Document:

<PAGE>

                                                                   EXHIBIT 10.10

                        FORM OF INDEMNIFICATION AGREEMENT

This Agreement is made as of the __ day of ___________ 200_, by and between
VelocityHSI, Inc., a Delaware Corporation ("the Company"), and the undersigned
director or officer of the Company (the "Indemnitee"), with reference to the
following facts:

The Indemnitee is currently serving as a director and/or officer of the Company
and the Company wishes the Indemnitee to continue in that capacity. The
Indemnitee is willing, under certain circumstances, to continue to serve in that
capacity.

The Indemnitee has indicated that he does not regard the indemnities available
under the Company's Bylaws as adequate to protect him against the risks
associated with his service to the Company and has noted that the Company's
directors' and officers' liability insurance policy has numerous exclusions and
a deductible and thus does not adequately protect Indemnitee. In this connection
the Company and the Indemnitee now agree they should enter into this
Indemnification Agreement in order to provide greater protection to Indemnitee
against such risks of service to the Company.

Section 145 of the General Corporation Law of the State of Delaware, under which
Law the Company is organized, empowers corporations to indemnify a person
serving as a director, officer, employee or agent of the corporation and a
person who serves at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust, or
other enterprise, and said Section 145 and the By-Laws of the Company specify
that the indemnification set forth in said Section 145 and in the By-Laws,
respectively, shall not be deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any By-Law, agreement, vote of
stockholders or disinterested directors or otherwise.

In order to induce the Indemnitee to continue to serve as a director or officer
of the Company and in consideration of his continued service, the Company hereby
agrees to indemnify the Indemnitee as follows:

1.    Indemnity. The Company will indemnify the Indemnitee, his executors,
      administrators or assigns, for any Expenses (as defined below) which the
      Indemnitee is or becomes legally obligated to pay in connection with any
      Proceeding. As used in this Agreement the term "Proceeding" shall include
      any threatened, pending or completed claim, action, suit or proceeding,
      whether brought by or in the right of the Company or otherwise and whether
      of a civil, criminal, administrative or investigative nature, in which the
      Indemnitee may be or may have been involved as a party or otherwise, by
      reason of the fact that Indemnitee is or was a director or officer of the
      Company, by reason of any actual or alleged error or misstatement or
      misleading statement made or suffered by the Indemnitee, by reason of any
      action taken by him or of any inaction on his part while acting as such
      director or officer, or by reason of the fact that he was serving at the
      request of the Company as a director, trustee, officer, employee or agent
      of another corporation, partnership, joint venture, trust or other
      enterprise; provided, that in each such case Indemnitee acted in good
      faith and in a manner which he reasonably believed to be in or not opposed
      to the best interests of the Company, and, in the case of a criminal
      proceeding, in addition had no reasonable cause to believe that his
      conduct was unlawful; provided however, that, except as provided in
      Section 3 hereof, the Company shall indemnify Indemnitee in connection
      with a Proceeding initiated by Indemnitee only if such proceeding (or part
      thereof) was authorized by a two-thirds vote of the Board of Directors of
      the Company. As used in this Agreement, the term "other enterprise" shall
      include (without limitation) employee benefit plans and administrative
      committees thereof, and the term "fines" shall include (without
      limitations) any excise tax assessed with respect to any employee benefit
      plan.

2.    Expenses. As used in this Agreement, the term "Expenses" shall include,
      without limitation, damages, judgments, fines, penalties, settlements and
      costs, attorneys' fees and disbursements and costs of attachment or
      similar bonds, investigations, and any expenses of establishing a right to
      indemnification under this Agreement.

3.    Enforcement. If a claim or request under this Agreement is not paid by the
      Company, or on its behalf, within thirty days after a written claim or
      request has
<PAGE>

      been received by the Company, the Indemnitee may at any time thereafter
      bring suit against the Company to recover the unpaid amount of the claim
      or request and if successful in whole or in part, the Indemnitee shall be
      entitled to be paid also the Expenses of prosecuting such suit. The
      Company shall have the right to recoup from the Indemnitee the amount of
      any item or items of Expenses theretofore paid by the Company pursuant to
      this Agreement, to the extent such Expenses are not reasonable in nature
      or amounts; provided, however, that the Company shall have the burden of
      proving such Expenses to be unreasonable. The burden of proving that the
      Indemnitee is not entitled to indemnification for any other reason shall
      be upon the Company.

4.    Subrogation. In the event of payment under this Agreement, the Company
      shall be subrogated to the extent of such payment to all of the rights of
      recovery of the Indemnitee, who shall execute all papers required and
      shall do everything that may be necessary to secure such rights, including
      the execution of such documents necessary to enable the Company
      effectively to bring suit to enforce such rights.

5.    Exclusions. The Company shall not be liable under this Agreement to pay
      any Expenses in connection with any claim made against the Indemnitee:

      5.1.  to the extent that payment is actually made to the Indemnitee under
            a valid, enforceable and collectible insurance policy;

      5.2.  to the extent that the Indemnitee is indemnified and actually paid
            otherwise than pursuant to this Agreement;

      5.3.  in connection with a judicial action by or in the right of the
            Company, in respect of any claim, issue or matter as to which the
            Indemnitee shall have been adjudged to be liable for negligence or
            misconduct in the performance of his duty to the Company unless and
            only to the extent that any court in which such action was brought
            shall determine upon application that, despite the adjudication of
            liability but in view of all the circumstances of the case, the
            Indemnitee is fairly and reasonably entitled to indemnity for such
            expenses as such court shall deem proper;

      5.4.  if it is proved by final judgment in a court of law or other final
            adjudication to have been based upon or attributable to the
            Indemnitee's in fact having gained any personal profit or advantage
            to which he was not legally entitled;

      5.5.  for a disgorgement of profits made from the purchase and sale by the
            Indemnitee of securities pursuant to Section 16(b) of the Securities
            Exchange Act of 1934 and amendments thereto or similar provisions of
            any state statutory law or common law;

      5.6.  brought about or contributed to by the dishonesty of the Indemnitee
            seeking payment hereunder; provided, however, notwithstanding the
            foregoing, the Indemnitee shall be protected under this Agreement as
            to any claims upon which suit may be brought against him by reason
            of any alleged dishonesty on his part, unless a judgment or other
            final adjudication thereof adverse to the Indemnitee shall establish
            that he committed (i) acts of active and deliberate dishonesty, (ii)
            with actual dishonest purpose and intent, (iii) which acts were
            material to the cause of action so adjudicated; or

      5.7.  for any judgment, fine or penalty which the Company is prohibited by
            applicable law from paying as indemnity or for any other reason.

6.    Indemnification of Expenses of Successful Party. Notwithstanding any other
      provision of this Agreement, to the extent that the Indemnitee has been
      successful on the merits or otherwise in defense of any Proceeding or in
      defense of any claim, issue or matter therein, including dismissal without
      prejudice, Indemnitee shall be indemnified against any and all Expenses
      incurred in connection therewith.

7.    Partial Indemnification. If the Indemnitee is entitled under any provision
      of this Agreement to indemnification by the Company for some or a portion
      of Expenses, but not, however, for the total amount thereof, the Company
      shall nevertheless indemnify the Indemnitee for the portion of such
      Expenses to which the Indemnitee is entitled.

8.    Advance of Expenses. Expenses incurred by the Indemnitee in connection
      with any Proceeding, except the amount of any settlement, shall be paid by
      the

                                       56
<PAGE>

      Company in advance upon request of the Indemnitee that the Company pay
      such Expenses. The Indemnitee hereby undertakes to repay to the Company
      the amount of any Expenses theretofore paid by the Company to the extent
      that it is ultimately determined that such Expenses were not reasonable or
      that the Indemnitee is not entitled to indemnification.

9.    Approval of Expenses. No Expenses for which indemnity shall be sought
      under this Agreement, other than those in respect of judgments and
      verdicts actually rendered, shall be incurred without the prior consent of
      the Company, which consent shall not be unreasonably withheld.

10.   Notice of Claim. The Indemnitee, as a condition precedent to his right to
      be indemnified under this Agreement, shall give to the Company notice in
      writing as soon as practicable of any claim made against him for which
      indemnity will or could be sought under this Agreement. Notice to the
      Company shall be given at its principal office and shall be directed to
      the Corporate Secretary (or such other address as the Company shall
      designate in writing to the Indemnitee); notice shall be deemed received
      if sent by prepaid mail properly addressed, the date of such notice being
      the date postmarked. In addition, the Indemnitee shall give the Company
      such information and cooperation as it may reasonably require and as shall
      be within the Indemnitee's power.

Counterparts. This Agreement may be executed in any number of counterparts, all
      of which taken together shall constitute one instrument.

Indemnification Hereunder Not Exclusive. Nothing herein shall be deemed to
      diminish or otherwise restrict the Indemnitee's right to indemnification
      under any provision of the Certificate of Incorporation or By-Laws of the
      Company and amendments thereto or under law.

Governing Law. This Agreement shall be governed by and construed in accordance
      with Delaware law.

Saving Clause. Wherever there is conflict between any provision of this
      Agreement and any applicable present or future statute, law or regulation
      contrary to which the Company and the Indemnitee have no legal right to
      contract, the latter shall prevail, but in such event the affected
      provisions of this Agreement shall be curtailed and restricted only to the
      extent necessary to bring them within applicable legal requirements.

Coverage. The provisions of this Agreement shall apply with respect to the
      Indemnitee's service as a director or officer of the Company prior to the
      date of this Agreement and with respect to all periods of such service
      after the date of this Agreement, even though the Indemnitee may have
      ceased to be a director or officer of the Company.

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and signed as of the day and year first above written.

                                          VELOCITYHSI, INC.,
                                          a Delaware corporation

                                          By:
                                             ----------------------------------
                                          Name:
                                          Title:

                                          INDEMNITEE:

                                          -------------------------------------
                                          Name:<PAGE>

                                                                   EXHIBIT 10.11

                                  OFFICE LEASE

                                     BETWEEN

                 METROPOLITAN LIFE INSURANCE COMPANY (LANDLORD)

                                       AND

                          BRE PROPERTIES, INC. (TENANT)

                               MOUNT DIABLO PLAZA

                            Walnut Creek, California
<PAGE>

                                    TABLE OF CONTENTS

                                                                            PAGE

ARTICLE ONE - BASIC LEASE PROVISIONS.........................................1
      1.01 BASIC LEASE PROVISIONS............................................1
      1.02 ENUMERATION OF EXHIBITS...........................................2
      1.03 DEFINITIONS.......................................................2

ARTICLE TWO - PREMISES, TERM, FAILURE TO GIVE POSSESSION, AND PARKING........5
      2.01 LEASE OF PREMISES.................................................5
      2.02 TERM..............................................................5
      2.03 FAILURE TO GIVE POSSESSION........................................5
      2.04 AREA OF PREMISES..................................................6
      2.05 CONDITION OF PREMISES.............................................6
      2.06 PARKING...........................................................6

ARTICLE THREE - RENT.........................................................7

ARTICLE FOUR - RENT ADJUSTMENTS AND PAYMENTS.................................7
      4.01 RENT ADJUSTMENTS..................................................7
      4.02 STATEMENT OF LANDLORD.............................................7
      4.03 BOOKS AND RECORDS.................................................8
      4.04 PARTIAL OCCUPANCY.................................................8
      4.05 TENANT OR LEASE SPECIFIC TAXES....................................8

