Document:

<PAGE>   1
                                                                   Exhibit 10.11

                                201 FOREST STREET

                           MARLBOROUGH, MASSACHUSETTS

                                  OFFICE LEASE

                                  STANDARD FORM

      THIS LEASE ("Lease") made at Marlborough, Massachusetts, by and between
201 Forest Street Realty Trust, a Massachusetts partnership ("Landlord") having
a principal place of business at 293 Boston Post Road West, Suite 320,
Marlborough, Massachusetts, 01752 and Syncronicity, Inc. ("Tenant") having a
principal place of business at 47 Old Sudbury Road, Wayland, Massachusetts,
01778.

                                   WITNESSETH:

                                    ARTICLE 1
                         REFERENCE DATA AND DEFINITIONS

1.01  Reference Data

<TABLE>
<S>                                       <C>
      LANDLORD'S REPRESENTATIVE:          David Depietri
                                          Rosewood Development Corporation

      LANDLORD'S ADDRESS                  201 Forest Street Realty Trust
      (FOR PAYMENT OF RENT):              c/o Rosewood Companies
                                          293 Boston Post Road West
                                          Suite 320
                                          Marlborough, MA 01752

      LANDLORD'S ADDRESS
      (FOR NOTICE AND BILLING):           Same as Above

      TENANT:                             Syncronicity, Inc.
                                          47 Old Sudbury Road
                                          Wayland, MA 01778

      TENANT'S REPRESENTATIVE:            Eugene Connolly

      TENANT'S PHONE NUMBER:              (508)358-2856

      PREMISES:                           Suite 320

      RENTABLE AREA OF PREMISES:          4,331 Square Feet
</TABLE>
<PAGE>   2
                                      -2-

<TABLE>
<S>                                       <C>
      RENTABLE AREA OF THE BUILDING:      40,000 Square Feet

      RENT COMMENCEMENT DATE:             April 1,1997 or upon substantial
                                          completion of construction and
                                          issuance of Certificate of
                                          Occupancy.

      OCCUPANCY DATE:                     April 1,1997 or upon substantial
                                          completion of construction and
                                          issuance of Certificate of
                                          Occupancy.

      LEASE TERMINATION DATE:             Five (5) Years from the rent
                                          commencement date.

      TERM:                               Five (5) Years.

      BASIC RENT: SEE SCHEDULE BELOW:
</TABLE>

<TABLE>
<CAPTION>
                      NET, NET, NET       NET, NET, NET        NET, NET, NET
          YEAR      RATE PER SO. FT.       ANNUAL RENT         MONTHLY RENT
          ----      ----------------      -------------        --------------
<S>                 <C>                   <C>                  <C>
          1-5            $13.50             $58,468.50           $4,872.37
</TABLE>

<TABLE>
<S>                                       <C>
      ESTIMATED COST OF ELECTRICAL        Tenant to be separately metered for
      SERVICE:                            electricity.

      INITIAL MONTHLY PAYMENT
      (Basic Rent):                       $4,872.37

      TAX BASE:                           $0.00 Per Square Foot of Rentable
                                          Area per year.

      OPERATING EXPENSE BASE:             $0.00 Per Square Foot of Rentable
                                          Area per year.

      TENANT'S SHARE:                     10.8 96

      SECURITY DEPOSIT:                   $4;992.391

      GUARANTOR:                          N/A

      PERMITTED USES:                     General Office uses consistent with
                                          a first class office building.
</TABLE>
<PAGE>   3
                                      -3-

1.02  General Provisions.

      For all purposes of the Lease unless otherwise expressed and provided
herein or therein or unless the context otherwise requires:

      (a)   The words herein, hereof, hereunder and other words of words of
            similar import refer to the Lease as a whole and not to any
            particular article, section or other subdivision of this Lease.

      (b)   A pronoun in one gender includes and applies to the other genders as
            well.

      (c)   Each definition stated in Section 1.01 or 1.03 of this Lease applies
            equally to the singular and the plural forms of the term or
            expression defined.

      (d)   Any reference to a document defined in Section 1.03 of this Lease is
            to such document as originally executed, or, if modified, amended or
            supplemented in accordance with the provisions of this Lease, to
            such document as so modified, amended or supplemented and in effect
            at the relevant time of reference thereto.

      (e)   All accounting terms not otherwise defined herein have the meanings
            assigned to them in accordance with generally accepted accounting
            principles.

      (f)   All references in Section 1.01 hereof are subject to the specified
            definitions thereof (if any) in Section 1.03 hereof.

1.03  Terms Defined.

      Each term of expression set forth above in Section hereof or below in this
Section 1.03 has the meaning stated immediately after it.

      Additional Services.  Services provided to Tenant or in respect of the
      Premises which are not described in Exhibit F hereto.

      Adjusted Operating Expense Base.  The amount determined by multiplying
      the Operating Expense Base by the Adjustment Factor.

      Adjusted Tax Base.  The amount determined by multiplying the Tax Base
      by the Adjustment Factor.

      Adjustment Factor. With respect to the First Calendar Year and the Last
      Calendar Year, the percentage computed by dividing (i) the number of days
      of each such period falling within the Lease term by (ii) 365.

      Affiliate. With respect to any specified person, any other person directly
      or indirectly controlling or controlled by or under direct or indirect
      common control with such specified person. For the purposes of this
      definition, the term control when used with respect to any specified
      person means the power to direct the management and policies of
<PAGE>   4
                                      -4-

      such person, directly or indirectly, whether through the ownership of
      voting securities, by contract or otherwise, and the terms controlling and
      controlled by have meanings correlative to the foregoing.

      Authorizations. All franchises, licenses, permits and other governmental
      consents issued by Governmental Authorities pursuant to Legal Requirements
      which are or may be required for the use and occupancy of the Premises and
      the conduct or continuation of a Permitted use therein.

      Basic Services.  The services described in Exhibit F hereto.

      Building.  The building currently under construction on the Land.

      Building Standard Tenant Finishes.  The standards set bar Landlord for
      the quality of work done on the Premises.

      Business Day.  A day which is not a Saturday, Sunday or other day on
      which banks in Boston, Massachusetts, are authorized or required by law
      or executive order to remain dosed.

      Calendar Year. The First Calendar Year, the Last Calendar Year and full
      calendar year (January 1 through December 31) occurring during the Lease
      Term.

      C.P.I.  "Consumer Price Index - All Urban Consumers - (CPI-U) - U.S.
      City Average - All Items (1967=100)" as published by the U.S.
      Department of Labor.

      Common Areas. All areas devoted to the common use of occupants of the
      Building or the provision of Services to the Building, including but not
      limited to the atrium, all corridors, elevator foyers, air shafts,
      elevator shafts, and elevators, stairwells and stairs, rest rooms,
      mechanical rooms, janitor closets, vending areas and other similar
      facilities for the provision of Services or the use of all occupants of
      multi-tenant floors or all occupants of the Building.

      Control.  As defined in the definition of Affiliate.

      Corporation.  A corporation, company, association, business trust or
      similar organization wherever formed.

      Default. Any event or condition specified in Article 20 hereof so long as
      any applicable requirement for the giving of notice or lapse of time or
      both have not been fulfilled.

      Event of Default. Any event or condition specified in (a) Article 20
      hereof (if all applicable periods for the giving of notice or lapse of
      time or both have been fulfilled) or (b) in Article 21 hereof.

      Fair Rental Value. The amount per square foot per annum which a Person not
      an Affiliate or either Landlord or Tenant would pay as Basic Rent (using
      the Tax Base and
<PAGE>   5
                                      -5-

      Operating Expense Base) as of the time of determination for the Premises
      for a term of four years. All Additional Rent such as Taxes, Operating
      Expenses and Estimated Cost of Electrical Service shall be in addition to
      the price per square foot so determined.

      First Calendar Year.  The partial Calendar Year period commencing on
      the Term Commencement Date and ending on the next succeeding December
      31.

      Force Majeure. Acts of God, strikes, lock outs, labor troubles, inability
      to procure materials, failure of power, restrictive Legal Requirements,
      riots and insurrection, acts of public enemy, wars, earthquakes,
      hurricanes and other natural disasters, fires, explosions, any act,
      failure to act or Default of the other party to this Lease; provided,
      however, lack of money shall not be deemed such a cause.

      General Contractor.  Triton Construction Corp.

      Governmental Authority. United States of America, the Commonwealth of
      Massachusetts, the County of Middlesex, City of Marlborough, and any
      political subdivision thereof and any agency, department, commission,
      board, bureau or instrumentality of any of them.

      Insolvency. The occurrence with respect to any Person of one or more of
      the following events: the death, dissolution, termination of existence
      (other than by merger or consolidation), insolvency, appointment of a
      receiver for all or substantially all of the property of such person, the
      making of a fraudulent conveyance or the execution of an assignment or
      trust mortgage for the benefit of creditors by such Person, or the filing
      of a petition of bankruptcy or the commencement of any proceedings by or
      against such Person under a bankruptcy, insolvency or other law relating
      to the relief or the adjustment of indebtedness, rehabilitation or
      reorganization of debtors; provided that if such petition or commencement
      is involuntarily made against such a Person and is dismissed within sixty
      (60) days of the date of such filing or commencement, such events shall
      not constitute an insolvency hereunder.

      Insurance Requirements. All terms of any policy of insurance maintained by
      Landlord or Tenant and applicable to (or affecting any condition,
      operation, use or occupancy of) the Building or the Premises or any part
      or parts of either and all requirements of the issuer of any such policy
      and all orders, rules, regulations and other requirements of the National
      Board of Fire Underwriters (or any other body exercising similar
      functions).

      Land.  The land on 201 Forest Street, Marlborough, Massachusetts County
      of Middlesex, Commonwealth of Massachusetts.

      Landlord's Contribution.  The amount contributed by Landlord as a
      credit toward the cost of finishing the Premises shown in Exhibit B.

      Landlord's Work.  The work to be done by Landlord with respect to the
      Premises described in Exhibit B.
<PAGE>   6
                                      -6-

      Last Calendar Year. The partial Calendar Year commencing on January 1 of
      the Calendar Year in which the Lease Termination Date occurs and ending on
      the Lease Termination Date.

      Lease Term.  The period commencing on the Term Commencement Date and
      ending on the Lease Termination Date.

      Lease Termination Date. The earlier to occur of (1) the Stated Expiration
      Date, (2) the termination of this Lease by Landlord as the result of an
      Event of Default, (3) the termination of this Lease pursuant to Article 17
      (Damage or Destruction) or 18 (Eminent Domain) hereof.

      Lease Year. A period commencing on the Term Commencement Date (or an
      anniversary thereof) and ending on the Day before the next succeeding
      anniversary thereof. For example, the first Lease Year is a period
      commencing on the Term Commencement Date and ending on the day before the
      first anniversary thereof. The last Lease Year shall end on the Lease
      Termination Date.

      Legal Requirements. All statutes, codes, ordinances (and all rules and
      regulations thereunder), all executive orders and other administrative
      orders, judgments, decrees, injunctions and other judicial orders of or by
      any Governmental Authority which may at any time be applicable to parts or
      appurtenances of the Premises or Building or to any condition or use
      thereof and the provisions of all Authorizations.

      Occupancy Arrangement. With respect to the Premises or any portion thereof
      of the Lease, and whether (a) written or unwritten or (b) for all or any
      portion of the Lease Term, an assignment, a sublease, any tenancy at will,
      a tenancy at sufferance, or any other arrangement (including but not
      limited to a license or concession) pursuant to which a Person occupies
      the Premises for any purpose.

      Operating Expense Base. With respect to each Calendar Year the amount
      determined by multiplying the Rentable Area of the Premises by the amount
      hereinbefore set forth as the Operating Expense Base per square foot of
      Rentable Area per year, but with respect to the First Calendar Year and
      the Last Calendar Year, the Adjusted Operating Expense Base.

      Operating Expenses. All expenses, costs, and disbursements of every kind
      and nature which Landlord shall pay or become obligated to pay in
      connection with the ownership, operation and maintenance of the Building
      (including all facilities in operation on the Term Commencement Date and
      such additional facilities which are necessary or beneficial for the
      operation of the Building) and the Land and the provision of Basic
      Services, including, but not limited to (a) wages, salaries, fees and
      costs to Landlord of all Persons engaged in connection therewith,
      including taxes, insurance, and benefits relating thereto; (b) the cost of
      (i) all supplies and materials, electricity and lighting, for Common
      Areas, (ii) water, heat, air conditioning, and ventilation for the
      Building, (iii) all maintenance, janitorial, and service agreements, (iv)
      all insurance, including the cost of casualty and liability insurance
      applicable to the Building and Landlord's personal
<PAGE>   7
                                      -7-

      property used in connection therewith, (v) repairs and general
      maintenance, (vi) capital items which are primarily for the purpose of
      reducing Operating Expenses or which may be required by a Governmental
      Authority, amortized over the reasonable life of the capital items with
      the reasonable life and amortization schedule being determined by Landlord
      in accordance with generally accepted accounting principles, (vii)
      pursuing an application for an abatement of taxes pursuant to Section 6.05
      hereof to the extent not deducted from the abatement, if any, received,
      (viii) independent auditors, (ix) Landlord's central accounting functions,
      and (x) providing office space for the manager of the Building; (c)
      management fees; and (d) a share (equal to percentage computed by a
      fraction the numerator of which is the Rentable Area of the Building and
      the denominator of which is the aggregate Rentable Area of all constructed
      buildings (including the Building at 201 Forest Street, Marlborough) of
      the cost to Landlord of operating, repairing and maintaining exterior
      common areas and facilities of 201 Forest Street, Marlborough (of which
      development the Building is a part) which may not be located entirely on
      the Land but which are available for landscaping, security and maintenance
      for common roadways and open areas. Operating Expenses shall not include
      (i) capital items except as provided above or (ii) specific costs billed
      to and paid by specific tenants. Operating Expenses shall be determined
      using the accrual of accounting. If at any time during the Term, less than
      ninety-five percent (95 %) of the Rentable Area of the Project is
      occupied, the "operating expenses" component of Operating Expenses shall
      be adjusted by Landlord to reasonably approximate the operating expenses
      which would have been incurred if the Project had been at least
      ninety-five percent (95%) occupied.

      Partial Taking.  Any Taking which is not a Total Taking.

      Permitted Exceptions. Any liens or encumbrances on the Premises in the
      nature of (a) liens for taxes assessed but not yet due and payable, (b)
      easements, reservations, restrictions and rights of way encumbering or
      affecting the Land on the date of this Lease, (c) the rights of Landlord,
      Tenant and any other Person to whom Landlord has granted such rights to
      exercise in common with respect to the Land and the Common Areas the
      rights granted to Tenant hereunder, (d) mortgages of record, and (e) Title
      Conditions.

      Person.  An individual, a Corporation, a company, a voluntary
      association, a partnership, a trust, an unincorporated organization or
      a government or any agency, instrumentality or political subdivision
      thereof.

      Premises.  The space in the Building shown outlined in red on Exhibit B
      hereto.

      Proceeds. With respect to any Taking or occurrence described in Article 17
      hereof, with respect to which any Person is obligated to pay any amount to
      or for the account of Landlord, the aggregate of (i) all sums payable or
      receivable under or in respect of any insurance policy, and (ii) all sums
      or awards payable in respect to a Taking.

      Prohibited Occupancy Arrangement. An Occupancy Arrangement which provides
      for any rent or other payment based in whole or in part on the net income
      or profits derived by any person from the Premises.
<PAGE>   8
                                      -8-

      Rent.  Basic Rent and all Additional Rent.

      Rentable Area of the Premises. The number of square feet stated in Section
      1.01, whether the same should be more or less as a result of minor
      variations resulting from actual construction and completion of the
      Building or Premises so long as such work is done in accordance with the
      terms and provisions hereof. The calculation was made according to the
      following formula:

      (i)   On single tenant floors, the usable area measured from the inside
            surfaces of the outer glass of the Building, plus Tenant's Share of
            Common Areas.

      (ii)  On multi-tenant floors, the usable area measured from inside surface
            of the outer glass of the Building to the midpoint of all demising
            walls of the space being measured plus the area of each corridor
            adjacent to and required as the result of the layout of the space
            being measured, measured from the midpoint of the adjacent demising
            walls, plus Tenant's Share of Common Areas.

      Rules and Regulations. Reasonable rules and regulations promulgated by
      Landlord and uniformly applicable to persons occupying the Building
      regulating the details of the operation and use of the Building. The
      initial Rules and Regulations are attached hereto as Exhibit G.

      Services.  Basic Services and Additional Services.

      Special Work.  Work done in or with respect to the Premises which is
      not part of Landlord's Work or the cost of which exceeds Landlord's
      Contribution.

      Stated Expiration Date.  The last day of the last Lease Year of the
      Term stated in Section 1.01.

      Substantial Completion Date. The date on which the Premises together with
      the appurtenant areas of the Building necessary for access and service
      thereto, have been completed in accordance with Article 7 hereof except
      for items of work and adjustment of equipment and fixtures which are not
      necessary to make the Premises reasonably tenantable for the Permitted
      Uses and because of season or weather or nature of the item cannot
      practicably be done at the time.

      Taking. The taking or condemnation of title to all or any part of the Land
      or the possession or use of the Building or the Premises by a person for
      any public use or purpose or any proceeding or negotiations which might
      result in such a taking or any sale or lease in lieu of or in anticipation
      of such a taking.

      Tax Base. With respect to each Calendar Year the amount determined by
      multiplying the Rentable Area of the Premises by the amount hereinbefore
      set forth as the Tax Base per square foot of Rentable Area per year, but
      with respect to the First Calendar Year and the Last Calendar Year, the
      Adjusted Tax Base.
<PAGE>   9
                                      -9-

      Taxes. All taxes, special or general assessments, water rents, rates and
      charges, sewer rents and other impositions and charges imposed by
      Governmental Authorities of every kind and nature whatsoever,
      extraordinary as well as ordinary and each and every installment thereof
      which shall or may during the term of this Lease be charged, levied, laid,
      assessed, imposed, become due and payable or become liens upon or for or
      with respect to the Land or any part thereof or the Building or the
      Premises, appurtenances or equipment owned by Landlord thereon or therein
      or any part thereof or on this Lease under or by virtue of all present or
      future Legal Requirements and are tax based on a percentage, fraction or
      capitalized value of the Rent (whether in lieu of or in addition to the
      taxes hereinbefore described). Taxes shall not include inheritance,
      estate, excise, succession, transfer, gift, franchise, income, gross
      receipt, or profit taxes except to the extent such are in lieu of or in
      substitution for Taxes as now imposed on the Building, the Land, the
      Premises or this Lease.

      Tenant.  As defined in the preamble hereof.

      Tenant's Cost.  The cost of work done in connection with the completion
      of the Premises in excess of (i) the cost of Landlord's Work and (ii)
      Landlord's Contribution.

      Tenant's Share. Tenant's share of building is equal to T divided by B x
      100%, where "T" is equal to the number of rentable square feet rented by
      the Tenant and "B" is equal to 95% of the total rentable square feet of
      the building.

      Term Commencement Date. The earlier of (a) the later of (x) the date
      specified by Landlord in the notice delivered pursuant to Section 7.03 or
      (y) the Substantial Completion Date, or (b) any other date for such
      commencement determined in accordance with said Article 7, or (c) the date
      on which Tenant first occupies the Premises for the Permitted Uses.

      Title Conditions.  All covenants, agreements, restrictions, easements
      and declarations of record on the date hereof so far as the same may be
      from time to time in force and applicable.

      Total Taking. (i) a Taking of: (a) the fee interest in all or
      substantially all of the Building or (b) such title to, easement in, over,
      under or such rights to occupy and use any part or parts of the Building
      to the exclusion of Landlord as shall have the effect, in the good faith
      judgement of the Landlord, of rendering the portion of the Building
      remaining after such Taking (even if restoration were made) unsuitable for
      the continued use and occupancy of the Building for the Permitted Uses or
      (ii) a Taking of all or substantially all of the Premises or such title to
      or easement in, on or over the Premises to the exclusion of Tenant which
      in the good faith judgement of the Landlord prohibits access to the
      Premises or the exercise by Tenant of any rights under this Lease.

      Working Drawings. The Working Drawings for the finishing of the Premises
      developed by Landlord and Tenant. The Working Drawings shall be prepared
      in compliance with all applicable Legal Requirements and stamped by
      registered Massachusetts professionals,
<PAGE>   10
                                      -10-

      and shall consist of all architectural and engineering plans which are
      required to finish the Premises or to obtain any Authorization required
      therefor.
<PAGE>   11
                                      -11-

                  Table of Contents by Articles and Sections

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
1.    Reference Data and Definitions.

      1.01 Reference Data .............................................
      1.02 General Provisions .........................................
      1.03 Terms Defined ..............................................
      1.04 Table of Contents ..........................................

2.    Premises.

      2.01 Premises....................................................
      2.02 Appurtenances ..............................................

3.    Term.

      3.01 Term Commencement ..........................................
      3.02 Termination ................................................

4.    Rent.

      4.01 Basic Rent .................................................
      4.02 Computation of Basic Rent ..................................
      4.03 Intentionally Omitted ......................................
      4.04 Resolution of Disputes with Respect to Fair Rental Value,
Arbitration ...........................................................

5.    Use of Premises.

      5.01 Use Restricted .............................................

6. Taxes; Operating Expenses; Estimated Cost of Electrical Services.

      6.01 Expenses and Taxes .........................................
      6.02 Annual Statement of Additional Rent Due ....................
      6.03 Monthly Payments of Additional Rent ........................
      6.04 Accounting Periods .........................................
      6.05 Abatement of Taxes .........................................
      6.06 Electric Service; Payment of Additional Rent ...............
      6.07 Change in Rates or Usage ...................................
      6.08 Late Payment of Rent .......................................

7.    Improvements, Repairs, Additions, Replacements.

      7.01 Preparation of the Premises ................................
</TABLE>
<PAGE>   12
                                      -12-

<TABLE>
<S>                                                                          <C>
      7.02 Time for Completion ........................................
      7.03 Notice to Commence .........................................
      7.04 Delays......................................................
      7.05 Tenant's Access to the Premises ............................
      7.06 Alterations and Improvements ...............................
      7.07 Maintenance ................................................
      7.08 Redelivery .................................................

8.    Building Services.

      8.01 Building Services ..........................................
      8.02 Other Janitors .............................................
      8.03 Additional Services ........................................
      8.04 Limitation on Landlord's Liability .........................
      8.05 Electric Service ...........................................

9.    Tenant's Particular Covenants.

      9.01 Pay Rent ...................................................
      9.02 Occupancy of the Premises ..................................
      9.03 Safety .....................................................
      9.04 Equipment...................................................
      9.05 Electrical Equipment .......................................
      9.06 Pay Taxes...................................................
      9.07 Tenant's Covenants .........................................

10.   Requirements of Public Authority.

      10.01 Legal Requirements ........................................
      10.02 Contests...................................................

11.   Covenant Against Liens.

      11.01 Mechanics Liens ...........................................
      11.02 Right to Discharge ........................................

12.   Access to Premises.

      12.01 Access.....................................................

13.   Assignment and Subletting; Company Arrangements.

      13.01 Subletting and Assignments ................................
</TABLE>
<PAGE>   13
                                      -13-

<TABLE>
<S>                                                                          <C>
14.   Indemnity.

      14.01 Tenant's Indemnity ........................................
      14.02 Landlord's Liability ......................................

15.   Insurance.

      15.01 Liability Insurance .......................................
      15.02 Casualty Insurance ........................................

16.   Waiver of Subrogation.

      16.01 Waiver of Subrogation .....................................
      16.02 Waiver of Rights ..........................................

