion of the Premises by Landlord at Landlord's
                           own expense. Such improvements by Landlord include
                           completed Common Area improvements such as entries
                           and four sets of multi-stall restrooms in the office
                           tower portion of the building, as depicted on the
                           Master Plan for the Property. Furthermore, such Warm
                           Shell construction contemplates HVAC for a portion of
                           the building, with Evaporative Cooling and Unit
                           Heaters for the remaining portion of the building (as
                           shown on mechanical drawings for the Premises),
                           certain of which have yet to be installed. Should
                           tenant desire to upgrade such systems prior to their
                           installation, Tenant shall be provided with credit
                           for such systems that are not installed and any
                           excess cost shall be provided out of the Tenant
                           Finish Allowance.

                  (d)      COMPLETION OF COMMON AREAS. Common Areas of the
                           Property shall be completed at Landlord's expense,
                           except to the extent of improvements thereto
                           requested specially by Tenant.

                  (e)      ESTIMATED OPERATING EXPENSES. Triple Net Expenses for
                           the Premises are currently estimated at $2.25 per sq.
                           ft. for calendar year 2000, which amount includes
                           real estate taxes, hazard insurance, common area
                           maintenance and management. Such expenses do not
                           include expenses to be paid directly by Tenant such
                           as: gas and electric utilities; water, sewer and
                           flood control; trash removal; janitorial;
                           communications; and, phone services.

                  (f)      SATELLITE DISH. Tenant shall be permitted to install
                           on the roof a satellite dish; provided, however,
                           Tenant shall be responsible for and shall repair in a
                           workmanlike manner at Tenant's expense all roof or
                           exterior wall penetrations, any resulting leaks or
                           any other damage caused by or as a result of such
                           installation. Such installation shall be done in a
                           good and workmanlike manner and in compliance with
                           all applicable laws, ordinances and covenants. No
                           such installation shall be permitted to the extent it
                           would void any roof or structural warranty. Tenant
                           acknowledges that any other provision herein
                           notwithstanding, upon termination of Tenant's
                           occupancy Landlord may require, at Tenant's expense,
                           Tenant's removal of such dish and accompanying wiring
                           and workmanlike restoration and repair of any damages
                           resulting from such removal.

                  (g)      PROFESSIONAL PROPERTY MANAGEMENT. The Tenant may
                           self-manage the Premises or may hire a professional
                           property manager to perform the property management
                           for the Premises. All costs as a property manager
                           (which costs are a "pass-through" under Section 4.2
                           and 6.2) shall be paid by and are the responsibility
                           of the Tenant. Base Rent and Additional Rent in the
                           form of property taxes and the costs of insurance,
                           late charges, and any other expenses directly
                           incurred by the Landlord which are Additional Rent
                           shall be paid directly to Landlord by Tenant, but all
                           other Additional Rent shall either be paid directly
                           by the Tenant or shall be paid to the Tenant's
                           professional property manager. The Tenant and any
                           property manager hired by the Tenant agree to provide
                           to the Landlord monthly reports of property
                           management services provided by the Tenant or the
                           property manager and an itemization of all expenses
                           and costs incurred and paid in connection with that
                           property management. Landlord has the right, but
                           shall not be obligated to, inspect the Premises, upon
                           reasonable notice to the Tenant. Landlord reserves
                           the right to terminate the services of the

<PAGE>   26
                           Tenant, as a self-manager, or the property manager,
                           for failure to manage the Property in a quality
                           manner consistent with standards for comparable
                           quality properties in the geographic area and in a
                           manner deemed acceptable to the Landlord, in the
                           Landlord's reasonable discretion, and in accordance
                           with recommendations of the Landlord's agents.

         The parties hereto have executed this Lease on page eight (8) hereof on
the dates specified immediately below their respective signatures.

LANDLORD                                    TENANT

By: ___________________________             By:_____________________________

Title: ________________________             Title: _________________________

<PAGE>   27

                                    EXHIBIT A

                                LEGAL DESCRIPTION

         Lots 4, 5, and 6, Block 5, Colorado Technological Center, First Filing,
County of Boulder, State of Colorado.

<PAGE>   28

                                    EXHIBIT B

                               PREMISES SITE PLAN

<PAGE>   29

                                    EXHIBIT C

                                GUARANTY OF LEASE

         The Mills Family, LLC, a Colorado limited liability company
("Landlord") and McDATA Corporation, a Delaware corporation (as "Tenant"),
entered into that certain Commercial Lease Agreement dated as of November ,1999,
whereby Landlord leased to Tenant and Tenant leased from Landlord those certain
premises commonly known as 1722 Boxelder Avenue, Louisville, Colorado. Landlord
requires that EMC Corporation ("Guarantor) execute and deliver this Guaranty to
Landlord.

         NOW, THEREFORE, in consideration for Guarantor's business affiliation
with Tenant and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Guarantor agrees as follows:

         1.       Guarantor hereby absolutely, irrevocably and unconditionally
guaranties for the benefit of Landlord and its successors and assigns until the
Lease expiration date (three (3) years following the Commencement Date of the
Lease), the full and timely performance of each and all of the terms, covenants
and obligations of the Lease to be kept and performed by Tenant thereunder,
including, without limitation, payment of all rent, expenses and charges payable
by Tenant thereunder. If Landlord disposes of its interest in the Lease,
"Landlord," as used in this Guaranty, shall mean Landlord's successors in
interest and assigns. Guarantor's obligations hereunder shall not be assigned or
delegated.

         2.       No amendment to the Lease or any lease term extension shall be
binding on Guarantor unless prior written approval has been made by Guarantor.
Notwithstanding the foregoing, Guarantor waives approval of any amendment that
Landlord and Tenant may agree to prior to or after Date of Occupancy under the
Lease, provided any such amendment, singly or cumulatively with other
amendments, does not result in increases to Base Rent or Additional Rent of
$50,000 or more per year. In addition, no action which Landlord may take or omit
to take in connection with the Lease and no course of dealing with Tenant or any
other person (including, without limitation, any amendment or waiver of any
provisions of the Lease or any settlement of any amount due under the Lease),
shall relieve Guarantor's obligations hereunder, affect this Guaranty in any
way, or afford Guarantor any recourse against Landlord. To the extent
Guarantor's approval is required as to any amendment hereunder, notice thereof
shall be provided by certified mail to:

                  EMC Corporation
                  David Streeter, Real Estate Department
                  35 Parkwood Drive
                  Hopkinton, MA 01748

and Guarantor shall respond within three (3) business days after receipt of such
notice.

         3.       Subject to the notice requirements in the Lease, Guarantor
expressly waives notice of acceptance of this Guaranty, presentment for payment
or performance of the Lease, nonpayment or nonperformance of the Lease, protest
and notice of protest, demand, notice of dishonor, notice of any and all
proceedings to collect amounts due under such agreements and to enforce any
security given therefor, and diligence in collecting sums due under such
agreements or any liability under this Guaranty. Guarantor further waives the
following: (a) any defense by reason of any disability of Tenant; (b) any
defense arising out of the absence, impairment or loss of any right of
reimbursement, contribution, subrogation or any other rights or remedies of
Guarantor against Tenant, whether resulting from Landlord's election to exercise
certain rights or remedies it may have against Tenant, or otherwise; and (c) any
defense to the obligations of Guarantor under this Guaranty arising from any
bankruptcy proceedings against Tenant, including, but not limited to, those
arising from Landlord's exercise of its right to file a claim in such
proceedings, or the exercise of any trustee's powers under Federal Bankruptcy
Code Sections 364 and 365. Until all of Tenant's obligations to Landlord have
been discharged in full, Guarantor shall have no right of subrogation against
Tenant or the right to assert any defenses of Tenant under the Lease.

         4.       In the event of any default in the performance of Tenant's
obligations under the Lease, Landlord shall have the right to enforce its rights
under this Guaranty and/or its rights against Tenant, in any order, it being
agreed that all remedies available to Landlord under the Lease and this Guaranty
shall be nonexclusive. Landlord may enforce its rights under this Guaranty
without first proceeding against or joining Tenant or any other person, and
without applying or enforcing any security for the Lease. Guarantor hereby
waives any rights that Guarantor may have to compel Landlord to proceed against
Tenant or against any security from Tenant

<PAGE>   30
or to participate in any such security.

         5.       If Landlord is required to enforce Guarantor's obligations by
legal proceedings, Guarantor shall pay to Landlord all costs incurred,
including, without limitation, Landlord's reasonable attorney's fees and all
costs and other expenses incurred in any collection or attempted collection or
in any negotiations relative to the obligations hereby guaranteed, or in
enforcing this Guaranty against Guarantor.

         6.       This Guaranty shall be construed and enforced in accordance
with the laws of the State of Colorado. Guarantor hereby irrevocably consents to
the jurisdiction of the State of Colorado, and agrees that any court of
competent jurisdiction sitting in Boulder County, Colorado, shall be an
appropriate and convenient place of venue, and shall be the sole place of venue,
to resolve any dispute with respect to the Guaranty.

         IN WITNESS WHEREOF, Guarantor has executed this Guaranty as of the day
and year first written above.

                                      EMC Corporation
                                      (Guarantor)

                                      By:___________________________

                                      Name:_________________________

                                      Title:________________________

<PAGE>   31

                                    EXHIBIT D

                               DOCK MODIFICATIONS

<PAGE>   32

                                    EXHIBIT E

                          CORE AND SHELL SPECIFICATIONS

<PAGE>   33

                              THE MILLS FAMILY, LLC
                         BUILDING "SHELL" SCOPE OF WORK
                             Outline Specifications

                     GENERAL BUILDING & SITE SPECIFICATIONS

LOCATION:                                         Lots 4, 5 & 6, Block 5
                                                  Colorado Technological Center
                                                  Louisville, Colorado

TWO STORY OFFICE/ONE STORY WAREHOUSE

BUILDING SIZE:  Total Building Area:              91,497 SF
                First Floor           8,261SF
                Second Floor          23,236SF

SITE SIZE:                                        233,151SF
SITE COVERAGE:                                    29.2%
PARKING SPACES PROVIDED:                          250 Spaces
PARKING RATIO:                                    2.74/1000 SF
LANDSCAPE COVERAGE:                               27.9%
EXTERIOR LOADING DOCKS: 48" RECESSED DOCK:        4 each
AT GRADE/DRIVE IN OVERHEAD DOORS (10'X 12)
  CONCRETE PAVING:                                5 each
CONCRETE PAVING:                                  6" truck/dock/trash aprons
                                                  4" Sidewalks
ASPHALT PAVING:                                   6" @ drives/dock area
                                                  5" @ parking area
UTILITIES:                                        3" Water Service with
                                                     11/2" Meter
                                                  8" Fire Service
                                                  4" sewer
TILT-UP CONCRETE WALL CONSTRUCTION
FOUNDATION SYSTEM:                                Pad Footings
SLAB ON GRADE:                                    6" thick
CONVENTIONAL STEEL FRAMING
ROOF SLOPE:                                       1/4" per 12"

BAY SIZE:             Warehouse                   37'0" x 34'8"
                      Office                      27'9" x 26'0"
OFFICE CLEAR HEIGHT:  Warehouse                   16'0"
                      First Floor Office          14'0"
                      Second Floor Office         10'0"
CEILING HEIGHT:       First Floor Office          9'6" to 12'0"
                      Second Floor Office         8'6" to 9'0"
ROOF INSULATION:                                  R-19
WALL INSULATION:                                  R-10
ELEVATOR/ADA ACCESSIBILITY                        One per second story (2 each)
AUTOMATIC FIRE SPRINKLER SYSTEM                   CLASS I - IV
ELECTRICAL SERVICE:                               2000 amps, 3-phase, 480 volt

<PAGE>   34
DIVISION 1 - GENERAL REQUIREMENTS

-    Full time on-site Project Superintendent.

-    Project Management.

-    Construction Administration: Architect and Structural Engineer of Record.

-    Temporary facilities including project office, storage and sanitary
     facilities.

-    Temporary utilities including power, lighting, water, telephone and fax
     communication.

-    Job-site safety program including weekly toolbox talks, personal protection
     review, and a minimum of detailed biweekly on site inspections performed by
     an independent safety inspector in strict accordance with OSHA standards.

-    Daily clean up including trash container/dumpster fees.

-    Final cleaning of building including scrubbing and dust-proofing/sealing of
     the warehouse slab on grade, concrete pan stairs and landings; washing of
     all windows inside and out; wiping down of all doors, hardware, stair
     railings, elevator doors and cab finishes.

-    As-built record drawings marked up by field personnel. One set of
     reproducible drawings to be provided upon request.

-    Two sets of Owner Manual with copies of all building permits, inspection
     and test results, product literature, and operating and maintenance
     instructions.

-    TWO-YEAR written General Contractors warranty in lieu of the customary
     one-year warranty.

DIVISION 2 - SITEWORK

EARTHWORK:

-    Clear and grub site.

-    Install/maintain erosion control in accordance with State of Colorado NPDES
     requirements for a site over 5 acres. Prepare and submit Storm Water
     Management Plan to the State, and obtain permit on behalf of the Owner.

-    Provide vehicle tracking pads and a crushed concrete parking/staging area
     to minimize mud tracking onto the street.

-    Perform overlot grading and site cut/fills of approximately 8400 cubic
     yards of onsite material.

-    Complete structural excavation for foundation pads/ tilt-up walls,
     retaining walls, etc.

-    Scarify and moisture condition the subgrade a minimum of 8" underneath the
     perimeter pad footings and interior slab-on grade per Terracon soils report
     #25985281, dated October 30, 1999. Place and re-compact onsite moisture
     treated soils under the pad footings and slab on grade area, or at
     contractors option, import and place approximately 1 1/2 feet of structural
     fills underneath the pad footings, and 6"-12" underneath the interior
     slab-on-grade.

-    Moisture-condition and utilize onsite soils for backfill of foundation and
     tilt-up walls.

-    Demolition of existing city curb & gutter, and install three thirty-foot
     wide curb cuts.

SITE CONCRETE:

-    Onsite sidewalks, steps and handicap ramps shall be 4" thick
     fiber-reinforced concrete.

-    Onsite drive pans, curb chases, dock aprons and dock pad, trash pads and
     trash aprons shall be 6" thick fiber-reinforced concrete.

-    Onsite curb and gutter shall be unreinforced. Two stamped patterned colored
     concrete patio areas complete with one picnic table each.

-    Poured-in-Place concrete retaining walls complete with steel guardrail to
     provide four 48" deep exterior docks.

-    Thirteen concrete light pole bases and twelve bollard light support pads
     are included.

-    City concrete work to included 3 each thirty-foot wide, 10" thick
     fiber-reinforced concrete drives.

-    City sidewalk is excluded and is not required per the CTC Master Sidewalk
     Plan.

-    All exterior concrete shall be cured with white-pigmented water based
     membrane curing compound.

-    All exterior onsite and city concrete shall contain include 1-3%
     air-entrainment, and shall maintain a minimum of 3750psi concrete
     compressive strength.
<PAGE>   35
ASPHALT:

-    5" full-depth asphalt paving in the automobile parking stalls south of the
     north building line.

-    6" full-depth asphalt paving in the circulation drives and all paving north
     of the north building line.

-    Soils sterilant to be installed on the subgrade of asphalt paving to
     prevent/minimize organic growth.

-    Parking lot striping and handicap markings.

LANDSCAPING:

-    Complete soil preparation including roto-tilling compost into the
     landscaped areas at a rate of 3 cubic yards per thousand square-feet.

