Document:

<PAGE>

                             [Letterhead Addresses]

                                     [logo]

                                     DITECH

January 31, 2000

Ian Wright

Subject: Employment Offer

Dear Ian

I am pleased to offer you employment as Senior Vice President - Development
Engineering. reporting directly to me. This after is contingent upon the
approval of Ditech's Board of Directors or Compensation Committee.

Your compensation package consists of the following:

-    Annual Base salary of $180,000.

-    Management By Objectives Bonus of $60,000. This is guaranteed for the first
     year of employment, (total annual compensation is $240,000, with the bonus
     to be pro-rata over the year and paid on the fiscal quarters).

-    Subject to the approval of the Company's Board of Directors or its
     Compensation Committee, you will be granted stock options to purchase
     350,000 (post-split) shares of the Company's Common Steel The exercise
     price per share will be equal to the fair market value per share on the
     date the option is granted The option will be subject to the terms and
     conditions applicable to options granted under the defined Plan, as
     described in that Plan and the applicable stock option agreement. The
     option will be immediately exercisable and are Non-qualified options. The
     purchased shares will be subject to repurchase by the Company at the
     exercise price in the event that your service terminates before you vest in
     the shares. On 300,000 shares, you will vest in 25% of the option shares
     after 12 months of continuous service and the balance will vest in monthly
     installments over the next 36 months. On the remaining 50,000 share you
     will vest 100% in 6 years with an acceleration clause on Ditech achieving
     $50M in revenues from optical products on a trailing four quarter basis.

-    If the company terminates your employment for any reason other than cause
     during your first year of service, then the Company will continue to pay
     your base salary until the anniversary of your first day of employment or
     six months whichever is greater The same period will be credited as
     continuous service for purposes of the stock options described above with a
     maximum one year of vesting from date of hire. However, this paragraph will
     not apply unless you (a) have executed a general release (in a form
     prescribed by the Company) of all known and unknown claims that yon may
     then have against the Company or persons affiliated with the Company and
     (b) have agreed not to prosecute any legal action for other proceedings
     based on those claims. This paragraph is subject to Board approval.

-    Subject to approval of the Company's Board of Directors or its Compensation
     Committee, if the Company is acquired within your first 24 months of your
     employment and you are relieved of your position or a comparable one in the
     Acquiring company within the 24 month period (from commencement of
     employment at Ditech), you will leave with no less than 24 months of
     vesting in your original option grant noted above.

Executive compensation is reviewed at the beginning of our fiscal year on May
1st.

<PAGE>

Your benefit package with Ditech Communications Corporation will include Health
insurance coverage (with partial premium due if for family coverage) beginning
the first of the month after date of employment, Life and Long Term Disability
insurance with option for additional coverage, Flexible Spending Program
participation, Employee Stock Purchase Program (ESPP) and 401(k) participation.
Eligibility for 401(k) and ESPP participation is effective after 90 days of
employment

Your employment with Ditech Communications Corporation is at-will. You will be
asked to sign the statement of your acceptance and a confidentiality agreement
when you report to work.

I look forward to working with you and having you as a part of our valuable and
dynamic team! Please indicate your acceptance by signing and returning this
letter by February 2, 2000. You may fax your acceptance to (650) 564--9593. We
anticipate your start to be on March 1, 2000.

Sincerely,                        Accepted by:

 /s/Timothy K. Montgomery         /s/Ian Wright              2/2/00
-------------------------------   ------------------------   ---------
Timothy K. Montgomery             Ian Wright                 Date
President and CEO<PAGE>

                       SECOND AMENDMENT TO LEASE AGREEMENT

         This SECOND AMENDMENT TO LEASE AGREEMENT (the "SECOND AMENDMENT")is
made as of February 15, 2000 between MIDDLEFIELD - BERNARDO ASSOCIATES LLC, a
Delaware limited liability company ("LANDLORD"), and DITECH CORPORATION, a
California corporation ("TENANT").