17.   Damage of Destruction.

      17.01 Substantial Damage ........................................
      17.02 Restoration ...............................................

18.   Eminent Domain.

      18.01 Total Taking ..............................................
      18.02 Partial Taking ............................................
      18.03 Awards and Proceeds .......................................

19.   Quiet Enjoyment.

      19.01 Landlord's Covenant .......................................
      19.02 Subordination .............................................
      19.03 Notice to Mortgage ........................................
      19.04 Other Provisions Regarding Mortgages ......................

20.   Defaults; Events of Default.

      20.01 Defaults...................................................
      20.02 Tenant's Best Efforts .....................................
      20.03 Elimination of Default ....................................
      20.04 Tenant's Default - Rent Abatement Cancellation ............

21.   Insolvency.

      21.01 Insolvency ................................................
</TABLE>
<PAGE>   14
                                      -14-

<TABLE>
<S>                                                                          <C>
22.   Landlord's Remedies; Damages on Default.

      22.01 Landlord's Remedies .......................................
      22.02 Surrender..................................................
      22.03 Right to Relet ............................................
      22.04 Survival of Covenants .....................................
      22.05 Right to Equitable Relief .................................
      22.06 Right to Self Help; Interest on Overdue Rent ..............
      22.07 Further Remedies ..........................................

23.   Waivers.

      23.01 No Waivers.................................................

24.   Security Deposit.

      24.01 Security Deposit ..........................................

25.   General Provisions.

      25.01 Force Majeure .............................................
      25.02 Notices and Communications ................................
      25.03 Certificates, Estoppel Letter .............................
      25.04 Renewal....................................................
      25.05 Governing Law .............................................
      25.06 Partial Invalidity ........................................
      25.07 Notice of Lease ...........................................
      25.08 Interpretation; Consents ..................................
      25.09 Parties....................................................
      25.10 Waiver of Trial by Jury ...................................

26.   Miscellaneous.

      26.01 Expansion Space ...........................................
      26.02 Exterior Landscaping ......................................
      26.03 Holdover Clause ...........................................
      26.04 Exterior Signage ..........................................

27.   Entire Agreement.

      27.01 Entire Agreement ..........................................
</TABLE>
<PAGE>   15
                                      -15-

                                    ARTICLE 2
                                    PREMISES

2.01 Premises.

      Landlord hereby leases and lets to Tenant, and Tenant hereby takes and
hires from Landlord, upon and subject to the terms, conditions, covenants and
provisions hereof, the Premises subject to the Permitted Exceptions. Landlord
reserves the right to relocate within or without the Premises pipes, ducts,
vents, flues, conduits, wires and appurtenant fixtures which service other parts
of the Building; provided that such work is done in such a manner that it does
not unreasonably interfere with Tenant's use of the Premises.

2.02  Appurtenances.

      Tenant may use the Common Areas and the Land as appurtenant to the
Premises for the purposes for which they were designed.

                                    ARTICLE 3
                                      TERM
3.01  Term Commencement.

      The Lease Term shall commence on the Term Commencement Date.

3.02  Termination.

      The Lease Term shall end on the Lease Termination Date.

                                    ARTICLE 4
                                      RENT

4.01  Basic Rent.

      Tenant shall pay Landlord for the Premises, without offset or deduction
and without previous demand therefor, the Basic Rent as annual rent for each
Lease Year. Basic Rent shall be paid in equal monthly installments in advance on
the first day of each calendar month during the Lease Term. The first
installment of Basic Rent should be paid on the Rent Commencement Date.
Subsequent installments of Basic Rent shall be paid on the first day of every
calendar month thereafter. Basic Rent for partial months at the beginning or end
of the Lease Term shall be pro-rated and paid on the Term Commencement Date and
the first day of the calendar month in which the Lease Termination Date is to
occur. If an Event of Default occurs at any time during the term of this Lease,
as outlined under Article 20 of this Lease, Landlord shall have the option of
retracting any rent abatement, and Tenant shall pay the full abated amount
immediately to Landlord upon demand.
<PAGE>   16
                                      -16-

4.02  Computation of Basic Rent.

      The Basic Rent for each the first five (5) Lease Years shall be stated in
Article 1.01 hereof.

      Basic Rent so determined shall be exclusive of (and in addition to)
amounts due hereunder for Taxes, Operating Expenses and Estimated Cost of
Electrical Service.

4.03  Intentionally Omitted.

                                    ARTICLE 5
                                 USE OF PREMISES

5.01  Use Restricted.

      The Premises may be used for the Permitted Uses and for no other purpose.
No improvements may be made in or to the Premises except as otherwise provided
in this Lease.

                                    ARTICLE 6
       TAXES; OPERATING EXPENSES; ESTIMATED COST OF ELECTRICAL SERVICES

6.01  Expenses and Taxes.

      If with respect to any Calendar Year, Tenant's Share of (a) Operating
Expenses exceeds the Operating Expense Base or (b) Taxes exceeds the Tax Base
(whether as the result of an increase in rate or assessment or both), Tenant
shall pay to Landlord the amount of each such excess. Any amount due with
respect to this Section 6.01 shall be due on the date which is five (5) days
after receipt by the Tenant of the statement described in Section 6.02 hereof.

6.02  Annual Statement of Additional Rent Due.

      Landlord shall render to Tenant a statement, showing (i) for the Calendar
Year so indicated (a) Taxes and (b) Operating Expenses and (ii) for the then
current Calendar Year, and estimate for (a) Operating Expenses (b) Taxes and (c)
Tenant's obligation under Section 6.01.

6.03  Monthly Payments of Additional Rent.

      Tenant shall pay to Landlord in advance for each calendar month as
Additional Rent an amount equal to 1/12th of Tenant's estimated obligation under
Section 6.01 shown thereon. The amount due under this Section 6.03 shall be paid
with Tenant's monthly payments of Basic Rent and shall be credited by Landlord
to Tenant's obligations under Section 6.01. If the total amount paid hereunder
exceeds the amount due under such Section, such excess shall be credited by
Landlord against the monthly installments of Additional Rent next falling due or
shall be refunded to Tenant upon the expiration or termination of this Lease
(unless such expiration or termination is the result of an Event of Default).
<PAGE>   17
                                      -17-

6.04  Accounting Periods.

      Landlord shall have the right from time to time to change the periods of
accounting hereunder to any other annual period than a Calendar Year, and upon
any such change, all items referred to in this Article 6 shall be appropriately
apportioned. In all statements rendered under Section 6.02, amounts for periods
partially within and partially without the accounting periods shall be
appropriately apportioned, and any items which are not determinable at the time
of a statement shall be included therein on the basis of Landlord's estimate and
with respect thereof Landlord shall render promptly after determination a
supplemental statement and appropriate adjustment shall be made according
thereto.

6.05  Abatement of Taxes.

      Landlord may at any time and from time to time make application to the
appropriate Governmental Authority for an abatement of Taxes. Landlord shall
make such an application at any time Tenant's occupying more than 60% of the
Rentable Area of the Building under written Occupancy Arrangements directly with
the Landlord request that Landlord do so. If (i) such an application is
successful and (ii) Tenant has made any payment in respect of Taxes pursuant to
this Article 6 for the period with respect to which the abatement was granted,
Landlord shall (a) deduct from the amount of the abatement all expenses incurred
by it in connection with the application (b) pay to Tenant Tenant's share
(adjusted for any period for which Tenant has made a partial payment) of
abatement, with interest, if any, paid by the Governmental Authority on such
abatement and (c) retain the balance, if any.

6.06  Electric Service; Payment as Additional Rent.

      The Estimated Cost of Electrical Service if applicable, is Landlord's
estimate of the cost (on the date hereof) of lighting the Premises and operating
Tenant's office equipment This estimate is based on information supplied to
Landlord by Tenant and shall be subject to adjustment as hereinafter set forth.
Tenant shall reimburse Landlord for the cost of providing such electrical energy
by paying to Landlord the estimated Cost of Electrical Service. Tenant shall pay
Landlord (without previous demand therefor) such amount in monthly installments
on the same day on which Basic Rent is due. If Tenant (a) connects equipment (i)
other than normal office equipment or (ii) which operates in excess of 120 volts
nominal to the Building Distribution System or (b) operates any such equipment
beyond normal operating hours, the Estimated Cost of Electrical Service shall be
increased by an amount which will reflect the cost to Landlord of the additional
electrical service to be furnished by Landlord. If Landlord and Tenant cannot
agree on the amount of such increase, such amount shall be conclusively
determined by a reputable independent electrical engineer or consulting firm to
be selected by Landlord and paid equally by both parties. All additional risers
or other equipment required for equipment other than normal office equipment or
equipment which operates on 120 volts nominal shall be provided by Landlord, and
the cost thereof shall be paid by Tenant.
<PAGE>   18
                                      -18-

6.07  Change in Rates or Usage.

      The Estimated Cost of Electrical Service is based on current rates for
such service and Landlord's good faith estimate of the usage of electricity by
Tenant If at any time after the date of this Lease, (i) the rates at which
Landlord purchases electrical energy from the public utility supplying
electrical service to the Building, or any charges incurred or Taxes payable by
Landlord in connection therewith shall be increased or decreased or (ii) the
usage by Tenant exceeds Landlord's estimate thereof, the Estimated Cost of
Electrical Service shall be increased or decreased, as the case may be, by an
amount equal to the estimated increase or decrease, as the case may be, in
Landlord's cost of furnishing the electricity referred to above as a result of
such increase or decrease in rates, charges, taxes or usage.

6.08  Late Payment of Rent.

      If any installment of fixed rent or additional rent is not received in
full within five (5) days of its due date then, in addition to any other rights
or remedies of the Landlord, upon demand of Landlord, Tenant shall pay for each
month that rental payments are not timely made, a sum equal to ten percent (10%)
of each unpaid portion of such monthly installment as a liquidated damages
charge arising out of and occurring as the result of each such late payment.

      In the event that Tenant makes three or more late payments of rent during
the Term, Landlord may deem such action to constitute an Event of Default
sufficient to terminate (i) the Lease (ii) any provision for exercise by Tenant
of any option rights under the Lease or (iii) both.

                                    ARTICLE 7
                IMPROVEMENTS, REPAIRS, ADDITIONS, REPLACEMENTS

7.01  Preparation of the Premises.

      Landlord shall perform Landlord's Work as set forth in Exhibit C. p3862Y
All other work must be of a quality equal to or better than the Building
Standard Tenant Finishes. Landlord shall also do the work described in the
Working Drawings. If (i) the cost of such work exceeds Landlord's Contribution
or (ii) Landlord further agrees to do, at Tenant's request, any Special Work,
Tenant shall pay the amount of Tenant's Cost to Landlord.

7.02  Time for Completion.

      Landlord shall use due diligence to have the Premises ready for occupancy
on or before the Estimated Term Commencement Date. Reference is made in Exhibit
"B" for details of the completion process.

7.03  Notice to Commence.

      Approximately fifteen (15) days prior to the Substantial Completion Date,
at Tenant's written request, Landlord shall furnish Tenant a notice stating the
Term Commencement Date.
<PAGE>   19
                                      -19-

7.04  Delays.

      If Landlord shall be delayed in substantially completing the work in the
Premises as the result of:

      (a) delay in delivery to Landlord of any plans, design work and
detailed drawing, or

      (b) Tenant's requests for Special Work. (notwithstanding Landlord's
approval of such changes), or

      (c) delays in performance by Tenant or any Person employed by Tenant which
shall cause delays in the completion of any work to be done by Landlord or which
shall otherwise delay the substantial completion of the Premises, or

      (d) any fault, negligence, omission, or failure to act on the part of
Tenant or its agents, contractors, workmen, mechanics, suppliers or invitees,
the Premises shall be deemed to be substantially completed on (and the Term
Commencement Date shall be) the Estimated Term Commencement Date.

7.05  Tenant's Access to the Premises.

      Tenant and Tenant's agents, at Tenant's sole risk, may, with Landlord's
prior consent, enter the Premises prior to the Term Commencement Date in order
to do such work as may be required to make the Premises ready for Tenant's use
and occupancy thereof. If Landlord permits such entry prior to the Term
Commencement Date, such permission shall be conditioned upon Tenant and Tenant's
agents, contractors, workmen, mechanics, suppliers and invitees, working in
harmony with Landlord and the General Contractor and with other Tenant's and
occupants of the Building. If at any time such entry shall cause or threaten to
cause disharmony or otherwise interfere with the orderly completion of operation
of the Building Landlord shall have the right to withdraw such permission upon
twenty-four (24) hours written notice to Tenant. Any such entry into and
occupation of the Premises shall be deemed to be under all of the terms,
covenants, conditions and provisions of this Lease except the covenant to pay
Rent landlord shall not be liable in any way for any injury, loss or damage
which may occur to any of Tenant's work and installations made in the Premises
or to properties placed therein prior to the Term Commencement Date, the same
being at Tenant's sole risk.

7.06  Alterations and Improvements.

      Tenant shall not make alterations or additions to the Premises except in
accordance with plans and specifications therefore first approved by Landlord.
Tenant shall not hang shades, curtains, signs, awnings or other materials,
attach any materials to or make any change in the appearance of any glass
visible from outside of the Premises, add any window treatments of any kind or
make improvements or install furniture visible from outside of the Premises,
without Landlord's prior written consent Without limitation, Landlord shall not
be deemed unreasonable for withholding approval of any alterations or additions
which would (a) delay completion of the Premises or the Building or (b) require
unusual expense to readapt the Premises to normal office use upon termination of
this Lease or increase (i) the cost of (a) construction or (b) insurance or
<PAGE>   20
                                      -20-

(ii) Taxes. All alterations and additions shall be part of the Premises unless
and until Landlord shall specify the same for removal in a notice delivered to
Tenant on or before the Lease Termination Date. All of Tenant's alterations and
additions and installation of furnishings shall be coordinated with any work
being performed by Landlord and in such manner as to maintain harmonious labor
relations and not to damage the Building or the Premises or interfere with
Building operation and, except for installation of furnishings, shall be
performed by contractors or workman first approved by Landlord. Except for work
done by or through Landlord, Tenant before its work is started shall: secure all
licenses and permits necessary therefor; deliver to Landlord a statement of the
names of all its contractors and subcontractors and the estimated cost of all
labor and material to be furnished by them; and cause each contractor to carry
workmen's compensation insurance in statutory amounts covering all the
contractor's and subcontractor's employees and comprehensive public liability
insurance with limits as Landlord may reasonably require, but in no event less
than $1,000,000.00 and property damage insurance with limits of not less than
$1,000,000.00 and have deductibles of no more this $5,000.00 (all such insurance
to be written in companies approved by Landlord and insuring Landlord and Tenant
as well as the contractors), and to deliver to Landlord certificates of all such
insurance. Tenant agrees to pay promptly when due the entire cost of any work
done in the Premises by Tenant, its agents, employees or independent
contractors, and not to cause or permit any liens therewith to attach to the
Premises and immediately to discharge any such liens which may so attach. All
construction work done by Tenant, its agents, employees or independent
contractors shall be done in a good and workmanlike manner and in compliance
with all Legal Requirements and Insurance Requirements. Landlord shall promptly
give notice to Tenant of any observed defects.

7.07  Maintenance.

      Tenant shall, at all times during the Lease Term, and at its own cost and
expense, (i) keep and maintain (or cause to be kept and maintained) the Premises
in good repair and condition (ordinary wear and tear and damage by fire or
casualty only excepted) and (ii) use all reasonable precaution to prevent waste,
damage or in this thereto.

7.08  Redelivery.

      On the Lease Termination Date, Tenant shall quit and surrender the
Premises free and dear of all Tenant's, occupants, liens, and encumbrances
whatsoever except (i) Permitted Exceptions and (ii) encumbrances, restrictions
or reservations caused by or consented to by Landlord. Tenant shall, subject to
the provisions of Articles 17 and 18 hereof, surrender the Premises to Landlord
broom clean and in good condition and repair (ordinary wear and tear, damage by
fire or casualty only excepted) with all damages occasioned by Tenant's removal
of Tenant's fixtures or equipment repaired at Tenant's cost to Landlord's
satisfaction.
<PAGE>   21
                                      -21-

                                    ARTICLE 8
                                BUILDING SERVICES

8.01  Building Services.

      Landlord shall furnish, or cause to be furnished, during the Lease Term
the Basic Services.

8.02  Other Janitors.

      No persons shall be employed by Tenant to do janitorial work in the
Premises and no persons other than the janitors of the Building shall clean the
Premises unless Landlord shall give its written consent thereto. Any person
employed by Tenant with Landlord's consent to do janitorial work shall, while in
the Building either inside or outside the Premises, be subject to and under the
control and direction of the superintendent of the Building (but not as agent or
servant of said superintendent or of Landlord).

8.03  Additional Services.

      Tenant will pay the Landlord a reasonable charge for any extra cleaning of
the Premises required because of the carelessness or indifference of Tenant and
for any Additional Services rendered at the request of Tenant. If the cost of
cleaning the Premises shall be increased due to the installation in the
Premises, at Tenant's request, of any unique or special materials, finish or
equipment, Tenant shall pay the Landlord an amount equal to such increase in
cost All charges for Additional Services shall be due and payable within ten
(10) days of the date on which they are billed.

8.04  Limitations on Landlord's Liability.

      Landlord shall not be liable in damages, not in default hereunder, for any
failure or delay in furnishing any Basic Service or Additional Service when such
failure or delay is occasioned by Force Majeure or by the act or Default of
Tenant No such failure or delay shall be held or pleaded as eviction or
disturbance in any manner whatsoever of Tenant's possession or give Tenant any
right to terminate this Lease or give rise to any claim for set-off of any
abatement of Rent or of any of Tenant's obligations under this Lease.

8.05  Electric Service.

      Subject to Section 6.06 Landlord shall furnish electrical energy required
for lighting the Premises and operating Tenant's office equipment used in the
Premises, provided, however, Landlord may, at any time, elect to discontinue the
furnishing of electrical energy. In the event of any such election by Landlord:
(1) Landlord shall give reasonable advance notice of any such discontinuance to
Tenant; (2) Landlord shall permit Tenant to receive electrical service directly
from the public utility supplying service to the Building and to use (in common
with others) the existing feeders, risers, wiring and other electrical
facilities serving the Premises for such purpose to the extent they are suitable
and safely capable; (3) Landlord shall pay such charges and costs, if any, as
such public utility may impose in connection with the installation of Tenant's
<PAGE>   22
                                      -22-

meters and pay for such other installations as such public utility may require,
as a condition to providing comparable electrical service to Tenant, (4)
Tenant's obligations under Section 6.06 shall end; and (5) Tenant shall
thereafter pay, directly to the utility furnishing the same, all charges for
electrical services to the Premises promptly when due.

                                    ARTICLE 9
                          TENANT'S PARTICULAR COVENANTS

9.01 Pay this Rent.

      Tenant shall pay when due all Rent and all charges for utility services
rendered to the Premises not included in Rent and, as further Additional Rent,
all charges of Landlord for Additional Services.

9.02  Occupancy of the Premises.

      Tenant shall occupy the Premises continuously from the Term Commencement
Date for the Permitted Uses only. Tenant shall not (i) injure or deface the
Premises or the Building (ii) install any sign in or on any window, demising
wall or Common Area, (iii) permit in the Premises any flammable fluids or
chemicals not reasonably related to the Permitted Uses nor (iv) permit nuisance
or any use thereof which is improper, offensive, contrary to any Legal
Requirement or Insurance Requirement or liable to render any alteration or
addition to the Building.

9.03  Safety.

      Tenant shall keep the Premises equipped with all safety appliances
required by Legal Requirements or Insurance Requirements because of any use made
by Tenant. Tenant shall procure all Authorizations so required because of such
use and, if requested by Landlord, this do any work so required because of such
use, it being understood that the foregoing provision shall not be construed to
broaden in any way the Permitted Uses.

 9.04 Equipment.

      Tenant shall not place a load upon the floor of the Premises exceeding the
live load for which the floor has been designed; and shall not move any safe or
other heavy equipment in, about or out of the Premises except in such a manner
and at such a time as Landlord shall in each instance authorize. Tenant shall
isolate and maintain all of Tenant's business machines and mechanical equipment
which cause or may cause air-borne or structure-born vibration or noise, whether
or not it may be transmitted to my other Premises so as to eliminate such
vibration or noise.

9.05  Electrical Equipment

      Tenant shall not, without prior written notice to Landlord in each
instance (i) connect to the Building electric distribution system anything other
this normal office equipment or (ii) operate such equipment on a regular basis
beyond normal Building operating hours. Tenant's
<PAGE>   23
                                      -23-

use of electrical energy in the Premises shall not at any time exceed the
capacity of any of the electrical conductors or equipment in or otherwise
serving the Premises. Tenant shall not, without prior written notice to Landlord
in each instance, connect to the Building electric distribution system any
fixtures, appliances or equipment which operate on a voltage in excess of 120
volts nominal or make any alteration or addition to the electric system of the
Premises.

9.06  Pay Taxes.

      Tenant shall pay promptly when due all Taxes upon personal property
(including without limitation, fixtures and equipment) in the Premises to
whomsoever assessed.

9.07  Tenant's Covenants.

      Tenant will not vacate, abandon or desert the Premises or cause the
Premises to be empty or unoccupied.

                                   ARTICLE 10
                        REQUIREMENTS OF PUBLIC AUTHORITY

10.01 Legal Requirements.

      Tenant shall, at its own cost and expense, promptly observe and comply
with all Legal Requirements. Tenant shall pay all costs, expenses, liabilities,
losses, damages, fines, penalties, claims and demands, that may in any manner
arise out of or be imposed because of the failure of Tenant to comply with the
covenants of this Article 10.

10.02 Contests.

      Tenant shall have the right to contest by appropriate legal proceedings
diligently conducted in good faith, in the name of the Tenant, or Landlord (if
legally required), or both (if legally required), without cost, expense,
liability or damage to Landlord, the validity or application of any Legal
Requirement and, if compliance with any of the terms of any such Legal
Requirement may legally be delayed pending the prosecution of any such
proceeding, Tenant may delay such compliance therewith until the final
determination of such proceedings

                                   ARTICLE 11
                             COVENANT AGAINST LIENS

11.01 Mechanics Liens.

      Landlord's right, title and interest in the Premises or the Land or the
Building shall not be subject to or liable for liens of mechanics or materialmen
for work done on behalf of Tenant in connection with improvements to the
Premises. Notwithstanding such restriction, if because of any act or omission of
Tenant, any mechanic's hen or other lien, charge or order for payment of money
shall be filed against any portion of the Premises or the Land or the Building
Tenant shall, at its own cost and expense, cause the same to be discharged of
record or bonded within thirty (30) days after the filing thereof.
<PAGE>   24
                                      -24-

11.02 Right to Discharge.

      Without otherwise limiting any other remedy of Landlord for default
hereunder, if Tenant shall fail to cause such liens to be discharged of record
or bonded within the aforesaid this (30) day period or to satisfy such lien
within (30) days after any judgement in favor of such lien holders from which no
further appeal might be taken then Landlord shall have the right to cause the
same to be discharged. All amounts paid by Landlord to cause such liens to be
discharged shall constitute Additional Rent.

                                   ARTICLE 12
                               ACCESS TO PREMISES

12.01 Access.

      Landlord or Landlord's agents and designers shall have the right, but not
the obligation, to enter upon the Premises at all reasonable times during
ordinary business hours to examine same and to exhibit the Premises to
prospective purchasers and Tenant's, but in the latter case only during the last
six (6) months of the Lease Term.

