Document:

<PAGE>

                                                                   EXHIBIT 10.32

March 2, 2001

Arthur Taylor
1005 Deanna Drive
Menlo Park, CA  94025

Dear Art:

While the interview process is still under way, I anticipate that we will be
able to complete this process no later than Monday, March 5, 2001.  In order to
expedite this process, I am pleased to extend an offer of employment to you for
the position of Chief Financial Officer reporting directly to me under the terms
described below.  You will work out of our Mountain View, CA office.  Of course,
Docent may change your position, duties and work location from time to time, as
it deems necessary.  This offer is valid until the close of business, Wednesday,
March 7, 2001.

This offer is contingent upon the successful completion of your references and
the completion and positive outcome of an interview with one or more outside
members of the Docent Board of Directors.

Your anticipated start date will be no later than March 26,2001.

Your annual target compensation at 100% achievement will be $375,000.  Your
target compensation will be comprised of an annual base salary of $275,000 and
an annual variable compensation of $100,000 at 100% achievement.  You will be
paid semi-monthly.

If your employment is terminated by the company for any reason other than for
cause during your first year of employment, you will receive a severance payment
equal to 50% of your annual base salary at the time of your termination.

In addition to the above compensation, you will receive a $25,000 signatory
bonus payable in your first payroll as a full-time regular Docent employee.
This signatory bonus will be recoverable on a prorated monthly basis if you
decide to voluntarily end your employment with Docent before your first
anniversary.

In addition to the above compensation, you will be eligible to participate in
Docent's standard benefit plans, which currently include medical, dental,
vision, long-term disability and term life insurance; 401(k) plan; flexible
spending plan, vacation of three weeks per year up to a maximum accrual of four
weeks; sick leave and holidays.  Details about these benefit plans are available
for your review.  Docent may modify compensation and benefits from time to time
as it deems necessary.

Subject to approval by the Board of Directors, you will be granted an incentive
stock option for the purchase of up to 275,000 shares of Docent common stock
with an exercise price equal to the fair market value of Docent common stock on
the date of grant as determined by the Board of Directors.  This option will be
granted pursuant to the Docent 2000 Omnibus Equity Plan and will be subject to
vesting over four years as follows: 1/4 vests after 12 months of service, 1/48
vests each month of service thereafter.

<PAGE>

As a condition of your employment, you agree to sign Docent's Proprietary
Information and Inventions Agreement which prohibits unauthorized use or
disclosure of Docent proprietary information.  This letter, together with your
Proprietary Information and Inventions Agreement, forms the complete and
exclusive statement of your employment agreement with Docent.  The employment
terms in this letter supersede any other agreements or promises made to you by
anyone, whether oral or written.  Further, by signing below and indicating your
acceptance of this offer, you represent that you may legally work in the United
State of America and agree to provide the necessary supporting documentation. As
a Docent employee, you will be expected to abide by Docent rules and regulations
as outlined in the Docent Employee Handbook.

This letter confirms your representations to us that: (i) you are not a party to
any employment agreement or other contract or arrangement that prohibits your
full-time employment with Docent, (ii) you will not disclose any trade secrets
or confidential information of any third party to Docent, and (iii) you do not
know of any conflict that would restrict your employment with Docent.

Your employment with Docent is entered into voluntarily.  As a result, you may
terminate your employment with Docent at any time and for any reason simply by
notifying Docent.  Likewise, Docent may terminate your employment at any time
and for any reason, with or without cause or advanced notice.  This at-will
employment relationship cannot be changed except in writing signed by an officer
of Docent.

Art, I look forward to having you join the Docent team.  If you wish to accept
this employment offer under the terms described above, please sign, date and
confirm your start date below and return a copy to me by Wednesday, March 7,
2001.

I look forward to your favorable reply and to a long and prosperous work
relationship.

                                     Sincerely,

                                     Dave Ellett
                                     Chairman and CEO

Accepted:  _____________________________    Date:  _______________
                  Art Taylor

Start Date:  _________________<PAGE>

                                                                   EXHIBIT 10.33

                                    SUBLEASE
                                    --------

     THIS SUBLEASE (this "Sublease") is dated for reference purposes as of April
__, 2001 and is made by and between Loudcloud, Inc., a Delaware corporation
("Sublandlord"), and Docent, Inc., a Delaware corporation ("Subtenant").
Sublandlord and Subtenant hereby agree as follows:

     1.  Recitals:  This Sublease is made with reference to the fact that Maude
         --------
Avenue Land Corporation, as "Landlord," ("Master Landlord") and Sublandlord, as
"Tenant," are parties to that certain Lease dated October 17, 2000 (the "Master
Lease"), with respect to those certain premises consisting of approximately
122,000 rentable square feet described therein (the "Master Premises") located
at 1030 Maude Avenue, Sunnyvale, California.  A copy of the Master Lease is
attached hereto as Exhibit A.  Capitalized terms used and not defined herein
                   ---------
shall have the meaning ascribed to them in the Master Lease.

    2.  Subleased Premises:
        ------------------

          A.  Subject to the terms and conditions of this Sublease, Sublandlord
hereby subleases to Subtenant, and Subtenant hereby subleases from Sublandlord,
a portion of the Master Premises consisting of approximately 36,314 rentable
square feet as more particularly shown on Exhibit B attached hereto (the
                                          ---------
"Subleased Premises").  The square footage of the Subleased Premises set forth
herein is conclusively deemed to be the actual square footage thereof as of the
date hereof.

          B.  Subtenant shall have non-exclusive access, with Sublandlord and
other subtenants of the Master Premises, to the common areas (including, without
limitation, the main lobby and common area hallways) as shown on Exhibit B
                                                                 ---------
attached hereto subject, however, to Sublandlord's reasonable rules and
regulations that Sublandlord may establish from time to time with respect to
such access; provided, however, that any rules or regulations established by
Sublandlord shall not materially diminish Subtenant's rights hereunder nor
impose additional material obligations on Subtenant.

          C.  Subtenant shall be entitled to use, in common with Sublandlord and
all subtenants in the Master Premises, the main lobby area subject, however, to
Sublandlord's reasonable rules and regulations that Sublandlord may establish
from time to time with respect to such use; Notwithstanding the foregoing, any
rules or regulations established by Sublandlord shall not materially diminish
Subtenant's rights hereunder nor impose additional material obligations on
Subtenant.

          D.  Subtenant shall be entitled to non-exclusive access, with
Sublandlord and other subtenants of the Master Premises, to the
shipping/receiving dock in the Master Premises for the limited purpose of
shipping and receiving items in the ordinary course of Subtenant's business
subject, however, to Sublandlord's reasonable rules and regulations that
Sublandlord may establish from time to time with respect to such access;
Notwithstanding the foregoing, any rules or regulations established by
Sublandlord shall not materially diminish Subtenant's rights hereunder nor
impose additional material obligations on Subtenant.

