Document:

EXHIBIT 4.1

Contacts:    P.A. Murali, CFO  (707) 463-6610              For Immediate Release
             Yashpal Singh, President  (707) 463-2087

                                  News Release

     MENDOCINO BREWING COMPANY ANNOUNCES INTENT TO ACQUIRE UBSN LTD. UK, THE
         EUROPEAN DISTRIBUTOR OF KINGFISHER PREMIUM LAGER, AND THE U.S.
                 DISTRIBUTION RIGHTS TO KINGFISHER PREMIUM LAGER

Ukiah,  California,  March 29, 2000. Mendocino Brewing Company,  Inc. (PSE: MBR)
announced today that it intends to enter into two  transactions  with affiliates
of its largest shareholder, United Breweries of America Inc.

In the first transaction, Mendocino Brewing Company intends to acquire UBSN Ltd.
UK,  which  is  the  European  distributor  of the UB  Group's  flagship  brand,
Kingfisher Premium Lager. In the second  transaction,  Mendocino Brewing Company
announced  that it intends  to acquire  the  distribution  rights to  Kingfisher
Premium Lager Beer in the United States from United Breweries International,  UK
Ltd. ("UBI, UK Ltd.")

The two  transactions  are  expected  to be  finalized  by the end of May  2000,
subject to the necessary due diligence and regulatory approvals. Once completed,
the  acquisitions  will provide  Mendocino  Brewing  Company with the  exclusive
rights to distribute Kingfisher Premium Lager Beer in the United States.

In 1999, UBSN's U.S. dollar equivalent  revenues were $12.4 million and earnings
before  taxes  were  $314,500 (computed at $1.70 to  (UK lb.) 1.00).  UBSN  Ltd.
distributed approximately 47,500 barrels of beer in 1999; 80%, of which was sold
in the  United  Kingdom;  the  balance  was sold in Europe,  the United  States,
Canada, and Japan.

Dr. Vijay Mallya, Chairman of Mendocino Brewing Company states, "The acquisition
of UBSN Ltd. UK, and securing the US distribution  rights for Kingfisher Premium
Lager by Mendocino  Brewing Company,  will present the company several strategic
benefits.  The  addition  of  Kingfisher,   a  two-time  World  Champion  lager,
strengthens our current brand portfolio and allows Mendocino  Brewing Company to
maximize our base of consumers.  Also,  UBSN with its strong presence in Europe,
presents us with the  possibility  of exporting  our Red Tail Ale and Eye of the
Hawk Select Ale brands to new markets.  We intend to take full  advantage of the
new opportunities before us."

Mendocino  Brewing  Company  has  historically  brewed  four  ales  and a  stout
year-round,  one seasonal ale, and one seasonal  porter.  The brands include Red
Tail Ale,  Blue Heron Pale Ale,  Eye of the Hawk Select  Ale,  Black Hawk Stout,
Peregrine Golden Ale, and two seasonals for the domestic craft beer market.  The
Corporation's  common  stock is publicly  traded on the Pacific  Stock  Exchange
under the symbol "MBR."1700 Corporate Circle, Petaluma, California

                                      LEASE

                                     between

                              RNM LAKEVILLE, L.P.,
                        a California Limited Partnership

                                   as LANDLORD

                                       and

                         HEALTHY PLANET PRODUCTS, INC.,
                             a Delaware corporation

                                    as TENANT

                                December 8, 1999

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                                      LEASE

                                TABLE OF CONTENTS

Paragraph                                                                   Page
---------                                                                   ----
1.  SUMMARY AND DEFINITIONS .................................................  1
2.  DEMISE ..................................................................  1
3.  ACCEPTANCE OF PREMISES ..................................................  2
4.  RENT ....................................................................  2
5.  SECURITY DEPOSIT ........................................................  2
6.  UTILITIES ...............................................................  3
7.  USE OF PREMISES .........................................................  3
8.  BROKERS .................................................................  3
9.  TENANT'S TAXES ..........................................................  3
10. ALTERATIONS, REPAIRS AND MAINTENANCE ....................................  4
11. LIENS ...................................................................  6
12. ENTRY ...................................................................  6
13. INDEMNIFICATION AND EXCULPATION .........................................  6
14. INSURANCE ...............................................................  7
15. NO SUBROGATION ..........................................................  8
16. DAMAGE OR DESTRUCTION ...................................................  8
17. CONDEMNATION ............................................................  9
18. DEFAULTS AND REMEDIES ...................................................  9
19. ENCUMBRANCES, ASSIGNMENT AND SUBLETTING ................................. 11
20. SUBORDINATION ........................................................... 12
21. ESTOPPEL CERTIFICATE .................................................... 13
22. SIGNS ................................................................... 13
23. SURRENDER OF PREMISES ................................................... 13
24. PROFESSIONAL FEES ....................................................... 13
25. GENERAL PROVISIONS ...................................................... 14
SIGNATURES .................................................................. 17

ADDENDUM

26. TENANT'S EXTENSION OPTION ...............................................  1
27. PARKING .................................................................  1
28. HAZARDOUS MATERIAL ......................................................  1
29. COMMON AREAS ............................................................  3
30. EXISTING LEASE ..........................................................  4

 Exhibits
 --------
    A        Definitions
    B        Floor Plan
    C        Tenant Items to Be Removed at Termination
    D        Form of Tenant Estoppel Certificate
    E        Rules and Regulations
    F        Hazardous Materials

<PAGE>

                                      LEASE

RNM  LAKEVILLE,  L.P., a California  Limited  Partnership  (with its  successors
called "Landlord"),  and HEALTHY PLANET PRODUCTS,  INC., a Delaware  corporation
(with its successors called "Tenant"), agree as follows as of December 8, 1999.

                                 R E C I T A L S

         A. Tenant is  currently  leasing  60,512  square feet of Rentable  Area
within the Building pursuant to that certain Lease Agreement dated as of January
12, 1996 ("Existing Lease").

         B. Tenant  wishes to surrender to Landlord  approximately  34181 square
feet of Rentable Area  ("Surrendered  Premises")  and twenty (20) parking spaces
and to be released  from its future  Lease  obligations  with  respect  thereto,
subject to the terms and conditions of this Lease.

         Therefore,  the  parties  agree  that upon the full  execution  of this
Lease,  the Existing  Lease shall be  superceded  in its entirety by this Lease,
except as expressly provided herein.

1. SUMMARY AND  DEFINITIONS:  The following  definitions  and those in Exhibit A
apply in this Lease:

         1.1. Premises:

                  (a) 26,472  square  feet of Rentable  Area in the  Building at
1700  Corporate  Circle in  Petaluma,  California  depicted  as the  Premises on
Exhibit B. The Premises  are part of a Project  comprising  of three  buildings,
parking areas and Common Areas. The Rentable Areas set forth in this Lease shall
be binding on the parties.

         1.2. Term:

                  (a) The Term shall commence upon completion of the Tenant Work
as  described  in  Paragraph  30.1(b)  of this  Lease or such  other date as the
parties shall mutually agree (the "Commencement Date").

                  (b) The Term  shall end at 11:59 p.m.  on April 14,  2002 (the
"Termination  Date").  The Termination  Date shall not be in any way extended or
advanced except pursuant to the provisions herein.

         1.3.  Base Rent:  Monthly  Base Rent for the Term of this  Lease  shall
$15883.00 per month.

         1.4. Tenant's Share: 35.0% of the Building and 8.10% of the Project.

         1.5. Use: The Premises  shall be used and occupied only for the purpose
of general office and the storage and distribution of consumer  products and for
no other purpose whatsoever.

         1.6. Security Deposit: $50,244.

         1.7. Brokers: None.

         1.8. Exhibits: Exhibits A, B, C, D, E and F.

2.  DEMISE.  For the Term,  Landlord  leases the  Premises  to Tenant and Tenant
leases the same from Landlord,  all upon and subject to the terms, covenants and
conditions of this Lease.

                                      -1-

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3. ACCEPTANCE OF PREMISES. Tenant hereby accepts the Premises AS-IS and WITH ALL
FAULTS.  Tenant  acknowledges that it has occupied the Premises since April 1996
and is fully familiar with its condition.  Notwithstanding the above,  Landlord,
at its expense, agrees to construct within the Premises two bathrooms for use by
Tenant*,  its employees and invitees.  Such  bathrooms  shall be  constructed in
accordance  with such plans as are reasonably  approved by Landlord and shall be
completed within one-hundred twenty days following the Commencement Date.

* Also to include sink and countertop with cabinets for breakroom area.

4. RENT. All amounts due hereunder from Tenant to Landlord,  whether  designated
as Base Rent,  Additional  Rent, late charges,  interest or otherwise,  shall be
deemed "rent" hereunder.  From the Commencement  Date, Tenant will pay Landlord,
without prior notice, demand, offset or deduction, the following rent:

         4.1. Base Rent.  Subject to the provisions of Paragraph  25.10,  Tenant
will pay the Base Rent  (prorated for any partial month) in advance on the first
day of each month during the term hereof.

         4.2. Additional Rent.

                  (a) Tenant shall pay Tenant's Share of Operating  Expenses and
Real Property Taxes. The terms "Tenant's Share",  "Operating Expenses" and "Real
Property Taxes" are defined in Exhibit A. For partial years,  Operating Expenses
and Real  Property  Taxes will be  calculated  on a  full-year  basis,  and then
prorated.  Tenant shall pay monthly installments of Additional Rent on the first
day of each month,  in amounts  specified in good faith by Landlord from time to
time,  which, by the end of each calendar year (or by the  Termination  Date, if
earlier),  will total Landlord's estimate of Additional Rent paid for such year.
As soon as is reasonably  practicable after the end of each calendar year during
which  Tenant paid  Additional  Rent based on  Landlord's  estimates as provided
above,  Landlord will furnish Tenant a statement of Operating  Expenses and Real
Property  Taxes for such year.  Any amounts  owing for that year  shall,  within
thirty (30) days, be paid by Tenant to Landlord.  Any amounts overpaid shall, at
Landlord's  option,  be credited  against the next  installment(s)  of estimated
Additional  Rent due  from  Tenant,  or be  refunded  to  Tenant.  The  parties'
obligations  with respect to payment or refund of any  deficiency or overpayment
shall survive termination or expiration of this Lease.

                  (b) Notwithstanding the foregoing, Tenant's responsibility for
any increase in Real Property Taxes  attributable to a sale or other transfer in
an arm's length transaction resulting in reassessment of the Building,  Property
or Premises shall be limited as follows:  (i) after the first such reassessment,
Tenant's annual  liability shall be limited to one hundred ten percent (110%) of
the Real Property Taxes payable before such  reassessment  ("Base  Assessment"),
plus any annual increase in taxes based on the Base  Assessment;  and (ii) after
the second such reassessment,  Tenant's annual liability shall be limited to the
Real Property Taxes payable before such  reassessment,  plus any annual increase
in taxes based on such  amount.  Nothing  contained  herein is intended to limit
Tenant's responsibility for supplemental, escaped or special assessments.

5. SECURITY  DEPOSIT.  To secure its performance of its  obligations  under this
Lease,  Tenant has deposited the Security Deposit with Landlord  pursuant to the
Existing  Lease.  Landlord shall hold such amount as Tenant's  Security  Deposit
under this Lease.  Landlord may commingle the Security Deposit with other funds.
If Tenant  defaults with respect to any provisions of this Lease,  including but
not limited to the provisions  relating to the payment of Rent,  Additional Rent
and any of the monetary sums due herewith, Landlord may use, apply or retain all
or any part of this  Security  Deposit for the payment of any other amount which
Landlord may spend or become obligated to spend by reason of Tenant's default or
to compensate Landlord for any other loss or damage which Landlord may suffer by
reason  of  Tenant's  default.  If any  portion  of said  deposit  is so used or
applied,  Tenant  shall,  within ten (10) days after written  demand  therefore,
deposit  cash with  Landlord in an amount  sufficient  to restore  the  Security
Deposit  to its  original  amount,  and  Tenant's  failure  to do so  shall be a
material  breach of this Lease.  Tenant shall  forthwith  on demand  restore the
Security Deposit to its full original amount. If Tenant is not in default at the
termination of this Lease,  Landlord will return any remaining Security Deposit,
without interest, upon receipt of Tenant's forwarding address, or as provided by
law,  whichever  is later.  Tenant  shall not assign

                                      -2-

<PAGE>

or encumber the Security  Deposit or attempt to do so, and Landlord shall not be
bound by any such  assignment  or  encumbrance.  Regardless  of any  Assignment,
Landlord may return the Security Deposit to the original Tenant.

6. SERVICES AND UTILITIES.  Tenant shall  contract for, and pay for,  janitorial
services for the Premises  using such  janitorial  contractor as Landlord  shall
approve,  which  approval  shall not be  unreasonably  withheld.  If  separately
metered or provided,  Tenant shall pay prior to delinquency for all water,  gas,
light, heat, power, electricity,  telephone,  janitorial service, trash pick-up,
sewer charges,  and all other services  supplied to or consumed on the Premises,
and all taxes and  surcharges  thereon.  If such  utilities  or services are not
separately metered or provided, Tenant shall pay Tenant's Share of such charges.
Tenant  shall  pay to  Landlord  Tenant's  Share  of the  cost of all  utilities
supplied in connection with the operation of the Common Areas.

7. USE OF PREMISES. Tenant will use and occupy the Premises only for the purpose
set forth in Paragraph 1.5 and no other, using and maintaining the Premises in a
careful,  sanitary  and  proper  manner.  Subject  to the  waiver  set  forth in
Paragraph  15,  Tenant  will pay for any damage to any part of the  Premises  or
Building  or  Project  caused  by any  negligence  or  willful  act by Tenant or
Tenant's employees, agents, contractors or invitees. Tenant will comply with the
Building's  Rules and  Regulations  and the CC&Rs and will not cause anywhere in
the Building or Project,  or permit in the  Premises,  (i) any activity or thing
contrary to applicable law,  ordinance,  regulation,  restrictive  covenant,  or
insurance  regulation whether now in force or hereafter in force; or which is in
any way  extra-hazardous  or could  jeopardize the coverage of normal  insurance
policies or increase their cost; (ii) waste or nuisance, or any activity causing
odors  perceptible  outside the Premises;  (iii) cooking or heating food, except
for  incidental  use,  solely for Tenant's  employees,  of  microwave  ovens and
beverage-brewing devices, provided that the foregoing do not use a flame and are
approved by Underwriters  Laboratories for residential use; (iv) overloading the
floors or the structural or mechanical systems of the Building;  or (v) obstruct
or  interfere  with the rights of other  tenants or users of the Building or the
Project.  Tenant shall not erect or place any item in or upon the Common  Areas.
Tenant shall store its waste either  inside the Premises or in its own dumpsters
located  within  outside  trash  enclosures.  Tenant  shall not store,  place or
maintain any garbage, trash, rubbish, other refuse or Tenant's personal property
in any area of the Common Area or exterior of the  Premises at any time.  Tenant
at its sole expense  shall be  responsible  to maintain and keep the  designated
trash  enclosures  free of garbage,  trash,  rubbish,  other  refuse or personal
property.  Tenant shall at Tenant's sole cost and expense faithfully observe and
promptly comply with all local, state and federal laws, statutes, ordinances and
governmental   resolutions,   orders,   rules,   regulations  and   requirements
(including,  by way of example, building codes, Title 24, and the Americans With
Disabilities  Act of  1990)  and  with  the  requirements  of any  board of fire
underwriters (or other similar body now or hereafter constituted) whether now in
force or  which  may  hereafter  be in  force  with  respect  to  Tenant's  use,
occupancy,  modification  or  possession  of  the  Premises,  Tenant's  business
conducted in the Premises or the design,  equipment condition,  use or occupancy
of the Premises. Tenant shall also comply with the CC&Rs and any other covenant,
condition or restriction affecting the Building or the Project. Without limiting
the generality of the  provisions of this  Paragraph 7, as between  Landlord and
Tenant,  Tenant shall make all  alterations  to the  Premises,  whether major or
minor, reasonably necessary to comply at any time with the requirements referred
to in this Paragraph 7.