                                   ARTICLE 13
              ASSIGNMENT AND SUBLETTING: OCCUPANCY ARRANGEMENTS

13.01 Subletting and Assignment.

      Tenant shall not (either voluntarily or by operation of law) enter into a
Prohibited Occupancy Arrangement, and any Prohibited Occupancy Arrangement shall
be absolutely void and ineffective for any purpose. Tenant shall not enter into
any other Occupancy Arrangement, either voluntarily or by operation of law,
(other than with a Person who is Affiliate of Tenant for a period ending when,
as and If such Person ceases to be Affiliate of Tenant) without the prior
written consent of Landlord.

      If Tenant intends to enter into a Occupancy Arrangement which requires
Landlord's consent, Tenant shall so notify Landlord in writing stating the name
of (and a financial statement with respect to) the Person whom Tenant intends to
enter into such Arrangement, the exact terms of the Arrangement and a precise
description of the portion of the Premises intended to be subject thereto.
Within thirty (30) days of receipt of such writing Landlord shall either (i)
consent to such Occupancy Arrangement or (ii) terminate this Lease with respect
to so much of the Premises as is intended to be subject thereto.

      If the Landlord consents to such Occupancy Arrangement, Tenant shall (i)
enter into such Arrangement on the exact terms described to Landlord within
fourteen (14) days of Landlord's consent or comply again with their terms of
this Section and (ii) remain liable for the payment and performance of the terms
and covenants of this Lease. If Tenant enters into such an Arrangement, Tenant
shall pay to Landlord when received the excess, if any, of amounts received in
respect of such Occupancy Arrangement over the Rent.
<PAGE>   25
                                      -25-

      If Landlord terminates this Lease, all Rent due shall be adjusted as of
the day the Premises (or portion thereof) are redelivered to Landlord. Any
portion of the Premises so redelivered shall be in the condition specified in
Section 7.08 hereof.

                                   ARTICLE 14
                                    INDEMNITY

14.01 Tenant's Indemnity.

      To the fullest extent permitted by law, Tenant shall indemnify and save
Landlord harmless from and against any and all liability, damage, penalties or
judgements and from and against any claims, actions, proceedings and expenses
and costs in connection therewith, including reasonable counsel fees arising
from injury to person or property sustained by anyone in and about the leased
premises, by any act or omission of Tenant, or Tenant's officers, agents,
servants, employees, contractors, sublessees or invitees. Tenant shall, at is
own cost and expense, defend any and all suits or actions just or unjust) in
which Landlord may be impleaded with others upon any above mentioned matter,
claim or claims, except as may result from the acts as set forth in Section
14.02. All merchandise, furniture, fixtures and property of every kind, nature
and description of Tenant or Tenant's employees, agents, contractors, invitees,
visitors, or guests which may be in or upon the Premises, the Land or the
Building during the Lease Term shall be at the sole risk and hazard of Tenant,
and that if the whole or any part thereof shall be damage, whatsoever, other
this by the gross negligence or willful default of Landlord, no part of said
damage or loss shall be charged to or borne by Landlord.

14.02 Landlord's Liability.

      Except for its intentional acts or gross negligence or the intentional
acts or gross negligence of its officers, agents, servants, employees or
contractors, Landlord shall not be responsible or liable for any damage or
injury to any property, fixtures, buildings or improvements, or to any person or
persons, at any time in the Premises, including any damage or injury to Tenant
or to any of Tenant's officers, agents, servants, employees, Contractors,
invitees, customers or sublessee.

                                   ARTICLE 15
                                    INSURANCE

15.01 Liability Insurance.

      Tenant shall provide or cause to be provided at its expense, and keep in
force during the Lease Term, general comprehensive liability insurance in a good
and solvent insurance company or companies licensed to do business in the
Commonwealth of Massachusetts, selected by Tenant, and reasonably satisfactory
to Landlord, and in an amount reasonably required by Landlord but in any event
not less than One Million Dollars ($1,000,000.00) with respect to injury or
death to any one person and One Million Dollars ($1,000,000.) with respect to
injury or death to more than one person in any one accident or other occurrence
and One Million Dollars ($1,000,000.00) with respect to damages to property.
Such policy or policies shall include
<PAGE>   26
                                      -26-

Landlord as an additional insured and have deductibles of no more than
$5,000.00. Tenant agrees to deliver certificates of such insurance to Landlord
as of the date hereof and thereafter not less than ten (10) days prior to the
expiration of any such policy. Such insurance shall not be cancelable without
this (30) days' written notice to Landlord.

15.02 Casualty Insurance.

      Tenant shall cause its improvements to the Premises to be insured for the
benefit of Landlord and Tenant as their respective interests may appear, against
loss or damage by fire and customary extended coverage in an amount equal to (i)
the replacement value thereof, if insurance in such amount is available, or (ii)
the amount necessary to avoid the effect of coinsurance provisions of the
applicable policies. Certificates thereof shall be delivered to Landlord,
Landlord shall, at Tenant's cost and expense, cooperate fully with Tenant and
execute any and all consents and other instruments and take all other actions
necessary to obtain the largest possible recovery. Landlord shall not carry any
insurance concurrent in coverage and contributing in the event of loss with any
insurance required to be furnished by Tenant hereunder If the effect of such
separate insurance would be to reduce the protection or the payment to be made
under Tenant's insurance.

                                   ARTICLE 16
                              WAIVER OF SUBROGATION

16.01 Waiver of Subrogation.

      An insurance policies carried by either party covering the Premises,
including but not limited to contents, fire and casualty insurance, shall
expressly waive any right on the part of the insurer to make any claim against
the other party. The parties hereto agree that their policies will include such
waiver clause or endorsement.

16.02 Waiver of Rights.

      Landlord and Tenant each hereby waive all claims, causes of action and
rights of recovery against the other and their respective partners, agents,
officers and employees, for any damage to or destruction of persons, property or
business which shall occur on or about the Premises and shall result from any of
the perils insured under any and all policies of insurance maintained by
Landlord and Tenant, regardless of cause, including the negligence and
intentional wrong doing of either party and their respective agents, officers
and employees but only to the extent of recovery, if any under such policy or
policies of insurance; provided however, that this waiver shall be invalidated
by reason of this waiver.

                                   ARTICLE 17
                              DAMAGE OF DESTRUCTION

17.01 Substantial Damage.

      If the Building or any part thereof shall be damaged by fire or other
casualty to the extent that substantial alteration or reconstruction of the
Building shall, in Landlord's reasonable
<PAGE>   27
                                      -27-

opinion, be required (whether or not the Premises shall have been damaged) or if
as payable be used to retire the mortgage debt, Landlord may, at its option,
terminate this Lease by notifying Tenant in writing of such termination within
sixty (60) days after the date of such damage. If this Lease is so terminated,
Rent shall be abated as of the date of such damage.

17.02 Restoration.

      If Landlord does not terminate this Lease pursuant to Section 17.01,
Landlord shall, within seventy-five (75) days after receipt by Landlord of the
Proceeds payable in respect of such fire or other casualty, proceed with
reasonable diligence to repair and restore the Building (subject to Force
Majeure) to substantially the same condition in which it was immediately prior
to the occurrence of the casualty to the extent of Landlord's Work and the value
of Landlord's Contribution. Landlord shall not be required to rebuild, repair,
or replace any part of Tenant's furniture, furnishings or fixtures or equipment
Landlord shall not be liable for any inconvenience or annoyance to Tenant or to
the business of Tenant resulting in any way from such damage or the repair
thereof, except that, Landlord shall allow Tenant a fair diminution of Rent
during the time and to the extent the Premises are unfit for occupancy.

                                   ARTICLE 18
                                 EMINENT DOMAIN

18.01 Total Taking.

      If the Premises or the Building should be the subject of a Total Taking,
then this Lease shall terminate as of the date when physical possession of the
Building or the Premises is taken by the condemning authority.

18.02       Partial Taking.

      If there occurs a Partial Taking Landlord (whether or not the Premises are
affected thereby) may terminate this Lease by giving written notice thereof to
Tenant within sixty (60) days after the right of election accrues, in which
event this Lease shall terminate as of the date the Building or Premises is
taken by the condemning authority. If upon such Partial Taking this Lease is not
terminated, Rent shall be abated by an amount representing that part of the Rent
properly be allocable to the portion of the Premises so taken and Landlord
shall, at Landlord's sole expense, restore and reconstruct the Building and the
Premises to substantially their former condition to the extent that the same, in
Landlord's judgement, may be feasible, but such work shall not exceed the scope
of Landlord's Work and the value of Landlord's Contribution. The Landlord shall
have no liability for interruption of Tenant's business.

18.03.      Awards and Proceeds.

      All Proceeds payable in respect of Taking shall be the property of
Landlord. Tenant hereby assigns to Landlord all rights of Tenant in or to such
Proceeds, provided that Tenant shall be entitled to separately petition the
condemning authority for a separate award for its moving expenses and trade
fixtures out only if such a separate award will not diminish the amount of
Proceeds payable to Landlord.
<PAGE>   28
                                      -28-

                                   ARTICLE 19
                                 QUIET ENJOYMENT

19.01 Landlord's Covenant.

      Provided that an Event of Default has not occurred and is not then
continuing, Tenant shall, subject to the Permitted Exceptions, quietly have and
enjoy the Premises during the Lease Term, without hindrance or molestation from
any Person lawfully claiming by, through or under Landlord.

19.02 Subordination.

      This Lease is and shall be subject and subordinate to any mortgage now or
hereafter on the Building and to each advance made or hereafter to be made under
any mortgage, and to all renewals, modifications, consolidations, replacements
and extensions thereof and all substitutions therefore. This Section 19.02 shall
be self-operative and no further instrument of subordination shall be required.
In confirmation of such subordination, Tenant shall execute and deliver promptly
any certificate that Landlord or any mortgagee may request In the event that any
mortgagee shall succeed to the interest of Landlord then this Lease shall
terminate, or, at the option of such mortgagee, this Lease shall nevertheless
continue m full force and effect and Tenant shall and does hereby agree to
attorn to such mortgagee and to recognize such mortgagee as its Landlord.

19.03 Notice to Mortgagee.

      No act or failure to act on the part of Landlord which would entitle
Tenant under the terms of this Lease, or by law, to be relieved of Tenant's
obligations hereunder or to terminate this Lease, shall result in a release or
termination or such obligations or a termination of this Lease unless (i) Tenant
shall have first given written notice of Landlord's act or failure to act to
Landlord's mortgagees of record, if any, specifying the act or failure to act on
the part of Landlord which could or would give basis to Tenant's rights; and
(ii) such mortgagees,. after receipt of such notice, have had the opportunity to
cure such default within a reasonable time thereafter; but nothing contained in
this Section 19.03 shall be deemed to impose any obligation on any such
mortgagees to correct or cure any such condition. "Reasonable time" as used
above shall mean a period of not less than thirty (30) Business Days and shall
include (but not be limited to) a reasonable time to obtain possession of the
Building if the mortgagee elects to do so and a reasonable time to correct or
cure the condition if such condition is determined to exist.

19.04 Other Provisions Regarding Mortgagees.

      If this Lease or the Rent due hereunder is assigned to a mortgagee as
collateral security for a loan, no such mortgagee shall be deemed to have
assumed any of Landlord's obligations hereunder solely as a result of said
assignment A mortgagee to whom this Lease has been so assigned shall be deemed
to have assumed such obligations only if (i) by the terms of the instrument of
assignment such mortgagee specifically elects to assume such obligations or (ii)
such mortgagee has (a) foreclosed its mortgage, (b) accepted a deed in lieu
thereof, or (c) taken
<PAGE>   29
                                      -29-

possession of the Premises by entry or otherwise. Even if such mortgagee assumes
the obligations of Landlord hereunder, (i) any such obligation under Section
24.01 to return the Security Deposit to the Tenant shall be limited to the
amount actually received by the mortgagee with respect thereto, and (ii) such
mortgagee will be liable for breaches of any Landlord's obligations hereunder
only to the extent such breaches occur during the period of ownership by the
mortgagee after foreclosure (or any conveyance by a deed in lieu thereof, all as
set forth in Section 25.10. hereof. Tenant may from time to time, at mortgagees
request, be required to provide mortgagee with certain financial information
pertaining to the Tenant as mortgagee may reasonably request.

                                   ARTICLE 20
                           DEFAULTS; EVENTS OF DEFAULT

20.01 Defaults.

      The following shall, If any requirement for notice or lapse of time or
both has not been met, constitute Defaults, and, if such requirements for notice
or lapse of time have been met, constitute Events of Default hereunder:

1.    Occurrence of any event set forth in Article 21 hereof;

2.    The failure of Tenant to pay Rent when the same shall be due and payable
      and the continuance of such failure for a period of ten (10) days after
      receipt by Tenant of notice in writing from Landlord specifying such
      failure;

3.    The failure of Tenant to observe any covenant made by it in Sections
      13.01, 15.01 and 25.03 hereof and;

4.    The failure of Tenant to keep, observe or perform any of the other
      covenants, conditions and agreements herein contained on Tenant's part to
      be kept, observed or performed and the continuance of such failure without
      the curing of same for a period of twenty (20) days after receipt by
      Tenant of notice in writing from Landlord specifying in reasonable detail
      the nature of such failure.

20.02 Tenant's Best Efforts.

      In the event that the Default of which Landlord gives notice is of such a
nature that it cannot be cured within such twenty (20) day period, then such
Default shall not be deemed to be an Event of Default so long as Tenant, after
receiving such notice, proceeds to cure the Default as soon as reasonably
possible and continues to take all steps necessary to complete the same within a
period of time which, under all prevailing circumstances, shall be reasonable.
No Default shall be deemed to be an Event of Default if and so long as Tenant
shall be so proceeding to cure the same in good faith or be delayed in or
prevented from curing the same by reason of Force Majeure.
<PAGE>   30
                                      -30-

20.03 Elimination of Default.

      Notwithstanding anything to the contrary contained in this Article 20, in
the event that hereinabove provided, such Default's) shall be deemed never to
have occurred and Tenant's rights hereunder shall continue unaffected by such
Defaults.

20.04 Tenant's Default - Rent Abatement Cancellation.

      If an Event of Default occurs at any time during the term of this Lease,
Landlord shall have the option of retracting the full rent abatement and Tenant
shall pay the full abated amount immediately to Landlord upon demand.

                                   ARTICLE 21
                                   INSOLVENCY

21.01 Insolvency.

      If (1) there occurs with respect to Tenant an Insolvency or (2) any
execution or attachment is issued against Tenant or any of its property and as a
result thereof the Premises are taken or occupied by some Person other than the
Tenant, except as may herein be permitted, then an Event of Default hereunder
shall be deemed to have occurred so that the provisions of Article 22 hereof
shall become effective and Landlord shall have the rights and remedies provided
for therein.

                                   ARTICLE 22
                   LANDLORD'S REMEDIES; DAMAGES ON DEFAULT

22.01 Landlord's Remedies.

      If an Event of Default shall occur and be continuing, Landlord may, at its
option, give to Tenant a notice terminating this Lease upon a date specified in
such notice, which date shall be not less than three (3) Business Days after the
date of receipt by Tenant of such notice from Landlord, and upon the date
specified in said notice, the term and estate hereby vested in Tenant shall
cease and any and all other right, title and interest of Tenant hereunder shall
likewise cease without further notice or lapse of time, as fully and with like
effect as if the entire Lease Term had elapsed, but Tenant shall continue to be
liable to Landlord as hereinafter provided.

      If such Event of Default results from Tenant's failure to pay Tenant's
Cost as required by Section 7.01 hereof and the Work Letter, Landlord may, at
its option, in addition to or in lieu of the other remedies available to
Landlord, refuse Tenant access to the Premises. In such event the Term
Commencement Date shall be the earlier of (i) the date determined in accordance
with Section 7.04 or (ii) the Substantial Completion Date.

      If such Event of Default results from Tenant's failure to pay a charge for
an Additional Service pursuant to Section 8.03 hereof, Landlord may, without
further notice to Tenant, discontinue any or all of such Additional Services.
<PAGE>   31
                                      -31-

      If an Event of Default shall occur and be continuing Landlord shall be
relieved of its undertakings under Article 13 hereof.

22.02 Surrender.

      Upon any termination of this Lease as the result of an Event of Default,
Tenant shall quit and peacefully surrender the Premises to Landlord, upon or at
any time after any such termination, Landlord may without further notice enter
the Premises and possess itself thereof by summary proceedings or otherwise, any
may dispossess Tenant and remove Tenant and all other Persons and property from
the Persons and may have, hold and enjoy the Premises and the right. to receive
all rental income of and from the same.

22.03 Right to Relet.

      At any time from time to time after any such termination, Landlord may
relet the Premises or any part thereof, in the name of Landlord or otherwise,
for such terms or terms (which may be greater or less this the period which
would otherwise have constituted the balance of the Lease Term) and on such
conditions (which may include concessions or free rent) as Landlord, in its
reasonable discretion, may determine and may collect and receive the rents
therefor. Landlord shall in no way be responsible or liable for any failure to
relet the Premises or any part thereof, or for any failure to correct any rent
due upon any such reletting.

22.04 Survival of Covenants.

      No such termination of this 1XLease shall relieve Tenant of its liability
and obligations under this Lease and such liability and obligations shall
survive any such termination. Tenant shall indemnify and hold Landlord harmless
from all loss, cost, expense, damage or liability arising out or in connection
with such termination.

      In the event of any such termination, Tenant shall pay to the Landlord the
Rent up to the date of such termination. Tenant shall also pay to Landlord, on
demand, as and for liquidated and agreed damages for Tenant's Default, the
difference between

      (1) the aggregate Rent which would have been payable under this Lease by
Tenant from the date of such termination until the Stated Expiration Date, less

      (2) the fair and reasonable rental value of the Premises for the same
period, excluding all of Landlord's reasonable estimate of expenses to be
incurred in connection with reletting the Premises, including, without
limitation all repossess costs, brokerage commission, legal expenses, reasonable
attorney's fees, alteration costs, and expenses of preparation for such
reletting.

      If the Premises or any part thereof are relet by the Landlord before
presentation of proof of such liquidated damages to any court, commission or
tribunal, the amount of rent reserved upon such reletting shall be, prima facie,
the fair and reasonable rental value for the part or the whole of the Premises
so relet during the term of the reletting.

<PAGE>   32
                                      -32-

      Nothing herein contained shall limit or prejudice the right of the
Landlord to prove and obtain as liquidated damages by reason of such
termination, an amount equal to the maximum allowed by any statute of rule of
law in effect at the time when, and governing the proceedings in which, such
damages are to be proved, whether or not such amount be greater, equal to, or
less than the amount of the difference referred to above.

22.05 Right to Equitable Relief.

      If there shall occur a Default or threatened Default, Landlord shall be
entitled to enjoin such Default or threatened Default and shall have the right
to invoke any right and remedy allowed at law or in equity or by statute or
otherwise as though reentry, summary proceedings, and other remedies were not
provided for in this Lease.

22.06 Right to Self Help; Interest on Overdue Rent.

      If an Event of Default shall occur and be continuing, Landlord shall have
the right, but shall not be obligated, to enter upon the Premises and to perform
such obligation notwithstanding the fact that no specific provision for such
substituted performance by Landlord is made in this Lease with respect to such
Default In performing such obligation, Landlord may make any payment of money or
perform any other act The aggregate of (i) all sums so paid by Landlord, (ii)
interest (at the rate of 1 1/2% per month or the highest rate permitted by law,
whichever is less) on such sum plus all Rent not paid when due and (iii) all
necessary incidental costs and expenses in connection with the performance of
any such act by Landlord, shall be deemed to be Rent under this Lease and shall
be payable to Landlord immediately upon demand. Landlord may exercise the
foregoing rights without waiving any other of its rights or releasing Tenant
from any of its obligations under this Lease.

22.07 Further Remedies.

      Upon any termination of this Lease pursuant to Section 22.01, or at any
time thereafter, Landlord may, in addition to and without prejudice to any other
rights and remedies Landlord shall have at law or in equity, re-enter the
Premises, and recover possession thereof and may dispossess any or all occupants
of the Premises in the manner prescribed by the statute relating to summary
proceedings, or similar statute(s); but Tenant in such case shall remain liable
to Landlord as hereinbefore provided.

                                   ARTICLE 23
                                     WAIVERS

23.01 No Waivers.

      Failure of Landlord to complain of any act or omission on the part of
Tenant no matter how long the same may continue, shall not be deemed to be a
waiver by said Landlord of any of its rights hereunder. No waiver by any
provision of Lease shall be deemed a waiver of a breach of the same or any other
provision. No acceptance by Landlord of any partial payment shall constitute an
accord or satisfaction but shall only be deemed A partial payment on account
<PAGE>   33
                                      -33-

                                   ARTICLE 24
                                SECURITY DEPOSIT

24.01 Security Deposit.

      Tenant has deposited the Security Deposit with Landlord. Landlord shall
hold the Security Deposit as security for the full and fair payment or
performance by Tenant of its obligations under this Lease and not as a
prepayment of Rent Landlord may commingle the Security Deposit with other funds
of Landlord but shall not be liable to Tenant for the payment of interest
thereon or profits therefrom. Landlord may expend such amounts from the Security
Deposit, including legal fees, as may be necessary to cure any Default and, in
such case, Tenant shall pay to landlord the amount so expended, on demand.
Landlord may assign the Security Deposit to any subsequent owner of the Building
and thereafter Landlord shall have no further liability to Tenant with respect
thereto. As soon as reasonably practicable after the Lease Termination Date,
Landlord shall (i) inspect the Premises, (ii) make such payments from the
Security Deposit as may be required to cure any outstanding Events of Default
hereunder and (iii) if no Event of Default is then continuing, pay the balance
of the Security Deposit to T

                                   ARTICLE 25
                               GENERAL PROVISIONS

25.01 Force Majeure.

      In the event that Landlord or Tenant shall be delayed, hindered in or
prevented from the performance of any act required hereunder by reason of Force
Majeure, then performance of such act shall be excused for the period of the
delay and the period for the performance of any such act shall be extended for a
period equivalent to the period of such delay.

25.02 Notices and Communications.

      All notices, demands, requests and other communications provided for or
permitted under Lease shall be in writing, either delivered by hand or sent by
certified mail, postage prepaid, to the following address:

      (a)     if to Landlord at the address stated in Section 1.01 hereof, or at
              such other address as the Landlord shall have designated in
              writing to the Tenant, with a copy to such Persons as Landlord
              shall have designated in writing to Tenant, or

      (b)     if to Tenant at the address stated in Section 1.01 hereof, or at
              such other address as the Tenant shall have designated in writing
              to the Landlord, with a copy to such Persons as Tenant shall have
              designated in writing to Landlord.

      Any notice provided for herein shall become effective only upon and at the
time of receipt by the Person to whom it is given, unless such notice is mailed
by first-class registered or
<PAGE>   34
                                      -34-

certified mail, in which case it shall be deemed to be received on (i) the third
Business Day following the mailing thereof or (ii) the day of its receipt, if a
Business Day, or the next succeeding Business Day, whichever of (i) or (ii)
shall be the earlier.

25.03 Certificates, Estoppel Letter.

      Either party shall, without charge, at any time and from time to time
hereafter, within ten (10) days after written request of the other, certify by
written instrument duly executed and acknowledged to any mortgagee or purchaser,
or proposed mortgagee or proposed purchaser, or any Person specified in such
request; (a) as to whether this Lease has been supplemented or amended, and if
so, the substance and manner of such supplement or amendment, (b) as to the
validity and force constituted, (c) as to the existence of any Default or Event
of Default, (d) as to the existence of any offsets, counterclaims or defenses
thereto on the part of such other party, (e) as to the Term Commencement Date
and Stated Expiration Date, and (f) as to any other matters as may reasonably be
so requested. Any such certificate may be relied upon by the party requesting it
and any other Person to whom the same may be exhibited or delivered, and the
contents of such certificate shall be binding on the party executing same.