     3.  Term:
         ----

          A.  Term.  The term (the "Term") of this Sublease shall be for the
              ----
period commencing on the date by which the Subleased Premises are delivered by
Sublandlord to Subtenant with the Sublandlord Improvements Completed (the
"Commencement Date") and ending June 3, 2003, unless this Sublease is
<PAGE>

sooner terminated pursuant to its terms or the Master Lease is sooner terminated
pursuant to its terms (the "Expiration Date"). In the event Master Landlord
exercises its right to terminate the Master Lease pursuant to Section 1.C of the
Master Lease, the Expiration Date hereunder shall be seven (7) days prior to the
date of termination set forth in the "Notice of Termination" (as defined in the
Master Lease) given by Landlord. The term "Completed" shall mean the lien free
completion (except, however, for minor punchlist items) of the Sublandlord
Improvements in substantial accordance with Exhibit C hereto with all required
governmental department, agency or authority permits and approvals in connection
therewith obtained. To the extent any material variation to the plans and
specifications set forth on Exhibit C hereto are necessitated to obtain the
approval, permits or certificates from the Master Landlord or any governmental
department, agency or authority having competent jurisdiction, then such
variation shall be subject to the reasonable approval of Subtenant.

          B.  No Options to Extend or Expand. Notwithstanding anything to the
              ------------------------------
contrary in the Master Lease, Subtenant shall not have any options to extend or
renew the term of the Sublease or, except as set forth in Paragraph 3.C below,
any options to expand the Subleased Premises.

          C.  Right of First Offer.  If Sublandlord determines to sublease any
              --------------------
part of the Master Premises other than the Subleased Premises (each such space
an "Expansion Space"), then Sublandlord shall notify Subtenant of the terms on
which Sublandlord is willing to lease such Expansion Space. If Subtenant, within
ten (10) business days after receipt of Sublandlord's written notice indicates
in writing its agreement to lease the Expansion Space on the terms stated in
Sublandlord's notice, then Sublandlord shall sublease to Subtenant and Subtenant
shall sublease from Sublandlord the Expansion Space on the terms stated in
Sublandlord's notice. If Subtenant does not indicate in writing its agreement to
lease such Expansion Space on the terms contained in Sublandlord's notice within
said ten (10) business day period, then Sublandlord thereafter shall have the
right to sublease such Expansion Space to a third party on substantially similar
terms stated in Sublandlord's notice, which economic terms are substantially the
same as those offered to Subtenant. If Sublandlord does not lease such Expansion
Space within one hundred twenty (120) days after the expiration of said ten (10)
business day period, or if Sublandlord desires to sublease such Expansion Space
on economic terms which are not substantially the same as those offered to
Subtenant, any further transaction shall be deemed a new determination by
Landlord to lease the Expansion Space and the provisions of this paragraph shall
again be applicable.

     4.  Rent:
         ----

          A.  Base Rent.  Commencing on the Commencement Date and continuing
              ---------
each month throughout the Term of this Sublease, Subtenant shall pay to
Sublandlord as base rent ("Base Rent") for the Subleased Premises monthly
installments as follows:

        ---------------------------------------------------------------
                 Months                        Base Rent per Month
        ---------------------------------------------------------------
        Commencement Date - March 30, 2002         $154,334.50
        ---------------------------------------------------------------
         April 1, 2002 - Expiration Date           $160,507.88
        ---------------------------------------------------------------

Base Rent and Additional Rent, as defined in Paragraph 4.B below, (collectively,
hereinafter "Rent") shall be paid in advance on or before the first (1st) day of
each month, with Additional Rent payable at such times as set forth in Section
4(B) hereof.  Rent for any period during the Term hereof which is for less than
one (1)

                                      -2-
<PAGE>

month of the Term shall be a pro rata portion of the monthly installment based
on a thirty (30) day month. Rent shall be payable without notice or demand and
without any deduction, offset, or abatement (except as otherwise set forth in
the Sublease), in lawful money of the United States of America. Rent shall be
paid directly to Sublandlord at 599 N. Mathilda Avenue, Sunnyvale, CA 94086,
Attention: Director of Real Estate, or such other address as may be designated
in writing by Sublandlord.

          B. Additional Rent. All monies other than Base Rent required to be
             ---------------
paid by Subtenant under this Sublease shall be deemed additional rent
("Additional Rent"). Additional Rent shall include, without limitation, all
amounts payable by Sublandlord under the Master Lease with respect to or
reasonably allocated to the Subleased Premises accruing during the Term of the
Sublease (except for "Base Rent" under the Master Lease and services requested
by Sublandlord or other subtenant for Sublandlord's or such other subtenant's
sole benefit), except that Subtenant shall not be required to pay such amount to
the extent that such expenses are incurred as a result of Sublandlord's or its
agent's, employee's or contractor's negligence, willful misconduct or breach of
the Master Lease not caused by Subtenant. Subtenant acknowledges that
Sublandlord is required to pay to Master Landlord "Operating Costs" and "Taxes"
and estimated payments thereof and adjustments thereto under Section 2 of the
Master Lease. In addition to all other Additional Rent set forth in this
Sublease, Subtenant shall pay to Sublandlord as Additional Rent hereunder,
Subtenant's pro rata share of all of such "Operating Expenses" and estimated
payments thereof and adjustments thereto payable by Sublandlord to Master
Landlord. Subtenant's pro rata share shall mean that amount, expressed as a
percentage, equal to the number of square feet included in the Subleased
Premises divided by the number of square feet in the Master Premises. Such
amounts (including estimated payments thereof and adjustments thereto) shall be
payable by Subtenant no later than the dates the same are due under the Master
Lease; provided that Sublandlord has given Subtenant reasonably adequate notice
and evidence of the same. Notwithstanding the foregoing, with respect to
estimates of Operating Expenses and Taxes under the Master Lease, within 10 days
after receiving an original or revised estimate of the Operating Expenses and
Taxes reasonably allocable to the Subleased Premises, Subtenant shall pay
Sublandlord 1/12th of such estimate, multiplied by the number of months (if any)
that have elapsed in the applicable fiscal year to the date of such payment
including the current month, minus payments previously made by Subtenant for the
months elapsed. On the first day of each month thereafter, Subtenant shall pay
Sublandlord 1/12th of such estimate, until a new estimate becomes applicable.
Sublandlord shall promptly forward the appropriate invoices received from Master
Landlord. Notwithstanding the foregoing, but except for all costs, expenses,
fees and charges incurred in connection with the construction of the Sublandlord
Improvements, in the event any cost or expense is incurred by Sublandlord under
the Master Lease for Subtenant's sole benefit or as a result of Subtenant's
request for certain services (such as extra hours' charges, etc.) or as a result
of Subtenant's or its agent's, employee's or contractor's negligence, willful
misconduct or breach of the Sublease or Master Lease, Subtenant shall pay the
entire cost thereof, and such charges shall not be pro rated between Sublandlord
and Subtenant.

          Except to the extent included in Operating Expenses under the Master
Lease, Subtenant shall pay for all water, gas, heat, light, power, telephone,
WAN and other telecommunications lines and services, sewer service, waste pick-
up and any other utilities and services (including HVAC) to the Subleased
Premises.  If any such utilities or services are not separately metered to the
Subleased Premises, Subtenant shall pay within thirty (30) days of demand
Subtenant's pro rata share of the cost of such utilities and services incurred
by Sublandlord for the Master Premises.  In the event Sublandlord reasonably
determines that Subtenant is using a disproportionate amount of such utilities
and services, Sublandlord may either (1) charge a reasonable proportion to be
reasonably determined by Sublandlord of all charges jointly metered to the
Master Premises or (2) separately meter the Subleased Premises at Subtenant's
sole cost and expense.