ARTICLE FIVE - SECURITY DEPOSIT..............................................8

ARTICLE SIX - SERVICES.......................................................9
      6.01 LANDLORD'S GENERAL SERVICES.......................................9
      6.02 ELECTRICAL SERVICES...............................................9
      6.03 ADDITIONAL AND AFTER-HOUR SERVICES...............................10
      6.04 PHONE SERVICES...................................................10
      6.05 DELAYS IN FURNISHING SERVICES....................................10
      6.06 CHOICE OF SERVICE PROVIDER.......................................11
      6.07 SIGNAGE..........................................................11

ARTICLE SEVEN - POSSESSION, USE AND CONDITION OF PREMISES...................11
      7.01 POSSESSION AND USE OF PREMISES...................................11
      7.02 LANDLORD ACCESS TO PREMISES; APPROVALS...........................12
      7.03 QUIET ENJOYMENT..................................................13

ARTICLE EIGHT - MAINTENANCE.................................................13
      8.01 LANDLORD'S MAINTENANCE...........................................13
      8.02 TENANT'S MAINTENANCE.............................................13

ARTICLE NINE - ALTERATIONS AND IMPROVEMENTS.................................13
      9.01 TENANT ALTERATIONS...............................................13
      9.02 LIENS............................................................14

ARTICLE TEN - ASSIGNMENT AND SUBLETTING.....................................14
      10.01 ASSIGNMENT AND SUBLETTING.......................................14
      10.02 RECAPTURE.......................................................15
      10.03 EXCESS RENT.....................................................15
      10.04 TENANT LIABILITY................................................16
      10.05 ASSUMPTION AND ATTORNMENT.......................................16

ARTICLE ELEVEN - DEFAULT AND REMEDIES.......................................16
      11.01 EVENTS OF DEFAULT...............................................16
      11.02 LANDLORD'S REMEDIES.............................................17
      11.03 ATTORNEY'S FEES.................................................18
      11.04 BANKRUPTCY......................................................18
      11.05 LANDLORD'S DEFAULT..............................................19

ARTICLE TWELVE - SURRENDER OF PREMISES......................................19
      12.01 IN GENERAL......................................................19
      12.02 LANDLORD'S RIGHTS...............................................19

ARTICLE THIRTEEN - HOLDING OVER.............................................19

ARTICLE FOURTEEN - DAMAGE BY FIRE OR OTHER CASUALTY.........................20

                                       i
<PAGE>

      14.01 SUBSTANTIAL UNTENANTABILITY.....................................20
      14.02 INSUBSTANTIAL UNTENANTABILITY...................................20
      14.03 RENT ABATEMENT..................................................20
      14.04 WAIVER OF STATUTORY REMEDIES....................................21

ARTICLE FIFTEEN - EMINENT DOMAIN............................................21
      15.01 TAKING OF WHOLE OR SUBSTANTIAL PART.............................21
      15.02 TAKING OF PART..................................................21
      15.03 COMPENSATION....................................................21

ARTICLE SIXTEEN - INSURANCE.................................................21
      16.01 TENANT'S INSURANCE..............................................21
      16.02 FORM OF POLICIES................................................21
      16.03 LANDLORD'S INSURANCE............................................22
      16.04 WAIVER OF SUBROGATION...........................................22
      16.05 NOTICE OF CASUALTY..............................................23

ARTICLE SEVENTEEN - WAIVER OF CLAIMS AND INDEMNITY..........................23
      17.01 WAIVER OF CLAIMS................................................23
      17.02 INDEMNITY BY TENANT.............................................23

ARTICLE EIGHTEEN - RULES AND REGULATIONS....................................23
      18.01 RULES...........................................................23
      18.02 ENFORCEMENT.....................................................23

ARTICLE NINETEEN - LANDLORD'S RESERVED RIGHTS...............................24

ARTICLE TWENTY - ESTOPPEL CERTIFICATE.......................................24
      20.01 IN GENERAL......................................................24
      20.02 ENFORCEMENT.....................................................24

ARTICLE TWENTY-ONE - RELOCATION OF TENANT...................................24

ARTICLE TWENTY-TWO - REAL ESTATE BROKERS....................................24

ARTICLE TWENTY-THREE - MORTGAGEE PROTECTION.................................25
      23.01 SUBORDINATION AND ATTORNMENT....................................25
      23.02 MORTGAGEE PROTECTION............................................25

ARTICLE TWENTY-FOUR - NOTICES...............................................25

ARTICLE TWENTY-FIVE - STORAGE SPACE.........................................26
      25.01 IN GENERAL......................................................26
      25.02 STORAGE SPACE RENT..............................................26
      25.03 RELOCATION......................................................26

ARTICLE TWENTY-SIX - MISCELLANEOUS..........................................26
      26.01 LATE CHARGES....................................................26
      26.02 NO JURY TRIAL; VENUE; JURISDICTION..............................26
      26.03 DEFAULT UNDER OTHER LEASE.......................................27
      26.04 OPTION..........................................................27
      26.05 TENANT AUTHORITY................................................27
      26.06 ENTIRE AGREEMENT................................................27
      26.07 MODIFICATION OF LEASE FOR BENEFIT OF MORTGAGEE..................27
      26.08 EXCULPATION.....................................................27
      26.09 ACCORD AND SATISFACTION.........................................27
      26.10 LANDLORD'S OBLIGATIONS ON SALE OF BUILDING......................27
      26.11 BINDING EFFECT..................................................28
      26.12 CAPTIONS........................................................28
      26.13 TIME; APPLICABLE LAW; CONSTRUCTION..............................28
      26.14 ABANDONMENT.....................................................28
      26.15 LANDLORD'S RIGHT TO PERFORM TENANT'S DUTIES.....................28
      26.16 SECURITY SYSTEM.................................................28
      26.17 NO LIGHT, AIR OR VIEW EASEMENTS.................................28
      26.18 RECORDATION.....................................................28
      26.19 SURVIVAL........................................................28
      26.20 RIDERS..........................................................29

                                       ii
<PAGE>

                                        OFFICE LEASE

                                       ARTICLE ONE
                                  BASIC LEASE PROVISIONS

1.01  BASIC LEASE PROVISIONS

In the event of any conflict between these Basic Lease Provisions and any other
Lease provision, such other Lease provision shall control.

(1)   BUILDING AND ADDRESS:

      2175 N. California Boulevard
      Walnut Creek, California  94596

(2)   LANDLORD AND ADDRESS:

      Metropolitan Life Insurance Company,
      a New York corporation

      Notices to Landlord shall be addressed:

            Metropolitan Life Insurance Company
            c/o Mount Diablo Plaza Project Manager
            2185 N. California Boulevard, Suite 285
            Walnut Creek, CA  94596

            with copies to the following:

                  Metropolitan Life Insurance Company
                  400 South El Camino Real, 8th Floor
                  San Mateo, CA  94402
                  Attention: EIM Manager, Real Estate Investments

                              and

                  Metropolitan Life Insurance Company
                  400 South El Camino Real, 8th Floor
                  San Mateo, CA  94402
                  Attention: Associate General Counsel

(3)   TENANT AND CURRENT ADDRESS:

      (a)   Name:                       BRE Properties, Inc.

      (b)   State of incorporation:     Maryland

      Notices to Tenant shall be addressed:

            BRE Properties, Inc.
            44 Montgomery Street, 36th Floor
            San Francisco, CA  94104
            Attention:  Sandra Limas

(4)   DATE OF LEASE: as of April 24, 2000

(5)   LEASE TERM: five (5) years

(6)   PROJECTED COMMENCEMENT DATE: July 1, 2000

(7)   PROJECTED EXPIRATION DATE: five (5) years after the Commencement Date

(8)   MONTHLY BASE RENT:

      Period from/to          Monthly        Monthly Rate/SF of Rentable Area
      --------------          -------        --------------------------------

      Months 01 - 12         $26,112.50               $2.50
      Months 13 - 24         $26,634.75               $2.55
      Months 25 - 36         $27,157.00               $2.60
      Months 37 - 48         $27,679.25               $2.65
      Months 49 - 60         $28,201.50               $2.70

(9)   RENTABLE AREA OF THE PROJECT: 307,000 square feet

(10)  RENTABLE AREA OF THE PREMISES: 10,445 square feet

                                       1
<PAGE>

(11)  SECURITY DEPOSIT: Twenty-eight Thousand Two Hundred and One Dollars 50/100
      ($28,201.50)

(12)  SUITE NUMBER OF PREMISES:           810

(13)  TENANT'S SHARE:                     3.4023%

(14)  OPERATING EXPENSES BASE YEAR:       The calendar year 2000

(15)  TAXES BASE YEAR:                    The calendar year 2000

(16)  TENANT'S USE OF PREMISES:           General office use.

(17)  PARKING SPACES:

      Starting on the Commencement Date and continuing during the Term, Tenant
      shall have the use of parking stalls of the number and type described
      below, for which the monthly charge shall be the prevailing rates as
      described in Section 2.06, which as of the date of this Lease are agreed
      to be the amounts set forth below, and it is understood and agreed such
      rates are subject to increase from time to time as provided in Section
      2.06.

      14 unassigned single vehicle stalls (parking a total of 14 vehicles),
      initially at $55.00/stall/month

      8 assigned tandem stalls (parking a total of 16 vehicles), initially at
      $75.00/stall/month

(18)  BROKERS:

      Landlord's Broker:      CB Richard Ellis, Inc.

      Tenant's Broker:        CB Richard Ellis, Inc.

1.02  ENUMERATION OF EXHIBITS & RIDER(S)

The Exhibits and Rider(s) set forth below and attached to this Lease are
incorporated in this Lease by this reference:

EXHIBIT A  Plan of Premises

EXHIBIT B  Workletter Agreement

EXHIBIT C  Rules and Regulations

RIDER 1    Commencement Date Agreement

RIDER 2    Additional Provisions

1.03  DEFINITIONS

For purposes hereof, the following terms shall have the following meanings:

ADJUSTMENT YEAR: The applicable calendar year or any portion thereof after the
Operating Expenses Base Year and Taxes Base Year for which a Rent Adjustment
computation is being made.

AFFILIATE: Any Person (as defined below) which is currently owned or controlled
by, owns or controls, or is under common ownership or control with Tenant. For
purposes of this definition, the word "control," as used above means, with
respect to a Person that is a corporation, the right to exercise, directly or
indirectly, more than sixty percent (60%) of the voting rights attributable to
the shares of the controlled corporation and, with respect to a Person that is
not a corporation, the possession, directly or indirectly, of the power at all
times to direct or cause the direction of the management and policies of the
controlled Person. The word Person means an individual, partnership, trust,
corporation, firm or other entity.

BUILDING: The office building located at the address specified in Section
1.01(1).

COMMENCEMENT DATE: The date specified in Section 1.01(6) as the Projected
Commencement Date, unless changed by operation of Article Two.

COMMON AREAS: All areas of the Project made available by Landlord from time to
time for the general common use or benefit of the tenants of the Building, and
their employees and invitees, or the public, as such areas currently exist and
as they may be changed from time to time.

DECORATION: Tenant Alterations which do not require a building permit and which
do not involve any of the structural elements of the Building, or any of the
Building's systems, including its electrical, mechanical, plumbing, security,
heating, ventilating, air-conditioning, communication, and fire and life safety
systems.