      Tenant shall in addition, within 5 Business Days of the Term Commencement
Date, execute and deliver to Landlord a tenant estoppel letter substantially in
the form attached hereto as Exhibit 1.

25.04 Renewal.

      If this Lease is renewed or extended the provisions of Sections 7.01,
7.02, 7.03, 7.04, and 7.05 of Article 7 hereof shall not apply.

25.05 Governing Law.

     This Lease and the performance thereof shall be governed, interpreted,
construed and regulated by the laws of the Commonwealth of Massachusetts.

25.06 Partial Invalidity.

     If any term, covenant, condition or provision of this Lease or the
application thereof to any person or circumstance shall, at any time or to any
extent, be invalid or unenforceable, the remainder of this Lease, or the
application of such term or provision to persons or circumstances other than
those as to which is held invalid or unenforceable, shall not be affected
thereby, and each term, covenant, condition and provision of this Lease shall be
valid and be enforced to the fullest extent permitted by law.

25.07 Notice of Lease.

     The parties will at any time, at the request of either one, promptly
execute duplicate originals of an instrument, in recordable form, which will
constitute a Notice of Lease, setting
<PAGE>   35
                                      -35-

forth a description of the Premises, the Lease Term and any other portions
thereof, excepting the rental provisions, as either party may request Cost of
review and recording to be borne by Tenant.

25.08 Interpretation; Consents.

     The section headings used herein are for reference and convenience only,
and shall not enter into the interpretation hereof. This Lease may be executed
in several counterparts, each of which shall be an original, but all of which
shall constitute one and the same instrument The term "Landlord" whenever used
herein, shall mean only the owner at the time of Landlord's interest here and
shall upon any sale or assignment (other than as collateral security for a loan)
of the interest of Landlord herein, its respective successors in interest and/or
assigns shall, during the term of ownership of its respective estates herein, be
deemed to be Landlord and the liability of Landlord, if any, hereunder shall in
any event be limited to the Landlord's interest in the Building.

      Subjects to the provisions of the third sentence of Section 7.06 and
except for the consents of Landlord required pursuant to the second sentence of
Section 7.06 and Article 13 hereof, consents or approvals required or requested
of either Landlord or Tenant shall not be unreasonably withheld or delayed.

25.09 Parties.

     Except as herein otherwise expressly provided, the covenants, conditions
and agreements contained in this Lease shall be binding upon the heirs,
successors and assigns of the parties hereto.

25.10 Waiver of Trial by Jury.

      Landlord and Tenant do hereby waive trial by jury in any action,
proceeding or counterclaim brought by either against the other upon any matters
whatsoever arising out of or in any way connected with this Lease, Tenant's use
or occupancy of the Premises and/or claim of injury or damage.

                                   ARTICLE 26
                                  MISCELLANEOUS

26.01 Expansion Space.

      Landlord shall use its best efforts to provide Tenant with expansion space
in the facility or one in the local area at the request of Tenant
<PAGE>   36
                                      -36-

26.02 Exterior Landscaping.

      Landlord shall use its best efforts to landscape the entrance to suite 150
and parking area prior to Tenant's rent commencement date. Landlord shall
landscape twenty (20) feet from the front of Tenant's main entrance using its
own design criteria.

26.03 Holdover Clause.

      In the event Tenant fails to vacate the Premises by the Lease Termination
Date, Tenant hereby agrees to pay Landlord two (2) times the monthly rental
rate. The "Holdover Rental Rate" shall be paid monthly in advance to Landlord.
In determining the "Holdover Rental Rate" Landlord shall charge two (2) the
gross monthly for the last full calendar month under the lease.

26.04 Exterior Signage.

      Landlord shall supply and install exterior directories in the parking lot
indicating Tenant entrance locations.

                                   ARTICLE 27
                                ENTIRE AGREEMENT

27.01 Entire Agreement.

      No oral statement or prior written matter shall have any force or effect.
This Agreement shall not be modified or canceled except by written subscribed to
all parties.

      No Representations, inducement, promises or agreements, oral or otherwise,
between Landlord and Tenant or any of their respective brokers, employees or
agents, not embodied herein, shall be of any force or effect.

Executed as a sealed instrument as of the _________day of _____________ 1997.

201 Forest Street Realty Trust            Synchronicity, Inc.

By:_________________________________      By   ________________________________
   David P. Depietri                           Eugene Connolly
Its:  Trustee                             Its: Vice President of Operations
<PAGE>   37
                                      -37-

                                      INDEX
                                    EXHIBITS

Exhibit B:       PLAN SHOWING TENANT'S SPACE

Exhibit C:       SERVICES BY LANDLORD

Exhibit D:       RULES AND REGULATIONS
<PAGE>   38
                                      -38-

                                    EXHIBIT B
                          (PLAN SHOWING TENANTS SPACE)
<PAGE>   39
                                      -39-

                                    EXHIBIT C

                       SERVICES TO BE PROVIDED BY LANDLORD
                             (AS OPERATING EXPENSES)

A.    Replacement of fluorescent tubes and starters in overhead parabolic light
      fixtures as needed.

B.    Hot and cold water for lavatory and drinking purposes.

C.    Toilet supplies including soap, paper or cloth towels, and toilet tissue
      for lavatories.

D.    Janitor services in accordance with the following schedule and to be
      accomplished unless otherwise indicated, five nights per week after
      Tenants normal working hours:

Entrance Doors:   Entrance glass will be cleaned five times per week.

Entrance Floor:   Entrance floor will be polished five times per week.

Broadloom:        All carpeted areas will be vacuumed three times per week.
                  Broadloom will be shampooed upon request, at an additional
                  cost to Tenant.

Wastepaper
Containers:       Wastepaper containers will be emptied five times per week;
                  plastic liner bags will be provided for wastepaper
                  containers; liners will be changed once a week.

Water Fountains:  All water fountains will be sanitized and polished five
                  times per week.

Washrooms:        Washrooms will be cleaned and serviced five times per
                  week.  This will include refilling all paper towel, toilet
                  tissue, and soap dispensers, cleaning all towel and trash
                  containers, cleaning and polishing all stainless steel
                  fixtures, cleaning toilets, washing and sanitizing all wash
                  basins and shelves, cleaning and polishing all mirrors,
                  removing all disfigurations such as ink marks, drawings,
                  etc., from all partitions and walls, damp mopping of floors.

Scuff Marks:      All scuff marks will be removed five times per week from
                  all scuff plates on doors.

Tile Floors:      All floors will be swept five times per week.  All corridors
                  and office floors will be polished five times per week.
                  Floors 14Xwill be stripped whenever necessary.

Cafeteria:        Table and counters will be cleaned five times per week.
<PAGE>   40
                                      -40-

E.    Proper care of grounds surrounding the Building, including care of lawns
      and shrubs and including removal of litter.

F.    Maintaining and cleaning the sidewalks and parking areas in front of and
      around the Building including snow removal.

G.    Provision of adequate lighting for the parking areas servicing the
      Building.

H.    Exterior windows will be washed annually as a common area expense.

1.    Rooftop HVAC (Heating, Ventilation, and Air-Conditioning) will be provided
      to Tenant at Landlord's expense during normal business hours. All of
      Tenants secondary HVAC systems and any special interior requirements shall
      be at Tenant's expense.
<PAGE>   41
                                      -41-

                                    EXHIBIT D

                              RULES AND REGULATIONS

1.    Heating, lighting and plumbing: The Landlord should be notified at once of
      any trouble with heating, lighting or plumbing fixtures. Tenants must not
      leave the doors of the Premises unlocked at night.

2.    The sidewalks, entrances, halls and stairways shall not be obstructed by
      any Tenant or used for any purposes other than ingress and egress to and
      from their respective Premises, and no articles or rubbish shall be left
      herein.

3.    No toilet fixture shall be used for any purpose other than that for which
      it is intended, and now sweepings, rubbish, rags, ashes or other
      substances shall be thrown herein.

4.    The weight and position of all safes and heavy equipment or machines shall
      be subject to the approval of the Landlord.

5.    Lettering on doors, tablets and building directory shall be subject to the
      approval of the Landlord; no lettering shall be allowed on outside
      windows.

6.    No wires for telephone service, electric lights, messenger service or for
      any other purpose shall be put in the Premises without the consent of the
      Landlord.

7.    No glass in doors or elsewhere through which light is admitted in to any
      part of the building shall be obstructed.

8.    No animals or birds shall be kept in or about the Building.

9.    All freight, furniture, etc. must be received and delivered through
      entrances to the Building designated for such purpose unless otherwise
      authorized by the Landlord.

10.   Nothing shall be thrown from or taken in through the windows, nor shall
      any be left outside the Building on the window sills of the Premises.

11.   No person shall loiter in the halls, corridors, or lavatories.

12.   The Landlord, its agents and employees shall have access at reasonable
      times to perform their duties in the maintenance and operation of the
      Premises.

13.   No Tenant shall use any method of heating other that provided for in the
      Tenant's Lease without the consent of the Landlord.
<PAGE>   42
                                      -42-

14.   Any damage caused to the Building or the Premises or to any person or
      property herein as a result of any breach of any of the rules and
      regulations by the Tenant shall be borne by the Tenant.

15.   The Landlord reserves the right to make any such other and further rules
      and regulations as, in its judgement, may from time to time be necessary
      for maintaining the safety and cleanliness of the Premises and Building
      for the preservation of good order therein.

16.   All office areas shall require floor mats under any chairs that have
      casters, so that the carpet shall remain in good order and repair.

                             SECOND LEASE AMENDMENT

      This Second Lease Amendment ("Second Amendment") is made this___________
day of _______________,1999 by and between 201 Forest Street Realty Trust, with
a mailing address c/o Rosewood Development Corporation, 293 Boston Post Road
West, Suite 320, Marlborough, Massachusetts, 01752 (hereafter referred to as
"Landlord") and Synchronicity, Inc., a Massachusetts Corporation, with a
principal place of business at 201 Forest Street, Marlborough, Massachusetts
01752 (hereinafter referred to as "Tenant").

                                   WITNESSETH

WHEREAS, Landlord and Tenant have entered into a certain lease dated April 1,
1997 which was amended pursuant to a First Lease Amendment dated June 30, 1997,
(hereinafter collectively referred to as the "Lease") wherein Landlord leased to
Tenant and Tenant leased from Landlord certain premises consisting of 4,331
rentable square feet (the "original Premises") located on the third floor of the
building located at 201 Forest Street, Marlborough, Massachusetts (the
"Building").

WHEREAS, Tenant wishes to lease from Landlord and Landlord wishes to lease to
Tenant additional space located on the third floor of the Building upon the
terms and conditions hereinafter set forth.

NOW THEREFORE, for good and valuable consideration the receipt and sufficiency
of which is hereby acknowledged, Landlord and Tenant hereby agree as follows:

1. Landlord and Tenant hereby incorporate all tenants and provisions of the
Lease herein as is specifically set forth, except as said terms are modified
herein. Capitalized terms not specifically defined in this Second Amendment
shall have the same meaning ascribed to them in the Lease.

2. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord
approximately 4,928 square feet of rentable floor area (hereinafter referred to
as the "Expansion Space located on the third floor of the Building for a term
commencing November 1, 1999 and continuing
<PAGE>   43
                                      -43-

through (and including) October 31, 2004. Expansion Space is hereby agreed to be
that certain space which is shown cross-hatched on Exhibit A attached hereto and
Landlord's Work is hereby agreed to be set forth on Exhibit B attached hereto
and made a part hereof.

3.    Effective as of the Expansion Space Commencement Date, the Rentable Area
      of Premises shall be increased by 4,928 rentable square feet (RSF) (the
      "Expansion Space") to a total of 9,259 RSF of office space.

4.    Effective as of the Expansion Space Commencement Date, Section 1.01 OF
      LEASE AGREEMENT.

        a.  Delete:
                    "RENTABLE AREA OF PREMISES:                       4,331."

        b.  Insert:
                    "RENTABLE AREA OF PREMISES:                       9,259."

5.   Section 1.01 OF LEASE AGREEMENT

      a.    Delete:
                    "TERM:               Five (5) years."

      b.     Insert:
                    "TERM:               Seven (7) years four (4) months.
                                         July 1, 1997 to October 31, 2004"

6.    Section 1.01 OF LEASE AGREEMENT

      a.    Delete:
                    "BASIC RENT:         Delete section and all amendments
                                         thereto in their entirety."

      b.    Insert:
                    "BASIC RENT:         See schedule below:

<TABLE>
<CAPTION>
                     SQUARE   NET, NET, NET     NET, NET, NET    NET, NET, NET
 PERIOD               FEET      RATE/RSF         ANNUAL RENT      MONTHLY RENT
 ------              ------   -------------     -------------    -------------

<S>                  <C>      <C>               <C>              <C>
7/l/97   10/31/99    4,331       $13.50           $58,468.50      $4,872.37
II/l/99  10/31/04    9,259       $13.50           $124,996.50     $10,416.38"
</TABLE>

7. Effective as of the Expansion Lease Commencement Date, Section 1.01 OF LEASE
AGREEMENT
<PAGE>   44
                                      -44-

      a.    Delete:
                    "TENANT'S SHARE:     10.8%"

      b.    Insert:
                    "TENANT'S SHARE:     24.37%"

In all other respects the Lease is hereby ratified, confirmed, and approved.

IN WITNESS WHEREOF, Landlord and Tenant have duly executed the Second Lease
Amendment under seal as of the ___________day of September, 1999.

LANDLORD:       201 FOREST STREET REALTY TRUST

                __________________________________________
                By:  David P. Depietri
                Its:    Trustee

TENANT:         Synchronicity, Inc.

                __________________________________________
                By:  Eugene Connolly
                Its:    Vice President of Operations<PAGE>   1
                                                                   Exhibit 10.12

                                                        [OFFICE FORM CALIFORNIA]

                                 LEASE AGREEMENT
                                     BETWEEN
                     W9/PHC REAL ESTATE LIMITED PARTNERSHIP,
                         A DELAWARE LIMITED PARTNERSHIP

                                   AS LANDLORD

                                       AND

                              SYNCHRONICITY, INC.,
                           A MASSACHUSETTS CORPORATION

                                    AS TENANT

                             DATED NOVEMBER 18, 1998

                                    PROPERTY:

                           160 WEST SANTA CLARA STREET
                           SAN JOSE, CALIFORNIA 95113

                                                               DECEMBER 14, 1998

<PAGE>   2

                             BASIC LEASE INFORMATION

LEASE DATE:                             November 18, 1998

TENANT:                                 SYNCHRONICITY, INC., a Massachusetts
                                        corporation

LANDLORD:                               W9/PHC REAL ESTATE LIMITED PARTNERSHIP,
                                        a Delaware limited partnership

PREMISES:                               Suite No. 1300 in the office building
                                        commonly known as 160 West Santa Clara
                                        Street (the "BUILDING"), and whose
                                        street address is 160 West Santa Clara
                                        Street, San Jose, California, 95113. The
                                        Premises are outlined on the plan
                                        attached to the Lease as Exhibit A. The
                                        land on which the Building is located
                                        (the "LAND") is described on Exhibit B.
                                        The term "Building" includes the related
                                        land, driveways, parking - facilities,
                                        and similar improvements.

TERM:                                   Approximately sixty (60) months,
                                        commencing on January 1, 1999 (the
                                        "COMMENCEMENT DATE") and ending at 5:00
                                        p.m. on the last day of the sixtieth
                                        full calendar month following the
                                        Commencement Date (the "TERM" which
                                        definition shall include all renewals of
                                        the initial term), subject to adjustment
                                        and earlier termination as provided in
                                        the Lease.

OPTION:                                 One (1) option for forty-eight (48)
                                        months

BASIC RENT:                             Basic Rent shall be the following
                                        amounts for the following periods of
                                        time:

                                        LEASE MONTH           MONTHLY BASIC RENT

                                        Months 1-12           $20,138.10
                                        Months 13-24          $20,915.36
                                        Months 25-36          $21,763.28
                                        Months 37-48          $22,681.86
                                        Months 49-60          $23,529.78

                                        As used herein, the term "LEASE MONTH"
                                        shall mean each calendar month during
                                        the Term (and if the Commencement Date
                                        does not occur on the first day of a
                                        calendar month, the period from the
                                        Commencement Date to the first day of
                                        the next calendar month shall be
                                        included in the first Lease Month for
                                        purposes of determining the

                                       -i-
<PAGE>   3

                                        duration of the Term and the monthly
                                        Basic Rent rate applicable for such
                                        partial month).

SECURITY DEPOSIT:                       $23,529.78, plus a letter of credit in
                                        the amount of $70,590.00.

RENT:                                   Basic Rent, Tenant's Proportionate Share
                                        of Taxes, Tenant's share of Additional
                                        Rent, and all other sums that Tenant may
                                        owe to Landlord or otherwise be required
                                        to pay under the Lease.

PERMITTED USE:                          Sales, marketing, and general office
                                        use.

TENANT'S PROPORTIONATE SHARE:           3.34%, which is the percentage obtained
                                        by dividing the 7,066 rentable square
                                        feet in the Premises by the 211,757
                                        rentable square feet in the Building.
                                        Landlord and Tenant stipulate that the
                                        number of rentable square feet in the
                                        Premises and in the Building set forth
                                        above shall be binding upon them.

EXPENSE STOP:                           Actual Operating Costs for calendar year
                                        1999

BASE YEAR:                              1999

INITIAL LIABILITY INSURANCE AMOUNT:     $3,000,000.00

MAXIMUM CONSTRUCTION ALLOWANCE:         $5.00 per rentable square foot.

GUARANTOR:                              None

TENANT'S ADDRESS:

         Following Commencement Date:

         Synchronicity, Inc.
         160 West Santa Clara Street, Suite 1300
         San Jose, California 95113
         Attn: ________________________
         Facsimile: ____________________

                                      -ii-
<PAGE>   4

Landlord's Address:

  For All Notices:

  W9/PHC Real Estate Limited Partnership
  c/o Archon Group
  Two California Plaza
  350 South Grand Avenue, 46th Floor
  Los Angeles, California 90071
  Attn:  Nancy M. Haag
  Facsimile: (213) 633-5870

  For Rent Payments:

  Insignia/ESG
  160 West Santa Clara Street, Suite 550
  San Jose, California 95113
  Attn:  Vicki Herl

With A Copy To:

Insignia/ESG
160 West Santa Clara Street, Suite 550
San Jose, California 95113
Attn: Vicki Herl
Facsimile: (408) 971-9880

                                     -iii-

<PAGE>   5

THE FOREGOING BASIC LEASE INFORMATION IS INCORPORATED INTO AND MADE A PART OF
THE LEASE IDENTIFIED ABOVE. IF ANY CONFLICT EXISTS BETWEEN ANY BASIC LEASE
INFORMATION AND THE LEASE, THEN THE LEASE SHALL CONTROL.

LANDLORD:                               W9/PHC REAL ESTATE LIMITED PARTNERSHIP,
                                        a Delaware limited partnership

                                        By:  W9/PHC GENPAR, INC., a Delaware
                                             corporation, its general partner

                                        By: _______________________________
                                        Name:  Howard Stern
                                        Title:  Assistant Vice President

TENANT:                                 SYNCHRONICITY, INC., a
                                        Massachusetts corporation

                                        By: _______________________________
                                        Name: ____________________________
                                        Title: _____________________________

                                        By: _______________________________
                                        Name: ____________________________
                                        Title: _____________________________

                                      -iv-
<PAGE>   6

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                           PAGE
<S>                                                                        <C>
BASIC LEASE INFORMATION ...............................................      i
1.   Definitions And Basic Provisions .................................      1
2.   Lease Grant ......................................................      1
3.   Term .............................................................      1
4.   Rent .............................................................      1
   4.1        Payment .................................................      1
   4.2        Operating Costs; Taxes ..................................      2

5.   Delinquent Payment,Handling Charges ..............................      3
6.   Security Deposit .................................................      4
   6.1        Security Deposit ........................................      4
   6.2        Letter Of Credit ........................................      4

7.   Landlord's Obligations ...........................................      5
   7.1        Services ................................................      5
   7.2        Excess Utilities ........................................      5
   7.3        Restoration of Services; Abatement ......................      6
8.   Improvements; Alterations; Repairs; Maintenance ..................      6
   8.1        Improvements,Alterations ................................      6
   8.2        Repairs; Maintenance ....................................      6
   8.3        Performance of Work .....................................      7
   8.4        Mechanic's Liens ........................................      7
9.       Use ..........................................................      7
10.      Assignment and Subletting ....................................      7
  10.1        Transfers ...............................................      7
  10.2        Consent Standards .......................................      8
  10.3        Request For Consent .....................................      8
  10.4        Conditions To Consent ...................................      8
  10.5        Cancellation ............................................      8
  10.6        Additional Compensation .................................      9
  10.7        Permitted Transfers .....................................      9

11.  Insurance, Waivers; Subrogation; Indemnity .......................     10
  11.1        Insurance ...............................................     10
  11.2        Waiver of Negligence; No Subrogation ....................     10
  11.3        Indemnity ...............................................     10
12.  Subordination; Attornment; Notice to Landlord's Mortgagee.........     11
  12.1        Subordination ...........................................     11
  12.2        Attornment ..............................................     11
  12.3        Notice to Landlord's Mortgagee ..........................     11
  12.4        Landlord's Mortgagee's Protection Provisions ............     11
13.  Rules and Regulations ............................................     12
14.           Condemnation ............................................     12
  14.1        Total Taking ............................................     12
</TABLE>

                                      -v-
<PAGE>   7
<TABLE>
<CAPTION>
<S>                                                                        <C>
  14.2        Partial Taking-Tenant's Rights ..........................     12
   14.3            Partial Taking-Landlord's Rights ...................     12
   14.4            Award ..............................................     12
15.                Fire or Other Casualty .............................     12
   15.1            Repair Estimate ....................................     13
   15.2            Landlord's and Tenant's Rights .....................     13
   15.3            Landlord's Rights ..................................     13
   15.4            Repair Obligation ..................................     13
   15.5            Waiver of Statutory Provisions .....................     13
16.                Personal Property Taxes ............................     14
17.                Events of Default ..................................     14
18.                Remedies ...........................................     15
   18.1            Termination ........................................     15
   18.2            Enforcement of Lease ...............................     15
   18.3            Sublessees of Tenant ...............................     16
   18.4            Efforts to Relet ...................................     16
19.                Payment by Tenant; Non-Waiver ......................     16
   19.1            Payment by Tenant ..................................     16
   19.2            No Waiver ..........................................     16
20.                Landlord's Lien ....................................     16
21.                Surrender of Premises ..............................     17
22.                Holding Over .......................................     17
23.                Certain Rights Reserved by Landlord ................     18
24.                Substitution Space .................................     18
25.                Miscellaneous ......................................     18
   25.1            Landlord Transfer ..................................     18
   25.2            Landlord's Liability ...............................     19
   25.3            Force Majeure ......................................     19
   25.4            Brokerage ..........................................     19
   25.5            Estoppel Certificates ..............................     19
   25.6            Notices ............................................     19
   25.7            Separability .......................................     19
   25.8            Amendments, and Binding Effect .....................     20
   25.9            Quiet Enjoyment ....................................     20
   25.10           No Merger ..........................................     20
   25.11           No Offer ...........................................     20
   25.12           Entire Agreement ...................................     20
   25.13           Waiver of Jury Trial ...............................     20
   25.14           Governing Law ......................................     20
   25.15           Joint and Several Liability ........................     20
   25.16           Financial Reports ..................................     20
   25.17           Landlord's Fees ....................................     21
   25.18           Attorney Fees ......................................     21
   25.19           Telecommunications .................................     21
   25.20           Confidentiality ....................................     21
</TABLE>

                                      -vi-
<PAGE>   8

<TABLE>
<CAPTION>
<S>                                                                        <C>
   25.21           Hazardous Materials ................................     22
   25.22           Signage ............................................     22
   25.23           Parking ............................................     22
   25.24           List Of Exhibits ...................................     22
26.                Renewal Option .....................................     23
   26.1            Grant of Options ...................................     23
   26.2            Basic Rent .........................................     23
   26.3            Termination of Option ..............................     23
27.                Right of First Offer ...............................     24
   27.1            Definitions ........................................     24
   27.2            First Right Space ..................................     24
   27.3            Miscellaneous ......................................     24
   27.4            No Extension .......................................     24
   27.5            Termination ........................................     25
</TABLE>

                                     -vii-

<PAGE>   9

TABLE OF EXHIBITS:

Exhibit A         Outline of Premises
Exhibit B         Description of Building
Exhibit C         Building Rules and Regulations
Exhibit D         Tenant Finish-Work
Exhibit E         Amendment No. I
Exhibit F         Form of Tenant Estoppel Certificate
Exhibit G         Depiction of Offer Space

                                     -viii-

<PAGE>   10

                              LIST OF DEFINED TERMS

Additional Rent.................................................................
Affiliate.......................................................................
Basic Lease Information.........................................................
Building........................................................................
Casualty........................................................................
Collateral......................................................................
Commencement Date...............................................................
Damage Notice...................................................................
Event of Default................................................................
GAAP............................................................................
Hazardous Materials.............................................................
HVAC............................................................................
Including.......................................................................
Interest Rate...................................................................
Land............................................................................
Landlord........................................................................
Landlord's Mortgagee............................................................
Law.............................................................................
Laws............................................................................
Lease...........................................................................
Lease Month.....................................................................
Loss............................................................................
Maximum Letter of Credit Amount.................................................
Operating Costs.................................................................
Operating Costs and Tax Statement...............................................
Parking Area....................................................................
Rent............................................................................
Taking..........................................................................
Tangible Net Worth..............................................................
Taxes...........................................................................
Tenant..........................................................................
Tenant Party....................................................................
Term............................................................................
Transfer........................................................................
UCC.............................................................................

