Document:

<PAGE>
                                                               EXHIBIT 10.19
                                LEASE AGREEMENT

                                by and between

                           SHORELINE INVESTMENTS V,

                       a California general partnership,

                                  as LANDLORD

                                      and

                          CyberSource Corporation, a

                             Delaware corporation,

                                   as TENANT

                            for Premises located at

                             1295 Charleston Road

                            Mountain View, CA 94043
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                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
<S>                                                                         <C>
1.      Parties...........................................................   1

2.      Demise of Premises................................................   1

3.      Term..............................................................   1

4.      Rent..............................................................   2

        A.      Time of Payment...........................................   2
        B.      Monthly Installment.......................................   2
        C.      Late Charge...............................................   2
        D.      Additional Rent...........................................   3
        E.      Place of Payment..........................................   3
        F.      Advance Payment...........................................   3

5.      Security Deposit..................................................   3

6.      Use of Premises...................................................   4

7.      Taxes and Assessments.............................................   4

        A.      Tenant's Property.........................................   4
        B.      Property Taxes............................................   4
        C.      Other Taxes...............................................   6

8.      Insurance.........................................................   6

        A.      Indemnity.................................................   6
        B.      Liability Insurance.......................................   6
        C.      Property Insurance........................................   7
        D.      Tenant's Insurance; Release of Landlord...................   7
        E.      Mutual Waiver of Subrogation..............................   8

9.      Utilities.........................................................   8

10.     Repairs and Maintenance...........................................   8

        A.      Landlord's Repairs........................................   8
        B.      Tenant's Repairs..........................................   9

11.     Common Area.......................................................  10

12.     Common Area Charges...............................................  11

13.     Alterations.......................................................  12

14.     Acceptance of the Premises........................................  13

15.     Default...........................................................  13

        A.      Events of Default.........................................  13
        B.      Remedies..................................................  15
</TABLE>

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<TABLE>
<S>                                                                         <C>
16.     Destruction.......................................................  17

        A.      Landlord's Duty to Restore................................  17
        B.      Landlord's Right to Terminate.............................  18
        C.      Tenant's Right to Terminate...............................  19
        D.      Abatement of Rent.........................................  19

17.     Condemnation......................................................  20

        A.      Definition of Terms.......................................  20
        B.      Rights....................................................  20
        C.      Total Taking..............................................  20
        D.      Partial Taking............................................  20

18.     Mechanics' Lien...................................................  21

19.     Inspection of the Premises........................................  21

20.     Compliance with Laws..............................................  21

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

        A.      Priority..................................................  22
        B.      Subsequent Security Instruments...........................  22
        C.      Documents.................................................  22
        D.      Tenant's Attornment.......................................  23
        E.      Lender....................................................  23

22.     Holding Over......................................................  23

23.     Notices...........................................................  23

24.     Attorney's Fees...................................................  24

25.     Nonassignment.....................................................  24

        A.      Landlord's Consent Required...............................  24
        B.      Transferee Information Required...........................  24

26.     Successors........................................................  25

27.     Mortgagee Protection..............................................  26

28.     Landlord Loan or Sale.............................................  26

29.     Surrender of Lease Not Merger.....................................  26

30.     Waiver............................................................  26

31.     General...........................................................  26

        A.      Captions..................................................  27
        B.      Definition of Landlord....................................  27
        C.      Time of Essence...........................................  27
        D.      Severability..............................................  27
        E.      Joint and Several Liability...............................  27
</TABLE>

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<TABLE>
<S>                                                                        <C>
        F.      Law.......................................................  27
        G.      Agent.....................................................  28
        H.      WAIVER OF JURY TRIAL......................................  28

32.     Sign..............................................................  28

33.     Interest on Past Due Obligations..................................  29

34.     Surrender of the Premises.........................................  29

35.     Authority.........................................................  29

36.     C.C. & R.'s.......................................................  29

37.     Brokers...........................................................  30

38.     Limitation on Landlord's Liability................................  30

39.     Hazardous Material................................................  31

        A.      Definitions...............................................  31
        B.      Permitted Use.............................................  31
        C.      Hazardous Materials Management Plan.......................  31
        D.      Use Restriction...........................................  33
        E.      Tenant Indemnity..........................................  33
        F.      Compliance................................................  34
        G.      Assignment and Subletting.................................  34
        H.      Surrender.................................................  34
        I.      Right to Appoint Consultant...............................  34
        J.      Holding Over..............................................  35
        K.      Provisions Survive Termination............................  35
        L.      Controlling Provisions....................................  35

40.     Interruption......................................................  35

41.     Quiet Possession..................................................  35

42.     Default by Landlord; Landlord's Liability.........................  36
</TABLE>

                                      iii
<PAGE>

                                LEASE AGREEMENT
                                ---------------

        1.    Parties. This Lease, dated for reference purposes as of November
              -------
3, 1999, is made by and between SHORELINE INVESTMENTS V, a California general
partnership ("Landlord"), and CyberSource Corporation, a Delaware corporation
("Tenant").

        2.    Demise of Premises. Landlord hereby leases to Tenant and Tenant
              ------------------
hereby leases from Landlord, upon the terms and conditions hereinafter set
forth, those certain premises (the "Premises") situated in the City of Mountain
View, County of Santa Clara, State of California, described as follows:
approximately seventy-two thousand (72,000) square feet of floor space commonly
known as 1295 Charleston Road, located in the building (the "Building"), as
shown cross-hatched on the site plan (the "Site Plan") attached hereto as
Exhibit "A". The Building is located on a parcel of land (the "Parcel")
containing other buildings (the Building and such other buildings are
hereinafter collectively referred to as the "Buildings") as shown on the Site
Plan, which Parcel is described in Exhibit "B" attached hereto. In the event
Landlord subdivides the Parcel in the future into two (2) or more legal parcels,
the term "Parcel" shall thereafter refer to the legal parcel on which the
Premises are located. Landlord shall not be required to make any alterations,
additions or improvements to the Premises and the Premises shall be leased to
Tenant in an "as-is" condition.

        3.    Term. The term of this Lease ("Lease Term") shall be for seven (7)
              ----
years, commencing on January 1, 2000 (the "Commencement Date") and ending on
December 31, 2006 unless sooner terminated pursuant to any provision hereof.
Notwithstanding said scheduled 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, but in such case
Tenant shall not be obligated to pay rent until possession of the Premises is
tendered to Tenant and the commencement and termination dates of this Lease
shall be revised to conform to the date of Landlord's delivery of possession.
Notwithstanding the foregoing, if Landlord has not delivered possession of the
Premises to Tenant on or before January 31, 2000, then Tenant shall have the
right to terminate this Lease by giving written notice of termination to
Landlord at any time after January 31, 2000, but prior to the time that Landlord
delivers possession of the Premises to Tenant. Upon giving of such notice of
termination by Tenant, this Lease shall terminate without liability of either
party to the other and Landlord shall return to Tenant any prepaid rent or
security deposit received by Landlord. Tenant's right to terminate this Lease as
provided above shall be Tenant's sole and exclusive remedy for Landlord's
failure to deliver possession of the Premises on or before January 31, 2000 or
any other date. Landlord shall permit Tenant to occupy the Premises prior to the
Commencement Date,

                                       1
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beginning November 15, 1999. Such occupancy prior to the Commencement Date shall
be subject to all the provisions of this Lease, including the obligation to pay
all Additional Rent (as defined in Paragraph 4D below), but excluding only the
obligation to pay the Monthly Installment of rent.

        4.    Rent.
              ----

              A. Time of Payment. Tenant shall pay to Landlord as rent for the
                 ---------------
Premises the respective sums specified in Subparagraph 4.B below (the "Monthly
Installment") each month in advance on the first day of each calendar month,
without deduction or offset, prior notice or demand, commencing on the
Commencement Date and continuing through the term of this Lease, together with
such additional rents as are payable by Tenant to Landlord under the terms of
this Lease. The Monthly Installment for any period during the Lease Term which
period is less than one (1) full month shall be a pro rata portion of the
Monthly Installment based upon a thirty (30) day month.

              B. Monthly Installment. The Monthly Installment of rent payable
                 -------------------
each month during the Lease Term shall be the following respective amounts
during the following time periods:

              TIME PERIOD                         MONTHLY INSTALLMENT
              -----------                         -------------------

              1/1/2000-12/31/2000                 $187,200.00
              1/1/2001-12/31/2001                 $187,200.00
              1/1/2002-12/31/2002                 $194,400.00
              1/1/2003-12/31/2003                 $201,600.00
              1/1/2004-12/31/2004                 $208,800.00
              1/1/2005-12/31/2005                 $216,000.00
              1/1/2006-12/31/2006                 $223,200.00

              C. Late Charge. Tenant 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 deed of trust covering the Premises. Accordingly, if
any installment of rent or any other sum due from Tenant shall not be received
by Landlord within ten (10) days after such amount shall be due, Tenant shall
pay to Landlord, as Additional Rent, a late charge equal to six percent (6%) of
such overdue amount. The parties hereby agree that such late charge represents a
fair and reasonable estimate of the costs Landlord will incur by reason of late
payment by Tenant. Acceptance of such late charge by Landlord shall in no event
constitute a waiver of Tenant's default with respect to such overdue amount, nor
prevent Landlord from exercising any of its other rights and remedies granted
hereunder.

                                       2
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              D. Additional Rent. All taxes, insurance premiums, Common Area
                 ---------------
Charges (as defined in Paragraph 12 below), late charges, costs and expenses
which Tenant is required to pay hereunder, together with all interest that may
accrue thereon pursuant to the provisions of this Lease in the event of Tenant's
failure to pay such amounts after notice to Tenant, and all reasonable damages,
costs, and attorneys' fees and expenses which Landlord may incur by reason of
any default of Tenant or failure on Tenant's part to comply with the terms of
this Lease, shall be deemed to be additional rent ("Additional Rent") and shall
be paid in addition to the Monthly Installment of rent, and, in the event of
nonpayment by Tenant, Landlord shall have all of the rights and remedies with
respect thereto as Landlord has for the nonpayment of the Monthly Installment of
rent.

              E. Place of Payment. Rent shall be payable in lawful money of the
                 ----------------
United States of America to Landlord at SHORELINE INVESTMENTS V, c/o Realprop
Development Company, 1710 Zanker Road, Suite 100, San Jose, California 95112 or
to such other person(s) or at such other place(s) as Landlord may designate in
writing.

              F. Advance Payment. Concurrently with the execution of this Lease,
                 ---------------
Tenant shall pay to Landlord the sum of One Hundred Eighty-seven Two Hundred
Dollars ($187,200.00) to be applied to the Monthly Installment of rent first
accruing under this Lease.

        5.    Security Deposit. Tenant shall deposit with Lessor the sum of Two
              ----------------
Hundred Thousand Dollars ($200,000.00) (the "Security Deposit") upon execution
of this Lease, to secure the faithful performance by Tenant of each term,
covenant and condition of this Lease. If Tenant shall at any time fail to make
any payment or fail to keep or perform any term, covenant or condition on its
part to be made or performed or kept under this Lease, Landlord may, but shall
not be obligated to and without waiving or releasing Tenant from any obligation
under this Lease, use, apply or retain the whole or any part of the Security
Deposit (A) to the extent of any sum due to Landlord; (B) to make any required
payment on Tenant's behalf; or (C) to compensate Landlord for any loss, damages,
attorney's fees or expense sustained by Landlord due to Tenant's default. In
such event, Tenant shall, within five (5) days of written demand by Landlord,
remit to Landlord sufficient funds to restore the Security Deposit to its
original sum. No interest shall accrue on the Security Deposit. Landlord shall
not be required to keep the Security Deposit separate from its general funds.
Should Tenant comply with all the terms, covenants, and conditions of this Lease
and at the end of the term of this Lease leave the Premises in the condition
required by this Lease, then said Security Deposit, less any sums owing to
Landlord or which Landlord is otherwise entitled to retain, shall be returned to
Tenant within thirty (30) days after the termination of this Lease and vacancy
of the Premises by Tenant.

                                       3
<PAGE>

        6.    Use of Premises. Tenant shall use the Premises only in conformance
              ---------------
with applicable governmental laws, regulations, rules and ordinances for the
purpose of general office, research and development, software development and
engineering, sales, and any related lawful purpose and for no other purpose.
Tenant shall indemnify, protect, defend, and hold Landlord harmless against any
loss, expense, damage, attorneys' fees or liability arising out of the failure
of Tenant to comply with any applicable law. Tenant shall not commit or suffer
to be committed, any waste upon the Premises, or any nuisance, or other acts or
things which may disturb the quiet enjoyment of any other tenant in the
buildings adjacent to the Premises, or allow any sale by auction upon the
Premises, or allow the Premises to be used for any unlawful purpose, or place
any loads upon the floor, walls or ceiling which endanger the structure, or
place any harmful liquids in the drainage system of the Building. No waste
materials or refuse shall be dumped upon or permitted to remain upon any part of
the Parcel outside of the Building, except in trash containers placed inside
exterior enclosures designated for that purpose by Landlord. No materials,
supplies, equipment, finished products or semifinished products, raw materials
or articles of any nature shall be stored upon or permitted to remain on any
portion of the Parcel outside of the Building. Tenant shall strictly comply with
the provisions of Paragraph 39 below.

        7.    Taxes and Assessments.
              ---------------------

              A. Tenant's Property. Tenant shall pay before delinquency any and
                 -----------------
all taxes and assessments, license fees and public charges levied, assessed or
imposed upon or against Tenant's fixtures, equipment, furnishings, furniture,
appliances and personal property installed or located on or within the Premises.
Tenant shall cause said fixtures, equipment, furnishings, furniture, appliances
and personal property to be assessed and billed separately from the real
property of Landlord. If any of Tenant's said personal property shall be
assessed with Landlord's real property, Tenant shall pay Landlord the taxes
attributable to Tenant within ten (10) days after receipt of a written statement
from Landlord setting forth the taxes applicable to Tenant's property.

              B. Property Taxes. Tenant shall pay, as Additional Rent, Tenant's
                 --------------
Pro Rata Share (as defined below) of all Property Taxes levied or assessed with
respect to the land comprising the Parcel and with respect to all buildings and
improvements located on the Parcel which become due or accrue during the term of
this Lease. Tenant shall pay such Property Taxes to Landlord on or before the
later of the following dates: (1) ten (10) days prior to the delinquency date;
or (2) twenty (20) days after receipt of billing. If Tenant fails to do so,
Tenant shall reimburse Landlord, on demand, for all interest, late fees and
penalties that the taxing authority charges Landlord. In the event Landlord's
mortgagee requires an impound for Property Taxes, then on the first day of each

                                       4
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month during the Lease Term, Tenant shall pay Landlord one twelfth (1/12) of its
annual share of such Property Taxes. Tenant's liability hereunder shall be
prorated to reflect the Commencement and termination dates of this Lease.

        As used in this Lease, the term "Tenant's Pro Rata Share" shall mean a
fraction, expressed as a percentage, the numerator of which is the number of
square feet of floor space contained in the Premises and the denominator of
which is the number of square feet of floor space contained in all of the
Buildings located on the Parcel. As of the Commencement Date, Tenant's Pro Rata
Share expressed as a fraction is 72,000/300,608 and expressed as a percentage is
23.95%.

        For the purpose of this Lease, "Property Taxes" means and includes all
taxes, assessments (including, but not limited to, assessments for public
improvements or benefits), taxes based on vehicles utilizing parking areas,
taxes based or measured by the rent paid, payable or received under this Lease,
taxes on the value, use, or occupancy of the Premises, the Buildings and/or the
Parcel, Environmental Surcharges, and all other governmental impositions and
charges of every kind and nature whatsoever, whether or not customary or within
the contemplation of the parties hereto and regardless of whether the same shall
be extraordinary or ordinary, general or special, unforeseen or foreseen, or
similar or dissimilar to any of the foregoing which, at any time during the
Lease Term, shall be applicable to the Premises, the Buildings and/or the Parcel
or assessed, levied or imposed upon the Premises, the Buildings and/or the
Parcel, or become due and payable and a lien or charge upon the Premises, the
Buildings and/or the Parcel, or any part thereof, under or by virtue of any
present or future laws, statutes, ordinances, regulations or other requirements
of any governmental authority whatsoever. The term "Environmental Surcharges"
shall mean and include any and all expenses, taxes, charges or penalties imposed
by the Federal Department of Energy, the Federal Environmental Protection
Agency, the Federal Clean Air Act, or any regulations promulgated thereunder or
any other local, state or federal governmental agency or entity now or hereafter
vested with the power to impose taxes, assessments, or other types of surcharges
as a means of controlling or abating environmental pollution or the use of
energy. The term "Property Taxes" shall not include any federal, state or local
net income, estate, or inheritance tax imposed on Landlord or any penalties or
late charges assessed for failing to pay the Property Taxes when due.

              C. Other Taxes. Tenant shall, as Additional Rent, pay or reimburse
                 -----------
Landlord for any tax based upon, allocable to, or measured by the area of the
Premises or the Buildings or the Parcel; or by the rent paid, payable or
received under this Lease; any tax upon or with respect to the possession,
leasing, operation, management, maintenance, alteration, repair, use or
occupancy of the Premises or any portion thereof; any privilege tax, excise tax,
business and occupation tax, gross receipts tax, sales and/or use tax, water
tax, sewer tax, employee tax, occupational license tax imposed upon Landlord or
Tenant with respect to the Premises; any tax upon this transaction or any

                                       5
<PAGE>

document to which Tenant is a party creating or transferring an interest or an
estate in the Premises.

        8.    Insurance.
              ---------

              A. Indemnity. Tenant agrees to indemnify, protect and defend
                 ---------
Landlord against and hold Landlord harmless from any and all claims, causes of
action, judgments, obligations or liabilities, and all reasonable expenses
incurred in investigating or resisting the same (including reasonable attorneys'
fees), on account of, or arising out of, the operation, maintenance, use or
occupancy of the Premises and the Parcel and all areas appurtenant thereto by
Tenant or Tenant's Agents (as defined in Paragraph 31G below). This Lease is
made on the express understanding that Landlord shall not be liable for, nor
suffer loss by reason of, injury to person or property, from whatever cause
(except for the active negligence or willful misconduct of Landlord), which in
any way may be connected with the operation, use or occupancy of the Premises
specifically including, without limitation, any liability for injury to the
person or property of Tenant or its Agents. Notwithstanding the foregoing,
Landlord shall not be indemnified for losses, damages, liabilities, judgments,
actions, claims, attorneys fees, costs and expenses arising from (i) the active
negligence or willful misconduct of Landlord or its Agents; (ii) Landlord's
violation of any governmental law, order or regulation unless Tenant has assumed
pursuant to the provisions of this Lease Landlord's obligations with respect to
such law, order or regulation; or (iii) a breach of Landlord's obligations under
this Lease; or (iv) any construction defects in the Buildings.