-    Furnish and install all plant materials per the City Council approved
     landscape plan including shrubs, deciduous and evergreen trees, perennial
     flowerbeds, native seed, and a 90% tall fescue/10% bluegrass blended sod.

-    Design and submit to the City for approval an automatic irrigation system
     using a drip-system for all trees and shrubs, and sprinkler irrigation for
     sod areas. The native seed areas will include a temporary irrigation system
     until such time seeding takes full growth.

-    Warranty all landscaping a minimum of twelve months or one full growing
     season cycle. Warranty to be extended to 24 months should the owner retain
     the original landscape subcontractor for yearly maintenance of the
     landscaping.

-    Furnish and install four bike racks.

SITE UTILITIES:

-    Provide a 2" water tap in the street with a 2" copper water service to 5'
     outside the building footprint. This will provide maximum flexibility for
     future tenant needs by only having to purchase a 1 1/2" water tap with the
     shell construction, while maintaining the underground capacity for either a
     1 1/2" or a 2" remote water meter. A 1 1/2" remote water meter has been
     provided.

-    Install an 8" fire service into the building fire riser room.

-    Install two new fire hydrants. Install a 4" sanitary sewer service from the
     street to 5' outside the building footprint.

-    Install two 18" diameter storm sewer taps, pipe and outlet structures at
     the detention pond. Install riprap run-down channel as designed.

-    Install two 15" diameter storm sewer outlet pipes from each truck dock
     directly to each detention pond. Connect the interior roof drain system
     over the warehouse area directly into an inlet in each truck dock area to
     drain the roof area through the 15" pipe to the detention ponds.

-    Provide concrete flowfill backfill material at all street cuts including a
     minimum of 9" full depth asphalt patch in the street per City of Louisville
     standards.

-    The owner will pay water and sanitary sewer tap fees direct.

TESTING/QUALITY ASSURANCE:

-    Field surveying and layout to be provided by a Registered Colorado
     Surveyor.

-    Terracon, acting as an independent testing agency, will be retained by the
     contractor on behalf of the owner and contractor to take samples as needed
     for testing of soils compaction and moisture, concrete flatwork, and
     asphalt to assure quality control and that the specifications have been
     met.

-    Test results will be forwarded directly to the owner, contractor's office
     and jobsite office trailer. Unless requested by the owner, sidewalks, curb
     and gutter, and the light pole bases will not be tested.

DIVISION 3 - CONCRETE FOUNDATIONS:

-    Reinforced interior/exterior concrete pad footings designed with maximum
     soils bearing pressure of 2000psf, and a minimum of 600psf minimum dead
     load.

-    Spread footings & poured-in-place retaining walls at the exterior loading
     docks.

-    Concrete strength for foundation pads to be a minimum of 3000psi, 28 day,
     compressive strength.

-    Sack and rub all poured-in-place concrete exposed to view prior to
     painting.

TILT-UP CONCRETE EXTERIOR WALLS:

-    71/4" reinforced concrete wall panels complete with reveals and insets to
     receive stone veneer after lifting.
<PAGE>   36
-    Concrete strength for tilt-up panels to be a minimum of 4000psi, 28 day,
     compressive strength.

-    Rub and patch honeycombed areas, and grind/ patch imperfections caused by
     slab contraction control joints/joint filler prior to priming panels.
     Examine panels after priming and repair blemished areas prior to painting
     panels.

-    Patch forming and bracing holes in the slab-on-grade.

-    Interior panel joint caulking and lifting device/bracing hole patching is
     excluded. These finishes will be completed, if necessary, in tenant finish
     phase should the tenant require the interior wall panels to be painted or
     finished.

SLAB ON GRADE:

-    Office and warehouse slab shall be 6" thick, 4,000psi concrete reinforced
     with 6x6, W2.9 x W2.9 welded wire sheet fabric tied to support chairs.
     Concrete to be pumped and placed with a laserscreed to maximize flatness of
     slab for casting of the tilt-up panels.

-    Slab to be soft-cut/sawcut following finishing as required to minimize
     cracking caused by shrinkage. Concrete dowels to be installed at all
     construction joints at approximately two-feet on center.

-    A standard water based curing/bond breaker compound will be applied after
     finishing for curing purposes only.

SECOND STORY DECK:

-    Mezzanine deck shall be 3" thick concrete, 3500psi concrete reinforced with
     6x6, W1.9 x WI.9 welded wire fabric.

-    Fill concrete steel pan steps and landings, and finish according to final
     exposed finish.

-    Concrete pumping and standard water based curing compound.

TESTING/QUALITY ASSURANCE:

-    Concrete slump tests and cylinder samples will be taken in the field at the
     rate of one test per 50 cubic yards, or a minimum of one test per pour
     should the quantity be less than 50 cubic yards, to assure compliance with
     concrete mix design and performance specifications.

-    Special inspections will be required by the uniform building code for
     tilt-up wall reinforcing.

DIVISION 5 - METALS

-    Roof structure will be framed utilizing conventional steel tube columns,
     truss girders, bar joists and 1.5B roof deck.

-    Wide-flange beams will be utilized to frame the stair and elevator floor
     openings, and the raised architectural roof features at the three entries.

-    The mezzanine will be framed with tube steel columns, wide flange beams,
     bar joists and floor deck.

-    Miscellaneous steel includes three steel canopies, roof deck support and
     mezzanine concrete screed angles, bearing plates, anchor bolts, elevator
     sill angles, roof frames for roof top units, swamp coolers, three roof
     hatch openings with one roof access ladder each.

-    Four sets of interior steel pan stairs are included. The lobby stairs will
     be open to the second floor with an architectural handrail system being
     provided for the two main office stairs. The secondary access stairs will
     be installed in a drywall stairwell enclosure with standard wall mounted
     pipe rail handrail.

-    Miscellaneous steel for the site includes four sections of guardrail on top
     of the dock ramp retaining walls, one 8" channel at each of the four dock
     slabs for future installation of an edge-of-dock leveler (based on tenant
     needs). 6" diameter x 7'0" long guard posts at the interior/exterior of the
     grade access overhead doors, and at the back of the trash enclosures. Two
     pair of steel framed trash enclosure access gates with roof decking as the
     sheeting for the trash company/dumpster access, and one single pedestrian
     gate per trash enclosure at the rear will be provided.

-    Steel erection and installation of above materials.

-    Special inspections will be required for bolt and weld examination as
     required by the 1997 Uniform Building Code, and monies are included in
     estimate.

DIVISION 6 - CARPENTRY

-    Backing and blocking material as required for elevator rails, handrails,
     restroom toilet partitions/accessories, restroom counters, and parapet
     cornice backing.

-    Plywood decking over the metal roof deck at the entry architectural roof
     areas to provide attachment for the architectural metal roofing.
<PAGE>   37
-    4' x 8' plywood phone board in the electrical room.

-    Plastic laminated countertops with back-splash for each of the restroom
     counter mounted lavatories.

-    Carpentry labor for installation of above materials.

DIVISION 7 - THERMAL AND MOISTURE PROTECTION INSULATION:

-    The perimeter of the site cast panels will be covered with a R-10
     shrim-reinforced vinyl faced insulation from 10' above finished floor in
     the warehouse areas, and from the tenant selected acoustical ceiling height
     to the second floor and roof deck.

-    The foundation will be insulated with a 2" closed-cell rigid insulation a
     minimum of two-feet below finished floor.

-    The membrane roof will be insulated under the roof membrane with 2.6" of
     R-19 isocyanurate rigid insulation. The roof drainage will occur from
     sloping of the structural steel and polystyrene crickets at roof drain
     areas.

-    The second-story office exterior metal stud wall framing on the north wall
     will be insulated with an R-13 foil-faced wall insulation. The stairwells,
     elevator equipment rooms, restroom walls and ceilings, electrical room, and
     fire riser room will be insulated with sound attenuation batts.

-    All other insulation to be installed during tenant finish.

ROOFING:

-    The membrane will be 45-mil thick EPDM roofing membrane manufactured by
     Firestone or Goodyear, and shall be installed over the rigid insulation
     noted above. The membrane will be held down by rock ballast with a minimum
     of 15 lbs./SF of rock around the perimeter (as required for high wind
     areas), and I 0-lbs./SF minimum at the interior of same roof.

-    The architectural metal roofing will be 24 gauge, 20-year Kynar-500
     pre-finished painted standing seam panels in a standard color, applied over
     the plywood decking.

-    The cornice material will be the same pre-finished Kynar-500 as the
     architectural roof. If a different color is desired by the owner, it will
     most likely require the material to be a Paint-loc or galvanealed material
     to be field painted to match.

-    Overflow scupper and miscellaneous flashing material.

-    The roof and associated flashings shall carry a 15-year manufactures
     material warranty, with a two year subcontractors weathertightness labor
     warranty.

-    Three 2'6" x 3'0" Bilco S-20 roof hatches with safety extension posts.

-    Approximately 320 roof pavers have been included to provide a landing pad
     at the roof hatch, and to provide access to the roof mounted equipment
     requiring service to minimize foot traffic directly on the roof membrane.

DIVISION 8 - DOORS, WINDOWS, GLAZING

Aluminum Storefront and Glazing:

-    Exterior window and storefront entrance systems to be Southwest Aluminum
     with 50% Kynar-500 pre-finished metal in a custom color of the owner's
     choice. Kawneer Trifab II 451 Aluminum may be utilized if bronze or black
     color is selected, or a small additional cost may be incurred for standard
     colored frames.

-    Storefront doors to be narrow style with 1/4" bronze or light gray tempered
     glass.

-    Hardware will include offset pivot hinges, surface mount closures, panic
     exit devices, exterior pull handles, and threshold/door bottom sweeps.

-    Glazing to be bronze or light gray 1" insulated thermally broken glazing
     units.

-    A reflective type or heat mirror type glass will be used on the south and
     west exposures to minimize heat gain from these exposures.

-    Mirrors have been included over the counter in four pairs of restrooms.

DOORS AND HARDWARE:

-    Hollow metal welded steel frames will be cast in the tilt-up concrete
     panels at the perimeter of the building as shown, including entrances into
     the fire riser and electrical service rooms. Insulated hollow metal doors
     will be installed at the building exterior.

-    Hollow metal knock down steel frames/doors have been included for interior
     electrical room door, the elevator equipment room doors, the secondary
     stairwell upper/lower doors. The four sets of interior 1st and 2nd floor
     restroom doors can be hollow metal or stained wood doors.
<PAGE>   38
-    Hardware on exterior doors will include 11/2 pairs of NRP hinges, Sargent
     9-line heavy-duty commercial-grade ADA accessible lever locksets, closures,
     thresholds, weather-stripping and door sweeps.

-    The interior elevator equipment openings will be one-hour rated with
     associated hardware.

-    The restrooms will be equipped with push/pull hardware complete with kick
     plates and closures.

-    Locksets and storefront cylinders will be keyed alike to fit with the
     master keying. The tenant will be required to re-key to a sub-master key
     system.

OVERHEAD DOORS:

-    Five 24 gauge, chain hoist manually operated steel sectional pre-finished
     sandwich insulated preengineered overhead doors with exterior/interior
     steel finish, slide lock, and high-lift track features. The doors will be
     painted to match the exterior finish.

DIVISI0N 9 - FINISHES

DRYWALL & METAL STUD FRAMING SYSTEMS:

-    3 5/8", 20 gauge metal studs @ 16"oc. will be installed at the north
     second-story office wall, the north side and knee walls at the
     architectural roof entry features to provide the exterior wall. These are
     the only exterior walls that are not tilt-up. The exterior will be finished
     with a stucco product.

-    3 5/8", 20 gauge metal studs @ 16"oc. will be installed for the interior
     room walls including the electrical/fire riser rooms, the elevator
     equipment rooms, four sets of men/women restrooms, and the north two
     stairwells. The elevator equipment room will be one-hour rated per code.

-    The elevator shafts will be a shaft wall or like system with adequate
     support for the elevator rails.

-    The restroom ceilings will be framed with 6" metal studs at 24"oc.

-    5/8" type-x drywall will be utilized for all walls except the restroom
     walls, which will be green board as required for wet areas. The restroorn
     ceilings and exterior drywall will be exterior soffit board.

PAINTING:

-    Exterior tilt-up and pour-in-place retaining walls will be primed with a
     Loxon or equal primer, and painted with one coat of a flat latex paint. A
     textured finish may be applied on the tilt-up panels south of the north
     two-story office line.

-    Hollow metal doors/frames, trash enclosure gates, exterior bollards, bike
     racks, guardrails, and other ferrous metals shall be painted with two coats
     of oil enamel.

-    Overhead doors will be painted with latex satin. Entrance canopies to be
     painted with flat latex.

-    Interior drywall surfaces will be taped, sanded and ready for paint except
     at the interior of the elevator equipment rooms, the north stairwells, and
     four pairs of restrooms, which will be primed and painted with two coats of
     paint.

-    Stucco will be painted to match tilt-up.

STUCCO:

-    An Exterior Insulation Finish System (E.I.F.S.) stucco will be installed
     over an exterior soffit board at the north office wall and closure at the
     north wall and knee walls of the architectural entry roof systems.

SYNTHETIC OR NATURAL FLAGSTONE:

-    An allowance of $8.00/SF has been included for material/labor for the
     inlaid areas in the tilt-up wall panels.

CERAMIC TILE:

-    An allowance of $8.00/SF of floor area and $7.50/SF of wall area has been
     included to provide a 2"x2" ceramic floor tile with a 6" ceramic base, and
     4"4" wainscot tile to 4'4" per code has been included for 4-pairs of
     restrooms.

DIVISION 10 - SPECIALTIES TOILET PARTITIONS/ACCESSORIES:

-    Five powder-coated, head-rail braced toilet partition compartments and one
     urinal screen have been provided for each of the four office-pairs of
     restrooms. Manufacturer to be Global Steel Products or equal.

-    Stainless steel recessed toilet paper holders, combination toilet paper
     with sanitary waste compartments (women's), grab bars at handicap stalls,
     recessed paper towel/waste and liquid counter mount soap dispensers have
     been provided for in each restroom

<PAGE>   39
     bank. Manufacturer to be Bradley or equal.

SIGNAGE:

-    An allowance of $ 750.00 has been included for room identification signage
     including electrical room, fire riser room, elevator equipment rooms, the
     men's/women's restrooms, and the exterior building address on the building.

-    An allowance $2,000.00 has been included for each monument sign foundation
     and base. Sign identification letters are excluded.

DIVISION 11 - EQUIPMENT

-    One embedded channel at each exterior 48" dock-high loading dock for edge
     protection/future installation of Edge-of-Dock Leveler.

-    One pair of dock bumpers for each dock.

-    Knox box for fire department access.

DIVISION FOURTEEN - CONVEYING SYSTEMS

-    Two 2500 lb. capacity, two-stop, holeless jack hydraulic elevators.

-    Doors/jambs to be #4 satin or #8 polished stainless steel finish.

-    Plastic laminate cab walls with stainless steel handrails and an upgraded
     down-light ceiling system. Flooring to be installed with tenant finish to
     match finishes.

-    Each elevator will be supplied with a set of moving pads to protect the
     interior finishes during tenant moving operations. A 90-day maintenance
     contract is included with the base installation contract.