                                      -ix-

<PAGE>   11

                                      LEASE

         THIS LEASE AGREEMENT (this "LEASE") is entered into as of November 18,
1998, between W9/PHC REAL ESTATE LIMITED PARTNERSHIP, a Delaware limited
partnership ("LANDLORD"), and SYNCHRONICITY, INC., a Massachusetts corporation
("TENANT").

         1. DEFINITIONS AND BASIC PROVISIONS. The definitions and basic
provisions set forth in the Basic Lease Information (the "BASIC LEASE
INFORMATION") executed by Landlord and Tenant contemporaneously herewith are
incorporated herein by reference for all purposes. Additionally, the following
terms shall have the following meanings when used in this Lease: "LAWS" means
all federal, state, and local laws, rules and regulations, all court orders,
governmental directives, and governmental orders, and all restrictive covenants
affecting the Property, and "LAW" shall mean any of the foregoing; "AFFILIATE"
means any person or entity which, directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with the
party in question; "TENANT PARTY" means any of the following persons: Tenant;
any assignees claiming by, through, or under Tenant; any subtenants claiming by,
through, or under Tenant; and any of their respective agents, contractors,
employees, and invitees; and "INCLUDING" means including, without limitation.

         2. LEASE GRANT. Subject to the terms of this Lease, Landlord leases to
Tenant, and Tenant leases from Landlord, the Premises.

         3. TERM. If the Premises are not ready for occupancy by Tenant on the
Commencement Date, then (a) Tenant's obligation to pay Basic Rent and Additional
Rent (as defined in Section 4) shall be waived until Landlord tenders possession
of the Premises to Tenant, (b) Landlord shall not be in default hereunder or be
liable for damages therefor, and (c) Tenant shall accept possession of the
Premises when Landlord tenders possession thereof to Tenant. By occupying the
Premises, Tenant shall be deemed to have accepted the Premises in their
condition as of the date of such occupancy, subject to the performance of
punch-list items that remain to be performed by Landlord, if any. Tenant shall
execute and deliver to Landlord, within ten days after Landlord has requested
the same, an amendment substantially in the form of Exhibit E hereto confirming
the Commencement Date and the expiration date of the initial Term, that Tenant
has accepted the Premises, and that Landlord has performed all of its
obligations with respect to the Premises (except for punch-list items specified
in such letter).

         4. RENT.

               4.1 PAYMENT. Tenant shall timely pay to Landlord Basic Rent and
all additional sums to be paid by Tenant to Landlord under this Lease
(collectively, the "RENT"), without deduction or set off, at Landlord's address
provided for in this Lease or as otherwise specified by Landlord, and shall be
accompanied by all applicable state and local sales or use taxes. Basic Rent,
adjusted as herein provided, shall be payable monthly in advance. The first
monthly installment of Basic Rent shall be payable contemporaneously with the
execution of this Lease; thereafter, Basic Rent shall be payable on the first
day of each month beginning on the first day of the second full calendar month
of the Term. The monthly Basic Rent for any partial

<PAGE>   12

month at the beginning of the Term shall equal the product of 1/365 of the
annual Basic Rent in effect during the partial month and the number of days in
the partial month from and after the Commencement Date, and shall be due on the
Commencement Date.

         4.2 OPERATING COSTS; TAXES.

               4.2.1 Tenant shall pay an amount (per each rentable square foot
in the Premises) ("ADDITIONAL RENT") equal to the difference between the
Operating Costs (defined below) per rentable square foot in the Building, and
the Expense Stop (calculated on a per rentable square foot basis). Landlord may
make a good faith estimate of the Additional Rent to be due by Tenant for any
calendar year or part thereof during the Term, and Tenant shall pay to Landlord,
on the Commencement Date and on the first day of each calendar month thereafter,
an amount equal to the estimated Additional Rent for such calendar year or part
thereof divided by the number of months therein. From time to time, Landlord may
estimate and re-estimate the Additional Rent to be due by Tenant and deliver a
copy of the estimate or re-estimate to Tenant. Thereafter, the monthly
installments of Additional Rent payable by Tenant shall be appropriately
adjusted in accordance with the estimations so that, by the end of the calendar
year in question, Tenant shall have paid all of the Additional Rent as estimated
by Landlord. Any amounts paid based on such an estimate shall be subject to
adjustment as herein provided when actual Operating Costs are available for each
calendar year.

               4.2.2 The term "OPERATING COSTS" shall mean all expenses and
disbursements (subject to the limitations set forth below) that Landlord incurs
in connection with the ownership, operation, and maintenance of the Building,
determined in accordance with sound accounting principles consistently applied,
including, but not limited to, the following costs: (A) wages and salaries
(including management fees) of all employees engaged in the operation,
maintenance, and security of the Building, including taxes, insurance and
benefits relating thereto; (B) all supplies and materials used in the operation,
maintenance, repair, replacement, and security of the Building; (C) costs for
improvements made to the Building which, although capital in nature, are
expected to reduce the normal operating costs of the Building (including all
utility costs), as well as capital improvements made in order to comply with any
law hereafter promulgated by any governmental authority, as amortized over the
useful economic life of such improvements as determinedly Landlord in its
reasonable discretion; (D) cost of all utilities, except the cost of other
utilities reimbursable to Landlord by the Building's tenants other than pursuant
to a provision similar to this Section 4.2; (E) insurance expenses; (F) repairs,
replacements, and general maintenance of the Building; and (G) service or
maintenance contracts with independent contractors for the operation,
maintenance, repair, replacement, or security of the Building (including,
without limitation, alarm service, window cleaning, and elevator maintenance).

               Operating Costs shall not include costs for (i) capital
improvements made to the Building, other than capital improvements described in
Section 4.2.2(C) and except for items which are generally considered maintenance
and repair items, such as painting of common areas, replacement of carpet in
elevator lobbies, and the like; (ii) repair, replacements and general
maintenance paid by proceeds of insurance or by Tenant or other third parties;
(iii) interest, amortization or other payments on loans to Landlord; (iv)
depreciation; (v) leasing commissions;

                                      -2-
<PAGE>   13

(vi) legal expenses for services, other than those that benefit the Building
tenants generally (e.g., tax disputes); (vii) renovating or otherwise improving
space for occupants of the Building or vacant space in the Building; (viii)
Taxes (defined below); and (ix) federal income taxes imposed on or measured by
the income of Landlord from the operation of the Building.

               4.2.3 Tenant shall also pay its Proportionate Share of any
increase in Taxes for each year and partial year falling within the Term over
the Taxes for the Base Year. Tenant shall pay its Proportionate Share of Taxes
in the same manner as provided above for Additional Rent with regard to
Operating Costs. "TAXES" shall mean taxes, assessments, and governmental charges
whether federal, state, county or municipal, and whether they be by taxing
districts or authorities presently taxing or by others, subsequently created or
otherwise, and any other taxes and assessments attributable to the Building (or
its operation), excluding, however, penalties and interest thereon and federal
and state taxes on income (if the present method of taxation changes so that in
lieu of the whole or any part of any Taxes, there is levied on Landlord a
capital tax directly on the rents received therefrom or a franchise tax,
assessment, or charge based, in whole or in part, upon such rents for the
Building, then all such taxes, assessments, or charges, or the part thereof so
based, shall be deemed to be included within the term "TAXES" for purposes
hereof). Taxes shall include the costs of consultants retained in an effort to
lower taxes and all costs incurred in disputing any taxes or in seeking to lower
the tax valuation of the Building. For property tax purposes, Tenant waives all
rights to protest or appeal the appraised value of the Premises, as well as the
Building, and all rights to receive notices of reappraisement.

               4.2.4 [INTENTIONALLY DELETED]

               4.2.5 By April 1 of each calendar year, or as soon thereafter as
practicable, Landlord shall furnish to Tenant a statement of Operating Costs for
the previous year, in each case adjusted as provided in Section 4.2.6, and of
the Taxes for the previous year (the "OPERATING COSTS AND TAX STATEMENT"). If
the Operating Costs and Tax Statement reveals that Tenant paid more for
Operating Costs than the actual amount for the year for which such statement was
prepared, or more than its actual share of Taxes for such year, then Landlord
shall promptly credit or reimburse Tenant for such excess; likewise, if Tenant
paid less than Tenant's actual Proportionate Share of Additional Rent or share
of Taxes due, then Tenant shall promptly pay Landlord such deficiency.

               4.2.6 With respect to any calendar year or partial calendar year
(including calendar year 1999) in which the Building is not occupied to the
extent of ninety-five percent (95%) of the rentable area thereof, the Operating
Costs for such period shall, for the purposes hereof, be increased to the amount
which would have been incurred had the Building been occupied to the extent of
ninety-five percent (95%) of the rentable area thereof.

     5. DELINQUENT PAYMENT, HANDLING CHARGES. All past due payments required of
Tenant hereunder shall bear interest from the date due until paid at the lesser
of ten percent (10%) per annum (the "INTEREST RATE") or the maximum lawful rate
of interest; additionally, Landlord may charge Tenant a fee equal to five
percent (5%) of the delinquent payment to reimburse Landlord for its cost and
inconvenience incurred as a consequence of Tenant's delinquency. In no event,
however, shall the charges permitted under this Section 5 or elsewhere

                                      -3-
<PAGE>   14

in this Lease, to the extent they are considered to be interest under applicable
Law, exceed the maximum lawful rate of interest.

     6. SECURITY DEPOSIT.

          6.1 SECURITY DEPOSIT. Contemporaneously with the execution of this
Lease, Tenant shall pay to Landlord the Security Deposit, which shall be held by
Landlord to secure Tenant's performance of its obligations under this Lease. The
Security Deposit is not an advance payment of Rent or a measure or limit of
Landlord's damages upon an Event of Default (defined in Section 17). Landlord
may, from time to time following an Event of Default and without prejudice to
any other remedy, use all or a part of the Security Deposit to perform any
obligation Tenant fails to perform hereunder. Following any such application of
the Security Deposit, Tenant shall pay to Landlord on demand the amount so
applied in order to restore the Security Deposit to its original amount.
Provided that Tenant has performed all of its obligations hereunder, Landlord
shall, within thirty (30) days after the Term ends, return to Tenant the portion
of the Security Deposit which was not applied to satisfy Tenant's obligations.
The Security Deposit may be commingled with other funds, and no interest shall
be paid thereon. If Landlord transfers its interest in the Premises and the
transferee assumes Landlord's obligations under this Lease, then Landlord may
assign the Security Deposit to the transferee and Landlord thereafter shall have
no transfer liability for the return of the Security Deposit.

          6.2 LETTER OF CREDIT. As additional security for Tenant's obligations
hereunder, concurrently with the execution of this Lease, Tenant shall deliver
to Landlord an irrevocable letter of credit as hereinafter described (the
"LETTER OF CREDIT"). The Letter of Credit shall (i) be an irrevocable standby
letter of credit, (ii) be issued by a reputable bank reasonably approved by
Landlord, (iii) name Landlord as beneficiary, (iv) be payable on sight draft
accompanied only by Landlord's statement that it is entitled to payment thereon
because an Event of Default under the Lease has occurred, (v) be for an initial
term of at least twelve (12) months and, subject to the terms set forth below,
shall be renewed each year thereafter to remain in effect during the entire
initial term of this Lease, and (vi) assure payment in the total amount of
$70,590.00. The following provisions shall govern the parties' rights and
obligations with respect to the Letter of Credit:

               6.2.1 Landlord shall be entitled to recourse against the Letter
of Credit to recover any loss or damage it may suffer as a result of any breach
or default by Tenant under this Lease. Partial draws shall be permitted under
the Letter of Credit.

               6.2.2 On each anniversary of the Commencement Date during the
initial term, provided an Event of Default has not occurred during the preceding
twelve (12) month period and Tenant's financial condition as of such anniversary
date is a net worth of at least three million dollars ($3,000,000.00) (defined
as Total Assets less Total Liabilities) and a current ratio of 2.0 (defined as
Total Current Assets divided by Total Current Liabilities, Landlord shall reduce
the required amount of the Letter of Credit by the sum of $23,530.00 each year
until the required amount of the Letter of Credit is reduced to $0.00. Subject
to the above, Tenant's failure to keep the Letter of Credit in effect during the
entire initial term of the Lease, or Tenant's failure

                                      -4-
<PAGE>   15

to furnish written evidence to Landlord of the yearly renewal of the Letter of
Credit, shall be an Event of Default hereunder.

     7. LANDLORD'S OBLIGATIONS.

          7.1 SERVICES. Landlord shall use all reasonable efforts to furnish to
Tenant (1) water at those points of supply provided for general use of tenants
of the Building; (2) heated and refrigerated air conditioning ("HVAC") as
appropriate, at such temperatures and in such amounts as are standard for
comparable buildings in the vicinity of the Building; (3) janitorial service to
the Premises on weekdays, other than holidays, for Building standard
installations and such window washing as may from time to time be reasonably
required; (4) elevators for ingress and egress to the floor on which the
Premises are located, in common with other tenants, provided that Landlord may
reasonably limit the number of operating elevators during non-business hours and
holidays; and (5) electrical current during normal business hours for equipment
that does not require more than 110 volts and whose electrical energy
consumption does not exceed normal office usage. Landlord shall maintain the
common areas of the Building in reasonably good order and condition, except for
damage caused by a Tenant Party. If Tenant desires any of the services specified
in Section 7.1(2): (A) at any time other than between 7:30 a.m. and 6:00 p.m. on
weekdays, or (B) on Saturdays, Sundays or holidays observed by Landlord, then
such services shall be supplied to Tenant upon the written request of Tenant
delivered to Landlord before 3:00 p.m. on the business day preceding such extra
usage, and Tenant shall pay to Landlord the cost of such services within ten
(10) days after Landlord has delivered to Tenant an invoice therefor. The costs
incurred by Landlord in providing after-hour HVAC service to Tenant shall
include costs for electricity, water, sewage, water treatment, labor, metering,
filtering, and maintenance reasonably allocated by Landlord to providing such
service.

          7.2 EXCESS UTILITIES. Landlord shall not be required to furnish
electrical current for equipment that requires more than 110 volts or other
equipment whose electrical energy consumption exceeds normal office usage. If
Tenant's requirements for or consumption of electricity exceed the electricity
to be provided by Landlord as described in Section 7.1, Landlord shall, at
Tenant's expense, make reasonable efforts to supply such service through the
then-existing feeders and risers serving the Building and the Premises, and
Tenant shall pay to Landlord the cost of such service within ten (10) days after
Landlord has delivered to Tenant an invoice therefor. Landlord may determine the
amount of such additional consumption and potential consumption by any
verifiable method, including installation of a separate meter in the Premises
installed, maintained, and read by Landlord, at Tenant's expense. Tenant shall
not install any electrical equipment requiring special wiring or requiring
voltage in excess of 110 volts or otherwise exceeding Building capacity unless
approved in advance by Landlord. The use of electricity in the Premises shall
not exceed the capacity of existing feeders and risers to or wiring in the
Premises. Any risers or wiring required to meet Tenant's excess electrical
requirements shall, upon Tenant's written request, be installed by Landlord, at
Tenant's cost, if, in Landlord's judgment, the same are necessary and shall not
cause permanent damage to the Building or the Premises, cause or create a
dangerous or hazardous condition, entail excessive or unreasonable alterations,
repairs, or expenses, or interfere with or disturb other tenants of the
Building. If Tenant uses machines or equipment in the Premises which affect the
temperature otherwise maintained by the air conditioning system or otherwise
overload any utility, Landlord

                                      -5-
<PAGE>   16

may install supplemental air conditioning units or other supplemental equipment
in the Premises, and the cost thereof, including the cost of installation,
operation, use, and maintenance, shall be paid by Tenant to Landlord within ten
(10) days after Landlord has delivered to Tenant an invoice therefor.

          7.3 RESTORATION OF SERVICES; ABATEMENT. Landlord shall use reasonable
efforts to restore any service required of it that becomes unavailable; however,
such unavailability shall not render Landlord liable for any damages caused
thereby, be a constructive eviction of Tenant, constitute a breach of any
implied warranty, or, except as provided in the next sentence, entitle Tenant to
my abatement of Tenant's obligations hereunder. If, however, Tenant is prevented
from using the Premises for more than twenty-five (25) consecutive business days
because of the unavailability of any such service and such unavailability was
not caused by a Tenant Party, then Tenant shall, as its exclusive remedy be
entitled to a reasonable abatement of Rent for each consecutive day (after such
twenty-five (25) day period) that Tenant is so prevented from using the
Premises.

     8. IMPROVEMENTS; ALTERATIONS; REPAIRS; MAINTENANCE.

          8.1 IMPROVEMENTS, ALTERATIONS. Improvements to the Premises shall be
installed at Tenant's expense only in accordance with plans and specifications
which have been previously submitted to and approved in writing by Landlord. No
alterations or physical additions in or to the Premises may be made without
Landlord's prior written consent, which shall not be unreasonably withheld or
delayed; however, Landlord may withhold its consent to any alteration or
addition that would affect the Building's structure or its HVAC, plumbing,
electrical, or mechanical systems. Tenant shall not paint or install lighting or
decorations, signs, window or door lettering, or advertising media of any type
on or about the Premises without the prior written consent of Landlord, which
shall not be unreasonably withheld or delayed; however, Landlord may withhold
its consent to any such painting or installation which would affect the
appearance of the exterior of the Build or of my common areas of the Building.
All alterations, additions, and improvements shall be constructed, maintained,
and used by Tenant, at its risk and expense, in accordance with all Laws;
Landlord's approval of the plans and specifications therefor shall not be a
representation by Landlord that such alterations, additions, or improvements
comply with my Law.

          8.2 REPAIRS; MAINTENANCE. Tenant shall maintain the Premises in a
clean, safe, and operable condition, and shall not permit or allow to remain any
waste or damage to any portion of the Premises. Tenant shall repair or replace,
subject to Landlord's direction and supervision, any damage to the Building
caused by a Tenant Party. If Tenant fails to make such repairs or replacements
within fifteen (15) days after the occurrence of such damage, then Landlord may
make the same at Tenant's cost. If any such damage occurs outside of the
Premises, then Landlord may elect to repair such damage at Tenant's expense,
rather than having Tenant repair such damage. The cost of all repair or
replacement work performed by Landlord under this Section 8 shall be paid by
Tenant to Landlord within ten (10) days after Landlord has invoiced Tenant
therefor. Tenant hereby waives and releases its right to make repairs at
Landlord's expense under Sections 1941 and 1942 of the California Civil Code or
under any similar law, statute, or ordinance now or hereafter in effect.

                                      -6-
<PAGE>   17

          8.3 PERFORMANCE OF WORK. All work described in this Section 8 shall be
performed only by Landlord or by contractors and subcontractors approved in
writing by Landlord. Tenant shall cause all contractors and subcontractors to
procure and maintain insurance coverage naming Landlord as an additional insured
against such risks, in such amounts, and with such companies as Landlord may
reasonably require. All such work shall be performed in accordance with all Laws
and in a good and workmanlike manner so as not to damage the Building (including
the Premises, the structural elements, and the plumbing, electrical lines, or
other utility transmission facility). All such work which may affect the
Building's HVAC, electrical, plumbing, other mechanical systems, or structural
elements must be approved by the Building's engineer of record, at Tenant's
expense and, at Landlord's election, must be performed by Landlord's usual
contractor for such work.

          8.4 MECHANIC'S LIENS. Tenant shall not permit any mechanic's liens to
be filed against the Premises or the Building for any work performed, materials
furnished, or obligation incurred by or at the request of Tenant. If such a lien
is filed, then Tenant shall, within ten (10) days after Landlord has delivered
notice of the filing thereof to Tenant, either pay the amount of the lien or
diligently contest such lien and deliver to Landlord a bond or other security
reasonably satisfactory to Landlord. If Tenant fails to timely take either such
action, then Landlord may pay the lien claim, and any amounts so paid, including
expenses and interest, shall be paid by Tenant to Landlord within ten (10) days
after Landlord has invoiced Tenant therefor.

         9. USE. Tenant shall continuously occupy and use the Premises only for
the Permitted Use, and shall comply with all Laws relating to the use,
condition, access to, and occupancy of the Premises. The population density
within the Premises as a whole shall at no time exceed one person for each 300
rentable square feet in the Premises. Tenant shall not conduct second or third
shift operations within the Premises; however, Tenant may use the Premises after
normal business hours, so long as Tenant is not generally conducting business
from the Premises after normal business hours. The Premises shall not be used
for any use which is disreputable, creates extraordinary fire hazards, or
results in an increased rate of insurance on the Building or its contents, or
for the storage of any Hazardous Materials. If, because of a Tenant Party's
acts, the rate of insurance on the Building or its contents increases, then such
acts shall be an Event of Default, Tenant shall pay to Landlord the amount of
such increase on demand, and acceptance of such payment shall not waive any of
Landlord's other rights. Tenant shall conduct its business and control each
other Tenant Party so as not to create any nuisance or unreasonably interfere
with other tenants or Landlord in its management of the Building.

          10. ASSIGNMENT AND SUBLETTING.

               10.1 TRANSFERS. Except as provided in Section 10.7, Tenant shall
not, without the prior written consent of Landlord, (1) assign, transfer, or
encumber this Lease or any estate or interest herein, whether directly or by
operation of law, (2) permit any other entity to become Tenant hereunder by
merger, consolidation, or other reorganization, (3) if Tenant is an entity other
than a corporation whose stock is publicly traded, permit the transfer of an
ownership interest in Tenant so as to result in a change in the current control
of Tenant, (4) sublet any portion of the Premises, (5) grant any license,
concession, or other right of occupancy of any

                                      -7-
<PAGE>   18

portion of the Premises, or (6) permit the use of the Premises by any parties
other than Tenant (any of the events listed in Sections 10.1(1) through 10.1(6)
being a "TRANSFER").