                                    RECITALS:

         A. Tenant is the tenant under that certain Lease Agreement dated August
25, 1998 (the "ORIGINAL LEASE") between Lincoln-Whitehall Pacific, LLC ("PRIOR
LANDLORD"), as landlord, and Tenant. The Original Lease has been amended by that
certain First Amendment to Lease Agreement dated January 25, 1999 (the "FIRST
AMENDMENT") between Prior Landlord and Tenant. The Original Lease, as amended by
the First Amendment, is the "PRIOR LEASE"; the Prior Lease, as amended by this
Second Amendment, is the "Lease". The Prior Lease concerns those certain
premises (the "ORIGINAL PREMISES") which consist of approximately 35,800
rentable square feet of space in the building (known as "Building A", or "Unit
A") located at 825 East Middlefield Road, Mountain View, California, as such
premises are more specifically described in the Original Lease. All
initially-capitalized terms in this Second Amendment which are not defined in
this Second Amendment shall have the meanings given them in the Prior Lease.

         B. Landlord has acquired all of Prior Landlord's interest in the Park
and the Prior Lease.

         C. Addendum 1 to the Original Lease grants Tenant a right to extend the
term of the Lease, and Addendum 2 to the Original Lease grants Tenant certain
rights to expand into additional premises identified in the Original Lease as
Expansion Space #1 and Expansion Space #2.

         D. Expansion Space #1 consists of approximately 14,273 rentable square
feet of space (notwithstanding that Addendum 2 to the Original Lease erroneously
states that this space contains 14,815 rentable square feet) in the building in
the Park which has an address of 815 East Middlefield Road, and which is known
as "Building B", or "Unit B". Expansion Space #1 is depicted on Exhibit A to
Addendum 2 to the Original Lease. Expansion Space #1 is currently occupied by
Semiconductor Equipment and Materials International, Inc. ("SEMI"). SEMI's lease
covering Expansion Space #1 is currently scheduled to expire on June 30, 2000,
but SEMI has indicated to Landlord that SEMI may be interested in vacating
Expansion Space #1 prior to that date. Another tenant of the Park, Cisco
Systems, Inc. ("Cisco") has a right of first offer to Expansion Space #1 which
is prior to Tenant's rights to Expansion Space #1.

         E. Expansion Space #2 consists of approximately 11,245 rentable square
feet of space in Building B. Expansion Space #2 is depicted on Exhibit A to
Addendum 2 to the Original Lease. Expansion Space #2 is currently occupied by
Brandt Electronics, Inc. ("BRANDT"). Brandt's lease covering Expansion Space #2
is currently scheduled to expire on October 31, 2000. PRI Automation ("PRI") has
a right of first offer to Expansion Space #2 which is prior to Tenant's rights
to Expansion Space #2. Together, Expansion Space #1 and Expansion Space #2
comprise all of

<PAGE>

Building B. Expansion Space #1 and Expansion Space #2 are, collectively, the
"EXPANSION SPACE".

         F. Landlord and Tenant desire to amend the Prior Lease to extend the
Term and to add the Expansion Space to the Premises in accordance with the terms
of this Second Amendment.

         NOW, THEREFORE, Landlord and Tenant agree as follows:

         1. INTERPRETATION. The Prior Lease remains in full force and effect as
amended by this Second Amendment. Wherever the terms of this Second Amendment
and the Prior Lease conflict, this Second Amendment shall control.