DIVISION 15 - MECHANICAL

PLUMBING SYSTEMS:

     SANITARY SEWER/ROOF DRAINAGE

     -    Under floor 4" PVC sanitary sewer with clean-outs per code from 5'0"
          outside the building footprint, running the width of the building and
          tying into the fire riser room and four sets of restrooms. The sewer
          main will be installed a minimum of 24" deep to provide flexibility
          for future plumbing during tenant finish. Tenant finish plumbing will
          require cutting the slab to install, which cannot be avoided due to
          the unknown tenant requirements.

     -    Above floor NHCI cast iron waste/vent piping.

     -    Above floor NHCI cast iron roof drain piping from 16 roof drains at
          the north warehouse/dock area tying into the exterior 15" dock storm
          sewer piping. Overflow will be by scuppers.

DOMESTIC WATER

-    The 1 1/2" domestic water meter has been sized based on providing four sets
     of large restrooms in two story portion of building, four electric water
     heaters, thirteen floor drains, four showers adjacent to restroom banks,
     two janitor mop basins, two drinking fountains, eight swamp cooler hookups,
     and two exterior hose bibbs.

-    The water service will be installed as a 3" from the street to 5'0" outside
     the building footprint as outlined in the Division Two for maximum
     flexibility for tenant improvements.

-    Water piping from the 3" water service 5'0" outside building footprint to
     the 11/2" remote water meter with a backflow-preventor and pressure
     reducing-valve installed in the fire riser room.

-    Overhead I 1/2" copper water piping to each of four restroom banks.

-    1 1/2" irrigation stub

GAS PIPING

-    Piping to five separate meters to packaged rooftop units and unit heaters.

MECHANICAL SYSTEMS:

<PAGE>   40
     HEATING AND COOLING

     -    Heating and cooling at the rate of 350 SF/Ton for the second story
          offices. The footprint or the second-story has been projected downward
          to the first floor, with the same cooling capacity. A total of 60 tons
          of cooling has been anticipated for these areas with four 15-ton
          units.

     -    Heating and cooling at the rate of 350 SF/Ton for the front 34'8" Bay
          of potential first floor offices between the office towers. A total of
          18 tons of cooling has been anticipated at this area.

     -    Each roof top unit will be equipped with VVT control capability. The
          units are installed on the roof with drops ducted to the first floor,
          and through the deck only at the second floor. Distribution will occur
          under the tenant finish stage.

     -    Cabinet heaters at the three main entrances will be installed during
          the tenant finish stage.

     -    Electric heaters have been provided in each shower room.

     -    Gas-fired unit heaters have been provided at the remaining
          warehouse/manufacturing areas to maintain a minimum of 55 degrees. An
          electric unit heater has been provided for the fire riser room.

     -    Cooling in the warehouse/manufacturing areas have been anticipated
          with industrial-type swamp coolers. Mechanical relief venting is not
          included, and relief can be accomplished by opening overhead or
          mandoors.

     -    The structural steel in the warehouse will be designed to accommodate
          the additional roof top units in the event they are required in the
          warehouse area.

     -    Start up is included, however, balancing by a certified balance
          subcontractor will occur during the tenant finish phase.

     VENTILATION

     -    Roof mounted exhaust has been anticipated for two upper/lower
          restroorn banks with time-clock controls

     -    Ventilation for each of the elevator equipment rooms including
          one-hour fire/smoke dampers per code.

     FIRE SPRINKLER SYSTEM:

     -    Automatic Fire Sprinkler System per NFPA 13 in the office areas for
          light hazard use. Design in warehouse area is in accordance with NFPA
          #231C for Class I-IV, storage height not to exceed 15'. Rack layout
          anticipates 8' minimum isles widths. In rack sprinklers are not
          required if above constraints are met.

     -    Smoke and Heats venting has been provided per Article #81 of the
          Uniform Fire Code.

     -    Drops will be installed with semi-recessed heads in the fire riser
          room, elevator equipment rooms, restrooms and stairwells.

DIVISION 16 - ELECTRICAL

     Main Service and Distribution Panels

     -    2000 amp 277/480 volt 3 phase electrical service with GFI main
          disconnect and bussed gutter.

     -    200 amp, 277/480-volt house panel, and 150 amp, 120/208-volt house
          panel.

     -    45 KVA step down transformer

     SITE ELECTRICAL

     -    Secondary feeders from the transformer located on the west property
          line

     -    Eleven each single head and two each double head 250 watt metal halide
          pole lights on twenty foot high light poles. Five each 250 watt metal
          halide shoebox cutoff wall packs at the truck dock loading areas.

     -    Twelve 36" tall bollard lights, and ten decorative wall sconces at the
          front entry area.

     -    Control for exterior lighting to be photocell on, time clock off.

     -    Two each 4" Telephone conduits from the west telephone pedestal to the
          telephone board.

     -    Five each 120 volt GFI weatherproof duplex outlets (one at each
          monument sign and each double pole light).

     -    One ground mounted 100-watt metal halide ground mounted fixture for
          each side of each monument sign.

     POWER

     -    Fourplex for telephone board and duplex for irrigation controller

     -    Two elevator hookups including shunt-trip breakers and per code.

     -    Fire riser flow/tamper switch hook up with exterior horn/strobe.

     -    Ten roof top HVAC units, unit heaters, electric heaters in the shower
          areas, swamp coolers and ventilation fans. Power

<PAGE>   41
          for VAV control boxes to be provided in the tenant finish phase.

     -    One GFI duplex outlet per bathroom and elevator equipment room.

     CONDUITS

     -    Two 3" PVC underground power conduits and Two 2" phone conduits capped
          6" above finished floor for future power and telephone shall buried to
          each elevator equipment room or janitor closet, and one 3" PVC and one
          2" conduit to each warehouse restroom area; to provide future
          power/telephone for the upstairs office, downstairs office, and to
          each warehouse area. A total of six 3' and six 2" conduits have been
          provided.

     LIGHTING

     -    Fluorescent wrap lighting with switch control at each restroom.

     -    Fluorescent lighting with switch control at rear stairwells,
          electrical and fire riser rooms, and the elevator pit and equipment
          rooms.

     -    No other interior lighting has been provided.

     FIRE ALARM

     -    One addressable, expandable alarm panel with 16 homs/strobes. An
          addressable alarm panel will provide maximum flexibility for future
          tenant finishes, and will indicate by a specific address the location
          of the alarm in multiple tenant situations.

     -    Hook up flow and tamper switches, and the fire/smoke dampers to the
          elevator equipment room.

     -    Provide smoke and rat-of-rise detectors at the elevator shaft and
          elevator equipment room per code.

     -    Hook up duct detectors at each roof top unit that exceeds 2000cfm per
          code.

     -    Monthly monitoring including the dialer shall be the responsibility of
          the owner.

OWNER FEES TO BE PAID DIRECT

     -    Water Tap Fee         1 1/2" Meter    $31,300.00

     -    Irrigation Tap Fee    3/4" Meter      $9,000.00

     -    Sewer Use Fee         1 1/2" Meter    $15,600.00

     -    Public Service Fees

     -    US West Fees

     -    Builder's Risk Insurance

     -    Payment and Performance Bond

     -    Building Permit/Plan Check Fees/`Use Taxes

CLARIFICATIONS AND EXCLUSIONS

     -    De-watering

     -    Perimeter Drain

     -    Over-excavation/rework of existing soils other than required for
          overlot grading

     -    Over-excavation of unsuitable/contaminated soils or import/haul off
          other than specified above

     -    Street Lights

     -    Fire Extinguishers and/or cabinets

     -    Interior demising walls, smoke and heat vents, draft curtains

     -    Fire Pump

     -    Interior finishes other than specified

     -    Hard or soft surfaced path in railroad easement

<PAGE>   42

                                    EXHIBIT F

                     ESTIMATED OPERATING EXPENSE BUDGET 2000

                                1722 Boxelder St.
                                       CTC
                                  2000 Estimate

           EXPENSE                                     COST PER SQ. FOOT

           Property Taxes                                      $ 1.29
           Hazard Insurance                                    $  .20

           ESTIMATED TOTAL                                     $ 1.49

All other operating expenses are to be paid directly by Tenant.

<PAGE>   43

                                   ADDENDUM I

                 COMMENCEMENT DATE AND EXPIRATION DATE ADDENDUM

         Pursuant to paragraphs 1.7 and 3.2 of the Commercial Lease between The
Mills Family, LLC, Landlord and McDATA Corporation, Tenant, the parties hereby
certify that the Commencement Date under this lease shall be ___________, __,
2000 and, unless terminated or extended as provided in the lease, the Expiration
Date of this lease shall be _____________, 2003.

LANDLORD                                        TENANT

The Mills Family, LLC                           McDATA Corporation
A Colorado Limited Liability Company

BY: ________________________________            BY: ____________________________

Title: _____________________________            Title: _________________________

<PAGE>   44

                                   ADDENDUM 2

                               RECORDED COVENANTS<PAGE>   1

                                                                   EXHIBIT 10.17

                          COSMOPOLITAN CORPORATE CENTRE
                                    PHASE II

     THIS INDENTURE made (in quadruplicate) the 28th day of May, 1997.

BETWEEN:

                             1211486 ONTARIO LIMITED

                         (herein called the "Landlord")

                                                               OF THE FIRST PART

                                     - and -

                               MCDATA CORPORATION

                          (herein called the "Tenant")

                                                              OF THE SECOND PART

          WITNESSETH that in consideration of the rents, covenants and
     agreements hereinafter reserved and contained, the Landlord and the Tenant
     covenant and agree as follows:

1.   PREMISES - The Landlord hereby leases to the Tenant those certain premises
     known as Suite No. 1000 (the "Premises"), contained in the building known
     as "Cosmopolitan Corporate Centre - Phase II" (the "Building"), situate on
     the lands having a municipal address of 111 Gordon Baker Road, North York,
     Ontario and which lands are more particularly described in Schedule "A"
     hereto annexed (the "Phase II Lands").

     The Premises comprise:

          (i)  10th floor of the Building and contain a Rentable Area of 16,410
               square feet; and, more particularly, shown for the purpose of
               identification only and not by limitation or enlargement, as
               being outlined in red on Schedule "B" hereto annexed. The
               Premises shall exclude all structural elements of the Building
               and all pipes, wires, ducts shafts and other installations
               therein forming part of the original base building mechanical
               system, but the Premises shall include all leasehold
               improvements, trade fixtures, additions, installations (other
               than those specifically excluded above) and partitions therein.

<PAGE>   2

2.   TERM - To have and to hold the Premises for and during the term
     (hereinafter called the "Term") of two (2) years to be computed from the
     1st day of August, 1997 and from thenceforth next ensuing and fully to be
     completed and ended on the 31st day of July, 1999 subject to the existing
     tenant surrendering vacant possession of the Leased Premises.

3.   RENTAL - Yielding and paying therefor yearly and during the period from the
     1st day of August, 1997 to the 31st day of October, 1998 unto the Landlord,
     its successors and assigns, the sum of fifty-seven thousand four hundred
     and thirty-five dollars ($57,435 dollars) of lawful money of Canada, to be
     payable, in advance in equal monthly instalments of four thousand seven
     hundred and eight dollars and twenty-five cents ($4,786.25) each on the
     first day of each month during the Term to the Landlord. The first of such
     instalments to be paid on the 1st day of August, 1997. If the Term
     commences on any day other than the first or ends on any day other than the
     last day of the month, rent for the fractions of a month at the
     commencement and at the end of the Term shall be adjusted pro-rata. The
     foregoing rental is based upon $3.50 per square foot per annum times the
     Rentable Area of the Premises of 16,410 square feet. Yielding and paying
     therefor yearly and during the period from the 1st day of November, 1998 to
     the 31st day of July, 1999 unto the Landlord, its successors and assigns,
     the sum of one hundred and six thousand six hundred and sixty-five dollars
     ($106,665 dollars) of lawful money of Canada, to be payable, in advance in
     equal monthly instalments of eight thousand eight hundred and eighty-eight
     dollars and seventy-five cents ($8,888.75) each on the first day of each
     month during the Term to the Landlord. The first of such instalments to be
     paid on the 1st day of November, 1998. If the Term commences on any day
     other than the first or ends on any day other than the last day of the
     month, rent for the fractions of a month at the commencement and at the end
     of the Term shall be adjusted pro-rata. The foregoing rental is based upon
     $6.50 per square foot per annum times the Rentable Area of the Premises of
     16,410 square feet.

     Provided that in the event of default, interest shall accrue and be payable
     by the Tenant on arrears of rent and all other amounts payable hereunder at
     the rate, per annum, equal to Royal Bank of Canada's prime commercial
     lending rate of interest in effect in Canada, from time to time, plus four
     per cent (4%). Such interest shall be calculated and compounded monthly
     from the time such rental arrears and other amounts first become due and
     payable until such rental arrears and amounts and all interest thereon are
     paid in full by the Tenant.

4.   DEFINITIONS - In this lease the following terms shall have the following
     meanings ascribed to them:

     (a)  "TOTAL MAINTENANCE COST" means the total amount of all costs, expenses
          or amounts incurred, whether by the Landlord or others on behalf of
          the Landlord, in connection with the complete maintenance, operation,
          management and repair of any of:

          (i)   the Premises and the Building of which the Premises form part;
          (ii)  the Common Inside Areas and Common Outside Areas and Facilities
                (both as hereinafter defined); and
          (iii) other items, components and improvements used or enjoyed by the
                Tenant in common with others including without limiting the
                generality of the foregoing all fixtures, fittings, lights,
                boilers, pipes, plant machinery, elevators, elevator shafts,
                heating and air-conditioning equipment, lobbies, entrances,
                stairs, passages, washrooms, walls, fences, gutters, drains,
                walkways, driveways, parking areas (whether surface, underground
                or podium, covered or uncovered), ramps, shipping and receiving
                areas, flower beds, lawns and other areas situate within the
                limits of the Phase II Lands;

                                       2

<PAGE>   3

          which shall include, without limiting the generality of the foregoing
          and without duplication, the cost of all repairs and replacements
          required for such operation and maintenance; all costs in respect of
          any heating, ventilating and air-conditioning equipment; all capital
          expenditures made by the Landlord in an effort to promote energy
          conservation as set out in paragraph 5(v) of this lease; the cost of
          operating and maintaining elevators; the cost of providing hot and
          cold water; depreciation (in accordance with generally accepted
          accounting principles from time to time) of all capital and
          maintenance equipment which by its nature requires periodic
          replacement including all heating, ventilating and air-conditioning
          equipment; the cost of electricity and public utilities including
          lighting not otherwise charged to tenants; the cost of snow, ice and
          refuse clearance and removal; parking lot maintenance, repairs and
          striping, landscape maintenance and window cleaning; the cost of
          insuring the Building of which the Premises form part for the full
          cost of reinstatement against loss or damage on an "all risks" basis
          (including flood and earthquake), boiler and machinery insurance,
          public liability insurance and loss of rental income insurance;
          accounting costs incurred in connection with preparation of statements
          and opinions for tenants and the reasonable cost of collecting
          payments of all amounts payable by tenants; the cost of providing
          janitor and security service and security devices for the Premises and
          the Building such as are in keeping with maintaining the standard of a
          prestige office building; the cost of all rental equipment and
          building supplies used by the Landlord for all such operations and
          maintenance or any other purpose; amounts paid on service contracts;
          the amount of all salaries, wages and benefits paid to or on behalf of
          persons engaged in cleaning, supervision, maintenance, operation,
          management and repair; any business taxes which may be imposed on the
          Landlord by reason of its operation of the Building or parts thereof;
          any management fees or charges of managing agents, or the Landlord's
          charges in lieu thereof if the Landlord undertakes management of the
          Building (which charges shall be an amount per year equal to four
          percent (4%) of the gross income, including all rent, additional rent
          and parking and storage rent of the Building).