                                      -3-
<PAGE>

     Subtenant and its authorized representatives may examine, inspect and audit
for accuracy Sublandlord's calculations of Additional Rent payable by Subtenant
under this Sublease as compared to bills and invoices Sublandlord has received
from Master Landlord and other third party providers and copy the same. Such
examination, inspection, audit or copying may be done within one year of
Subtenant's receipt of such invoice at reasonable times and upon reasonable
prior written notice. Unless Subtenant serves such notice within one year of
receipt of such invoice, the invoice shall be deemed final. Upon a reasonable
determination that Subtenant was overcharged for Additional Rent or any other
charges which were due hereunder, Sublandlord shall, within 15 business days of
such determination and notice from Subtenant, remit all overcharged amounts to
Subtenant. This examination privilege does not include any examination by
subtenant of Master Landlord's books or records.

          C.  Prepayment of Rent.  Upon execution hereof by Subtenant, Subtenant
              ------------------
shall pay to Sublandlord the sum of One Hundred Thirty-Seven Thousand Sixty-Two
Dollars and 50/100 ($137,062.50), which shall constitute Base Rent for the first
(1st) month of the Term. Upon any termination of the Sublease prior to the
Commencement Date for any reason other than a default by Subtenant, Sublandlord
shall return to Subtenant all prepaid rent and the Security Deposit.

     5.  Security Deposit:
         ----------------

          A.  Upon execution of this Sublease, Subtenant shall deposit with
Sublandlord Four Hundred Eleven Thousand One Hundred Eighty-Seven Dollars and
50/100 ($411,187.50) in cash as security for the performance by Subtenant of its
obligations under this Sublease, and not as a prepayment of rent (the "Security
Deposit").  If Subtenant defaults under this Sublease, Sublandlord may apply all
or any part of the Security Deposit for the payment of any rent or other sum in
default, the repair of any damage to the Subleased Premises caused by Subtenant
or the payment of any other amount which Sublandlord may spend or become
obligated to spend by reason of Subtenant's default or to compensate Sublandlord
for any other loss or damage which Sublandlord may suffer by reason of
Subtenant's default to the full extent permitted by law.  Subtenant hereby
waives any restriction on the use or application of the Security Deposit by
Sublandlord as set forth in California Civil Code Section 1950.7.  To the extent
any portion of the Security Deposit is used, Subtenant shall within five (5)
days after demand from Sublandlord restore the Security Deposit to its full
amount.  Sublandlord may keep the Security Deposit in its general funds and
shall not be required to pay interest to Subtenant on the deposit amount.  If
Subtenant shall perform all of its obligations under this Sublease and return
the Subleased Premises to Sublandlord at the end of the Term, Sublandlord shall
return all of the remaining Security Deposit to Subtenant within thirty (30)
days after the end of the Term.  The Security Deposit shall not serve as an
advance payment of rent or a measure of Sublandlord's damages for any default
under this Sublease.  Subtenant covenants and agrees that it shall not assign or
encumber or attempt to assign or encumber the Security Deposit and neither
Sublandlord nor its successors or assigns shall be bound by any such agreement,
encumbrance, attempted assignment or attempted encumbrance.

          B.  In lieu of a cash security deposit, the Security Deposit to be
delivered by Subtenant to Sublandlord may be in the form of an irrevocable and
unconditional letter of credit (the "Letter of Credit") governed by the Uniform
Customs and Practice for Documentary Credits (1993 revisions), International
Chamber of Commerce Publication No. 500, as revised from time to time, in an
amount equal to Four Hundred Eleven Thousand One Hundred Eighty-Seven Dollars
and 50/100 ($411,187.50), issued to Sublandlord, as beneficiary, in form and
substance reasonably satisfactory to Sublandlord, by a bank reasonably approved
by Sublandlord and qualified to transact banking business in California with an
office in the City of Mountain View, California at which drafts drawn on the
Letter of Credit may be presented for payment.  The full amount of the Letter of
Credit shall be available to Sublandlord upon presentation of

                                      -4-
<PAGE>

Sublandlord's sight draft accompanied only by the Letter of Credit and
Sublandlord's signed statement that Sublandlord is entitled to draw on the
Letter of Credit pursuant to this Sublease. Subtenant shall maintain the Letter
of Credit for the entire Term and any extension thereof. The Letter of Credit
shall expressly state that the Letter of Credit and the right to draw thereunder
may be transferred or assigned by Sublandlord to any successor or assignee of
Sublandlord under this Sublease. Subtenant shall pay any fees related to the
issuance or amendment of the Letter of Credit, including, without limitation,
any transfer fees. The Letter of Credit shall permit partial draws. The Letter
of Credit shall provide that it will be automatically renewed until thirty (30)
days after the Expiration Date unless the issuer provides Sublandlord with
written notice of non-renewal at the notice address herein at least sixty (60)
days prior to the expiration thereof. If, not later than thirty (30) days prior
to the expiration of the Letter of Credit, Subtenant fails to furnish
Sublandlord with a replacement Letter of Credit pursuant to the terms and
conditions of this section, then Sublandlord shall have the right to draw the
full amount of the Letter of Credit, by sight draft, and shall hold the proceeds
of the Letter of Credit as a cash Security Deposit pursuant to the terms and
conditions of Section 5.A above.

     6.  Late Charge:  If Subtenant fails to pay Sublandlord any amount due
         -----------
hereunder on or before the third day after such payment is due, Subtenant shall
pay to Sublandlord upon demand a late charge equal to five percent (5%) (the
"Late Charge") of the delinquent amount. The parties agree that the foregoing
late charge represents a reasonable estimate of the cost and expense which
Sublandlord will incur in processing each delinquent payment. Sublandlord's
acceptance of any interest or late charge shall not waive Subtenant's default in
failing to pay the delinquent amount.

    7.  Holdover:  Subtenant acknowledges that it is critical that Subtenant
        --------
surrender the Subleased Premises on or before the expiration or earlier
termination of the Sublease in accordance with the terms of this Sublease.
Accordingly, Subtenant shall indemnify, defend and hold harmless Sublandlord
from and against all losses, costs, claims, liabilities and damages resulting
from Subtenant's failure to surrender the Subleased Premises on or before the
expiration or earlier termination of the Sublease in the condition required
under the terms of this Sublease (including, without limitation, any liability
or damages sustained by Sublandlord as a result of a holdover of the Master
Premises by Sublandlord occasioned by the holdover of the Subleased Premises by
Subtenant).  In addition, Subtenant shall pay Sublandlord holdover rent equal to
one hundred fifty percent (150%) of Base Rent plus any Additional Rent payable
hereunder for any period from the Expiration Date through the date Subtenant
surrenders the Subleased Premises in the condition required hereunder.