         2.       EXPANSION OF PREMISES.

                  a. EXPANSION SPACE #1. Landlord may tender possession of
         Expansion Space #1 to Tenant at any time after SEMI has vacated and
         surrendered Expansion Space #1 to Landlord and prior to July 1, 2000.
         If Landlord has not then already tendered possession of Expansion Space
         #1 to Tenant, Landlord shall tender possession of Expansion Space #1 to
         Tenant on July 1, 2000, provided that if SEMI has not vacated and
         surrendered possession of Expansion Space #1 to Landlord on or before
         June 30, 2000, Landlord shall thereafter make commercially reasonable
         efforts to cause SEMI to vacate and surrender Expansion Space #1
         Premises as soon as possible, and Landlord shall not be obligated to
         tender possession of Expansion Space #1 to Tenant until SEMI has
         vacated and surrendered possession of Expansion Space #1 to Landlord.
         Tenant shall accept possession of Expansion Space #1 from Landlord on
         the date Landlord tenders possession of it in accordance with this
         Second Amendment. Landlord shall tender possession of Expansion Space
         #1 in broom-clean condition and with all building operating systems,
         including heating, ventilating and air conditioning systems ("HVAC"),
         in good working condition. The date Landlord tenders possession of
         Expansion Space #1 to Tenant in accordance with this Second Amendment
         is the "EXPANSION SPACE #1 COMMENCEMENT DATE". Effective on and after
         the Expansion Space #1 Commencement Date, Expansion Space #1 shall
         constitute part of the Premises, and each reference in the Prior Lease
         to the "Premises" shall include Expansion Space #1. Tenant shall
         commence paying Rent with respect to Expansion Space #1 on the day
         which is 31 days after the Expansion Space #1 Commencement Date as
         provided below in Section 5 of this Second Amendment. Promptly after
         the Expansion Space #1 Commencement Date occurs, Landlord and Tenant
         shall execute and deliver an amendment to the Lease stating the actual
         Expansion Space #1 Commencement Date. Expansion Space #1 shall be
         conclusively deemed to contain 14,273 rentable square feet of space for
         all purposes related to the Lease.

                  b. EXPANSION SPACE #2. After Brandt vacates and surrenders
         possession of Expansion Space #2 to Landlord, Landlord shall demolish
         the existing tenant improvements, so as to leave Expansion Space #2 in
         a gutted shell condition. Landlord shall tender possession of Expansion
         Space #2 to Tenant after completing such demolition, but no earlier
         than November 1, 2000, provided that if Brandt fails to vacate and
         surrender possession of Expansion Space #2 to Landlord on or before
         October 31, 2000, Landlord shall thereafter

                                      -2-

<PAGE>

         make commercially reasonable efforts to cause Brandt to vacate and
         surrender Expansion Space #2 Premises as soon as possible, and Landlord
         shall not be obligated to tender possession of Expansion Space #2 to
         Tenant until Brandt has vacated and surrendered possession of Expansion
         Space #2 to Landlord and Landlord has had a reasonable period of time
         in which to complete the required demolition. Tenant shall accept
         possession of Expansion Space #2 from Landlord on the date Landlord
         tenders possession of it in accordance with this Second Amendment.
         Landlord shall tender possession of Expansion Space #2 to Tenant with
         the demolition work described in this Section 2.b. completed. Landlord
         shall be responsible for putting the building operating systems,
         including HVAC, in or serving Expansion Space #2 in good working
         condition on the date Tenant occupies Expansion Space #2 for its
         intended use. The date Landlord tenders possession of Expansion Space
         #2 to Tenant in accordance with this Second Amendment is the "EXPANSION
         SPACE #2 COMMENCEMENT DATE". Effective on and after the Expansion Space
         #2 Commencement Date, Expansion Space #2 shall constitute part of the
         Premises, and each reference in the Prior Lease to the "Premises" shall
         include Expansion Space #2. Tenant shall commence paying Rent with
         respect to Expansion Space #2 on the Expansion Space #2 Commencement
         Date as provided below in Section 5 of this Second Amendment. Promptly
         after the Expansion Space #2 Commencement Date occurs, Landlord and
         Tenant shall execute and deliver an amendment to the Lease stating the
         actual Expansion Space #2 Commencement Date. Expansion Space #2 shall
         be conclusively deemed to contain 11,245 rentable square feet of space
         for all purposes related to the Lease.

                  c. EXTERIOR ADA COMPLIANCE. Landlord shall, at Landlord's sole
         cost, perform all work on the exterior walkways, exterior stairs, and
         other improvements serving Building B (but not including any tenant
         improvements in the Expansion Space or any other part of Building B)
         which are, in Landlord's reasonable opinion, reasonably required to
         bring such exterior improvements serving Building B into compliance
         with any provisions of the Americans With Disabilities Act which are
         applicable and in effect as of the Expansion Space #2 Commencement
         Date.