          Total Maintenance Cost shall not include interest on the Landlord's
          debt or capital retirement of debt or amounts directly chargeable to
          capital account. In calculating Total Maintenance Cost, if less than
          ninety-seven percent (97%) of the Building is occupied by tenants
          (including the Tenant), then the amount of such Total Maintenance Cost
          shall be deemed to be increased to an amount equal to the amount of
          Total Maintenance Cost which would have been incurred had ninety-seven
          percent (97%) of the Building been occupied by tenants throughout the
          entire period for which Total Maintenance Cost is being calculated.

          With respect to any such costs, expenses or amounts incurred on other
          parts of the Complex, the Landlord shall have the right from time to
          time to reasonably allocate and reallocate such costs, expenses and
          amounts among the Building and the Phase II Lands and any and all
          further phases or portions of the Complex built from time to time, and
          the amount so allocated to the Building and the Phase II Lands shall
          constitute part of Total Maintenance Cost.

     (b)  "PROPORTIONATE SHARE" means the fraction which has as its numerator
          the Rentable Area (which includes, in the case of premises forming
          part only of a floor of the Building, the Additional Area as
          hereinafter defined) of the Premises and has as its denominator the
          Total Rentable Area of the Building whether rented or not, subject

                                       3

<PAGE>   4

          only to the adjustments which follow. The "Total Rentable Area of the
          Building" shall be calculated as if the Building were entirely
          occupied by tenants renting whole floors, and shall be the total of
          the Rentable Areas of all premises leased or set aside from time to
          time by the Landlord for leasing in the Building, but excluding
          parking and storage areas and areas housing building systems, and
          shall include the areas of all corridors, lobbies and other areas from
          time to time set aside by the Landlord for common use on all floors of
          the Building (excluding those common areas at the ground level of the
          Building, such entrance lobbies and other areas from time to time
          designated by the Landlord). The calculation of the Total Rentable
          Area of the Building whether rented or not has been determined upon
          completion of the Building and shall be adjusted from time to time to
          give effect to any structural or functional change affecting same. The
          calculation of the Rentable Area of the Premises shall be adjusted
          from time to time to give effect to any change therein during the
          Term. Provided that if any tenant, pursuant to its lease or otherwise,
          performs at its own cost any service or aspect of those items the cost
          of which would normally constitute a part of Total Maintenance Cost,
          then the Landlord shall alter the above fraction for such services or
          aspects as may be necessary to provide equitable distribution of Total
          Maintenance Cost among the tenants provided with the said services.

     (c)  "RENTABLE AREA" means:

          (i)  for Premises which comprise the whole of a floor of the Building,
               all areas within the outside walls on such floor. The Rentable
               Area for whole floor Premises shall be computed by measuring to
               the inside surfaces of the glass outer building walls, without
               deduction for columns and projections necessary to the Building,
               but shall not include stairs, elevator shafts or mechanical ducts
               supplied by the Landlord for use in common with other tenants in
               the Building;

          (ii) for Premises which comprise part of a floor of a Building, all
               areas occupied by the Tenant on such floor. The Rentable Area for
               part floor Premises shall be computed by measuring from and to
               whichever of the following form the boundaries of the Premises:
               the inside surface of the glass outer building walls; the centre
               of partitions which separate the Premises from adjoining rentable
               or service areas; and the office side of corridors or other
               permanent partitions; all without deduction for columns and
               projections necessary to the Building; but shall not include
               stairs, elevator shafts or mechanical ducts supplied by the
               Landlord for use in common with other tenants in the Building.

               In calculating the Rentable Area for part floor Premises, the
               area of the Premises, as calculated in accordance with the
               foregoing formula, shall be increased by an area (the "Additional
               Area") equal to the fraction of the total area of the corridors
               (measured to the corridor side of the corridors), elevator
               lobbies, service elevator lobbies, toilets, air-conditioning
               rooms, fan rooms, janitor's closets telephone and electrical
               closets and other closets serving the Premises in common with
               other premises on such floor, which fraction has its numerator
               the Rentable Area of the Premises (calculated in accordance with
               the foregoing formula but without addition of the Additional
               Area), and has as its denominator the sum of all Rentable Areas
               of all premises, (calculated in accordance with the foregoing
               formula but without addition of the Additional Area), including
               the Premises, on such floor. The common areas at the ground level
               of the Building, such as entrance lobbies and other areas from
               time to

                                       4

<PAGE>   5

               time designated by the Landlord, shall be excluded from the
               foregoing calculations.

               The Landlord shall cause the Landlord's Architect to measure and
               certify the Total Rentable Area of the Building and the Rentable
               Area of the Premises, prior to, or as soon as reasonably possible
               after, the commencement of the Term, and thereafter from time to
               time, as may be appropriate, throughout the Term. Such
               certificates issued by the Landlord's Architect shall be provided
               to and be conclusive and binding upon the Tenant. Any necessary
               adjustments to the rent, as a result of such certificates, shall
               be confirmed in writing by the parties.

        (d)  "LANDLORD'S ARCHITECT" means a qualified architect, engineer or
             Ontario Land Surveyor from time to rime retained, chosen or
             employed by the Landlord.

        (e)  "COMMON OUTSIDE AREAS AND FACILITIES" means the walls, fences,
             gutters, drains, parking areas (whether surface, underground or
             podium, covered or uncovered), shipping and receiving areas,
             driveways, walkways, flower beds, lawns and other areas situate
             within the limits of the Phase II Lands, ramps and other common
             outside areas in or about the Building as may from time to time be
             designated by the Landlord for the use or benefit of customers
             while visiting the Building or for the purpose of ingress to or
             egress from the Premises, including, without limiting the
             generality of the foregoing, driveways, walkways, parking
             facilities and landscaping outside the limits of the Phase II
             Lands, but which are facilities serving the Building and shared
             with the owners and occupants of the lands and premises adjoining
             or contiguous to the Phase II Lands. Except as specifically
             permitted herein, with respect to the parking areas, the Tenant,
             its employees, invitees and licensees shall not be entitled to the
             exclusive use of any parking space or spaces, but shall share and
             use the same reasonably in common with other tenants of the
             Building, their employees, invitees and licensees. Notwithstanding
             the foregoing, the Landlord shall have the right (but shall not be
             obligated) during the Term, to designate parts of the parking areas
             for the exclusive use of the Tenant, its employees, invitees or
             licensees or for the exclusive use of any other tenant or tenants
             of the Building, their employees, invitees and licensees.

        (f)  "COMMON INSIDE AREAS" means the elevators, elevator shafts, stairs,
             passages and washrooms, lobbies, corridors and entrances used in
             common by tenants at ground level and all other levels of the
             Building from time to time, and include any Links which from time
             to time form part of the Complex.

        (g)  "COMPLEX" means the Building and the Phase II Lands as well as any
             portion or portions or the whole of those lands described and
             referred to in Schedule "C" annexed hereto which may from time to
             time be designated by the Landlord as forming part of the Complex;
             provided that no portion shall be designated as forming part of the
             Complex unless and until there has been constructed to the point of
             substantial completion thereon either an office building or hotel
             with an all-weather enclosed pedestrian access from such office
             building or hotel to the Building (the "Link" or "Links") or
             all-weather enclosed access to the Building by a combination of
             Links and other office building or buildings and/or hotel.

        (h)  "LINKS" means the Links as described and defined in the preceding
             sub-paragraph (g).

                                       5

<PAGE>   6

5.   TENANT'S COVENANTS - The Tenant's Covenants with the Landlord:

     (a)  To pay as rent, the rental under Section 3 and all other additional
          rent, and amounts payable by the Tenant under this Lease, in each case
          without deduction, abatement or set off except as otherwise expressly
          provided in this Lease; and

     (b)  To pay:

          (i)  for all costs, including engineering services, incurred or paid
               by the Landlord for the alterations or modifications to either
               the Premises or the Building necessitated by the erection of any
               installations, modifications, alterations, additions or
               partitions made or caused to be made by the Tenant pursuant to
               the provisions of sub-paragraph(s) of this paragraph 5 including,
               without limitation, the removal, modification, and
               re-installation and redesign of the mechanical and electrical
               systems of the Building, together with any affected ceiling, wall
               or floor areas of the Premises or the Building;

          (ii) all charges for telephone, electric current and all other
               utilities supplied to or used in connection with the Premises,
               and the total cost of any replacement of electric bulbs, tubes,
               starters and ballasts in the Premises; if there are no separate
               meters for measuring the consumption of such utilities, the
               Tenant shall pay to the Landlord, in advance by monthly
               instalments as additional rent, such amount as may be reasonably
               estimated by the Landlord from time to time as the cost of such
               utilities for the Premises; the Tenant shall advise the Landlord
               forthwith of any installations, appliances or business machines
               used by the Tenant and consuming or likely to consume large
               amounts of electricity or other utilities and further on request
               shall promptly provide the Landlord with a list of all
               installations, appliances and business machines used in the
               Premises, and the Landlord shall have the right to require the
               Tenant to install a separate meter at the Tenant's expense;

         (iii) costs incurred as a result of the Tenant using the Premises
               during periods other than 8:00 A.M. - 6:00 P.M. Monday to Friday,
               excluding public or statutory holidays, which at the discretion
               of the Landlord may be charged to the Tenant in addition to all
               other charges payable under this lease, and which when received
               from the Tenant will be credited to Total Maintenance Cost before
               Proportionate Share is determined.

     (c)  And to pay to the Landlord as additional rent within ten (10) business
          days following receipt by the Tenant of written notice of the amounts
          owing the Tenant's Proportionate Share of the Total Maintenance Cost,
          if any.

          Any amounts payable by the Tenant to the Landlord pursuant to the
          provisions of this sub-paragraph (c) of this paragraph 5 shall be
          determined and certified by the Landlord following the end of the
          calendar year for which such amount is payable. If only part of the
          final calendar year is included within the Term, any such amount
          payable for such period shall be pro-rated accordingly and shall be
          paid on the date the Term ends. Any balance remaining unpaid or any
          excess paid shall, notwithstanding such termination, be adjusted
          between the Landlord and the Tenant within a reasonable period
          thereafter.

                                       6

<PAGE>   7

          The Landlord shall be entitled in any year, upon at least ten (10)
          days' notice to the Tenant, to require the Tenant to pay monthly, on
          the date for payment of monthly rental instalments and in addition
          thereto, as additional rent, an amount equal to 1/12th of the amount
          estimated by the Landlord to be the amount of the Tenant's
          Proportionate Share of the Total Maintenance Cost for such year. The
          Landlord shall be entitled subsequently during the year upon at least
          ten (10) days' notice to the Tenant to revise its estimate of the
          amount of the Tenant's Proportionate Share of the Total Maintenance
          Cost and the said monthly payment accordingly. All amounts received
          under this provision in any year on account of the estimated amount of
          the Tenant's Proportionate Share of the Total Maintenance Cost shall
          be applied in reduction of the actual amount of the Tenant's
          Proportionate Share of the Total Maintenance Cost for such year. If
          the said amount received is less than the actual amount of the
          Tenant's Proportionate Share of the Total Maintenance Cost the Tenant
          shall pay any deficiency to the Landlord as additional rent within ten
          (10) days following receipt by the Tenant of notice of the amount of
          any deficiency. If the said amount received is greater than the actual
          amount of the Tenant's Proportionate Share of the Total Maintenance
          Cost the Landlord shall refund the excess to the Tenant within a
          reasonable time after the end of the year in respect of which the
          payments were made.

     (d)  JANITORIAL SERVICES - And that the Tenant shall bear the cost of
          janitorial services for the Premises, including, without limitation,
          all sweeping and cleaning of carpeting, floors, the inside of windows,
          blinds and furniture. Such janitor services shall be performed for or
          supplied to the Tenant by employees of or contractors designated by
          the Landlord and the cost thereof shall be borne by the Tenant and be
          included in Total Maintenance Cost. The Landlord shall not be
          responsible for any act of omission or commission on the part of the
          employees or contractors or any other person employed to perform or
          supply such janitor services.

     (e)  BUSINESS TAX AND SCHOOL TAX - And to pay business and other
          governmental taxes, charges, rates, duties and assessments levied in
          respect of the Tenant's occupancy of the Premises or in respect of the
          personal property or business of the Tenant on the Premises as and
          when the same become due and also if the Tenant or any assignee or
          subtenant of the Tenant shall elect to have the Premises or any part
          thereof assessed for separate school taxes, the Tenant shall pay to
          the Landlord, as soon as the amount of the separate school taxes is
          ascertained, any amount by which the separate school taxes exceed the
          amount which would have been payable for school taxes had such
          election not been made.

     (f)  REPAIR - And to repair, maintain and keep the Premises and all of the
          Tenant's equipment, furnishings and chattels therein in good and
          substantial repair as a prudent owner would do, reasonable wear and
          tear only excepted; and that the Landlord may enter and view the state
          of repair, and that the Tenant will repair in accordance with notice
          in writing within fifteen (15) days or such longer period as is
          reasonable in the circumstances after such written notice is given to
          the Tenant; and that the Tenant will leave the Premises in good
          repair, reasonable wear and tear only excepted; provided that if the
          Tenant neglects to so maintain or to make such repairs promptly after
          notice, the Landlord may, at its option, do such maintenance or make
          such repairs at the expense of the Tenant, and in any and every such
          case the Tenant covenants with the Landlord to pay to the Landlord
          forthwith as additional rent all sums which the Landlord may have
          expended in doing such maintenance and making such repairs;

                                       7

<PAGE>   8

          provided further that the doing of such maintenance or the making of
          any repairs by the Landlord shall not relieve the Tenant from the
          obligation to maintain and repair.

     (g)  REPAIRS WHERE TENANT AT FAULT - That if the Complex or the Building,
          including the Premises, the elevators, boilers, engines, pipes and
          other apparatus (or any of them) used for the purpose of heating or
          air-conditioning the Complex or the Building, or operating the
          elevators, or if the water pipes, drainage pipes, electric lighting or
          other equipment of the Complex or the Building or the roof or outside
          walls of the Complex or the Building get out of repair or become
          damaged or destroyed through the negligence, carelessness or misuse of
          the Tenant, his servants, agents, employees or anyone permitted by him
          to be in the Complex or the Building; or through him or them in any
          way stopping up or injuring the heating apparatus, elevators, water
          pipes, drainage pipes or other equipment or part of the Building, the
          expense of all necessary repairs, replacements or alterations shall be
          borne by the Tenant who shall pay the same to the Landlord forthwith
          on demand.

     (h)  GLASS, LOCKS AND TRIMMINGS - That all glass, locks and trimmings of
          the doors and windows in or upon the Premises and in or upon the
          interior or exterior walls or doors abutting or forming part of the
          Premises shall be kept whole and whenever broken due to negligence,
          wilful act of accident on the part of the Tenant, its employers or
          invitees, shall be immediately replaced or repaired under the
          direction and to the reasonable satisfaction of the Landlord and that
          such replacements and/or repairs shall be paid for by the Tenant.
          Provided that all repairs to or replacements of any locks or windows
          shall only be done by a person specified by the Landlord, subject to
          the foregoing provisions with respect to payment for such repairs or
          replacements.