     8.  "AS IS" Condition; Master Landlord's Obligations:
          -----------------------------------------------

             A.  The parties acknowledge and agree that, except as otherwise
provided herein, Subtenant is subleasing the Subleased Premises on an "AS IS"
basis, and that, except as otherwise provided herein, Sublandlord has made no
representations or warranties, express or implied, whatsoever, with respect to
the Subleased Premises, including, without limitation, any representation or
warranty as to the suitability of the Subleased Premises for Subtenant's
intended use or any representation or warranty made by Master Landlord under the
Master Lease. Except for the Sublandlord Improvements, Sublandlord shall have no
obligation whatsoever to make or pay the cost of any alterations, improvements
or repairs to the Subleased Premises, including, without limitation, any
improvement or repair required to comply with any law, regulation, building code
or ordinance (including the Americans with Disabilities Act of 1990, as may be
amended). In addition, Sublandlord shall have no obligation to perform any
repairs or any other obligation of Master Landlord required to be performed by
Master Landlord under the terms of the Master Lease (including, without
limitation, Master Landlord's obligations under Sections 2, 3, 4, 6, 9, 10, 11,
12 and 18 of the Master Lease and Master Landlord's obligation to comply with
laws and carry building insurance).

                                      -5-
<PAGE>

            B.  If Master Landlord shall fail to perform its obligations with
respect to the Subleased Premises in accordance with the terms of the Master
Lease (including, without limitation, Master Landlord's obligations with respect
to its representation and warranty under Paragraph 3.A of the Master Lease),
Sublandlord, upon receipt of written notice from Subtenant, shall use diligent
good faith efforts to attempt to enforce all such obligations of Master Landlord
under the Master Lease (without requiring Sublandlord to spend more than a
nominal sum in excess of the amount Subtenant has agreed in writing to promptly
reimburse, which nominal sum shall be limited to all costs associated with the
preparation of and transmittal to Master Landlord of documentation from
Sublandlord or Sublandlord's attorneys detailing the obligations to be performed
by Master Landlord under the Master Lease). If, after receipt of written request
from Subtenant, Sublandlord shall fail or refuse to take action for the
enforcement of Sublandlord's rights against Master Landlord with respect to the
Subleased Premises ("Action"), Subtenant shall have the right to take such
Action in its own name, and for that purpose and only to such extent, all of the
rights of Sublandlord as "Tenant" with respect to the Subleased Premises under
the Master Lease hereby are conferred upon and assigned to Subtenant, and
Subtenant hereby is subrogated to such rights to the extent that the same shall
apply to the Subleased Premises. If any such Action against Master Landlord in
Subtenant's name shall be barred by reason of lack of privity, nonassignability
or otherwise, Subtenant may take such Action in Sublandlord's name; provided
that Subtenant has obtained the prior written consent of Sublandlord, which
consent shall not be unreasonably withheld or delayed, and, provided further,
that except to the extent of the negligence or willful misconduct of
Sublandlord, its agents, employees or contractors or a breach of the Master
Lease not directly caused by Subtenant, Subtenant shall indemnify, protect,
defend by counsel reasonably satisfactory to Sublandlord and hold Sublandlord
harmless from and against any and all liability, loss, claims, demands, suits,
penalties or damage (including, without being limited to, reasonable attorneys'
fees and expenses) which Sublandlord may incur or suffer by reason of such
Action.

            C.  Subtenant hereby expressly waives the provisions of subsection 1
of Section 1932 and Sections 1941 and 1942 of the Civil Code of California and
all rights to make repairs at the expense of Sublandlord as provided in Section
1942 of said Civil Code.

            D.  Notwithstanding the foregoing, Sublandlord hereby represents and
warrants, for the benefit of Subtenant, that (a) to its current actual
knowledge, the Subleased Premises, including any portion thereof which consists
of the shell building operating systems (including, without limitation, the
plumbing, the roof, the electrical systems, and the structure) are in good
condition and repair, and (b) Sublandlord has not received any notice from any
person or entity, including, without limitation, any governmental agency,
department or authority, that the Subleased Premises, or the use thereof,
violates any applicable laws, ordinances, regulations, orders or findings
("Applicable Laws").

     9.  Right to Cure Defaults:
         ----------------------

            A.  If Subtenant fails to pay any sum of money to Sublandlord, or
fails to perform any other act on its part to be performed hereunder, then
Sublandlord may, but shall not be obligated to, make such payment or perform
such act. All such sums paid, and all reasonable costs and expenses of
performing any such act, shall be deemed Additional Rent payable by Subtenant to
Sublandlord upon demand, together with interest thereon at the lesser of (i) ten
percent (10%) per annum or (ii) the maximum rate allowable under law (the
"Default Rate") from the date of the expenditure until repaid.

            B.  If Sublandlord fails to pay any sum of money to Master Landlord
with respect to the Subleased Premises, or fails to perform any other act on its
part to be performed with respect to the Subleased Premises, then Subtenant may,
but shall not be obligated to, make such payment or perform such act. All such
sums paid, and all reasonable costs and expenses of performing any such act,
shall be payable

                                      -6-
<PAGE>

by Sublandlord to Subtenant upon demand, together with interest thereon at the
lesser of (i) ten percent (10%) per annum or (ii) the maximum rate allowable
under law from the date of the expenditure until repaid.

     10.  Indemnity:  Except to the extent caused by the negligence or willful
          ---------
misconduct of Sublandlord, its agents, employees or contractors, Subtenant shall
indemnify, defend with counsel reasonably acceptable to Sublandlord, protect and
hold harmless Sublandlord and its agents, employees, directors, shareholders,
contractors and representatives from and against any and all losses, claims,
liabilities, judgments, causes of action, damages, costs and expenses
(including, without limitation, reasonable attorneys' and experts' fees), caused
by or arising in connection with: (i) the Subtenant's or its agents',
employees', contractors' or invitees' use, occupancy, operation or condition of
the Subleased Premises; (ii) the Subtenant's or its agents', employees',
contractors' or invitees' use of or access to the common areas and the
shipping/receiving area; (ii) the negligence or willful misconduct of Subtenant
or its agents, employees, contractors or invitees; and (iii) a breach of
Subtenant's obligations under this Sublease or a breach of the provisions of the
Master Lease directly caused by Subtenant.  Subtenant's covenants under this
Paragraph shall survive termination of this Sublease.

     11.  Assignment and Subletting:  Subtenant shall not (i) make or allow any
          -------------------------
assignment or transfer, by operation of law or otherwise, of any part of
Subtenant's interest in this Sublease, (ii) grant or allow any lien or
encumbrance, by operation of law or otherwise, upon any part of Subtenant's
interest in this Sublease, (iii) sublet any part of the Subleased Premises, or
(iv) permit anyone other than Subtenant and its employees to occupy any part of
the Subleased Premises (collectively, "Transfer"), without the prior consent of
Master Landlord in each case pursuant and subject to the terms of Section 17 of
the Master Lease.  A consent to one Transfer shall not be deemed to be a consent
to any subsequent Transfer.  Any Transfer without such consent shall be void
and, at the option of Sublandlord, shall be a material default under this
Sublease.  Sublandlord's waiver or consent to any assignment or subletting shall
be ineffective unless set forth in writing, and Subtenant shall not be relieved
from any of its obligations under this Sublease.  With respect to the excess
rent pursuant to Section 17.E of the Master Lease from any Transfer by
Subtenant, after Master Landlord has received its share of such excess rent
pursuant to Section 17.E of the Master Lease, any remaining excess rent shall be
divided equally between Sublandlord and Subtenant.