8. BROKERS.  Landlord and Tenant  warrant that they have had no dealing with any
finder,  broker or agent in connection  with this Lease.  Tenant will indemnify,
defend and hold Landlord  harmless from and against any and all costs,  expenses
or liability for  commissions or other  compensation  or charges  claimed by any
finder,  broker or agent  based on dealings  with  Tenant  with  respect to this
Lease. Landlord will indemnify, defend and hold Tenant harmless from and against
any and all costs,  expenses or liability for commissions or other  compensation
or  charges  claimed  by any  finder,  broker or agent  based on  dealings  with
Landlord with respect to this Lease.

9.  TENANT'S  TAXES.  In addition to Tenant's  obligations  to pay Real Property
Taxes as set forth in  Section  4.2,  Tenant  shall be liable for and shall pay,
before delinquency,  all taxes levied or assessed against or attributable to any
personal property or trade fixtures in the Premises.  If any such taxes or

                                      -3-

<PAGE>

value are included in  Landlord's  taxes,  Landlord may pay them  regardless  of
their validity (under proper protest,  if requested by Tenant),  and Tenant upon
demand will repay Landlord.

10. ALTERATIONS, REPAIRS AND MAINTENANCE.

         10.1. Repairs and Maintenance.

                  (a)  Landlord  shall,  as  an  Operating  Expense  (except  as
excluded  herein),  repair and  maintain  the  exterior  roof,  exterior  walls,
foundations  and  structural  portions of the  Building  and the Project and the
improvements  within  the  Common  Areas  and the  building  standard  plumbing,
heating,  ventilating,  air  conditioning,  and electrical  systems  serving the
Building and the Project,  and any  sidewalks,  landscaping  (including  but not
limited to irrigation systems and backflow prevention  devices),  Parking Areas,
fences  and signs  located  in the areas  which are  adjacent  to the  Building.
Subject  to the  waivers  set  forth in  Paragraph  15, to the  extent  any such
maintenance  and repairs  are caused in part or in whole by the act,  neglect or
omission of any duty by Tenant or Tenant's  employees,  agents,  contractors  or
invitees, then Tenant shall pay to Landlord, as Additional Rent, the entire cost
of such maintenance and repairs.  Landlord shall not,  however,  be obligated to
paint the  interior  surface of  exterior  walls,  ceiling  or doors,  nor shall
Landlord be required to maintain, repair or replace windows, doors, skylights or
plate  glass.  Landlord  shall have no  obligation  to make  repairs  under this
Paragraph 10.1(a) until a reasonable time after receipt of written notice of the
need for  such  repairs.  Landlord  shall  maintain,  repair  or patch  the roof
membrane as an Operating  Expense,  and Tenant  shall pay Tenant's  Share of the
cost thereof, pursuant to Paragraph 4.2 above. Except for Landlord's obligations
with respect to the  condition of the Premises  upon delivery of the Premises to
Tenant,  Landlord shall have no obligation to alter, remodel,  improve,  repair,
decorate or paint the Premises or any part thereof.  Unless  otherwise  provided
herein,  there shall be no  abatement  of rent and no  liability  of Landlord by
reason of any injury to or interference  with Tenant's business arising from the
making of any repairs,  alterations or  improvements in or to any portion of the
Building, the Premises or parking areas or in or to fixtures,  appurtenances and
equipment  therein  provided  that all such  work is done in such a manner as to
reasonably minimize the disruption of Tenant's business ("Conditions of Entry").
Tenant  expressly  waives  the  benefits  of  any  statute  (including,  without
limitation,  the  provisions of  subsection 1 of Section 1932,  Section 1941 and
Section  1942 of the  California  Civil  Code and any  similar  law,  statute or
ordinance  now or hereafter in effect) which would  otherwise  afford Tenant the
right to make  repairs  at  Landlord's  expense  (or to deduct  the cost of such
repairs  from  rent  due  hereunder)  or to  terminate  this  Lease  because  of
Landlord's failure to keep the Premises in good order, condition and repair.

                  (b) In all other  regards,  Tenant,  at Tenant's sole cost and
expense, shall keep, maintain and preserve the Premises in first class condition
and repair and shall, promptly make all non-structural  repairs and replacements
to the Premises  and every part  thereof,  including  but not limited to floors,
ceilings,  windows, doors, skylights,  interior walls, and the interior surfaces
of the exterior  walls,  plumbing,  heating,  air  conditioning  and ventilating
equipment,  telecommunications  equipment  and  intrabuilding  network  cabling,
electrical and lighting  facilities and equipment including circuit breakers and
exterior lighting attached to the Premises. At Landlord's request,  Tenant shall
provide  Tenant with copies of any  maintenance  contracts and  certificates  of
insurance from its  contractors.  In the event Tenant fails to perform  Tenant's
obligations  under this  Section,  Landlord  shall give Tenant notice to do such
acts as Landlord deems are reasonably  required to so maintain the Premises.  If
Tenant, within ten (10) days after notice from Landlord, fails to commence to do
the work and diligently prosecute it to completion, then Landlord shall have the
right  (but not the  obligation)  to do such acts and  expend  such funds at the
expense of Tenant as are reasonably required to perform such work. Any amount so
expensed by Landlord shall be paid by Tenant promptly after demand as Additional
Rent.  Landlord shall have no liability to Tenant for any damage,  inconvenience
or interference with the use of the Premises by Tenant as a result of performing
any such work and other communications equipment and lines.

         10.2. Alterations.

                  (a) Tenant will not make or permit  alterations,  improvements
or  additions  (including   fixtures)  in  or  to  the  Premises   (collectively
"Alterations")  without Landlord's prior,  written consent. At the

                                      -4-

<PAGE>

time Landlord grants its consent to any Alterations,  Landlord may notify Tenant
in writing (a  "Removal  Notice")  that  Tenant  will be required to remove such
Alterations at the expiration or termination of the Term in accordance  with the
provisions of Paragraph 23.1 hereof.  Notwithstanding  the foregoing,  (i) minor
alterations  such as repainting and carpeting,  or alterations with an aggregate
cost of less than  $25,000  per year,  and (ii) which do not  affect  structural
components or building systems,  shall not require Landlord's consent hereunder,
but all work in connection therewith shall be conducted and completed in a first
class manner and in such a manner as to not materially interfere with the use of
the Common  Areas or any other  portion of the  Project by Landlord or its other
tenants.  Tenant's request for such consent shall be in writing,  accompanied by
proposed  detailed  plans and  specifications.  Landlord  may require  Tenant to
provide Landlord,  at Tenant's cost and expense,  a payment and performance bond
in an amount equal to the estimated cost of such Alterations, to insure Landlord
against any liability for any mechanic's and  materialmen's  liens and to insure
completion of the work.  Alterations will be performed,  if Landlord elects,  by
Landlord or a contractor  designated by Landlord,  at Tenant's cost and expense.
Tenant may engage its own  contractors  to  perform  remodel  work upon  written
approval by Landlord.  In such event,  Landlord shall charge a five percent (5%)
administration  fee on all  construction  costs.  Any  and  all  plans  must  be
submitted to Landlord for approval,  and building permits must be obtained prior
to commencement of any construction remodeling.  All alterations,  additions and
improvements  constructed  by Tenant shall remain the property of Tenant  during
the Lease Term but shall not be damaged,  altered, or removed from the Premises.
Subject to Paragraph 23, at the  expiration or sooner  termination  of the Lease
Term, all alterations,  additions, or improvements except moveable furniture and
trade fixtures not affixed to the Premises shall be surrendered to Landlord as a
part of the  realty and shall  then  become  Landlord's  property.  Tenant  will
promptly  notify  Landlord of the value  thereof for insurance and tax purposes.
Tenant will hold Landlord forever harmless against any and all claims,  expenses
(including taxes) and liabilities of every kind which may arise out of or in any
way be  connected  with any work  performed  by or on behalf of Tenant.  Without
limiting the  generality of the  foregoing,  all heating,  lighting,  electrical
(including all wiring, conduit, outlets, drops, buss ducts, main and subpanels),
air conditioning, partitioning, drapery, and carpet installations made by Tenant
regardless  of how affixed to the Premises,  together with all other  additions,
alterations and improvements  that have become an integral part of the Building,
shall be and become the property of the Landlord upon  termination of the Lease,
and shall not be deemed trade fixtures, and shall remain upon and be surrendered
with the Premises at the termination of this Lease.  Notwithstanding anything to
the contrary  contained herein,  Landlord has consented to Tenant installing the
improvements,  trade  fixtures  and  equipment  described  on Exhibit C attached
hereto and to the removal  thereof at the  expiration of the term of this Lease,
except from the Surrendered  Premises.  Prior to the expiration of the Term, all
of such items shall be removed by Tenant, and any and all damage caused by their
installation,  use or removal  (including  all holes and other  damage to walls,
floors,  ceilings,  doors,  fixtures,  windows,  etc.) shall be repaired and the
Premises  repaired and restored to their condition  prior to such  installation,
all at Tenant's sole cost.

                  (b)  Tenant  shall give  Landlord  not less than ten (10) days
notice prior to the  commencement of any work in the Premises by or on behalf of
Tenant, and Landlord shall have the right to post notices of  non-responsibility
in or on the  Premises or the  Building as  provided  by law.  All  Alterations,
repairs and  replacements by Tenant shall be made,  constructed and installed in
accordance  with all applicable  laws,  rules and  ordinances  (and Tenant shall
perform  all work  necessary  to  comply  fully  with all laws,  ordinances  and
regulations   necessitated   by   the   Alterations,   whether   structural   or
non-structural,  within or without the  Premises)  and the  requirements  of any
insurance  carrier,  and shall be of a quality  and class at least  equal to the
original  work,  performed  in a good and  workmanlike  manner  with  grades  of
materials  approved  by  Landlord.  Tenant  will give  Landlord  opportunity  to
supervise all work. Tenant shall provide Landlord with permit drawings, as-built
sepia  drawings,  job cards and  temporary  certificates  of  occupancy  for all
Alterations  promptly upon their completion.  Should Tenant make any Alterations
without  Landlord's prior written approval,  or in violation of such approval or
the  requirements of this Paragraph  10.2,  Landlord may, at any time during the
Term,  either  remove  any part or all of the  same on  Tenant's  behalf  and at
Tenant's expense, or require that Tenant do so.

                  (c) If during the term of this Lease, any alteration, addition
or change of any sort,  whether structural or otherwise to all or any portion of
the  Premises or Building  is  required by law  (including,  but not limited to,
alterations  required  by the  Americans  with  Disabilities  Act of 1990 or any

                                      -5-

<PAGE>

amendments thereto or any regulations  prorogated  thereunder  (collectively the
"ADA") because of (i) Tenant's use or occupancy of the Premises or change of use
or  occupancy  of the  Premises,  (ii)  Tenant's  application  for any permit or
governmental  approval,  (iii)  Tenant's  construction  or  installation  of any
leasehold  improvements or trade  fixtures,  (iv) any violation by Tenant of any
Law (including any  requirement of the ADA), (v) any special use of the Premises
or any part thereof by Tenant or any subtenant or assignee of Tenant (including,
but not limited to any use for a facility which  constitutes,  or if open to the
public would generally  constitute a "place of public  accommodation"  under the
ADA  requirements),  or (vi) any special needs of the employees of Tenant or any
assignee or subtenant of Tenant, then Tenant shall promptly make the same at its
sole cost and expense.  Within ten (10) days after receipt,  Tenant shall notify
Landlord in writing and provide Landlord with copies of (i) any notices alleging
any  violation of any Law relating to the Premises or Tenant's  occupancy or use
of the Premises,  including any notices alleging violation of the Project or the
ADA to any  portion of the  Project  or the  Premises;  (ii) any claims  made or
threatened in writing regarding  non-compliance with the ADA or any Law relating
to the Project or the Premises;  or (iii) any governmental or regulatory actions
or investigations instituted or threatened regarding non-compliance with the ADA
or any Law relating to any portion of the Project or the Premises.

11.  LIENS.  Tenant  shall  not  permit  any lien on any  part of the  Premises,
Building or the Project allegedly resulting from any work or materials furnished
or obligations  incurred by or for Tenant.  Tenant shall discharge any such lien
of record  immediately  upon its filing.  Neither this Lease, nor any request or
consent of Landlord to the labor, materials or obligations, is a consent to such
a lien.  Landlord may keep posted on the Premises any notices it deems necessary
for protection from such liens.  Landlord may cause such liens to be released by
any means it deems proper,  including  payment,  at Tenant's expense and without
affecting Landlord's rights.

12. ENTRY.  Landlord may enter any part of the Premises at all reasonable  hours
(or in any emergency or suspected emergency, at any hour), to (a) inspect, test,
clean,  or make  repairs,  alterations  and  additions  to the  Building  or the
Premises  as Landlord  believes  appropriate,  or (b) provide any service  which
Landlord is now or hereafter  obligated to furnish to tenants of the Building or
the Project,  or (c) show the Premises to  prospective  lenders,  purchasers  or
tenants and, if they are vacated, to prepare them for reoccupancy. Tenant hereby
waives  any  claim  for  abatement  of  rent  or for  damages  for  any  injury,
inconvenience to or interference, loss of occupancy or quiet enjoyment caused by
Landlord's  entry.  Landlord  shall at all times have keys to all doors to or in
the Premises.

13. INDEMNIFICATION AND EXCULPATION.

                  (a) Tenant will  indemnify,  defend and hold and save Landlord
and its employees, officers, directors, shareholders,  partners and agents (each
an  "Indemnitee")  harmless  from all fines,  suits,  losses,  costs,  expenses,
liabilities,  claims, demands,  actions,  damages and judgments  ("Liabilities")
suffered by,  recovered from or asserted  against the Indemnitee,  of every kind
and character, resulting from (i) the operation, condition,  maintenance, use or
occupancy of the  Premises,  (ii) any bodily  injury,  death or property  damage
occurring in or about the Premises, (iii) any act, omission or neglect of Tenant
or its  agents,  or (iv) any breach or default  in the  performance  in a timely
manner of any  obligation  on Tenant's  part to be  performed  under this Lease.
Tenant, as a material part of the consideration to Landlord,  hereby assumes all
risk of damage to property or injury to persons,  in, upon or about the Premises
arising from any cause and Tenant  hereby  waives all claims in respect  thereof
against Landlord.