              B. Liability Insurance. Tenant shall, at Tenant's expense, obtain
                 -------------------
and keep in force during the term of this Lease a policy of commercial general
liability insurance insuring Landlord and Tenant against claims and liabilities
arising out of the operation, use, or occupancy of the Premises and all areas
appurtenant thereto, including parking areas. Such insurance shall be in an
amount of not less than Three Million Dollars ($3,000,000.00) for bodily injury
or death as a result of any one occurrence and Five Hundred Thousand Dollars
($500,000.00) for damage to property as a result of any one occurrence. The
insurance shall be with companies approved by Landlord, which approval Landlord
agrees not to withhold unreasonably. Tenant shall deliver to Landlord, prior to
possession, and at least thirty (30) days prior to the expiration thereof, a
certificate of insurance evidencing the existence of the policy required
hereunder and such certificate shall certify that the policy (1) names Landlord
as an additional insured, (2) shall not be canceled or altered without thirty
(30) days prior written notice to Landlord, (3) insures performance of the
indemnity set forth in Subparagraph 8.A above, (4) the coverage is primary and
any coverage by Landlord is in excess thereto and (5) contains a cross-liability
endorsement.

        Landlord may maintain a policy or policies of commercial general
liability insurance insuring

                                       6
<PAGE>

Landlord (and such others as are designated by Landlord), against liability for
personal injury, bodily injury, death and damage to property occurring or
resulting from an occurrence in, on or about the Premises or the Common Area,
with such limits of coverage as Landlord may from time to time determine are
reasonably necessary for its protection. The cost of any such liability
insurance maintained by Landlord shall be a Common Area Charge and Tenant shall
pay, as Additional Rent, Tenant's Pro Rata Share of such cost to Landlord as
provided in Paragraph 12 below.

              C. Property Insurance. Landlord shall obtain and keep in force
                 ------------------
during the term of this Lease a policy or policies of insurance covering loss or
damage to the Premises and the Buildings, in the amount of the full replacement
value thereof, providing protection against those perils included within the
classification of "all risk" insurance, plus a policy of rental income insurance
in the amount of one hundred percent (100%) of twelve (12) months rent
(including, without limitation, sums payable as Additional Rent), plus, at
Landlord's option, flood insurance and earthquake insurance, and any other
coverages which Landlord may from, time to time, elect to maintain or which may
be required from time to time by Landlord's Lender. Tenant shall have no
interest in nor any right to the proceeds of any insurance procured by Landlord
on the Premises. Tenant shall, within twenty (20) days after receipt of billing,
pay to Landlord as Additional Rent, Tenant's Pro Rata Share of such insurance
procured and maintained by Landlord. Tenant acknowledges that such insurance
procured by Landlord shall contain a deductible which reduces Tenant's cost for
such insurance and, in the event of loss or damage, Tenant shall be required to
pay to Landlord Tenant's Pro Rata Share of the amount of such deductible (not to
exceed Ten Thousand Dollars ($10,000.00)).

              D. Tenant's Insurance; Release of Landlord. Tenant acknowledges
                 ---------------------------------------
that the insurance to be maintained by Landlord on the Premises pursuant to
Subparagraph 8.C above will not insure any of Tenant's property. Accordingly,
Tenant, at Tenant's own expense, shall maintain in full force and effect on all
of its fixtures, equipment, leasehold improvements and personal property in the
Premises, a policy of "All Risk" coverage insurance to the extent of at least
ninety percent (90%) of their insurable value. Tenant hereby releases Landlord,
and its partners, officers, agents, employees, and servants, from any and all
claims, demands, losses, expenses or injuries to the Premises or to the
furnishings, fixtures, equipment, inventory or other personal property of Tenant
in, about, or upon the Premises, which are caused by perils, events or
happenings where the same are covered by the insurance required by this Lease or
which are the subject of insurance carried by Tenant and in force at the time of
such loss.

              E. Mutual Waiver of Subrogation. Tenant and Landlord hereby
                 ----------------------------
mutually waive their respective rights for recovery against each other for any
loss of or damage to the property of

                                       7
<PAGE>

either party, to the extent such loss or damage is insured by any insurance
policy required to be maintained by this Lease or otherwise in force at the time
of such loss or damage. Each party shall obtain any special endorsements, if
required by the insurer, whereby the insurer waives its right of subrogation
against the other party hereto. The provisions of this Subparagraph E shall not
apply in those instances in which waiver of subrogation would cause either
party's insurance coverage to be voided or otherwise made uncollectible.

        9.    Utilities. Tenant shall pay for all water, gas, light, heat,
              ---------
power, electricity, telephone, trash pick-up, sewer charges, and all other
services supplied to or consumed on the Premises, and all taxes and surcharges
thereon. In addition, the cost of any utility services supplied to the Common
Area or not separately metered to the Premises shall be a Common Area Charge and
Tenant shall pay Tenant's Pro Rata Share of such costs to Landlord as provided
in Paragraph 12 below.

        10.   Repairs and Maintenance.
              -----------------------

              A. Landlord's Repairs. Subject to the provisions of Paragraph 16,
                 ------------------
Landlord shall keep and maintain the exterior roof, structural elements and
exterior walls of the Building in good order and repair. Landlord shall not,
however, be required to maintain, repair or replace the interior surface of
exterior walls, nor shall Landlord be required to maintain, repair or replace
windows, doors, skylights or plate glass. Landlord shall have no obligation to
make repairs under this Subparagraph until a reasonable time after receipt of
written notice from Tenant of the need for such repairs. Tenant shall reimburse
Landlord, as Additional Rent, within fifteen (15) days after receipt of billing,
for the cost of such repairs and maintenance which are the obligation of
Landlord hereunder, provided however, that Tenant shall not be required to
reimburse Landlord for the cost of maintenance and repairs of the structural
elements of the Building unless such maintenance or repair is required because
of the negligence or willful misconduct of Tenant or its Agents. As used herein,
the term "structural elements of the Building" shall mean and be limited to the
foundation, footings, floor slab (but not flooring), structural walls, and roof
structure (but not roofing or roof membrane). Notwithstanding the foregoing, if
the roof surface or membrane requires replacement during the Lease Term, then
Landlord and Tenant shall share the cost of such replacement as follows: Tenant
shall pay a fraction of the cost of such replacement, which fraction shall have
as its numerator the number of months remaining in the Lease Term and shall have
as its denominator one hundred twenty (120) months. Landlord shall pay the
balance of the cost of such replacement. Tenant shall pay Tenant's share of the
costs of such replacement within fifteen (15) days after receipt of billing.

        Landlord warrants that the HVAC equipment shall be in good working order
on the

                                       8
<PAGE>

Commencement Date. If any HVAC equipment requires replacement (as opposed to
routine maintenance and repair) during the first six (6) months of the Lease
Term, Landlord shall perform such replacement at its sole cost and expense.
After the first six (6) months of the Lease Term, Tenant shall be responsible
for all repair, maintenance and replacement of the HVAC equipment in accordance
with Subparagraph B below.

              B. Tenant's Repairs. Except as expressly provided in Subparagraph
                 ----------------
10.A above, Tenant shall, at its sole cost, keep and maintain the entire
Premises and every part thereof, including without limitation, the windows,
window frames, plate glass, glazing, skylights, truck doors, doors and all door
hardware, the walls and partitions, and the electrical, plumbing, lighting,
heating, ventilating and air conditioning systems and equipment in good order,
condition and repair. The term "repair" shall include replacements, restorations
and/or renewals when necessary as well as painting. Tenant's obligation shall
extend to all alterations, additions and improvements to the Premises, and all
fixtures and appurtenances therein and thereto. Tenant shall, at all times
during the Lease Term, have in effect a service contract for the maintenance of
the heating, ventilating and air conditioning ("HVAC") equipment with an HVAC
repair and maintenance contractor approved by Landlord. The HVAC service
contract shall provide for periodic inspection and servicing at least once every
three (3) months during the term hereof, and Tenant shall provide Landlord with
a copy of such contract and all periodic service reports.

        Should Tenant fail to commence to make repairs required of Tenant
hereunder forthwith upon fifteen (15) days notice from Landlord or should Tenant
fail thereafter to diligently complete the repairs, Landlord, in addition to all
other remedies available hereunder or by law and without waiving any alternative
remedies, upon written notice to Tenant may make the same, and in that event,
Tenant shall reimburse Landlord as Additional Rent for the cost of such
maintenance or repairs within five (5) days of written demand by Landlord.

        Landlord shall have no maintenance or repair obligations whatsoever with
respect to the Premises except as expressly provided in Subparagraph 10.A and
Paragraph 11 and 16. Tenant hereby expressly waives the provisions of Subsection
1 of Section 1932 and Sections 1941 and 1942 of the Civil Code of California and
all rights to make repairs at the expense of Landlord as provided in Section
1942 of said Civil Code. Unless caused by Landlord's active negligence or
willful misconduct, there shall be no allowance to Tenant for diminution of
rental value, and no liability on the part of Landlord, by reason of
inconvenience, annoyance or injury to business arising from the making of, or
the failure to make, any repairs, alterations, decorations, additions or
improvements in or to any portion of the Premises or the Building or Common Area
(or any of the areas used in connection with the operation thereof, or in or to
any fixtures, appurtenances or equipment), or by

                                       9
<PAGE>

reason of the negligence of Tenant or any other tenant or occupant of the
Parcel. Unless caused by Landlord's active negligence or willful misconduct,
Tenant hereby agrees that Landlord shall not be liable for injury to Tenant's
business or any loss of income therefrom or for damage to the goods, wares,
merchandise or other property of Tenant, Tenant's employees, invitees,
customers, or any other person in or about the Premises, the Building, or the
Common Area, nor shall Landlord be liable for injury to the person of Tenant,
Tenant's employees, agents or contractors whether such damage or injury is
caused by or results from fire, steam, electricity, gas, water 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, whether the said damage or injury results from conditions arising upon
the Premises or upon other portions of the Building, or from other sources or
places and regardless of whether the cause of such damage or injury or the means
of repairing the same is inaccessible to Tenant. In no event shall Landlord be
responsible for any consequential damages arising or alleged to have arisen from
any of the foregoing matters. Landlord shall not be liable for any damages
arising from any act or neglect of any other tenant, if any, of the Buildings or
the Parcel.

        11.   Common Area. Subject to the terms and conditions of this Lease and
              -----------
such rules and regulations as Landlord may from time to time prescribe, Tenant
and Tenant's employees, invitees and customers shall, in common with other
occupants of the Parcel, and their respective employees, invitees and customers,
and others entitled to the use thereof, have the non-exclusive right to use the
access roads, parking areas and facilities provided and designated by Landlord
for the general use and convenience of the occupants of the Parcel, which areas
and facilities are referred to herein as "Common Area." The Common Area does not
include the inside portion of any Buildings. This right shall terminate upon the
termination of this Lease. Landlord reserves the right from time to time to make
changes in the shape, size, location, amount and extent of the Common Area,
provided that such changes shall not unreasonably interfere with Tenant's access
or use of the Premises or reduce the number of parking spaces to be provided for
Tenant under this Paragraph 11. Landlord further reserves the right to
promulgate such reasonable rules and regulations relating to the use of the
Common Area, and any part or parts thereof, as Landlord may deem appropriate for
the best interest of the occupants of the Parcel. The rules and regulations
shall be binding upon Tenant upon delivery of a copy of them to Tenant, and
Tenant shall abide by them and cooperate in their observance. Such rules and
regulations may be amended by Landlord from time to time, with or without
advance notice, and all amendments shall be effective upon delivery of a copy of
them to Tenant. No such rules and regulations shall (i) require Tenant to pay
additional Monthly Installment of rent or Additional Rent or materially decrease
Tenant's rights or materially increase Tenant's obligations under this Lease.
Tenant shall have the non-exclusive use of two hundred sixty-seven (267) of the
parking spaces in the Common Area as designated from time to time by Landlord.

                                       10
<PAGE>

Tenant shall not at any time park or permit the parking of Tenant's trucks or
other vehicles, or the trucks or other vehicles of others, adjacent to loading
areas so as to interfere in any way with the use of such areas, nor shall Tenant
at any time park or permit the parking of Tenant's vehicles or trucks, or the
vehicles or trucks of Tenant's suppliers or others, in any portion of the Common
Area not designated by Landlord for such use by Tenant. Tenant shall not abandon
any inoperative vehicles or equipment on any portion of the Common Area. Tenant
shall make no alterations, improvements or additions to the Common Area.

        Landlord shall operate, manage, insure, maintain and repair the Common
Area in good order, condition and repair. The manner in which the Common Area
shall be maintained and the expenditures for such maintenance shall be at the
reasonable discretion of Landlord. The cost of such repair, maintenance,
operation, insurance and management, including without limitation, maintenance
and repair of landscaping, irrigation systems, paving, sidewalks, fences, and
lighting, shall be a Common Area Charge and Tenant shall pay to Landlord its
share of such costs as provided in Paragraph 12 below.

        12.   Common Area Charges. Tenant shall pay to Landlord, as Additional
              -------------------
Rent, within ten (10) days after receipt of billing (together with reasonable
back-up information) upon demand but not more often than once each calendar
month, an amount equal to Tenant's Pro Rata Share of the Common Area Charges as
defined in Subparagraph 7.B and Paragraphs 9, 11, 13 and 36 of this Lease.
Tenant acknowledges and agrees that the Common Area Charges shall include an
additional five percent (5%) of the actual expenditures in order to compensate
Landlord for accounting, management and processing services. Provided Tenant
notifies Landlord within six (6) months after receipt of a detailed statement of
Tenant's Pro Rata Share of the Common Area Charges that Tenant disputes such
statements received from Landlord, Tenant or its CPA (as defined below) shall
have the right, at Tenant's sole cost and expense, provided Tenant utilizes a
Certified Public Accountant (the "CPA") compensated on an hourly basis, upon at
least thirty (30) days prior notice to Landlord at any time during regular
business hours to audit, review and photocopy Landlord's records pertaining to
Common Area Charges for the immediately previous calendar year only. Tenant
agrees to keep all information thereby obtained by Tenant confidential. If such
audit reveals that Landlord has overcharged Tenant, the amount overcharged shall
be credited to Tenant's account within thirty (30) days after the audit is
concluded. Notwithstanding anything to the contrary contained in this Lease,
Common Area Charges shall not include any of the following: (i) legal fees
incurred in Lease preparations; (ii) costs for which Landlord receives
reimbursement from insurance; (iii) bad debt or rent loss; (iv) reserves for
loss, interest or penalties resulting from Landlord's negligence; (v) costs
associated with the operation of Landlord's off-site business premises (except
for the five (5) percent administrative fee permitted above); (vi) advertising
and leasing costs; (vii) costs incurred as a result

                                       11
<PAGE>

of the active negligence or willful misconduct or violation of law by Landlord
or its Agents; (viii) costs for which Landlord obtains reimbursement from
others; (ix) fees, commissions, attorneys fees, costs or other disbursements
incurred in connection with negotiations or disputes with any other occupant of
the Buildings, if any, and costs arising from the violation by Landlord of the
terms and conditions of any lease or other agreement; (x) depreciation,
amortization or other expense reserves; (xi) costs and expenses for which Tenant
reimburses Landlord directly or which Tenant pays directly to a third person;
(xii) costs in the nature of management or administrative fees or expenses,
other than the five (5) percent administrative fee described in this Paragraph
12.

        13.   Alterations. Tenant shall not make, or suffer to be made, any
              -----------
alterations, improvements or additions in, on, about or to the Premises or any
part thereof, without the prior written consent of Landlord (which consent shall
not be unreasonably withheld or delayed) and without a valid building permit
issued by the appropriate governmental authority, if required; provided,
however, Landlord's consent shall not be required for non-structural changes to
the interior of the Premises which cost less than Fifteen Thousand Dollars
($15,000.00). As a condition to giving such consent, Landlord may require that
Tenant agree to remove any such alterations, improvements or additions at the
termination of this Lease, and to restore the Premises to their prior condition.
Unless Landlord requires that Tenant remove any such alteration, improvement or
addition, any alteration, addition or improvement to the Premises, except
movable furniture and trade fixtures not affixed to the Premises, shall become
the property of Landlord upon termination of the Lease and shall remain upon and
be surrendered with the Premises at the termination of this Lease. Without
limiting the generality of the foregoing, all heating, lighting, electrical
(including all wiring, conduit, outlets, drops, buss ducts, main and subpanels),
air conditioning, partitioning, drapery, and carpet installations made by Tenant
regardless of how affixed to the Premises, together with all other additions,
alterations and improvements that have become an integral part of the Building,
shall be and become the property of the Landlord upon termination of the Lease,
and shall not be deemed trade fixtures, and shall remain upon and be surrendered
with the Premises at the termination of this Lease.

        If, during the Term hereof, any alteration, addition or change of any
sort to all or any portion of the Premises is required by law, regulation,
ordinance or order of any public agency, Tenant shall promptly make the same at
its sole cost and expense. If during the Term hereof, any alteration, addition,
or change to the Common Area is required by law, regulation, ordinance or order
of any public agency, Landlord shall make the same and the cost of such
alteration, addition or change shall be a Common Area Charge and Tenant shall
pay Tenant's Pro Rata Share of said cost to Landlord as provided in Paragraph 12
above.

                                       12
<PAGE>

        14.   Acceptance of the Premises. By entry and taking possession of the
              --------------------------
Premises pursuant to this Lease, Tenant accepts the Premises as being in good
and sanitary order, condition and repair and accepts the Premises in their
condition existing as of the date of such entry. If any alterations to the
Premises are required by the Americans with Disabilities Act, Tenant shall make
such alterations at Tenant's sole cost. Tenant acknowledges that neither
Landlord nor Landlord's Agents has made any representation or warranty as to the
suitability of the Premises to the conduct of Tenant's business. Any agreements,
warranties or representations not expressly contained herein shall in no way
bind either Landlord or Tenant, and Landlord and Tenant expressly waive all
claims for damages by reason of any statement, representation, warranty, promise
or agreement, if any, not contained in this Lease. This Lease constitutes the
entire understanding between the parties hereto and no addition to, or
modification of, any term or provision of this Lease shall be effective until
set forth in a writing signed by both Landlord and Tenant.