     12.  Use:
          ---
             A.  Subtenant may use the Subleased Premises for general office use
and for no other purpose whatsoever.

             B.  Subtenant's obligations (including, without limitation,
indemnity obligations) and with respect to Hazardous Materials (as defined in
the Master Lease) are set forth in Article 18 of the Master Lease incorporated
herein. Sublandlord shall indemnify, defend, protect and hold harmless Subtenant
from any and all loss, claim demand, action, expense, liability and cost
(including reasonable attorneys' fees and expenses) arising out of or in any way
related to the presence of any Hazardous Material introduced to the Subleased
Premises during the period beginning on the December 11, 2000 and ending on the
Commencement Date of this Sublease. Sublandlord's and Subtenant's obligations to
indemnify, defend, protect and hold harmless under this Sublease shall survive
the termination of this Sublease.

             C.  Subtenant shall comply with all rules and regulations
promulgated from time to time by Master Landlord. Subtenant shall also comply
with all reasonable rules and regulations promulgated from time to time by
Sublandlord, provided such Sublandlord rules to do not materially diminish
Subtenant's rights under this Sublease or materially increase Subtenant's
obligations under this Sublease.

                                      -7-
<PAGE>

     13.  Effect of Conveyance:  As used in this Sublease, the term
          --------------------
"Sublandlord" means the holder of the Tenant's interest under the Master Lease.
In the event of any assignment or transfer of the Tenant's interest under the
Master Lease, which assignment or transfer may occur at any time during the Term
hereof in Sublandlord's sole discretion, Sublandlord shall be and hereby is
entirely relieved of all covenants and obligations of Sublandlord hereunder so
long as the transferee has assumed and has agreed to carry out all covenants and
obligations thereafter to be performed by Sublandlord hereunder. Sublandlord
shall transfer and deliver any security of Subtenant to the transferee of the
Tenant's interest under the Master Lease, and thereupon Sublandlord shall be
discharged from any further liability with respect thereto.

     14.  Delivery and Acceptance:  Subject to Paragraph 8 hereof, Sublandlord
          -----------------------
shall deliver the Subleased Premises with the Sublandlord Improvements
substantially completed but otherwise in the Subleased Premises' "AS IS"
condition. This Sublease shall not be void or voidable (subject to Paragraph 16
of this Sublease), nor shall Sublandlord be liable to Subtenant for any loss or
damage, by reason of delays in the Commencement Date or delays in Sublandlord
delivering the Subleased Premises to Subtenant for any reason whatsoever;
provided, however, that Rent shall abate until Sublandlord delivers possession
of the Subleased Premises to Subtenant. Subtenant has fully inspected the
Subleased Premises and is satisfied with the condition thereof.

     15.  Improvements:  Subtenant shall not make any alterations or
          ------------
improvements to the Subleased Premises (i) without the prior written consent of
both Master Landlord and Sublandlord and (ii) except in accordance with the
Master Lease.

     16.  Sublandlord Improvements:  Sublandlord shall cause to be constructed
          ------------------------
the improvements (as more particularly described in those plans and
specifications set forth on Exhibit C hereto) (the "Sublandlord Improvements")
in a good and workmanlike manner and in compliance with all applicable laws,
codes, covenants, regulations, restrictions and orders ("Applicable Laws").
Sublandlord shall diligently prepare and submit to Master Landlord and the City
of Sunnyvale (or any other governmental department, agency or authority having
competent jurisdiction) any necessary plans and specifications necessary to
obtain any required approvals, including without limitation, any necessary
permits or certificates. In the event that notwithstanding Sublandlord's good
faith and diligent efforts, (i) Sublandlord is not successful in obtaining such
required approvals (including without limitation, any necessary permits or
certificates) from Master Landlord on or before May 15, 2001, or (ii)
Sublandlord is not successful in obtaining such required approvals (including,
without limitation, any necessary permits or certificates) from the City of
Sunnyvale (or any other governmental department, agency or authority having
competent jurisdiction) on or before May 15, 2001, then either party may
terminate this Sublease upon written notice to the other prior to the date such
approvals are obtained. In addition, if Master Landlord has not Completed the
Sublandlord Improvements on or before June 15, 2001 then Subtenant shall have
the right to terminate this Sublease by giving Sublandlord written notice of
such election prior to the date the Sublandlord Improvements are Completed. If,
despite Sublandlord's good faith and diligent efforts to cause the Master
Landlord to Complete the Sublandlord Improvements, Master Landlord has not
Completed the Sublandlord Improvements on or before July 15, 2001, then
Sublandlord shall have the right to terminate this Sublease by giving Subtenant
written notice of such election prior to the date the Sublandlord Improvements
are Completed, unless within 3 business days of receipt of such notice Subtenant
notifies Sublandlord in writing that Subtenant is willing to occupy the
Subleased Premises and commence the term hereof, notwithstanding such failure
and provided that Sublandlord shall continue to use its diligent and good faith
efforts to cause Master Landlord to complete such improvements. In the event of
any such termination of this Sublease pursuant to this Paragraph 16, Sublandlord
and Subtenant shall be automatically relieved of any and all duty or obligation
hereunder. In the event the Sublandlord Improvements, as initially constructed
by Master Landlord, do not comply with Applicable Laws existing as of the date
they were constructed, including, without limitation, laws in

                                      -8-
<PAGE>

connection with life-fire safety, physical handicap, including earthquake
safety, then Sublandlord shall cause such noncompliance to be remedied. To the
extent any material variation to the final plans and specifications set forth on
Exhibit C hereto are necessary to obtain the approval, permits or certificates
from the Master Landlord or any governmental department, agency or authority
having competent jurisdiction, then such final plans and specifications, and the
Sublandlord Improvements, shall be subject to the reasonable approval of
Subtenant. Subtenant's review of the plans and specifications, shall be for its
sole purpose and shall not imply Subtenant's review of the same, or obligate
Subtenant to review the same, for quality, design, Applicable Laws compliance or
other like matters.

     17.  Release and Waiver of Subrogation:  Notwithstanding anything to the
          ---------------------------------
contrary in this Sublease, the parties hereto release each other and their
respective agents, employees, successors and assigns from all liability for
damage to any property that is actually covered by property insurance in force
or which would normally be covered by full replacement value "Special Form"
property insurance, without regard to the negligence or willful misconduct of
the entity so released.  Each party shall cause each insurance policy it obtains
to include a waiver of subrogation regarding the liabilities released hereby.
Sublandlord shall not be liable to Subtenant, nor shall Subtenant be entitled to
terminate this Sublease or to abate Rent for any reason, including, without
limitation, (i) failure or interruption of any utility system or service or (ii)
failure of Master Landlord to maintain the Subleased Premises as may be required
under the Master Lease.