                  (b) Landlord will  indemnify,  defend and hold and save Tenant
and its related Indemnitees  harmless from and against all Liabilities  suffered
by,  recovered from or asserted against Tenant and its related  Indemnitees,  of
every  kind and  character,  resulting  from any  injury  or damage to person or
property  within  the  Project  but  only  to the  extent  caused  by the  gross
negligence  or  intentional  misconduct  of Landlord or its  employees,  agents,
contractors or invitees (not including other tenants of the Project).

                                      -6-

<PAGE>

                  (c) If any such proceeding is brought,  the indemnifying party
will retain counsel  reasonably  satisfactory to the indemnified party to defend
the indemnified  party at the  indemnifying  party's sole cost and expense.  All
such costs and expenses,  including  attorneys' fees and court costs, shall be a
demand obligation owing by the indemnifying  party to the indemnified party. The
indemnifying  party's  obligations  under this  Paragraph  13 shall  survive the
termination or expiration of this Lease.

14. INSURANCE.  Tenant, during the term and any other period of occupancy, will,
at its expense,  maintain insurance reasonably  satisfactory to Landlord, but in
no event less than:

                  (a) General  Liability  insurance with combined  single limits
not less than  $3,000,000.00,  for personal  injury or death and property damage
occurring  in or about or related to the use of the Premises or Tenant's (or its
agents,  employees or  representatives)  use of the  Building,  Common Areas and
Project.  Such  comprehensive  general liability  insurance shall be extended to
include  a  "blanket  contractual   liability"   endorsement  insuring  Tenant's
performance of Tenant's obligation to indemnify Landlord contained in Section 13
and all of the other  broadened  liability  features  normally  contained  in an
extended  liability  endorsement,  including,  provided  Tenant  uses  Hazardous
Materials pursuant to Paragraph 28 without limitation, "Pollution Liability".

                  (b) "All Risk" insurance for 80% of the full  replacement cost
of all  Tenant's  property  on the  Premises  and  all  fixtures  and  leasehold
improvements  in the Premises.  Unless this Lease is  terminated  upon damage or
destruction,  the  proceeds  of such  insurance  will be  used  to  restore  the
foregoing.

                  (c)  Worker's  Compensation  (as  required by state law),  and
Employer's Liability insurance in the amount of not less than $500,000.00.

                  All  policies  required  hereunder  will be issued by carriers
rated A-VII or better by Best's Key Rating  Guide and licensed to do business in
the State of California.  The policies shall name Landlord,  Landlord's managing
agent and any other person or entity that  Landlord may  designate  from time to
time as additional insureds,  with primary coverage  non-contributing to and not
in excess of any insurance  Landlord may carry,  and shall provide that coverage
cannot be cancelled  or  materially  changed  except upon thirty (30) days prior
written  notice to Landlord.  At least thirty (30) days prior to  expiration  of
such  policies,  and promptly upon any other  request by Landlord,  Tenant shall
furnish  Landlord  with  copies  of  policies,  or  certificates  of  insurance,
evidencing maintenance and renewal of the required coverage. In the event Tenant
does not maintain  said  insurance,  Landlord  may, in its sole  discretion  and
without waiving any other remedies hereunder,  procure said insurance and Tenant
shall pay to Landlord as Additional  Rent the cost of said  insurance plus a ten
percent (10%)  administrative  fee. If Landlord's  lender,  insurance advisor or
counsel  reasonably  determines  at any time that the amount of such coverage is
not adequate,  Tenant shall  increase such coverage to such amount as Landlord's
lender,  insurance  advisor or counsel  reasonably deems adequate but such right
may not be exercised by Landlord  more than once every two (2) years.  The limit
of such insurance shall not limit the liability of Tenant.

                  During the Term, Landlord shall insure the Building (excluding
any property  which Tenant is obligated to insure)  against damage with All-Risk
insurance (including earthquake as commercially reasonable) and public liability
insurance,  business interruption  insurance to protect against any interruption
or disturbance to Tenant's  business  conducted in the Premises for up to twelve
(12)  months and,  all in such  amounts  and with such  deductibles  as Landlord
considers  appropriate.  Landlord may, but shall not be obligated to, obtain and
carry any other form or forms of insurance as it or its Mortgagees may determine
advisable.  Tenant  has no right to  receive  any  proceeds  from any  insurance
policies carried by Landlord.  Notwithstanding  anything in the foregoing to the
contrary, however, Landlord may self-insure.

                  If the acts or  omissions  of  Tenant or  Tenant's  employees,
agents,  contractors  or invitees,  whether or not Landlord has consented to the
same, increase the cost of Landlord's  insurance,  Tenant will pay the full cost
of any such increase as additional rent.

15. NO  SUBROGATION.  The  parties  shall use their best  commercial  efforts to
obtain property insurance policies affecting the Premises which include a clause
or endorsement  denying the insurer any

                                      -7-

<PAGE>

rights of  subrogation  against the other  party.  Landlord and Tenant waive any
rights or recovery against the other for any actually insured injury or loss and
any injury or loss required to be insured against hereunder.

16.  DAMAGE OR  DESTRUCTION.  If the Premises or any part thereof are damaged by
fire or other casualty, Tenant will promptly notify Landlord.

         16.1.  Cancellation of Lease;  Restoration of Building. If the Building
or the  Premises  are  damaged  by fire or other  casualty  to the  extent  that
substantial alteration or reconstruction is required in Landlord's sole opinion,
Landlord may  terminate  this Lease by notifying  Tenant  within sixty (60) days
after  the  later of the date the  damage  occurs,  or the date  Landlord  is so
notified by any holder  ("Mortgagee") of a mortgage or deed of trust (blanket or
otherwise)  covering any part of the Building  ("Mortgage"),  in which event the
rent  under  this  Lease  will be  abated  as of the  date of the  fire or other
casualty.  In the event Landlord  elects to terminate  this Lease,  Tenant shall
have the right within ten (10) days of receipt of the required  notice to notify
Landlord, in which event this Lease shall continue in full force and effect, and
Tenant  shall  proceed to make such repairs as soon as  reasonably  possible (or
Landlord may elect, in its sole discretion, to require Tenant to pay to Landlord
within ten (10) days following  written request  therefor,  or furnish  evidence
reasonably satisfactory to Landlord of Tenant's ability to fund, that portion of
the cost of such  repair  or  restoration  which  is not  covered  by  insurance
proceeds, in which event Landlord shall proceed to make such repairs). If Tenant
does not give such notice  within the ten (10) day  period,  this Lease shall be
cancelled and  terminated as of the date of the  occurrence of such damage.  All
insurance proceeds available from the fire and property damage insurance carried
by Landlord pursuant to Paragraph 14 shall be paid to and become the property of
Landlord.  If this Lease is not terminated,  then within  seventy-five (75) days
after the fire or other  casualty,  or such greater  period as may be reasonably
necessary,  Landlord  will  commence to repair and restore the  Premises and any
portion of the Building required for access to the Premises, and will diligently
complete  the same,  but  Landlord is not  required  (a) to expend more for such
repair of the  Premises  than the net  insurance  proceeds  (after  any  payment
required  under any Mortgage)  reasonably  allocable to the Premises,  or (b) to
rebuild, repair or replace any of Tenant's furniture,  furnishings,  fixtures or
equipment removable by Tenant under the provisions of this Lease or which Tenant
has  insured  or is  required  to insure  under the  provisions  of this  Lease.
Notwithstanding  the above, if the damage to the Building or Premises was caused
by  the  fault,  omission  or  negligence  of  Tenant,  its  agents,  employees,
contractors or invitees,  such damage shall be repaired by and at the expense of
Tenant under the direction and  supervision of Landlord,  and there shall be not
abatement of rent.

         16.2.  Casualty  Loss During Last Year of Lease.  If the  Premises  are
damaged by fire or other  casualty  during the last  twelve  (12)  months of the
Term, whether or not the damage requires  substantial repair and reconstruction,
Landlord  may cancel this Lease as of the date of the fire or casualty by notice
to Tenant within thirty (30) days  thereafter;  provided,  however,  that if any
unexercised  option to extend  the Term is in then full force and  effect,  then
Tenant may exercise  such option  within the ten (10) days after receipt of such
cancellation  and this Lease shall  continue in effect for the  remainder of the
extended Term, subject to all the other provisions hereof.

         16.3.  Abatement of Rent.  Landlord will allow Tenant a fair diminution
of rent while and to the extent the Premises are unfit for occupancy due to fire
or other casualty.  Except as expressly  provided to the contrary in this Lease,
this Lease will not terminate,  and Tenant will not be entitled to damages or to
any abatement of rent or other charges, as a result of a fire or other casualty,
repair or restoration  Tenant hereby waives the  provisions of California  Civil
Code  Sections  1932(2) and 1933(4)  which  permit  termination  of a lease upon
destruction  of Premises,  and any other  present or future  statute that may so
permit.

17. CONDEMNATION. If all or substantially all of the Building or of the Premises
is taken  for any  public  or  quasi-public  use  under  any  governmental  law,
ordinance  or  regulation  or by  right  of  eminent  domain  or is  sold to the
condemning  authority in lieu of  condemnation,  then this Lease will  terminate
when physical possession is taken by the condemning  authority.  If a lesser but
material  portion  of the  Building  is thus taken or sold  (whether  or not the
Premises are affected  thereby),  Landlord may terminate

                                      -8-

<PAGE>

this Lease by notice to Tenant  within sixty (60) days after the taking or sale,
in which  event  this Lease  will  terminate  when  physical  possession  of the
applicable  portion of the Building or the  Premises is taken by the  condemning
authority.  If the Lease is not terminated,  rent payable will be reduced by the
amount  allocable to any portion of the Premises so taken or sold, and Landlord,
at its sole  expense,  will  restore  the  affected  portion of the  Building to
substantially  its former  condition as far as  commercially  feasible,  but not
beyond the work done by Landlord in originally constructing the affected portion
of the Building and installing  tenant  improvements  in the Premises.  However,
Landlord  need not spend  more for such  restoration  of the  Premises  than the
Premises'  allocable  share  of the net  compensation  or  damages  received  by
Landlord  for the part of the  Building  taken.  Landlord  shall be  entitled to
receive all of the compensation  awarded upon a taking of any part or all of the
Building or Premises,  including any award for any unexpired term of this Lease.
Tenant may seek an award in  separate  proceedings  for its  personal  property,
trade fixtures and moving expenses.

         In the event of such taking or sale of the Premises or any part thereof
for  temporary  use of not more  than one (1)  year,  this  Lease  shall  remain
unaffected  and rent  shall not  abate,  and Tenant  shall be  entitled  to such
portion or portions of any award made for such use with respect to the period of
the taking which is within the Term,  provided that, if such taking shall remain
in force at the expiration or earlier  termination  of this Lease,  Tenant shall
then pay to Landlord a sum equal to the reasonable  cost of performing  Tenant's
obligations with respect to surrender of the Premises.

         To the  extent  that it is  inconsistent  with the  provisions  of this
Paragraph 17, each party hereto hereby waives the provisions of Section 1265.130
of the California  Code of Civil  Procedure  allowing either party to petition a
court to terminate this Lease in the event of a partial taking of the Premises.

18. DEFAULTS AND REMEDIES.

         18.1. Events of Default. The occurrence of one or more of the following
events shall constitute a material default and breach hereunder by Tenant:

                  18.1.1  Tenant  fails to make a payment  within three (3) days
after written notice that it is due hereunder; or

                  18.1.2 Tenant fails to comply with any other  obligation under
this Lease and does not cure such failure as soon as reasonably  practicable and
in any event within twenty (20) days after written notice or, if such failure is
not  susceptible  of cure  within  twenty  (20)  days,  as  soon  as  reasonably
practicable after such written notice,  provided Tenant commences to cure within
such twenty (20) day period and diligently  prosecutes  such cure to completion;
or

                  18.1.3 Tenant attempts any Assignment (as defined in Paragraph
19) except as expressly permitted pursuant to Paragraph 19; or

                  18.1.4  Tenant or any  Guarantor  becomes  insolvent,  makes a
transfer in fraud of creditors or an  assignment  for the benefit of  creditors,
admits in writing its  inability to pay its debts as they become due, or files a
petition  under any Section or Chapter of the United States  Bankruptcy  Code or
any similar law or statute;  or an order for relief is entered  with  respect to
Tenant  or  any  Guarantor  in  any  bankruptcy,  reorganization  or  insolvency
proceedings;  or a pleading  seeking such an order is not  discharged  or denied
within  sixty  (60) days  after its  filing;  or the taking of any action at the
corporate  or  partnership  level by Tenant to  authorize  any of the  foregoing
actions on behalf of Tenant;  or a receiver or trustee is  appointed  for all or
substantially all assets of Tenant or any guarantor or of the Premises or any of
Tenant's  property  located  thereon  in any  proceedings  brought  by Tenant or
Guarantor,  or any receiver or trustee is appointed  in any  proceeding  brought
against  Tenant or  Guarantor  and not  discharged  within sixty (60) days after
appointment  or Tenant or Guarantor  does not contest such  appointment;  or any
part of  Tenant's  estate  under  this  Lease is taken by  process of law in any
action  against  Tenant (but in the event that any  provision of this  Paragraph
18.1.4 is contrary to any applicable law, such provision shall be of no force or
effect); or

                                      -9-

<PAGE>

                  18.1.5 Tenant abandons or vacates the Premises; or

                  18.1.6 Three (3) times within any twelve-month period,  Tenant
fails to fulfill an obligation under this Lease, even if Tenant thereafter cures
such failure within the time provided.

                           Any notice specified above shall serve as, and not be
in addition to, any notice  required under  California  Code of Civil  Procedure
Section 1161 or otherwise regarding unlawful detainer actions.

         18.2.  Remedies.  On an event of default,  Landlord may terminate  this
Lease by notice to Tenant,  or  continue  this  Lease in full force and  effect,
and/or perform Tenant's obligations on Tenant's behalf and at Tenant's expense.

                  18.2.1 If and when this Lease is so terminated,  all rights of
Tenant and those claiming under it will terminate.  In such event,  Landlord may
immediately recover from Tenant:

                           (a) The worth at the time of award of any unpaid rent
which had been earned at the time of such termination; plus

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

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

                           (d) Any other amount necessary to compensate Landlord
for all the detriment proximately caused by Tenant's failure to perform Tenant's
obligations  under this Lease or which in the ordinary course of things would be
likely  to  result  therefrom,  including  but not  limited  to the  unamortized
principal balance of any suspended rent, moving allowance,  Tenant's  Allowance,
Broker's commission,  legal and other professional fees and other costs incurred
by  Landlord  in  connection  with the  entering  into of this  Lease,  using an
amortization  schedule equal to the initial term of this Lease (or the Extension
Term, if any  Extension  Option has been  exercised)  and a discount rate of the
Prime Rate plus 4% per annum,  plus (A)  expenses  for  cleaning,  repairing  or
restoring  the  Premises;  (B) expenses for  altering,  remodeling  or otherwise
improving the Premises for the purpose of reletting,  including  installation of
leasehold  improvements  (whether such  installation be funded by a reduction of
rent, direct payment or allowance to the succeeding  lessee, or otherwise);  (C)
real estate broker's fees, advertising costs and other expenses of reletting the
Premises;  (D)  costs of  carrying  the  Premises  such as taxes  and  insurance
premiums thereon,  utilities and security precautions;  (E) expenses in retaking
possession of the Premises; and (F) attorneys' fees and court costs.