DEFAULT RATE: Two (2) percentage points above the rate then most recently
announced by Bank of America N.T.& S.A. at its San Francisco main office as its
corporate base lending rate, from time to time announced, but in no event higher
than the maximum rate permitted by Law.

                                       2
<PAGE>

ENVIRONMENTAL LAWS: All Laws governing the use, storage, disposal or generation
of any Hazardous Material, including the Comprehensive Environmental Response
Compensation and Liability Act of 1980, as amended, and the Resource
Conservation and Recovery Act of 1976, as amended.

EXPIRATION DATE: The date specified in Section 1.01(7) unless changed by
operation of Article Two.

FORCE MAJEURE: Any accident, casualty, act of God, war or civil commotion,
strike or labor troubles, or any cause whatsoever beyond the reasonable control
of Landlord, including water shortages, energy shortages or governmental
preemption in connection with an act of God, a national emergency, or by reason
of Law, or by reason of the conditions of supply and demand which have been or
are affected by act of God, war or other emergency.

HAZARDOUS MATERIAL: Such substances, material and wastes which are or become
regulated under any Environmental Law; or which are classified as hazardous or
toxic under any Environmental Law; and explosives and firearms, radioactive
material, asbestos, and polychlorinated biphenyls.

INDEMNITEES: Collectively, Landlord, any Mortgagee or ground lessor of the
Property, the property manager and the leasing manager for the Property and
their respective directors, officers, agents and employees.

LAND: The parcel(s) of real estate on which the Building and Project are
located.

LANDLORD WORK: The construction or installation of improvements to the Premises,
to be furnished by Landlord, specifically described in the Workletter or other
Exhibits attached hereto.

LAWS OR LAW: All laws, ordinances, rules, regulations, other requirements,
orders, rulings or decisions adopted or made by any governmental body, agency,
department or judicial authority having jurisdiction over the Property, the
Premises or Tenant's activities at the Premises and any covenants, conditions or
restrictions of record which affect the Property.

LEASE: This instrument and all exhibits and riders attached hereto, as may be
amended from time to time.

LEASE YEAR: The twelve month period beginning on the first day of the first
month following the Commencement Date (unless the Commencement Date is the first
day of a calendar month in which case beginning on the Commencement Date), and
each subsequent twelve month, or shorter, period until the Expiration Date.

MONTHLY BASE RENT: The monthly rent specified in Section 1.01(8).

MORTGAGEE: Any holder of a mortgage, deed of trust or other security instrument
encumbering the Property.

NATIONAL HOLIDAYS: New Year's Day, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day and other holidays recognized by the Landlord
and the janitorial and other unions servicing the Building in accordance with
their contracts.

OPERATING EXPENSES: All costs, expenses and disbursements of every kind and
nature which Landlord shall pay or become obligated to pay in connection with
the ownership, management, operation, maintenance, replacement and repair of the
Property (including the amortized portion of any capital expenditure or
improvement, together with interest thereon, and the costs of changing utility
service providers). Operating Expenses shall not include, (i) costs of
alterations of the premises of tenants of the Project, (ii) costs of capital
improvements to the Project (except for amortized portion of capital
improvements installed for the purpose of reducing or controlling Operating
Expenses or complying with applicable Laws), (iii) depreciation charges, (iv)
interest and principal payments on loans (except for loans for capital
expenditures or improvements which Landlord is allowed to include in Operating
Expenses as provided above), (v) ground rental payments, (vi) real estate
brokerage and leasing commissions, (vii) advertising and marketing expenses,
(viii) costs of Landlord reimbursed by insurance proceeds, (ix) expenses
incurred in negotiating leases of other tenants in the Project or enforcing
lease obligations of other tenants in the Project and (x) Landlord's or
Landlord's property manager's corporate general overhead or corporate general
administrative expenses. If any Operating Expense, though paid in one year,
relates to more than one calendar year, at the option of Landlord such expense
may be proportionately allocated among such related calendar years.

OPERATING EXPENSES BASE YEAR: The calendar year designated in Section 1.01(14).

PREMISES: The space located in the Building at the Suite Number listed in
Section 1.01(12) and depicted on Exhibit A attached hereto.

PROJECT or PROPERTY: The Project consists of two office buildings (including the
Building) whose present street addresses are 2175 and 2185 N. California
Boulevard, Walnut Creek, California, associated parking facility, plaza and
improvements, together with the Land, any associated interests in real property,
and the personal property, fixtures, machinery, equipment, systems and apparatus
located in or used in conjunction with any of the foregoing. The Project may
also be referred to as the Property.

REAL PROPERTY: The Property excluding any personal property.

RENT: Collectively, Monthly Base Rent, Storage Space Rent, Rent Adjustments and
Rent Adjustment Deposits, and all other charges, payments, late fees or other
amounts required to be paid by Tenant under this Lease.

RENT ADJUSTMENT: Any amounts owed by Tenant for payment of Operating Expenses or
Taxes. The Rent Adjustments shall be determined and paid as provided in Article
Four.

                                       3
<PAGE>

RENT ADJUSTMENT DEPOSIT: An amount equal to Landlord's estimate of the Rent
Adjustment attributable to each month of the applicable Adjustment Year. On or
before the beginning of each Adjustment Year or with Landlord's Statement
(defined in Article Four), Landlord may estimate and notify Tenant in writing of
its estimate of the excess, if any, of Operating Expenses over those for the
Operating Expenses Base Year and of Taxes over those for the Taxes Base Year.
Prior to the first determination by Landlord of the amount of Operating Expenses
for the Operating Expenses Base Year and of Taxes for the Taxes Base Year,
Landlord may estimate such amounts in the foregoing calculation. The last
estimate by Landlord shall remain in effect as the applicable Rent Adjustment
Deposit unless and until Landlord notifies Tenant in writing of a change.

RENTABLE AREA OF THE PREMISES: The amount of square footage set forth in Section
1.01(10).

RENTABLE AREA OF THE PROJECT: The amount of square footage set forth in Section
1.01(9), which represents the sum of the rentable area of all space intended for
occupancy in the Project.

SECURITY DEPOSIT: The funds specified in Section 1.01(11), if any, deposited by
Tenant with Landlord as security for Tenant's performance of its obligations
under this Lease.

STANDARD OPERATING HOURS: Monday through Friday from 8:00 A.M. to 6:00 P.M. and
Saturday from 9:00 A.M. to 1:00 P.M., excluding National Holidays.

SUBSTANTIALLY COMPLETE: The completion of the Landlord Work or Tenant Work, as
the case may be, except for minor insubstantial details of construction,
decoration or mechanical adjustments which remain to be done.

TAXES: All federal, state and local governmental taxes, assessments and charges
of every kind or nature, whether general, special, ordinary or extraordinary,
which Landlord shall pay or become obligated to pay because of or in connection
with the ownership, leasing, management, control or operation of the Property or
any of its components (including any personal property used in connection
therewith), which may also include any rental or similar taxes levied in lieu of
or in addition to general real and/or personal property taxes. For purposes
hereof, Taxes for any year shall be Taxes which are assessed for any period of
such year, whether or not such Taxes are billed and payable in a subsequent
calendar year. There shall be included in Taxes for any year the amount of all
fees, costs and expenses (including reasonable attorneys' fees) paid by Landlord
during such year in seeking or obtaining any refund or reduction of Taxes. Taxes
for any year shall be reduced by the net amount of any tax refund received by
Landlord attributable to such year. If a special assessment payable in
installments is levied against any part of the Property, Taxes for any year
shall include only the installment of such assessment and any interest payable
or paid during such year. Taxes shall not include any federal or state
inheritance, general income, gift or estate taxes, except that if a change
occurs in the method of taxation resulting in whole or in part in the
substitution of any such taxes, or any other assessment, for any Taxes as above
defined, such substituted taxes or assessments shall be included in the Taxes.

TAXES BASE YEAR: The calendar year designated in Section 1.01(15).

TENANT ADDITIONS: Collectively, Landlord Work, Tenant Work and Tenant
Alterations.

TENANT ALTERATIONS: Any alterations, improvements, additions, installations or
construction in or to the Premises or any Real Property systems serving the
Premises (excluding Landlord Work or Tenant Work); and any supplementary
air-conditioning systems installed by Landlord or by Tenant at Landlord's
request pursuant to Section 6.01(b).

TENANT DELAY: Any event or occurrence which delays the Substantial Completion of
the Landlord Work which is caused by or is described as follows:

      (i) special work, changes, alterations or additions requested or made by
      Tenant in the design or finish in any part of the Premises after approval
      of the plans and specifications (as described in the Workletter);

      (ii) Tenant's delay in submitting plans, supplying information, approving
      plans, specifications or estimates, giving authorizations or otherwise;

      (iii) failure to approve and pay for such Tenant Work as Landlord
      undertakes to complete at Tenant's expense;

      (iv) the performance or completion by Tenant or any person engaged by
      Tenant of any work in or about the Premises; or

      (v) failure to perform or comply with any obligation or condition binding
      upon Tenant pursuant to the Workletter, including the failure to approve
      and pay for such Landlord Work or other items if and to the extent the
      Workletter provides they are to be approved or paid by Tenant.

TENANT WORK: All work installed or furnished to the Premises by Tenant pursuant
to the Workletter.

TENANT'S SHARE: The percentage specified in Section 1.01(13) which represents
the ratio of the Rentable Area of the Premises to the Rentable Area of the
Project.

TERM: The term of this Lease commencing on the Commencement Date and expiring on
the Expiration Date.

                                       4
<PAGE>

TERMINATION DATE: The Expiration Date or such earlier date as this Lease
terminates or Tenant's right to possession of the Premises terminates.

WORKLETTER: The Agreement regarding the manner of completion of Landlord Work
and Tenant Work set forth on Exhibit B attached hereto.

                                   ARTICLE TWO

             PREMISES, TERM, FAILURE TO GIVE POSSESSION, AND PARKING

2.01  LEASE OF PREMISES

Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the
Premises for the Term and upon the terms, covenants and conditions provided in
this Lease. In the event Landlord delivers possession of the Premises to Tenant
prior to the Commencement Date, Tenant shall be subject to all of the terms,
covenants and conditions of this Lease (except with respect to the payment of
Rent) as of the date of such possession.

2.02  TERM

      (a) The Commencement Date shall be the date determined as follows:

            (1) If the Landlord Work is Substantially Complete on or before the
Projected Commencement Date then on the date which is the earlier to occur of

                  (i) the Projected Commencement Date, or

                  (ii) the date Tenant first occupies all or part of the
                  Premises for the conduct of business; or

            (2) If the Landlord Work is not Substantially Complete by the
Projected Commencement Date, then on the date on which the Landlord Work is
Substantially Complete.

      (b) Within thirty (30) days following the occurrence of the Commencement
Date, Landlord and Tenant shall enter into an agreement (which is attached
hereto as Rider 1) confirming the Commencement Date and the Expiration Date. If
Tenant fails to enter into such agreement, then the Commencement Date and the
Expiration Date shall be the dates designated by Landlord in such agreement.