     18.  Insurance:  Subtenant shall obtain and keep in full force and effect,
          ---------
at Subtenant's sole cost and expense, during the Term the insurance required to
be carried by the "Tenant" under the Master Lease. Subtenant shall include
Sublandlord and Master Landlord as an additional insured in any policy of
insurance carried by Subtenant in connection with this Sublease and shall
provide Sublandlord with certificates of insurance upon Sublandlord's request.

     19.  Default:  Subtenant shall be in material default of its obligations
          -------
under this Sublease if any of the following events occur:

             A.  Subtenant fails to pay any Rent within three (3) days after
written notice of nonpayment; or

             B.  Subtenant fails to perform any term, covenant or condition of
this Sublease (except those requiring payment of Rent) and fails to cure such
breach within twenty (20) days after delivery of a written notice specifying the
nature of the breach. If such cure cannot reasonably be completed within such
twenty (20)-day period, provided Subtenant has commenced such cure within such
twenty (20)-day period and diligently prosecutes such cure to completion,
Subtenant shall have such longer period reasonably necessary to complete such
cure up to a maximum of eighty (80) days; or

             C.  the bankruptcy or insolvency of Subtenant, transfer by
Subtenant in fraud of creditors, an assignment by Subtenant for the benefit of
creditors, or the commencement of any proceedings of any kind by or against
Subtenant under any provision of the Federal Bankruptcy Act or under any other
insolvency, bankruptcy or reorganization act unless, in the event any such
proceedings are involuntary, Subtenant is discharged from the same within thirty
(30) days thereafter;

             D.  the appointment of a receiver for a substantial part of the
assets of Subtenant, which receiver is not discharged within thirty (30) days;

             E.  the levy upon this Sublease or any estate of Subtenant
hereunder by any attachment or execution and the failure within thirty (30) days
thereafter to have such attachment or execution vacated or

                                      -9-
<PAGE>

such other action taken with respect thereto so as to put Sublandlord at no risk
of having an unconsented transfer of this Sublease;

             F.  Subtenant abandons the Subleased Premises; or

             G.  Subtenant commits any other act or omission which causes a
default to exist under the Master Lease, beyond applicable notice and cure
period.

     20.  Remedies:  In the event of any default by Subtenant, Sublandlord shall
          --------
have all remedies provided to the "Landlord" under Article 15 of the Master
Lease as if a "Default" had occurred thereunder and all other rights and
remedies otherwise available at law and in equity. Sublandlord may resort to its
remedies cumulatively or in the alternative. Without limiting the generality of
the foregoing, Sublandlord shall have the remedy described in California Civil
Code Section 1951.4 (Sublandlord may continue the Sublease in effect after
Subtenant's breach and abandonment and recover rent as it becomes due, if
Subtenant has right to sublet or assign, subject only to reasonable
limitations).

     21.  Surrender:  On or before the Expiration Date or any sooner termination
          ---------
of this Sublease, Subtenant shall remove all of its trade fixtures, personal
property and all alterations constructed by Subtenant in the Subleased Premises
which are required to be removed under the terms of this Sublease or the Master
Lease and shall surrender the Subleased Premises to Sublandlord in their
condition required under Section 16 of the Master Lease incorporated herein,
except to the extent such repairs or restoration are directly necessitated by
the negligence, gross negligence, or willful misconduct of the Sublandlord or
its agents, employees, officers, directors, members, partners, and/or
representatives. Subtenant shall repair any damage to the Subleased Premises
caused by Subtenant's removal of its personal property, furnishings and
equipment. If the Subleased Premises are not so surrendered, then Subtenant
shall be liable to Sublandlord for all costs incurred by Sublandlord in
returning the Subleased Premises to the required condition, plus interest
thereon at the Default Rate. In no event, however, shall Tenant be required to
remove the Sublandlord Improvements.

     22.  Furniture:  Subtenant shall have the right to use the portion of the
          ---------
furniture, furnishings and equipment (as described in Section 3.A of the Master
Lease) currently existing in the Subleased Premises and set forth on Exhibit D
                                                                     ---------
attached hereto subject to the terms of the Master Lease.  Subtenant shall
surrender such furniture, furnishings and equipment at the expiration or earlier
termination of the Sublease in as good condition as exists as of the
Commencement Date, reasonable wear and tear excepted.

     23.  Broker:  Sublandlord and Subtenant each represent to the other that
          ------
they have dealt with no real estate brokers, finders, agents or salesmen in
connection with this transaction other than Cornish & Carey representing both
Subtenant and Sublandlord. Subtenant and Sublandlord hereby agree to indemnify
and hold the other harmless from and against all claims for brokerage
commissions, finder's fees or other compensation made by any other agent,
broker, salesman or finder as a consequence of the indemnifying party's actions
or dealings with such other agent, broker, salesman, or finder.

     24.  Notices:  Unless at least five (5) days' prior written notice is given
          -------
in the manner set forth in this paragraph, the address of each party for all
purposes connected with this Sublease shall be that address set forth below
their signatures at the end of this Sublease. All notices, demands or
communications in connection with this Sublease shall be properly addressed and
delivered as follows: (a) personally delivered; or (b) submitted to an overnight
courier service, charges prepaid; or (c) deposited in the mail (certified,
return-receipt requested, and postage prepaid). Notices shall be deemed
delivered upon receipt, if personally delivered, one (1) business day after
being so submitted to an overnight courier service and two (2) business

                                      -10-
<PAGE>

days after deposit in the United States mail, if mailed as set forth above. All
notices given to Master Landlord under the Master Lease shall be considered
received only when delivered in accordance with the Master Lease. Each party
agrees to deliver to the other a copy of any default notice received from the
Master Landlord. Subtenant agrees to deliver to Sublandlord any other notice,
demand, request, consent or approval received from the Master Landlord.
Sublandlord agrees to deliver to Subtenant any other notice, demand, request,
consent or approval received from the Master Landlord with respect to the
Subleased Premises.