                  As used in  Subsections  (a) and (b) above,  the "worth at the
time of award" is  computed by  allowing  interest at the Prime Rate,  plus four
percent  (4%) per annum (or at the maximum rate  permitted by law,  whichever is
less).  As used in  Subsection  (c)  above,  the "worth at the time of award" is
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%).  Until Tenant
confirms in writing that this Lease is terminated,  Landlord's  failure to relet
the Premises shall not constitute a failure to mitigate damages.

                  18.2.2 Landlord shall have the remedy  described in California
Civil Code Section  1951.4  (Landlord  may  continue  this Lease in effect after
Tenant's breach,  even if Tenant has abandoned the Premises,  and enforce all of
Landlord's rights and remedies under this Lease,  including the right to recover
rent as it becomes  due,  if Tenant  has the right to sublet or assign,  subject
only to reasonable limitations).

                                      -10-

<PAGE>

                  18.2.3  Upon an event of default  or when  Tenant is no longer
entitled to possession,  Landlord may enter the Premises and dispose of Tenant's
property as herein provided,  and may perform Tenant's obligations  hereunder on
Tenant's  behalf.  Tenant  will  reimburse  Landlord  on demand  for  Landlord's
attorneys'  fees and other  expenses in doing so. This  Paragraph  18.2.3  shall
survive expiration or termination of this Lease.

         18.3. Continuing Liability.  No repossession,  re-entering or reletting
of the  Premises or any part  thereof by Landlord  shall  relieve  Tenant or any
Guarantor of its liabilities and obligations under this Lease.

         18.4.  Remedies  Cumulative.  All rights and remedies of Landlord under
this  Lease  will be  non-exclusive  of and in  addition  to any other  remedies
available to Landlord at law or in equity.

         18.5. No Waiver. Landlord's failure to insist on strict compliance with
any terms  hereof or to exercise  any right or remedy,  does not waive the same.
Waiver of any agreement  regarding any breach does not affect any  subsequent or
other breach, unless so stated. A receipt by Landlord of any rent with knowledge
of the breach of any covenant or agreement  contained in this Lease shall not be
a waiver of the breach,  and no waiver by Landlord of any violation or provision
of this Lease  shall be  effective  unless  expressed  in writing  and signed by
Landlord.  Payment by Tenant or receipt by Landlord of a lesser  amount than due
under  this Lease may be applied to such of  Tenant's  obligations  as  Landlord
elects.  No endorsement or statement on any check,  and no accompanying  letter,
shall  make the same an accord and  satisfaction,  and  Landlord  may accept any
check or payment without prejudice to Landlord's right to recover the balance of
the rent or pursue any other remedy provided in this Lease.

19.  ENCUMBRANCES,  ASSIGNMENT AND SUBLETTING.  Except upon  Landlord's  written
consent,  which shall not be unreasonably  withheld or delayed,  or as otherwise
permitted herein, Tenant may not assign, transfer, or encumber this Lease or any
estate or interest  herein,  or permit the same to occur, or sublet or grant any
right of occupancy for any part of the Premises, or permit such occupancy by any
other parties other than Tenant and Tenant's  employees,  or modify or terminate
any agreement  providing for any of the foregoing  (the  foregoing  collectively
referred to as "Transfer,"  and the other party thereto the  "Transferee").  Any
prohibited Transfer is voidable by Landlord.

         19.1.  Conditions  of Transfer.  Landlord's  consent to a Transfer may,
without limitation,  be conditioned on Landlord's  determination whether (a) the
Transferee  will  conduct  business  of a  quality  equal  to  that  of  Tenant,
consistent  with the character of the Project and its occupants,  and consistent
with any exclusives or other rights held by or contemplated for other occupants,
and (b) the Transferee's financial  responsibility shall equal or exceed that of
Tenant  and that which is then  required  by  Landlord,  whichever  is  greater.
Consent by Landlord to any Transfer  shall not be a waiver of Landlord's  rights
as to any subsequent Transfers. Any approved Transfer shall be expressly subject
to the terms and conditions of this Lease.  If Tenant's  obligations  under this
Lease have been guaranteed by third parties (herein called  "Guarantors"),  then
Landlord's consent to the Transfer may be conditioned upon Landlord's receipt of
the written consent of each Guarantor to such Transfer and the terms thereof. In
the event of any Transfer,  each transferor and all Guarantors will remain fully
responsible and liable for all of Tenant's obligations under this Lease, and the
Transferee will  automatically  be jointly and severally liable to the extent of
the  transferred  portion  of  the  Premises.  Upon  an  event  of  default,  as
hereinafter  defined,  while a  Transfer  is in  effect,  Landlord  may  collect
directly from the  Transferee all sums becoming due to Tenant under the Transfer
and apply this  amount  against  any sums due  Landlord  by  Tenant,  and Tenant
authorizes and directs any Transferee to make payments directly to Landlord upon
notice from Landlord. No direct collection by Landlord from any Transferee shall
constitute  a novation or release of Tenant or any  Guarantor,  a consent to the
Transfer  or a  waiver  of the  covenant  prohibiting  Transfers.  Landlord,  as
Tenant's  agent,  may endorse any check,  draft or other  instrument  payable to
Tenant for sums due under a Transfer,  and apply the proceeds in accordance with
this Lease; this agency is coupled with an interest and is irrevocable.

         19.2. Request to Assign or Sublet;  Cancellation.  With any request for
consent  to a  Transfer,  Tenant  will  submit a copy of the  proposed  Transfer
document to Landlord and notify  Landlord of

                                      -11-

<PAGE>

the proposed effective date of the Transfer, the name of the proposed Transferee
(accompanied by evidence of the nature,  character,  and financial  condition of
the  Transferee  and its  business),  and all  terms and  conditions  (including
rental) of or relating to the Transfer. Notwithstanding anything to the contrary
in this  Paragraph  19, within thirty (30) days of such request (or any time, if
Tenant  enters into any Transfer  without  obtaining  the consent of  Landlord),
Landlord,  by notice to Tenant,  may terminate this Lease (and, in the case of a
sublease of substantially  all the Premises for the balance or substantially all
the balance of the Term,  Landlord may  terminate  this Lease in its entirely or
may terminate this Lease as to all or any portion of the Premises proposed to be
sublet),  as of the proposed  effective date of the Transfer as if that were the
original  Termination Date (or  immediately,  if Tenant enters into the Transfer
without obtaining the consent of Landlord).  If Landlord so elects to terminate,
Landlord  shall  have the right to relet the  Premises  (or the  portion  of the
Premises as to which this Lease is terminated pursuant to Landlord's election as
a result of a sublease) or any portion thereof to anyone (including the proposed
Transferee) on any terms, and Tenant shall not be entitled to any portion of any
profit Landlord may realize as a result of any such reletting.  If this Lease is
terminated  as to a portion of the Premises as a result of the  foregoing,  then
Base Rent,  Tenant's Share of Operating  Expenses,  Tenant's  parking rights (if
any),  and any other  provisions  hereof  based  upon the  rentable  area of the
Premises  shall be  reduced  by the  amount  allocable  to such  portion  of the
Premises so terminated.

         19.3.  Excess  Rent.  If the  consideration  Tenant  receives  for  any
Transfer  exceeds  the rent  payable  under this  Lease for the same  period and
portion of the  Premises  and  Tenant's  subleasing  expenses  such as  broker's
commissions, advertising costs and tenant improvements, then fifty percent (50%)
of the excess  shall be  immediately  due and  payable by Tenant to  Landlord as
Additional Rent under this Lease.

         19.4.  Transfers to Related Entities.  "Transfer" within the meaning of
this  Paragraph  19 shall not include any  sublease  or  assignment  of all or a
portion of the  Premises to any (i) person,  corporation  or  partnership  which
controls,  is  controlled  by or is under common  control  with  Tenant;  (ii) a
successor corporation related to Tenant by merger, consolidation,  nonbankruptcy
reorganization  or government  action; or (iii) a purchaser of substantially all
of the Tenant's assets; provided that, in each instance described above, (a) the
transferee  assumes the  obligations of the Tenant under this Lease in a written
instrument delivered to Landlord;  (b) the transferor Tenant remains liable as a
primary  obligor for the  obligations  of Tenant  under this Lease;  and (c) the
financial  strength of the transferee Tenant is no less than Tenant's  financial
strength as of the Commencement Date or the date of such Transfer,  whichever is
greater.  Tenant  shall  notify  Landlord  of any such  transfer to a related or
successor entity prior to its consummation.

20.  SUBORDINATION.  This  Lease and all  rights of Tenant  under this Lease are
subordinate to any of the following,  and any modifications  thereof,  which may
now or hereafter affect any portion of the Building: any Mortgage, or any ground
or  underlying  lease  covering  any  part of the  Building,  provided  that the
Mortgage holder or ground lessor shall agree that Tenant's peaceable  possession
of the Premises will not be disturbed on account of such  subordination  so long
as Tenant is not in default and performs all obligations  hereunder.  On sale by
foreclosure of a Mortgage or sale in lieu of foreclosure,  Tenant will attorn to
the purchaser if requested by such purchaser, and recognize the purchaser as the
Landlord under this Lease.  These provisions are  self-operative  and no further
instrument is required to effect them;  however,  upon demand from time to time,
Tenant  shall  execute,  acknowledge  and  deliver to Landlord  any  instruments
necessary or proper to evidence  such  subordination  and/or  attornment  or, if
Landlord so elects, to render any of the foregoing  subordinate to this Lease or
to any or all rights of Tenant  hereunder.  Tenant further waives the provisions
of any current or future statute,  rule or law which may give or purport to give
Tenant any right or election to  terminate or  otherwise  adversely  affect this
Lease  and  the  obligations  of  Tenant  hereunder  in the  event  of any  such
foreclosure proceeding or sale, and agrees that this Lease shall not be affected
in any way whatsoever by any such  proceeding or sale unless the  Mortgagee,  or
the purchaser, shall declare otherwise.

21. ESTOPPEL  CERTIFICATE.  Upon  Landlord's  written request from time to time,
Tenant will execute and deliver to Landlord, within ten (10) days after Tenant's
receipt of  Landlord's  written  request,  certificates,  an example of which is
attached hereto as Exhibit D,  certifying:  (i) the date of

                                      -12-

<PAGE>

commencement of this Lease; (ii) the fact that this Lease is unmodified  (except
as the  certificate  specifies) and in full force and effect;  (iii) the date to
which the sums payable  under this Lease have been paid;  (iv) that there are no
current  defaults  under  this  Lease by either  Landlord  or  Tenant  except as
specified;  and (v) such other matters as Landlord requests.  This certification
may be relied upon by any actual or prospective Mortgagee or purchaser of all or
part of the  Building  or any  interest  therein or in  Landlord.  Failure to so
execute and deliver said certificate shall be deemed a default under this Lease.

22. SIGNS. Intentionally deleted.

23. SURRENDER OF PREMISES.  As soon as its right to possession ends, Tenant will
surrender the Premises to Landlord with all  originally  painted  interior walls
washed,  or re-painted if marked or damaged and other  interior  walls and doors
cleaned and repaired or replaced, all carpets cleaned and in good condition, the
HVAC  equipment  inspected,  serviced and  repaired by a reputable  and licensed
service  firm and all floors  cleaned and waxed and  otherwise in as good repair
and  condition as when Tenant first  occupied,  except for  reasonable  wear and
tear,  and for damage or  destruction by fire or other casualty for which Tenant
is not otherwise  responsible.  Tenant will concurrently deliver to Landlord all
keys to the  Premises,  and restore any locks which it has changed to the system
which existed at the  commencement of the Term. If possession is not immediately
surrendered  by  Tenant,  Landlord  may 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.

         23.1.  Leasehold  Improvements  and  Fixtures.  At  the  expiration  or
termination  of  the  Term,  Landlord  may  require  the  removal  of any or all
Alterations,  personal  property  and  equipment  from  the  Premises,  and  the
restoration  of the Premises to its  condition  as when Tenant  first  occupied,
except for  reasonable  wear and tear,  at  Tenant's  expense.  Unless  Landlord
requires  their  removal  pursuant to this Lease,  all  Alterations  made to the
Premises  shall  remain  upon  and  be  surrendered  with  the  Premises  at the
expiration or termination of the Term. All personal property and equipment on or
about the Premises,  other than that which is affixed to the Premises so that it
cannot be removed without material damage to the Premises or the Building, shall
be  removed  from  the  Premises  by  Tenant  (if it is not in  default)  at the
expiration  or  termination  of  the  Term.  All  removals  by  Tenant  will  be
accomplished in a good and workmanlike manner so as not to damage any portion of
the Premises or Building, and Tenant will promptly repair and restore all damage
done.  If Tenant does not so remove any property  which it has the right or duty
to remove,  Landlord may immediately either claim it as abandoned  property,  or
remove,  store and dispose of it in any manner Landlord may choose,  at Tenant's
cost and without liability to Tenant or any other party.

         23.2.  Holding  Over.  If Tenant  does not  surrender  the  Premises as
required and holds over after its right to possession ends,  Tenant shall become
a tenant at sufferance only, at a monthly rental rate equal to one hundred fifty
percent  (150%) of the total rent  payable in the last prior full month,  or the
then  existing  fair  market  rental,  whichever  is greater,  without  renewal,
extension or expansion rights, and otherwise subject to the terms, covenants and
conditions  herein specified,  so far as applicable.  Nothing other than a fully
executed written agreement of the parties creates any other relationship. Tenant
is liable  for  Landlord's  loss,  costs and  damage  from  such  holding  over,
including,  without  limitation,  those  from  Landlord's  delay  in  delivering
possession to other parties. These provisions are in addition to other rights of
Landlord hereunder and as provided by law.

24. PROFESSIONAL FEES. Landlord shall be entitled to reasonable  attorneys' fees
and all other  costs and  expenses  incurred in the  preparation  and service of
notices of default and consultations in connection  therewith,  whether or not a
legal action is subsequently  commenced in connection with such default.  In any
dispute between the parties (whether or not litigated)  arising hereunder or out
of Tenant's use or occupancy of the Premises,  the prevailing party's reasonable
costs and expenses  (including  fees of attorneys  and experts)  will be paid or
reimbursed by the unsuccessful party.

25. GENERAL PROVISIONS.

                                      -13-

<PAGE>

         25.1. Mortgagee  Protection.  Tenant shall not sue Landlord for damages
or exercise  any right to  terminate  until (a) it gives  written  notice to any
Mortgagee  whose name and  address  have been  furnished  to  Tenant,  and (b) a
reasonable  time for remedying the act or omission  giving rise to such suit has
elapsed  following  the giving of the notice,  without the same being  remedied.
During that time,  Landlord  shall not be  considered  in default,  and Landlord
and/or any Mortgagee and/or their employees, agents or contractors may enter the
Premises and do therein whatever may be necessary to remedy the act or omission.

         25.2. Transfer of Landlord's Interest. Landlord may transfer, assign or
convey any or all of its  interest  in the  Building  or its  rights  under this
Lease.  Upon  transfer  of its rights  under this  Lease,  Landlord is freed and
relieved of all then future  obligations  under this Lease, the transferee shall
be deemed to have assumed those obligations,  and Tenant will look solely to the
successor  to  Landlord.  This Lease  shall inure to the benefit of and bind all
parties hereto and their respective successors and assigns.