        15.   Default.
              -------

              A. Events of Default. A breach of this Lease by Tenant shall
                 -----------------
exist if any of the following events (hereinafter referred to as "Event of
Default") shall occur:

                 (1)      Default in the payment when due of any
                          installment of rent or other payment required
                          to be made by Tenant hereunder, where such
                          default shall not have been cured within three
                          (3) days after written notice of such default
                          is given to Tenant. If Landlord serves Tenant
                          with a Notice to Pay or Quit pursuant to the
                          applicable unlawful detainer statutes, such
                          Notice to Pay or Quit shall also constitute
                          the written notice required by this clause;

                 (2)      Tenant's breach or violation of any of the provisions
                          of Paragraph 25 below;

                 (3)      Tenant's breach or violation of any of the provisions
                          of Paragraph 39 below;

                 (4)      Tenant's failure to perform any other term,
                          covenant or condition contained in this Lease
                          where such failure shall have continued for
                          twenty (20) days after written notice of such
                          failure is given to Tenant or if such failure
                          cannot be cured within said twenty (20) day
                          period, Tenant fails to commence to cure such
                          failure within said twenty (20) day period and
                          thereafter diligently completes such cure;

                                       13
<PAGE>

                 (5)      Tenant's vacating or abandonment of the Premises;

                 (6)      Tenant's assignment of its assets for the benefit of
                          its creditors;

                 (7)      The sequestration of, attachment of, or
                          execution on, any substantial part of the
                          property of Tenant or on any property
                          essential to the conduct of Tenant's business,
                          shall have occurred and Tenant shall have
                          failed to obtain a return or release of such
                          property within thirty (30) days thereafter,
                          or prior to sale pursuant to such
                          sequestration, attachment or levy, whichever
                          is earlier;

                 (8)      Tenant or any guarantor of Tenant's
                          obligations hereunder shall commence any case,
                          proceeding or other action seeking
                          reorganization, arrangement, adjustment,
                          liquidation, dissolution or composition of it
                          or its debts under any law relating to
                          bankruptcy, insolvency, reorganization or
                          relief of debtors, or seek appointment of a
                          receiver, trustee, custodian, or other similar
                          official for it or for all or any substantial
                          part of its property;

                 (9)      Tenant or any such guarantor shall take any corporate
                          action to authorize any of the actions set forth in
                          Clause 8 above; or

                 (10)     Any case, proceeding or other action against
                          Tenant or any guarantor of Tenant's
                          obligations hereunder shall be commenced
                          seeking to have an order for relief entered
                          against it as debtor, or seeking
                          reorganization, arrangement, adjustment,
                          liquidation, dissolution or composition of it
                          or its debts under any law relating to
                          bankruptcy, insolvency, reorganization or
                          relief of debtors, or seeking appointment of a
                          receiver, trustee, custodian or other similar
                          official for it or for all or any substantial
                          part of its property, and such case,
                          proceeding or other action (i) results in the
                          entry of an order for relief against it which
                          is not fully stayed within seven (7) business
                          days after the entry thereof or (ii) remains
                          undismissed for a period of forty-five (45)
                          days.

              B. Remedies. Upon any Event of Default, Landlord shall have the
                 --------
following remedies, in addition to all other rights and remedies provided by
law, to which Landlord may resort

                                       14
<PAGE>

cumulatively, or in the alternative:

                         (1)      Recovery of Rent. Landlord shall be entitled
                                  ----------------
                                  to keep this Lease in full force and effect
                                  (whether or not Tenant shall have abandoned
                                  the Premises) and to enforce all of its rights
                                  and remedies under this Lease, including the
                                  right to recover rent and other sums as they
                                  become due, plus interest at the Permitted
                                  Rate (as defined in Paragraph 33 below) from
                                  the due date of each installment of rent or
                                  other sum until paid.

                         (2)      Termination. Landlord may terminate this Lease
                                  -----------
                                  by giving Tenant written notice of
                                  termination. On the giving of the notice all
                                  of Tenant's rights in the Premises and the
                                  Building and Parcel shall terminate. Upon the
                                  giving of the notice of termination, Tenant
                                  shall surrender and vacate the Premises in the
                                  condition required by Paragraph 34, and
                                  Landlord may re-enter and take possession of
                                  the Premises and all the remaining
                                  improvements or property and eject Tenant or
                                  any of Tenant's subtenants, assignees or other
                                  person or persons claiming any right under or
                                  through Tenant or eject some and not others or
                                  eject none. This Lease may also be terminated
                                  by a judgment specifically providing for
                                  termination. Any termination under this
                                  paragraph shall not release Tenant from the
                                  payment of any sum then due Landlord or from
                                  any claim for damages or rent previously
                                  accrued or then accruing against Tenant. In no
                                  event shall any one or more of the following
                                  actions by Landlord constitute a termination
                                  of this Lease:

                                  (a)      maintenance and preservation of the
                                           Premises;

                                  (b)      efforts to relet the Premises;

                                  (c)      appointment of a receiver in order to
                                           protect Landlord's interest
                                           hereunder;

                                  (d)      consent to any subletting of the
                                           Premises or assignment of this Lease
                                           by Tenant, whether pursuant to
                                           provisions hereof concerning
                                           subletting and assignment or
                                           otherwise; or

                                       15
<PAGE>

                                  (e)      any other action by Landlord or
                                           Landlord's agents intended to
                                           mitigate the adverse effects from any
                                           breach of this Lease by Tenant.

                         (3)      Damages. In the event this Lease is terminated
                                  -------
                                  pursuant to Subparagraph 15.B.2 above, or
                                  otherwise, Landlord shall be entitled to
                                  damages in the following sums:

                                  (a)      the worth at the time of award of the
                                           unpaid rent which has been earned at
                                           the time of termination; plus

                                  (b)      the worth at the time of award of the
                                           amount by which the unpaid rent which
                                           would have been earned after
                                           termination until the time of award
                                           exceeds the amount of such rental
                                           loss that Tenant proves could have
                                           been reasonably avoided; plus

                                  (c)      the worth at the time of award of the
                                           amount by which the unpaid rent for
                                           the balance of the term after the
                                           time of award exceeds the amount of
                                           such rental loss that Tenant proves
                                           could be reasonably avoided; and

                                  (d)      any other amount necessary to
                                           compensate Landlord for all detriment
                                           proximately caused by Tenant's
                                           failure to perform Tenant's
                                           obligations under this Lease, or
                                           which in the ordinary course of
                                           things would be likely to result
                                           therefrom including, without
                                           limitation, the following: (i)
                                           expenses for cleaning, repairing or
                                           restoring the Premises; (ii) expenses
                                           for altering, remodeling or otherwise
                                           improving the Premises for the
                                           purpose of reletting, including
                                           installation of leasehold
                                           improvements (whether such
                                           installation be funded by a reduction
                                           of rent, direct payment or allowance
                                           to the succeeding lessee, or
                                           otherwise); (iii) real estate
                                           broker's fees, advertising costs and
                                           other expenses of reletting the
                                           Premises; (iv) costs of carrying the
                                           Premises such as taxes and insurance
                                           premiums thereon, utilities and
                                           security precautions; (v) expenses in
                                           retaking possession of the Premises;
                                           and (vi) reasonable attorney's fees
                                           and court costs.

                                       16
<PAGE>

                          (e)      The "worth at the time of award" of
                                   the amounts referred to in
                                   Subparagraphs (a) and (b) of this
                                   Paragraph 15.B(3) is computed by
                                   allowing interest at the Permitted
                                   Rate. The "worth at the time of
                                   award" of the amounts referred to in
                                   Subparagraph (c) of this Paragraph
                                   15.B(3) is computed by discounting
                                   such amount at the discount rate of
                                   the Federal Reserve Board of San
                                   Francisco at the time of award plus
                                   one percent (1%). The term "rent" as
                                   used in this Paragraph 15 shall
                                   include all sums required to be paid
                                   by Tenant to Landlord pursuant to the
                                   terms of this Lease.

        16      Destruction.
                -----------

                A.  Landlord's Duty to Restore. If the Premises are damaged by
                    --------------------------
any peril after the Commencement Date of this Lease, Landlord shall restore the
Premises unless the Lease is terminated by Landlord pursuant to Paragraph 16.B
or by Tenant pursuant to Paragraph 16.C. All insurance proceeds available from
the property damage insurance carried by Landlord pursuant to Paragraph 8.C
shall be paid to and become the property of Landlord. If this Lease is
terminated pursuant to either Paragraphs 16.B or 16.C, then all insurance
proceeds available from the insurance required to be carried by Tenant which
covers loss to property that is Landlord's property or would become Landlord's
property on the termination of this Lease shall be paid to and become the
property of Landlord. If this Lease is not so terminated, then upon receipt of
the insurance proceeds (if the loss is covered by insurance) and the issuance of
all necessary governmental permits, Landlord shall commence and diligently
prosecute to completion the restoration of the Premises, to the extent then
allowed by Law, to substantially the same condition in which the Premises were
immediately prior to such damage. Landlord's obligation to restore shall be
limited to the Premises as they existed as of the Commencement Date, excluding
any trade fixtures and/or personal property and/or alterations constructed or
installed by Tenant in the Premises. Tenant shall forthwith replace or fully
repair all trade fixtures installed by Tenant and existing at the time of such
damage or destruction.

                B.  Landlord's Right to Terminate. Landlord shall have the
                    -----------------------------
option to terminate this Lease in the event any of the following occurs, which
option may be exercised only by delivery to Tenant of a written notice of
election to terminate within thirty (30) days after the date of such damage:

                    (1)   The Premises are damaged by any peril either
                          (i) covered by the type of insurance Landlord
                          is required to carry pursuant to Paragraph 8.C
                          or

                                       17
<PAGE>

                          (ii) covered by valid and collectible insurance
                          actually carried by Landlord and in force at the time
                          of such damage or destruction, to such an extent that
                          the estimated restoration cost exceeds fifty percent
                          (50%) of the then actual replacement cost thereof.

                    (2)   The Premises are damaged by any peril both (i)
                          not covered by the type of insurance Landlord
                          is required to carry pursuant to Paragraph 8.C
                          and (ii) not covered by valid and collectible
                          insurance actually carried by Landlord and in
                          force at the time of such damage or
                          destruction, to such an extent that the
                          estimated restoration cost exceeds five
                          percent (5%) of the then actual replacement
                          cost thereof; provided, however, that Landlord
                          may not terminate this Lease pursuant to this
                          subparagraph if Tenant agrees in writing to
                          pay the amount by which the restoration cost
                          exceed five percent (5%) of the replacement
                          cost of the Premises and deposits with
                          Landlord an amount equal to the estimated
                          amount of such excess within thirty (30) days
                          after Landlord has notified Tenant with its
                          election to terminate this Lease pursuant to
                          this subparagraph.

                    (3)   The Premises are damaged by any peril during
                          the last twelve (12) months of the Lease Term
                          to such an extent that the estimated cost to
                          restore equals or exceeds an amount equal to
                          six (6) times the Monthly Installment of rent
                          then due; provided, however, that Landlord may
                          not terminate this Lease pursuant to this
                          subparagraph if Tenant, at the time of such
                          damage, has an express written option to
                          further extend the term of this Lease and
                          Tenant exercises such option to so further
                          extend the Lease Term within fifteen (15) days
                          following the date of such damage.

                    (4)   The Premises are damaged by any peril and, because of
                          the Laws then in force, (i) may not be restored to
                          substantially the same condition in which it was prior
                          to such damage, or (ii) if restored, may not be used
                          for the same use being made thereof before such
                          damage.

                C.  Tenant's Right to Terminate. If the Improvements are damaged
by any peril and Landlord does not elect to terminate this Lease or is not
entitled to terminate this Lease pursuant to Paragraph 14.B, then as soon as
reasonably practicable, Landlord shall furnish Tenant with the

                                       18
<PAGE>

written opinion of Landlord's architect or construction consultant as to when
the restoration work required of Tenant may be completed. Tenant shall have the
option to terminate this Lease in the event any of the following occurs, which
option may be exercised only by delivery to Landlord of a written notice of
election to terminate within fifteen (15) days after Tenant receives from
Landlord the estimate of the time needed to complete such restoration:

                         (1)      The Premises are damaged by any peril and, in
                                  the reasonable opinion of Landlord's architect
                                  or construction consultant, the restoration of
                                  the Premises cannot be substantially completed
                                  within two hundred seventy (270) days after
                                  the date of the damage.

                         (2)      The Premises are damaged by any peril within
                                  twelve (12) months of the last day of the
                                  Lease Term, and, in the reasonable opinion of
                                  Landlord's architect or construction
                                  consultant, the restoration of the Premises
                                  cannot be substantially completed within
                                  ninety (90) days after the date of such
                                  damage.

                    D.   Abatement of Rent. In the event of damage to the
                         -----------------
Premises which does not result in the termination of this Lease, the Monthly
Installment of rent and Additional Rent shall be temporarily abated during the
period of restoration in proportion to the degree to which Tenant's use of the
Premises is impaired by such damage. Tenant shall not be entitled to any
compensation from Landlord for loss of Tenant's property or loss to Tenant's
business caused by such damage or restoration. Tenant hereby waives the
provisions of Section 1932, Subdivision 2, and Section 1933, Subdivision 4, of
the California Civil Code, and the provisions of any similar law, hereinafter
enacted.

              17    Condemnation.
                    ------------

                    A.  Definition of Terms. For the purposes of this Lease, the
                        -------------------
term (1) "Taking" means a taking of the Premises or damage to the Premises
related to the exercise of the power of eminent domain and includes a voluntary
conveyance, in lieu of court proceedings, to any agency, authority, public
utility, person or corporate entity empowered to condemn property; (2) "Total
Taking" means the taking of the entire Premises or so much of the Premises or
Common Area as to prevent or substantially impair the use of the Premises by
Tenant for the uses herein specified; provided, however, in no event shall a
Taking of less than ten percent (10%) of the Common Area be deemed a Total
Taking; (3) "Partial Taking" means the taking of only a portion of the Premises
which does not constitute a Total Taking; (4) "Date of Taking" means the date
upon which the title

                                       19
<PAGE>

to the Premises, or a portion thereof, passes to and vests in the condemnor or
the effective date of any order for possession if issued prior to the date title
vests in the condemnor; and (5) "Award" means the amount of any award made,
consideration paid, or damages ordered as a result of a Taking.

                B.       Rights. The parties agree that in the event of a Taking
                         ------
all rights between them or in and to an Award shall be as set forth herein and
Tenant shall have no right to any Award except as set forth herein.

                C.       Total Taking. In the event of a Total Taking during the
                         ------------
term hereof (1) the rights of Tenant under the Lease and the leasehold estate of
Tenant in and to the Premises shall cease and terminate as of the Date of
Taking; (2) Landlord shall refund to Tenant any prepaid rent; (3) Tenant shall
pay Landlord any rent or charges due Landlord under the Lease, each prorated as
of the Date of Taking; (4) Tenant shall receive from Landlord those portions of
the Award attributable to trade fixtures of Tenant and for moving expenses of
Tenant; and (5) the remainder of the Award shall be paid to and be the property
of Landlord.

                D.       Partial Taking. In the event of a Partial Taking during
                         --------------
the term hereof (1) the rights of Tenant under the Lease and the leasehold
estate of Tenant in and to the portion of the Premises taken shall cease and
terminate as of the Date of Taking; (2) from and after the Date of Taking the
Monthly Installment of rent shall be an amount equal to the product obtained by
multiplying the Monthly Installment of rent immediately prior to the Taking by a
fraction, the numerator of which is the number of square feet contained in the
Premises after the Taking and the denominator of which is the number of square
feet contained in the Premises prior to the Taking; (3) Tenant shall receive
from the Award the portions of the Award attributable to trade fixtures of
Tenant; (4) the remainder of the Award shall be paid to and be the property of
Landlord; and (5) Landlord shall, to the extent of the Award received by it,
repair any damage to the remainder of the Premises caused by such Partial
Taking.

        18      Mechanics' Lien. Tenant shall (A) pay for all labor and services
                ---------------
performed for, materials used by or furnished to, Tenant or any contractor
employed by Tenant with respect to the Premises; (B) indemnify, defend, protect
and hold Landlord and the Premises harmless and free from any liens, claims,
liabilities, demands, encumbrances, or judgments created or suffered by reason
of any labor or services performed for, materials used by or furnished to,
Tenant or any contractor employed by Tenant with respect to the Premises; (C)
give notice to Landlord in writing five (5) days prior to employing any laborer
or contractor to perform services related to, or receiving materials for use
upon the Premises; and (D) permit Landlord to post a notice of nonresponsibility
in accordance

                                       20
<PAGE>

with the statutory requirements of California Civil Code Section 3094 or any
amendment thereof. In the event Tenant is required to post an improvement bond
with a public agency in connection with the above, Tenant agrees to include
Landlord as an additional obligee.

        19   Inspection of the Premises. Tenant shall permit Landlord and its
             --------------------------
Agents to enter the Premises at any reasonable time upon reasonable notice for
the purpose of inspecting the same, performing Landlord's maintenance and repair
responsibilities, posting a notice of non-responsibility for alterations,
additions or repairs and at any time within ninety (90) days prior to expiration
of this Lease, to place upon the Premises, ordinary "For Lease" or "For Sale"
signs.

        20   Compliance with Laws. Tenant shall, at its own cost, comply with
             --------------------
all of the requirements of all municipal, county, state and federal authorities
now in force, or which may hereafter be in force, pertaining to the use and
occupancy of the Premises, and shall faithfully observe all municipal, county,
state and federal law, statutes or ordinances now in force or which may
hereafter be in force. The judgment of any court of competent jurisdiction or
the admission of Tenant in any action or proceeding against Tenant, whether
Landlord be a party thereto or not, that Tenant has violated any such ordinance
or statute in the use and occupancy of the Premises shall be conclusive of the
fact that such violation by Tenant has occurred.

        21   Subordination. The following provisions shall govern the
             -------------
relationship of this Lease to any underlying lease, mortgage or deed of trust
which now or hereafter affects the Premises, the Building and/or the Parcel, or
Landlord's interest or estate therein (the "Project") and any renewal,
modification, consolidation, replacement, or extension thereof (a "Security
Instrument").

             A.   Priority. This Lease is subject and subordinate to all
                  --------
Security Instruments existing as of the Commencement Date. However, if any
Lender so requires, this Lease shall become prior and superior to any such
Security Instrument.

             B.   Subsequent Security Instruments. At Landlord's election, this
                  -------------------------------
Lease shall become subject and subordinate to any Security Instrument created
after the Commencement Date provided that the Lender holding such Security
Instrument agrees that in the event of foreclosure of the Security Instrument in
question, such Lender shall recognize the tenancy of Tenant on the terms and
conditions contained in this Lease so long as Tenant is not in default under
this Lease beyond any notice periods. Notwithstanding such subordination,
Tenant's right to quiet possession of the Premises shall not be disturbed so
long as Tenant is not in default beyond any notice periods and performs all of
its obligations under this Lease, unless this Lease is otherwise terminated
pursuant to its terms.