                  d. AS-IS CONDITION; NO REPRESENTATIONS; NO INDUCEMENTS. Tenant
         shall accept possession of Expansion Space #1 and Expansion Space #2
         on, the respective dates that Landlord tenders possession of them, in
         their "as-is", "whereas" condition with all faults on the date of
         tender, provided that nothing in this Section 2.d shall relieve
         Landlord of its obligation to perform all demolition and other work
         expressly required by Sections 2.a., 2.b., and 2.c. Other than the
         demolition and other work Sections 2.a., 2.b., and 2.c. require
         Landlord to perform, Landlord shall have no obligation to perform any
         demolition, construct any tenant improvements, or perform any other
         work whatsoever, in any part of the Expansion Space or the remainder of
         the Park. Tenant hereby acknowledges that neither Landlord nor any of
         its agents has made any representations or warranties whatsoever as to
         the suitability, safety, or fitness of the Expansion Space for the
         conduct of Tenant's business, Tenant's intended use of the Expansion
         Space, or for any other purpose whatsoever. Tenant hereby also
         acknowledges that, except for the "TI Allowance", as that term is
         defined below in this Second Amendment, Landlord has not agreed to
         provide to Tenant any other form of

                                      -3-

<PAGE>

         inducement whatsoever in connection with the extension of the Term or
         the inclusion of the Expansion Space within the Premises.

         3.       TENANT WORK.

                  a. TENANT WORK. Tenant shall perform such tenant improvement
         work (the "TENANT WORK") in each of Expansion Space #1 and Expansion
         Space #2 as Tenant elects for the purpose of using the Expansion Space
         for the Permitted Uses. Tenant shall be entitled to commence the Tenant
         Work on the first Expansion Space to be delivered in accordance with
         the terms of this Section 3 without waiting for the commencement date
         of the second Expansion Space.

                  b. PLANS. Prior to commencing any Tenant Work, Tenant shall,
         at its sole risk and cost, deliver to Landlord separate sets of
         architectural plans and specifications (the "PLANS") for the proposed
         Tenant Work in each of Expansion Space #1 and Expansion Space #2. The
         Plans shall be subject to Landlord's approval and shall be approved by
         all local governmental authorities with jurisdiction. Landlord's
         approval of any Plans may be conditioned upon Landlord's written
         requirement delivered concurrently with the approval of such Plans that
         Tenant remove or alter to satisfy the requirements of this Section 3.b.
         upon the termination of the Lease, all or any portion of the Tenant
         Work shown on such Plans which Landlord would be required after the
         termination of the Lease to alter or remove in order to render the
         relevant portion of the Expansion Space fully functional and
         operational and ready for occupancy by a typical prospective tenant of
         such portion of the Expansion Space. Landlord may so designate for
         removal at the termination of the Lease features such as a "clean
         room," offices of an atypical size, or an excess of a particular size
         or style of office or other room. Landlord will not unreasonably
         withhold its approval of any Plans, provided, that Landlord shall be
         deemed to have reasonably withheld its approval of such Plans if the
         proposed Tenant Work shown on such proposed Plans, in Landlord's
         reasonable opinion, either: (i) is likely to adversely affect the
         operating systems, structure (including but not limited to any part of
         the roof), or exterior appearance of Building B; operating systems or
         the structure of Building B, including its roof; (ii) is likely to
         materially increase the cost of operating Building B; (iii) would
         violate any governmental laws, rules or ordinances; (iv) contains or
         uses Hazardous Materials other than those permitted by all applicable
         laws; (v) is not approved or permitted by any mortgagee or beneficiary
         under any mortgage or deed of trust encumbering the Park; or (vi) is
         not in accordance with "Landlord's Building Standards", as that term is
         defined in Exhibit B to the Original Lease. If Landlord notifies Tenant
         that changes are required to any Plans, Tenant shall promptly submit to
         Landlord, for its approval, such Plans amended in accordance with the
         changes so required. Tenant shall also revise the proposed Plans and
         change the proposed Tenant Work shown on such proposed Plans to
         incorporate any work required in the relevant portion of the Expansion
         Space by any local governmental field inspector. Landlord shall deliver
         written notice (the "APPROVAL NOTICE") to Tenant of its approval of any
         Plans, provided that any Plans which Tenant has duly submitted to
         Landlord for approval shall be deemed approved by Landlord if Landlord
         fails to provide notice to Tenant of any comments of