     (i)  ASSIGNING OR SUBLETTING - That he will not, except as hereinafter
          permitted, assign this lease or sublet or franchise, license or
          otherwise part with or share possession of the Premises, or any part
          thereof, without leave which leave shall not be unreasonably withheld,
          provided nevertheless:

          (a)  that where the rent or any other payment to the Tenant under any
               such sublease shall exceed the rent due to the Landlord under
               this lease so far as applicable to the premises comprised in such
               sublease, such excess of the rent or other payment due under such
               sub-lease shall be payable in full to the Landlord as additional
               rent in addition to all other rent due to the Landlord hereunder,

          (b)  that no leave shall be required in the case of an assignment or
               subletting by the Tenant (if a corporation) to another
               corporation that is owned or controlled by the Tenant;

          (c)  that the Landlord shall be entitled to withhold leave arbitrarily
               if the Landlord exercises the right hereinafter set out in clause
               (D) of this sub-paragraph (i);

          (d)  that if the Tenant requests the Landlord's consent to an
               assignment of this lease or to a subletting, franchising,
               licensing, parting with or sharing possession of the whole or any
               part of the Premises to or with any person, firm or corporation
               (other than to one of the kinds of corporation referred to in
               clause (b) of this sub-paragraph (i)) the Tenant shall submit to
               the Landlord the name of the proposed assignee, subtenant,
               franchisee, licensee or other person and such information as to
               the nature of its business and its financial responsibility

                                       8

<PAGE>   9

               and standing as the Landlord may reasonably require. Upon the
               receipt of such request and information from the Tenant the
               Landlord shall have the rights, exercisable in writing within
               fourteen (14) days after such receipt, to cancel and terminate
               this lease if the request is to assign this lease or to sublet,
               franchise, license or otherwise part with possession of all of
               the Premises, or, if the request is to assign, sublet, franchise,
               license or otherwise part with or share possession of a portion
               of the Premises only, to cancel and terminate this lease with
               respect to such portion, in each case as of the date set forth in
               Landlord's notice of exercise of such right, which shall be
               neither less than sixty (60) nor more than one hundred and twenty
               (120) days following the service of such notice; if the Landlord
               shall exercise such right the Tenant shall surrender possession
               of the entire Premises or the portion which is the subject of the
               right, as the case may be, on the date set forth in such notice
               in accordance with the provisions of this lease relating to
               surrender of the Premises at the expiration of the Term. If this
               lease shall be cancelled as to a portion of the Premises only,
               the rent payable by the Tenant under this lease shall be abated
               proportionately. If the Landlord shall not exercise the right to
               cancel this lease as above provided after the receipt of the
               Tenant's written request, then the Landlord's consent to such
               request shall not be unreasonably withheld. In no event shall any
               assignment, subletting, franchising, licensing, or other parting
               with or sharing of possession to which the Landlord may have
               consented or for which the Landlord's consent is not required,
               release or relieve the Tenant from his obligations fully to
               perform all the terms, covenants and conditions of this lease on
               his part to be performed;

          (e)  all reasonable costs of the Landlord in respect of any such
               assignment or sublease or other dealing with this lease or the
               Premises shall be forthwith paid upon demand as additional rent
               by the Tenant or its assignee, subtenant, franchisee or licensee;
               and

          (f)  the Tenant shall not advertise or allow the Premises or a portion
               thereof to be advertised as being available for assignment,
               sublease or otherwise without the prior written approval of the
               Landlord as to the form and content of such advertisement, which
               approval shall not be unreasonably withheld, provided that no
               such advertising shall contain any reference to the rental rate
               of the Premises.

          (g)  Notwithstanding anything to the contrary herein contained, the
               Tenant covenants and agrees with the Landlord that the Tenant
               shall not assign, sublet, franchise, license, or otherwise part
               with or share possession of the Premises or any part thereof for
               the purpose of:

               i)   a printing or duplicating or photocopying business;
               ii)  a smoke shop operation which conducts the business of the
                    sale at retail of tobacco and related items, newspapers,
                    magazines, periodicals, paperbacks, confections of a
                    prepackaged or wrapped variety, canned or bottled soft
                    drinks and juices, convenience pharmaceutical, greeting
                    cards, sundries, ladies hosiery, cartoned milk, lottery
                    tickets, T.T.C. supplies, video movie rentals, and Canada
                    Post supplies;
               iii) general dental and medical offices;

                                       9

<PAGE>   10

               iv)  a sit down and/or take-out restaurant or fast food
                    restaurant or any restaurant of any nature or kind
                    whatsoever;
               v)   a retail travel agency bank;
               vi)  a bank.

     (j)  RULES AND REGULATIONS - That the Tenant and his employees and all
          persons visiting or doing business with them on the Premises shall be
          bound by and will observe and perform the Rules and Regulations
          annexed hereto as Schedule "D" and any further and other Rules and
          Regulations of general application to the Building and/or its use made
          hereafter by the Landlord of which notice in writing shall be given to
          the Tenant and all such Rules and Regulations shall be deemed to be
          incorporated in and form part of this lease.

     (k)  USE OF PREMISES AND INSURANCE - That the Premises shall be used only
          for the purpose of an office and the Tenant will not carry on or
          permit to be carried on therein any other trade or business and that
          the Tenant will not do or omit or permit to be done or omitted upon
          the Premises anything which shall cause the rate of insurance policy
          on the Building or the Complex to be increased or any insurance policy
          on the Building or the Complex to be cancelled and if the Tenant shall
          be in breach of these provisions, the Tenant shall not only be
          responsible for all consequences flowing therefrom and shall indemnify
          the Landlord in respect thereof, but (i) if the rate of insurance on
          the Building or the Complex be increased by reason of the use made of
          the Premises or by reason of anything done or omitted or permitted to
          be done or omitted by the Tenant or by anyone permitted by the Tenant
          to be upon the Premises, the Tenant will pay to the Landlord on demand
          the amount of such increase which amount shall be recoverable as rent;
          and (ii) if any insurance policy upon the Building or the Complex
          shall be cancelled by the insurer by reason of the use or occupation
          of the Premises or any part thereof by the Tenant or by any assignee
          or subtenant of the Tenant or by anyone permitted by the Tenant to be
          upon the Premises the Landlord may at its option determine the Term
          forthwith by leaving upon the Premises notice in writing of its
          intention so to do and thereupon rent and any other payments for which
          the Tenant is liable under this lease shall be apportioned and paid in
          full to the date of such determination and the Tenant shall
          immediately deliver up possession of the Premises to the Landlord and
          the Landlord may re-enter and take possession of the same.

          Provided that subject to the provisions of the next above paragraph
          hereof, if the amount of any insurance premium payable by the Landlord
          in respect of the Premises in any calendar year shall exceed the
          amount of the said insurance premium payable in the first calendar
          year of the Term due to no fault of the Tenant, the Tenant shall pay
          his Proportionate Share of such increase forthwith upon its becoming
          due and payable. If the Tenant fails to pay his Proportionate Share of
          such increase promptly, the Landlord may pay the same and such amount
          paid by the Landlord shall constitute rent in arrears under this
          lease.

     (l)  OBSERVANCE OF LAW - In its use and occupation of the Premises, not to
          violate any and to comply with every law, by-law, ordinance, order,
          rule, regulation or requirement of any federal, provincial or
          municipal government or any department, commission, board or officer
          thereof and with any application, regulation or order of the Canadian
          Underwriters Association, or any body having a similar function, or of
          any liability or fire insurance company by which the Landlord or
          Tenant may from time to time be insured.

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<PAGE>   11

     (m)  ASHES, REFUSE, ETC. - That the Tenant shall not use any outside
          garbage or other containers, nor allow any ashes, refuse, garbage or
          other loose or objectionable material to accumulate in or about the
          Premises and will at all times keep the Premises in clean and
          wholesome condition. The Tenant further covenants that the Tenant will
          not upon the termination of the Term leave upon the Premises any
          rubbish or waste material and will leave the Premises in a clean and
          tidy condition.

     (n)  WASTE AND NUISANCE - Not to make or suffer any waste or cause or allow
          to be caused any damage, disfiguration or injury to the Premises or
          the fixtures and equipment thereof or permit or suffer any overloading
          of the floors thereof; and not to use or permit to be used any part of
          the Premises for any dangerous, noxious or offensive trade, business
          or other activity; and not to cause or maintain any nuisance in, at or
          on the Premises.

     (o)  ENTRY BY LANDLORD - To permit the Landlord or its agents to enter upon
          the Premises at any reasonable time and from time to time upon
          reasonable notice for the purpose of inspecting and of making repairs,
          alterations or improvements to the Premises, the Building or the
          Complex and the Tenant shall not be entitled to compensation for any
          inconvenience, nuisance or discomfort occasioned thereby; provided
          that the foregoing shall be done in such a manner as to interfere as
          little as is reasonable with the Tenant's business.

     (p)  INDEMNITY - To indemnify and save harmless the Landlord against and
          from any and all claims by or on behalf of any person or persons, firm
          or firms, corporation or corporations arising from or out of any act
          or negligence of the Tenant or any assignee, sub-tenant, agent,
          contractor, servant, employee or licensee of the Tenant and against
          and from all costs, counsel fees, expenses and liabilities incurred in
          connection with any such claims or any actions or proceedings brought
          thereon.

     (q)  FLOOR PLANS - That the Tenant acknowledges and agrees that the floor
          plan annexed hereto as Schedule "B" and whereon the Premises are
          identified in red is provided for ready reference only, and that in
          the event of any discrepancy between the Premises as referred to in
          the provisions of this lease and the Premises as identified in
          Schedule "B", the provisions of this lease shall govern.

     (r)  EXHIBITING PREMISES - To permit the Landlord or its agents upon giving
          reasonable notice to exhibit the Premises to prospective tenants
          during normal business hours of the last twelve (12) months of the
          Term.

     (s)  ALTERATIONS, ETC. - That the Tenant will not, without the prior
          written consent of the Landlord, make or erect in or to the Premises
          any installations, alterations, additions, partitions, repairs or
          improvements, or do anything which might affect the proper operation
          of the electrical, lighting, heating, ventilating, air-conditioning,
          sprinkler, fire protection or other systems; without limiting the
          generality of the foregoing, the Tenant will not, without the prior
          written consent of the Landlord and except as directed by the
          Landlord, permit any hole to be drilled or made or nails, screws,
          hooks or spikes to be driven into the floors of the Building; the
          Tenant's request for such consent shall be in writing and accompanied
          by an adequate description of the contemplated work, and where
          appropriate, working drawings and specifications therefor; the
          Landlord's costs of having its architects, engineers or others examine
          such drawings and specifications

                                       11

<PAGE>   12

          shall be payable by the Tenant upon demand as additional rent; the
          Landlord may require that any or all work to be done hereunder be done
          by the Landlord's contractors or workmen or by contractors or workmen
          engaged by the Tenant but first approved by the Landlord, and all work
          shall be subject to inspection by and the reasonable supervision of
          the Landlord and shall be performed in accordance with all laws and
          any reasonable conditions (including a reasonable supervision fee of
          the Landlord to be paid by the Tenant) imposed by the Landlord and
          completed in a good and workmanlike manner and with reasonable
          diligence in accordance with the approvals given by the Landlord; any
          connection of apparatus to the Building systems shall be deemed to be
          an alteration within the meaning of this paragraph; the Tenant shall,
          at its own cost and before commencement of any work, obtain all
          necessary building or other permits and keep same in force and the
          Tenant shall promptly pay all charges incurred by it for any work,
          labour, materials or services and shall not suffer or permit during
          the Term any construction or other liens for work, labour, services or
          materials ordered by it or for the cost of which it may be in any way
          obligated to attach to the Premises, the Building or the Complex;
          whenever and so often as any such liens shall attach or claims
          therefor be filed the Tenant shall within fifteen (15) days after the
          Tenant has notice of the claim for lien obtain the discharge thereof
          by payment of by giving security or in such other manner as is or may
          be required or permitted by law; if the Tenant fails to so discharge
          any liens, the Landlord may (but shall be under no obligation to) pay
          into court the amount required, or otherwise obtain a discharge of the
          lien in the name of the Tenant and any amount so paid together with
          all costs incurred in respect of such discharge shall be payable by
          the Tenant to the Landlord forthwith upon demand plus interest on all
          such amounts at the rate hereinbefore set out; the Tenant shall not
          create any mortgage, conditional sale agreement, or other encumbrance
          in respect of its leasehold improvements or trade fixtures nor shall
          the Tenant lease the same from any third party; notwithstanding
          Section 11 and any other provision anything herein contained, the
          Landlord may require subject to Sections 42 and 43 that the Tenant,
          upon expiration of the Term, at the Tenant's sole expense, restore the
          Premises to the condition that they were in prior to such alterations
          or additions.

     (t)  SIGNS - That except as otherwise permitted in this lease, the Tenant
          will not paint, display, inscribe or affix any sign, picture,
          advertisement, notice, lettering or direction on any part of the
          outside or inside of the Building or on the Premises provided that at
          the request of the Tenant, the Landlord will cause a sign showing the
          name of the Tenant, the Landlord will cause a sign showing the name of
          the Tenant to be placed at the doors of the Premises leading to the
          public corridors and on the directory board on the ground floor of the
          Building; the colour, size, style, character and material of such
          liens shall be such as the Landlord shall determine and the cost of
          such signs shall be paid by the Tenant forthwith upon demand as
          additional rent.

          Provided the Tenant is McDATA Corporation and is in occupancy of the
          Premises, the Tenant shall be permitted to install, at its own
          expense, its corporate name and logo on the second floor podium level
          immediately north of the connection to 105 Gordon Baker Road.
          Installation, design and sizing shall be in keeping with the quality
          of the Building and further subject to the Landlord and its
          consultant's approval. The Tenant shall be required to obtain
          municipal approvals as necessary. Signage to comprise individual
          letters (no box signs). Costs of installation, insurance, maintenance
          and all approvals shall be at the Tenant's expense. Provided the
          Tenant is McDATA Corporation and is in occupancy of the Premises, the
          Tenant shall be entitled to install

                                       12

<PAGE>   13

          at its expense, its name on the existing pylon sign located in front
          of the Building. The Tenant shall be responsible for removal of all
          signage at expiry or earlier termination thereof of its Lease, and to
          restore the exterior of the Building to the state that existed prior
          to the installation of such signage.

          Provided the Tenant is McDATA Corporation and is in occupancy of the
          Premises, the Tenant shall be permitted to prominently display its
          name and logo in the 10th floor elevator lobby. Sizing, design and
          installation shall be subject to the Landlord's and Landlord's
          consultant's reasonable approval.

     (u)  NAME OF BUILDING - Not to refer to the Building or the Complex by any
          name other than that designated from time to time by the Landlord nor
          use the name of the Building or the Complex for any purpose other than
          that of the business address of the Tenant.

     (v)  ENERGY CONSERVATION - To co-operate with the Landlord in conserving
          energy of all types in the Building, including complying at the
          Tenant's own cost with all reasonable requests and demands of the
          Landlord made with a view to energy conservation; any reasonable
          capital expenditures made by the Landlord in an effort to promote
          energy conservation shall be depreciated in accordance with generally
          accepted accounting principals and such depreciation shall be added to
          Total Maintenance Cost.

     (w)  CERTIFICATES - That the Tenant will at any time from time to time, at
          no cost to the Landlord, and upon not less than ten (10) days' prior
          notice, execute and deliver to the Landlord or such other parties as
          designated by the Landlord, a statement in writing certifying that
          this lease is unmodified and in full force and effect (or if modified
          stating the modifications and that the lease is in full force and
          effect as modified), the amount of annual rental then being paid
          hereunder, the dates to which the same, by instalments or otherwise,
          and other charges hereunder have been paid, whether or not there is
          any existing default on the part of the Landlord of which the Tenant
          has notice, and any other information reasonably required.