                                       21
<PAGE>

             C.   Documents. Tenant shall execute any reasonable document or
                  ---------
instrument required by Landlord or any Lender to make this Lease either prior or
subordinate to a Security Instrument, which may include such other matters as
the Lender customarily requires in connection with such agreements, including
provisions that the Lender, if it succeeds to the interest of Landlord under
this Lease, shall not be (i) liable for any act or omission of any prior
landlord (including Landlord), (ii) subject to any offsets or defenses which
Tenant may have against any prior landlord (including Landlord), (iii) bound by
any rent or Additional Rent paid more than one (1) month in advance of its date
due under this Lease unless the Lender receives it from Landlord, (iv) liable
for any defaults on the part of Landlord occurring prior to the time that the
Lender takes possession of the Premises in connection with the enforcement of
its Security Instrument, (v) liable for the return of any Security Deposit
unless such deposit has been delivered to Lender, or (vi) bound by any agreement
or modification of the Lease made without the prior written consent of Lender.
Tenant's failure to execute any such document or instrument with ten (10) days
after written demand therefor shall constitute a default by Tenant. Tenant's
obligation to execute and deliver any subordination agreement to any future
Lender shall be conditioned upon such Lender agreeing that in the event of
foreclosure of the Security Instrument in question, such Lender shall recognize
the tenancy of Tenant on the terms and conditions contained in this Lease so
long as Tenant is not in default under this Lease beyond any notice period.

             D.   Tenant's Attornment. Tenant shall attorn (1) to any purchaser
                  -------------------
of the Premises at any foreclosure sale or private sale conducted pursuant to
any Security Instrument encumbering the Premises; (2) to any grantee or
transferee designated in any deed given in lieu of foreclosure; or (3) to the
lessor under any underlying ground lease should such ground lease be terminated.

             E.   Lender. As used in this Lease, the term "Lender" shall mean
                  ------
(1) any beneficiary, mortgagee, secured party, or other holder of any deed of
trust, mortgage, or other written security device or agreement affecting the
Project; and (2) any lessor under any underlying lease under which Landlord
holds its interest in the Project.

        22   Holding Over. This Lease shall terminate without further notice at
             ------------
the expiration of the Lease Term. Any holding over by Tenant after expiration
shall not constitute a renewal or extension or give Tenant any rights in or to
the Premises except as expressly provided in this Lease. Any holding over after
the expiration with the consent of Landlord shall be construed to be a tenancy
from month to month, at one hundred fifty percent (150%) of the monthly rent for
the last month of the Lease Term, and shall otherwise be on the terms and
conditions herein specified insofar as applicable.

                                       22
<PAGE>

        23   Notices. Any notice required or desired to be given under this
             -------
Lease shall be in writing with copies directed as indicated below and shall be
personally served or given by mail. Any notice given by mail shall be deemed to
have been given when forty-eight (48) hours have elapsed from the time such
notice was deposited in the United States mails, certified and postage prepaid,
return receipt requested addressed to the party to be served with a copy as
indicated herein at the last address given by that party to the other party
under the provisions of this Paragraph 23, provided, however, if the Premises
are physically occupied by Tenant, notice of any default shall be deemed given
only upon receipt by Tenant (or upon Tenant's refusal or failure to accept
receipt). At the date of execution of this Lease, the address of Landlord is:

             SHORELINE INVESTMENTS V
             c/o Realprop Development Company
             1710 Zanker Road, Suite 100
             San Jose, CA 95112

and the address of Tenant is:

             CyberSource Corporation
             1295 Charleston Road
             Mountain View, CA 94043

        After the Commencement Date, the address of Tenant shall be at the
Premises.

        24   Attorney's Fees. In the event either party shall bring any action
             ---------------
 or legal proceeding for damages for any alleged breach of any provision of this
 Lease, to recover rent or possession of the Premises, to terminate this Lease,
 or to enforce, protect or establish any term or covenant of this Lease or right
 or remedy of either party, the prevailing party shall be entitled to recover as
 a part of such action or proceeding, reasonable attorneys' fees and court
 costs, including attorney's fees and costs for appeal, as may be fixed by the
 court or jury. The term "prevailing party" shall mean the party who received
 substantially the relief requested, whether by settlement, dismissal, summary
 judgment, judgment, or otherwise.

        25   Nonassignment.
             -------------

             A. Landlord's Consent Required. Tenant's interest in this Lease is
                ---------------------------
not assignable, by operation of law or otherwise, nor shall Tenant have the
right to sublet the Premises, transfer any interest of Tenant therein or permit
any use of the Premises by another party, without the prior written consent of
Landlord to such assignment, subletting, transfer or use, which consent Landlord
agrees not to withhold unreasonably subject to the provisions of Subparagraph
25.B below. A consent to one assignment, subletting, occupancy or use by another
party shall not be deemed to be a consent to any subsequent assignment,
subletting, occupancy or use by another party. Any

                                       23
<PAGE>

assignment or subletting without such consent shall be void and shall, at the
option of Landlord, terminate this Lease.

        Landlord's waiver or consent to any assignment or subletting hereunder
shall not relieve Tenant from any obligation under this Lease.

                B.  Transferee Information Required. If Tenant desires to assign
                    -------------------------------
its interest in this Lease or sublet the Premises, or transfer any interest of
Tenant therein, or permit the use of the Premises by another party (hereinafter
collectively referred to as a "Transfer"), Tenant shall give Landlord at least
fifteen (15) days prior written notice of the proposed Transfer and of the terms
of such proposed Transfer, including, but not limited to, the name and legal
composition of the proposed transferee, a financial statement of the proposed
transferee, the nature of the proposed transferee's business to be carried on in
the Premises, the payment to be made or other consideration to be given to
Tenant on account of the Transfer, and such other pertinent information as may
be requested by Landlord, all in sufficient detail to enable Landlord to
evaluate the proposed Transfer and the prospective transferee. It is the intent
of the parties hereto that this Lease shall confer upon Tenant only the right to
use and occupy the Premises, and to exercise such other rights as are conferred
upon Tenant by this Lease. The parties agree that this Lease is not intended to
have a bonus value nor to serve as a vehicle whereby Tenant may profit by a
future Transfer of this Lease or the right to use or occupy the Premises as a
result of any favorable terms contained herein, or future changes in the market
for leased space. It is the intent of the parties that any such bonus value that
may attach to this Lease shall be and remain the exclusive property of Landlord,
except as set forth in Paragraph 25.B(2) below. Accordingly, in the event Tenant
seeks to Transfer its interest in this Lease or the Premises, Landlord shall
have the following options, which may be exercised at its sole choice without
limiting Landlord in the exercise of any other right or remedy which Landlord
may have by reason of such proposed Transfer:

                    (1)      With respect to a proposed Transfer for
                             substantially the entire Premises for
                             substantially the entire remaining term of
                             this Lease, Landlord may elect to terminate
                             this Lease effective as of the proposed
                             effective date of the proposed Transfer and
                             release Tenant from any further liability
                             hereunder accruing after such termination date
                             by giving Tenant written notice of such
                             termination within fifteen (15) days after
                             receipt by Landlord of Tenant's notice of
                             intent to transfer as provided above. If
                             Landlord makes such election to terminate this
                             Lease, Tenant shall surrender the Premises, in
                             accordance with Paragraph 34, on or before the
                             effective termination date; or

                                       24
<PAGE>

                         (2)      Landlord may consent to the proposed Transfer
                                  on the condition that Tenant agrees to pay to
                                  Landlord, as Additional Rent, fifty percent
                                  (50%) of any and all rents or other
                                  consideration (including key money) received
                                  by Tenant from the transferee by reason of
                                  such Transfer in excess of the rent payable by
                                  Tenant to Landlord under this Lease (Landlord
                                  50%, Tenant 50%). In addition to the above
                                  allocation of Transfer profits, there is a One
                                  Thousand Five Hundred Dollars ($1,500.00)
                                  Documentation Fee to be paid to Landlord prior
                                  to Landlord approving the Transfer. Tenant
                                  expressly agrees that the foregoing is a
                                  reasonable condition for obtaining Landlord's
                                  consent to any Transfer; or

                         (3)      Landlord may reasonably withhold its consent
                                  to the proposed Transfer.

        26   Successors. The covenants and agreements contained in this Lease
             ----------
shall inure to the benefit of and be binding on the parties hereto and on their
respective heirs, successors and assigns (to the extent the Lease is
assignable).

        27   Mortgagee Protection. In the event of any default on the part of
             --------------------
Landlord, Tenant will give notice by registered or certified mail to any
beneficiary of a deed of trust or mortgagee of a mortgage encumbering the
Premises, whose address shall have been furnished to Tenant, and shall offer
such beneficiary or mortgagee a reasonable opportunity to cure the default,
including time to obtain possession of the Premises by power of sale or judicial
foreclosure, if such should prove necessary to effect a cure.

        28   Landlord Loan or Sale. Tenant agrees promptly following request by
             ---------------------
Landlord to (A) execute and deliver to Landlord any documents, including
estoppel certificates presented to Tenant by Landlord, (1) certifying that this
Lease is unmodified and in full force and effect (or, if modified, specifying
such modification and certifying that the Lease as so modified is in full force
and effect) and the date to which the rent and other charges are paid in
advance, if any, and (2) acknowledging that there are not any uncured defaults
on the part of Landlord hereunder (or specifying such defaults, if any, that are
claimed), and (3) evidencing the status of the Lease as may be required either
by a lender making a loan to Landlord to be secured by a deed of trust or
mortgage covering the Premises or a purchaser of the Premises from Landlord and
(B) to deliver to Landlord the financial statement of Tenant with an opinion of
a certified public accountant, including a balance sheet and profit and loss
statement, for the last completed fiscal year all prepared in

                                       25
<PAGE>

accordance with generally accepted accounting principles consistently applied.
Tenant's failure to deliver an estoppel certificate promptly following such
request shall be an Event of Default under this Lease.

        29   Surrender of Lease Not 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 Landlord, terminate all or any existing subleases or
subtenants, or operate as an assignment to Landlord of any or all such subleases
or subtenants.

        30   Waiver. The waiver by Landlord or Tenant of any breach of any term,
             ------
covenant or condition herein contained shall not be deemed to be a waiver of
such term, covenant or condition or any subsequent breach of the same or any
other term, covenant or condition herein contained.

        31   General.
             -------

             A.   Captions. The captions and paragraph headings used in this
                  --------
Lease are for the purposes of convenience only. They shall not be construed to
limit or extend the meaning of any part of this Lease, or be used to interpret
specific sections. The word(s) enclosed in quotation marks shall be construed as
defined terms for purposes of this Lease. As used in this Lease, the masculine,
feminine and neuter and the singular or plural number shall each be deemed to
include the other whenever the context so requires.

             B.   Definition of Landlord. The term LANDLORD as used in this
                  ----------------------
Lease, so far as the covenants or obligations on the part of Landlord are
concerned, shall be limited to mean and include only the owner at the time in
question of the fee title of the Premises, and in the event of any transfer or
transfers of the title of such fee, the Landlord herein named (and in case of
any subsequent transfers or conveyances, the then grantor) shall after the date
of such transfer or conveyance be automatically freed and relieved of all
liability with respect to performance of any covenants or obligations on the
part of Landlord contained in this Lease, 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 turned over to the grantee.
It is intended that the covenants and obligations contained in this Lease on the
part of Landlord shall, subject as aforesaid, be binding upon each Landlord, its
heirs, personal representatives, successors and assigns only during its
respective period of ownership.

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

                                       26
<PAGE>

             D.   Severability. In case any one or more of the provisions
                  ------------
contained herein, except for the payment of rent, shall for any reason be held
to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Lease, but this Lease shall be construed as if such invalid, illegal or
unenforceable provision had not been contained herein. This Lease shall be
construed and enforced in accordance with the laws of the State of California.

             E.   Joint and Several Liability. If Tenant is more than one person
                  ---------------------------
or entity, each such person or entity shall be jointly and severally liable for
the obligations of Tenant hereunder.

             F.   Law. As used in this Lease, the term "Law", "Laws", "law" or
                  ---
"laws" shall mean any judicial decision, statute, constitution, ordinance,
resolution, regulation, rule, administrative order, or other requirement of any
government agency or authority having jurisdiction over the parties to this
Lease or the Premises or both, in effect at the Commencement Date of this Lease
or any time during the Lease Term, including, without limitation, any
regulation, order, or policy of any quasi-official entity or body (e.g., board
                                                                   ----
of fire examiners, public utility or special district).

             G.   Agent. As used in this Lease, the term "Agent" shall mean,
                  -----
with respect to either Landlord or Tenant, its respective agents, employees,
contractors (and their subcontractors), and invitees (and in the case of Tenant,
its subtenants).

             H.   WAIVER OF JURY TRIAL.
                  --------------------

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

                                       27
<PAGE>

             INITIALS:  ______ (Landlord)                ______ (Tenant)

        32   Sign. Tenant shall not place or permit to be placed any sign or
             ----
decoration on the Parcel or the exterior of the Building without the prior
written consent of Landlord; provided that Tenant shall be allowed to use the
existing sign monument in front of the Building. Tenant, upon written notice by
Landlord, shall immediately remove any sign or decoration that Tenant has placed
or permitted to be placed on the Parcel or the exterior of the Building without
the prior written consent of Landlord, and if Tenant fails to so remove such
sign or decoration within five (5) days after Landlord's written notice,
Landlord may enter upon the Premises and remove said sign or decoration and
Tenant agrees to pay Landlord, as Additional Rent upon demand, the cost of such
removal. At the termination of this Lease, Tenant shall remove any sign which it
has placed on the Parcel or Building and shall repair any damage caused by the
installation or removal of such sign.

        33   Interest on Past Due Obligations. Any Monthly Installment of rent
             --------------------------------
or any other sum due from Tenant under this Lease which is received by Landlord
after the date the same is due shall bear interest from said due date until
paid, at an annual rate equal to the greater of (the "Permitted Rate"): (1) ten
percent (10%); or (2) five percent (5%) plus the rate established by the Federal
Reserve Bank of San Francisco, as of the twenty-fifth (25th) day of the month
immediately preceding the due date, on advances to member banks under Sections
13 and 13(a) of the Federal Reserve Act, as now in effect or hereafter from time
to time amended. Payment of such interest shall not excuse or cure any default
by Tenant. In addition, Tenant shall pay all costs and attorneys' fees incurred
by Landlord in collection of such amounts.

        34   Surrender of the Premises. On the last day of the Term hereof, or
             -------------------------
on the sooner termination of this Lease, Tenant shall surrender the Premises to
Landlord in their condition existing as of the Commencement Date of this Lease,
ordinary wear and tear excepted, with all painted interior walls washed, and
other interior walls cleaned, and repaired or replaced, all carpets shampooed
and cleaned, the air conditioning and heating equipment serviced and repaired by
a reputable and licensed service firm, all floors cleaned and waxed, all to the
reasonable satisfaction of Landlord. Tenant shall remove all of Tenant's
personal property, trade fixtures and any above the ceiling cable and wiring
abandoned by the Tenant from the Premises, and all property not so removed shall
be deemed abandoned by Tenant. Tenant, at its sole cost, shall repair any damage
to the Premises caused by the removal of Tenant's personal property, machinery
and equipment, which repair shall include, without limitation, the patching and
filling of holes and repair of structural damage. If the Premises are not so
surrendered at the termination of this Lease, Tenant shall indemnify, defend,
protect and hold Landlord harmless from and against loss or liability resulting

                                       28
<PAGE>

from delay by Tenant in so surrendering the Premises including without
limitation, any claims made by any succeeding tenant or losses to Landlord due
to lost opportunities to lease to succeeding tenants.

        35   Authority. The undersigned parties hereby warrant that they have
             ---------
proper authority and are empowered to execute this Lease on behalf of Landlord
and Tenant, respectively.

        36   C. C. & R.'s. This Lease is made subject to all matters of public
             ------------
record affecting title to the property of which the Premises are a part. Tenant
shall abide by and comply with all private conditions, covenants and
restrictions of public record now or hereafter affecting the Premises and any
amendment thereof, including, but not limited to, the following:

                    Those Covenants, Conditions and Restrictions for
             the SHORELINE BUSINESS PARK regarding Architectural
             Control, Development and Use executed by New England
             Mutual Life Insurance Company and recorded on June 1,
             1979, in Book E535 at page 233, Santa Clara County
             records.

        All assessments and charges which are imposed, levied or assessed
against the Parcel and Buildings pursuant to the above-described covenants,
conditions and restrictions shall be a Common Area Charge and Tenant shall pay
its share of such assessments and charges to Landlord as provided in Paragraph
12 above.

        37   Brokers. Tenant represents and warrants to Landlord that it has not
             -------
dealt with any broker respecting this transaction (other than CRESA PARTNERS and
CORNISH & CAREY) and hereby agrees to indemnify and hold Landlord harmless from
and against any brokerage commission or fee, obligation, claim or damage
(including attorneys' fees) paid or incurred respecting any broker (other than
CRESA PARTNERS and CORNISH & CAREY) claiming through Tenant or with which/whom
Tenant has dealt.

        38   Limitation on Landlord's Liability. Tenant, for itself and its
             ----------------------------------
successors and assigns (to the extent this Lease is assignable), hereby agrees
that in the event of any actual, or alleged, breach or default by Landlord under
this Lease that:

             A.   Tenant's sole and exclusive remedy against Landlord shall be
as against Landlord's interest in the Building and Parcel;

             B.   No partner of Landlord shall be sued or named in a party in a
suit or action

                                       29
<PAGE>

(except as may be necessary to secure jurisdiction of the partnership);

             C.   No service of process shall be made against any partner of
Landlord (except as may be necessary to secure jurisdiction of the partnership);

             D.   No partner of Landlord shall be required to answer or
otherwise plead to any service of process;

             E.   No judgment will be taken against any partner of Landlord;

             F.   Any judgment taken against any partner of Landlord may be
vacated and set aside at any time nunc pro tunc;

             G.   No writ of execution will ever be levied against the assets of
any partner of Landlord;

             H.   The covenants and agreements of Tenant set forth in this
Paragraph 38 shall be enforceable by Landlord and any partner of Landlord.