     25.  Other Sublease Terms:
          --------------------

              A.  Incorporation By Reference.  Except as set forth below and
                  --------------------------
except as otherwise provided in this Sublease, the terms and conditions of this
Sublease shall include all of the terms of the Master Lease, and except as set
forth below and except as otherwise provided in this Sublease, such terms are
incorporated into this Sublease as if fully set forth herein, except that: (i)
each reference in such incorporated sections to "Lease" shall be deemed a
reference to this "Sublease"; (ii) each reference to the "Premises" shall be
deemed a reference to the "Subleased Premises"; (iii) each reference to
"Landlord" shall be deemed a reference to "Sublandlord" and each reference to
"Tenant" shall be deemed a reference to "Subtenant", except as otherwise
expressly set forth herein; (iv) each reference to "Lease Term" shall be deemed
a reference to the "Term" of the Sublease; (v) each reference to the "Late
Charge" shall be deemed a reference to the "Late Charge" as defined herein; (vi)
each reference to any other term defined herein shall have the meaning given to
such term herein; (vii) with respect to work, services, utilities, electricity,
repairs (or damage caused by Master Landlord), restoration, insurance,
indemnities, reimbursements, representations, warranties or the performance of
any other obligation of "Landlord" under the Master Lease, whether or not
incorporated herein, the sole obligation of Sublandlord shall be to use diligent
good faith efforts to attempt to enforce all such obligations of Master Landlord
under the Master Lease (without requiring Sublandlord to spend more than a
nominal sum in excess of the amount Subtenant has agreed in writing to promptly
reimburse, which nominal sum shall be limited to all costs associated with the
preparation of and transmittal to Master Landlord of documentation from
Sublandlord or Sublandlord's attorneys detailing the obligations to be performed
by Master Landlord under the Master Lease), subject to Subtenant's rights under
Paragraph 8.B of this Sublease; (viii) with respect to any obligation of
Subtenant to be performed under this Sublease, wherever the Master Lease grants
to "Tenant" a specified number of days to perform its obligations under the
Master Lease (including, without limitation, curing any defaults), except as
otherwise provided herein, Subtenant shall have two (2) fewer days to perform
the obligation or one-half the time period permitted under the Master Lease (or
if less then two (2) days, the time period permitted under the Master Lease),
which ever allows Subtenant the greater amount of time; (ix) except as otherwise
provided in Section 11 hereof, with respect to any approval required to be
obtained from the "Landlord" under the Master Lease, such approval must be
obtained from both Master Landlord and Sublandlord, and Sublandlord's
withholding of approval shall in all events be deemed reasonable if for any
reason Master Landlord's approval is not obtained; (x) in any case where the
"Landlord" reserves or is granted the right to manage, supervise, control,
repair, alter, regulate the use of, enter or use the Premises or any areas
beneath, above or adjacent thereto, such reservation or grant of right of entry
shall be deemed to be for the benefit of both Master Landlord and Sublandlord;
(xi) in any case where "Tenant" is to indemnify, release or waive claims against
"Landlord", such indemnity, release or waiver shall be deemed to run from
Subtenant to both Master Landlord and Sublandlord; (xii) in any case where
"Tenant" is to execute and deliver certain documents or notices to "Landlord",
such obligation shall be deemed to run from Subtenant to both Master Landlord
and Sublandlord; and (xiii) the following modifications shall be made to the
Master Lease as incorporated herein:

                    (a)  the following provisions of the Master Lease are not
incorporated herein: Basic Lease Terms (except subparagraph 5), Sections 1.A,
1.B, 1.C, 2.A, 2.B.1, 2.D(2), 2.D(3) (first sentence), 3.A, 3.B, 3.C, 3.D, 4
(first two sentences), 5, 7.B (second and fourth sentences), 7.D (second

                                      -11-
<PAGE>

sentence), 8 (second sentence), 14, 17, 18.A (second sentence), 20, 22, 26, 28,
29.C (first sentence) and 29.R, Exhibits A and B and Rider 1;

                    (b)  The nonrecourse provisions of Section 21 of the Master
Lease shall apply only to the Master Landlord;

                    (c)  Subtenant will not have a right to abate rent through
incorporation of the provisions of the Master Lease in the event of a casualty
or condemnation where Sublandlord is not entitled to abate rent under the Master
Lease with respect to the Subleased Premises; and

                    (d)  The phrase "provided that Landlord may not install on
the exterior of the Building or on the Property a sign with the name of any
other party other than Tenant" under Section 13.B of the Master Lease shall not
be incorporated herein;

                    (e)  References to "Indemnities" in Section 18 of the Master
Lease shall be deemed a reference to the Indemnities (as defined in the Master
Lease) and Sublandlord and its agents, employees, directors, shareholders,
contractors and representatives;

                    (f)  Subtenant's obligations under Section 6 of the Master
Lease incorporated herein shall not apply with respect to the Sublandlord
Improvements;

                    (g)  Reference to "twelve (12) months" in Section 11.A shall
be replaced by six (6) months; and

                    (h)  Notwithstanding any provision in Paragraph 12 of the
Master Lease to the contrary, as incorporated herein, if all or any part of the
Subleased Premises is taken by eminent domain or transferred in lieu thereof,
then Subtenant shall have the right, within two months of the occurrence of such
event, to terminate this Sublease by delivery of written notice to the
Sublandlord if, and only if, in the reasonable opinion of Subtenant, the
Subleased Premises cannot, within three months of such occurrence, be used for
the purposes for which it was used immediately prior to such occurrence.

          B.  Assumption of Obligations.  This Sublease is and at all times
              -------------------------
shall be subject and subordinate to the Master Lease and the rights of Master
Landlord thereunder. Sublandlord agrees that it will not cause a default under
the Master Lease. Subtenant hereby expressly assumes and agrees: (i) not to
violated the terms of the Master Lease; and (ii) to perform all the obligations
on the part of the "Tenant" to be performed under the terms of the Master Lease
incorporated herein with respect to the Subleased Premises. In the event the
Master Lease is terminated for any reason whatsoever, this Sublease shall
terminate simultaneously with such termination without any liability of
Sublandlord to Subtenant, including, without limitation, any early termination
pursuant to Section 1.C of the Master Lease. Sublandlord, however, shall not
terminate the Master Lease (except as specifically permitted under the Master
Lease) or agree to an amendment of the Master Lease that would materially and
adversely affect Subtenant's use of the Subleased Premises or rights thereunder
without first obtaining Subtenant's prior written consent, which consent shall
not be unreasonably withheld. Sublandlord shall be liable to Subtenant for all
costs, expenses, liabilities, damages and injuries suffered by Subtenant
resulting from a termination of the Sublease as a direct result of (a) a
termination of the Master Lease in violation of the terms of the preceding
sentence (including reasonable costs and expenses incurred as a result thereof)
or (b) a termination of the Master Lease as a direct result of Sublandlord's
breach or default thereunder which were not directly caused by Subtenant.
Provided Subtenant performs all of its obligations under this Sublease, subject
to applicable notice and cure periods, Sublandlord shall pay, when due, all
"Rent" (as defined in the Master Lease) under the Master Lease and

                                      -12-
<PAGE>

shall perform its covenants and obligations of "Tenant" under the Master Lease
other than such covenants and obligations required of Subtenant to perform under
this Sublease. In the event of a conflict between the provisions of this
Sublease and the Master Lease, as between Sublandlord and Subtenant, the
provisions of this Sublease shall control.

     26.  Right to Contest:  If Sublandlord does not have the right to contest
          ----------------
any matter in the Master Lease due to expiration of any time limit that may be
set forth therein or for any other reason, then notwithstanding any
incorporation of any such provision from the Master Lease in this Sublease,
Subtenant shall also not have the right to contest any such matter.