     (x)  TENANT INSURANCE - At its expense to maintain in force during the Term
          and any renewals thereof:

          (i)  comprehensive general liability insurance against claims for
               personal injury, death or property damage arising out of all
               operations of the Tenant (including tenant's legal liability,
               personal liability, property damages and contractual liability to
               cover all indemnities and repair obligations) with respect to the
               business carried on in and from the Premises, in amounts required
               by the Landlord and any mortgagee of the Building or any parts
               thereof from time to time but in no event less than Five Million
               Dollars ($5,000,000.00) per occurrence; provided however that so
               long as McDATA Corporation is the Tenant such amounts shall be no
               less than One Million Dollars ($1,000,000.00) per occurrence;

          (ii) all risks direct damage insurance, covering the Premises (as
               defined in Section 1) including all chattels and fixtures and all
               leasehold improvements, trade fixtures, installations, additions
               and partitions forming part thereof and covering all of the
               Tenant's equipment, furnishings and chattels therein, in an
               amount equal to the full replacement value thereof; and

                                       13

<PAGE>   14

          (iii) such other forms of insurance as may be reasonably required by
                the Landlord and any mortgagee from time to time.

          All such insurance shall be with insurers and upon such terms and
          conditions as the Landlord reasonably approves, and copies of all
          policies or certificates of insurance and renewal shall be delivered
          to the Landlord; all such policies shall include the Landlord and any
          mortgagees as named insureds as their interests may appear, and shall
          contain a cross liability clause protecting the Landlord in respect of
          claims by the Tenant as if the Landlord were separately insured; all
          such policies shall also contain a provision prohibiting the insurer
          from altering or cancelling the coverage without first giving the
          Landlord thirty (30) days' prior written notice thereof; if the Tenant
          fails to take out and maintain in force such insurance, the Landlord
          may do so and pay the premiums and the Tenant shall pay the Landlord
          the amount of such premiums forthwith upon demand. If both the
          Landlord and the Tenant have claims to be indemnified under any such
          insurance, the indemnity shall be applied first to the settlement of
          the Landlord's claim and the balance, if any, to the settlement of the
          Tenant's claim.

6.   TAXES

     (a)  In this Lease:

          (i)  "MUNICIPAL TAXES" includes all taxes, rates, duties, levies and
               assessments whatsoever whether municipal, parliamentary or
               otherwise, charged upon the Phase II Lands or upon any buildings,
               erections or installations thereon or therein, or charged upon
               the Landlord on account thereof, including municipal taxes or
               local improvements or similar charges, and school taxes (whether
               for public or separate schools) but does not include business
               taxes or business occupancy taxes or other taxes that may
               hereafter be levied upon or in respect of the Tenant's business
               at the Premises, whether or not the same are collectible by the
               Landlord or a charge on the said lands. Where parking, shipping
               and receiving, landscaped and other common areas forming part of
               the Phase II Lands are assessed separately from the Premises and
               other leasehold space on the said lands, "Municipal Taxes" shall
               also include taxes in the year in question levied or charged upon
               or attributable to the assessed value of the same and any
               business taxes or tax in lieu thereof now or hereafter levied
               upon the Landlord in respect of such parking, shipping and
               receiving, landscaped or other common areas. With respect to any
               such Municipal Taxes and similar taxes on other parts of the
               Complex, the Landlord shall have the right from time to time to
               reasonably allocate and reallocate such Municipal Taxes and
               similar taxes among the Building and the Phase II Lands and any
               and all phases or portions of the Complex built from time to
               time, and the amount so allocated to the Building and the Phase
               II Lands shall constitute Municipal Taxes.

          (ii) "YEAR" shall mean the calendar year.

     (b)  The Tenant covenants to pay the Tenant's Proportionate Share of
          Municipal Taxes for each Year to the Landlord as additional rent
          within ten (10) business days following receipt by the Tenant of
          written notice of the amount owing notwithstanding that the year in
          question or the Term of this lease may have ended. If in any Year
          after initial determination of the Tenant's Proportionate Share of
          Municipal Taxes for that Year by

                                       14

<PAGE>   15

          the Landlord, such amount is increased by reason of the issue of
          supplemental assessment notices or taxes or both, or other variation
          in the basis upon which the Tenant's Proportionate Share of Municipal
          Taxes is calculated, the Landlord shall, as often as necessary,
          recalculate the Tenant's Proportionate Share of Municipal Taxes for
          that Year and if the amount of the Tenant's Proportionate Share of
          Municipal Taxes for that year is more than originally calculated, the
          Tenant covenants to pay such excess (together with the original
          calculated amount of the Tenant's Proportionate Share of Municipal
          Taxes for that year if not already paid) as additional rent as
          aforesaid.

     (c)  The Landlord shall be entitled in any Year, upon at least ten (10)
          business days' notice to the Tenant to require the Tenant to pay
          monthly, during the first nine (9) months of each Year, on the date
          for payment of monthly rental instalments and in addition thereto, as
          additional rent, an amount equal to 1/9th of the amount estimated by
          the Landlord to be the amount of the Tenant's Proportionate Share of
          Municipal Taxes for such year. The Landlord shall be entitled
          subsequently during the Year upon at least ten (10) business days'
          notice to the Tenant to revise its estimate of the amount of the
          Tenant's Proportionate Share of Municipal Taxes and the said monthly
          payment accordingly. All amounts received under this provision in any
          Year on account of the estimated amount of the Tenant's Proportionate
          Share of Municipal Taxes shall be applied in reduction of the actual
          amount of the Tenant's Proportionate Share of Municipal Taxes for such
          Year. If the said amounts received are less than the actual amount of
          the Tenant's Proportionate Share of Municipal Taxes, the Tenant shall
          pay the deficiency to the Landlord as additional rent within ten (10)
          business days following receipt by the Tenant of notice of the amount
          of the deficiency. If the said amounts received are greater than the
          actual amount of the Tenant's Proportionate Share of Municipal Taxes,
          the Landlord shall refund the excess to the Tenant within a reasonable
          time after the end of the Year in respect of which the payments were
          made.

     (d)  If the Term shall commence, end or be determined on any day other than
          the first or last days of a Year, the Tenant shall be liable only for
          a portion of the amount of the Tenant's Proportionate Share of
          Municipal Taxes for such Year, determined on a per diem basis by
          dividing the amount of the Tenant's Proportionate Share of Municipal
          Taxes for such Year by 365 and multiplying the quotient so obtained by
          the number of days in the Term falling in the Year in question. If,
          however, during the Year in question, more than one assessed value or
          more than one mill rate shall have been attributed to the Premises,
          the Year shall be divided into periods in each of which one assessed
          value and one mill rate are applicable, and the Landlord shall
          determine the portion of the amount of the Tenant's Proportionate
          Share of Municipal Taxes for such Year to be attributed to each such
          period which shall be a fraction (in the ratio that the number of days
          in the period bears to the number of days in the Year) of the amount
          of the Tenant's Proportionate Share of Municipal Taxes which would
          have occurred had this lease and the assessed value and mill rate for
          the period been in effect for the entire Year. Where a period falls
          entirely within the Term, the portion of the amount of the Tenant's
          Proportionate Share of Municipal Taxes so attributed thereto shall be
          borne entirely by the Tenant; where a period falls entirely outside
          the Term, the portion of the amount of the Tenant's Proportionate
          Share of Municipal Taxes so attributed thereto shall be borne entirely
          by the Landlord; where a period falls partly within and partly outside
          the Term, the portion of the Tenant's Proportionate Share of Municipal
          Taxes so attributed thereto shall be apportioned between the Landlord
          and the Tenant on a per diem basis.

                                       15

<PAGE>   16

7.   RECOVERY OF ADJUSTMENTS - The Landlord shall have (in addition to any other
     right or remedy) the same rights and remedies in the event of default by
     the Tenant in payment of any amount payable pursuant to paragraph 6, or any
     other provision of this lease, as the Landlord would have in the case of
     default in payment of rent.

8.   QUIET ENJOYMENT - The Landlord covenants with the Tenant for quiet
     enjoyment.

9.   LANDLORD'S COVENANTS - The Landlord further covenants with the Tenant:

     (a)  TAXES - To pay, subject to the provisions of paragraph 6 hereof, all
          municipal property taxes (including local improvement rates), rates,
          duties and assessments that may be charged, levied, rated or assessed
          against the Premises.

     (b)  LIGHTING, HEATING AND AIR CONDITIONING - To provide lighting to the
          Premises and the Building of which the Premises form part including
          the Common Inside Areas and the Common Outside Areas and Facilities
          and to provide heating and air-conditioning to the Premises to an
          extent sufficient to maintain therein a reasonable temperature at all
          times during normal business hours, which are defined as between 8:00
          a.m. and 6:00 p.m. Monday through Friday, excluding public or
          statutory holidays, except during the making of repairs; and, to
          provide, at hours other than normal business hours, at the Tenant's
          request and expense, electricity, hot and cold running water, heat
          (when necessary), air conditioning (when necessary), lighting within
          the Premises and elevator service; but should the Landlord make
          default in providing such services, it shall not be liable for any
          other or greater damages than the monies (if any) expended by the
          Tenant in providing such services for the Premises and in no event
          shall the Landlord be liable for indirect or consequential damages for
          personal discomfort or illness suffered by the Tenant, its servants,
          agents or employees or any other person using the Premises arising out
          of any default of the Landlord in providing such services.

     (c)  CARETAKING - To maintain and keep clean all public areas in the
          Building including the washrooms, subject to the provisions hereof.
          The Landlord shall not have any responsibility to provide any such
          services within the Premises, except as to the obligations to cause
          such maintenance and cleaning to be done. In addition, the Landlord
          shall not be responsible for any act of omission or commission or for
          any negligence on the part of the person employed to perform such
          work.

     (d)  ACCESS

          (i)  To permit the Tenant and the employees of the Tenant and all
               persons lawfully requiring communication with them to have the
               use at reasonable times in common with others of the main
               entrance of the Building and the stairways and corridors leading
               to the Premises; provided that the Landlord may maintain
               reasonable security measures in the Building to prevent
               unauthorized persons entering the Premises and the Building after
               normal business hours which are defined as between 8:00 a.m. and
               6:00 p.m. Monday through Friday, excluding public or statutory
               holidays.

          (ii) It is understood and agreed that the Landlord shall not prevent
               the Tenant and its employees from having access to the Premises
               twenty-four (24) hours a day, seven (7) days a week throughout
               the Term and any renewals thereof, as well as to the parking
               facilities for the Building, by activation controls and from

                                       16

<PAGE>   17

                using the common areas of the Building and the property for its
                intended purposes in common with others entitled thereto.

          (iii) The Landlord will allow the Tenant access to the
                electrical/telephone room in the core to install the Tenant's
                telephone/data equipment and electrical panels, at such time(s)
                as many be arranged in advance with the Landlord, after
                obtaining the Landlord's approval which will not be
                unnecessarily withheld.

     (e)  WASHROOMS - To permit the Tenant and the employees of the Tenant in
          common with others entitled thereto to use the washrooms in the
          Building.

     (f)  ELEVATORS - To furnish, during normal business hours, as hereinbefore
          defined, except when repairs are being made, elevator service, to
          permit the Tenant and the Tenant's employees and invitees to have free
          use of such elevator service in common with others entitled thereto,
          but the Tenant and such employees and all other persons using such
          service shall do so at their sole risk and under no circumstances
          shall the Landlord be held responsible for any damage or injury
          happening to any person while using the elevator or occasioned to any
          person by any elevator or any of its appurtenances; the use of such
          elevator and all deliveries to the Premises shall be in the manner and
          at the times designated from time to time by the Landlord.

     (g)  The Landlord warrants that it will maintain the Building as a first
          class office building similar to other "A" class buildings in the City
          of North York which are of comparable age, size and location.

10.  COMMON AREAS -EXPANSION AND ALTERATION

     (a)  Notwithstanding anything in this lease contained, the Landlord shall
          upon giving 24 hour written notice have the right to enter into the
          Premises and to bring workmen and materials thereon to make such
          additions, alterations, improvements, installations and repairs, as
          the Landlord may from time to time decide, in respect of the Building,
          the Complex, the Phase II Lands, the lands described in Schedule "C",
          the Common Inside Areas, the Common Outside Areas and Facilities, or
          any part thereof, including the walkways, parking areas, shipping and
          receiving areas, driveways, and any other improvements thereto or
          erections thereon (except to the Premises), including the right to
          change the size and shape thereof, erect buildings thereon or sell or
          lease part or parts thereof. The Landlord may cause such reasonable
          obstructions and interference with the use and enjoyment of the
          Building, Complex, Phase II Lands and other lands, Common Inside Areas
          or Common Outside Areas and Facilities as may be necessary for the
          purposes aforesaid and may interrupt or suspend the supply of
          electricity, water or other utilities or services when necessary and
          until the additions, alterations, improvements, installations or
          repairs have been completed, and there shall be no abatement in rent
          nor shall the Landlord be liable by reason thereof, provided all such
          work and such interruptions or suspensions is done as expeditiously as
          reasonably possible. The Landlord shall have the right to use,
          install, maintain and repair pipes, wires, ducts, shafts or other
          installations in, under or through the Premises for or in connection
          with the supply of any services to the Premises or any other premises
          in the Building or on the Phase II Lands or the lands described in
          Schedule "C".

          Without limiting the generality of the foregoing, the Landlord hereby
          reserves the right at any time and from time to time to make changes
          or revisions in its plans for the said

                                       17

<PAGE>   18

          lands, the Building, the Complex, the Common Inside Areas or the
          Common Outside Areas and Facilities, as aforesaid, and particularly
          the right to construct other buildings and improvements on the Phase
          II Lands or the lands described in Schedule "C". The Landlord shall
          have the right to specify the date on which any such changes become
          part of the said lands, the Building, the Complex, the Common Inside
          Areas or the Common Outside Areas and Facilities, as the case may be,
          for all purposes.

     (b)  The Landlord shall have the right to issue rules and regulations from
          time to time respecting the use of the Common Inside Areas and Common
          Outside Areas and Facilities including without limiting the generality
          of the foregoing rules and regulations designating the means by which
          merchandise may be moved to and from the storage or loading areas and
          all such rules and regulations shall be binding upon the Tenant.

     (c)  The manner in which the Common Outside Areas and Facilities and the
          Common Inside Areas are maintained and the expenditures incurred in
          connection therewith shall be at the sole discretion of the Landlord.

11.  FIXTURES - Provided that the Tenant may remove its trade fixtures; provided
     further that all installations, alterations, additions, partitions and
     fixtures other than trade or tenant's fixtures in or upon the Premises,
     whether placed there by the Tenant or the Landlord, shall become the
     Landlord's property without compensation therefor to the Tenant and shall
     not be removed from the Premises at any time either during or after the
     Term; and provided further that if the Landlord so directs by written
     notice to the Tenant, the Tenant shall upon the termination of the Term, at
     the expense of the Tenant, subject to the provisions of Section 42 and 43
     of this Lease, promptly remove any or all of the installations,
     alterations, additions, partitions and fixtures placed in the Premises by
     or at the request of the Tenant or accepted by the Tenant at the
     commencement of the Term and the Tenant shall make good any damage caused
     by such removal or the Landlord may make good such damage and the Tenant
     shall pay the cost thereof on demand which shall be recoverable as rent.