                                       30
<PAGE>

        39   Hazardous Material.
             ------------------

             A.   Definitions. As used herein, the term "Hazardous Material"
                  -----------
shall mean any substance: (i) the presence of which requires investigation or
remediation under any federal, state or local statute, regulation, ordinance,
order, action, policy or common law; (ii) which is or becomes defined as a
"hazardous waste," "hazardous substance," pollutant or contaminant under any
federal, state or local statute, regulation, rule or ordinance or amendments
thereto including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. Section 9601 et seq.) and/or the
Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.); (iii)
which is toxic, explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic, or otherwise hazardous and is or becomes regulated by
any governmental authority, agency, department, commission, board, agency or
instrumentality of the United States, the State of California or any political
subdivision thereof; (iv) the presence of which on the Premises causes or
threatens to cause a nuisance upon the Premises or to adjacent properties or
poses or threatens to pose a hazard to the health or safety of persons on or
about the Premises; (v) the presence of which on adjacent properties could
constitute a trespass by Landlord or Tenant; (vi) without limitation which
contains gasoline, diesel fuel or other petroleum hydrocarbons; (vii) without
limitation which contains polychlorinated biphenyls (PCBs), asbestos or urea
formaldehyde foam insulation; or (viii) without limitation radon gas.

             B.   Permitted Use. Subject to the compliance by Tenant with the
                  -------------
provisions of Subparagraphs C, D, E, F, G, H, and I below, Tenant shall be
permitted to use and store on the Premises those Hazardous Materials listed in
Exhibit "C" attached hereto, in the quantities set forth in Exhibit "C", and
reasonable quantities of customary office and janitorial supplies.

             C.   Hazardous Materials Management Plan.
                  -----------------------------------

                  (i)      Prior to Tenant using, handling, transporting or
                           storing any Hazardous Material at or about the
                           Premises (including, without limitation, those listed
                           in Exhibit "C"), Tenant shall submit to Landlord a
                           Hazardous Materials Management Plan ("HMMP") for
                           Landlord's review and approval, which approval shall
                           not be unreasonably withheld. The HMMP shall
                           describe: (aa) the quantities of each material to be
                           used, (bb) the purpose for which each material is to
                           be used, (cc) the method of storage of each material,
                           (dd) the method of transporting each material to and
                           from the Premises and within the Premises, (ee) the
                           methods Tenant will employ to monitor the use of the
                           material and to

                                       31
<PAGE>

                           detect any leaks or potential hazards, and (ff) any
                           other information any department of any governmental
                           entity (city, state or federal) requires prior to the
                           issuance of any required permit for the Premises or
                           during Tenant's occupancy of the Premises. Landlord
                           may, but shall have no obligation to review and
                           approve the foregoing information and HMMP, and such
                           review and approval or failure to review and approve
                           shall not act as an estoppel or otherwise waive
                           Landlord's rights under this Lease or relieve Tenant
                           of its obligations under this Lease. If Landlord
                           determines in good faith by inspection of the
                           Premises or review of the HMMP that the methods in
                           use or described by Tenant are not adequate in
                           Landlord's good faith judgment to prevent or
                           eliminate the existence of environmental hazards,
                           then Tenant shall not use, handle, transport, or
                           store such Hazardous Materials at or about the
                           Premises unless and until such methods are approved
                           by Landlord in good faith and added to an approved
                           HMMP. Once approved by Landlord, Tenant shall
                           strictly comply with the HMMP and shall not change
                           its use, operations or procedures with respect to
                           Hazardous Materials without submitting an amended
                           HMMP for Landlord's review and approval as provided
                           above.

                  (ii)     Tenant shall pay to Landlord when Tenant submits an
                           HMMP (or amended HMMP) the amount reasonably
                           determined by Landlord to cover all Landlord's costs
                           and expenses reasonably incurred in connection with
                           Landlord's review of the HMMP which costs and
                           expenses shall include, among other things, all
                           reasonable out-of-pocket fees of attorneys,
                           architects, or other consultants incurred by Landlord
                           in connection with Landlord's review of the HMMP.
                           Landlord shall have no obligation to consider a
                           request for consent to a proposed HMMP unless and
                           until Tenant has paid all such costs and expenses to
                           Landlord, and Tenant shall pay all such costs and
                           expenses to Landlord irrespective of whether Landlord
                           consents to such proposed HMMP. Tenant shall pay to
                           Landlord on demand the excess, if any, of such costs
                           and expenses actually incurred by Landlord over the
                           amount of such costs and expenses actually paid by
                           Tenant, and Landlord shall promptly refund to Tenant
                           the excess, if any, of such costs and expenses
                           actually paid by Tenant over the amount of such costs
                           and expenses actually incurred by Landlord.

                                       32
<PAGE>

             D.   Use Restriction. Except as specifically allowed in
                  ---------------
Subparagraph B above, Tenant shall not cause or permit any Hazardous Material to
be used, stored, generated, discharged, transported to or from, or disposed of
in or about the Premises, Building or Parcel, or any other land or improvements
in the vicinity of the Premises, Building or Parcel. Without limiting the
generality of the foregoing, Tenant, at its sole cost, shall comply with all
Laws relating to the storage, use, generation, transport, discharge and disposal
by Tenant or its Agents of any Hazardous Material. If the presence of any
Hazardous Material on the Premises, Building or Parcel caused or permitted by
Tenant or its Agents results in contamination of the Premises, Building or
Parcel or any soil, air, ground or surface waters under, through, over, on, in
or about the Premises, Building or Parcel, Tenant, at its expense, shall
promptly take all actions necessary to return the Premises, Building, Parcel
and/or the surrounding real property to the condition existing prior to the
appearance of such Hazardous Material. In the event there is a release,
discharge or disposal of or contamination of the Premises, Building or Parcel by
a Hazardous Material which is of the type that has been stored, handled,
transported or otherwise used or permitted by Tenant or its Agents on or about
the Premises, Building or Parcel, Tenant shall have the burden of proving that
such release, discharge, disposal or contamination is not the result of the acts
or omissions of Tenant or its Agents.

             E.   Tenant Indemnity. Tenant shall defend, protect, hold harmless
                  ----------------
and indemnify Landlord and its Agents and Lenders with respect to all actions,
claims, losses (including, diminution in value of the Premises), fines,
penalties, fees (including, but not limited to, attorneys' and consultants'
fees) costs, damages, liabilities, remediation costs, investigation costs,
response costs and other expenses arising out of, resulting from, or caused by
any Hazardous Material used, generated, discharged, transported to or from,
stored, or disposed of by Tenant or its Agents in, on, under, over, through or
about the Premises, Building, Parcel and/or the surrounding real property.
Tenant shall not suffer any lien to be recorded against the Premises, Building
or Parcel as a consequence of the disposal of any Hazardous Material on the
Premises, Building or Parcel by Tenant or its Agents, including any so called
state, federal or local "super fund" lien related to the "clean up" of any
Hazardous Material in, over, on, under, through, or about the Premises, Building
or Parcel.

             F.   Compliance. Tenant shall immediately notify Landlord of any
                  ----------
inquiry, test, investigation, enforcement proceeding by or against Tenant or the
Premises concerning any Hazardous Material. Any remediation plan prepared by or
on behalf of Tenant must be submitted to Landlord prior to conducting any work
pursuant to such plan and prior to submittal to any applicable government
authority and shall be subject to Landlord's consent. Tenant acknowledges that
Landlord, as the owner of the Premises, at its election, shall have the sole
right to negotiate,

                                       33
<PAGE>

defend, approve and appeal any action taken or order issued with regard to any
Hazardous Material by any applicable governmental authority.

             G.   Assignment and Subletting. It shall not be unreasonable for
                  -------------------------
Landlord to withhold its consent to any proposed assignment or subletting if (i)
the proposed assignee's or subtenant's anticipated use of the Premises involves
the storage, generation, discharge, transport, use or disposal of any Hazardous
Material; (ii) if the proposed assignee or subtenant has been required by any
prior landlord, lender or governmental authority to "clean up" or remediate any
Hazardous Material; (iii) if the proposed assignee or subtenant is subject to
investigation or enforcement order or proceeding by any governmental authority
in connection with the use, generation, discharge, transport, disposal or
storage of any Hazardous Material.

             H.   Surrender. Upon the expiration or earlier termination of the
                  ---------
Lease, Tenant, at its sole cost, shall remove all Hazardous Materials from the
Premises, Building and Parcel that Tenant or its Agents introduced to the
Premises, Building and/or Parcel. If Tenant fails to so surrender the Premises,
Tenant shall indemnify, protect, defend and hold Landlord harmless from and
against all damages resulting from Tenant's failure to surrender the Premises as
required by this Paragraph, including, without limitation, any actions, claims,
losses, liabilities, fees (including, but not limited to, attorneys' and
consultants' fees), fines, costs, penalties, or damages in connection with the
condition of the Premises including, without limitation, damages occasioned by
the inability to relet the Premises or a reduction in the fair market and/or
rental value of the Premises by reason of the existence of any Hazardous
Material in, on, over, under, through or around the Premises.

             I.   Right to Appoint Consultant. Landlord shall have the right to
                  ---------------------------
appoint a consultant to conduct an investigation to determine whether any
Hazardous Material is being used, generated, discharged, transported to or from,
stored or disposed of in, on, over, through, or about the Premises, in an
appropriate and lawful manner. If Tenant has violated any Law or covenant in
this Lease regarding the use, storage or disposal of Hazardous Materials on or
about the Premises, Tenant shall reimburse Landlord for the cost of such
investigation. Tenant, at its expense, shall comply with all reasonable
recommendations of the consultant required to conform Tenant's use, storage or
disposal of Hazardous Materials to the requirements of applicable Law or to
fulfill the obligations of Tenant hereunder.

             J.   Holding Over. If any action of any kind is required or
                  ------------
requested to be taken by any governmental authority to clean-up, remove,
remediate or monitor any Hazardous Material (the presence of which is the result
of the acts or omissions of Tenant or its Agents) and such action is not
completed prior to the expiration or earlier termination of the Lease, Tenant
shall be deemed to

                                       34
<PAGE>

have impermissibly held over until such time as such required action is
completed, and Landlord shall be entitled to all damages directly or indirectly
incurred in connection with such holding over, including without limitation,
damages occasioned by the inability to re-let the Premises or a reduction of the
fair market and/or rental value of the Premises.

             K.   Provisions Survive Termination. The provisions of this
                  ------------------------------
Paragraph 39 shall survive the expiration or termination of this Lease.

             L.   Controlling Provisions. The provisions of this Paragraph 39
                  ----------------------
are intended to govern the rights and liabilities of the Landlord and Tenant
hereunder respecting Hazardous Materials to the exclusion of any other
provisions in this Lease that might otherwise be deemed applicable. The
provisions of this Paragraph 39 shall be controlling with respect to any
provisions in this Lease that are inconsistent with this Paragraph 39.

        40   Interruption. If, as a result of the active negligence or willful
             ------------
misconduct of Landlord, the Premises should become unsuitable for Tenant's use
as a consequence of the cessation of utilities or other services, interference
with access to the Premises, legal restriction or the presence of any Hazardous
Materials and in any of the foregoing cases the interference with Tenant's
intended use of the Premises continues for a period of seven (7) days or more,
Tenant shall be entitled to an equitable abatement of Base Monthly Rent and
Additional Rent from the date of the first occurrence through the time in which
the Premises are suitable for Tenant's intended use. If such interruption
continues for a period of thirty (30)) consecutive days or more, Tenant shall be
entitled to terminate this Lease, upon written notice to Landlord.

        41   Quiet Possession. Tenant shall peacefully have, hold and enjoy the
             ----------------
Premises, subject to the other terms of this Lease, provided that Tenant pays
the Monthly Installment of rent and Additional Rent and performs all of Tenant's
covenants and agreement contained in this Lease.

        42   Default by Landlord; Landlord's Liability. Landlord shall not be in
             -----------------------------------------
default unless Landlord fails to perform obligations required of Landlord within
a reasonable time, but in no event earlier than thirty (30) days after written
notice by Tenant to Landlord and, if required by Landlord's Lender, to the
holder of any first mortgage or deed of trust covering the Premises whose name
and address shall have heretofore been furnished to Tenant in writing,
specifying wherein Landlord has failed to perform such obligations; provided,
however, that if the nature of Landlord's obligations is such that more than
thirty (30) days are required for performance, then Landlord shall not be in
default if Landlord commences performance within such thirty (30) day period and
thereafter diligently prosecutes the same to completion. In the event that
Landlord fails to complete performance (or to commence completion, as
applicable) or fails to diligently prosecute the same

                                       35
<PAGE>

to completion within such thirty (30) day period, Tenant may, at any time
thereafter, cure the default. If Tenant, at any time, by reason of Landlord's
default, pays any reasonable amount in excess of the amounts Tenant would have
otherwise paid on account thereof as Additional Rent, the reasonable amount paid
by Tenant (in excess of what Tenant would have otherwise paid) in order to
complete Landlord's performance shall be due immediately from Landlord to Tenant
within ten (10) days after written notice.

        IN WITNESS WHEREOF, the parties have executed this Agreement on the
dates set forth below.

                                        TENANT:
                                        CyberSource Corporation, a
                                        Delaware corporation

DATED: November 11, 1999                By: /s/  Charles E. Noreen
                                        Name: Charles E. Noreen
                                        Title: Vice President of Finance and
                                        Administration and Chief Financial
                                        Officer

                                        LANDLORD:

                                        SHORELINE INVESTMENTS V, a
                                        California general partnership

DATED: November 15, 1999                By: /s/  Robert P. Moore
                                        Name: Robert P. Moore
                                        Title: General Partner
                                               ---------------

DATED: November 15, 1999                By: /s/  John J. Bertolotti
                                        Name: John J. Bertolotti
                                        Title: General Partner
                                               ---------------

                                       36
<PAGE>

                                  EXHIBIT "A"

      [Graphics entitled "Site Plan", showing Premises as cross-hatched]
<PAGE>

                                  EXHIBIT "B"

         [Graphics showing legal description of Parcel APN 116-11-030]
          -----------------------------------------------------------
<PAGE>

                                  EXHIBIT "C"

            List of Hazardous Materials Tenant will use on Premises
            -------------------------------------------------------
                            (if none, write "none")

None

        TYPE OF MATERIAL                                    QUANTITY
        ----------------                                    --------<PAGE>

                                                                   EXHIBIT 10.22

                      CO-BRANDING AND PROMOTION AGREEMENT

     This Co-Branding and Promotion Agreement (the "Agreement") is entered into
as of December 10, 1999 (the "Effective Date") by and between eBay Inc., a
Delaware corporation with its principal place of business at 2125 Hamilton
Avenue, San Jose, California 95125 ("eBay"), and E-Stamp Corporation, a Delaware
corporation with its principal place of business at 2855 Campus Drive, Suite
100, San Mateo, California 94403 ("E-Stamp").

                                   Background

     A.  eBay operates a website for the online, person-to-person trading of
various items in an auction format.

     B.  E-Stamp is an online electronic provider of United States Postal
Service ("USPS") postage.

     C.  eBay and E-Stamp desire to cooperate to develop and launch a co-branded
area on E-Stamp's website, so as to allow eBay Users (defined below) to use the
E-Stamp Service (defined below) and related co-branded products in a convenient
manner. Further, eBay desires to promote E-Stamp as the exclusive U.S. online
electronic provider of USPS postage for eBay Users on the eBay Site (defined
below). This relationship is further described below and is subject to the terms
and conditions set forth in this Agreement.

                                   Agreement

1.   Certain Definitions.

     1.1    "Acquired User" means an eBay User that: (i) (a) links from the eBay
Site to the E-Stamp Site (including any Co-Branded Pages, defined below), or (b)
is referred to E-Stamp by eBay in some other manner that is traceable by E-
Stamp, and (ii) registers for or purchases any product or service offered by E-
Stamp. For clarification, an eBay User who at one time registers for a product
or service, and then subsequently purchases a product from E-Stamp (or first
purchases, and then registers, whatever the case may be) shall be deemed a
single Acquired User, and shall not be "double-counted."

     1.2    "Co-Branded Pages" means the eBay/E-Stamp co-branded pages hosted by
E-Stamp, which pages will be designed, implemented and maintained by E-Stamp,
subject to eBay's prior approval, which shall not be unreasonably withheld or
delayed.

     1.3    "Co-Branded Service Products" means the products provided by E-Stamp
that are directly related to the E-Stamp Service, including without limitation,
online postage and labels, and co-branded using the eBay Marks, as further
described in this Agreement.

     1.4    "Co-Branded Supplies" means postage supplies and other products
provided by E-Stamp that are ancillary to the E-Stamp Service, including without
limitation, postage scales, envelopes and Avery labels co-branded using the eBay
Marks, as further described in this Agreement.

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       1.

<PAGE>

     1.5    "Cumulative Acquired Users" means the total number of Acquired Users
that have been attained by E-Stamp during a Year.

     1.6    "eBay Content" means all content or information, in any medium,
provided by eBay for use on the Co-Branded Pages, including without limitation
any listing data, hyperlinks, text, music, sound, photographs, video, graphics,
other data or software.

     1.7    "eBay Marks" mean the domain names, trademarks and logos and other
branding elements designated by eBay from time to time for use under this
Agreement.

     1.8    "eBay Site" means: (i) the website owned and operated by eBay and
accessible at www.ebay.com, and (ii) any website(s) that eBay may spin off from
www.ebay.com by moving one of its current [***] top-level categories (excluding
[***]) (as of the Effective Date, the [***] are: [***]) with all of the
corresponding listings in such moved category, and where such spun-off site
cannot be accessed by eBay Users from www.ebay.com. "eBay Site" shall not
include any current or future [***] or [***] in which eBay currently
participates or may participate in the future.

     1.9    "eBay User" means any person who accesses any page on the eBay Site.

     1.10   "E-Stamp Content" means any promotional content or information in
any medium provided by or on behalf of E-Stamp to eBay for eBay's use in
promoting the E-Stamp Service on the eBay Site.

     1.11   "E-Stamp Marks" means all E-Stamp domain names, trademarks and logos
used by E-Stamp in the course of operating the E-Stamp Site and providing the E-
Stamp Services to its customers.

     1.12   "E-Stamp Additional Service" means any product or service, except
the E-Stamp Service (defined below), which E-Stamp develops and makes generally
available to its customers.

     1.13   "E-Stamp Service" means E-Stamp's service that enables users to
purchase online electronic USPS postage through the USPS Information-Based
Indicia Program ("IBIP").

     1.14   "E-Stamp Site" means the website owned and operated by E-Stamp and
accessible at www.e-stamp.com and www.estamp.com, or any successor thereto,
              ---------------     --------------
which contains the E-Stamp-branded (i.e., non-co-branded) version of the E-Stamp
Service.

     1.15   "E-Stamp Starter Kit" means the starter package that includes the E-
Stamp electronic vault and may also include a software CD, an address matching
CD, hardware and software manuals, complimentary envelopes and labels, and/or
other informational materials.

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       2.
<PAGE>

     1.16   "Launch Pad" means the Co-Branded Page(s) to which an eBay User is
initially transported upon clicking on any E-Stamp link on the eBay Site. 1.17
"Marks" means the E-Stamp Marks or eBay Marks, as applicable.