                                      -4-

<PAGE>

         objections within 5 days after Landlord received such proposed Plans.
         Any Plans approved by Landlord or deemed approved by Landlord are
         "APPROVED PLANS". Landlord's approval of any Plans shall in no way be
         deemed to be (a) an acceptance or approval of any element in such Plans
         which is in violation of any applicable laws, ordinances, regulations
         or other governmental requirements, or (b) an assurance that work done
         pursuant to the Approved Plans will comply with all applicable laws, or
         satisfy Tenant's objectives and needs.

                  c. PERFORMANCE OF TENANT WORK. With respect to each of the two
         portions of the Expansion Space, upon Tenant's receipt of the Approval
         Notice for such portion of the Expansion Space and the Commencement
         Date of such portion of the Expansion Space, Tenant shall proceed, at
         its sole risk and cost and with due diligence, to complete all of the
         Tenant Work for such portion of the Expansion Space. Tenant shall, at
         its sole expense, obtain all required building permits for the
         construction of the Tenant Work shown on the Approved Plans and, except
         where specifically designated in the Approved Plans; shall use only
         new, first-class materials in the Tenant Work. All Tenant Work shall be
         performed only by a contractor or contractors approved by Landlord in
         advance in writing, and shall be completed in a good and workmanlike
         manner and in accordance with all applicable statutes, laws, codes and
         regulations. Tenant and Tenant's contractors shall make all efforts and
         take all steps reasonably appropriate to assure that all construction
         activities do not unreasonably interfere with the operation of the
         buildings in the Park and the ability of other occupants of the Park to
         conduct business in a routine manner. Tenant shall have no authority to
         deviate materially from the Approved Plans as approved by Landlord in
         the performance of the Tenant Work, except as authorized by Landlord in
         writing, which authorization shall not be unreasonably withheld or
         delayed. Tenant shall provide notice to Landlord of the date of the
         occurrence of the substantial completion of the Tenant Work with
         respect to each of the two portions of the Expansion Space, together
         with a statement from Tenant's architect or general contractor (the
         "SUBSTANTIAL COMPLETION CERTIFICATE") certifying that such substantial
         completion has occurred and the total cost to Tenant of all labor,
         materials, and services supplied in the construction or installation of
         the Tenant Work for such portion of the Expansion Space, together with
         all design costs and other fees and expenses properly allocable to the
         performance of the Tenant Work in such portion of the Expansion Space
         (the "PROJECT COSTS"). The Substantial Completion Certificate shall
         include an itemized listing of the total cost of the Tenant Work shown
         on such Approved Plans and copies of invoices or such other source
         documents as Landlord may reasonably request in order to verify its
         accuracy. Upon Landlord's receipt of each of the two Substantial
         Completion Certificates, Landlord shall inspect the relevant Tenant
         Work and note any deficiencies or unfinished items which, if so noted,
         Tenant shall complete with due diligence. Tenant shall perform all
         Tenant Work in accordance with all provisions of the Prior Lease,
         including but not limited to Section 10.1 of the Original Lease, which
         are not inconsistent with the terms of this Second Amendment, provided
         that Tenant shall not be obligated to post the completion and indemnity
         bond required by Section 10.1 of the Original Lease, and further
         provided that Landlord shall not be entitled to a management fee for
         managing the construction of the Tenant Work under this Second
         Amendment. Notwithstanding that Landlord shall not receive a management
         fee for managing the performance of the Tenant Work, Tenant shall

                                      -5-

<PAGE>

         reimburse Landlord, promptly after demand, as rent under the Lease, for
         all reasonable charges and fees which Landlord actually pays to
         unaffiliated third parties in connection with reviewing or inspecting
         the Tenant Work. If for any reason the Lease is terminated (either
         entirely or only with respect to all or a part of the Expansion Space)
         prior to the completion of all Tenant Work, Tenant shall, at its sole
         cost and risk, return the Expansion Space as soon as is commercially
         practicable to at least as good a condition for the purposes of leasing
         to another tenant as it was in on the date Landlord tendered possession
         of it to Tenant, and shall indemnify Landlord for all lost profits and
         all cost and expense Landlord incurs as a result of or in connection
         with the failure of the Expansion Space to be in at least as good a
         condition as it was in on the date Landlord tendered possession to
         Tenant.