2.03  FAILURE TO GIVE POSSESSION

If the Landlord shall be unable to give possession of the Premises on the
Projected Commencement Date by reason of the following: (i) the Building has not
been sufficiently completed to make the Premises ready for occupancy, (ii) the
Landlord Work is not Substantially Complete, (iii) the holding over or retention
of possession of any tenant, tenants or occupants, or (iv) for any other reason,
then Landlord shall not be subject to any liability for the failure to give
possession on said date. Under such circumstances the rent reserved and
covenanted to be paid herein shall not commence until the Premises are made
available to Tenant by Landlord, and no such failure to give possession on the
Projected Commencement Date shall affect the validity of this Lease or the
obligations of the Tenant hereunder. At the option of Landlord to be exercised
within thirty (30) days of the delayed delivery of possession to Tenant, the
Lease shall be amended so that the term shall be extended by the period of time
possession is delayed. The said Premises shall be deemed to be ready for
Tenant's occupancy and Substantially Complete in the event Landlord's Work is
Substantially Complete in fact, or if the delay in the availability of the
Premises for occupancy shall be due to any Tenant Delay and/or default on the
part of Tenant and/or its subtenant or subtenants. In the event of any dispute
as to whether the Landlord Work is Substantially Complete, the decision of
Landlord's architect shall be final and binding on the parties. Notwithstanding
any provision of this Section to the contrary, in either event described below,
as Tenant's sole and exclusive remedy, Tenant shall have the option to terminate
this Lease on the terms and conditions described below:

            (a) if on or before August 1, 2000 (the "Recovery Deadline")
      Landlord does not have possession of the Premises, including possession of
      that part of such space which as of the date hereof is occupied by a third
      party, Tenant shall have the option exercisable by giving written notice
      to Landlord within three (3) business days after the Recovery Deadline to
      terminate this Lease. If Tenant does not timely give notice of its
      election to terminate this Lease as aforesaid and if Landlord does not
      have possession of the Premises on or before the date which is thirty (30)
      days following the Recovery Deadline, then Tenant shall again have the
      option to terminate this Lease in the manner described above and such date
      shall constitute the new Recovery Deadline; it being the intention of the
      parties that Tenant shall have a recurring termination option after each
      such period following the initial Recovery Deadline if Landlord does not
      have possession of the Premises by the end of each such period.

            (b) if Landlord does not tender to Tenant possession of the Premises
      with the Landlord Work Substantially Complete on or before the Sunset Date
      (defined below), Tenant shall have the option exercisable by giving
      written notice to Landlord within three (3) business days after the Sunset
      Date to terminate this Lease. If Tenant does not timely give notice of its
      election to terminate this Lease as aforesaid and if Landlord does not
      tender possession of the Premises with the Landlord Work Substantially
      Complete on or before the date which is thirty (30) days following the
      Sunset Date, then Tenant shall again have the option to terminate this
      Lease in the manner described above and such date shall constitute the new
      Sunset Date; it being the intention of the parties that Tenant shall have
      a recurring termination option after each such period following the
      initial Sunset Date if Landlord does not tender possession of the Premises
      with the Landlord Work Substantially Complete by the end of each such
      period. As used in this Lease, "Sunset Date" means the sixtieth (60th) day
      after the actual

                                       5
<PAGE>

      date Landlord regains possession of the space from the existing occupant,
      and the initial Sunset Date and any succeeding new Sunset Dates shall be
      extended by the number of days of delay due to Force Majeure plus the
      number of days of Tenant Delay, if any. On or before the Sunset Date, if
      such date includes any period of Force Majeure or Tenant Delay, Landlord
      shall give Tenant written notice of the resulting calendar date which is
      the Sunset Date.

2.04  AREA OF PREMISES

Landlord and Tenant agree that for all purposes of this Lease the Rentable Area
of the Premises and the Rentable Area of the Project as set forth in Article One
are controlling, and are not subject to revision after the date of this Lease.

2.05  CONDITION OF PREMISES

Tenant shall notify Landlord in writing within thirty (30) days after the later
of Substantial Completion of the Landlord Work or when Tenant takes possession
of the Premises of any defects in the Premises or in the materials or
workmanship furnished by Landlord in completing the Landlord Work. Except for
defects stated in such notice, Tenant shall be conclusively deemed to have
accepted the Premises "AS IS" in the condition existing on the date Tenant first
takes possession, and to have waived all claims relating to the condition of the
Premises. Landlord shall proceed diligently to correct the defects stated in
such notice unless Landlord disputes the existence of any such defects. In the
event of any dispute as to the existence of any such defects, the decision of
Landlord's architect shall be final and binding on the parties. No agreement of
Landlord to alter, remodel, decorate, clean or improve the Premises or the Real
Property and no representation regarding the condition of the Premises or the
Real Property has been made by or on behalf of Landlord to Tenant, except as may
be specifically stated in this Lease or in the Workletter.

2.06  PARKING

During the Term, Tenant may use the number of Parking Spaces specified in
Section 1.01(17) for parking on an unassigned basis at the prevailing rates. The
prevailing rates mean base rates being charged from time to time by Landlord or
its parking operator to other tenants for similar parking rights without
consideration of any discounts. The locations and type of parking shall be
designated by Landlord or Landlord's parking operator from time to time. Tenant
acknowledges and agrees that the parking spaces in the Project's parking
facility may include a mixture of spaces for compact vehicles as well as
full-size passenger automobiles, and that Tenant shall not use parking spaces
for vehicles larger than the striped size of the parking spaces. All vehicles
using Tenant's spaces shall prominently display identification stickers or other
markers, and/or have passes or keycards for ingress and egress, as may be
required and provided by Landlord or its parking operator from time to time.
Tenant shall comply with any and all parking rules and regulations from time to
time established by Landlord or Landlord's parking operator, including a
requirement that Tenant pay to Landlord or Landlord's parking operator a charge
for loss and replacement of passes, keycards, identification stickers or
markers, and for any and all loss or other damage caused by persons or vehicles
related to use of Tenant's parking privileges. Tenant shall not allow any
vehicles using Tenant's parking privileges to be parked, loaded or unloaded
except in accordance with this Section, including in the areas and in the manner
designated by Landlord or its parking operator for such activities. If any
vehicle is using the parking or loading areas contrary to any provision of this
Section, Landlord or its parking operator shall have the right, in addition to
all other rights and remedies of Landlord under this Lease, to remove or tow
away the vehicle without prior notice to Tenant, and the cost thereof shall be
paid to Landlord within ten (10) days after notice from Landlord to Tenant.

                                  ARTICLE THREE

                                      RENT

Tenant agrees to pay to Landlord at the first office specified in Section
1.01(2), or to such other persons, or at such other places designated by
Landlord, without any prior demand therefor in immediately available funds and
without any deduction or offset whatsoever, Rent, including Monthly Base Rent
and Rent Adjustments in accordance with Article Four, during the Term. Monthly
Base Rent shall be paid monthly in advance on the first day of each month of the
Term, except that the first installment of Monthly Base Rent shall be paid by
Tenant to Landlord concurrently with execution of this Lease. Monthly Base Rent
shall be prorated for partial months within the Term. Unpaid Rent shall bear
interest at the Default Rate from the date due until paid. Tenant's covenant to
pay Rent shall be independent of every other covenant in this Lease.

                                  ARTICLE FOUR

                          RENT ADJUSTMENTS AND PAYMENTS

4.01  RENT ADJUSTMENTS

Tenant shall pay to Landlord Rent Adjustments with respect to each Adjustment
Year as follows:

            (i) The Rent Adjustment Deposit representing Tenant's Share of
      Operating Expenses for the applicable Adjustment Year in excess of
      Operating Expenses for the Operating Expenses Base Year, monthly during
      the Term with the payment of Monthly Base Rent; and

            (ii) The Rent Adjustment Deposit representing Tenant's Share of
      Taxes for the applicable Adjustment Year in excess of Taxes for the Taxes
      Base Year, monthly during the Term with the payment of Monthly Base Rent;
      and

            (iii) Any Rent Adjustments due in excess of the Rent Adjustment
      Deposits in accordance with Section 4.02. Rent Adjustments due from Tenant
      to Landlord for any Adjustment Year shall be Tenant's

                                       6
<PAGE>

      Share of Operating Expenses for such year in excess of Operating Expenses
      for the Operating Expenses Base Year and Tenant's Share of Taxes for such
      year in excess of Taxes for the Taxes Base Year.

4.02  STATEMENT OF LANDLORD

As soon as feasible after the expiration of the Operating Expenses Base Year and
the Taxes Base Year, and each Adjustment Year thereafter, Landlord will furnish
Tenant a statement ("Landlord's Statement") showing the following:

            (i) Operating Expenses and Taxes for the Operating Expenses Base
      Year and Taxes Base Year and thereafter for the last Adjustment Year;

            (ii) The amount of Rent Adjustments due Landlord for the last
      Adjustment Year, less credit for Rent Adjustment Deposits paid, if any;
      and

            (iii) Any change in the Rent Adjustment Deposit due monthly in the
      current Adjustment Year, including the amount or revised amount due for
      months preceding any such change pursuant to Landlord's Statement.

Tenant shall pay to Landlord within ten (10) days after receipt of such
statement any amounts for Rent Adjustments then due in accordance with
Landlord's Statement. Any amounts due from Landlord to Tenant pursuant to this
Section shall be credited to the Rent Adjustment Deposit next coming due, or
refunded to Tenant if the Term has already expired provided Tenant is not in
default hereunder. No interest or penalties shall accrue on any amounts which
Landlord is obligated to credit or refund to Tenant by reason of this Section
4.02. Landlord's failure to deliver Landlord's Statement or to compute the
amount of the Rent Adjustments shall not constitute a waiver by Landlord of its
right to deliver such items nor constitute a waiver or release of Tenant's
obligations to pay such amounts. The Rent Adjustment Deposit shall be credited
against Rent Adjustments due for the applicable Adjustment Year. During the last
complete calendar year or during any partial calendar year in which the Lease
terminates, Landlord may include in the Rent Adjustment Deposit its estimate of
Rent Adjustments which may not be finally determined until after the termination
of this Lease. Tenant's obligation to pay Rent Adjustments survives the
expiration or termination of the Lease. Notwithstanding the foregoing, in no
event shall the sum of Monthly Base Rent and the Rent Adjustments be less than
the Monthly Base Rent payable.

4.03  BOOKS AND RECORDS

Landlord shall maintain books and records showing Operating Expenses and Taxes
in accordance with sound accounting and management practices, consistently
applied. The Tenant or its representative (which representative shall be a
certified public accountant licensed to do business in the state in which the
Property is located and whose primary business is certified public accounting)
shall have the right, for a period of thirty (30) days following the date upon
which Landlord's Statement is delivered to Tenant, to examine the Landlord's
books and records with respect to the items in the foregoing statement of
Operating Expenses and Taxes during normal business hours, upon written notice,
delivered at least three (3) business days in advance. If Tenant does not object
in writing to Landlord's Statement within sixty (60) days of Tenant's receipt
thereof, specifying the nature of the item in dispute and the reasons therefor,
then Landlord's Statement shall be considered final and accepted by Tenant. Any
amount due to the Landlord as shown on Landlord's Statement, whether or not
disputed by Tenant as provided herein shall be paid by Tenant when due as
provided above, without prejudice to any such written exception.