               10.2 CONSENT STANDARDS. Landlord shall not unreasonably withhold
its consent to any assignment or subletting of the Premises, provided that the
proposed transferee is creditworthy, has a good reputation in the business
community, will use the Premises for the Permitted Use (thus, excluding, without
limitation uses for credit processing and telemarketing) and will not use the
Premises in any manner that would conflict with any exclusive use agreement or
other similar agreement entered into by Landlord with any other tenant of the
Building, is not a governmental entity, or subdivision or agency thereof, and is
not another occupant of the Building or person or entity with whom Landlord is
negotiating to lease space in the Building; otherwise, Landlord may withhold its
consent in its sole discretion.

               10.3 REQUEST FOR CONSENT. If Tenant requests Landlord's consent
to a transfer, then Tenant shall provide Landlord with a written description of
all terms and conditions of the proposed Transfer, copies of the proposed
documentation, and the following information about the proposed transferee: name
and address; reasonably satisfactory information about its business and business
history; its proposed use of the Premises; banking, financial, and other credit
information; and general references sufficient to enable Landlord to determine
the proposed transferee's creditworthiness and character. Concurrently with
Tenant's notice of any request for consent to a Transfer, Tenant shall pay to
Landlord a fee of $750.00 to defray Landlord's expenses in reviewing such
request, and Tenant shall also reimburse Landlord immediately upon request for
its reasonable attorney's fees incurred in connection with considering any
request for consent to a Transfer.

               10.4 CONDITIONS TO CONSENT. If Landlord consents to a proposed
Transfer, then the proposed transferee shall deliver to Landlord a written
agreement whereby it expressly assumes Tenant's obligations hereunder; however,
any transferee of less than all of the space in the Premises shall be liable
only for obligations under this Lease that are properly allocable to the space
subject to the Transfer for the period of the Transfer. No Transfer shall
release Tenant from its obligations under this Lease, but rather Tenant and its
transferee shall be jointly and severally liable therefore Landlord's consent to
any Transfer shall not waive Landlord's rights as to any subsequent Transfers.
If an Event of Default occurs while the Premises or any part thereof are subject
to a Transfer, then Landlord, in addition to its other remedies, may collect
directly from such transferee all rents becoming due to Tenant and apply such
rents against Rent. Tenant authorizes its transferees to make payments of rent
directly to Landlord upon receipt of notice from Landlord to do so. Tenant shall
pay for the cost of any demising walls or other improvements necessitated by a
proposed subletting or assignment.

               10.5 CANCELLATION. Landlord may, within thirty (30) days after
submission of Tenant's written request for Landlord's consent to an assignment
or subletting, cancel this Lease as to the portion of the Premises proposed to
be sublet or assigned as of the date the proposed Transfer is to be effective.
If Landlord cancels this Lease as to any portion of the Premises, then this
Lease shall cease for such portion of the Premises and Tenant shall pay to
Landlord all Rent accrued through the cancellation date relating to the portion
of the Premises covered by the

                                      -8-
<PAGE>   19

proposed Transfer. Thereafter, Landlord may lease such portion of the Premises
to the prospective transferee (or to any other person) without liability to
Tenant.

               10.6 ADDITIONAL COMPENSATION. Tenant shall pay to Landlord,
immediately upon receipt thereof, one-half of the excess of (1) all compensation
received by Tenant for a Transfer less the costs reasonably incurred by Tenant
with unaffiliated third parties in connection with such Transfer (i.e.,
brokerage commissions, tenant finish work, and the like) over (2) the Rent
allocable to the portion of the Premises covered thereby.

               10.7 PERMITTED TRANSFERS. Notwithstanding Section 10.1, Tenant
may Transfer all or part of its interest in this Lease or all or part of the
Premises (a "PERMITTED TRANSFERS") to the following types of entities (a
"PERMITTED TRANSFEREE") without the written consent of Landlord:

                  10.7.1 An Affiliate of Tenant;

                  10.7.2 Any corporation, limited partnership, limited liability
partnership, limited liability company or other business entity in which or with
which Tenant, or its corporate successors or assigns, is merged or consolidated,
in accordance with applicable statutory provisions governing merger and
consolidation of business entities, so long as (A) Tenant's obligations
hereunder are assumed by the entity surviving such merger or created by such
consolidation; and (B) the Tangible Net Worth of the surviving or created entity
is not less than the Tangible Net Worth of Tenant as of the date hereof; or

                  10.7.3 Any corporation, limited partnership, limited liability
partnership, limited liability company or other business entity acquiring all or
substantially all of Tenant's assets if such entity's Tangible Net Worth after
such acquisition is not less than the Tangible Net Worth of Tenant as of the
date hereof.

Tenant shall promptly notify Landlord of any such Permitted Transfer. Tenant
shall remain liable for the performance of all of the obligations of Tenant
hereunder, or if Tenant no longer exists because of a merger, consolidation, or
acquisition, the surviving or acquiring entity shall expressly assume in writing
the obligations of Tenant hereunder. Additionally, the Permitted Transferee
shall comply with all of the terms and conditions of this Lease, including the
Permitted Use, and the use of the Premises by the Permitted Transferee may not
violate any other agreements affecting the Premises, the Building, Landlord or
other tenants of the Building. At least thirty (30) days after the effective
date of any Permitted Transfer, Tenant agrees to furnish Landlord with copies of
the instrument effecting any of the foregoing Transfers and documentation
establishing Tenant's satisfaction of the requirements set forth above
applicable to any such Transfer. The occurrence of a Permitted Transfer shall
not waive Landlord's rights as to any subsequent Transfers. "TANGIBLE NET WORTH"
means the excess of total assets over total liabilities, in each case as
determined in accordance with generally accepted accounting principles
consistently applied ("GAAP"), excluding, however, from the determination of
total assets all assets which would be classified as intangible assets under
GAAP including, without limitation, goodwill, licenses, patents, trademarks,
trade names, copyrights, and franchises. Any

                                      -9-
<PAGE>   20

subsequent Transfer by a Permitted Transferee shall be subject to Landlord's
prior written consent (which Landlord may grant or deny in its sole discretion).

         11. INSURANCE, WAIVERS; SUBROGATION; INDEMNITY.

             11.1 INSURANCE. Tenant shall maintain throughout the Term the
following insurance policies: (1) commercial general liability insurance in
amounts of $3,000,000.00 per occurrence, or such other amounts as Landlord may
from time to time reasonably require, insuring Tenant, Landlord, Landlord's
agents and their respective Affiliates against all liability for injury to or
death of a person or persons or damage to property arising from the use and
occupancy of the Premises; (2) insurance covering the full value of Tenant's
property and improvements, and other property (including property of others) in
the Premises; (3) contractual liability insurance sufficient to cover Tenant's
indemnity obligations hereunder (but only if such contractual liability
insurance is not already included in Tenant's commercial general liability
insurance policy); (4) worker's compensation insurance, containing a waiver of
subrogation endorsement acceptable to Landlord; and (5) business interruption
insurance. Tenant's insurance shall provide primary coverage to Landlord when
any policy issued to Landlord provides duplicate or similar coverage, and in
such circumstance Landlord's policy will be excess over Tenant's policy. Tenant
shall furnish to Landlord certificates of such insurance and such other evidence
satisfactory to Landlord of the maintenance of all insurance coverages required
hereunder, and Tenant shall obtain a written obligation on the part of each
insurance company to notify Landlord at least thirty (30) days before
cancellation or a material change of any such insurance policies. All such
insurance policies shall be in form, and issued by companies, reasonably
satisfactory to Landlord.

             11.2 WAIVER OF NEGLIGENCE; NO SUBROGATION. Landlord and Tenant each
waives any claim it might have against the other for any injury to or death of
any person or persons or damage to or theft, destruction, loss, or loss of use
of any property (a "LOSS"), to the extent the same is insured against under any
insurance policy that covers the Building, the Premises, Landlord's or Tenant's
fixtures, personal property, leasehold improvements, or business, or, in the
case of Tenant's waiver, is required to be insured against under the terms
hereof, regardless of whether the negligence of the other party caused such
Loss; however, Landlord's waiver shall not include any deductible amounts on
insurance policies carried by Landlord. Each party shall cause its insurance
carrier to endorse all applicable policies waiving the carrier's rights of
recovery under subrogation or otherwise against the other party.

             11.3 INDEMNITY. Subject to Section 11.2, Tenant shall defend,
protect, indemnify, and hold harmless Landlord and its representatives and
agents from and against all claims, demands, liabilities, causes of action,
suits, judgments, damages, and expenses (including attorney fees) arising from
(1) any Loss arising from any occurrence on the Premises (other than any Loss
arising out of a breach of Tenant's obligations under Section 25.21, which shall
be subject to the indemnity in such section), or (2) Tenant's failure to perform
its obligations under this Lease, even though caused or alleged to be caused by
the negligence or fault of Landlord or its agents (other than a Loss arising
from the sole or gross negligence of Landlord or its agents), and even though
any such claim, cause of action, or suit is based upon or alleged to be based
upon the strict liability of Landlord or its agents. This indemnity is intended
to indemnify

                                      -10-
<PAGE>   21

Landlord and its agents against the consequences of their own negligence when
Landlord or its agents are jointly, comparatively, contributively, or
concurrently negligent with Tenant. This indemnity provision shall survive
termination or expiration of this Lease. If any proceeding is filed for which
indemnity is required hereunder, Tenant agrees, upon request therefor, to defend
the indemnified party in such proceeding at its sole cost utilizing counsel
satisfactory to the indemnified party.

         12. SUBORDINATION; ATTORNMENT; NOTICE TO LANDLORD'S MORTGAGEE.

             12.1 SUBORDINATION. This Lease shall be subordinate to any deed of
trust, mortgage, or other security instrument, or any ground lease, master
lease, or primary lease, that now or hereafter covers all or any part of the
Premises (the mortgagee under any such mortgage or the lessor under any such
lease is referred to herein as a "LANDLORD'S MORTGAGEE"). Any Landlord's
Mortgagee may elect, at any time, unilaterally, to make this Lease superior to
its mortgage, ground lease, or other interest in the Premises by so notifying
Tenant in writing.

             12.2 ATTORNMENT. Tenant shall attorn to any party succeeding to
Landlord's interest in the Premises, whether by purchase, foreclosure, deed in
lieu of foreclosure, power of sale, termination of lease, or otherwise, upon
such party's request, and shall execute such agreements confirming such
attornment as such party may reasonably request.

             12.3 NOTICE TO LANDLORD'S MORTGAGEE. Tenant shall not seek to
enforce any remedy it may have for any default on the part of Landlord without
first giving written notice by certified mail, return receipt requested,
specifying the default in reasonable detail, to any Landlord's Mortgagee whose
address has been given to Tenant, and affording such Landlord's Mortgagee a
reasonable opportunity to perform Landlord's obligations hereunder.

             12.4 LANDLORD'S MORTGAGEE'S PROTECTION PROVISIONS. If Landlord's
Mortgagee shall succeed to the interest of Landlord under this Lease, Landlord's
Mortgagee shall not be: (1) liable for any act or omission of any prior lessor
(including Landlord); (2) bound by any rent or additional rent or advance rent
which Tenant might have paid for more than the current month to any prior lessor
(including Landlord), and all such rent shall remain due and owing,
notwithstanding such advance payment; (3) bound by any security or advance
rental deposit made by Tenant which is not delivered or paid over to Landlord's
Mortgagee and with respect to which Tenant shall look solely to Landlord for
refund or reimbursement; (4) bound by any termination, amendment or modification
of this Lease made without Landlord's Mortgagee's consent and written approval,
except for those terminations, amendments and modifications permitted to be made
by Landlord without Landlord's Mortgagee's consent pursuant to the terms of the
loan documents between Landlord and Landlord's Mortgagee; (5) subject to the
defenses which Tenant might have against any prior lessor (including Landlord);
and (6) subject to the offsets which Tenant might have against any prior lessor
(including Landlord) except for those offset rights which (A) are expressly
provided in this Lease, (B) relate to periods of time following the acquisition
of the Building by Landlord's Mortgagee, and (C) Tenant has provided written
notice to Landlord's Mortgagee and provided Landlord's Mortgagee a reasonable
opportunity to cure the event giving rise to such offset event. Landlord's
Mortgagee shall have no liability or responsibility under or pursuant to the
terms of this Lease or otherwise after it

                                      -11-
<PAGE>   22

ceases to own an interest in the Building. Nothing in this Lease shall be
construed to require Landlord's Mortgagee to see to the application of the
proceeds of any loan, and Tenant's agreements set forth herein shall not be
impaired on account of any modification of the documents evidencing and securing
any loan.

         13. RULES AND REGULATIONS. Tenant shall comply with the rules and
regulations of the Building which are attached hereto as Exhibit C. Landlord
may, from time to time, change such rules and regulations for the safety, care,
or cleanliness of the Building and related Facilities, provided that such
changes are applicable to all tenants of the Building and will not unreasonably
interfere with Tenant's use of the Premises. Tenant shall be responsible for the
compliance with such rules and regulations by each Tenant Party.

         14. CONDEMNATION.

             14.1 TOTAL TAKING. If the entire Building or Premises are taken by
right of eminent domain or conveyed in lieu thereof (a "TAKING"), this Lease
shall terminate as of the date of the Taking.

             14.2 PARTIAL TAKING-TENANT'S RIGHTS. If any part of the Building
becomes subject to a Taking and such Tenant will prevent Tenant from conducting
its business in the Premises in a manner reasonably comparable to that conducted
immediately before such Taking for a period of more than one hundred eighty
(180) days, then Tenant may terminate this Lease as of the date of such Taking
by giving written notice to Landlord within thirty (30) days after the Taking,
and Rent shall be apportioned as of the date of such Taking. If Tenant does not
terminate this Lease, then Rent shall be abated on a reasonable basis as to that
portion of the Premises rendered untenantable by the Taking.

             14.3 PARTIAL TAKING-LANDLORD'S RIGHTS. If any material portion, but
less than all, of the Building becomes subject to a Taking, or if Landlord is
required to pay any of the proceeds received for a Taking to a Landlord's
Mortgagee, then Landlord may terminate this Lease by delivering written notice
thereof to Tenant within thirty (30) days after such Taking, and Rent shall be
apportioned as of the date of such Taking. If Landlord does not so terminate
this Lease, then this Lease will continue, but if any portion of the Premises
has been taken, Rent shall abate as provided in the last sentence of Section
14.2. Tenant hereby waives any and all rights it might otherwise have pursuant
to Section 1265.130 of The California Code of Civil Procedure.

             14.4 AWARD. If any Taking occurs, then Landlord shall receive the
entire award or other compensation for the land on which the Building is
situated, the Building, and other improvements taken, and Tenant may separately
pursue a claim (to the extent it will not reduce Landlord's award) against the
condemnor for the value of Tenant's personal property which Tenant is entitled
to remove under this Lease, moving costs and loss of business.

         15. FIRE OR OTHER CASUALTY.

                                      -12-
<PAGE>   23

             15.1 REPAIR ESTIMATE. If the Premises or the Building are damaged
by fire or other casualty (a "CASUALTY"), Landlord shall, within ninety (90)
days after such Casualty, deliver to Tenant a good faith estimate (the "DAMAGE
NOTICE") of the time needed to repair the damage caused by such Casualty.

             15.2 LANDLORD'S AND TENANT'S RIGHTS. If a material portion of the
Premises or the Building is damaged by Casualty such that Tenant is prevented
from conducting its business in the Premises in a manner reasonably comparable
to that conducted immediately before such Casualty and Landlord estimates that
the damage caused thereby cannot be repaired within two hundred seventy (270)
days after the Casualty, then Tenant may terminate this Lease by delivering
written notice to Landlord of its election to terminate within thirty (30) days
after the Damage Notice has been delivered to Tenant. If Tenant does not so
timely terminate this Lease, then (subject to Section 15.3) Landlord shall
repair the Building or the Premises, as the case may be, as provided below, and
Rent for the portion of the Premises rendered untenantable by the damage shall
be abated on a reasonable basis from the date of damage until the completion of
the repair, unless a Tenant Party caused such damage, in which case, Tenant
shall continue to pay Rent without abatement.

             15.3 LANDLORD'S RIGHTS. If a Casualty damages a material portion of
the Building, and Landlord makes a good faith determination that restoring the
Premises would be uneconomical, or if Landlord is required to pay any insurance
proceeds arising out of the Casualty to a Landlord's Mortgagee, then Landlord
may terminate this Lease by giving written notice of its election to terminate
within thirty (30) days after the Damage Notice has been delivered to Tenant,
and Basic Rent and Additional Rent shall be abated as of the date of the
Casualty.

             15.4 REPAIR OBLIGATION. If neither party elects to terminate this
Lease following a Casualty, then Landlord shall, within a reasonable time after
such Casualty, begin to repair the Building and the Premises and shall proceed
with reasonable diligence to restore the Building and Premises to substantially
the same condition as they existed immediately before such Casualty; however,
Landlord shall not be required to repair or replace any of the furniture,
equipment, fixtures, and other improvements which may have been placed by, or at
the request of, Tenant or other occupants in the Building or the Premises, and
Landlord's obligation to repair or restore the Building or Premises shall be
limited to the extent of the insurance proceeds actually received by Landlord
for the Casualty in question.

             15.5 WAIVER OF STATUTORY PROVISIONS. The provisions of this Lease,
including this Article 15, constitute an express agreement between Landlord and
Tenant with respect to any and all damage to, or destruction of, all or any part
of the Premises or the Building and any statute or regulation of the State of
California, including, without limitation, Sections 1932(2) and 1933(4) of the
California Civil Code, with respect to any rights or obligations concerning
damage or destruction in the absence of an express agreement between the
parties, and any other statute or regulation, now or hereafter in effect, shall
have no application to this Lease or any damage or destruction to all or any
part of the Premises or the Building.

                                      -13-
<PAGE>   24

         16. PERSONAL PROPERTY TAXES. Tenant shall be liable for all taxes
levied or assessed against personal property, furniture, or fixtures placed by
Tenant in the Premises. If any taxes for which Tenant is liable are levied or
assessed against Landlord or Landlord's property and Landlord elects to pay the
same, or if the assessed value of Landlord's property is increased by inclusion
of such personal property, furniture or fixtures and Landlord elects to pay the
taxes based on such increase, then Tenant shall pay to Landlord, upon demand,
the part of such taxes for which Tenant is primarily liable hereunder; however,
Landlord shall not pay such amount if Tenant notifies Landlord that it will
contest the validity or amount of such taxes before Landlord makes such payment,
and thereafter diligently proceeds with such contest in accordance with law and
if the nonpayment thereof does not pose a threat of loss or seizure of the
Building or interest of Landlord therein or impose any fee or penalty against
Landlord.

         17. EVENTS OF DEFAULT. Each of the following occurrences shall be an
"EVENT OF DEFAULT":

             17.1 Tenant fails to pay Rent within five (5) days after Landlord
has delivered notice to Tenant that the same is due (any such notice shall be in
lieu of, and not in addition to, any notice required under California Code of
Civil Procedure Section 1161 or any similar or successor law); however, an Event
of Default shall occur hereunder without any obligation of Landlord to give any
notice if Landlord has given Tenant written notice under this Section 17.1 on
more than one occasion during the twelve (12) month interval preceding such
failure by Tenant;

             17.2 Tenant (1) abandons or vacates the Premises or any substantial
portion thereof, or (2) fails to continuously operate its business in the
Premises;

             17.3 Tenant fails to comply with the Permitted Use set forth herein
and such failure continues for a period of five (5) days after Landlord has
delivered to Tenant written notice thereof,

             17.4 Tenant fails to provide any estoppel certificate within the
time period required under Section 25.5 and such failure continues for five (5)
days after written notice thereof from Landlord to Tenant;

             17.5 Tenant fails to perform, comply with, or observe any other
agreement or obligation of Tenant under this Lease and such failure continues
for a period of more than thirty (30) days after Landlord has delivered to
Tenant written notice thereof (any such notice shall be in lieu of, and not in
addition to, any notice required under California Code of Civil Procedure
Section 1161 or any similar or successor law); and

             17.6 The filing of a petition by or against Tenant (the term
"TENANT" shall include, for the purpose of this Section 17.6, any guarantor of
Tenant's obligations hereunder) (1) in any bankruptcy or other insolvency
proceeding; (2) seeking any relief under any state or federal debtor relief law;
(3) for the appointment of a liquidator or receiver for all or substantially all
of Tenant's property or for Tenant's interest in this Lease; or (4) for the
reorganization or modification of Tenant's capital structure; however, if such a
petition is filed against Tenant,

                                      -14-
<PAGE>   25

then such filing shall not be an Event of Default unless Tenant fails to have
the proceedings initiated by such petition dismissed within ninety (90) days
after the filing thereof.

         18. REMEDIES. Upon any Event of Default Landlord may, in addition to
all other rights and remedies afforded Landlord hereunder or by law or equity,
take any of the following actions, each and all of which shall be cumulative and
nonexclusive, without notice or demand whatsoever:

             18.1 TERMINATION. Terminate this Lease, in which event Tenant shall
immediately surrender the Premises to Landlord, and if Tenant fails to do so,
Landlord may, without prejudice to any other remedy which it may have for
possession or arrearages in rent, enter upon and take possession of the Premises
and expel or remove Tenant and any other person who may be occupying the
Premises or any part thereof, without being liable for prosecution or any claim
or damages therefor; and Landlord may recover from Tenant the following:

                  18.1.1 The worth at the time of award of any unpaid rent which
has been earned at the time of such termination; plus

                  18.1.2 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

                  18.1.3 The worth at the time of award of the amount by which
the unpaid rent for the balance of the Lease Term after the time of award
exceeds the amount of such rental loss that Tenant proves could have been
reasonably avoided; plus

                  18.1.4 Any other amount necessary to compensate Landlord for
all the detriment proximately caused by Tenant's failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, specifically including, but not limited to,
brokerage commissions and advertising expenses incurred, expenses of remodeling
the Premises or any portion thereof for a new tenant, whether for the same or a
different use, and any special concessions made to obtain a new tenant; and

                  18.1.5 At Landlord's election, such other amounts in addition
to or in lieu of the foregoing as may be permitted from time to time by
applicable law.

             The Term "rent" as used in this Section 18.1 shall be deemed to be
and to mean all sums of every nature required to be paid by Tenant, pursuant to
the terms of this Lease, whether to Landlord or to others. As used in Sections
18.1.1 and 18.1.2 above, the "worth at the time of award" shall be computed by
allowing interest at the Interest Rate set forth in Section 5 of this Lease, but
in no case greater than the maximum amount of such interest permitted by law. As
used in Section 18.1.3 above, the "worth at the time of award" shall be computed
by discounting such amount at the discount rate of the Federal Reserve Bank of
San Francisco at the time of award plus one percent (1%).

             18.2 ENFORCEMENT OF LEASE. Landlord shall have the remedy described
in California Civil Code Section 1951.4 (lessor may continue lease in effect
after lessee's breach

                                      -15-
<PAGE>   26

and abandonment and recover rent as it becomes due, if lessee has the right to
sublet or assign, subject only to reasonable limitations). Accordingly, Landlord
may, from time to time, without terminating this Lease, enforce all of its
rights and remedies under this Lease, including the right to recover all rent as
it becomes due.