                  d. ALLOWANCE. Landlord shall reimburse Tenant for all or some
         portion of the Project Costs through an allowance (the "ALLOWANCE") in
         the amount of $8.50 per rentable square foot of each of the two
         portions of the Expansion Space. The Allowance shall be payable
         separately with respect to Expansion Space #1 and Expansion Space #2 in
         accordance with this Section 3.d. Provided that no default then exists
         with respect to Tenant's obligation to pay Rent and Tenant is then
         lawfully in occupancy of the applicable portion of the Expansion Space
         in the routine conduct of its business, Landlord shall pay to Tenant a
         sum in the amount of the lower of the $8.50 per rentable square foot of
         the applicable portion of the Expansion Space Allowance or the actual
         Project Costs for such portion of the Expansion Space within 10
         business days after the last to occur of the following: (i) Landlord's
         receipt of the Substantial Completion Certificate for such portion of
         the Expansion Space; and (ii) Landlord's receipt of full lien waivers
         for all of the Tenant Work for such portion of the Expansion Space.
         Tenant shall be solely responsible for all Project Costs for such
         portion of the Expansion Space in excess of the portion of the
         Allowance payable with respect to such portion of the Expansion Space.
         Project Costs shall not include, and the Allowance shall not be payable
         with respect to, any overhead or other "internal" costs or expenses of
         Tenant, any costs or expenses which are not actually paid to third
         parties unaffiliated with Tenant, or any costs of purchasing, leasing,
         and/or installing any equipment or other personal property which will
         not become part of the Premises and the property of Landlord upon
         installation in the Expansion Space. The $8.50 per rentable square foot
         maximum shall apply collectively to both of Expansion Space #1 and
         Expansion Space #2, so that if Project Costs for one portion of the
         Expansion Space do not equal $8.50 per rentable square foot, but
         Project Costs for the other portion exceed $8.50 per rentable square
         foot, Tenant shall be entitled to be reimbursed for more than $8.50 per
         rentable square foot of Project Costs for the second portion of the
         Expansion Space, provided that the maximum amount of the Allowance
         shall remain the lesser of $216,903 or total actual Project Costs for
         the entire Expansion Space.

         4. EXTENSION OF TERM. Under the Prior Lease, the initial Term is
scheduled to expire on December 13, 2003 (the "EXPIRATION DATE"). Landlord and
Tenant hereby amend the Prior Lease by shortening the initial Term so that it
will expire on, and so that the Expiration Date of the initial Term will be, the
day before the first to occur of the Expansion Space #1 Commencement Date or the
Expansion Space #2 Commencement Date. Landlord and Tenant hereby further amend
the Lease

                                      -6-

<PAGE>

by extending the Term for the period (the "FIRST EXTENSION TERM") which
commences on the day after the Expiration Date of the initial Term (the
"EXTENSION TERM COMMENCEMENT DATE") and ends on June 30, 2006. Each successive
12-month period during the Term commencing on the first day of the month in
which the Extension Term Commencement Date occurs is an "EXTENSION TERM LEASE
Year"

         5. RENT. The monthly installments of Base Rent and the Tenant's Share
of Operating Expenses, the Tenant's Share of Tax Expenses, the Tenant's Share of
Common Area Utility Costs, and the Tenant's Share of Utility Costs under
Original Lease Sections 6.1, 6.2, and 7, during the following portions of the
First Extension Term shall be as follows:

<TABLE>
<CAPTION>
------------------------------------------------------------- -------------------------------- ----------------
EXTENSION TERM LEASE YEAR (OR PORTION)                          MONTHLY INSTALLMENT OF BASE    TENANT'S SHARE
                                                                           RENT
------------------------------------------------------------- -------------------------------- ----------------
<S>                                                           <C>                              <C>
     IF THE EXPANSION SPACE #1 COMMENCEMENT DATE IS THE
              EXTENSION TERM COMMENCEMENT DATE

During the 30-day period  commencing  on the Extension  Term
Commencement Date:                                                        $66,713                  20.84%