         25.3. Waiver.  Tenant waives any right it may now or hereafter have (i)
to redeem the Premises or to have a continuance of this Lease after  termination
of the Lease,  Tenant's  right of  occupancy  or the Term (ii) for  exemption of
property  from  liability for debt or for distress for rent,  (iii)  relating to
notice or delay in levy of execution in case of eviction for nonpayment of rent.
The parties agree that in any litigation  under this Lease for the  relationship
it creates, the judge, rather than the jury, shall determine any matters of fact
relating to  Transfers,  bankruptcy or similar  matters or to the  structural or
mechanical systems of the Building.

         25.4.  Identification  of  Tenant.  If  there is more  than  one  party
constituting  Tenant or any Guarantor,  their obligations are joint and several,
and  Landlord  may proceed  against  any one or more of them  before  proceeding
against the others,  nor shall any party  constituting  Tenant or  Guarantor  be
released for any reason whatsoever, including, without limitation, any amendment
of this  Lease,  any  forbearance  by  Landlord  or waiver of any of  Landlord's
rights,  the  failure to give any party  constituting  Tenant or  Guarantor  any
notices,  or the  release  of any  party  liable  for the  payment  of  Tenant's
obligations.  If there is more than one party  constituting  Tenant, any of them
acts for all others in every  regard with respect to this Lease  (including  but
not limited to any renewal, extension, expiration, termination or modification).

         25.5. Interpretation of Lease. Tenant acquires no rights by implication
from  this  Lease,  and is not a  beneficiary  of any  past,  current  or future
agreements between Landlord and third parties. Surrender or cancellation of this
Lease shall not work a merger, and shall, at Landlord's option, assign to it all
subleases  or  subtenancies.  The  delivery of keys to  Landlord  or  Landlord's
Managing  Agent  is not a  termination  of  this  Lease  or a  surrender  of the
Premises. Headings in this Lease are for convenience only, and do not affect the
meaning of the text. Unless context indicates otherwise,  words of any gender or
grammatical number include all genders and numbers. Where context conflicts with
the  definition  of any term,  context will  control,  but only for that use and
related  uses.  If any  provision  of this Lease or any  application  thereof is
invalid,  void or illegal,  no other provision or application shall be affected.
Time is of the essence of every provision of this Lease.  California law governs
this Lease. Neither party may record this Lease or a copy or memorandum thereof.
Submission  of this  Lease to Tenant is not an offer,  and  Tenant  will have no
rights  hereunder until each party executes a counterpart and delivers it to the
other party.

         25.6.  Limitation on Liability.  Landlord's rights hereunder are solely
for  Landlord's  benefit,  and  Landlord  has no duty to  exercise  them for the
benefit of Tenant or others.  Any  liability  of Landlord  to Tenant  under this
Lease,  or arising from the  relationship  under it, is limited to the lesser of
(i) the value of the equity  interest of Landlord in the Building or (ii) twenty
percent  (20%)  of the  value  of the  Building,  and  Landlord  and  Landlord's
employees, officers, directors,  shareholders,  partners and agents shall not be
personally  liable  for any  deficiency;  but this  does  not  limit or deny any
remedies which do not involve  personal  liability.  Tenant shall not,  however,
name  Landlord's  employees,  officers,  directors,  shareholders,  partners and
agents as a defendant in any action seeking to impose personal  liability on any
one or more of them.  If Tenant  proposes any action which  requires  Landlord's
consent and such

                                      -14-

<PAGE>

consent  is  impermissibly  withheld,  denied  or  delayed,  Tenant  may seek an
injunction  or  specific  performance  but  shall  not be  entitled  to  damages
therefor.

         25.7. Financial Statements.  Tenant represents,  warrants and covenants
that  financial  statements  heretofore or hereafter  furnished to Landlord,  in
connection with this Lease, are accurate and are not materially  misleading.  At
any time during the Term, Tenant shall, upon ten (10) days prior written notice,
provide Landlord with a current financial statement and financial  statements of
the two (2) years prior to the current financial statement year, and prepared in
accordance  with  generally  accepted  accounting  principles  and,  if  such is
Tenant's normal practice, audited by an independent certified public accountant.

         25.8.  Quiet  Enjoyment.  If Tenant pays all sums and  performs all its
other obligations  under this Lease,  Tenant shall and may peaceably and quietly
have, hold and enjoy the Premises,  subject to this Lease and to rights to which
the  Lease  is  subordinate.  Tenant  acknowledges  that  it may be  subject  to
inconveniences  typical of  projects  under  development  such as  construction,
maintenance  and repair in other areas of the Project and Building,  and further
acknowledges  that the Building and the Project are subject to sight,  sound and
overflight by general aviation aircraft.

         25.9. Payments and Notices.  Any notice or document shall be considered
received when  personally  delivered by mail,  messenger,  overnight  courier or
otherwise  to,  or  whether  actually  received  or not,  on the third day after
deposit in the United  States mail,  postage  prepaid,  registered  or certified
mail,  return  receipt  requested,  addressed  to  the  parties  hereto  at  the
respective addresses set forth on the signature page of this Lease, or to Tenant
at the Premises,  or at such other address as they may specify from time to time
by written notice delivered in accordance with this Paragraph 25.9,  except that
if such day is not a business  day,  the notice or document  will be  considered
delivered on the next business  day. All payments  required to be made by Tenant
to Landlord are to be paid,  without prior demand except as may be specified and
without any setoff, deduction or counterclaim whatsoever, in legal tender of the
United  States of  America at the  address  set forth on the  invoice  or, if no
invoice is submitted or no address is set forth, at the address for the Landlord
set forth on this Lease or at any other  address as Landlord  may  specify  from
time to time by written notice in accordance with this Paragraph 25.9.

         25.10. Late Payments.  If any amounts due hereunder from Tenant are not
received by  Landlord  within ten (10) days after said  amounts are due,  Tenant
shall also pay to Landlord a late  charge of six  percent  (6%) of all such past
due amounts for which the parties agree is a fair and reasonable estimate of the
extra costs (including,  without limitation,  processing and accounting charges)
Landlord will incur by reason of the late payment. Acceptance of any late charge
shall not  constitute a waiver of Tenant's  default with respect to such overdue
amount,  or  prevent  Landlord  from  exercising  any of its  other  rights  and
remedies.  Any amounts overdue from Tenant  hereunder shall accrue interest from
the date due at the Prime Rate plus two  percent  (2%) per  annum.  If Tenant is
late in the payment of Base Rent for two (2)  consecutive  months,  Landlord may
require Tenant to pay Base Rent in advance on a quarterly basis. If any check or
other payment device is returned due to insufficient  funds or any other reason,
Landlord may require all future  payments to be made by money order or cashier's
check.

         25.11.  Rules and  Regulations.  Tenant shall comply with the Rules and
Regulations (as changed from time to time as therein  provided)  attached hereto
as Exhibit E.

         25.12.  Rights  Reserved  by  Landlord.  In  addition  to other  rights
retained or  reserved,  Landlord  reserves  the  following  rights,  exercisable
without  notice  and  without  liability  to Tenant  and  without  effecting  an
eviction,   constructive  or  actual,   or  in  any  way  diminishing   Tenant's
obligations:  (a) to  change  the name or  street  address  of the  Building  or
Project; (b) to install and maintain, modify or remove any signs on the exterior
and interior of the Building or Project; (c) to designate and approve,  prior to
installation,  all types of  interior  and  exterior  window  treatments  and to
control  all  internal  lighting  that may be visible  from the  exterior of the
Building; (d) the exclusive right to designate,  limit, restrict and control any
business and any service in or to the Project or its tenants;  (e) to keep,  and
to use in appropriate instances,  keys to all doors within and into the Premises
(no locks  shall be  changed or added  without  the  prior,  written  consent of
Landlord); (f) to decorate and make repairs,  alterations or additions,  whether

                                      -15-

<PAGE>

structural or  otherwise,  in and about any part of the Project and to enter the
Premises for these purposes and,  during such work, to temporarily  close doors,
entryways,  public space and corridors in the Building or Project,  to interrupt
or  temporarily  suspend  Building  services  and  facilities  and to change the
arrangement  and  location  of  entrances  or  passageways,  windows,  doors and
doorways,  corridors,  elevators,  stairs, toilets, or other public parts of the
Building or Project;  (g) to approve the weight,  size and location of safes and
other heavy  equipment  and articles in and about the Premises and the Building,
and to  require  all such  items and  furniture  to be moved into and out of the
Building  and  Premises  only at times and in such  manner as  Landlord  directs
(movement  of Tenant's  property is entirely at the risk and  responsibility  of
Tenant,  and Landlord  reserves the right to require permits before allowing any
property  to be  moved  into or out of the  Building);  (h) to have  access  for
Landlord and other  tenants of the Building to any mail  receptacles  located on
the Project  according to the rules of the United States Postal Service;  (i) to
close any part of the Common Areas to the extent necessary in Landlord's opinion
to prevent the accrual of any prescriptive rights, to temporarily close any part
of the Common  Areas to repair  and  maintain  them or for any other  reasonable
purpose,  or to  change  the  nature  of the  Common  Areas,  including  without
limitation  changes in the  location,  size,  shape,  and  number of  driveways,
entrances,  parking spaces, parking areas, loading and unloading areas, ingress,
egress,  direction of traffic,  landscaped areas, and walkways;  and (j) to take
all reasonable  measures  Landlord  considers  advisable for the security of the
Project and its occupants.

         25.13.  Responsibility  for Others.  Where either  party waives  rights
against  the other  party,  it also  waives the same  rights  against  the other
party's  employees,   officers,  directors,   shareholders,   partners,  agents,
contractors  and invitees.  The waiver shall be considered a waiver on behalf of
the  party  making  it,  of all that  party's  employees,  officers,  directors,
shareholders,  partners and agents,  and of anyone  claiming  under any of them,
including insurers and creditors. Wherever in this Lease Tenant agrees not to do
a  particular  thing,  Tenant also agrees not to permit its  employees,  agents,
contractors or invitees to do so.

         25.14.  Landlord's Costs.  Where Tenant is required to pay or reimburse
Landlord  for the  costs of any  item,  the cost  shall  be the  reasonable  and
customary  charge  established  by  Landlord  from  time to  time,  including  a
reasonable  allocation of Landlord's overhead,  administrative and related costs
associated with the ownership and operation of the Building.  Failure to pay any
reimbursable  cost shall be treated as a failure to pay rent. In connection with
any request by Tenant for the consent of Landlord to an Alteration,  Transfer or
other act  proposed by Tenant  under this  Lease,  Tenant  shall pay  Landlord's
reasonable  costs and  expenses  incurred  in  connection  therewith,  including
attorneys', architects', engineers' and other consultants' fees.

         25.15. Invoices. Tenant will promptly notify Landlord of any dispute it
may have  regarding  Landlord's  invoices.  If Tenant  does not notify  Landlord
within thirty (30) days after  receiving the invoice,  it shall be  conclusively
deemed to have agreed to the invoice and all underlying facts.

         25.16.  Force Majeure.  When a period of time is herein  prescribed for
action to be taken by Landlord, Landlord shall not be liable or responsible for,
and there is excluded  from the  computation  for 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 cause of any kind
whatsoever  which are beyond the control of Landlord.  Subject to the  preceding
sentence, time is of the essence of every part of this Lease.

         25.17.  Lender  Modification.  Tenant  agrees to make  such  reasonable
modifications to this Lease as may reasonably be required in connection with the
obtaining of normal financing or refinancing of the Building.

         25.18.  Negotiated  Transaction.  The parties mutually acknowledge that
this Lease has been  negotiated  at arm's length.  The  provisions of this Lease
shall be deemed to have been  drafted by all of the parties and this Lease shall
not be interpreted or constructed against any party solely by virtue of the fact
that such party or its counsel was responsible for its preparation.

                                      -16-

<PAGE>

THIS LEASE  CONTAINS  ALL  AGREEMENTS  OF THE PARTIES  CONCERNING  THIS  SUBJECT
MATTER,  SUPERSEDING ANY SUCH PRIOR AGREEMENTS,  REPRESENTATIONS  OR WARRANTIES,
AND MAY BE  AMENDED  OR  MODIFIED  ONLY BY A  WRITTEN  AGREEMENT  SIGNED BY BOTH
PARTIES.

         IN WITNESS  WHEREOF,  the parties hereto have executed this Lease as of
the date first above written.

LANDLORD'S ADDRESS                     LANDLORD:

c/o RNM Properties                     RNM LAKEVILLE, L.P., a California Limited
135 Main Street, Suite 1140            Partnership
San Francisco, CA 94105
                                       By RNM PETALUMA, INC., a California
                                       corporation, its Managing General Partner
Attention:  John R. McNulty

                                       By ______________________________________
                                             John R. McNulty, Its President

TENANT'S ADDRESS                       Date ____________________________________

At the Premises:                       TENANT:
Attention:  Bruce Wilson

Tenant  and  the  person  executing    HEALTHY PLANET PRODUCTS, INC., a
this  Lease  on   Tenant's   behalf    Delaware corporation
represent and warrant that they are
duly authorized and empowered so to
execute and deliver this Lease, and
that  this  Lease is  binding  upon    By ______________________________________
Tenant  in   accordance   with  its                (signature)
terms.

                                          ______________________________________
                                                   (print name)

                                       Its _____________________________________
                                                  (insert title)

                                       Date ____________________________________

                                      -17-

<PAGE>

                                    ADDENDUM
                                    TO LEASE

This  Addendum is made and entered  into by and between RNM  Lakeville,  L.P., a
California Limited Partnership,  as Landlord, and HEALTHY PLANET PRODUCTS, INC.,
a Delaware corporation,  as Tenant, and is dated as of the date set forth on the
first page of the Lease  between  Landlord and Tenant to which this  Addendum is
attached (the "Lease").  The promises,  covenants,  agreements and  declarations
made and set forth  herein  are  intended  to and shall  have the same force and
effect as if set forth at length in the body of the Lease.  To the  extent  that
the provisions of this Addendum are  inconsistent  with the terms and conditions
of the Lease, the terms of this Addendum shall control.

26. TENANT'S EXTENSION OPTION.  Tenant's options to extend the term of the Lease
under the Existing Lease have lapsed and are no longer in effect.  Tenant has no
further option to extend.

27. PARKING.  Tenant shall be entitled to the  non-exclusive use of up to thirty
(30) unreserved and unassigned  parking spaces in the Common Areas in accordance
with  Landlord's  rules and  regulations as may be amended from time to time and
such areas as are designated by Landlord.  Notwithstanding  the above,  Landlord
shall  designate  two parking  spaces at the front of the  Building for Tenant's
visitors,  and the  other  spaces  shall  located  along the side or rear of the
Building.  Tenant  shall not park any  vehicle  other  than  ordinary  passenger
vehicles in the Common Areas,  except for loading purposes.  Loading and loading
is permitted only on designated loading docks or areas.  Tenant shall not at any
time park or permit the parking of Tenant's  vehicles or trucks, or the vehicles
or trucks of Tenant,  its  employees,  invitees,  suppliers  or  others,  in any
portion of the Common Area not  designated  by Landlord  for such use by Tenant.
Tenant shall not abandon any inoperative vehicles or equipment on any portion of
the Common Area, nor shall Tenant, its employees,  invitees, suppliers or others
park or store any vehicle  (permitted  size or  otherwise) on any portion of the
Common Area,  including  designated  parking  areas,  unattended  for any period
longer than twenty-four (24) hours. Vehicles parked in violation of this Section
shall be subject to towing at Tenant's expense.