4.04  PARTIAL OCCUPANCY

For purposes of determining Rent Adjustments, if the Building is not fully
occupied during all or a portion of any year during the Term, Landlord may make
appropriate adjustments to the Operating Expenses for such year employing sound
accounting and management principles consistently applied, to determine the
amount of Operating Expenses that would have been paid or incurred by Landlord
had the Building been 100% occupied, and the amount so determined shall be
deemed to have been the amount of Operating Expenses for such year. In the event
that the Real Property is not fully assessed for all or a portion of any year
during the Term, then Taxes shall be adjusted to an amount which would have been
payable in such year if the Real Property had been fully assessed. In the event
any other tenant in the Building provides itself with a service of a type which
Landlord would supply under the Lease without an additional or separate charge
to Tenant, then Operating Expenses shall be deemed to include the cost Landlord
would have incurred had Landlord provided such service to such other tenant.

4.05  TENANT OR LEASE SPECIFIC TAXES

In addition to Monthly Base Rent, Rent Adjustments, Rent Adjustment Deposits and
other charges to be paid by Tenant, Tenant shall pay to Landlord, upon demand,
any and all taxes payable by Landlord (other than federal or state inheritance,
general income, gift or estate taxes) whether or not now customary or within the
contemplation of the parties hereto: (a) upon, allocable to, or measured by the
Rent payable hereunder, including any gross receipts tax or excise tax levied by
any governmental or taxing body with respect to the receipt of such rent; or (b)
upon or with respect to the possession, leasing, operation, management,
maintenance, alteration, repair, use or occupancy by Tenant of the Premises or
any portion thereof; or (c) upon the measured value of Tenant's personal
property located in the Premises or in any storeroom or any other place in the
Premises or the Property, or the areas used in connection with the operation of
the Property, it being the intention of Landlord and Tenant that, to the extent
possible, such personal property taxes shall be billed to and paid directly by
Tenant; (d) resulting from Landlord Work, Tenant Work or Tenant Alterations to
the Premises, whether title thereto is in Landlord or Tenant; or (e) upon this
transaction. Taxes paid by Tenant pursuant to this Section 4.05 shall not be
included in any computation of Taxes payable pursuant to Sections 4.01 and 4.02.

                                       7
<PAGE>

                                  ARTICLE FIVE
                                SECURITY DEPOSIT

Tenant concurrently with the execution of this Lease shall pay to Landlord in
immediately available funds the Security Deposit. The Security Deposit may be
applied by Landlord to cure, in whole or part, any default of Tenant under this
Lease, and upon notice by Landlord of such application, Tenant shall replenish
the Security Deposit in full by paying to Landlord within ten (10) days of
demand the amount so applied. Landlord's application of the Security Deposit
shall not constitute a waiver of Tenant's default to the extent that the
Security Deposit does not fully compensate Landlord for all losses, damages,
costs and expenses incurred by Landlord in connection with such default and
shall not prejudice any other rights or remedies available to Landlord under
this Lease or by Law. Landlord shall not pay any interest on the Security
Deposit. Landlord shall not be required to keep the Security Deposit separate
from its general accounts. The Security Deposit shall not be deemed an advance
payment of Rent, nor a measure of damages for any default by Tenant under this
Lease, nor shall it be a bar or defense of any action which Landlord may at any
time commence against Tenant. In the absence of evidence satisfactory to
Landlord of an assignment of the right to receive the Security Deposit or the
remaining balance thereof, Landlord may return the Security Deposit to the
original Tenant, regardless of one or more assignments of this Lease. Upon the
transfer of Landlord's interest under this Lease, Landlord's obligation to
Tenant with respect to the Security Deposit shall terminate upon transfer to the
transferee of the Security Deposit, or any balance thereof. If Tenant shall
fully and faithfully comply with all the terms, provisions, covenants, and
conditions of this Lease, the Security Deposit, or any balance thereof, shall be
returned to Tenant within thirty (30) days after Landlord recovers possession of
the Premises or such longer time as may be permissible under Law. Tenant hereby
waives any and all rights of Tenant under the provisions of Section 1950.7 of
the California Civil Code or other Law regarding security deposits.

                                   ARTICLE SIX
                                    SERVICES

6.01  LANDLORD'S GENERAL SERVICES

      (a) So long as the Lease is in full force and effect and Tenant has paid
all Rent then due, Landlord shall furnish the following services:

(1)   heat, ventilation and air-conditioning ("HVAC") in the Premises during
      Standard Operating Hours, as necessary in Landlord's reasonable judgment
      for the comfortable occupancy of the Premises under normal business
      operations, subject to compliance with all applicable voluntary and
      mandatory regulations and Laws;

(2)   tempered and cold water for use in lavatories in common with other tenants
      from the regular supply of the Building;

(3)   customary cleaning and janitorial services in the Premises five (5) days
      per week, excluding National Holidays;

(4)   washing of the outside windows in the Premises weather permitting at
      intervals determined by Landlord;

(5)   automatic passenger elevator service in common with other tenants of the
      Building and freight elevator service subject to reasonable scheduling by
      Landlord and payment of Landlord's standard charges;

      (b) If Tenant uses heat generating machines or equipment in the Premises
to an extent which adversely affects the temperature otherwise maintained by the
air-cooling system or whenever the occupancy or electrical load adversely
affects the temperature otherwise maintained by the air-cooling system, Landlord
reserves the right to install or to require Tenant to install supplementary
air-conditioning units in the Premises. Tenant shall bear all costs and expenses
related to the installation, maintenance and operation of such units.

      (c) Tenant shall pay Landlord at rates fixed by Landlord for all tenants
in the Building, charges for all water furnished to the Premises, including the
expenses of installation of a water line, meter and fixtures.

6.02  ELECTRICAL SERVICES

      (a) So long as the Lease is in full force and effect and Tenant has paid
all Rent then due, Landlord shall furnish to the Premises electric current for
general business office use, including normal lighting, normal business office
machines, customary janitorial service, and making alterations or repairs
(whether by Landlord or Tenant). Notwithstanding any provision of the Lease to
the contrary, without, in each instance, the prior written consent of Landlord,
which may be withheld in Landlord's sole discretion, Tenant shall not: (i) make
any alterations or additions to the electric equipment or systems; or (ii)
install or use or permit the installation or use of any computer or electronic
data processing equipment in the Premises other than personal computers, lap-top
computers and ancillary equipment. Tenant's use of electric current shall at no
time exceed the capacity of the wiring, feeders and risers providing electric
current to the Premises or the Building. The consent of Landlord to the
installation of electric equipment shall not relieve Tenant from the obligation
to limit usage of electricity to no more than such capacity.

      (b) If and to the extent electric current is furnished to the Premises in
excess of the amount of electric current normally used during Standard Operating
Hours in a general business office in a first class office building with the
type of electrical equipment and normal business office machines described in
subparagraph (a) above, Tenant shall pay Landlord upon notice from Landlord the
cost of such excess electric current, as additional Rent. The cost of such
excess use and all additional costs separately billed to Tenant pursuant to this
Section shall not be included as part of Operating Expenses. At any time and
from time to time, Landlord may in its sole discretion either (i) install one or
more meters to measure electric current furnished to the Premises or (ii)
reasonably estimate electric current furnished

                                       8
<PAGE>

to the Premises. Upon notice from Landlord, Tenant shall pay Landlord the cost
of installing and maintaining all such meters and of any electrical engineering
or consulting firm, if Landlord retains such firm to estimate the electric
current furnished to the Premises in lieu of installation of a meter. Tenant
shall pay Landlord for such excess electric current at the then current rates
charged to Landlord for such electricity provided to the Property by the utility
provider chosen by Landlord plus any additional cost of Landlord in keeping
account of the electric current so consumed. Landlord's notice shall specify
whether such excess use shall be payable (i) in advance as reasonably estimated
by Landlord in monthly installments at the time prescribed for monthly
installments of Monthly Base Rent or (ii) within ten days after notice from
Landlord given from time to time of the amount due for prior excess use as
metered or reasonably estimated by Landlord.

      (c) So long as the Lease is in full force and effect and Tenant has paid
all Rent then due, Landlord shall furnish to the Premises replacement lamps,
bulbs, ballasts and starters used in any normal Building lighting installed in
the Premises, except that if the replacement or repair of such items is a result
of negligence of Tenant, its employees, agents, servants, licensees, subtenants,
contractors or invitees, such cost shall be paid by Tenant within ten days after
notice from Landlord and shall not be included as part of Operating Expenses.

6.03  ADDITIONAL AND AFTER-HOUR SERVICES

At Tenant's written request, Landlord shall furnish additional quantities of any
of the services or utilities specified in Section 6.01, if Landlord can
reasonably do so, on the terms set forth herein. For HVAC: (a) for service after
Standard Operating Hours on Monday through Friday, excluding National Holidays,
Tenant shall deliver to Landlord a written request before 10:00 A.M. of such
day, and (b) for service on a Sunday, National Holiday or beyond Standard
Operating Hours on a Saturday, Tenant shall deliver to Landlord a written
request before 10:00 A.M. of the last business day before the requested service.
For services or utilities requested by Tenant and furnished by Landlord, Tenant
shall pay to Landlord as a charge therefor Landlord's prevailing rates charged
from time to time for such services and utilities. For HVAC service beyond
Standard Operating Hours, as of the date of this Lease, Landlord's prevailing
rate is Seventy-five Dollars ($75.00) per hour, subject to a two (2) hour
minimum per activation. If Tenant shall fail to make any such payment, Landlord
may, upon notice to Tenant and in addition to Landlord's other remedies under
this Lease, discontinue any or all of such additional services.

6.04  TELEPHONE SERVICES

All telegraph, telephone, and communication connections which Tenant may desire
shall be subject to Landlord's prior written approval, in Landlord's sole
discretion, and the location of all wires and the work in connection therewith
shall be performed by contractors approved by Landlord and shall be subject to
the direction of Landlord, except that such approval is not required as to
Tenant's telephone equipment (including cabling) within the Premises and from
the Premises in a route designated by Landlord to any telephone cabinet or panel
provided (as existing or as installed as part of Landlord's Work, if any) on
Tenant's floor for Tenant's connection to the telephone cable serving the
Building, so long as Tenant's equipment does not require connections different
than or additional to those to the telephone cabinet or panel provided. Except
to the extent of such cabling within the Premises or from the Premises to such
telephone cabinet or panel, Landlord reserves the right to designate and control
the entity or entities providing telephone or other communication cable
installation, removal, repair and maintenance in the Building and to restrict
and control access to telephone cabinets or panels. In the event Landlord
designates a particular vendor or vendors to provide such cable installation,
removal, repair and maintenance for the Building, Tenant agrees to abide by and
participate in such program. Tenant shall be responsible for and shall pay all
costs incurred in connection with the installation of telephone cables and
communication wiring in the Premises, including any hook-up, access and
maintenance fees related to the installation of such wires and cables in the
Premises and the commencement of service therein, and the maintenance thereafter
of such wire and cables; and there shall be included in Operating Expenses for
the Building all installation, removal, hook-up or maintenance costs incurred by
Landlord in connection with telephone cables and communication wiring serving
the Building which are not allocable to any individual users of such service but
are allocable to the Building generally. If Tenant fails to maintain all
telephone cables and communication wiring in the Premises and such failure
affects or interferes with the operation or maintenance of any other telephone
cables or communication wiring serving the Building, Landlord or any vendor
hired by Landlord may enter into and upon the Premises forthwith and perform
such repairs, restorations or alterations as Landlord deems necessary in order
to eliminate any such interference (and Landlord may recover from Tenant all of
Landlord's costs in connection therewith). No later than the Termination Date,
Tenant agrees to remove all telephone cables and communication wiring installed
by Tenant for and during Tenant's occupancy, which Landlord shall request Tenant
to remove. Tenant agrees that neither Landlord nor any of its agents or
employees shall be liable to Tenant, or any of Tenant's employees, agents,
customers or invitees or anyone claiming through, by or under Tenant, for any
damages, injuries, losses, expenses, claims or causes of action because of any
interruption, diminution, delay or discontinuance at any time for any reason in
the furnishing of any telephone or other communication service to the Premises
and the Building.