From the 31st day after the Extension Term Commencement Date
through the day before Expansion Space #2 Commencement
Date:                                                                    $113,008                  29.91%
------------------------------------------------------------- -------------------------------- ----------------
IF  THE  EXPANSION  SPACE  #2   COMMENCEMENT   DATE  IS  THE
EXTENSION TERM COMMENCEMENT DATE

From the Extension Term  Commencement  Date through the 30th
day after Expansion Space #1 Commencement Date                           $105,287                  27.39%
------------------------------------------------------------- -------------------------------- ----------------
From  the  later of (i) the 31st  day  after  the  Expansion
Space #1  Commencement  Date or (ii) the Expansion  Space #2
Commencement  Date,  through the end of Extension Term Lease
Year 1                                                                   $141,683                  35.69%
------------------------------------------------------------- -------------------------------- ----------------
                             2                                           $146,078                  35.69%
------------------------------------------------------------- -------------------------------- ----------------
                             3                                           $150,571                  35.69%
------------------------------------------------------------- -------------------------------- ----------------
                             4                                           $155,168                  35.69%
------------------------------------------------------------- -------------------------------- ----------------
                             5                                           $159,892                  35.69%
------------------------------------------------------------- -------------------------------- ----------------
From the first day of  Extension  Term  Lease Year 6 through
the last day of the First Extension Term                                 $164,719                  35.69%
------------------------------------------------------------- -------------------------------- ----------------
</TABLE>
                                      -7-

<PAGE>

         6. SECURITY DEPOSIT. On the date Tenant executes and delivers this
Second Amendment to Landlord, Tenant shall deliver to Landlord $80,920 as an
additional Security Deposit to be held and applied by Landlord and/or returned
to Tenant as provided in Section 4 of the Original Agreement. Accordingly, upon
Tenant's delivery of the additional Security Deposit, the total amount of the
Security Deposit under the Lease will be $164,719.

         7. PARKING. During the First Extension Term, the number of
non-exclusive, non-designated parking spaces which Tenant will be entitled to
use under Section 24 of the Original Lease shall be the product of the number of
parking spaces in the Park from time to time multiplied by the "Tenant's Share"
specified in the third column of the table in Section 5 of this Second Amendment
at the relevant times.

         8. SUBLETTING. Notwithstanding the provisions of Section 15 of the
Original Lease to the contrary: (i) Tenant shall be entitled to keep all profit
from any sublease of all or a portion of Expansion Space #2 during the 12-month
period commencing on the 31st day after the Expansion Space #2 Commencement
Date; and (ii) Landlord shall have no recapture right with respect to a sublease
of all or any portion of Expansion Space #2 during the 24-month period
commencing on the 31st day after the Expansion Space #2 Commencement Date. With
respect to any sublease of Expansion Space #2 that continues beyond the 24-month
period commencing on the 31st day after the Expansion Space #2 Commencement
Date, Landlord shall retain any right of recapture it may have with respect to
such excess portion of the sublease term. As provided in Section 15 of the
Original Lease, if Tenant subleases all or any portion of the Expansion Space
(other than Expansion Space #2 during the 24-month period provided above),
Landlord shall be entitled to receive, as rent under the Lease, 75% of all
subleasing profits with a deduction only for a reasonable leasing commission.

         9. TERMINATION OF OPTION TO EXTEND THE LEASE AND FIRST RIGHT OF OFFER.
Effective upon the full execution and delivery of this Second Amendment, all of
Landlord's obligations under Addendum 1 (Option to Extend the Lease) to the
Original Lease and Addendum 2 (First Right of Offer) to the Original Lease shall
be deemed fully satisfied and Tenant shall have no further rights whatsoever
under Addendum 1 and/or Addendum 2.