28. HAZARDOUS MATERIAL.

         28.1. Use Restrictions.  Tenant shall not use,  generate,  manufacture,
produce,  store,  release,  discharge  or  dispose  of,  on,  under or about the
Premises, or transport to or from the Premises, any Hazardous Materials or allow
its employees, Agents, contractors, invitees or any other person or entity to do
so except in full compliance with all Federal, state and local laws, regulations
and ordinances and this Agreement.  The term "Hazardous Materials" shall include
without  limitation:  (1) Those  substances  included  within the definitions of
"hazardous  substances",  "hazardous  materials",  "toxic  substances" or "solid
waste" under CERCLA,  RCRA and the Hazardous  Materials  Transportation  Act, 49
U.S.C.  Sections 1801, et seq. and in the  regulations  promulgated  pursuant to
said Laws; (2) Those substances  defined as "hazardous  wastes" in Section 25117
of the California Health & Safety Code, or as "hazardous  substances" in Section
25316 of the California Health & Safety Code, and in the regulations promulgated
pursuant  to said  Laws;  (3)  Those  substances  listed  in the  United  States
Department of  Transportation  Table (49 CFR 172.101 and amendments  thereto) or
designated by the  Environmental  Protection Agency (or any successor agency) as
hazardous substances; (4) Such other substances,  materials and wastes which are
or become regulated under applicable  local,  state or federal Law or the United
States government, or which are or become classified as hazardous or toxic under
federal,  state or local Laws or  regulations;  and (5) Any  material,  waste or
substance  which  is  (i)  petroleum,   (ii)  asbestos,   (iii)  polychlorinated
biphenyls, (iv) designated as a "hazardous substance" pursuant to Section 311 of
the Clean Water Act of 1977, 33 U.S.C. Sections 1251, et seq. (33 U.S.C. Section
1321) or listed  pursuant  to  Section  307 of the  Clean  Water Act of 1977 (33
U.S.C. Section 1317), (v) flammable explosives, or (vi) radioactive materials.

         28.2.  Tenant's  Indemnity.  Tenant shall be liable to Landlord for and
indemnify   and  hold   Landlord   harmless   against  all  damages   (including
investigation and remedial costs), liabilities,  losses

                                   ADDENDUM-1

<PAGE>

(including  diminution of value of the Premises),  fines,  penalties,  fees, and
claims arising out of Tenant's and Tenant's agents'  activities  associated with
Hazardous  Materials,  including all costs and expenses  incurred by Landlord in
remediating,  cleaning up,  investigating  or responding to any  governmental or
third party claims,  demands, orders or enforcement actions. In the event Tenant
and/or  Tenant's   agents'   activities  with  Hazardous   Materials   create  a
contamination  problem on or  adjacent  to the  Premises,  the  Building  or the
Project, Tenant shall promptly commence investigation and remedial activities to
fully clean up the problem.  If appropriate or required by law, these activities
shall be conducted in conjunction  with Federal,  state and local  oversight and
approvals. If any action of any kind is required or requested to be taken by any
governmental  authority to clean-up,  remove  remediate or monitor any Hazardous
Materials  (the  presence  of which is the  result of the acts or  omissions  of
Tenant or its Agents) and such action is not completed  prior to the  expiration
or  earlier   termination  of  the  Lease,   Tenant  shall  be  deemed  to  have
impermissibly  held over until such time as such  required  action is completed,
and Landlord shall be entitled to all damages directly or indirectly incurred in
connection  with such  holding  over,  including,  without  limitation,  damages
occasioned  by the  inability  to re-let the Premises or a reduction of the fair
market and/or rental value of the Premises.

         28.3.  Assignment  and  Subletting.  It shall not be  unreasonable  for
Landlord to withhold its consent to any proposed assignment or subletting if (i)
the proposed assignee's or subtenant's  anticipated use of the Premises involves
the storage, generation,  discharge, transport, use or disposal of any Hazardous
Material in a greater  intensity and scope than Tenant's  then-existing  use, or
(ii) the proposed assignee or subtenant has been required by any prior landlord,
Lender or  governmental  authority  to  "clean-up"  or remediate  any  Hazardous
Material and has failed to do so, or (iii) the proposed assignee or subtenant is
subject to a criminal  investigation  or enforcement  order or proceeding by any
government  authority  in  connection  with  the  use,  generation,   discharge,
transport, disposal or storage of any Hazardous Material.

         28.4.  List of Hazardous  Materials.  Upon request of Landlord,  Tenant
shall provide  Landlord with a list of Hazardous  Materials  (and the quantities
thereof)  which  Tenant  uses or  stores  (or  intends  to use or  store) on the
Premises, which list shall be attached to this Lease as Exhibit F.

                  (a) Prior to Tenant using,  handling,  transporting or storing
any Hazardous Material at or about the Premises, Tenant shall submit to Landlord
a  Hazardous  Materials  Management  Plan  ("HMMP")  for  Landlord's  review and
approval,  which approval  shall not be  unreasonably  withheld.  The HMMP shall
describe:  (aa) the quantities of each material to be used, (bb) the purpose for
which each material is to be used,  (cc) the method of storage of each material,
(dd) the method of  transporting  each  material  to and from the  Premises  and
within the  Premises  (ee) the methods  Tenant will employ to monitor the use of
the material and to detect any leaks or  potential  hazards,  and (ff) any other
information any department of any governmental  entity (city,  state or federal)
requires prior to the issuance of any required permit for the Premises or during
Tenant's  occupancy of the Premises.  Landlord may, but shall have no obligation
to review and approve the foregoing  information  and HMMP,  and such review and
approval  or failure  to review  and  approve  shall not act as an  estoppel  or
otherwise  waive  Landlord's  rights  under this Lease or relieve  Tenant of its
obligations under this Lease. If Landlord determines in good faith by inspection
of the  Premises or review of the HMMP that the methods in use or  described  by
Tenant  are not  adequate  in  Landlord's  good  faith  judgment  to  prevent or
eliminate the  existence of  environmental  hazards,  then Tenant shall not use,
handle,  transport,  or store such Hazardous  Materials at or about the Premises
unless and until such  methods are  approved by Landlord in good faith and added
to an approved HMMP.  Once approved by Landlord,  Tenant shall  strictly  comply
with the HMMP and  shall not  change  its use,  operations  or  procedures  with
respect to Hazardous Materials without submitting an amended HMMP for Landlord's
review and approval as provided above.

                  (b) Tenant shall pay to Landlord  when Tenant  submits an HMMP
(or  amended  HMMP) the amount  reasonably  determined  by Landlord to cover all
Landlord's costs and expenses  reasonably incurred in connection with Landlord's
review of the HMMP which costs and expenses shall  include,  among other things,
all reasonable out-of-pocket fees of attorneys, architects, or other consultants
incurred by Landlord in connection with Landlord's review of the HMMP.  Landlord
shall have no  obligation  to consider a request for consent to a proposed  HMMP
unless  and until  Tenant  has paid all

                                   ADDENDUM-2

<PAGE>

such costs and expenses to Landlord  irrespective of whether Landlord consent to
such proposed HMMP.  Tenant shall pay to Landlord on demand the excess,  if any,
of such costs and expenses actually incurred by Landlord over the amount of such
costs and  expenses  actually  paid by Tenant  over the  amount  such  costs and
expenses actually incurred by Landlord. Tenant shall immediately notify Landlord
or any inquiry, test, investigation, enforcement proceeding by or against Tenant
or the Premises concerning any Hazardous Material. Any remediation plan prepared
by or on behalf of Tenant must be submitted to Landlord  prior to conducing  any
work pursuant to such plan and prior to submittal to any  applicable  government
authority and shall be subject to Landlord's  consent.  Tenant acknowledges that
Landlord,  as the owner of the Property,  at its  election,  shall have the sole
right to negotiate,  defend, approve and appeal any action taken or order issued
with regard to any Hazardous Material by any applicable  governmental authority.
Landlord   shall  have  the  right  to  appoint  a  consultant   to  conduct  an
investigation  to  determine  whether  any  Hazardous  Material  is being  used,
generated,  discharged,  transported  to or from,  stored or disposed of in, on,
over, through, or about the Premises, in an appropriate and lawful manner and in
compliance with the requirements of this Lease.  Tenant,  at its expense,  shall
comply with all reasonable recommendations of the consultant required to conform
Tenant's use, storage or disposal of Hazardous  Materials to the requirements of
applicable Law or to fulfill the obligations of Tenant hereunder.

         28.5. Landlord's Indemnity.  Landlord shall be liable to Tenant for and
indemnify and hold Tenant harmless against all damages (including  investigation
and  remedial  costs),  liabilities  and claims  arising out of  Landlord's  and
Landlord's agents' activities  associated with Hazardous Materials,  and arising
out of any  Hazardous  Materials  existing  on or under the  Building  as of the
Commencement  Date,  including  all costs  and  expenses  incurred  by Tenant in
remediating,  cleaning up,  investigating  or responding to any  governmental or
third party claims, demands, orders or enforcement actions.

         28.6.  Provisions Survive  Termination.  Upon the expiration or earlier
termination of the Lease,  Tenant,  at its sole cost, shall remove all Hazardous
Materials  from  the  Premises  that  Tenant  or its  Agents  introduced  to the
Premises.  The  provisions  of this Section 28 shall  survive the  expiration or
termination of this Lease.

29. COMMON AREAS.

                  (a)  Landlord  hereby  grants to  Tenant,  for the  benefit of
Tenant and its employees,  suppliers,  shippers,  customers and invitees, during
the term of this Lease,  the  non-exclusive  right to use, in common with others
entitled to such use, the Common Areas as they exist from time to time,  subject
to any rights,  powers,  and  privileges  reserved  by Landlord  under the terms
hereof or under the terms of any rules and regulations or restrictions governing
the use of the Project. Under no circumstances shall the right herein granted to
use the  Common  Area be deemed  to  include  the  right to store any  property,
temporarily  or  permanently,  in the Common Area or to construct or install any
improvements in the Common Area. Any such storage shall be permitted only by the
prior written consent of Landlord or Landlord's  designated agent, which consent
may be revoked at any time.  In the event that any  unauthorized  storage  shall
occur,  the Landlord shall have the right,  without notice,  in addition to such
other  rights and remedies  that it may have,  to remove the property and charge
the cost to  Tenant,  which  cost  shall be  immediately  payable  by  Tenant to
Landlord upon demand by Landlord.

                  (b) Landlord or such other  person(s) as Landlord may appoint,
shall have the  exclusive  control and  management of the Common Areas and shall
have the right,  from time to time,  to  establish,  modify,  amend and  enforce
reasonable rules and regulations with respect thereto. Tenant agrees to abide by
and  conform  to all  such  rules  and  regulations,  as  well  as  any  private
conditions,  covenants,  and  restrictions  of public  record  now or  hereafter
affecting the Premises and any amendment  thereof,  and to cause its  employees,
suppliers, shippers, customers and invitees to abide and conform. Landlord shall
not be  responsible  to  Tenant  for the  non-compliance  with  said  rules  and
regulations by other tenants or authorized users of the Project.  Any failure by
Tenant or its agents,  employees or  representatives  to observe and comply with
the rules and  regulations  established  by Landlord  with respect to the Common
Areas shall be a default by Tenant hereunder.

                                   ADDENDUM-3

<PAGE>

                  (c)  Landlord   shall  have  the  right  in  Landlord's   sole
discretion,  from  time  to  time:  (i) to make  changes  to the  Common  Areas,
including,  without limitation,  changes in the location, size, shape and number
of driveways  entrances,  parking spaces,  parking areas,  loading and unloading
areas,  ingress,  egress,  direction of traffic,  landscaped areas and walkways;
(ii) to close temporarily any of the Common Areas for maintenance  purposes,  so
long as reasonable access to the Premises remains available;  (iii) to designate
other land  outside  the  boundaries  of the  Project to be a part of the Common
Areas;  (iv) to add additional  buildings and  improvements to the Common Areas;
(v) to use the Common  Areas while  engaged in making  additional  improvements,
repairs or alterations to the Project, or any portion thereof; (vi) to close, at
reasonable  times,  all or any portion of the parking  areas for any  reasonable
purpose,  including without limitation,  the prevention of a dedication thereof,
or the accrual of the rights of any person or public  therein;  and, (vii) to do
and perform  such other acts and make such other  changes in, to or with respect
to the Common  Areas and the Project as Landlord  may, in the  exercise of sound
business judgment, deem to be appropriate.

30. EXISTING LEASE.

         30.1.   Conditions  to  Acceptance.   As  material   consideration  for
Landlord's  agreeing to  supercede  the Existing  Lease with this Lease,  Tenant
shall perform the following:

                  (a)  Surrender to Landlord the 34,181  square feet of Rentable
Area  designated on Addendum B  ("Surrendered  Premises") no later than December
31,  1999 (the  "Surrender  Date"),  free of all  subtenants,  in good and clean
condition,  with light  fixtures,  doors,  walls and floors  clean,  patched and
otherwise in good repair  (including repair of loading dock doors) and otherwise
in  conformance  with the provisions of the Existing  Lease,  except that Tenant
shall not (i) remove or disable any cabling or communications  wiring within the
Surrendered Premises or (ii) remove any improvements,  fixtures, trade fixtures,
additions or alterations from the Surrendered Premises,  except for its personal
property and trade fixtures which are not affixed to the  Surrendered  Premises.
Tenant shall restore any and all damage to the  Surrendered  Premises  resulting
from the removal of its  property.  Tenant shall fully  perform its  obligations
with respect to the Existing Lease through the Surrender Date, including payment
of rent thereunder for the Premises and the Surrendered Premises.

                  (b) Prior to the  Surrender  Date,  Tenant  shall  construct a
demising  wall between the  Surrendered  Premises and the Premises in accordance
with such plans as are approved by Landlord and in  accordance  with  applicable
laws, rules, regulations, ordinances, and building codes ("Tenant Work"). In the
event  Tenant has not  completed  the  demising  wall by January  15,  2000,  or
Landlord  reasonably believes Tenant will not complete such construction by said
date,  then Landlord,  following  three (3) days notice to Tenant,  shall assume
control of such construction,  and Tenant shall reimburse Landlord for all costs
and expenses incurred by Landlord in connection with such construction, together
with an administrative fee equal to 5% of such Landlord costs.  Further,  Tenant
shall  reimburse  Landlord for the costs of separating  the  electrical  service
(including  installing  separate  meters) for the  Surrendered  Premises and the
Premises.

                  (c) Tenant shall pay to Landlord  $61,449.60 (the "Termination
Payment") in four (4) equal monthly installments of $15,362.40 each on the first
day of each calendar month commencing on the Commencement  Date.  Failure to pay
all or any  portion of the  Termination  Payment  may,  at the  election  of the
Landlord, be deemed a failure to pay rent under this Lease.