6.05  DELAYS IN FURNISHING SERVICES

Tenant agrees that Landlord shall not be in breach of this Lease nor be liable
to Tenant for damages or otherwise, for any failure to furnish, or a delay in
furnishing, or a change in the quantity or character of any service when such
failure, delay or change is occasioned, in whole or in part, by repairs,
improvements or mechanical breakdowns by the act or default of Tenant or other
parties or by an event of Force Majeure. No such failure, delay or change shall
be deemed to be an eviction or disturbance of Tenant's use and possession of the
Premises, or relieve Tenant from paying Rent or from performing any other
obligations of Tenant under this Lease, without any deduction or offset. Failure
to any extent to make available, or any slowdown, stoppage, or interruption of,
the specified utility services resulting from any cause, including changes in
service provider or Landlord's compliance with any voluntary or similar
governmental or business guidelines now or hereafter published or any
requirements now or hereafter established by any governmental agency, board, or
bureau having jurisdiction over the operation of the Property, shall not render
Landlord liable in any respect for damages to either persons, property, or
business, nor be construed as an eviction of Tenant or work an

                                       9
<PAGE>

abatement of Rent, nor relieve Tenant of Tenant's obligations for fulfillment of
any covenant or agreement hereof. Should any equipment or machinery furnished by
Landlord break down or for any cause cease to function properly, Landlord shall
use reasonable diligence to repair same promptly, but Tenant shall have no claim
for abatement of Rent or damages on account of any interruption of service
occasioned thereby or resulting therefrom.

6.06  CHOICE OF SERVICE PROVIDER

Tenant acknowledges that Landlord may, at Landlord's sole option, to the extent
permitted by applicable law, elect to change, from time to time, the company or
companies which provide services (including electrical service, gas service,
water, telephone and technical services) to the Property, the Premises and/or
its occupants. Notwithstanding anything to the contrary set forth in this Lease,
Tenant acknowledges that Landlord has not and does not make any representations
or warranties concerning the identity or identities of the company or companies
which provide services to the Property and the Premises or its occupants and
Tenant acknowledges that the choice of service providers and matters concerning
the engagement and termination thereof shall be solely that of Landlord. The
foregoing provision is not intended to modify, amend, change or otherwise
derogate any provision of this Lease concerning the nature or type of service to
be provided or any specific information concerning the amount thereof to be
provided. Tenant agrees to cooperate with Landlord and each of its service
providers in connection with any change in service or provider.

6.07  SIGNAGE

Initial Building standard signage will be installed by Landlord in the directory
in the main lobby of the Building, in the listing of tenants in the elevator
lobby for the floor on which the Premises is located and at Tenant's main entry
door to the Premises at Tenant's sole cost and expense except to the extent that
funds are available out of any Landlord's Maximum Contribution, if any, provided
pursuant to the Workletter. A form will be provided for completion by Tenant for
Building standard signage. A sample of the Building standard signage will be
provided by Landlord. Any change in such initial signage shall be only with
Landlord's prior written consent, shall conform to Building standard signage and
shall be at Tenant's sole cost and expense.

                                  ARTICLE SEVEN
                    POSSESSION, USE AND CONDITION OF PREMISES

7.01  POSSESSION AND USE OF PREMISES

      (a) Tenant shall be entitled to possession of the Premises when the
Landlord Work is Substantially Complete. Tenant shall occupy and use the
Premises only for the uses specified in Section 1.01(16) to conduct Tenant's
business. Tenant shall not occupy or use the Premises (or permit the use or
occupancy of the Premises) for any purpose or in any manner which: (1) is
unlawful or in violation of any Law or Environmental Law; (2) may be dangerous
to persons or property or which may increase the cost of, or invalidate, any
policy of insurance carried on the Building or covering its operations; (3) is
contrary to or prohibited by the terms and conditions of this Lease or the rules
of the Building set forth in Article Eighteen; or (4) would tend to create or
continue a nuisance.

      (b) Tenant shall comply with all Environmental Laws pertaining to Tenant's
occupancy and use of the Premises and concerning the proper storage, handling
and disposal of any Hazardous Material introduced to the Premises, the Building
or the Property by Tenant or other occupants of the Premises, or their
employees, servants, agents, contractors, customers or invitees. Landlord shall
comply with all Environmental Laws applicable to the Property other than those
to be complied with by Tenant pursuant to the preceding sentence. Tenant shall
not generate, store, handle or dispose of any Hazardous Material in, on, or
about the Property without the prior written consent of Landlord, which may be
withheld in Landlord's sole discretion, except that such consent shall not be
required to the extent of Hazardous Material packaged and contained in office
products for consumer use in general business offices in quantities for ordinary
day-to-day use provided such use does not give rise to, or pose a risk of,
exposure to or release of Hazardous Material. In the event that Tenant is
notified of any investigation or violation of any Environmental Law arising from
Tenant's activities at the Premises, Tenant shall immediately deliver to
Landlord a copy of such notice. In such event or in the event Landlord
reasonably believes that a violation of Environmental Law exists, Landlord may
conduct such tests and studies relating to compliance by Tenant with
Environmental Laws or the alleged presence of Hazardous Material upon the
Premises as Landlord deems desirable, all of which shall be completed at
Tenant's expense. Landlord's inspection and testing rights are for Landlord's
own protection only, and Landlord has not, and shall not be deemed to have
assumed any responsibility to Tenant or any other party for compliance with
Environmental Laws, as a result of the exercise, or non-exercise of such rights.
Tenant hereby indemnifies, and agrees to defend, protect and hold harmless, the
Indemnitees from any and all loss, claim, demand, action, expense, liability and
cost (including attorneys' fees and expenses) arising out of or in any way
related to the presence of any Hazardous Material introduced to the Premises or
Property during the Lease Term by Tenant or other occupants of the Premises, or
their employees, servants, agents, contractors, customers or invitees. In case
of any action or proceeding brought against the Indemnitees by reason of any
such claim, upon notice from Landlord, Tenant covenants to defend such action or
proceeding by counsel chosen by Landlord, in Landlord's sole discretion.
Landlord reserves the right to settle, compromise or dispose of any and all
actions, claims and demands related to the foregoing indemnity. If any Hazardous
Material is released, discharged or disposed of on or about the Property and
such release, discharge or disposal is not caused by Tenant or other occupants
of the Premises, or their employees, servants, agents, contractors customers or
invitees, such release, discharge or disposal shall be deemed casualty damage
under Article Fourteen to the extent that the Premises are affected thereby; in
such case, Landlord and Tenant shall have the obligations and rights respecting
such casualty damage provided under such Article.

      (c) Landlord and Tenant acknowledge that the Americans With Disabilities
Act of 1990 (42 U.S.C. ss.12101 et seq.) and regulations and guidelines
promulgated thereunder, as all of the same may be amended and supplemented from
time to time (collectively referred to herein as the "ADA") establish
requirements for business operations, accessibility and barrier removal, and
that such requirements may or may not apply to the Premises, the

                                       10
<PAGE>

Building and the Project depending on, among other things: (1) whether Tenant's
business is deemed a "public accommodation" or "commercial facility", (2)
whether such requirements are "readily achievable", and (3) whether a given
alteration affects a "primary function area" or triggers "path of travel"
requirements. The parties hereby agree that: (a) Landlord shall be responsible
for ADA Title III compliance in the Common Areas, except as provided below, (b)
Tenant shall be responsible for ADA Title III compliance in the Premises,
including any leasehold improvements or other work to be performed in the
Premises under or in connection with this Lease, (c) Landlord may perform, or
require that Tenant perform, and Tenant shall be responsible for the cost of,
ADA Title III "path of travel" requirements triggered by Tenant Additions in the
Premises, and (d) Landlord may perform, or require Tenant to perform, and Tenant
shall be responsible for the cost of, ADA Title III compliance in the Common
Areas necessitated by the Building being deemed to be a "public accommodation"
instead of a "commercial facility" as a result of Tenant's use of the Premises.
Tenant shall be solely responsible for requirements under Title I of the ADA
relating to Tenant's employees.

      (d) Landlord and Tenant agree to cooperate and use commercially reasonable
efforts to participate in traffic management programs generally applicable to
businesses located in or about the area and Tenant shall encourage and support
van and car pooling by, and staggered and flexible working hours for, its office
workers and service employees to the extent reasonably permitted by the
requirements of Tenant's business. Neither this Section or any other provision
of this Lease is intended to or shall create any rights or benefits in any other
person, firm, company, governmental entity or the public.

      (e) Tenant agrees to cooperate with Landlord and to comply with any and
all guidelines or controls concerning energy management imposed upon Landlord by
federal or state governmental organizations or by any energy conservation
association to which Landlord is a party or which is applicable to the Building.

7.02  LANDLORD ACCESS TO PREMISES; APPROVALS

      (a) Tenant shall permit Landlord to erect, use and maintain pipes, ducts,
wiring and conduits in and through the Premises, so long as Tenant's use, layout
or design of the Premises is not materially affected or altered. Landlord or
Landlord's agents shall have the right to enter upon the Premises in the event
of an emergency, or upon forty-eight (48) hours prior written notice (except for
regular janitorial or cleaning services) to inspect the Premises, to perform
janitorial and other services, to conduct safety and other testing in the
Premises and to make such repairs, alterations, improvements or additions to the
Premises or the Building or other parts of the Property as Landlord may deem
necessary or desirable (including all alterations, improvements and additions in
connection with a change in service provider or providers). Janitorial and
cleaning services shall be performed after normal business hours. Any entry or
work by Landlord may be during normal business hours and Landlord may use
reasonable efforts to ensure that any entry or work shall not materially
interfere with Tenant's occupancy of the Premises.

      (b) If Tenant shall not be personally present to permit an entry into the
Premises when for any reason an entry therein shall be necessary or permissible,
Landlord (or Landlord's agents), after notifying Tenant as set forth above
(unless Landlord believes an emergency situation exists), may enter the Premises
without rendering Landlord or its agents liable therefor, and without relieving
Tenant of any obligations under this Lease.

      (c) Landlord may enter the Premises for the purpose of conducting such
inspections, tests and studies as Landlord may deem desirable or necessary to
confirm Tenant's compliance with all Laws and Environmental Laws or for other
purposes necessary in Landlord's reasonable judgment to ensure the sound
condition of the Property and the systems serving the Property. Landlord's
rights under this Section 7.02(c) are for Landlord's own protection only, and
Landlord has not, and shall not be deemed to have assumed, any responsibility to
Tenant or any other party as a result of the exercise or non-exercise of such
rights, for compliance with Laws or Environmental Laws or for the accuracy or
sufficiency of any item or the quality or suitability of any item for its
intended use.

      (d) Landlord may do any of the foregoing, or undertake any of the
inspection or work described in the preceding paragraphs without such action
constituting an actual or constructive eviction of Tenant, in whole or in part,
or giving rise to an abatement of Rent by reason of loss or interruption of
business of the Tenant, or otherwise.