12.  INJURY TO PREMISES AND BUILDING -Provided that if during the Term, the
     Premises or the Building shall be damaged or destroyed by any cause
     whatsoever, then the following provisions shall have effect if and to the
     extent applicable:

     (a)  If the Premises or other parts of the Building shall be so badly
          injured as to render the Premises unfit for the Tenant's use and
          occupancy and shall be incapable, with reasonable diligence, of being
          repaired within 180 days from the happening of such injury then either
          the Landlord or the Tenant (subject to clause (d) below) may declare
          the Term to be forthwith terminated and the Tenant shall immediately
          surrender the Premises to the Landlord and shall pay rent only to the
          time of such injury, and the Landlord may re-enter and repossess the
          Premises discharged of this lease and may remove all person therefrom.

     (b)  If the Premises or other parts of the Building shall be capable, with
          reasonable diligence, of being repaired and rendered fit for the
          Tenant's use and occupancy within 180 days from the happening of such
          injury as aforesaid then, subject to clause (d) below, (i) if the
          damage is such as to render the Premises wholly unfit for occupancy
          during the process of such repairs, the rent hereby reserved shall not
          run or accrue after such injury or while the process of repair is
          going on and the rent shall recommence immediately after such repairs
          have been completed; or (ii) if the damage

                                       18

<PAGE>   19

          is so slight that the Premises are partially fit for occupancy and use
          for the purpose of the Tenant's business, until such damage has been
          repaired the rent hereby reserved shall abate only in proportion to
          the extent that possession and enjoyment are interfered with and until
          such possession and enjoyment are fully restored. For greater
          certainty the Landlord shall repair the Building and the Tenant, in
          accordance with its obligation under Section 5(f), shall repair the
          Premises and its equipment, furnishing and chattels therein.

     (c)  The certificate of the Landlord's Architect as to whether any such
          injury can or cannot be repaired within a period of one hundred and
          eighty (180) days from the happening of any such injury shall be final
          and binding upon the parties hereto as to the facts so certified.

     (d)  Notwithstanding anything to the contrary under this section 12, the
          Tenant shall not be entitled to terminate this Lease under clause (a)
          above or to receive any abatement of rent under clause (b) above where
          the Tenant is responsible for the cost of repairing such damage or
          destruction under Section 5(g).

13.  DAMAGES TO PROPERTY - The Landlord shall not be liable nor responsible in
     any way for any loss of or damage or injury to any property belonging to
     the Tenant or to employees of the Tenant or to any other person while such
     property is in or upon the Premises or in the Building or the Complex
     unless such loss, damage or injury shall have been caused by the gross
     negligence of the Landlord or of its employees, servants or agents; but,
     notwithstanding the foregoing, in no event shall the Landlord be liable for
     indirect or consequential damages or for any damage to any such property
     caused by steam, water, rain or snow which may leak into, issue or flow
     from any part of the Building or the Complex or from the water, steam or
     drainage pipes or plumbing works of the Building or the Complex or from any
     other place or quarter or for any damage caused by or attributable to the
     condition or arrangement of any electric or other wiring or for any damage
     caused by anything done or omitted by any other tenant. The Tenant
     covenants to indemnify and save harmless the Landlord against and from all
     loss, costs, claims or demands in respect of any injuries, loss or damage
     referred to in this paragraph except if same is caused by the negligent act
     or omission of the Landlord.

14.  IMPOSSIBILITY OF PERFORMANCE - It is understood and agreed that whenever
     and to the extent that the Landlord shall be unable to fulfil or shall be
     delayed or restricted in the fulfilment of any obligation hereunder in
     respect of the supply or provision of any service or utility or the doing
     of any work or the making of any repairs by reason of being unable to
     obtain the material, goods, equipment, service or labour required to enable
     it to fulfil such obligation or by reason of any statute, law or
     order-in-council or any regulation or order passed or made pursuant thereto
     or by reason of the order or direction of any administrator, controller,
     board, governmental department or officer or other authority, or by reason
     of not being able to obtain any permission or authority required thereby,
     or by reason of any other cause beyond its control whether of the foregoing
     character or not, the Landlord shall be relieved from the fulfilment of
     such obligation and the Tenant shall not be entitled to compensation for
     any inconvenience, nuisance or discomfort thereby occasioned.

15.  DEFAULT OF TENANT - Provided, and it is hereby expressly agreed, that if
     and whenever the rent hereby reserved, or any part thereof, shall not be
     paid on the day appointed for payment thereof, although no formal demand
     shall have been made thereof, or in the case of the breach, non-observance
     or non-performance of any of the covenants or agreements or Rules and
     Regulations herein contained or referred to on the part of the Tenant to be
     observed and

                                       19

<PAGE>   20

     performed, or in the case the Premises shall be vacated or remain
     unoccupied for a period of fifteen (15) consecutive days, or in case the
     Term shall be taken in execution or attachment for any cause whatever, then
     and in each such case, it shall be lawful for the Landlord at any time
     thereafter to re-enter the Premises or any part thereof in the name of the
     whole and the same to have again, re-possess and enjoy as of its former
     estate, anything herein contained to the contrary notwithstanding.

16.  BANKRUPTCY - Provided further that in case the Premises shall remain vacant
     or not used for period of fifteen days or be used by any person other than
     the Tenant or for any purpose other than that as herein or in the annexed
     Rules and Regulations provided, without the written consent of the
     Landlord, or in case the Term or any of the goods and chattels of the
     Tenant shall be at any time seized in execution or attachment by any
     creditor of the Tenant or the Tenant shall make any assignment for the
     benefit of creditors or become bankrupt or insolvent or take the benefit of
     any Act now or hereafter in force for bankrupt or insolvent debtors or (if
     the Tenant is a company) an order shall be made for the winding-up of the
     Tenant, then in any such case this lease shall, at the option of the
     Landlord, cease and determine and the Term shall immediately become
     forfeited and void and the then current month's rent and the next ensuing
     three months' rent shall immediately become due and payable and the
     Landlord may re-enter and take possession of the Premises as though the
     Tenant or other occupant or occupants of the Premises was or were holding
     over after the expiration of the Term without any right whatever, but the
     Tenant shall continue to be liable to the Landlord for the rent hereby
     reserved for the balance of the Term.

17.  WAIVER OF EXEMPTIONS - The Tenant hereby covenants and agrees with the
     Landlord that in consideration of the Premises and of the leasing and
     letting by the Landlord to the Tenant of the Premises for the Term (and it
     is upon that express understanding that these presents are entered into),
     notwithstanding anything contained in Section 30 of the Landlord and Tenant
     Act, RSO 1990, CCL. 7 or in any other statute which may hereafter be passed
     to take the place of the said Act or the amendment of same, none of the
     goods or chattels of the Tenant at any time during the continuance of the
     Term hereby created on the Premises, shall be exempt from levy by distress
     for rent in arrears by the Tenant as provided for by section or sections of
     the said Act or any amendment or amendments thereto, and that upon any
     claim being made for such exemption by the Tenant or on distress being made
     by the Landlord this covenant and agreement may be pleaded as an estoppel
     against the Tenant in any action brought to test the right to the levying
     upon any such goods as are named as exempted in said section or sections or
     amendment or amendments thereto, the Tenant waiving as the Tenant hereby
     does, every benefit that could or might have accrued to the Tenant under
     and by virtue of the said section or sections of the said Act or any
     amendment or amendments thereto but for this covenant.

18.  RIGHT OF RE-ENTRY - The Tenant further covenants and agrees that upon the
     Landlord becoming entitled to re-enter upon the Premises under any of the
     provisions of this lease, the Landlord in addition to all other rights,
     shall have the right to enter the Premises as the agent of the Tenant
     either by force or otherwise, without being liable for any prosecution
     therefor, and to re-let the Premises as the agent of the Tenant, and to
     receive the rent therefor and, as the agent of the Tenant, to take
     possession of any furniture or other property on the Premises and to sell
     the same at public or private sale with or without notice and to apply the
     proceeds of such sale and any rent derived from re-letting the Premises
     upon account of the rent hereby reserved, and the Tenant shall be liable to
     the Landlord for the deficiency if any.

                                       20

<PAGE>   21

19.  RIGHT OF TERMINATION - The Tenant further covenants and agrees that upon
     the Landlord becoming entitled to re-enter upon the Premises under any of
     the provisions of this lease, the Landlord, in addition to all other
     rights, shall have the right to terminate forthwith this lease and the Term
     by leaving upon the Premises notice in writing of its intention so to do,
     and thereupon rent and any other payments for which the Tenant is liable
     under this lease shall be computed, apportioned and paid in full to the
     date of such termination of this lease, and the Tenant shall immediately
     deliver up possession of the Premises to the Landlord, and the Landlord may
     re-enter and take possession of the same. Any such re-entry and any such
     termination shall be without prejudice to the Landlord's right to sue for
     damages and to pursue its other remedies at law and hereunder.

20.  NON-WAIVER - Any condoning, waiving, excusing or overlooking by the
     Landlord of any default, breach or non-observance by the Tenant at any time
     or times of or in respect of any covenant, proviso or condition herein
     contained shall not operate as a waiver of the Landlord's rights hereunder
     in respect of any subsequent default, breach or non-observance, nor so as
     to defeat or affect in any way the rights of the Landlord herein in respect
     of any such subsequent default or breach.

21.  WAIVER - The Tenant hereby expressly waives the benefit or Section 35 of
     the Landlord and Tenant Act and amendments thereto and of any present or
     future Act of the Legislature of the Province of Ontario permitting the
     Tenant to claim a set off against the rent reserved hereby for any cause
     whatsoever.

22.  CHATTELS - Provided that in the case of removal by the Tenant of the goods
     and chattels of the Tenant from the Premises the Landlord may follow the
     same for thirty (30) days in the same manner as is provided for in the
     Landlord and Tenant Act.

23.  LANDLORD MAY PERFORM COVENANTS - If the Tenant shall fail to perform any of
     the covenants or obligations of the Tenant under or in respect of this
     lease, the Landlord, subject as hereinafter provided, may from time to
     time, in its discretion, perform or cause to be performed any of such
     covenants or obligations, or any part thereof, and for such purpose may do
     such things as may be requisite, including without limiting the foregoing,
     entering upon the Premises and doing such things upon or in respect of the
     Premises or any part thereof as the Landlord may consider requisite or
     necessary or making, on behalf of the Tenant, any payment which the Tenant
     is obligated to make under the provisions of this lease (including all
     expenses incurred and expenditures made by or on behalf of the Landlord
     under this paragraph and any other amounts owing by the Tenant to the
     Landlord under the provisions of this lease, other than rent) shall, unless
     otherwise provided in this lease, be forthwith paid by the Tenant to the
     Landlord upon receipt of written notice requesting same and if not so paid
     shall bear interest at the same rate as referred to in paragraph 3 of this
     lease, from the date the same were incurred, made or due (particulars as to
     which shall be given by the Landlord to the Tenant) and all amounts owing
     to the Landlord and referred to by this paragraph shall be deemed to be
     additional rent and recoverable by the Landlord in the same manner as if
     they were rent in arrears and with like powers of distress. Provided that,
     except in cases of emergency, the Landlord before exercising its rights
     under this clause to perform any obligation or covenant of the Tenant shall
     give to the Tenant fifteen (15) days' notice of the default which the
     Landlord intends to remedy and if the Tenant within said period forthwith
     remedies or takes such action as may be necessary to remedy said default
     and thereafter pursues and completes same with all reasonable diligence the
     Landlord shall not proceed under this clause in respect of said default.

                                       21

<PAGE>   22

24.  OVERHOLDING - If without any further written agreement the Tenant shall
     continue to occupy the Premises and pay rent after the expiration of the
     Term, the Tenant shall be a monthly tenant at a monthly rental equal to
     one-sixth (1/6) of the annual rental payable in respect of the last year of
     the Term and otherwise on the terms and conditions herein set out, except
     as to length of tenancy.

25.  NO COLLATERAL AGREEMENTS - It is understood and agreed that this lease
     contains the entire agreement and understanding made between the parties
     hereto and that there is no representation, warranty, collateral agreement
     or condition, expressed or implied, affecting this lease or supported
     hereby other than such as may be expressly contained in or implied from the
     provisions hereof and that this lease may not be modified except as herein
     expressly provided or except by subsequent agreement in writing of equal
     formality hereto executed by the Landlord and the Tenant.

26.  ARBITRATION

     (a)  In the case of any dispute between the Landlord and the Tenant during
          the Term hereof, and any renewal, as to any matter arising hereunder,
          either party hereto shall be entitled to give to the other party
          notice of such dispute and demand arbitration thereof and, after
          giving notice and demand, each party shall at once appoint an
          arbitrator and such appointees shall jointly appoint a third. The
          decision of any two of the three arbitrators so appointed shall be
          final and binding upon the parties hereto who covenant one with the
          other that their disputes shall be so decided by arbitration alone and
          not be recourse to any court by action at law.

     (b)  If within a reasonable time the two arbitrators appointed by the
          parties hereto do not agree upon a third, or if the party who has been
          notified of a dispute fails to appoint an arbitrator, then a third
          arbitrator or an arbitrator to represent the party in default may,
          upon petition of the party not in default, be appointed by a judge of
          the Ontario Court of Justice. The cost of the arbitration shall be
          apportioned between the parties hereto as the arbitrators may decide.

27.  SUBORDINATION - This lease is subject and subordinate to all ground or
     underlying leases, if any, and to all mortgages (including any deed or
     trust and mortgage securing bonds and all indentures supplemental thereto)
     which may now or hereafter affect either the freehold lands on which the
     Building is situate or such leases and the parcel or parcels of leasehold
     land constituted thereby, as the case may be, and to all renewals,
     modifications, consolidations, replacements and extensions thereof. The
     Tenant agrees to execute promptly any certificate in confirmation of such
     subordination as the Landlord may request and hereby constitutes the
     Landlord, the agent or attorney in fact of the Tenant for the purpose of
     executing any such certificate and of making application at any time and
     from time to time to register postponements of this lease in favour of any
     such mortgage in order to give effect to the provisions of this paragraph
     27. Notwithstanding and in addition to the foregoing, the holder of any
     such mortgage may subordinate and postpone such mortgage to this Lease at
     anytime by instrument in writing registered on title without the further
     consent or agreement of the Tenant. The Tenant, if so requested, shall
     attorn to any mortgage when such mortgage takes possession of the Building
     and to any purchaser of the Building and shall recognize such mortgagee or
     purchaser as the landlord under the Lease.

28.  REGISTRATION - The Tenant covenants and agrees with the Landlord that the
     Tenant will not register this lease in this form in the appropriate
     Registry Office or Land Titles office, as the

                                       22

<PAGE>   23

     case may be. If the Tenant desires to make a registration for the purpose
     only of giving notice of this lease, then the parties hereto shall
     contemporaneously with the execution of this lease execute a short form
     thereof, solely for the purpose of supporting an application for
     registration of notice thereof. The Tenant shall pay to the Landlord
     forthwith upon demand as additional rent the Landlord's reasonable costs
     associated with such registration, including reasonable legal fees.