         30.2. Entry by Landlord.  Notwithstanding  the provisions of the Lease,
commencing upon execution of this Agreement, Landlord, following written or oral
notice  to  Tenant,  may  enter  upon  the  Surrendered  Premises  to  show  the
Surrendered  Premises  to  prospective  tenants  and measure and plan for future
tenants. Further, it Tenant is not occupying the Surrendered Premises,  Landlord
may  enter  the  Surrendered   Premises  to  commence   construction  of  tenant
improvements therein,  without such entry being deemed an early surrender of the
Surrendered  Premises, a trespass by Landlord, or any interference with Tenant's
use and quiet enjoyment of the Surrendered Premises or Premises.

                                   ADDENDUM-4

<PAGE>

                                    EXHIBIT A

                                      LEASE
                                   Definitions

         Building  means  the  building  in  which  the  Premises  are  located,
identified  as  1720-1736  Corporate  Circle,  Petaluma,  California.  The total
Rentable Area of the Building is 78,269 square feet.

         Business days means Monday through Friday, except holidays;  "holidays"
means  those  holidays  specified  by the laws of the United  States or State of
California,  and all holidays to which maintenance employees of the Building are
entitled from time to time under their union contract or other agreement.

         CC&Rs means all  restrictions of public record  affecting the Building,
Project or  Tenant's  use of the  Premises,  including  but not  limited to that
certain   Amended  and  Restated   Declaration  of  Covenants,   Conditions  and
Restrictions  recorded  on March 23,  1998,  in the  Official  Records of Sonoma
County California as serial number 98-28875, as amended from time to time.

         Common Areas means all areas within the Building and the Project  which
are not  designated  for the  exclusive  use of  Tenant,  Landlord  or any other
tenant,  including but not limited to parking areas, loading and unloading areas
and docks,  platforms,  trash areas, roadways,  sidewalks,  landscaping,  ramps,
driveways,  recreations  areas,  greenbelts,  common  entrances,  restrooms  and
accessways,  and the common pipes,  conduits,  wires and  appurtenant  equipment
serving  the  Premises,  and similar  areas and  facilities  appurtenant  to the
Building and the Project.

         Guarantor means any guarantor of any of Tenant's obligations under this
Lease.

         Lease  Years  means  successive  periods of twelve  (12) full  calendar
months,  beginning on the Commencement Date. If the Commencement Date is not the
first day of a month,  then the first Lease Year also includes the partial month
in which the Commencement Date occurs.

         Mortgage  means any  mortgage or Deed of Trust,  blanket or  otherwise,
covering any part of the Building.

         Mortgagee means the holder of a Mortgage.

         Operating Expenses means any and all costs,  expenses and disbursements
of every kind and character which Landlord incurs,  pays or becomes obligated to
pay at any time during the Term in connection with its ownership interest in the
Building,  Common  Areas and Project and  associated  land and  parking,  or the
operation,  maintenance,  management, repair, replacement, and security thereof;
plus, with respect to such costs,  expenses,  and  disbursements for the Project
which  do not  exclusively  pertain  to a single  building,  the  portion  which
Landlord reasonably allocates to the Building.  Operating costs include, without
limitation,  any and all assessments Landlord must pay pursuant to the CC&Rs and
any other covenants, conditions or restrictions, reciprocal easement agreements,
tenancy-in-common  agreements or similar  restrictions and agreements  affecting
the Building or the Project;  rent taxes,  gross receipt taxes (whether assessed
against  Landlord or assessed  against  Tenant and paid by  Landlord,  or both);
water and sewer charges;  accounting,  legal and other  consulting fees; the net
cost and  expense of  insurance,  including  loss of rents  coverage,  for which
Landlord is responsible  hereunder or which Landlord or any Mortgagee reasonably
deems necessary or desirable  (including losses borne by Landlord as a result of
deductibles  carried by Landlord under any insurance policy or self insurance by
Landlord);  utilities not paid directly by Tenant;  security;  labor;  utilities
surcharges,  or any  other  costs  levied,  assessed  or  imposed  by, or at the
direction  of, or resulting  from  statutes or  regulations  or  interpretations
thereof,  promulgated  by any  federal,  state,  regional,  municipal  or  local
government  authority in  connection  with the use or occupancy of the Building,
the Project or the Common Areas;  the cost (subject to the  exclusions set forth
below) of any equipment  used in  connection  in  operations  and of any capital
improvements; air conditioning;  waste disposal; heating, ventilating;  elevator
maintenance and supplies; materials; equipment; tools; repair and

                                    EXHIBIT A
                                    Page A-1

<PAGE>

maintenance of the Building,  including the structural  portion of the Building,
and  the  plumbing,  heating,  ventilating,  air  conditioning,  electrical  and
building  management  systems  installed or  furnished by Landlord;  maintenance
costs,  including  utilities and payroll  expenses,  rental of personal property
used in maintenance, gardening and landscaping, repaving and all other upkeep of
all Common Areas;  maintenance  of signs (other than Tenant's  signs);  personal
property taxes levied on or attributable to personal property used in connection
with the entire  Building or Project,  including  the Common  Areas;  reasonable
audit  or  verification  fees;  costs  and  expenses  of  repairs,  resurfacing,
repairing,  maintenance,  painting, lighting, cleaning, refuse removal, security
and similar items, including appropriate reserves; and costs reasonably incurred
to reduce or contest Real Property Taxes and other Operating Expenses. Operating
Expenses  shall also  include  costs  incurred in the  management  of  Building,
including  supplies,  wages and  salaries of employees  used in the  management,
operation, repair and maintenance of the Building, and payroll taxes and similar
governmental  charges with respect  thereto,  management  office  rental,  and a
management fee, which costs and fee shall not, in the aggregate,  exceed one and
one quarter percent (1.25%) of the Rent and Additional Rent hereunder, excluding
therefrom the management  fee.  Operating  Expenses paid or incurred by Landlord
during any calendar  year of the Lease term during which the  occupancy  rate in
the Project is less than  ninety-five  percent (95%) shall be adjusted upward to
reflect (i) a  ninety-five  percent (95%)  occupancy  rate for the Project , and
(ii)  assuming a tax  appraisal of the Project as though it were  completed  and
fully-occupied.

         Exclusions  from  Operating   Expenses:   Notwithstanding   the  above,
Operating Expenses shall not include the following:

                  (i) Interest, principal,  depreciation, and other lender costs
and closing costs on any mortgage or mortgages,  ground lease payments, or other
debt instrument encumbering the Building or Project;

                  (ii) Any bad debt loss, rent loss, or reserves for bad debt or
rent loss;

                  (iii) Interest or penalties resulting from late payment of any
Operating Expense by Landlord due to Landlord's negligence or willful misconduct
(unless  Landlord  in good faith  disputes a charge  and  subsequently  loses or
settles that dispute);

                  (iv) Costs  associated  with  operation of the business of the
ownership  of the  Building  or Project or entity that  constitutes  Landlord or
Landlord's  property  manager,  as  distinguished  from  the  cost  of  Building
operations, including the costs of partnership or corporate accounting and legal
matters; defending or prosecuting any lawsuit with any mortgagee, lender, ground
lessor, broker, tenant, occupant, or prospective tenant or occupant;  selling or
syndicating any of Landlord's interest in the Building or Project;  and disputes
between Landlord and Landlord's property manager;

                  (v) Landlord's  general corporate or partnership  overhead and
general administrative expenses,  including the salaries of management personnel
who are not directly related to the Building or Project and primarily engaged in
the operation, maintenance, and repair of the Building or Project, except to the
extent that those costs and expenses are included in the management fees;

                  (vi)   Advertising,   promotional   expenditures  and  leasing
expenses primarily directed toward leasing tenant space in the Project;

                  (vii) Leasing commissions, space-planning costs, attorney fees
and  costs,  disbursements,  and other  expenses  incurred  in  connection  with
leasing, other negotiations,  or disputes with tenants,  occupants,  prospective
tenants,  or other prospective  occupants of the Project, or associated with the
enforcement of any leases;

                  (viii) Charitable or political contributions;

                  (ix) Costs for which Landlord is reimbursed;

                                    EXHIBIT A
                                    Page A-2

<PAGE>

                  (x) Damage or loss results from any  casualty  which  Landlord
has  covenanted  to  insure  against,   except  to  the  extent  of  deductibles
contemplated herein;

                  (xi) Any  costs or  expenses  that are  incurred  directly  or
indirectly with respect to Landlord's indemnity obligations under this Lease;

                  (xii) Fees paid to any  affiliate or party related to Landlord
to the extent such fees exceed the charges for comparable  services  rendered by
unaffiliated  third parties of comparable  skill,  stature and reputation in the
same market; and

                  (xiii) As to the costs of capital improvements,  replacements,
repairs,  equipment and other capital  costs,  all such costs shall be amortized
over the useful life of such  improvement,  replacement,  repair or equipment in
accordance with generally accepted accounting  principles together with interest
at the Prime Rate on the unamortized balance.

         Premises means the approximate area shown on Exhibit B. Landlord hereby
reserves  for its sole and  exclusive  use,  the roof,  any and all  mechanical,
electrical,  telephone and similar rooms,  janitor closets,  elevator,  pipe and
other  vertical  shafts  and  ducts,  flues,  stairwells;  the  area  above  the
acoustical  ceiling;  facilities  serving parts of the Building or Project other
than the  Premises;  and any other  area not shown on Exhibit B as being part of
the Premises.

         Prime Rate means the rate of interest  published  in the "Money  Rates"
column of Wall Street  Journal as the Prime  Rate,  as such rate may change from
time to time  (or,  if such  rate is no  longer  published  in the  Wall  Street
Journal, such reasonable substitute as Landlord may select).

         Project means the Building,  the Common Areas,  and any other buildings
or facilities owned by Landlord and operated together with the Building.

         Real  Property  Taxes means any form of general or special  assessment,
license fee,  license tax,  business license fee, any form of real estate tax or
assessment,  general, special,  ordinary or extraordinary,  and any license fee,
commercial  rental tax,  improvement  bond, levy or tax (other than inheritance,
personal  income or estate taxes)  imposed on the  Building,  the Project or any
portion  thereof by any  authority  having the direct or indirect  power to tax,
including  any  city,  county,  state  or  federal  government,  or any  school,
sanitary,  fire, street,  drainage or other improvement  district,  or any other
governmental entity or public corporation, as against (a) any legal or equitable
interest of Landlord in the Building,  the Project or any portion  thereof,  (b)
Landlord's  right to rent or other  income  therefrom,  (c) the  square  footage
thereof,  (d) the act of entering into any lease, (e) the occupancy of tenant or
tenants  generally,  or (f)  Landlord's  business of leasing the  Building,  the
Project or any  portion  thereof.  The term  "real  property  taxes"  shall also
include any tax, fee, levy, assessment or charge including,  without limitation,
any  so-called  value added tax, (i) which is in the nature of, in  substitution
for or in addition to any tax,  fee,  levy,  assessment  or charge  hereinbefore
included  within the definition of "real property  taxes," (ii) which is imposed
for a service or right not charged for prior to June 1, 1978,  or if  previously
charged for, which has been increased since June 1, 1978, (iii) which is imposed
or added to any tax or charge  hereinbefore  included  within the  definition of
real property taxes as a result of a "change in ownership" of the Building,  the
Project  or  any  portion  thereof,   as  defined  by  applicable  statutes  and
regulations,  for property tax  purposes,  or (iv) which is imposed by reason of
this transaction, any modification or change hereto or any transfer hereof.

         Tenant's Share means the  percentage of the cost of Operating  Expenses
for which  Tenant is obligated  to  reimburse  Landlord  pursuant to this Lease.
Landlord shall determine  Tenant's Share of the cost of Operating Expenses using
the following methods:  (a) by multiplying the cost of all Operating Expenses by
a fraction, the numerator of which is the number of square feet of Rentable Area
in the  Premises  and the  denominator  of which is the number of square feet of
Rentable  Area in all  buildings in the  Project;  or (b) (i) with respect to an
Operating Expense  attributable solely to the Building,  requiring Tenant to pay
that  portion  of  the  cost  of the  Operating  Expense  that  is  obtained  by
multiplying  such cost by a fraction,  the  numerator  of which is the number of
square feet of Rentable Area in the Premises and the denominator of which is the
number of square feet of Rentable Area in the entire Building, (ii) with

                                    EXHIBIT A
                                    Page A-3

<PAGE>

respect to an Operating Expense attributable to the Common Areas of the Project,
but not any  particular  building in the Project,  requiring  Tenant to pay that
portion of the cost of the  Operating  Expense  that is obtained by  multiplying
such cost by a fraction,  the numerator of which is the number of square feet of
Rentable  Area in the  Premises  and the  denominator  of which is the number of
square feet of Rentable Area in all buildings in the Project.

         Year or year means a calendar year.

                                    EXHIBIT A
                                    Page A-4

<PAGE>

                                    EXHIBIT C

                    TENANT ITEMS TO BE REMOVED AT TERMINATION

o        Gas Heaters (2)
o        Transformer
o        Two sub panels
o        Electrical conduit & wiring
o        Ceiling Electrical Drops
o        Two power disconnects
o        Telephone & Data Cabling
o        Magnetic Starter

                                    EXHIBIT C
                                    Page C-1

<PAGE>

                                    EXHIBIT E

                                 SAMPLE FORM OF
                           TENANT ESTOPPEL CERTIFICATE

         ____________________________________________      ("Tenant")     hereby
certifies to ___________ as follows:

         1.  Attached  hereto is a true,  correct and  complete  copy of a lease
dated  _______________,  19___,  between RNM Lakeville,  L.P.  ("Landlord")  and
Tenant (the "Lease"),  which demised  premises  located at  ___________________,
_____________  California (the  "Property").  The Lease is now in full force and
effect  and has been  amended,  modified,  supplemented,  extended,  renewed  or
assigned by and only by the following described agreements,  copies of which are
attached  hereto (if none, so indicate),  all of which (together with the Lease)
are hereby ratified: ___________________________________________________________
_________________________________________

         2. The term of this Lease commenced on _________,  19__ and will expire
on _______________, 19__.

         3. Tenant has accepted and is now in possession of said premises.

         4. Tenant and Landlord  acknowledge  that the Lease will be assigned to
__________ and that no modification, adjustment, revision or cancellation of the
Lease or  amendments  thereto  shall be  effective  unless  written  consent  of
________________________________________________  is  obtained,  and that  until
further notice, payments under the Lease may continue as heretofore.

         5. The amount of fixed monthly rent is $__________. Tenant is paying in
full lease  rental  which has been paid in full as of the date  hereof.  No rent
under the Lease has been paid for more than  thirty  (30) days in advance of its
due date.

         6. The amount of security deposits (if any) is $____________.  No other
security deposits have been made.

         7. All work  required to be  performed  by Landlord or Tenant under the
Lease has been performed, except for the following (if none, so indicate) ______
_________________________________________

         8. There are no  defaults on the part of the  Landlord or Tenant  under
the Lease, except for the following (if none, so indicate) _____________________
_________________________________________

         9.  Tenant  has no defense  as to its  obligations  under the Lease and
claims no setoff or counterclaim against Landlord,  except for the following (if
none, so indicate) _____________________________________________________________
_________________________________________

         10.  Tenant has no right to any  concession  (rental or  otherwise)  or
similar  compensation in connection with renting the space it occupies except as
provided in the Lease, except for the following (if none, so indicate) _________
_________________________________________

                                    EXHIBIT D
                                    Page D-1

<PAGE>

         The  foregoing   certification   is  made  with  the   knowledge   that
________________________  is about to (fund a loan to)  (purchase  the  Property
from)  Landlord and that said party is relying upon the  representations  herein
made in (funding such loan) (making such purchase).