      (e) The review, approval or consent of Landlord with respect to any item
required or permitted under this Lease is for Landlord's own protection only,
and Landlord has not, and shall not be deemed to have assumed, any
responsibility to Tenant or any other party, as a result of the exercise or
non-exercise of such rights, for compliance with Laws or Environmental Laws or
for the accuracy or sufficiency of any item or the quality or suitability of any
item for its intended use.

7.03  QUIET ENJOYMENT

Landlord covenants, in lieu of any implied covenant of quiet possession or quiet
enjoyment, that so long as Tenant is in compliance with the covenants and
conditions set forth in this Lease, Tenant shall have the right to quiet
enjoyment of the Premises without hindrance or interference from Landlord or
those claiming through Landlord, and subject to the covenants and conditions set
forth in the Lease and to the rights of any Mortgagee or ground lessor.

                                  ARTICLE EIGHT
                                   MAINTENANCE

8.01  LANDLORD'S MAINTENANCE

Subject to the provisions of Article Fourteen, Landlord shall maintain and make
necessary repairs to the foundations, roofs, exterior walls, and the structural
elements of the Building, the electrical, plumbing, heating, ventilating,
air-conditioning, mechanical, communication, security and the fire and life
safety systems of the Building and those

                                       11
<PAGE>

corridors, washrooms and lobbies which are Common Areas of the Building, except
that: (a) Landlord shall not be responsible for the maintenance or repair of any
floor or wall coverings in the Premises or any of such systems which are located
within the Premises and are supplemental or special to the Building's standard
systems; and (b) the cost of performing any of said maintenance or repairs
whether to the Premises or to the Building caused by the negligence of Tenant,
its employees, agents, servants, licensees, subtenants, contractors or invitees,
shall be paid by Tenant, subject to the waivers set forth in Section 16.04.
Landlord shall not be liable to Tenant for any expense, injury, loss or damage
resulting from work done in or upon, or in connection with the use of, any
adjacent or nearby building, land, street or alley.

8.02  TENANT'S MAINTENANCE

Subject to the provisions of Article Fourteen, Tenant, at its expense, shall
keep and maintain the Premises and all Tenant Additions in good order, condition
and repair and in accordance with all Laws and Environmental Laws. Tenant shall
not permit waste and shall promptly and adequately repair all damages to the
Premises and replace or repair all damaged or broken glass in the interior of
the Premises, fixtures or appurtenances. Any repairs or maintenance shall be
completed with materials of similar quality to the original materials, all such
work to be completed under the supervision of Landlord. Any such repairs or
maintenance shall be performed only by contractors or mechanics approved by
Landlord, which approval shall not be unreasonably withheld, and whose work will
not cause or threaten to cause disharmony or interference with Landlord or other
tenants in the Building and their respective agents and contractors performing
work in or about the Building. If Tenant fails to perform any of its obligations
set forth in this Section 8.02, Landlord may, in its sole discretion and upon 24
hours prior notice to Tenant (except without notice in the case of emergencies),
perform the same, and Tenant shall pay to Landlord any costs or expenses
incurred by Landlord upon demand.

                                  ARTICLE NINE
                          ALTERATIONS AND IMPROVEMENTS

9.01  TENANT ALTERATIONS

      (a) The following provisions shall apply to the completion of any Tenant
Alterations:

(1)   Tenant shall not, except as provided herein, without the prior written
      consent of Landlord, which consent shall not be unreasonably withheld,
      make or cause to be made any Tenant Alterations in or to the Premises or
      any Property systems serving the Premises. Prior to making any Tenant
      Alterations, Tenant shall give Landlord ten (10) days prior written notice
      (or such earlier notice as would be necessary pursuant to applicable Law)
      to permit Landlord sufficient time to post appropriate notices of
      non-responsibility. Subject to all other requirements of this Article
      Nine, Tenant may undertake Decoration work without Landlord's prior
      written consent. Tenant shall furnish Landlord with the names and
      addresses of all contractors and subcontractors and copies of all
      contracts. All Tenant Alterations shall be completed at such time and in
      such manner as Landlord may from time to time designate, and only by
      contractors or mechanics approved by Landlord, which approval shall not be
      unreasonably withheld, provided, however, that Landlord may, in its sole
      discretion, specify the engineers and contractors to perform all work
      relating to the Building's systems (including the mechanical, heating,
      plumbing, security, ventilating, air-conditioning, electrical,
      communication and the fire and life safety systems in the Building). The
      contractors, mechanics and engineers who may be used are further limited
      to those whose work will not cause or threaten to cause disharmony or
      interference with Landlord or other tenants in the Building and their
      respective agents and contractors performing work in or about the
      Building. Landlord may further condition its consent upon Tenant
      furnishing to Landlord and Landlord approving prior to the commencement of
      any work or delivery of materials to the Premises related to the Tenant
      Alterations such of the following as specified by Landlord: architectural
      plans and specifications, opinions from Landlord's engineers stating that
      the Tenant Alterations will not in any way adversely affect the Building's
      systems, necessary permits and licenses, certificates of insurance, and
      such other documents in such form reasonably requested by Landlord.
      Landlord may, in the exercise of reasonable judgment, request that Tenant
      provide Landlord with appropriate evidence of Tenant's ability to complete
      and pay for the completion of the Tenant Alterations such as a performance
      bond or letter of credit. Upon completion of the Tenant Alterations,
      Tenant shall deliver to Landlord an as-built mylar and digitized (if
      available) set of plans and specifications for the Tenant Alterations.

(2)   Tenant shall pay the cost of all Tenant Alterations and the cost of
      decorating the Premises and any work to the Property occasioned thereby.
      In connection with completion of any Tenant Alterations, Tenant shall pay
      Landlord a construction fee and all elevator and hoisting charges at
      Landlord's then standard rate. Upon completion of Tenant Alterations,
      Tenant shall furnish Landlord with contractors' affidavits and full and
      final waivers of lien and receipted bills covering all labor and materials
      expended and used in connection therewith and such other documentation
      reasonably requested by Landlord or Mortgagee.

(3)   Tenant agrees to complete all Tenant Alterations (i) in accordance with
      all Laws, Environmental Laws, all requirements of applicable insurance
      companies and in accordance with Landlord's standard construction rules
      and regulations, and (ii) in a good and workmanlike manner with the use of
      good grades of materials. Tenant shall notify Landlord immediately if
      Tenant receives any notice of violation of any Law in connection with
      completion of any Tenant Alterations and shall immediately take such steps
      as are necessary to remedy such violation. In no event shall such
      supervision or right to supervise by Landlord nor shall any approvals
      given by Landlord under this Lease constitute any warranty by Landlord to
      Tenant of the adequacy of the design, workmanship or quality of such work
      or materials for Tenant's intended use or of compliance with the
      requirements of Section 9.01(a)(3)(i) and (ii) above or impose any
      liability upon Landlord in connection with the performance of such work.

                                       12
<PAGE>

      (b) All Tenant Additions whether installed by Landlord or Tenant, shall
without compensation or credit to Tenant, become part of the Premises and the
property of Landlord at the time of their installation and shall remain in the
Premises, unless pursuant to Article Twelve, Tenant may remove them or is
required to remove them at Landlord's request.

9.02  LIENS

Tenant shall not permit any lien or claim for lien of any mechanic, laborer or
supplier or any other lien to be filed against the Building, the Land, the
Premises, or any other part of the Property arising out of work performed, or
alleged to have been performed by, or at the direction of, or on behalf of
Tenant. If any such lien or claim for lien is filed, Tenant shall within ten
(10) days of receiving notice of such lien or claim (a) have such lien or claim
for lien released of record or (b) deliver to Landlord a bond in form, content,
amount, and issued by surety, satisfactory to Landlord, indemnifying,
protecting, defending and holding harmless the Indemnitees against all costs and
liabilities resulting from such lien or claim for lien and the foreclosure or
attempted foreclosure thereof. If Tenant fails to take any of the above actions,
Landlord, in addition to its rights and remedies under Article Eleven, without
investigating the validity of such lien or claim for lien, may pay or discharge
the same and Tenant shall, as payment of additional Rent hereunder, reimburse
Landlord upon demand for the amount so paid by Landlord, including Landlord's
expenses and attorneys' fees.

                                   ARTICLE TEN
                            ASSIGNMENT AND SUBLETTING

10.01 ASSIGNMENT AND SUBLETTING

      (a) Without the prior written consent of Landlord, which may be withheld
in Landlord's sole discretion, Tenant may not sublease, assign, mortgage,
pledge, hypothecate or otherwise transfer or permit the transfer of this Lease
or the encumbering of Tenant's interest therein in whole or in part, by
operation of Law or otherwise or permit the use or occupancy of the Premises, or
any part thereof, by anyone other than Tenant, provided, however, if Landlord
chooses not to recapture the space proposed to be subleased or assigned as
provided in Section 10.02, Landlord shall not unreasonably withhold its consent
to a subletting or assignment under this Section 10.01. Tenant agrees that the
provisions governing sublease and assignment set forth in this Article Ten shall
be deemed to be reasonable. If Tenant desires to enter into any sublease of the
Premises or assignment of this Lease, Tenant shall deliver written notice
thereof to Landlord ("Tenant's Notice"), together with the identity of the
proposed subtenant or assignee and the proposed principal terms thereof and
financial and other information sufficient for Landlord to make an informed
judgment with respect to such proposed subtenant or assignee at least sixty (60)
days prior to the commencement date of the term of the proposed sublease or
assignment. If Tenant proposes to sublease less than all of the Rentable Area of
the Premises, the space proposed to be sublet and the space retained by Tenant
must each be a marketable unit as reasonably determined by Landlord and
otherwise in compliance with all Laws. Landlord shall notify Tenant in writing
of its approval or disapproval of the proposed sublease or assignment or its
decision to exercise its rights under Section 10.02 within thirty (30) days
after receipt of Tenant's Notice (and all required information). In no event may
Tenant sublease any portion of the Premises or assign the Lease to any other
tenant of the Project. Tenant shall submit for Landlord's approval (which
approval shall not be unreasonably withheld) any advertising which Tenant or its
agents intend to use with respect to the space proposed to be sublet.

      (b) With respect to Landlord's consent to an assignment or sublease,
Landlord may take into consideration any factors which Landlord may deem
relevant, and the reasons for which Landlord's denial shall be deemed to be
reasonable shall include, without limitation, the following:

      (i) the business reputation or creditworthiness of any proposed subtenant
      or assignee is not acceptable to Landlord; or

      (ii) in Landlord's reasonable judgment the proposed assignee or subtenant
      would diminish the value or reputation of the Building or Landlord; or

      (iii) any proposed assignee's or subtenant's use of the Premises would
      violate Section 7.01 of the Lease or would violate the provisions of any
      other leases of tenants in the Project;

      (iv) the proposed assignee or subtenant is either a governmental agency, a
      school or similar operation, or a medical related practice; or

      (v) the proposed subtenant or assignee is a bona fide prospective tenant
      of Landlord in the Project as demonstrated by a written proposal dated
      within ninety (90) days prior to the date of Tenant's request; or

      (vi) the proposed subtenant or assignee would materially increase the
      estimated pedestrian and vehicular traffic to and from the Premises and
      the Building.