29.  NOTICE - Any notice or request herein provided for or given hereunder if
     given by the Landlord to the Tenant shall be sufficiently given if mailed
     at a time of no actual or reasonable anticipated disruption in regular
     postal service, by prepaid registered post address to the Tenant at the
     Premises or if delivered in a sealed envelope addressed to the Tenant at
     the Premises and any notice or request herein provided for or given
     hereunder if given by the Tenant to the Landlord shall be sufficiently
     given if mailed or delivered as aforesaid addressed to the Landlord c/o
     Emerald Property Services Inc., with respect to Cosmopolitan Corporate
     Centre Phase II, 335 Bay Street, Suite 900, Toronto, Ontario, M5H 2R3. Any
     notice or request shall be conclusively deemed to have been given if mailed
     as aforesaid on the third business day next following the day on which it
     was so mailed, if sent by facsimile shall be conclusively deemed to have
     been delivered at the time of such sending unless received after 5:00 p.m.
     local time of the addressee's offices in which event it shall be deemed to
     have been received on the next business day, and if delivered at the time
     of delivery. Either party may at any time give notice in writing to the
     other of any change of address of the party giving such notice and from and
     after the giving of such notice the address therein specified shall be
     deemed to be the address of such party for the purpose of giving such
     notices or requests thereafter.

30.  CAPTIONS - The captions appearing in this lease have been inserted as a
     matter of convenience and for reference only and in no way define, limit or
     enlarge the scope of meaning of this lease or any of its provisions.

31.  EFFECTS OF LEASE - This indenture and everything herein contained shall
     extend to and bind and may be taken advantage of by the respective heirs,
     executors, administrators, successors, and assigns, as the case may be, of
     each and every of the parties hereto, subject to the granting of consent by
     the Landlord as provided in paragraph 5(i) to any assignment or sub-lease,
     and where the Tenant consists of more than one person or is a female or a
     corporation, the provisions hereof shall be read with all grammatical
     changes thereby rendered necessary and all covenants on the part of the
     Tenant shall be deemed point and several.

32.  SCHEDULES - Schedules "A", "B", "C" and "D" annexed hereto form part of
     this lease.

33.  ASSIGNMENT BY LANDLORD - If the Landlord sells the Building or Complex or
     leases the entire Building or Complex under one lease, or so sells or
     leases the lands on which the Building or Complex is located or any part
     thereof, or assigns this lease, and to the extent that the purchaser,
     lessee or assignee is responsible for compliance with the covenants and
     obligations of the Landlord hereunder, the Landlord without further written
     agreement shall be discharged and relieved of liability under the said
     covenants and obligations.

34.  ADDITIONAL RENTALS - All amounts that are or shall become payable by the
     Tenant to the Landlord pursuant to this lease and whether hereinbefore
     expressed to be payable as additional rent or otherwise than as rent shall
     be and it is hereby agreed that they and each of them shall be payable as
     additional rent.

35.  TIME OF ESSENCE - Time shall be of the essence of this lease.

                                       23

<PAGE>   24

36.  LAW - This lease shall be governed by and construed in accordance with the
     laws of the Province of Ontario.

37.  PLANNING ACT - This lease is subject to compliance with the provisions of
     the Planning Act of Ontario.

38.  PARKING SPACES

     (a)  The Tenant shall be entitled during the Term to have the use of up to
          fifty-two (52) parking spaces in the parking facilities from time to
          time forming part of the Complex. The Landlord shall use it reasonable
          best efforts to provide these parking spaces on a contiguous basis,
          fifty percent (50%) of which shall be assigned for the exclusive use
          of the Tenant, and the Landlord shall provide to the Tenant up to
          fifty-two (52) parking access cards for the indoor parking garage of
          the Building, all at no cost to the Tenant. The cost of signage for
          all parking spaces shall be borne by the Tenant. The use of such
          parking spaces shall be subject to the rules and regulations
          prescribed by the Landlord, its contractor or agent from time to time
          for parking in the parking facilities of the Complex. The Landlord
          shall have to the right to monitor the Tenant's use of such parking
          spaces from time to time, and in the event the Tenant is not making
          use of any number of the allocated parking spaces, the Landlord may,
          upon mutual consent with the Tenant, reduce the number of Tenant
          parking stalls accordingly.

     (b)  No propane-powered vehicles shall be permitted in the indoor parking
          facilities of the Complex.

39.  NET LEASE - The Tenant acknowledges that it is intended and agreed that
     this Lease is completely carefree net lease for the Landlord and that the
     Landlord is not responsible during the Term or any renewals thereof for any
     costs, charges, expenses or outlays of any nature relating to the Premises,
     Building, the Common Inside Areas and Common Outside Areas and Facilities,
     or the Complex, or the contents thereof, or otherwise, except as
     specifically set forth in this Lease, and that the Tenant will pay all
     charges, taxes, impositions, costs and expenses of every kind relative to
     the Premises, and the Tenant covenants with the Landlord accordingly.

     Notwithstanding any other provisions of this Lease to the contrary, the
     Tenant shall pay to the Landlord an amount equal to any and all goods and
     services taxes, sales taxes, value added taxes, or any other taxes imposed
     on the Landlord with respect to Basic Rent, Additional Rent or any other
     amounts payable by the Tenant to the Landlord under this Lease whether
     characterized as a goods and services tax, sales tax, value added tax or
     otherwise (herein called "Sales Taxes"), it being the intention of the
     parties that the Landlord shall be fully reimbursed by the Tenant with
     respect to any and all Sales Taxes payable by the Landlord. The amount of
     such Sales Taxes so payable by the Tenant shall be calculated by the
     Landlord in accordance with the applicable legislation and shall be paid to
     the Landlord at the same time as the amounts to which such Sales Taxes
     apply are payable to the Landlord under the terms of this Lease or upon
     demand at such other time or times as the Landlord from time to time
     determines. Notwithstanding any other provision in this Lease to the
     contrary, the amount payable by the Tenant under this paragraph shall be
     deemed not to be Basic Rent or additional rent, but the Landlord shall have
     all of the same remedies for and rights of recovery of such amount as it
     has for recovery of rent under this Lease.

                                       24

<PAGE>   25

40.  RELOCATION - The Landlord shall have the right, at any time and from time
     to time during the Term of this Lease and any renewal thereof, to change
     the location of the Premises from the location described in this Lease to
     another location elsewhere in the Building. Provided that the Landlord
     shall give the Tenant reasonable notice of such relocation and the Landlord
     shall reimburse the Tenant for all reasonable out of pocket costs directly
     related to such relocation, but not including any direct costs such as lost
     profits during the relocation period or damages for inconvenience.

41.  LEASEHOLD IMPROVEMENTS - The Tenant shall lease the Premises on an "as is"
     basis. Those leasehold improvements existing in the Premises at the
     commencement of the Term shall be the responsibility of the Tenant. All
     leasehold further improvements shall be at the Tenant's cost and must have
     the Landlord's written approval before installation.

42.  LANDLORDS RIGHT TO TERMINATE - The Landlord may with no less than six (6)
     months prior written notice, which notice cannot be delivered on or before
     December 31, 1997, terminate the Lease. For sake of greater clarity, the
     earliest date of termination shall be June 30, 1998, and thereafter at any
     time with six months prior written notice. The Tenant agrees to vacate the
     Premises six (6) months following delivery of such notice and shall leave
     the Premises in "broom swept" condition. The Tenant shall repair at its own
     expense damage to the Premises. In the event the Landlord terminates the
     Lease, the Tenant shall not be required to remove and restore any of the
     existing Leasehold Improvements.

43.  TENANT'S RIGHT TO TERMINATE - The Tenant may with no less than six (6)
     months prior written notice, which notice cannot be delivered on or before
     June 30, 1998, terminate the Lease. For sake of greater clarity, the
     earliest date of termination by the Tenant shall be December 31, 1998, and
     thereafter at any time with six months prior written notice. The Tenant
     agrees to vacate the Premises six (6) months following delivery of such
     notice and shall leave the Premises in "broom swept" condition. The Tenant
     shall repair at its own expense damage to the Premises. In the event the
     Tenant terminates the Lease, the Tenant shall, if requested by the Landlord
     remove and restore the Leasehold Improvements and repair any damage caused
     by said removal to a maximum cost of sixteen thousand four hundred and
     forty-two dollars ($16,442.00).

44.  RIGHTS PERSONAL - Parking, Signage Rights and the Tenant's Right to
     Terminate are personal to McDATA Corporation; are not assignable and shall
     cease upon McDATA Corporation assigning this Lease to a third party not
     affiliated with McDATA Corporation.

                                       25

<PAGE>   26

IN WITNESS WHEREOF the Landlord and the Tenant have executed these presents.

LANDLORD                                1211486 ONTARIO LIMITED

                                        Per:   /s/ George S. Schott
                                             ----------------------------------
                                        Name:  George S. Schott
                                        Title: President

SIGNED, SEALED AND DELIVERED in the presence of:

TENANT                                  MCDATA CORPORATION

                                        Per:   /s/ Dee J. Perry
                                             ----------------------------------
                                        Name:  Dee J. Perry
                                        Title: CFO, VP Finance & Adm.

                                                                             c/s

                                        Per:  _________________________________
                                        Name:
                                        Title:

                                                                             c/s

                                       26
<PAGE>   27

                                  SCHEDULE "A"

                                LEGAL DESCRIPTION
                          COSMOPOLITAN CORPORATE CENTRE
                                 PHASE II LANDS

     ALL AND SINGULAR those certain parcels or tracts of land and premises
situate, lying and being in the City of North York, in the Municipality of
Metropolitan Toronto, being composed of all of Block E according to Registered
Plan No. 9518 and Blocks N and V according to Registered Plan No. 8723, said
lands and premises being designated as Parts 1, 2, 3, 4 and 5 on Reference Plan
No. 64R-10673, save and except that part of Block E, according to Registered
Plan No. 9518 designated as Parts 1, 2 and 3 on Reference Plan No. 64R-10927.

<PAGE>   28

                                  SCHEDULE "B"

                                    [DIAGRAM]

<PAGE>   29

                                  SCHEDULE "C"

                                LEGAL DESCRIPTION
                          COSMOPOLITAN CORPORATE CENTRE

FIRSTLY

     ALL AND SINGULAR those certain parcels or tracts of land and premises
situate, lying and being in the City of North York, in the Municipality of
Metropolitan Toronto, being composed of all of Block E according to Registered
Plan No. 9518 and Blocks N and V according to Registered Plan No. 8723, said
lands and premises being designated as Parts 1, 2, 3, 4 and 5 on Reference Plan
No. 64R-10673,

SECONDLY

     ALL AND SINGULAR those certain parcels or tracts of land and premises
situate, lying and being in the City of North York, in the Municipality of
Metropolitan Toronto, being composed of those parts of Lot 22, Concession 4,
East of Yonge Street, designated as Parts 1 and 2 on Reference Plan No.64R-9889.

Together with a perpetual right of way for persons and vehicles in, over, along
and upon that part of Lot 22, Concession 4, East of Yonge Street designated as
Part 8 on Reference Plan 64R-10673.

<PAGE>   30

                                  SCHEDULE "D"

                              RULES AND REGULATIONS

1.   INGRESS AND EGRESS

     The sidewalks, entrances, elevators, stairways, corridors and fire escapes
     of the Complex and Building shall not be obstructed by the Tenant or used
     by him for any purpose other than for ingress and egress to and from the
     Premises. The Tenant shall not place or allow to be placed in the hallways,
     corridors or stairways any waste paper, dust, garbage, refuse or anything
     else whatsoever that would obstruct them or tend to make them appear
     unclean or untidy. Nothing shall be thrown by the Tenant or his employees
     out of the windows or doors or down the passages or sky lights of the
     Building.

2.   HEAVY EQUIPMENT

     Business machines, filing cabinets, heavy merchandise, equipment or other
     articles liable to overload, injure or destroy any part of the Building
     shall not be taken into it without the written consent of the Landlord and
     the Landlord shall in all cases retain the right to prescribe the weight
     and proper position of all such articles and the times and routes for
     moving them into or out of the Building; the cost or repairing any damage
     done to the Building by the moving or keeping of any such articles on the
     Premises shall be paid by the Tenant.

3.   OTHER TENANTS

     The Tenant and his employees shall not in any way interfere with or annoy
     other occupants of the Building or those having business with them.

4.   NOTICE OF DEFECTS

     The Tenant shall give the Landlord or its agent prompt written notice of
     any accident to or any defect in the plumbing, heating, air-conditioning,
     mechanical or electrical apparatus or any other part of the Building which
     has come to the attention of the Tenant.

5.   VEHICLES AND ANIMALS

     No bicycles or other vehicles and no dog or other animal or bird shall be
     brought into or kept in the Building.

6.   VEHICLES AND ANIMALS

     Furniture, effects and supplies shall not be taken into or removed from the
     premises except at such time and in such manner as may be previously
     approved by the Landlord.

7.   NOISE

     The Tenant will not make or permit any improper noise in the Building and
     will not place any radio or television antenna on the roof or in any part
     of the inside or outside of the Building other than the inside of the
     Premises; and will not operate or permit to be operated any musical or
     sound producing instrument or device inside or outside the Premises which
     may be heard outside the Premises; and will not operate any electrical
     device from which may emanate electrical waves which may interfere with or
     impair radio or television broadcasting or reception from or in the
     building or the complex or elsewhere.

8.   SLEEPING QUARTERS

     No one shall use the Premises for sleeping quarters.

<PAGE>   31

9.   SECURITY

     The Landlord shall have the right:

     (a)  to require all persons entering and leaving the Building at hours
          other than normal business hours (which are defined as between 8:00
          a.m. and 6:00 p.m. Monday through Friday, excluding public or
          statutory holidays) as the Landlord may reasonably determine to
          identify themselves to a watchman by registration or otherwise and to
          establish their right to enter or leave; and

     (b)  to exclude or expel any peddler or beggar at any time from the
          Premises or the Building.

10.  WASHROOMS

     The Tenant and its employees shall use such water closets, other water
     apparatus and washroom facilities in the Building as shall be from time to
     time designated by the Landlord for use in connection with the Premises.
     The water closets and other water apparatus shall not be used for any
     purpose other than those for which they are constructed and no sweepings,
     rubbish, rags, ashes or other substances shall be thrown therein. Any
     damage resulting by misuse shall be borne by the Tenant by whom or by whose
     employees the same is caused. Tenants shall not let water run unless in
     actual use.

11.  WINDOWS

     The Tenant shall observe strict care not to allow windows admitting light
     into the Premises to be opened or remain open so as to admit rain or snow,
     or so as to interfere with the heating of the Premises or the
     air-conditioning of the Premises or of the Building. The Tenant will be
     responsible for any injury caused to the property of other tenants or to
     the property of the Landlord by failure on the part of the Tenant to
     observe this rule.

12.  LOCKS

     The Tenant shall not place any additional lock upon any door of the
     Building and shall not replace any locks upon any door of the Building.

13.  COOKING

     The Tenant shall not permit any cooking in the Premises without the written
     consent of the Landlord.

14.  PARKING

     The Tenant and its employees, invitees, visitors, and others doing business
     with it at the Premises shall not block the driveways or parking stalls in
     the parking lot of the Building by parking their vehicles in such a manner
     that such vehicles restrict the free flow of traffic or prevent other
     vehicles from entering designated parking stalls or in a manner in which
     one vehicle is using or hindering the use of more than one parking stall.
     There shall be no overnight parking, whatsoever without the prior written
     approval of the Landlord. Any vehicles violating these rules with respect
     to parking will be ticketed and/or towed away by the Landlord at the
     expense of the Tenant. No propane-powered vehicles shall be permitted in
     the indoor parking facilities of the Complex.

     The Tenant at the commencement of the Term of this lease and from time to
     time during the Term of this lease at the Landlord's request will provide
     the Landlord with a list of all employees of the Tenant together with the
     make, model, year and current licence umber of such employee's vehicle or
     vehicles.

                                       2

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