Dated: ___________, 19___.

                                        TENANT:

                                        ________________________________________

                                        By: ____________________________________

                                        Its: ___________________________________

                                    EXHIBIT D
                                    Page D-2

<PAGE>

                                    EXHIBIT E

                              RULES AND REGULATIONS

1.       The sidewalks,  plazas, halls, passages,  exits, entrances,  elevators,
         stairways  and lobbies of the Building and the other Common Areas shall
         not be  obstructed  by Tenant or used by it for any purpose  other than
         for ingress to and egress from the Premises. Landlord retains the right
         to control and prevent  access to the Common Areas of all persons whose
         presence in the judgement of the Landlord  would be  prejudicial to the
         safety,  character,  reputation  and  interests  of the Project and its
         tenants,  or who it believes  are  engaged in illegal or  objectionable
         activities.

2.       Except for signage authorized in the Lease, no sign, placard,  picture,
         name, advertisement or notice visible from the exterior of the Building
         or Premises shall be inscribed, painted, affixed or otherwise displayed
         by  Tenant  on any  part of the  Building  or in any area  outside  the
         Premises and any such sign, placard,  picture,  name,  advertisement or
         notice may be removed by Landlord  without notice to and at the expense
         of Tenant.  No sign will be  permitted on any door visible from outside
         the Premises without Landlord's written approval. All approved signs or
         lettering on doors shall be printed,  painted,  affixed or inscribed at
         the expense of Tenant by a person approved by Landlord,  which approval
         will not be  unreasonably  withheld.  Tenant  shall not place  anything
         within the  Premises  which is visible from outside the Building of the
         Premises, with the exception of ordinary office furnishings, plants and
         equipment.

3.       With the exception of typical catering and food warming activities,  no
         cooking  shall be done or permitted by Tenant on the  Premises,  except
         that  use  by  Tenant  of  Underwriters'  Laboratory-approved  portable
         equipment for brewing coffee,  tea, hot chocolate and similar beverages
         shall be permitted,  as shall the use of  similarly-approved  microwave
         ovens for personal use by Tenant's employees, provided that such use is
         in  accordance  with all  applicable  federal,  state,  and local laws,
         codes,  ordinances,  rules  and  regulations.  Tenant's  employees  may
         prepare food items solely for their own  personal  consumption  and for
         guests,  and shall not  prepare or sell,  or permit to be  prepared  or
         sold,  any  consumable  items  whatsoever  in  the  Premises  or in the
         Building.  In the event pest control is required within the Premises as
         a result of food  preparation  or other  activities  by Tenant,  Tenant
         shall contract and pay for such services.

4.       No person or persons  other than those  approved by  Landlord  shall be
         permitted  to enter the  Building  for the  purpose of  cleaning  same.
         Tenant  shall  not cause any  unnecessary  labor by reason of  Tenant's
         carelessness  or  indifference  in the  preservation  of good order and
         cleanliness.

5.       Landlord will initially furnish to Tenant, free of charge, two keys per
         lockset to the Premises,  and Landlord may make a reasonable charge for
         additional  keys. No additional  locking  devices shall be installed in
         the  Premises  by Tenant,  nor shall any  locking  device be changed or
         altered in any respect  without the prior written  consent of Landlord.
         Landlord may make reasonable charge for any additional lock or any bolt
         (including  labor)  installed  on any door of the  Premises.  All locks
         installed in the Premises  shall be  identified  in writing to Landlord
         and  shall  be  keyed  to the  Building  master  key  system,  with the
         exception of locks  leading to vaults,  safes or other secured areas as
         previously identified in writing to Landlord.  The installation of such
         vaults,  safes or other  secured  areas by Tenant  will be  subject  to
         Landlord's  prior  written  approval,  which shall not be  unreasonably
         withheld. Tenant, upon the termination of its tenancy, shall deliver to
         Landlord  all keys to doors in the  Premises  and all access  cards and
         I.D. cards, if any, to the Building.

6.       Landlord  and Tenant  shall  mutually  agree to a  reasonable  time for
         Tenant's initial move to the Premises.  Tenant shall reimburse Landlord
         upon demand for any  additional  security or other charges  incurred by
         Landlord as a consequence of a major move.  Any third parties  employed
         by Tenant to move  equipment  or other items in or out of the  Building
         must be approved in advance by Landlord.  The floors, corners and walls
         of  corridors  used for the moving of  equipment or other items into or
         out of the Building must be adequately  covered,  padded and protected,
         and  Landlord

                                    EXHIBIT E
                                    Page E-1

<PAGE>

         may elect to provide such padding and protection,  at Tenant's expense,
         if  Landlord  determines  that such  measures  undertaken  by Tenant or
         Tenant's  movers  are  inadequate.  Landlord  shall  have the  right to
         prescribe  the maximum  weight,  size and  position  of all  equipment,
         materials,  supplies,  furniture  or  other  property  bought  into the
         Building,  but this  right  shall  apply  only if the  weight,  size or
         position  of same  could  reasonably  be  expected  to exceed  the load
         capacity  of  the  floors  and  structure  of  the  Building,  or if in
         Landlord's  reasonable  estimation the position of such items creates a
         hazard or  interferes  with  operation of the building  systems.  Heavy
         objects  shall,  if  considered  necessary by Landlord,  be placed on a
         platform of such  thickness as is necessary to properly  distribute the
         weight of such objects.  Landlord shall not be responsible  for loss of
         or damage to the Building resulting from moving or maintaining Tenant's
         property and shall be repaired at the expense of Tenant.

7.       Tenant agrees to cooperate in any delivery  scheduling programs for the
         Common  Areas,  including  restriction  of  deliveries  or  pickups  to
         reasonable periods as may be determined by Landlord.  In its use of the
         loading and unloading areas of the Building,  Tenant shall not obstruct
         or permit the  obstruction  of the Common  Areas,  and at no time shall
         Tenant store  materials,  furniture,  or  equipment,  or park  vehicles
         therein.

8.       Tenant shall not permit the use, storage or disposal in the Premises or
         the Building of any kerosene, gasoline or toxic, hazardous,  flammable,
         combustible  or noxious  gas,  fluid or  materials,  except  reasonable
         quantities of normal office  supplies  used,  stored and disposed of in
         accordance  with   manufacturers'   specifications,   nor  use  without
         Landlord's  prior  written  approval  any  method  of  heating  or  air
         conditioning  other than that  supplied by  Landlord.  Tenant shall not
         permit  or  suffer  the  Premises  to be  occupied  or used in a manner
         offensive  or  objectionable  to  Landlord  or other  occupants  of the
         Building by reason of noise, odors, and/or vibrations, nor interfere in
         any way with other tenants or persons having  business in the Building.
         Tenant  shall not bring or permit to be brought  into the  Building any
         firearm.  Tenant shall be solely  responsible  for repairing any damage
         and  liable  for any  injury  to any  person  caused  as a result  of a
         violation of this provision by Tenant.

9.       Landlord  reserves  the right to exclude from the Building at all times
         other than the usual business hours of the Building,  as established by
         Landlord, all persons who do not have proper evidence of Tenant's prior
         authorization to enter the Premises after hours. Landlord may establish
         at its discretion  what shall  constitute  proper  evidence,  which may
         include I.D.  cards,  special passes or other forms or methods.  Tenant
         shall be  responsible  to Landlord for all persons for whom it requests
         such  access,  and shall be liable to Landlord  for any and all acts of
         such persons.  Landlord  shall in no case be liable for damages for any
         error with regard to the admission to or exclusion from the Building of
         any person.  In the case of invasion,  mob, riot,  public excitement or
         other circumstances  rendering such action advisable in Landlord's sole
         opinion,  Landlord reserves the right to prevent access to the Building
         during the  continuance  of same by such  action as  Landlord  may deem
         appropriate, including closing and securing any doors in the Building.

10.      No curtains,  draperies,  blinds,  shutters,  shades,  screens or other
         coverings,  hangings or decorations shall be attracted to or placed in,
         or used in  connection  with,  any window of the  Building  without the
         prior  written  consent of the  Landlord,  other than  standard  window
         coverings.

11.      Tenant  shall use  reasonable  procedures  to see that the doors of the
         Premises  are  closed  and  locked  and that all water  faucets,  water
         apparatus,  light  switches,  cooking  facilities and office  equipment
         (excluding office equipment  required to be operative at all times) are
         shut off before Tenant or Tenant's employees leave the Premises,  so as
         to prevent  waste or damage.  Tenant shall at all times comply with any
         rules or orders of the fire department or any other  government  agency
         with respect to ingress and egress.

12.      The toilets,  urinals,  wash bowls and other restroom  facilities shall
         not be used  for any  purpose  other  than  that  for  which  they  are
         constructed,  no  foreign  substance  of any kind  whatsoever  shall be
         placed therein, and the expense of repairing any breakage,  stoppage or
         damage  resulting from the violation of this rule shall be borne by the
         tenant whose employees or invitees shall have caused it.

                                    EXHIBIT E
                                    Page E-2

<PAGE>

13.      Tenant shall not install any radio or television antenna,  loudspeaker,
         or other  device on or about the Common  Areas or the roof or  exterior
         walls of the Building.  No  television,  radio or other audio or visual
         apparatus  shall be used in the Premises in such a manner as to cause a
         nuisance  to  any  other  Project  tenant  or  to  interfere  with  any
         frequencies used in connection with Building operations.

14.      Tenant shall at all times maintain the Premises in a neat, professional
         and first-class  manner,  and shall show the same standard of care with
         regard  to the  Common  Areas.  Tenant  shall  store  all its trash and
         garbage  within the Premises  until removal of same to such location in
         the Common  Areas as may be  designated  from time to time by Landlord,
         and at no time  shall  Tenant  store any trash or garbage in any of the
         hallways,  stairways,  elevator or  stairway  lobbies,  loading  areas,
         entrances  or exits for the  Building.  No fluid or  material  shall be
         placed with  Tenant's  trash and  garbage or be placed in the  Building
         trash boxes or  receptacles if such fluid or material is of such nature
         that it may not be disposed of in the ordinary and customary  manner of
         removing  and  disposing  of trash and  garbage in the City of Petaluma
         without  being in  violation  of any law or  ordinance  governing  such
         disposal.  Tenant shall pay  reasonable  extra charges as determined by
         Landlord for any unusual trash disposal.

15.      Canvassing,  soliciting,  peddling,  or distribution by Tenant to other
         Project tenants or visitors of handbills or any other written  material
         in the  Project  is  prohibited,  and  Tenant  shall  not  permit  such
         activities  by its  employees  or invitees.  Tenant shall  cooperate in
         reporting  to  Landlord  any  such  activities  of  solicitors  in  the
         Building.

16.      Tenant shall  immediately,  upon written  request from Landlord  (which
         request  need not be in  writing),  reduce its lighting in the Premises
         for  temporary  periods  designated  by  Landlord,  when  required in a
         temporary  emergency  situation  caused by  earthquake  or other  force
         majeure event to prevent  overloading  of the  mechanical or electrical
         systems of the Building.

17.      Tenant  shall not place any load on the floors of the  Premises  or the
         Building  exceeding  the live load  capacity  thereof as  determined by
         Landlord.  Tenant shall not use electricity  for lighting,  machines or
         equipment  in  excess  of  the  consumption  load  of the  Premises  as
         determined  by Landlord.  Except as permitted  in  accordance  with the
         Lease,  Tenant shall not alter any of the Building  systems,  including
         but not limited to heating,  air conditioning,  and other mechanical or
         electrical systems, without the prior written consent of Landlord.

18.      Landlord  reserves  the right to exclude or expel from the  Project any
         person who is, in the judgement of Landlord,  intoxicated  or under the
         influence  of  alcohol  or  other  drug,  or  acting  in a  violent  or
         disruptive  manner,  or who shall in any manner do any act in violation
         of any of the Rules and Regulations of the Building.

19.      No animals of any kind shall be  permitted  at any time in the Premises
         or  the  Building,   with  the  exception  of  guide  animals  for  the
         handicapped employees or invitees of Tenant.

20.      Any charges  which  Tenant is  obligated by these Rules to pay shall be
         deemed  additional rent under the Lease,  and should Tenant fail to pay
         the same within ten (10) days after written demand,  such failure shall
         be treated as a default by Tenant to pay rent as due under the Lease.

21.      Landlord may waive any one or more of these Rules and  Regulations  for
         the benefit of any particular tenant or tenants,  but no such waiver by
         Landlord shall be construed as a waiver of these Rules and  Regulations
         in favor of any other  tenant or  tenants,  nor prevent  Landlord  from
         thereafter  enforcing any such Rules and Regulations against any or all
         of the tenants of the  Building.  All waivers shall be one time waivers
         only unless in writing and specifically providing to the contrary.

22.      These  Rules  and  Regulations  are in  addition  to,  and shall not be
         construed in any way to modify,  alter or amend,  in whole or part, the
         terms,  covenants,  agreements  and conditions of Tenant's Lease or any
         other lease of premises in the  Project.  In the event of any  conflict
         between the terms

                                    EXHIBIT E
                                    Page E-3

<PAGE>

         of these  Rules  and  Regulations  and the  terms  of any  lease in the
         Building, the terms of the lease shall prevail.

23.      Landlord  reserves  the right to make such other  reasonable  rules and
         regulations,  or to amend or repeal these Rules and Regulations,  as in
         its judgement may from time to time be needed for the safety,  care and
         cleanliness  of the  Project  and for the  preservation  of good  order
         therein.

24.      Tenant shall be responsible  for the observance of all of the foregoing
         rules and  regulations  by  Tenant's  employees,  agents,  contractors,
         clients,  customers,  invitees and guests.  Tenant shall cooperate with
         Landlord's  educational programs for Landlord's policies and procedures
         with  regard  to fire  and  life  safety,  earthquakes  and  any  other
         emergency  or  evacuation  procedures  of which  Landlord  shall notify
         Tenant from time to time.

25.      Tenant shall at all times require  communication,  telephone,  computer
         and all other similar types of vendors  installing  cables,  lines, and
         the like in the ceiling plenum, to support their work  independently of
         the ducts and ceiling grids.

                                    EXHIBIT E
                                    Page E-4

<PAGE>

                                    EXHIBIT F

                           LIST OF HAZARDOUS MATERIALS

o        6 Volt Wet Cell Batteries
o        Non-detergent Motor Oil
o        Pneumatic Oil
o        Lithium Grease
o        Betco dust mop treatment
o        Spartan DMQ Disinfectant
o        Grants Ant Stakes
o        3M Spray Mount Adhesive
o        Gillette Company Liquid Paper
o        Copier and Printer Toner
o        Copier Fusing Oil
o        Copier Fusing Agent
o        Pitney Bowes Meter Ink
o        Printers Ink
o        Ink Thinner

                                    EXHIBIT F
                                    Page F-1

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