     1.18   "Quarter" means a calendar quarter; provided, however that the first
(1st) Quarter of this Agreement shall mean the time period from the Effective
Date through March 31, 2000 and the twelfth (12th) Quarter shall mean the time
period from October 1, 2002 through December 9, 2002.

     1.19   "Year" means a calendar year; provided, however, that the first
(1st) Year of this Agreement shall mean the time period from the Effective Date
through December 31, 2000, and the third (3rd) Year of this Agreement shall mean
the time period from January 1, 2002 to December 9, 2002.

2.   Development and Implementation.

     2.1    Co-Branded Pages. Within sixty (60) days of the Effective Date, E-
Stamp shall develop and launch the Launch Pad and other Co-Branded Pages,
subject to eBay prior review and approval, which approval shall not be
unreasonably withheld or delayed. E-Stamp shall be responsible for all
development, hosting and other costs associated with the Co-Branded Pages. E-
Stamp agrees that all information provided by or on behalf of E-Stamp, including
without limitation, information relating to the E-Stamp Service and the E-Stamp
Additional Services, will be: (i) complete and accurate, and (ii) accessible to
all eBay Users on the Launch Pad and elsewhere on the Co-Branded Pages. Further,
unless otherwise directed by eBay: (a) the Co-Branded Pages shall include all of
the eBay Content provided by eBay to E-Stamp, as well as all of the content
displayed on the E-Stamp Site as mutually agreed to by the parties, and (b) the
E-Stamp Content shall be updated to keep the Co-Branded Pages in parity with the
E-Stamp Site. eBay agrees that the eBay Content will be complete and accurate.
The parties expressly acknowledge and agree that no advertising will be placed
on the Co-Branded Pages, unless the parties otherwise mutually agree. The Co-
Branded Pages may not be changed, modified or deleted without eBay's prior
written approval (which shall not be unreasonably withheld or delayed), except
for minor error-correction and other similar updates.

     2.2    Co-Branded Service Products.

            (a)   Address Labels. The parties will use commercially reasonable
     efforts to develop and distribute address labels that include eBay Marks
     within [***] days of the Effective Date. E-Stamp agrees to make such labels
     available to Acquired Users and other eBay Users on an ongoing basis during
     the term of this Agreement.

            (b)   Postage. If and when the USPS approves the inclusion of third-
     party branding elements (i.e., in addition to E-Stamp and USPS branding
     elements) on electronic postage, the parties will use commercially
     reasonable efforts to develop and distribute electronic postage that
     includes eBay Marks within [***] days following such approval. E-Stamp
     agrees to make such electronic postage available to Acquired Users and
     other eBay Users on an ongoing basis during the term of this Agreement.

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       3.

<PAGE>

            (c)   Approval Required. The co-branding of both the labels and
     postage as described above will be subject to: (i) the approval of eBay, E-
     Stamp and the USPS, respectively, and (ii) applicable laws, regulations and
     USPS requirements. eBay acknowledges that the E-Stamp software and service,
     the E-Stamp Internet postage indicia and postal labels and supplies are
     regulated by the USPS, and approvals for the development or revision
     thereof are granted at the sole discretion of the USPS.

     2.3    Co-Branded Supplies Business. The parties will cooperate to launch a
co-branded supplies business within [***] days following the Effective Date.
Such business is expected to involve the development of Co-Branded Supplies and
other products to be distributed and sold: (a) in an eBay/E-Stamp co-branded
online supply store which will be hosted, operated, managed and maintained by
E-Stamp as a component of the Co-Branded Pages, (b) on other web sites, (c) via
mail order, and/or (d) in brick and mortar locations. E-Stamp shall not produce,
promote or distribute any Co-Branded Products or launch or modify the co-branded
online supply store without eBay's prior written approval, which approval shall
not be unreasonably withheld or delayed. eBay will provide links to such co-
branded supply store on the eBay Site. Further, E-Stamp will retain all revenue
generated through sales on the online store, subject to E-Stamp's payment of the
revenue share to eBay, as further provided in Section 8.1(c) ("Revenue Sharing
Fee").

     2.4    Changes. E-Stamp shall notify eBay if: (i) E-Stamp changes or adds
(excluding minor changes such as if E-Stamp adds the ability to support a new
printer or software application) any functionality to the E-Stamp Service, or
(ii) develops and makes available E-Stamp Additional Services to any of its
users. E-Stamp shall within thirty (30) days of the proposed offer date, offer
eBay the ability to include the E-Stamp Additional Services or additional
functionality on the Co-Branded Pages, and if eBay agrees to such modification
of services within ninety (90) days following E-Stamp's offer, E-Stamp shall
implement such changes or additions with respect to the Co-Branded Service
Products and make such changes available on the Co-Branded Pages within thirty
(30) days following eBay's agreement.

     2.5    Rebranding. If eBay modifies the eBay Marks and requests E-Stamp to
modify the Co-Branded Pages, Co-Branded Service Products or Co-Branded Supplies,
E-Stamp shall modify such items as soon as commercially practicable. Further,
the parties agree to discuss the development of additional branded versions of
the Co-Branded Pages, Co-Branded Service Products and Co-Branded Supplies which
would contain the branding elements of eBay's affiliates; provided that nothing
in this Section 2.5 ("Rebranding") shall obligate E-Stamp to negotiate, enter
into an agreement or otherwise establish a relationship with eBay regarding such
additional branded versions.

     2.6    Navigation. E-Stamp shall not use any interstitials, pop-up windows,
other intermediate steps or any other technology or content which acts as a
barrier to the transition of an eBay User from the eBay Site to the Launch Pad,
nor shall E-Stamp otherwise frame the Co-Branded Pages or use any other
technology which interferes with or affects the page layout of such pages. All
Co-Branded Pages shall contain a prominent link back to the eBay Site, which,
when clicked upon, returns the user to the page on the eBay Site that the user
last viewed prior to viewing a Co-Branded Page, or as otherwise specified by
eBay in writing. The Co-Branded Pages shall not include any links to any pages
other than the Co-Branded Pages and the eBay

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       4.

<PAGE>

Site, except for a link to the E-Stamp.com Account and USPS Licensing Setup page
(where such page will only link to other Co-Branded Pages, the eBay Site or to
E-Stamp's copyright information page).

     2.7    User Relations. E-Stamp shall be solely responsible for providing
all customer support regarding the E-Stamp Service and the Co-Branded Pages, and
eBay may redirect to E-Stamp any associated customer support inquiries. E-Stamp
shall provide eBay with a toll-free telephone number and email address that eBay
may provide to eBay Users when redirecting such customer support inquiries to E-
Stamp. E-Stamp shall also designate dedicated customer support and technical
support contacts for eBay and provide eBay with the names and contact
information of these individuals. E-Stamp shall have sole control over the user
agreement that governs the E-Stamp Service but shall consider eBay's input, and
E-Stamp shall have the sole responsibility for dealing with breaches of such
user agreement. If eBay has an issue with the user agreement or E-Stamp's
enforcement of it, the parties shall discuss such issues in good faith. Further,
subject to the provisions of Section 6 ("Customer Information") and applicable
laws, rules and regulations, E-Stamp's privacy policy shall make such
disclosures, and E-Stamp shall obtain such user consents, as necessary to make
the disclosures to eBay regarding Acquired Users and other eBay Users as
required by this Agreement. As further provided in Section 3 ("Most Favored
Customer"), all Acquired Users shall be treated at least as favorably in all
respects (including without limitation with respect to pricing, quality of
service, and customer support responsiveness) as E-Stamp treats any users of the
E-Stamp Service, the E-Stamp Additional Services and the E-Stamp Site. Further,
in order to promote focus on customer service and provide a high level of
customer satisfaction to the Acquired Users, E-Stamp's customer support and
service will meet the customer support standards described in Exhibit A
("Performance Standards") attached hereto.

     2.8    Minimum Site Performance. During the term of the Agreement, the E-
Stamp Site and all related technology necessary to operate the E-Stamp Site will
meet the performance standards described in Exhibit A ("Performance Standards")
attached hereto.

     2.9    International Opportunities. In the event E-Stamp decides to offer
its product or services in international markets, E-Stamp may notify eBay in
writing of such international plans once E-Stamp has commenced the applicable
formal approval process in the relevant international market. After eBay has
been notified of such plans, eBay agrees to discuss international online
electronic postage opportunities in such market with E-Stamp, subject to eBay's
then-existing contractual obligations. Notwithstanding the foregoing, nothing in
this Section 2.9 ("International Opportunities") shall obligate eBay to
negotiate, enter into an agreement or otherwise establish a relationship with E-
Stamp regarding such opportunities.

3.   Most Favored Customer.

     3.1    Preferential Pricing and Service. During the term of this Agreement,
the pricing and service performance of the E-Stamp Service provided to eBay
Users will be [***] than that offered to any other users of E-Stamp's services.
In order to maximize the penetration, customer satisfaction, and benefit of the
E-Stamp Service to eBay Users, E-Stamp will charge each Acquired User a maximum
monthly convenience fee (the "Monthly Convenience Fee") equal to the lesser of:
(i) $24.99 per month, and (ii) the

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       5.
<PAGE>

maximum monthly convenience fee that any user of the E-Stamp Service would be
charged under any other pricing plan offered by E-Stamp.

     3.2    Exceptions. E-Stamp's preferential pricing and service obligations
described above will not apply to:

            (a)   E-Stamp's product and service offerings in conjunction with:
(i) [***], a product of [***], (ii) special promotional offers to [***]
purchasers or subscribers (provided that such promotions shall be limited to
[one (1)] per calendar [***] and a maximum duration of [***] each), or (iii)
other similar promotions which require a user to buy a product or subscribe to a
service (in either case, where the manufacturer's suggested retail price (or in
the case of a service, the service provider's aggregate first year fees) exceeds
[***] dollars ($[***]) in order to receive the E-Stamp Starter Kit at no charge;
or

            (b)   E-Stamp's agreements with corporate customers (defined as any
business entity with more than [two hundred (200)] employees) in which a flat
convenience fee is charged; provided, however, that such agreements shall
pertain to such customers' employees use of the E-Stamp Service for corporate
purposes only.

     3.3    Effect of Breach. E-Stamp expressly acknowledges and agrees that,
(a) should E-Stamp breach any provision of this Section 3 ("Most Favored
Customer") on three (3) or more separate occasions during the term of this
Agreement (regardless of cure but subject to the notice provisions set forth
herein), or (b) should E-Stamp fail to cure any breach of this Section 3 ("Most
Favored Customer") within thirty (30) days following notice thereof by eBay,
eBay shall no longer be bound by its exclusivity obligations as described in
Section 7 ("Exclusivity"). With regard to item (a) above, an "occasion" shall
mean each time eBay has provided E-Stamp with written notice of E-Stamps' breach
of Section 3 ("Most Favored Customer") by offering preferential pricing or
service performance of the E-Stamp Service to non-eBay Users, including, for
example, the offering by means of a marketing campaign, promotion, arrangement
with a business partner, or promotion to any group of users. To clarify, each
instance of offering such preference to a group of users shall only count as one
occasion, and shall not be counted by the number of users.

     3.4    Product and Service Discounts. Without limiting E-Stamp's
obligations described in Section 3.1 ("Preferential Pricing and Service"), E-
Stamp agrees to: (i) [***] the E-Stamp Starter Kit (and any successors thereto)
[***] for eBay [***] and other eBay sellers as eBay and E-Stamp may mutually
agree, and (ii) to provide a [***] percent ([***]%) discount off of the E-Stamp
Start Kit (and any successors thereto) license fee and/or other comparable
promotional offer to all other eBay Users.

4.   Promotion and Integration.

     4.1    eBay Promotion. eBay will use commercially reasonable efforts to
integrate the E-Stamp Content into the eBay Site, including placing the E-Stamp
Content on the eBay home page at www.ebay.com, and in other areas of the eBay
                                 ------------
Site as the parties mutually agree. Subject to the terms and conditions of this
Agreement (including Section 4.3 ("Guidelines")), eBay will

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       6.

<PAGE>

promote the E-Stamp Service to eBay Users by means of a combination of certain
fixed placements, rotating placements, and direct marketing, as described below.
E-Stamp agrees that all E-Stamp links on the eBay Site shall link to the Launch
Pad.

            (a)   Fixed Placements. As soon as practicable after execution of
the Agreement, eBay will place E-Stamp Content in the following areas of the
eBay Site (the "Fixed Placements"):

   [***] page ([***])
              -------------------
   [***] page

         ([***])
         ------------------------------------------------------------
   [***] page ([***])
              -------------------------------------------------------
   [***] page ([***])
              ------------------------------------------------
   [***] page ([***])
              --------------------------------------------

            (b)   Rotating Placements. The parties further agree that after the
Agreement is executed, the E-Stamp Content may appear on one or more of the
following pages or services of the eBay Site, or on other mutually agreed upon
pages of the eBay Site (the "Rotating Placements"):

   [***] emails
   [***] emails
   [***] page
   [***] page
   [***] page
   [***] page
   [***]

            (c)   Other Promotions. In addition, eBay will, at least once per
Quarter, provide a dedicated E-Stamp promotion to eBay PowerSellers and other
eBay top sellers (but only to such PowerSellers and top sellers who have elected
to receive such promotional emails), as the parties mutually agree.

     4.2    E-Stamp Content Delivery. E-Stamp will deliver the E-Stamp Content
to eBay in a mutually agreeable format and on a mutually acceptable uploading
and refresh schedule. eBay may refuse delivery of any E-Stamp Content delivered
in an unsupported format, and may reject any E-Stamp Content that does not
conform to the requirements of eBay's then current policies relating to content,
as such policies are applied to third parties supplying content to eBay.

     4.3    Guidelines. eBay agrees to consult E-Stamp regarding the text and
placement of the E-Stamp Content on the eBay Site; provided, however, that eBay
will retain final approval over the E-Stamp Content and the placement of such E-
Stamp Content on the eBay Site. Without limiting the foregoing, if eBay deletes
or modifies any page containing a Fixed Placement, or elects to remove the E-
Stamp Content from one or more Fixed Placements, eBay will provide E-Stamp
comparable promotion in another area or areas of the eBay Site, or through the
use of targeted emails. This Agreement shall not restrict eBay's ability or
discretion to change or otherwise modify any of eBay's web sites or pages
thereof.

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       7.

<PAGE>

     4.4    Integration of Browser-Based Service. eBay will use commercially
reasonable efforts to integrate the E-Stamp browser-based service into the eBay
Site promptly following its commercial release (provided that eBay approves such
interface and service). Such service will be co-branded as permitted by the USPS
(unless eBay elects not to include eBay Branding Elements in such service) and
will reside on E-Stamp's servers.

     4.5    Acquisitions. Should eBay acquire an entity that maintains a web
site with then-current monthly traffic equaling at least [***] percent ([***]%)
of the eBay Site's then-current monthly traffic, then, as soon as commercially
practicable following the consummation of such acquisition, eBay agrees to
discuss opportunities for E-Stamp to promote and advertise its service on such
web site, subject to eBay's then-existing contractual obligations.
Notwithstanding the foregoing, nothing in this Section 4.5 ("Acquisitions")
shall obligate eBay to negotiate, enter into an agreement or otherwise establish
a relationship with E-Stamp regarding such opportunities.

5.   Licenses and Standards.

     5.1    Content Licenses. eBay hereby grants to E-Stamp a non-exclusive
license to use, reproduce, distribute, create derivative works of (only as
necessary to build, operate and maintain the Co-Branded Pages), publicly
perform, publicly display and digitally perform the eBay Content in or in
conjunction with the Co-Branded Pages. E-Stamp hereby grants to eBay a non-
exclusive, license to use, reproduce, distribute, create derivative works of
(only as necessary to promote the E-Stamp Service in a manner consistent with
this Agreement), publicly display, publicly perform and digitally perform the E-
Stamp Content on the eBay Site or otherwise as reasonably appropriate to
advertise and promote the E-Stamp Service and the Co-Branded Pages.

     5.2    Content Ownership. Except as otherwise provided in this Agreement,
as between eBay and E-Stamp: (i) eBay and its suppliers retain all rights, title
and interest in and to all intellectual property rights embodied in or
associated with the eBay Content, and (ii) E-Stamp and its suppliers retain all
rights, title and interest in and to all intellectual property rights embodied
in or associated with the E-Stamp Content. There are no implied licenses under
this Agreement, and any rights not expressly granted to a licensee hereunder are
reserved by the licensor or its suppliers. Neither party shall exceed the scope
of the licenses granted hereunder.

     5.3    Trademark Licenses. eBay hereby grants to E-Stamp a non-exclusive,
worldwide license to use the eBay Marks in links on and promotions of the Co-
Branded Pages and, subject to eBay prior approval, in the Co-Branded Service
Products and Co-Branded Supplies described hereunder. E-Stamp hereby grants to
eBay a non-exclusive, worldwide license to use the E-Stamp Marks in links on and
promotions of the Co-Branded Pages.

     5.4    Trademark Restrictions. The Mark owner may terminate the foregoing
trademark license if, in its reasonable discretion, the licensee's use of the
Marks tarnishes, blurs or dilutes the quality associated with the Marks or the
associated goodwill and such problem is not cured within ten (10) days of notice
of breach; alternatively, instead of terminating the license in total, the owner
may specify that certain licensee uses may not contain the Marks. Title to and
ownership of the owner's Marks shall remain with the owner. The licensee shall
use the Marks exactly in the form provided and in conformance with any trademark
usage policies. The

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                       8.
<PAGE>

licensee shall not take any action inconsistent with the owner's ownership
of the Marks, and any benefits accruing from use of such Marks shall
automatically vest in the owner. The licensee shall not form any combination
marks with the other party's Marks other than the domain name for the Co-Branded
Pages (the "Domain Name") (if applicable). If the Domain Name is deemed a
combination mark, neither party shall use the Domain Name for any purpose except
as expressly provided herein or attempt to register the Domain Name with any
government office, and the parties will jointly cooperate on any enforcement
action of infringement of the Domain Name.

     5.5    Limits on Sublicensing. All license rights (under any applicable
intellectual property right) granted herein are not sublicenseable, transferable
or assignable, except as otherwise provided herein.

     5.6    Content and Services Standards. eBay shall not provide any eBay
Content, and E-Stamp shall not provide any E-Stamp Content, that: (i) infringes
any third party's copyright, patent, trademark, trade secret or other
proprietary rights or rights of publicity or privacy; (ii) violates any law,
statute, ordinance or regulation (including without limitation the laws and
regulations governing export control, unfair competition, anti-discrimination or
false advertising); (iii) is defamatory, trade libelous, unlawfully threatening
or unlawfully harassing; (iv) is obscene, harmful to minors or child
pornographic; (v) contains any viruses, Trojan horses, worms, time bombs,
cancelbots or other computer programming routines that are intended to damage,
detrimentally interfere with, surreptitiously intercept or expropriate any
system, data or personal information; or (vi) is materially false, misleading or
inaccurate.