             18.3 SUBLESSEES OF TENANT. Whether or not Landlord elects to
terminate this Lease on account of any default by Tenant, as set forth in this
Section 18, Landlord shall have the right to terminate any and all subleases,
licenses, concessions or other consensual arrangements for possession entered
into by Tenant and affecting the Premises or may, in Landlord's sole discretion,
succeed to Tenant's interest in such subleases, licenses, concessions or
arrangements. In the event of Landlord's election to succeed to Tenant's
interest in any such subleases, licenses, concessions or arrangements, Tenant
shall, as of the date of notice by Landlord of such election, have no further
right to or interest in the rent or other consideration receivable thereunder.

             18.4 EFFORTS TO RELET. For the purposes of this Section 18,
Tenant's right to possession shall not be deemed to have been terminated by
efforts of Landlord to relet the Premises, by its acts of maintenance or
preservation with respect to the Premises, or by appointment of a receiver to
protect Landlord's interests hereunder. The foregoing enumeration is not
exhaustive, but merely illustrative of acts which may be performed by Landlord
without terminating Tenant's right to possession.

         19. PAYMENT BY TENANT; NON-WAIVER.

             19.1 PAYMENT BY TENANT. Upon any Event of Default, Tenant shall pay
to Landlord all costs incurred by Landlord (including court costs and reasonable
attorney fees and expenses) in (1) obtaining possession of the Premises, (2)
removing and storing Tenant's or any other occupant's property, (3) repairing,
restoring, altering, remodeling, or otherwise putting the Premises into
condition acceptable to a new tenant, (4) performing Tenant's obligations which
Tenant failed to perform, and (5) enforcing, or advising Landlord of, its
rights, remedies, and recourses arising out of the Event of Default. To the full
extent permitted by law, Landlord and Tenant agree the federal and state courts
of the state in which the Premises are located shall have exclusive jurisdiction
over any matter relating to or arising from this Lease and the parties' rights
and obligations under this Lease.

             19.2 NO WAIVER. Landlord's acceptance of Rent following an Event of
Default shall not waive Landlord's rights regarding such Event of Default. No
waiver by Landlord of any violation or breach of any of the terms contained
herein shall waive Landlord's rights regarding any future violation of such
term. Landlord's acceptance of any partial payment of Rent shall not waive
Landlord's rights with regard to the remaining portion of the Rent that is due,
regardless of any endorsement or other statement on any instrument delivered in
payment of Rent or any writing delivered in connection therewith; accordingly,
Landlord's acceptance of a partial payment of Rent shall not constitute an
accord and satisfaction of the full amount of the Rent that is due.

         20. LANDLORD'S LIEN. In addition to the statutory landlord's lien,
Tenant grants to Landlord, to secure performance of Tenant's obligations
hereunder, a security interest in all

                                      -16-
<PAGE>   27

goods (including equipment and inventory), fixtures, and other personal property
of Tenant situated on the Premises, and all proceeds thereof (the "COLLATERAL"),
and the Collateral shall not be removed from the Premises without the prior
written consent of Landlord (other than in Tenant's ordinary course of business)
until all obligations of Tenant have been fully performed. Upon the occurrence
of an Event of Default, Landlord may, in addition to all other remedies, without
notice or demand except as provided below, exercise the rights afforded to a
secured party under the Uniform Commercial Code of the state in which the
Premises are located (the "UCC"). To the extent the UCC requires Landlord to
give to Tenant notice of any act or event and such notice cannot be validly
waived before a default occurs, then five (5) days' prior written notice thereof
shall be reasonable notice of the act or event. Tenant grants to Landlord a
power of attorney to execute and file any financing statement or other
instrument necessary to perfect Landlord's security interest under this Section
20, which power is coupled with an interest and is irrevocable during the Term.
Landlord may also file a copy of this Lease as a financing statement to perfect
its security interest in the Collateral.

         21. SURRENDER OF PREMISES. No act by Landlord shall be deemed an
acceptance of a surrender of the Premises, and no agreement to accept a
surrender of the Premises shall be valid unless it is in writing and signed by
Landlord. At the expiration or termination of this Lease, Tenant shall deliver
to Landlord the Premises with all improvements located therein in good repair
and condition, free of Hazardous Materials placed on the Premises during the
Term, broom-clean, reasonable wear and tear (and condemnation and Casualty
damage not caused by Tenant, as to which Sections 14 and 15 shall control)
excepted, and shall deliver to Landlord all keys to the Premises. Provided that
Tenant has performed all of its obligations hereunder, Tenant may remove all
unattached trade fixtures, furniture, and personal property placed in the
Premises or elsewhere in the Building by Tenant (but Tenant may not remove any
such item which was paid for, in whole or in part, by Landlord or any wiring or
cabling unless Landlord requires such removal). Additionally, at Landlord's
option, Tenant shall remove such alterations, additions, improvements, trade
fixtures, personal property, equipment, wiring, cabling, and furniture as
Landlord may request; however, Tenant shall not be required to remove any
addition or improvement to the Premises if Landlord has specifically agreed in
writing that the improvement or addition in question need not be removed. Tenant
shall repair all damage caused by such removal. All items not so removed shall,
at Landlord's option, be deemed to have been abandoned by Tenant and may be
appropriated, sold, stored, destroyed, or otherwise disposed of by Landlord
without notice to Tenant and without any obligation to account for such items;
any such disposition shall not be considered a strict foreclosure or other
exercise of Landlord's rights in respect of the security interest granted under
Section 20. The provisions of this Section 21 shall survive the end of the Term.

         22. HOLDING OVER. If Tenant fails to vacate the Premises at the end of
the Term, then Tenant shall be a tenant at will and, in addition to all other
damages and remedies to which Landlord may be entitled for such holding over,
Tenant shall pay, in addition to the other Rent, a daily Basic Rent equal to the
greater of (a) one hundred fifty percent (150%) of the daily Basic Rent payable
during the last month of the Term, or (b) one hundred twenty-five percent (125%)
of the prevailing rental rate in the Building for similar space. The provisions
of this Section 22 shall not be deemed to limit or constitute a waiver of any
other rights or remedies of Landlord provided herein or at law. If Tenant fails
to surrender the Premises upon the termination or

                                      -17-
<PAGE>   28

expiration of this Lease, in addition to any other liabilities to Landlord
accruing therefrom, Tenant shall protect, defend, indemnify and hold Landlord
harmless from all loss, costs (including reasonable attorney fees) and liability
resulting from such failure, including, without limiting the generality of the
foregoing, any claims made by any succeeding tenant founded upon such failure to
surrender, and any lost profits to Landlord resulting therefrom.

         23. CERTAIN RIGHTS RESERVED BY LANDLORD. Provided that the exercise of
such rights does not unreasonably interfere with Tenant's occupancy of the
Premises, Landlord shall have the following rights:

             23.1 To decorate and to make inspections, repairs, alterations,
additions, changes, or improvements, whether structural or otherwise, in and
about the Building, or any part thereof, to enter upon the Premises (after
giving Tenant reasonable notice thereof, which may be oral notice, except in
cases of real or apparent emergency, in which case no notice shall be required)
and, during the continuance of any such work, to temporarily close doors,
entryways, public space, and corridors in the Building; to interrupt or
temporarily suspend Building services and facilities; to change the name of the
Building; and to change the arrangement and location of entrances or
passageways, doors, and doorways, corridors, elevators, stairs, restrooms, or
other public parts of the Building;

             23.2 To take such reasonable measures as Landlord deems advisable
for the security of the Building and its occupants; evacuating the Building for
cause, suspected cause, or for drill purposes; temporarily denying access to the
Building; and closing the Building after normal business hours and on Sundays
and holidays, subject, however, to Tenant's right to enter when the Building is
closed after normal business hours under such reasonable regulations as Landlord
may prescribe from time to time; and

             23.3 To enter the Premises at reasonable hours to show the Premises
to prospective purchasers, lenders, or, during the last twelve (12) months of
the Term, tenants.

         24. SUBSTITUTION SPACE. Landlord may, at Landlord's expense, relocate
Tenant within the Building to space which is comparable in size, utility and
condition to the Premises. If Landlord relocates Tenant, Landlord shall
reimburse Tenant for Tenant's reasonable out-of-pocket expenses for moving
Tenant's furniture, equipment, and supplies from the Premises to the relocation
space and for reprinting Tenant's stationery of the same quality and quantity as
Tenant's stationery supply on hand immediately before Landlord's notice to
Tenant of the exercise of this relocation right. Upon such relocation, the
relocation space shall be deemed to be the Premises and the terms of the Lease
shall remain in full force and shall apply to the relocation space.

         25. MISCELLANEOUS.

             25.1 LANDLORD TRANSFER. Landlord may transfer any portion of the
Building and any of its rights under this Lease. If Landlord assigns its rights
under this Lease, then Landlord shall thereby be released from any further
obligations hereunder arising after the date of transfer, provided that the
assignee assumes Landlord's obligations hereunder in writing.

                                      -18-
<PAGE>   29

             25.2 LANDLORD'S LIABILITY. The liability of Landlord to Tenant for
any default by Landlord under the terms of this Lease shall be limited to
Tenant's actual direct, but not consequential, damages therefor and shall be
recoverable only from the interest of Landlord in the Building, and neither
Landlord nor its partners shall be personally liable for any deficiency. This
Section shall not limit any remedies which Tenant may have for Landlord's
defaults which do not involve the personal liability of Landlord.

             25.3 FORCE MAJEURE. Other than for Tenant's obligations under this
Lease that can be performed by the payment of money (e.g., payment of Rent and
maintenance of insurance), whenever a period of time is herein prescribed for
action to be taken by either party hereto, such party shall not be liable or
responsible for, and there shall be excluded from the computation of any such
period of time, any delays due to strikes, riots, acts of God, shortages of
labor or materials, war, governmental laws, regulations, or restrictions, or any
other causes of any kind whatsoever which are beyond the control of such party.

             25.4 BROKERAGE. Neither Landlord nor Tenant has dealt with any
broker or agent in connection with the negotiation or execution of this Lease,
other than Landlord's Broker (CPS, The Commercial Property Services Company-M.
McSwain/M. White), and Tenant's Broker (Cornish & Carey-C. Sahadi/D. Hunter/J.
Rodgers), whose commission shall be paid by Landlord pursuant to a separate
agreement. Tenant and Landlord shall each indemnify the other against all costs,
expenses, attorney fees, and other liability for commissions or other
compensation claimed by any broker or agent claiming the same by, through, or
under the indemnifying party.

             25.5 ESTOPPEL CERTIFICATES. From time to time, Tenant shall furnish
to any party designated by Landlord, within ten (10) days after Landlord has
made a request therefor, a certificate signed by Tenant confirming and
containing such factual certifications and representations as to this Lease as
Landlord may reasonably request. Unless otherwise required by Landlord's
Mortgagee or a prospective purchaser or mortgagee of the Building, the initial
form of estoppel certificate to be signed by tenant is attached hereto as
Exhibit F.

             25.6 NOTICES. All notices and other communications given pursuant
to this Lease shall be in writing and shall be (1) mailed by first class, United
States Mail, postage prepaid, certified, with return receipt requested, and
addressed to the parties hereto at the address specified in the Basic Lease
Information, (2) hand delivered to the intended address, (3) sent by a
nationally recognized overnight courier service, or (4) sent by facsimile
transmission during normal business hours followed by a confirmatory letter sent
in another manner permitted hereunder. All notices shall be effective upon
delivery to the address of the addressee. The parties hereto may change their
addresses by giving notice thereof to the other in conformity with this
provision.

             25.7 SEPARABILITY. If any clause or provision of this Lease is
illegal, invalid, or unenforceable under present or future laws, then the
remainder of this Lease shall not be affected thereby and in lieu of such clause
or provision, there shall be added as a part of this Lease a clause or provision
as similar in terms to such illegal, invalid, or unenforceable clause or
provision as may be possible and be legal, valid, and enforceable.

                                      -19-
<PAGE>   30

             25.8 AMENDMENTS, AND BINDING EFFECT. This Lease may not be amended
except by instrument in writing signed by Landlord and Tenant. No provision of
this Lease shall be deemed to have been waived by Landlord unless such waiver is
in writing signed by Landlord, and no custom or practice which may evolve
between the parties in the administration of the terms hereof shall waive or
diminish the right of Landlord to insist upon the performance by Tenant in
strict accordance with the terms hereof. The terms and conditions contained in
this Lease shall inure to the benefit of and be binding upon the parties hereto,
and upon their respective successors in interest and legal representatives,
except as otherwise herein expressly provided. This Lease is for the sole
benefit of Landlord and Tenant, and, other than Landlord's Mortgagee, no third
party shall be deemed a third party beneficiary hereof

             25.9 QUIET ENJOYMENT. Provided Tenant has performed all of its
obligations hereunder, Tenant shall peaceably and quietly hold and enjoy the
Premises for the Term, without hindrance from Landlord or any party claiming by,
through, or under Landlord, but not otherwise, subject to the terms and
conditions of this Lease.

             25.10 NO MERGER. There shall be no merger of the leasehold estate
hereby created with the fee estate in the Premises or any part thereof if the
same person acquires or holds, directly or indirectly, this Lease or any
interest in this Lease and the fee estate in the leasehold Premises or any
interest in such fee estate.

             25.11 NO OFFER. The submission of this Lease to Tenant shall not be
construed as an offer, and Tenant shall not have any rights under this Lease
unless Landlord executes a copy of this Lease and delivers it to Tenant.

             25.12 ENTIRE AGREEMENT. This Lease constitutes the entire agreement
between Landlord and Tenant regarding the subject matter hereof and supersedes
all oral statements and prior writings relating thereto. Except for those set
forth in this Lease, no representations, warranties, or agreements have been
made by Landlord or Tenant to the other with respect to this Lease or the
obligations of Landlord or Tenant in connection therewith. The normal rule of
construction that any ambiguities be resolved against the drafting party shall
not apply to the interpretation of this Lease or any exhibits or amendments
hereto.

             25.13 WAIVER OF JURY TRIAL. To the maximum extent permitted by law,
Landlord and Tenant each waive right to trial by jury in any litigation arising
out of or with respect to this Lease.

             25.14 GOVERNING LAW. This Lease shall be governed by and construed
in accordance with the laws of the State in which the Premises are located.

             25.15 JOINT AND SEVERAL LIABILITY. If Tenant is comprised of more
than one party, each such party shall be jointly and severally liable for
Tenant's obligations under this Lease.

             25.16 FINANCIAL REPORTS. Within fifteen (15) days after Landlord's
request, Tenant will furnish Tenant's most recent audited financial statements
(including any notes to

                                      -20-
<PAGE>   31

them) to Landlord, or, if no such audited statements have been prepared, such
other financial statements (and notes to them) as may have been prepared by an
independent certified public accountant or, failing those, Tenant's internally
prepared financial statements. If Tenant is a publicly traded corporation,
Tenant may satisfy its obligations hereunder by providing to Landlord Tenant's
most recent annual and quarterly reports. Tenant will discuss its financial
statements with Landlord and will give Landlord access to Tenant's books and
records in order to enable Landlord to verify the financial statements. Landlord
will not disclose any aspect of Tenant's financial statements that Tenant
designates to Landlord as confidential except (1) to Landlord's Mortgagee or
prospective purchasers of the Building, (2) in litigation between Landlord and
Tenant, or (3) if required by court order. Tenant shall not be required to
deliver the financial statements required under this Section 25.16 more than
once in any twelve (12) month period unless requested by Landlord's Mortgagee or
a prospective buyer or lender of the Building or an Event of Default occurs.

             25.17 LANDLORD'S FEES. Whenever Tenant requests Landlord to take
any action not required of it hereunder or give any consent required or
permitted under this Lease, Tenant will reimburse Landlord for Landlord's
reasonable, out-of-pocket costs payable to third parties and incurred by
Landlord in reviewing the proposed action or consent, including without
limitation reasonable attorney, engineers' or architects' fees, within ten (10)
days after Landlord's delivery to Tenant of a statement of such costs. Tenant
will be obligated to make such reimbursement without regard to whether Landlord
consents to any such proposed action.

             25.18 ATTORNEY FEES. In the event that either Landlord or Tenant
should bring suit for the possession of the Premises, for the recovery of any
sum due under this Lease, or because of the breach of any provision of this
Lease or for any other relief against the other, then all costs and expenses,
including reasonable attorney fees, incurred by the prevailing party therein
shall be paid by the other party, which obligation on the part of the other
party shall be deemed to have accrued on the date of the commencement of such
action and shall be enforceable whether or not the action is prosecuted to
judgment.

             25.19 TELECOMMUNICATIONS. Tenant and its telecommunications
companies, including but not limited to local exchange telecommunications
companies and alternative access vendor services companies shall have no right
of access to and within the Building, for the installation and operation of
telecommunications systems including but not limited to voice, video, data, and
any other telecommunications services provided over wire, fiber optic,
microwave, wireless, and any other transmission systems, for part or all of
Tenant's telecommunications within the Building and from the Building to any
other location without Landlord's prior written consent.

             25.20 CONFIDENTIALITY. Tenant acknowledges that the terms and
conditions of this Lease are to remain confidential for Landlord's benefit, and
may not be disclosed by Tenant to anyone, by any manner or means, directly or
indirectly, without Landlord's prior written consent. The consent by Landlord to
any disclosures shall not be deemed to be a waiver on the part of Landlord of
any prohibition against any future disclosure.

                                      -21-
<PAGE>   32

             25.21 HAZARDOUS MATERIALS. The term "HAZARDOUS MATERIALS" means any
substance, material, or waste which is now or hereafter classified or considered
to be hazardous, toxic, or dangerous under any Law relating to pollution or the
protection or regulation of human health, natural resources or the environment,
or poses or threatens to pose a hazard to the health or safety of persons on the
Premises or in the Building. Tenant shall not use, generate, store, or dispose
of, or permit the use, generation, storage or disposal of Hazardous Materials on
or about the Premises or the Building except in a manner and quantity necessary
for the ordinary performance of Tenant's business, and then in compliance with
all Laws. If Tenant breaches its obligations under this Section 25.21, Landlord
may immediately take any and all action reasonably appropriate to remedy the
same, including taking all appropriate action to clean up or remediate any
contamination resulting from Tenant's use, generation, storage or disposal of
Hazardous Materials. Tenant shall protect, defend, indemnify and hold harmless
Landlord and its representatives and agents from and against any and all claims,
demands, liabilities, causes of action, suits, judgments, damages and expenses
(including reasonable attorney fees and cost of clean up and remediation)
arising from Tenant's failure to comply with the provisions of this Section
25.21. This indemnity provision shall survive termination or expiration of the
Lease.

             25.22 SIGNAGE. Tenant shall not erect or maintain any temporary or
permanent sign on or about the Premises or the Building or visible from the
exterior without obtaining prior written approval from Landlord, which may be
granted or withheld in Landlord's sole and absolute discretion. Any request for
approval of a sign shall be made in such detail as Landlord shall request. All
signs, whether erected by Landlord or Tenant, shall conform to Landlord's
building standard signage and to all laws, ordinances, rules, regulations,
permits, covenants, conditions, restrictions, and easements pertaining to signs.
In the event of a violation of the foregoing by Tenant, Landlord may remove same
without any liability, and may charge the expense incurred in such removal to
Tenant. Tenant shall remove all approved signs which it has erected upon the
termination of the Lease and repair all damage caused by such removal.

             25.23 PARKING. Tenant shall have the right to rent eighteen (18)
undesignated parking spaces in the parking garage/area associated with the
Building (the "PARKING AREA") during the initial term at such rates and subject
to such terms, conditions and regulations as are from time to time charged or
applicable to patrons of the Parking Area. If, for any reason, Tenant is unable
to use all or any portion of the parking spaces to which it is entitled
hereunder, then Tenant's obligation to pay for such spaces shall be abated for
so long as Tenant does not have the use thereof; this abatement shall be in full
settlement of all claims that Tenant might otherwise have against Landlord
because of Landlord's failure or inability to provide Tenant with such parking
spares.

             25.24 LIST OF EXHIBITS. All exhibits and attachments attached
hereto are incorporated herein by this reference.

             Exhibit A         Outline of Premises
             Exhibit B         Legal Description of Building
             Exhibit C         Building Rules and Regulations
             Exhibit D         Tenant Finish-Work
             Exhibit E         Amendment No. 1

                                      -22-

<PAGE>   33
             Exhibit F         Form of Tenant Estoppel Certificate
             Exhibit G         Depiction of Offer Space

         26. RENEWAL OPTION.

             26.1 GRANT OF OPTIONS. Provided no Event of Default exists and
Tenant is occupying the entire Premises at the time of such election, Tenant may
renew this Lease for one (1) additional period of forty-eight (48) months, by
delivering written notice of the exercise thereof to Landlord not earlier than
nine (9) months nor later than six (6) months before the expiration of the
initial term.

             26.2 BASIC RENT. The Basic Rent payable for each month during such
extended Term shall be the prevailing rental rate (the "PREVAILING RENTAL
RATE"), at the commencement of such extended Term, for renewals of space of
equivalent quality, size, utility and location, with the length of the extended
Term and the credit standing of Tenant to be taken into account. Within thirty
(30) days after receipt of Tenant's notice to renew, Landlord shall deliver to
Tenant written notice of the Prevailing Rental Rate and shall advise Tenant of
the required adjustment to Basic Rent, if any, and the other terms and
conditions offered. Tenant shall, within ten (10) days after receipt of
Landlord's notice, notify Landlord in writing whether Tenant accepts or rejects
Landlord's determination of the Prevailing Rental Rate. If Tenant timely
notifies Landlord that Tenant accepts Landlord's determination of the Prevailing
Rental Rate, then, on or before the commencement date of the extended Term,
Landlord and Tenant shall execute an amendment to this Lease extending the Term
on the same terms provided in this Lease, except as follows:

                  (a) Basic Rent shall be adjusted to the Prevailing Rental
         Rate;

                  (b) Tenant shall have no further renewal option unless
         expressly granted by Landlord in writing; and

                  (c) Landlord shall lease to Tenant the Premises in their
         then-current condition, and Landlord shall not provide to Tenant any
         allowances (e.g., moving allowance, construction allowance, and the
         like) or other tenant inducements.

             If Tenant rejects Landlord's determination of the Prevailing Rental
Rate, or fails to timely notify Landlord in writing that Tenant accepts or
rejects Landlord's determination of the Prevailing Rental Rate, time being of
the essence with respect thereto, Tenant's rights under this Section 26 shall
terminate and Tenant shall have no right to renew this Lease.

             26.3 TERMINATION OF OPTION. Tenant's rights under this Section 26
shall terminate if (1) this Lease or Tenant's night to possession of the
Premises is terminated, (2) Tenant assigns any of its interest in this Lease or
sublets any portion of the Premises, (3) Tenant fails to timely exercise its
option under this Section 26, time being of the essence with respect to Tenant's
exercise thereof, or (4) Landlord determines, in its sole but reasonable
discretion, that Tenant's financial condition or creditworthiness has materially
deteriorated since the date of this Lease.

                                      -23-
<PAGE>   34

         27. RIGHT OF FIRST OFFER.

             27.1 DEFINITIONS. As used herein:

                  27.1.1 "AVAILABLE FOR LEASE" means, with respect to any First
Right Space, that Landlord is prepared to offer such First Right Space for lease
in the general leasing market, regardless of the proposed commencement date of
such lease.

                  27.1.2 "FIRST RIGHT SPACE" means the space located on that
portion of the thirteenth (13th) floor of the Building shown cross hatched on
Exhibit G.