         10. CONDITIONS PRECEDENT TO EFFECTIVENESS. This Second Amendment shall
not be deemed effective and neither Landlord nor Tenant shall have any
obligation under this Second Amendment until both of the following conditions
precedent have been satisfied: (i) Landlord has received the written consent of
its lender to this Second Amendment, provided that this condition shall be
deemed satisfied upon Landlord's delivery of written notice to Tenant that
Landlord has, in its sole discretion, determined that the lender has waived its
consent rights with. respect to this Second Amendment; and (ii) Landlord has
received a written waiver by Cisco of all of its rights with respect to
Expansion Space #1, provided that this condition shall be deemed satisfied upon
Landlord's delivery of written notice to Tenant that Landlord has, in its sole
discretion, determined that Cisco has waived its rights with respect to
Expansion Space #1. Landlord hereby confirms that PRI has waived its rights with
respect to Expansion Space #2. If either one or both of the conditions

                                      -8-

<PAGE>

precedent remains unsatisfied on July 1, 2000, either Landlord or Tenant shall
be entitled to terminate this Second Amendment by delivering a written
termination notice to the other, provided that Tenant's termination notice shall
be null and void and this Second Amendment shall remain in full force and effect
if Landlord obtains satisfaction of both conditions precedent within 5 business
days after receiving Tenant's notice of termination. Upon the effectiveness of
such a termination, this Second Amendment shall be null and void with the same
effect as if it had never been executed or delivered, and Landlord shall return
to Tenant the additional Security Deposit made by Tenant under Section 6 of this
Second Amendment.

         11. BROKERS. Each of Landlord and Tenant represents and warrants to the
other that neither it nor its agents or affiliates have dealt with any broker,
finder or the like in connection with this Second Amendment, except Craig
Fordyce and David Sandlin of Colliers International, who are representing
Landlord, and Scott Daugherty of Colliers International, who is representing
Tenant, the payment of whose commissions is Landlord's responsibility under a
separate agreement between Colliers International and Landlord. Each of Landlord
and Tenant agrees to indemnify, defend and hold the other harmless from and
against all loss, expense (including reasonable attorney fees, legal costs and
court costs), damage and liability resulting from the claims of any broker or
finder (including anyone claiming to be a broker or finder) on account of any
services claimed to have been rendered to the indemnifying party in connection
with the transaction contemplated by this Second Amendment.

         12. COMMON AREA CHANGES. Landlord shall have the right, in Landlord's
sole discretion, from time to time, provided that Tenant's proximity to parking
and access to the Premises are not materially diminished other than on a
temporary basis: (i) to make changes to the Common Areas, including without
limitation, changes in the locations, size, shape and number of driveways,
entrances, parking spaces, parking areas, loading and unloading areas, ingress,
egress, direction of traffic, landscaped areas, walkways and utility raceways;
(ii) to close temporarily any of the Common Areas for maintenance, rebuilding or
other alterations so long as reasonable access to the Premises remains
available; (iii) to remove or renovate existing buildings in the Park or add
additional buildings or other improvements in the Common Areas; (iv) to use the
Common Areas while engaged in making additional improvements, repairs or
alterations to the Park; and (v) to do and perform such other acts and make such
other changes in, to or with respect to the Common Areas and Park as Landlord
may deem appropriate.

         13. ADDRESS CHANGE. The address for the payment of rent and for notices
to Landlord under or in connection with the Lease is hereby designated as:

                                      -9-

<PAGE>

                           Middlefield - Bernardo Associates LLC
                           c/o United Capital Corp., its agent
                           111 Pine Street
                           Suite 1250
                           San Francisco, CA. 94111
                           Attention: Steven F. Lachman
                           Phone:             (415) 782-3600
                           Fax:               (415) 421-0612

                  with a copy of all notices to:

                           Middlefield - Bernardo Associates LLC
                           c/o Eagle Ridge Partners LLC
                           Suite 960
                           5500 Wayzata Boulevard
                           Minneapolis MN 55416

         This SECOND AMENDMENT TO LEASE AGREEMENT is executed and delivered as
of the date first written above.

                                       DITECH CORPORATION

                                       By:        /s/ William J. Tamblyn
                                          ---------------------------------
                                       Name:     William J. Tamblyn
                                            -------------------------------
                                       Title:    VP/CFO
                                             ------------------------------

                                       MIDDLEFIELD - BERNARDO ASSOCIATES LLC

                                       By:       /s/John C. Scholz
                                          ---------------------------------
                                       Name:     John C. Scholz
                                            -------------------------------
                                       Title:    Manager
                                             ------------------------------

                                     -10-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00012-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00012-of-00352.parquet"}]]