6.   Customer Information.

     6.1    Collection Limitations. Any information that E-Stamp obtains from
the Acquired Users ("Customer Information") will be limited to information
reasonably related to the purchase of U.S. online electronic postage through the
USPS IBIP under this Agreement or otherwise required to use the E-Stamp Service
or E-Stamp Additional Services, including without limitation, information
required to be obtained by any laws, regulations or USPS requirements.

     6.2    Use Limitations. E-Stamp will neither use (nor permit any third
party to use) Customer Information for any purpose other than to provide or
market its services to the Acquired Users; provided that neither E-Stamp nor any
third party will use Customer Information to market any products or services
(excluding the E-Stamp Starter Kit and E-Stamp Service) to Acquired Users where
such product or service is then currently: (i) offered by eBay or a third party
with whom eBay has a contractual relationship that could include such product or
services, or (ii) a product or service promoted by eBay to its members, except
that E-Stamp may market the multi-carrier shipping services referred to in
Section 7.3(b) (Multi-Carrier Shipping - Third Party Services") so long as such
marketing does not include direct communications targeted to the Acquired Users.

     6.3    Use Subject to Privacy Policy. E-Stamp further agrees to use such
Customer Information only as authorized by the Acquired Customer and subject to
E-Stamp's reasonable privacy policy, such privacy policy to be adequately
displayed throughout the E-Stamp Site and the Co-Branded Pages. E-Stamp will
neither use Customer Information to target communications

                                       9.
<PAGE>

to the Acquired Users (or facilitate the same on behalf of third parties)
without the express written permission from eBay and opt-in agreement from the
Acquired Users, nor will E-Stamp solicit or facilitate such solicitation by any
third party of Acquired Users as a result of their status as eBay Users, and E-
Stamp will explicitly not refer to Acquired Users as "eBay Users" or "eBay
members" (or any such reference) in any such promotion, except with the prior
written consent of eBay.

     6.4    eBay Approval Required for Certain Disclosures. E-Stamp agrees not
to sell, rent, lease or otherwise disclose the Customer Information without
eBay's prior written consent (such consent to be in eBay's sole discretion),
unless such Customer Information is disclosed as part of a one-time rental of
such Customer Information where: (i) the Acquired Users constitute less than
twenty percent (20%) of the aggregate list, (ii) the identity of any individual
user is not associated with such user's status as an eBay User, and (iii) such
list is not made available to an eBay Service Competitor (as defined in Section
7.2 ("Restrictions on E-Stamp")). Notwithstanding the foregoing, E-Stamp will:
(i) be permitted to use and disclose Customer Information as required by any
laws, regulations or USPS requirements, (ii) provide eBay with information
reasonably requested and necessary to support the calculation of the payments
due to eBay in Section 8 ("Payment Terms"), and (iii) provide eBay reasonable
access to E-Stamp's database of customers (and related information) who have
signed up for the E-Stamp service through the eBay Site or eBay advertising.

     6.5    Effect of Multi-Carrier Shipping Relationships. In the event eBay
establishes a relationship for a multi-carrier shipping service with a third
party, eBay will contractually require such third party not to use customer
information acquired from eBay Users by such third party to directly target
communications regarding USPS IBIP electronic online postage.

7.   Exclusivity.

     7.1    Restrictions on eBay.

           (a)    No Promotion. During the term of the Agreement, eBay will not,
on the eBay Site (excluding the pages and content on the eBay Site controlled by
eBay Users), promote or directly link to any E-Stamp Competitor's (as defined
below) service that allows users to purchase USPS electronic postage online
through IBIP; provided, that: (i) E-Stamp is among the top [***] U.S. online
electronic postage providers of USPS postage, as determined by independent third
parties and in light of the product offerings, pricing structure, the number and
average yearly postage purchases of E-Stamp customers, customer service and
satisfaction, and site performance, (ii) E-Stamp has not breached Section 3
("Most Favored Customer") on three (3) or more occasions during the term of this
Agreement (regardless of cure, but subject to written notice), and (iii) E-Stamp
has not failed to cure any material breach of this Agreement within thirty (30)
days following notice thereof by eBay.

            (b)   Definitions. An "E-Stamp Competitor" shall mean the following
entities (excluding any subsidiaries of such entities): (i) Stamps.com [***],
(ii) Neopost, and (iii) Pitney Bowes. The list of E-Stamp Competitors may be
updated from time to time with companies or divisions of companies whose primary
function is to allow users to purchase USPS electronic postage online through
IBIP, where such

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      10.
<PAGE>

updating is subject to eBay's approval, which approval shall not be unreasonably
withheld or delayed. "Directly link" shall mean a link which takes a user
directly to the URL (page) of a service that allows users to purchase, enroll
in a service to purchase, or download products which enable the purchase of USPS
electronic postage online through IBIP (a "Competitive URL").

            (c)   Clarification. As clarification, if a division or subsidiary
of a company is deemed to be an E-Stamp Competitor, eBay may not directly link
to the Competitive URL of the division or subsidiary of such company; however,
eBay is in no way restricted from linking to any of such company's other pages
on such company's web site that provide other services, despite the fact that a
user may access the Competitive URL via other links on such company's web site.
As further clarification, the USPS and expedited freight and/or shipping
companies such as Federal Express and the United Parcel Service are not E-Stamp
Competitors.

     7.2    Restrictions on E-Stamp. During the term of the Agreement, E-Stamp
will promote eBay as its exclusive partner with respect to online listing and
trading and will not promote its products or services in conjunction with the
online listing and trading services of any other party ("eBay Service
Competitors"); provided that: (i) eBay is among the top [***] U.S. online
listing and trading providers, as determined by independent third parties based
upon product offerings, the number and average yearly transactions, customer
service, and customer satisfaction, and (ii) eBay has not failed to cure any
material breach of the Agreement within thirty (30) days following notice
thereof by E-Stamp. In order to promote focus on customer service and provide a
high level of customer satisfaction, E-Stamp also agrees [***] This Section 7.2
("Restrictions on E-Stamp") will not restrict E-Stamp's existing rights and
obligations with Microsoft, Yahoo! or Excite@Home. eBay acknowledges that E-
Stamp retains a third party to assist with E-Stamp's Internet banner
advertising. E-Stamp agrees to use commercially reasonable efforts to ensure
that such third party does not place banner ads on eBay Service Competitor web
sites and, in the event eBay notifies E-Stamp of banner ads running on an eBay
Service Competitor's web site in violation of this Section 7.2 ("Restrictions on
E-Stamp"), E-Stamp will use commercially reasonable efforts to cease such
advertising within thirty (30) days of such notification. Notwithstanding the
foregoing, E-Stamp will not advertise its service on the online listing and
trading web site of any eBay Service Competitor during the first [***] months of
the term of the Agreement. As of the Effective Date, the eBay Service
Competitors are listed on Exhibit B ("eBay Service Competitors") and such list
may be updated from time to time during the term of the Agreement, where such
updating is subject to E-Stamp's approval, such approval not to be unreasonably
withheld or delayed.

     7.3    Multi-Carrier Shipping.

            (a)   [***] E-Stamp acknowledges that eBay has an existing
contractual relationship with [***]. Subject to eBay's contractual obligations,
eBay will use commercially reasonable efforts to [***] through the [***]
that is made available to eBay Users.

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      11.

<PAGE>

            (b)   Third Party Services. eBay agrees that Section 7.2
("Restrictions on E-Stamp") will not prevent E-Stamp from advertising or
marketing the E-Stamp Service on an eBay Service Competitor's web site solely
through a multi-carrier shipping interface offered by a third party that
contains numerous shipping services; provided that E-Stamp does not offer more
favorable pricing on the E-Stamp Service to users acquired through such
interface than that offered to Acquired Users, as further provided in Section 3
("Most Favored Customer"). Further, E-Stamp agrees that Section 7.1
("Restrictions on eBay") will not prevent eBay from advertising or marketing a
multi-carrier shipping service where offering users the ability to purchase IBIP
online electronic postage is not the primary function of such service, provided
that eBay will not advertise or market a multi-carrier shipping service, if, at
the time eBay desires to advertise or market such service, the company offering
such service is controlled by an E-Stamp Competitor. Nothing in this Section
7.3(b) ("Multi-Carrier Shipping - Third Party Services") will prevent eBay from
advertising or marketing a multi-carrier shipping service that is not controlled
by an E-Stamp Competitor but which contains an E-Stamp Competitor's service
integrated in such interface. Further, eBay will not be in breach of the
Agreement if eBay continues performing under an existing relationship with a
multi-carrier shipping service that was not controlled by an E-Stamp Competitor
at the inception of such relationship with eBay.

            (c)   Future Discussions. In the event that E-Stamp partners with a
multi-carrier shipping service, E-Stamp may notify eBay in writing of such
arrangement and the existence of a functional product, and eBay agrees, after
such notification, to discuss multi-carrier shipping service opportunities with
E-Stamp and/or such service, subject to eBay's existing contractual obligations.
Notwithstanding the foregoing, nothing in this Section 7.3(c) ("Multi-Carrier
Shipping - Future Discussions") shall obligate eBay to negotiate, enter into an
agreement or otherwise establish a relationship with E-Stamp or such service
regarding such opportunities.

     7.4    Breach of Exclusivity. Each party agrees that should it breach any
provision of this Section 7 ("Exclusivity") on three (3) or more separate
occasions during the term of this Agreement (regardless of cure but subject to
the notice provisions set forth herein), the non-breaching party shall no longer
be bound by its exclusivity obligations as described in this Section 7
("Exclusivity"). If a party materially breaches Section 7 ("Exclusivity") and
does not cure such breach within a period of thirty (30) days following written
notice thereof from the non-breaching party, then the non-breaching party shall
have the right to terminate the Agreement by providing written notice of
termination to the breaching party. If the non-breaching party elects not to
terminate the Agreement pursuant to this Section 7.4 ("Breach of Exclusivity"),
the non-breaching party will no longer be subject to the applicable requirements
in this Section 7 ("Exclusivity") for the term of the Agreement. If E-Stamp
terminates the Agreement pursuant to this Section 7.4 ("Breach of Exclusivity"),
eBay shall refund to E-Stamp a pro rata portion of the fee paid to eBay during
the applicable Quarter pursuant to Section 8.1(a) ("Fees and Payments - Fixed
Fees"), the amount of such refund to be prorated through the date of
termination. If either party terminates the Agreement pursuant to this Section
7.4 ("Breach of Exclusivity"), E-Stamp's ongoing future payment obligations will
cease (except for payments due to eBay and not yet paid in full by E-Stamp).

8.   Payment Terms.

                                      12.
<PAGE>

     8.1    Fees and Payments. All payments pursuant to this Section 8 ("Payment
Terms") are non-refundable except as provided in Section 7.4 ("Breach of
Exclusivity"). E-Stamp agrees to pay to eBay the following fees in the amounts
and according to the timeframes specified:

            (a)   Fixed Fees. E-Stamp will pay eBay a fixed fee of Thirty
Million Dollars ($30,000,000), payable as follows:

                  (i)    Five Million Dollars ($5,000,000) upon the parties'
execution of this Agreement ($125,000 of which shall be in consideration for
eBay engineering development required to initially promote E-Stamp on the eBay
Site); and

                  (ii)   Five Million Dollars ($5,000,000) on each of the
sixth (6th) month, twelfth (12th) month, eighteenth (18th) month, twenty-
fourth (24th) month and thirtieth (30th) month anniversary of the Agreement's
execution. Except for the $5,000,000 payment due upon execution of the
Agreement pursuant to Section 8.1(a)(i), above, payments pursuant to this
Section 8.1(a) ("Fixed Fees") will be made within ten (10) days following eBay's
invoice therefor.

            (b)   Customer Bounty Fees. In addition to the fixed fees described
in Section 8.1(a) ("Fixed Fees"), E-Stamp will pay eBay a one-time fee of
[***] dollars ($[***]) per Acquired User acquired by E-Stamp during each Year
in excess of [***] ([***]) Acquired Users. E-Stamp will make such payments
within thirty (30) days following the end of each Quarter. For purposes of
clarification, E-Stamp will make such payment in any Quarter where the number of
Acquired Users acquired by E-Stamp during such Quarter, plus the number of
Acquired Users acquired by E-Stamp in the previous Quarter(s) of such Year (the
sum being the "Cumulative Acquired Users"), exceeds [***] Acquired Users. If the
number of Cumulative Acquired Users does not exceed [***] Acquired Users in the
applicable Year, no payment will be due to eBay pursuant to this Section 8.1(b)
("Customer Bounty Fees") for such Quarter. The parties agree that, with respect
any Year or Quarter that does not contain the same number of days as a calendar
year or quarter, respectively, then the Acquired User bounty threshold will be
prorated accordingly.

            (c)   Revenue Sharing Fee. In addition to the fixed fees described
in Section 8.1(a) ("Fixed Fees") and the bounty fees described in Section 8.1(b)
("Customer Bounty Fees"), E-Stamp will pay eBay Quarterly fees of [***] percent
([***]%) of all Net Revenues (defined as gross revenues, less refunds and sales
taxes) earned by E-Stamp during each Quarter from: (i) the sale of supplies to
Acquired Users, and (ii) the sale of any co-branded products and supplies
(regardless of purchaser) through the online store or elsewhere. E-Stamp will
make such payment within thirty (30) days after the end of each Quarter and for
two (2) consecutive calendar quarters immediately following the expiration or
early termination of this Agreement. In no event shall the foregoing apply to
revenue from the sale of the E-Stamp Starter Kit or convenience fees from the
sale of USPS online electronic postage.

     8.2    Overdue Payments. Overdue payments shall accrue interest, at the
lesser of one and one-half percent (1-1/2%) per month or the maximum allowable
interest under applicable law, from due date until paid, and the owing party
shall pay the owed party's costs of collection (including reasonable attorneys'
fees).

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      13.
<PAGE>

     8.3    Taxes. E-Stamp shall collect and pay and indemnify and hold eBay
harmless from, any sales, use, excise, import or export value added or similar
tax or duty associated with this Agreement not based on eBay's net income,
including any penalties and interest, as well as any costs associated with the
collection or withholding thereof, including reasonable attorneys' fees.

     8.4    Audit Rights. During the term of this Agreement and for two (2)
years thereafter, E-Stamp shall maintain proper records and books of account
relating to the computation of payments owed to eBay. No more frequently than
once every six (6) months, eBay's designated auditing professional may inspect
such records to verify E-Stamp's reports to eBay, as further described in
Section 9 ("Reports"). Any such inspection will be conducted in a manner that
does not interfere with E-Stamp's regular business activities of the party being
audited. The auditing professional shall enter into a confidentiality agreement
in the form specified by E-Stamp, and shall not disclose any of the records of
the party being audited to eBay. E-Stamp shall immediately make any overdue
payments disclosed by the audit plus applicable interest. Such inspection shall
be at the eBay's expense; however, if the audit reveals overdue payments in
excess of ten percent (10%) of the payments owed to date, E-Stamp shall
immediately pay the cost of such audit, plus any unpaid amounts due to eBay.

9.   Reports. E-Stamp shall provide to eBay the following reports: (i) on a bi-
weekly basis, usage reports, broken down by day, regarding the Co-Branded Pages
describing the number of click-throughs to the Launch Pad or other Co-Branded
Pages, number of Acquired Users, aggregate user traffic (and shall use its
commercially reasonable efforts to provide the data specified in Paragraphs 1, 2
and 3 in Exhibit A, broken down by the appropriate time increments),
registrations and such other information as eBay may request; (ii) monthly
demographic reports regarding the E-Stamp Service containing summary information
regarding user demographic profiles if and when E-Stamp should collect such
demographic information; and (iii) quarterly reports regarding the computation
of the fees owed to eBay under Section 8 ("Payment Terms"). E-Stamp will
maintain accurate records and will provide eBay with timely reports based upon
such records (including information with respect to aggregate user traffic and
registrations), in a mutually-agreeable format.

10.   Term and Termination.

      10.1  Term; Termination. The term of the Agreement shall be three (3)
years from the Effective Date. The Agreement will be terminable early: (i) if a
party materially breaches this Agreement and does not cure such breach within
thirty (30) days following written notice thereof from the non-breaching party;
(ii) by mutual agreement; (iii) by eBay after thirty (30) days written notice to
E-Stamp, if E-Stamp fails to meet the performance criteria described in Sections
2.7 ("User Relations") or 2.8 ("Minimum Site Performance") or Exhibit A
("Performance Standards") and does not cure such failure within thirty (30) days
following written notice thereof; (iv) by E-Stamp after thirty (30) days written
notice to eBay, if eBay fails to meet the performance criteria described in
Section 4.1 ("Promotion and Integration") and does not cure such failure within
thirty (30) days following written notice thereof; or (v) as provided in Section
7.4 ("Breach of Exclusivity").

                                      14.
<PAGE>

     10.2   Termination for Change of Control. By providing written notice, eBay
may elect to terminate this Agreement during a ninety (90) day period following
a Change of Control of E-Stamp, by providing notice during such window and which
termination shall be effective thirty (30) days following the notice. "Change of
Control" means any Ownership Change Event or a series of related Ownership
Change Events (collectively, the "Transaction") wherein E-Stamp's shareholders
immediately preceding the Transaction do not retain immediately after
theTransaction, in substantially the same proportions as their ownership of
shares of E-Stamp's voting stock or other voting interests immediately before
the Transaction, direct or indirect beneficial ownership of more than fifty
percent (50%) of the total combined voting power of the corporation or
corporations to which substantially all of E-Stamp's assets or stock were
transferred, as the case may be. An "Ownership Change Event" occurs if any of
the following occur: (a) the direct or indirect sale or exchange in a single
series of related transactions by E-Stamp's shareholders or other ownership
interest holders of more than fifty percent (50%) of its voting stock or other
voting interests; (b) a merger or consolidation in which E-Stamp is a party; (c)
the sale, exchange or transfer of all or substantially all of E-Stamp's assets;
or (d) a liquidation or dissolution of E-Stamp. However, an Ownership Change
Event does not occur as a result of any transaction or series of transactions
that are effected solely in connection with a (i) reincorporation, or (ii) a
reorganization, recapitalization or similar financing not in connection with the
sale of all or substantially all of E-Stamp's assets or stock or other ownership
interests. If eBay terminates the Agreement pursuant to this Section 10.2
("Termination for Change of Control"), eBay shall refund to E-Stamp a pro rata
portion of the fee paid to eBay during the applicable Quarter pursuant to
Section 8.1(a) ("Fees and Payments - Fixed Fees"), the amount of such refund to
be prorated through the date of termination.