     27.  Sublandlord Representations:  Sublandlord represents and warrants to
          ---------------------------
Subtenant that:  (a) Exhibit A to this Sublease is a full and complete copy of
                     ---------
the Master Lease; (b) the Master Lease, as of the date hereof, is in full force
and effect, and the Master Lease constitutes the entire agreement of Master
Landlord and Sublandlord relating to the lease of the Master Premises, (c) there
exists no event of default under the Master Lease and, to Sublandlord's current
actual knowledge, there exists no event which would constitute an event of
default under the Master Lease but for the giving of any required notice and
passage of any applicable grace or cure period; (d) the person or persons
executing this Sublease for Sublandlord are fully authorized to so act and no
other action is required to bind Sublandlord to this Sublease; (e) Sublandlord
has the right and power to execute and deliver this Sublease and to perform its
obligations hereunder subject, however, to Master Landlord's consent to this
Sublease, (f) to Sublandlord's best knowledge, "Substantial Completion" of the
"Landlord Work" (as such terms are defined under the Master Lease) has occurred,
all construction required and/or contemplated by the Master Lease is completed,
and a certificate of occupancy and all other necessary governmental requirements
have been issued and remain valid for the Master Premises, (g) to Sublandlord's
current actual knowledge, there exist no mechanics' or materialmen's liens
against the Master Premises, and to Sublandlord's current actual knowledge,
there exist no present circumstances which would with the passage of time result
in the existence or filing of a mechanics' and/or materialmen's lien against the
Master Premises.

     28.  Use of Cafeteria:
          ----------------

              A.  Subtenant acknowledges that the Sublandlord is currently
operating a cafeteria in the area shown on Exhibit B attached hereto (the
                                           ---------
"Cafeteria"). For so long as Sublandlord continues to operate the Cafeteria,
Subtenant's employees shall have the non-exclusive right to use the Cafeteria in
common with Sublandlord and other tenants in the Building and their respective
employees on a first-come, first-served basis. Use of the Cafeteria shall be
subject to payment by Subtenant's employees of the applicable charges for the
food and other items purchased therein and subject to the reasonable,
nondiscriminatory rules and regulations now or hereafter established by
Sublandlord from time to time regarding the use of the Cafeteria. Sublandlord
may at any time, in its sole discretion, discontinue the operation of the
Cafeteria.

              B.  Sublandlord may, at its election, grant its own employees
discounts on purchases in the Cafeteria and such discounts shall be solely
between Sublandlord and its employees and shall not apply to Subtenant or its
employees.

              C.  Sublandlord makes no representations or warranties of any kind
whatsoever regarding the Cafeteria, and Sublandlord shall incur no loss, cost,
liability or damage in connection with Subtenant's and its employees' use of the
Cafeteria. Subtenant and its employees shall use the Cafeteria at Subtenant's
and its employees' sole and entire risk. Accordingly, Subtenant hereby releases,
acquits and forever discharges Sublandlord and its agents, employees, directors,
shareholders, contractors and representatives, from and against any and all
losses, costs, claims, liabilities and damages arising from or relating in any

                                      -13-
<PAGE>

manner to Subtenant's or its employees' use of the Cafeteria. In addition,
Subtenant shall indemnify, defend (with counsel reasonably satisfactory to
Sublandlord) and hold harmless Sublandlord and its agents, employees, directors,
shareholders, contractors and representatives from and against all losses,
costs, claims, liabilities and damages (including reasonable attorneys' fees and
expenses) arising from or relating in any manner to Subtenant's or its
employees' use of the Cafeteria.

     29.  Parking:  Subtenant shall be entitled to the nonexclusive use of
          -------
Subtenant's pro rata share of unreserved parking spaces serving the Master
Premises.

     30.  Signage:   To the extent permitted by Master Landlord and subject to
          -------
the requirements of the Master Lease, Subtenant shall be entitled to the
following signage at Subtenant's sole cost and expense: (i) suite signage at the
entrance of the Subleased Premises subject to the prior written consent of
Sublandlord and Master Lessor; (ii) Subtenant's pro rata share of any monument
signage under the Master Lease subject to the prior written consent of
Sublandlord and Master Lessor.

     31.  Conditions Precedent:  Notwithstanding anything to the contrary in
          --------------------
this Sublease, this Sublease and Sublandlord's obligations hereunder are
conditioned upon Sublandlord's receipt of the written consent of Master Landlord
to this Sublease. If Sublandlord does not receive such consent within thirty
(30) days after execution of this Sublease by Sublandlord, then prior to
obtaining such consent, either Sublandlord or Subtenant may terminate this
Sublease by giving the other written notice thereof, and upon such termination,
Sublandlord shall return to Subtenant all prepaid rent and the Security Deposit.

     32.  Amendment:  This Sublease may not be amended except by the written
          ---------
agreement of all parties hereto.

     33.  No Drafting Presumption:  The parties acknowledge that this Sublease
          -----------------------
has been agreed to by both the parties, that both Sublandlord and Subtenant have
consulted with attorneys with respect to the terms of this Sublease and that no
presumption shall be created against Sublandlord because Sublandlord drafted
this Sublease.

     34.  Entire Agreement:  This Sublease constitutes the entire agreement
          ----------------
between the parties with respect to the subject matter herein, and there are no
binding agreements or representations between the parties except as expressed
herein. No subsequent change or addition to this Lease shall be binding unless
in writing and signed by the parties hereto.

     35.  Quiet Enjoyment:  Subject to the terms of the Sublease and subject to
          ---------------
the terms of the Master Lease, so long as Subtenant is not in default,
Subtenant's quiet and peaceable enjoyment of the Premises shall not be disturbed
or interfered with by Sublandlord, or by any person claiming by, through or
under Sublandlord.

     36.  Sublandlord Indemnity:  Except to the extent of the negligence or
          ---------------------
willful misconduct of Subtenant or its employees, agents, contractors, or
invitees, Sublandlord shall protect, defend, indemnify and hold harmless
Subtenant from any and all liability, costs, expenses, damages, liabilities,
claims, proceedings, actions and demands (including reasonable attorneys' fees)
to the extent caused by or arising in connection Sublandlord's default under the
Master Lease not caused by Subtenant.

     37.  Counterparts:  This Sublease may be executed in one (1) or more
          ------------
counterparts each of which shall be deemed an original but all of which together
shall constitute one (1) and the same instrument.

                                      -14-
<PAGE>

Signature copies may be detached from the counterparts and attached to a single
copy of this Sublease physically to form one (1) document.

                                      -15-
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Sublease as of the day
and year first above written.

SUBLANDLORD:                                SUBTENANT:

Loudcloud, Inc.,                            Docent, Inc.,
a Delaware corporation                      a Delaware corporation

By:                                         By:
   -------------------------------             -------------------------------

Print Name:                                 Print Name:
           -----------------------                     -----------------------
Title:                                      Title:
      ----------------------------                ----------------------------

Address:                                    Address:
        --------------------------                  --------------------------

599 N. Mathilda Avenue
Sunnyvale, CA  94086
Attention:
          ------------

                                      -16-
<PAGE>

                                   EXHIBIT A
                                   ---------

                                  MASTER LEASE

                                      -17-
<PAGE>

                                   EXHIBIT B
                                   ---------

                               SUBLEASED PREMISES

                                      -18-
<PAGE>

                                   EXHIBIT C
                                   ---------

                            SUBLANDLORD IMPROVEMENTS

                                      -19-
<PAGE>

                                   EXHIBIT D
                                   ---------

                      FURNITURE, FURNISHINGS AND EQUIPMENT

                                      -20-

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