             27.2 FIRST RIGHT SPACE. Provided that this Lease is in full force
and Tenant is not in default hereunder, and subject to any options, rights of
first refusal or rights of first offer already in existence as of the date of
full execution of this Lease and to Section 27.3, if, during the Term, any First
Right Space shall become Available for Lease, Landlord shall, prior to offering
such First Right Space to any other person, deliver to Tenant a notice (a "FIRST
RIGHT AVAILABILITY NOTICE") (a) stating that Landlord intends to offer such
First Right Space for lease and (b) describing such First Right Space and the
material business terms at which Landlord intends to market such space. If
Tenant shall deliver to Landlord a notice (a "TENANT'S INTEREST NOTICE") that it
desires to engage in negotiations with Landlord regarding the leasing of such
First Right Space within four (4) business days after receipt of the First Right
Availability Notice, then for fifteen (15) days (the "NEGOTIATION PERIOD") after
Tenant so notifies Landlord, Landlord shall negotiate exclusively with Tenant to
enter into a lease or a lease amendment under which Landlord would lease such
First Right Space to Tenant; provided, however, that neither Tenant nor Landlord
shall have any obligation to agree to any provision or term with respect to such
lease or lease amendment. If Tenant does not timely deliver to Landlord a
Tenant's Interest Notice in response to a First Right Availability Notice in
accordance with this Section 27.2, or if an agreement for the leasing of such
First Right Space is not executed and delivered by Landlord and Tenant within
the Negotiation Period, time being of the essence, then (i) Tenant shall have
waived and relinquished its rights under this Section 27.2 with respect to the
First Right Space described in such First Right Availability Notice, and (ii)
Landlord shall at any time thereafter be entitled to offer, show, market and
lease such First Right Space to all others selected by Landlord at such rental
rates and upon such terms as Landlord in its sole discretion may desire.

             27.3 MISCELLANEOUS. Notwithstanding any provision of this Section
27 to the contrary, Tenant shall have no right to give a Tenant's Interest
Notice on any date on which Tenant (a) is in default under this Lease beyond any
applicable grace, notice and cure period, or (b) has assigned any of its
interest in this Lease or sublet any portion of the Premises. At any time when
Tenant (1) is so in default under this Lease, or (ii) has assigned or sublet any
portion of the Premises, Landlord may cancel a Tenant's Interest Notice by
notice to Tenant, and on and after the date of such notice to Tenant, Tenant
shall have no rights, and Landlord shall have no obligations, under this Section
27 with respect to the First Right Space.

             27.4 NO EXTENSION. The period of time within which Tenant may
exercise the Right of First Offer granted in this Section 27 shall not be
extended or enlarged by reason of

                                      -24-
<PAGE>   35

Tenant's inability to exercise such Right of First Offer because of the
provisions of Section 27.3 above.

             27.5 TERMINATION. The expiration or termination of this Lease shall
automatically terminate Tenant's Right of First Offer with respect to the First
Right Space.

LANDLORD AND TENANT EXPRESSLY DISCLAIM ANY IMPLIED WARRANTY THAT THE PREMISES
ARE SUITABLE FOR TENANT'S INTENDED COMMERCIAL PURPOSE, AND TENANT'S OBLIGATION
TO PAY RENT HEREUNDER IS NOT DEPENDENT UPON THE CONDITION OF THE PREMISES OR THE
PERFORMANCE BY LANDLORD OF ITS OBLIGATIONS HEREUNDER, AND, EXCEPT AS OTHERWISE
EXPRESSLY PROVIDED HEREIN, TENANT SHALL CONTINUE TO PAY THE RENT, WITHOUT
ABATEMENT, SETOFF OR DEDUCTION, NOTWITHSTANDING ANY BREACH BY LANDLORD OF ITS
DUTIES OR OBLIGATIONS HEREUNDER, WHETHER EXPRESS OR IMPLIED.

         Dated as of the date first above written.

TENANT:                                    SYNCHRONICITY, INC., a Massachusetts
                                           corporation

                                           By: _________________________________
                                           Name: _______________________________
                                           Title: ______________________________

                                           By: _________________________________
                                           Name: _______________________________
                                           Title: ______________________________

LANDLORD:                                  W9/PHC REAL ESTATE LIMITED
                                           PARTNERSHIP, a Delaware limited
                                           partnership

                                           By:  W9/PHC GEN PAR, INC., a Delaware
                                                 corporation, General Partner

                                           By: _________________________________
                                           Name: Howard Stern
                                           Title: Assistant Vice President

                                      -25-
<PAGE>   36

                                    EXHIBIT A

                               OUTLINE OF PREMISES

<PAGE>   37

                                    EXHIBIT B

                          LEGAL DESCRIPTION OF BUILDING

PARCEL ONE:

PARCEL A, AS SHOWN ON THAT CERTAIN PARCEL MAP FILED IN THE OFFICE OF THE
RECORDER OF THE COUNTY OF SANTA CLARA, STATE OF CALIFORNIA ON MAY 7, 1985 IN
BOOK 542 OF MAPS, AT PAGES 46 AND 47.

PARCEL TWO:

A NON-EXCLUSIVE EASEMENT FOR INGRESS AND EGRESS OVER PARCEL C, AS SHOWN ON THAT
CERTAIN PARCEL MAP FILED IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SANTA
CLARA, STATE OF CALIFORNIA ON MAY 7, 1985 IN BOOK 542 OF MAPS, AT PAGE 46
AND 47.

<PAGE>   38

                                    EXHIBIT C

                         BUILDING RULES AND REGULATIONS

         The following rules and regulations shall apply to the Premises, the
Building, the parking garage associated therewith, and the appurtenances
thereto:

         1. Sidewalks, doorways, vestibules, halls, stairways, and other similar
areas shall not be obstructed by tenants or used by any tenant for purposes
other than ingress and egress to and from their respective leased premises and
for going from one to another part of the Building.

         2. Plumbing, fixtures and appliances shall be used only for the
purposes for which designed, and no sweepings, rubbish, rags or other unsuitable
material shall be thrown or deposited therein. Damage resulting to any such
fixtures or appliances from misuse by a tenant or its agents, employees or
invitees, shall be paid by such tenant.

         3. No signs, advertisements or notices shall be painted or affixed on
or to any windows or doors or other part of the Building without the prior
written consent of Landlord. No nails, hooks or screws shall be driven or
inserted in any part of the Building except by Building maintenance personnel.
No curtains or other window treatments shall be placed between the glass and the
Building standard window treatments.

         4. Landlord shall provide and maintain an alphabetical directory for
all tenants in the main lobby of the Building.

         5. Landlord shall provide all door locks in each tenant's leased
premises, at the cost of such tenant, and no tenant shall place any additional
door locks in its leased premises without Landlord's prior written consent.
Landlord shall furnish to each tenant a reasonable number of keys to such
tenant's leased premises, at such tenant's cost, and no tenant shall make a
duplicate thereof.

         6. Movement in or out of the Building of furniture or office equipment,
or dispatch or receipt by tenants of any bulky material, merchandise or
materials which require use of elevators or stairways, or movement through the
Building entrances or lobby shall be conducted under Landlord's supervision at
such times and in such a manner as Landlord may reasonably require. Each tenant
assumes all risks of and shall be liable for all damage to articles moved and
injury to persons or public engaged or not engaged in such movement, including
equipment, property and personnel of Landlord if damaged or injured as a result
of acts in connection with carrying out this service for such tenant.

         7. Landlord may prescribe weight limitations and determine the
locations for safes and other heavy equipment or items, which shall in all cases
be placed in the Building so as to distribute weight in a manner acceptable to
Landlord which may include the use of such supporting devices as Landlord may
require. All damages to the Building caused by the installation or removal of
any property of a tenant, or done by a tenant's property while in the Building,
shall be repaired at the expense of such tenant.

<PAGE>   39

         8. Corridor doors, when not in use, shall be kept closed. Nothing shall
be swept or thrown into the corridors, halls, elevator shafts or stairways. No
birds or animals shall be brought into or kept in, on or about any tenant's
leased premises. No portion of any tenant's leased premises shall at any time be
used or occupied as sleeping or lodging quarters.

         9. Tenant shall cooperate with Landlord's employees in keeping its
leased premises neat and clean. Tenants shall not employ any person for the
purpose of such cleaning other than the Building's cleaning and maintenance
personnel.

         10. To ensure orderly operation of the Building, no ice, mineral or
other water, towels, newspapers, etc. shall be delivered to any leased area
except by persons approved by Landlord.

         11. Tenant shall not make or permit any vibration or improper,
objectionable or unpleasant noises or odors in the Building or otherwise
interfere in any way with other tenants or persons having business with them.

         12. No machinery of any kind (other than normal office equipment) shall
be operated by any tenant on its leased area without Landlord's prior written
consent, nor shall any tenant use or keep in the Building any flammable or
explosive fluid or substance.

         13. Landlord will not be responsible for lost or stolen personal
property, money or jewelry from tenant's leased premises or public or common
areas regardless of whether such loss occurs when the area is locked against
entry or not.

         14. No vending or dispensing machines of any kind may be maintained in
any leased premises without the prior written permission of Landlord.

         15. Tenant shall not conduct any activity on or about the Premises or
Building which will draw pickets, demonstrators, or the like.

         16. All vehicles are to be currently licensed, in good operating
condition, parked for business purposes having to do with Tenant's business
operated in the Premises, parked within designated parking spaces, one vehicle
to each space. No vehicle shall be parked as a "billboard" vehicle in the
parking lot. Any vehicle parked improperly may be towed away. Tenant, Tenant's
agents, employees, vendors and customers who do not operate or park their
vehicles as required shall subject the vehicle to being towed at the expense of
the owner or driver. Landlord may place a "boot" on the vehicle to immobilize it
and may levy a charge of $50.00 to remove the "boot." Tenant shall indemnify,
hold and save harmless Landlord of any liability arising from the towing or
booting of any vehicles belonging to a Tenant Party.

         17. No tenant may enter into phone rooms, electrical rooms, mechanical
rooms, or other service areas of the Building unless accompanied by Landlord or
the Building manager.

<PAGE>   40

                                    EXHIBIT D

                          TENANT FINISH-WORK; ALLOWANCE
                          [LANDLORD PERFORMS THE WORK]

         1. Except as set forth in this Exhibit, Tenant accepts the Premises in
their "AS-IS" condition on the date that this Lease is entered into.

         2. On or before the date which is fifteen (15) days following the date
on which this Lease is fully executed by both Landlord and Tenant, Landlord
shall engage a design consultant (whose fee shall be included in the Total
Construction Cost [defined below]) to prepare final working drawings of all
improvements to be installed in the Premises and deliver the same to Tenant for
its review and approval (which approval shall not be unreasonably withheld,
delayed or conditioned). Tenant shall notify Landlord whether it approves of the
submitted working drawings within three (3) business days after Landlord's
submission thereof. If Tenant disapproves of such working drawings, then Tenant
shall notify Landlord thereof specifying in reasonable detail the reasons for
such disapproval, in which case Landlord shall, within three (3) business days
after such notice, revise such working drawings in accordance with Tenant's
objections and submit to Tenant for its review and approval. Tenant shall notify
Landlord in writing whether it approves of the resubmitted working drawings
within one business day after its receipt thereof. This process shall be
repeated until the working drawings have been finally approved by Landlord and
Tenant. If Tenant fails to notify Landlord that it disapproves of the initial
working drawings within three (3) business days (or, in the case of resubmitted
working drawings, within one business day) after the submission thereof, then
Tenant shall be deemed to have approved the working drawings in question. Any
delay caused by Tenant's unreasonable withholding of its consent or delay in
giving its written approval as to such working drawings shall constitute Tenant
Delay Day (defined below). To the extent that such working drawings also require
Landlord's approval, Landlord shall also approve such working drawings within
three (3) business days after the architect's submission of such working
drawings to Landlord. Further, if any of Tenant's proposed construction work
will affect the Building's HVAC, electrical, mechanical, or plumbing systems,
then the working drawings pertaining thereto must be approved by the Building's
engineer of record. Landlord's approval of such working drawings shall not be
unreasonably withheld, provided that (a) they comply with all Laws, (b) such
working drawings are sufficiently detailed to allow construction of the
improvements in a good and workmanlike manner, and (e) the improvements depicted
thereon conform to the rules and regulations promulgated from time to time by
Landlord for the construction of tenant improvements (a copy of which has been
delivered to Tenant). As used herein, "WORKING DRAWINGS" shall mean the final
working drawings approved by Landlord, as amended from time to time by any
approved changes thereto, and "WORK" shall mean all improvements to be
constructed in accordance with and as indicated on the Working Drawings,
together with any work required by governmental authorities to be made to other
areas of the Building as a result of the improvements indicated by the Working
Drawings. Landlord's approval of the Working Drawings shall not be a
representation or warranty of Landlord that such drawings are adequate for any
use or comply with any Law, but shall merely be the consent of Landlord thereto.
Tenant shall, at Landlord's request, sign the Working Drawings to evidence its
review and approval
<PAGE>   41

thereof. All changes in the Work must receive the prior written approval of
Landlord, and in the event of any such approved change Tenant shall, upon
completion of the Work, furnish Landlord with an accurate, reproducible
"as-built" plan of the improvements as constructed. After the Working Drawings
have been approved, Landlord shall cause the Work to be performed in accordance
with the Working Drawings.

         3. The Work shall be performed only by contractors and subcontractors
approved in writing by Landlord, which approval shall not be unreasonably
withheld. All contractors and subcontractors shall be required to procure and
maintain insurance against such risks, in such amounts, and with such companies
as Landlord may reasonably require. Certificates of such insurance, with paid
receipts therefor, must be received by Landlord before the Work is commenced.
The Work shall be performed in a good and workmanlike manner free of defects,
shall conform strictly with the Working Drawings, and shall be performed in such
a manner and at such times as and not to interfere with or delay Landlord's
other contractors, the operation of the Building, and the occupancy thereof by
other tenants. All contractors and subcontractors shall contact Landlord and
schedule time periods during which they may use Building facilities in
connection with the Work (e.g., elevators, excess electricity, etc.).

         4. If a delay in the performance of the Work occurs (a) because of any
change by Tenant to the space plans or Working Drawings, (b) because of any
specification by Tenant of materials or installations in addition to or other
than Landlord's standard finish-out materials, or (c) if Tenant or Tenant's
agents otherwise delays completion of the Work, then, notwithstanding any
provision to the contrary in this Lease, Tenant's obligation to pay Rent
hereunder shall commence on the scheduled Commencement Date (each day of delay
caused by any such event shall be a "TENANT DELAY DAY"). If the Premises are not
ready for occupancy and the Work is not substantially completed (as reasonably
determined by Landlord) on the scheduled Commencement Date for any reason other
than the reasons specified in the immediately preceding sentence, then the
obligations of Landlord and Tenant shall continue in full force and Rent shall
be abated until the date the Work is substantially completed less the number of
Tenant Delay Days, which date shall be the Commencement Date.

         5. The entire cost of performing the Work (including, without
limitation, design of the Work and preparation of the Working Drawings, costs of
construction labor and materials, electrical usage during construction,
additional janitorial services, general tenant signage, related taxes and
insurance costs, and the construction supervision fee referenced in Section 7 of
this Exhibit, all of which costs are herein collectively called the "TOTAL
CONSTRUCTION COSTS") in excess of the Construction Allowance (hereinafter
defined) shall be paid by Tenant. Upon approval of the Working Drawings and
selection of a contractor, Tenant shall promptly (a) execute a work order
agreement prepared by Landlord which identifies such drawings and itemizes the
Total Construction Costs and sets forth the Construction Allowance, and (b) pay
to Landlord fifty percent (50%) of the amount by which Total Construction Costs
exceed the Construction Allowance; upon substantial completion of the Work,
Tenant shall pay to Landlord an amount equal to the Total Construction Costs (as
adjusted for any approved changes to the Work), less (1) the amount of the
advance payment already made by Tenant, and (2) the amount of the Construction
Allowance.

<PAGE>   42

         6. For Work completed in the first six (6) months following the
Commencement Date only, Landlord shall provide to Tenant a construction
allowance (the "CONSTRUCTION ALLOWANCE") equal to the lesser of (a) $5.00 per
rentable square foot in the Premises (not to exceed $35,330.00), or (b) the
Total Construction Costs, as adjusted for any approved changes to the Work;
however, if Tenant or its agent is managing the performance of the Work, then
Tenant shall not become entitled to full credit for the Construction Allowance
until the Work has been substantially completed and Tenant has caused to be
delivered to Landlord (1) all invoices from contractors, subcontractors, and
suppliers evidencing the cost of performing the Work, together with lien waivers
from such parties, and a consent of the surety to the finished Work (if
applicable) and (2) a certificate of occupancy from the appropriate governmental
authority, if applicable to the Work, or evidence of governmental inspection and
approval of the Work. Landlord shall have no obligation to pay the Construction
Allowance to Tenant for any portion of the Work completed after the date which
is six (6) months after the Commencement Date, and Tenant shall present all such
invoices, lien waivers and a certificate of occupancy, if applicable, before
such six (6) month date in order for same to be eligible for payment from the
Construction Allowance.

         7. Landlord or its affiliate or agent shall supervise the Work, make
disbursements required to be made to the contractor, and act as a liaison
between the contractor and Tenant and coordinate the relationship between the
Work, the Building, and the Building's systems. In consideration for Landlord's
construction supervision services, Tenant shall pay to Landlord a construction
supervision fee equal to five percent (5%) of the Total Construction Costs.

         8. To the extent not inconsistent with this Exhibit, Section 8.1 of
this Lease shall govern the performance of the Work and Landlord's and Tenant's
respective rights and obligations regarding the improvements installed pursuant
thereto.

<PAGE>   43

                                    EXHIBIT E

                                 AMENDMENT NO. 1

         This Amendment No. 1 (this "AMENDMENT") is executed as of
_______________, 200_ between W9/PHC REAL ESTATE LIMITED PARTNERSHIP, a Delaware
limited partnership ("LANDLORD"), and SYNCHRONICITY, INC., a Massachusetts
corporation ("TENANT"), for the purpose of amending the Lease Agreement between
Landlord and Tenant dated November 18, 1998 (the "LEASE"). Capitalized terms
used herein but not defined shall be given the meanings assigned to them in the
Lease.

                                   AGREEMENTS

         For valuable consideration, whose receipt and sufficiency are
acknowledged, Landlord and Tenant agree as follows:

         1. CONDITION OF PREMISES. Tenant has accepted possession of the
Premises pursuant to the Lease. Any improvements required by the terms of the
Lease to be made by Landlord have been completed to the full and complete
satisfaction of Tenant in all respects except for the punch list items described
on EXHIBIT A hereto (the "PUNCH LIST ITEMS"), and except for such Punch List
Items, Landlord has fulfilled all of its duties under the Lease with respect to
such initial tenant improvements. Furthermore, Tenant acknowledges that the
Premises are suitable for the Permitted Use.

         2. COMMENCEMENT DATE. The Commencement Date of the Lease is
________________, 200_. If the Commencement Date set forth in the Lease is
different than the date set forth in the preceding sentence, then the
Commencement Date as contained in the Lease is amended to be the Commencement
Date set forth in the preceding sentence.

         3. EXPIRATION DATE. The Term is scheduled to expire on
________________, 200_. If the scheduled expiration date of the initial Term as
set forth in the Lease is different than the date set forth in the preceding
sentence, then the scheduled expiration date as set forth in the Lease is hereby
amended to the expiration date set forth in the preceding sentence.

         4. CONTACT NUMBERS. Tenant's telephone number in the Premises is
__________. Tenant's telecopy number in the Premises is ___________.

         5. RATIFICATION. Tenant hereby ratifies and confirms its obligations
under the Lease, and represents and warrants to Landlord that it has no defenses
thereto. Additionally, Tenant further confirms and ratifies that, as of the date
hereof, the Lease is and remains in good standing and in full force and effect,
and Tenant has no claims, counterclaims, setoffs or defenses against Landlord
arising out of the Lease or in any way relating thereto or arising out of any
other transaction between Landlord and Tenant.

         6. BINDING EFFECT; GOVERNING LAW. Except as modified hereby, the Lease
shall remain in full effect and this Amendment shall be binding upon Landlord
and Tenant and their
<PAGE>   44

respective successors and assigns. If any inconsistency exists or arises between
the terms of this Amendment and the terms of the Lease, the terms of this
Amendment shall prevail. This Amendment shall be governed by the laws of the
State in which the Premises is located.

         7. COUNTERPARTS. This Amendment may be executed in multiple
counterparts, each of which shall constitute an original, but all of which shall
constitute one document.

         Executed as of the date first written above.

TENANT:                                  SYNCHRONICITY, INC., a Massachusetts
                                         corporation

                                         By: ___________________________________
                                         Name: _________________________________
                                         Title: ________________________________

                                         By: ___________________________________
                                         Name: _________________________________
                                         Title: ________________________________

LANDLORD:                                W9/PHC REAL ESTATE LIMITED PARTNERSHIP,
                                         a Delaware limited partnership

                                         By:  W9/PHC GEN-PAR, INC., a Delaware
                                              corporation, General Partner

                                         By: ___________________________________
                                         Name: Nancy M. Haag
                                         Title: Assistant Vice President

<PAGE>   45

                          EXHIBIT A TO AMENDMENT NO. 1

                                PUNCH LIST ITEMS

<PAGE>   46

                                    EXHIBIT F

                       FORM OF TENANT ESTOPPEL CERTIFICATE

         The undersigned is the Tenant under the Lease (Defined below) between
W9/PHC REAL ESTATE LIMITED PARTNERSHIP, a Delaware limited partnership, as
Landlord, and the undersigned as Tenant, for the Premises on the thirteenth
floor of the office building located at 160 West Santa Clara Street, San Jose,
California, 95113, and commonly known as 160 West Santa Clara Street, and hereby
certifies as follows:

         1. The Lease consists of the original Lease Agreement dates as of
November 18, 1998 between Tenant and Landlord and the following amendments or
modifications thereto (if none, please state "none"):__________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
The documents listed above are herein collectively referred to as the "LEASE"
and represent the entire agreement between the parties with respect to the
Premises. All capitalized terms used herein but not defined shall be given the
meaning assigned to them in the Lease.

         2. The Lease is in full force and effect and has not been modified,
supplemented or amended in any way except as provided in Section 1 above.

         3. The Term commenced on __________________, 199_ and the Term expires,
excluding any renewal options, on _____________, 200_, and Tenant has no option
to purchase all or any part of the Premises or the Building or, except as
expressly set forth in the Lease, any option to terminate or cancel the Lease.

         4. Tenant currently occupies the Premises described in the Lease and
Tenant has not transferred, assigned, or sublet any portion of the Premises nor
entered into any license or concession agreements with respect thereto except as
follows (if none, please state "none"): _______________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________

         5. All monthly installments of Basic Rent and Additional Rent has been
paid with due through ______________. The current monthly installment of Basic
Rent is $________.

         6. All conditions of the Lease to be performed by Landlord necessary to
the enforceability of the Lease have been satisfied and Landlord is not in
default thereunder. In addition, Tenant has not delivered any notice to Landlord
regarding a default by Landlord thereunder.

         7. As of the date hereof, there are no existing defenses or offsets,
or, to the undersigned's knowledge, claims or any basis for a claim, that the
undersigned has against
<PAGE>   47

Landlord and no event has occurred and no condition exists, which, with the
giving of notice or the passage of time, or both, will constitute a default
under the Lease.

         8. No rental has been paid more than thirty (30) days in advance and no
security deposit has been delivered to Landlord except as provided in the Lease.

         9. If Tenant is a corporation, partnership or other business entity,
each individual executing this Estoppel Certificate on behalf of Tenant hereby
represents and warrants that Tenant is a duly formed and existing entity
qualified to do business in the state in which the Premises is located and that
Tenant has full right and authority to execute and deliver this Estoppel
Certificate and that each person signing on behalf of Tenant is authorized to do
so.

<PAGE>   48

                                    EXHIBIT G

                            DEPICTION OF OFFER SPACE

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