     10.3   Effects of Termination. Upon the expiration or early termination of
this Agreement, and upon eBay's request, E-Stamp agrees to continue to operate
the Co-Branded Pages under the terms and conditions of this Agreement, for a
minimum of sixty (60) days from the date such termination is effective, and to
cooperate with eBay in order to facilitate communication regarding the
termination to Acquired Users. Upon expiration or termination, all licenses
granted hereunder shall terminate unless such licenses are expressly stated as
surviving. Notwithstanding anything to the contrary contained in this Agreement,
if eBay terminates this Agreement pursuant to Section 10.1(iii) above, E-Stamp's
ongoing future payment obligations will cease (except for payments due to eBay
and not yet paid in full by E-Stamp).

     10.4   Survival. Sections 1 ("Certain Definitions"); 5.2 ("Content
Ownership"); 5.4 ("Trademark Restrictions") (relating to intellectual property
ownership); 6 ("Customer Information"); 8 ("Payment Terms") (relating to E-
Stamp's obligation to pay any then-currently owed but unpaid amounts, and other
relevant terms, but excluding amounts otherwise payable under Section 8.1(a)
after termination); 10.3 ("Effects of Termination"); 10.4 ("Survival"); 11
("Representations and Warranties"); 12 ("Indemnity"); 13 ("Limitation of
Liability"); 14 ("Confidential Information") and 15 ("General") shall survive
the expiration or early termination of this Agreement.

11.  Representations and Warranties.

                                      15.
<PAGE>

     11.1   Performance Warranty. E-Stamp represents and warrants that the E-
Stamp Service and the E-Stamp Additional Services shall comply in all material
respects with its then-published documentation therefor.

     11.2   Compliance with Laws. At its own expense, E-Stamp shall comply with
all applicable laws, regulations, rules, ordinances and orders regarding the E-
Stamp Service, E-Stamp Additional Services, E-Stamp Content, E-Stamp Site and
Co-Branded Pages. Without limiting the foregoing, E-Stamp warrants that: (a) it
has all governmental approval, permits and licenses, and has made all
governmental filings and registrations, necessary or prudent for the marketing
and performance of the E-Stamp Service, and (b) eBay is not required to obtain
any governmental approval, permits or licenses as a result of this Agreement,
eBay's performance hereunder or any payments made by E-Stamp hereunder.

     11.3   Disclaimer of Other Warranties. EXCEPT AS EXPRESSLY STATED HEREIN,
EACH PARTY DISCLAIMS ALL WARRANTIES AND CONDITIONS, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING WITHOUT LIMITATION THE IMPLIED WARRANTIES OF TITLE, NON-
INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. EBAY DOES
NOT REPRESENT OR WARRANT THAT THE EBAY SITE WILL OPERATE SECURELY OR WITHOUT
INTERRUPTION. EXCEPT AS EXPRESSLY STATED HEREIN, E-STAMP DOES NOT REPRESENT OR
WARRANT THAT THE E-STAMP SITE, THE CO-BRANDED PAGES, THE E-STAMP SERVICE OR E-
STAMP ADDITIONAL SERVICES WILL OPERATE WITHOUT INTERRUPTION. Each party
acknowledges that it has not entered into this Agreement in reliance upon any
warranty or representation except those specifically set forth herein.

12.  Indemnity.

     12.1   Mutual Indemnity. eBay shall indemnify E-Stamp against any and all
claims, liabilities, losses, costs and expenses, including reasonable attorneys'
fees (collectively, "Claims") which E-Stamp may incur as a result of any claims
in any form by third parties arising from, relating to or in connection with the
eBay Marks or any eBay Content, except where such eBay Marks or eBay Content has
been modified, and such modification is the basis of the Claim. Such
indemnification shall be eBay's sole and exclusive obligation and E-Stamp's sole
and exclusive remedy relating to such Claims. In addition, E-Stamp shall
indemnify eBay against any and all Claims which eBay may incur as a result of
any claims in any form by third parties arising from, relating to or in
connection with any E-Stamp Content, the E-Stamp Marks, the E-Stamp Service, the
E-Stamp Additional Services, or from any breach by E-Stamp of Section 11.2
("Compliance with Laws").

     12.2   Further Indemnity.

            (a)   Without limiting the foregoing, E-Stamp shall indemnify eBay
against any and all Claims which eBay may incur as a result of any claims in any
form by third parties that the E-Stamp Service or any E-Stamp Additional Service
which E-Stamp provides eBay Users in connection with this Agreement infringes
any third party's copyright, patent, trademark, trade secret or other
proprietary rights or rights of publicity or privacy. Without limiting any other
provisions of this Agreement, E-Stamp agrees to reimburse eBay for reasonable
attorneys' fees

                                      16.
<PAGE>

and expenses incurred by eBay in connection with Claims under this Section 12.2
asserted by [ *** ] against eBay ("Further Indemnity") on an as-incurred basis,
promptly upon request for amounts therefor, and without regard to a
determination as to the validity of any third party claim implicated under this
Section 12.2 ("Further Indemnity").

            (b)   In the event that the provision, marketing, promotion, or use
of the E-Stamp Service or E-Stamp Additional Services to be provided under this
Agreement are enjoined or otherwise limited, restricted, or conditioned, eBay
may suspend its performance obligations (but not its exclusivity obligations
under Section 7 ("Exclusivity")) from such date (the "Suspension Date"), and
E-Stamp shall use all commercially reasonable efforts to (i) procure the rights
required to permit the provision, marketing, promotion and use of the E-Stamp
Service or E-Stamp Additional Services as contemplated under this Agreement, or
(ii) provide alternative noninfringing materials or services (as applicable) of
comparable or superior functionality.

                  (i)    If, within sixty (60) days of the Suspension Date,
E-Stamp has (a) not succeeded in procuring the rights described in subsection
12.2(b)(i) above, and (b) eBay has determined in its reasonable discretion that
the alternative materials or services (as applicable) described in subsection
12.2(b)(ii) have either not been provided or, if provided, are not of comparable
or superior functionality, then either party may elect to terminate this
Agreement on thirty (30) days' written notice. During the thirty (30) period
following such notice, eBay will have no exclusivity obligations under Section 7
("Exclusivity").

                  (ii)   During the periods described in subsection 12.2(b),
E-Stamp's payment obligations under Section 8 ("Payment Terms") shall persist.

     12.3   Mechanics. The foregoing obligations are conditioned on the
indemnified party: (i) giving the indemnifying party notice of the relevant
claim, (ii) cooperating with the indemnifying party, at the indemnifying party's
expense, in the defense of such claim, and (iii) giving the indemnifying party
the right to control the investigation, defense and settlement of any such
claim, except that the indemnifying party shall not enter into any settlement
that affects the indemnified party's rights or interest without the indemnified
party's prior written approval. The indemnified party shall have the right to
participate in the defense at its expense, except that with regard to E-Stamp's
indemnity under Section 12.2 ("Further Indemnity"), such participation shall be
at the expense of E-Stamp (excluding any unreasonable attorneys' fees).

13.  Limitation of Liability. EXCEPT IN THE EVENT OF A BREACH OF SECTIONS 6
("CUSTOMER INFORMATION"), 14 ("CONFIDENTIAL INFORMATION") OR 11.3 ("COMPLIANCE
WITH LAWS"), NEITHER PARTY SHALL BE LIABLE FOR SPECIAL, INCIDENTAL OR
CONSEQUENTIAL DAMAGES OR LOST PROFITS (HOWEVER ARISING, INCLUDING NEGLIGENCE)
ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT. EXCEPT IN THE EVENT OF A
BREACH OF SECTIONS 14 ("CONFIDENTIAL INFORMATION") OR 11.3 ("COMPLIANCE WITH
LAWS"), A FAILURE TO PAY UNDER SECTION 8 ("PAYMENT TERMS"), OR A CLAIM UNDER
SECTION 12 ("INDEMNITY"), IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER
PARTY IN AN AMOUNT GREATER THAN [ *** ] DOLLARS ($[ *** ]); EXCEPT THAT
WITH RESPECT TO A BREACH OF SECTION 4.1 ("EBAY PROMOTION") OR SECTION 7
("EXCLUSIVITY"), THE MAXIMUM LIABILITY SHALL

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      17.
<PAGE>

BE [***] DOLLARS ([***]). THIS LIMITATION OF EACH PARTY'S LIABILITY IS
CUMULATIVE, WITH ALL PAYMENTS FOR CLAIMS OR DAMAGES IN CONNECTION WITH THIS
AGREEMENT BEING AGGREGATED TO DETERMINE SATISFACTION OF THE LIMIT. THE EXISTENCE
OF ONE OR MORE CLAIMS WILL NOT ENLARGE THE LIMIT.

14.  Confidential Information.

     14.1   Confidential Information Defined. A party's "Confidential
Information" is defined as any confidential or proprietary information of a
party which is disclosed to the other party in a writing marked confidential or,
if disclosed orally, is identified as confidential at the time of disclosure and
is subsequently reduced to a writing marked confidential and delivered to the
other party within ten (10) days of disclosure. The terms of this Agreement
shall be deemed Confidential Information.

     14.2   Mutual Obligations. Each party will hold the other party's
Confidential Information in confidence and will not disclose such Confidential
Information to third parties nor use the other party's Confidential Information
for any purpose other than as required to perform under this Agreement. Such
restrictions will not apply to Confidential Information which (a) is already
known by the recipient, (b) becomes publicly known through no act or fault of
the recipient, (c) is received by recipient from a third party without a
restriction on disclosure or use, or (d) is independently developed by recipient
without reference to the Confidential Information. The restriction on disclosure
will not apply to Confidential Information which is required to be disclosed by
a court, government agency, regulatory requirement, or similar disclosure
requirement, provided that recipient shall first notify the disclosing party of
such disclosure requirement or order and use reasonable efforts to obtain
confidential treatment or a protective order. The parties' respective
obligations hereunder shall survive the expiration or early termination of this
Agreement for a period of five (5) years.

     14.3   Return of Confidential Information Upon Termination. Upon
termination of this Agreement, the receiving party will return to the disclosing
party all Confidential Information of the disclosing party and all documents or
media containing any such Confidential Information and any and all copies or
extracts thereof.

     14.4   Confidential Treatment. Without limiting the foregoing, and subject
to compliance with applicable law, each party agrees to notify the other in the
event any element of this Agreement may need to be disclosed pursuant to any
regulatory or other disclosure requirement, and to further seek confidential
treatment requested by the other with respect to certain confidential elements
of the Agreement and any documents related thereto (including information
relating to fees, payments and integration) in any governmental or public
filings.

15.  General.

     15.1   Governing Law; Venue. This Agreement shall be construed in
accordance with and governed exclusively by the laws of the State of California
applicable to agreements made among California residents and to be performed
wholly within such jurisdiction, regardless of such parties' actual domiciles.
Both parties submit to personal jurisdiction in California and

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      18.
<PAGE>

further agree that any cause of action arising under this Agreement shall be
brought exclusively in a court in Santa Clara County, CA.

     15.2   Publicity. Without limiting the provisions of Section 14
("Confidential Information"), neither party will make any public statement
regarding the terms of this Agreement or any aspect thereof without the prior
written approval of the other party, provided that to the extent such disclosure
is required by law, rule, regulation, or governmental or court order, the party
requesting disclosure shall furnish the counter-party with sufficient time to
address such request with any such governmental agency and seek confidential
treatment.

     15.3   Independent Contractors. This Agreement does not create, and nothing
contained in this Agreement shall be deemed to establish a joint venture between
the parties, or the relationship of employer-employee, partners, principal-agent
or the like. Further, neither party shall have the power to bind the other
without the other's prior written consent, nor make any representation that it
has any such power.

     15.4   Assignment. Subject to Section 10.2 ("Termination for Change of
Control"), neither party may assign its rights nor delegate its duties hereunder
without the other party's prior written consent, (other than (a) to a parent
company or any wholly-owned subsidiary of such parent company, where the
assignee agrees to be bound by all obligations and the assignor guarantees the
performance of all obligations or (b) in connection with a merger or sale of all
or substantially all of a party's assets or securities) and any purported
attempt to do so will be null and void.

     15.5   Severability; Headings. If any provision herein is held to be
invalid or unenforceable for any reason, the remaining provisions will continue
in full force without being impaired or invalidated in any way. The parties
agree to replace any invalid provision with a valid provision that most closely
approximates the intent and economic effect of the invalid provision. Headings
are for reference purposes only and in no way define, limit, construe or
describe the scope or extent of such section.

     15.6   Force Majeure. If performance hereunder (other than payment) is
interfered with by any condition beyond a party's reasonable control, the
affected party shall be excused from such performance to the extent of such
condition.

     15.7   Notice. Any notice under this Agreement will be in writing and
delivered by personal delivery, overnight courier, confirmed facsimile,
confirmed email, or certified or registered mail, return receipt requested, and
will be deemed given upon personal delivery, one (1) day after deposit with an
overnight courier, five (5) days after deposit in the mail, or upon confirmation
of receipt of facsimile or email. Notices will be sent to a party at its address
set forth above or such other address as that party may specify in writing
pursuant to this Section 15.7 ("Notice").

     15.8   Dispute Resolution. Any dispute regarding this Agreement shall be
resolved as specified in this Section 15.8 ("Dispute Resolution"). Upon the
written request of either party, each party will appoint a designated
representative to attempt to resolve such dispute. Such representatives shall
negotiate in good faith to try to resolve the dispute. If the representatives do

                                      19.
<PAGE>

not resolve the dispute within ten (10) days after the date a party requested
the appointment of representatives, then the parties shall try in good faith to
resolve the dispute by mediation under the commercial Mediation Rules of the
American Arbitration Association. If the dispute is not resolved by such
mediation within thirty (30) days after the date a party requested the
appointment of representatives, then a party may initiate court proceedings. The
parties' representatives may mutually agree to adjust the time periods provided
in this Section 15.8 ("Dispute Resolution"). Notwithstanding the foregoing,
either party may initiate court proceedings for injunctive or other equitable
relief at any time if such party reasonably believes that the procedure set
forth in this Section 15.8 ("Dispute Resolution") could result in irreparable
injury due to delay.

                                      20.
<PAGE>

     15.9   Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.

     15.10  Entire Agreement; Waiver. This Agreement sets forth the entire
understanding and agreement of the parties, and supersedes any and all oral or
written agreements or understandings between the parties, as to the subject
matter of the Agreement. Without limiting the generality of the foregoing, the
Letter of Intent dated December 9, 1999 is hereby terminated as of the Effective
Date of this Agreement. This Agreement may be changed only by a writing signed
by both parties. The waiver of a breach of any provision of this Agreement will
not operate or be interpreted as a waiver of any other or subsequent breach.

     In Witness Whereof, the parties have executed this Co-Branding and
Promotion Agreement.

eBay Inc. ("eBay")                   E-Stamp Corporation ("E-Stamp"):

By: /s/ Jeffrey Jordan               By: /s/ Nicole Eagan
   -------------------------------      -----------------------------------
Name:   Jeffrey Jordan               Name:   Nicole Eagan
Title:  Vice President, eBay Inc.    Title:  Sr. Vice President, Marketing &
                                             Sales

                                      21.
<PAGE>

                                   Exhibit A
                             Performance Standards

1.  Service Availability. The E-Stamp Service shall be available to Acquired
    Users a minimum of [ *** ] percent ([ *** ]%) of the time during any
    [ *** ] period, [ *** ] percent ([ *** ]%) of the time during any [ *** ]
    period, and [ *** ] percent ([ *** ]%) of the time during any [ *** ]
    period; and there will be no period of interruption in such public
    accessibility that exceeds [ *** ].

2.  Response Time. The mean response time for server response to access the
    E-Stamp Service shall not exceed more than [ *** ] during any [ *** ]
    period.

3.  Bandwidth. The bandwidth representing the E-Stamp Service servers'
    connection to the Internet shall be operating at peak capacity no more than
    [ *** ] in any [ *** ] period and at greater than [ *** ] percent ([ *** ]%)
    of peak capacity no more than [ *** ] of any [ *** ] period.

4.  Security. E-Stamp shall prevent unauthorized access to restricted areas of
    its servers and any databases or other sensitive material generated from or
    used in conjunction with the Service. In addition, E-Stamp shall immediately
    notify eBay of any known security breaches or holes in the E-Stamp Service
    or Co-Branded Pages.

5.  E-Stamp Hardware, Software and Browser Performance. During the term of the
    Agreement, all hardware necessary for Acquired Users to use any part of the
    E-Stamp service will be free from material defects and operate in
    substantial conformity with its then-published specifications. In addition,
    if E-Stamp offers its service through an HTML interface (or other browser-
    based interface) and/or a client software interface, such interfaces will
    meet mutually agreed-upon written requirements as developed by the parties.

6.  Error Correction. E-Stamp shall resolve any errors with the Co-Branded Pages
    (including without limitation any Javascripts or ActiveX controls used in
    connection with such pages) that cause such services not to be able to
    perform one or more major functions within [ *** ] hours of the
    earlier of its discovery of the error or eBay's notice of the error. E-Stamp
    shall resolve all other errors with such services within [ *** ] days of
    the earlier of its discovery of the error or eBay's notice of the error.

7.  Browser Compatibility. The Co-Branded Pages shall initially be compatible
    with Netscape Navigator 3.X and later and Microsoft Internet Explorer 3.X
    and later. eBay may unilaterally add additional browsers or versions that
    the Co-Branded Pages must be compatible with, effective after thirty (30)
    days advance written notice, if eBay certifies that it believes such
    additional browsers or versions are used by more than [ *** ] percent
    ([ *** ]%) of eBay Users. eBay Users shall not require any plug-ins in order
    to access any Co-Branded Page functionality. This specifically excludes
    plug-ins which may be required for printing or other functionality in
    E-Stamp's browser-based service.

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      22.
<PAGE>

8.  Data Authentication. E-Stamp shall use commercially reasonable efforts, no
    less than industry-standard, to authenticate the origin of all information
    provided by eBay as having come from eBay.

9.  Customer Support. E-Stamp shall auto-respond to all customer and technical
    support inquiries from Users within [ *** ] of the receipt of inquiry. E-
    Stamp shall manually respond to all such inquiries within [ *** ]. E-Stamp
    shall resolve all such inquiries within [ *** ] or shall notify eBay that it
    cannot do so, in which case eBay at its sole discretion may intervene to
    assist in resolving the inquiry .

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      23.
<PAGE>

                                   Exhibit B
                           eBay Service Competitors

          [***]

*** Confidential treatment has been requested for the bracketed portions. The
    confidential redacted portion has been omitted and filed separately with the
    Securities and Exchange Commission.

                                      24.

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