In no event shall Landlord be obligated to consider a consent to any proposed
assignment of the Lease which would assign less than the entire Premises. In the
event Landlord wrongfully withholds its consent to any proposed sublease of the
Premises or assignment of the Lease, Tenant's sole and exclusive remedy therefor
shall be to seek specific performance of Landlord's obligations to consent to
such sublease or assignment.

      (c) Any sublease or assignment shall be expressly subject to the terms and
conditions of this Lease. Any subtenant or assignee shall execute such documents
as Landlord may reasonably require to evidence such subtenant or assignee's
assumption of the obligations and liabilities of Tenant under this Lease. Tenant
shall deliver to Landlord a copy of all agreements executed by Tenant and the
proposed subtenant and assignee with respect to the Premises.

                                       13
<PAGE>

Landlord's approval of a sublease, assignment, hypothecation, transfer or third
party use or occupancy shall not constitute a waiver of Tenant's obligation to
obtain Landlord's consent to further assignments or subleases, hypothecations,
transfers or third party use or occupancy.

      (d) For purposes of this Article Ten, an assignment shall be deemed to
include a change in the majority control of Tenant, resulting from any transfer,
sale or assignment of shares of stock of Tenant occurring by operation of Law or
otherwise if Tenant is a corporation whose shares of stock are not traded
publicly. If Tenant is a partnership, any change in the partners of Tenant shall
be deemed to be an assignment.

10.02 RECAPTURE

Landlord shall have the option to exclude from the Premises covered by this
Lease ("recapture"), the space proposed to be sublet or subject to the
assignment, effective as of the proposed commencement date of such sublease or
assignment. If Landlord elects to recapture, Tenant shall surrender possession
of the space proposed to be subleased or subject to the assignment to Landlord
on the effective date of recapture of such space from the Premises, such date
being the Termination Date for such space. Effective as of the date of recapture
of any portion of the Premises pursuant to this section, the Monthly Base Rent,
Rentable Area of the Premises and Tenant's Share shall be adjusted accordingly.
Notwithstanding any provision of this Article to the contrary: (a) Landlord
shall not have the option to recapture with respect to any sublease or
assignment to an Affiliate; (b) Landlord shall have no obligation to consent to
an assignment to VelocityHSI, Inc. or any other Affiliate; and (c) so long as
BRE Properties, Inc. is the Tenant hereunder, Landlord will not object to
Tenant's allowing VelocityHSI, Inc. to use some or all of the Premises, and to
Tenant's signage identifying VelocityHSI, Inc. instead of Tenant's name.

10.03 EXCESS RENT

Tenant shall pay Landlord on the first day of each month during the term of the
sublease or assignment, seventy-five percent (75%) of the amount by which the
sum of all rent and other consideration (direct or indirect) due from the
subtenant or assignee for such month exceeds: (i) that portion of the Monthly
Base Rent and Rent Adjustments due under this Lease for said month which is
allocable to the space sublet or assigned; and (ii) the following costs and
expenses for the subletting or assignment of such space: (1) brokerage
commissions and attorneys' fees and expenses, (2) the actual costs paid in
making any improvements or substitutions in the Premises required by any
sublease or assignment; and (3) "free rent" periods, costs of any inducements or
concessions given to subtenant or assignee, moving costs, and other amounts in
respect of such subtenant's or assignee's other leases or occupancy
arrangements. All such costs and expenses shall be amortized over the term of
the sublease or assignment pursuant to sound accounting principles.

10.04 TENANT LIABILITY

In the event of any sublease or assignment, whether or not with Landlord's
consent, Tenant shall not be released or discharged from any liability, whether
past, present or future, under this Lease, including any liability arising from
the exercise of any renewal or expansion option, to the extent such exercise is
expressly permitted by Landlord. Tenant's liability shall remain primary, and in
the event of default by any subtenant, assignee or successor of Tenant in
performance or observance of any of the covenants or conditions of this Lease,
Landlord may proceed directly against Tenant without the necessity of exhausting
remedies against said subtenant, assignee or successor. After any assignment,
Landlord may consent to subsequent assignments or subletting of this Lease, or
amendments or modifications of this Lease with assignees of Tenant, without
notifying Tenant, or any successor of Tenant, and without obtaining its or their
consent thereto, and such action shall not relieve Tenant or Tenant's successor
of liability under this Lease, unless and except to the extent that Tenant or
Tenant's successor would be relieved of such liability if its consent was not
obtained to a material change in a sublease or in this Lease which change is
materially adverse to Tenant or Tenant's successor. If Landlord grants consent
to such sublease or assignment, Tenant shall pay all reasonable attorneys' fees
and expenses incurred by Landlord with respect to such assignment or sublease.
In addition, if Tenant has any options to extend the term of this Lease or to
add other space to the Premises, such options shall not be available to any
subtenant or assignee, directly or indirectly without Landlord's express written
consent, which may be withheld in Landlord's sole discretion.

10.05 ASSUMPTION AND ATTORNMENT

If Tenant shall assign this Lease as permitted herein, the assignee shall
expressly assume all of the obligations of Tenant hereunder in a written
instrument satisfactory to Landlord and furnished to Landlord not later than
fifteen (15) days prior to the effective date of the assignment. If Tenant shall
sublease the Premises as permitted herein, Tenant shall, at Landlord's option,
within fifteen (15) days following any request by Landlord, obtain and furnish
to Landlord the written agreement of such subtenant to the effect that the
subtenant will attorn to Landlord and will pay all subrent directly to Landlord.

                                 ARTICLE ELEVEN
                              DEFAULT AND REMEDIES

11.01 EVENTS OF DEFAULT

The occurrence or existence of any one or more of the following shall constitute
a "Default" by Tenant under this Lease:

            (i) Tenant fails to pay any installment or other payment of Rent
      including Rent Adjustment Deposits or Rent Adjustments within three (3)
      days after the date when due;

                                       14
<PAGE>

            (ii) Tenant fails to observe or perform any of the other covenants,
      conditions or provisions of this Lease or the Workletter and fails to cure
      such default within fifteen (15) days after written notice thereof to
      Tenant, unless the default involves a hazardous condition, which shall be
      cured forthwith or unless the failure to perform is a Default for which
      this Lease specifies there is no cure or grace period;

            (iii) the interest of Tenant in this Lease is levied upon under
      execution or other legal process;

            (iv) a petition is filed by or against Tenant to declare Tenant
      bankrupt or seeking a plan of reorganization or arrangement under any
      Chapter of the Bankruptcy Act, or any amendment, replacement or
      substitution therefor, or to delay payment of, reduce or modify Tenant's
      debts, which in the case of an involuntary action is not discharged within
      thirty (30) days;

            (v) Tenant is declared insolvent by Law or any assignment of
      Tenant's property is made for the benefit of creditors;

            (vi) a receiver is appointed for Tenant or Tenant's property, which
      appointment is not discharged within thirty (30) days;

            (vii) any action taken by or against Tenant to reorganize or modify
      Tenant's capital structure in a materially adverse way which in the case
      of an involuntary action is not discharged within thirty (30) days;

            (viii) upon the dissolution of Tenant; or

            (ix) upon the third occurrence within any Lease Year that Tenant
      fails to pay Rent when due or has breached a particular covenant of this
      Lease (whether or not such failure or breach is thereafter cured within
      any stated cure or grace period or statutory period).

11.02 LANDLORD'S REMEDIES

      (a) A Default shall constitute a breach of the Lease for which Landlord
shall have the rights and remedies set forth in this Section 11.02 and all other
rights and remedies set forth in this Lease or now or hereafter allowed by Law,
whether legal or equitable, and all rights and remedies of Landlord shall be
cumulative and none shall exclude any other right or remedy.

      (b) With respect to a Default, at any time Landlord may terminate Tenant's
right to possession by written notice to Tenant stating such election. Any
written notice required pursuant to Section 11.01 shall constitute notice of
unlawful detainer pursuant to California Code of Civil Procedure Section 1161
if, at Landlord's sole discretion, it states Landlord's election that Tenant's
right to possession is terminated after expiration of any period required by Law
or any longer period required by Section 11.01. Upon the expiration of the
period stated in Landlord's written notice of termination (and unless such
notice provides an option to cure within such period and Tenant cures the
Default within such period), Tenant's right to possession shall terminate and
this Lease shall terminate, and Tenant shall remain liable as hereinafter
provided. Upon such termination in writing of Tenant's right to possession,
Landlord shall have the right, subject to applicable Law, to re-enter the
Premises and dispossess Tenant and the legal representatives of Tenant and all
other occupants of the Premises by unlawful detainer or other summary
proceedings, or otherwise as permitted by Law, regain possession of the Premises
and remove their property (including their trade fixtures, personal property and
those Tenant Additions which Tenant is required or permitted to remove under
Article Twelve), but Landlord shall not be obligated to effect such removal, and
such property may, at Landlord's option, be stored elsewhere, sold or otherwise
dealt with as permitted by Law, at the risk of, expense of and for the account
of Tenant, and the proceeds of any sale shall be applied pursuant to Law.
Landlord shall in no event be responsible for the value, preservation or
safekeeping of any such property. Tenant hereby waives all claims for damages
that may be caused by Landlord's removing or storing Tenant's personal property
pursuant to this Section or Section 12.01, and Tenant hereby indemnifies, and
agrees to defend, protect and hold harmless, the Indemnitees from any and all
loss, claims, demands, actions, expenses, liability and cost (including
attorneys' fees and expenses) arising out of or in any way related to such
removal or storage. Upon such written termination of Tenant's right to
possession and this Lease, Landlord shall have the right to recover damages for
Tenant's Default as provided herein or by Law, including the following damages
provided by California Civil Code Section 1951.2:

            (1) the worth at the time of award of the unpaid Rent which had been
      earned at the time of termination;

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

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

            (4) any other amount necessary to compensate Landlord for all the
      detriment proximately caused by Tenant's failure to perform its
      obligations under this Lease or which in the ordinary course of things
      would be likely to result therefrom. The word "rent" as used in this
      Section 11.02 shall have the same meaning as the defined term Rent in this
      Lease. The "worth at the time of award" of the amount referred to in
      clauses (1) and (2) above is computed by allowing interest at the Default
      Rate. The worth at the time of award of the amount referred to in clause
      (3) above 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%). For the purpose of determining

                                       15
<PAGE>

      unpaid Rent under clause (3) above, the monthly Rent reserved in this
      Lease shall be deemed to be the sum of the Monthly Base Rent, and monthly
      Storage Space Rent, if any, and the amounts last payable by Tenant as Rent
      Adjustments for the calendar year in which Landlord terminated this Lease
      as provided hereinabove.

      (c) Even if Tenant is in Default and/or has abandoned the Premises, this
Lease shall continue in effect for so long as Landlord does not terminate
Tenant's right to possession by written notice as provided in Section 11.02(b)
above, and Landlord may enforce all its rights and remedies under this Lease,
including the right to recover Rent as it becomes due under this Lease. In such
event, Landlord shall have all of the rights and remedies of a landlord under
California Civil Code Section 1951.4 (lessor may continue Lease in effect after
Tenant's Default and abandonment and recover Rent as it becomes due, if Tenant
has the right to sublet or assign, subject only to reasonable limitations), or
any successor statute. During such time as Tenant is in Default, if Landlord has
not terminated this Lease by written notice and if Tenant requests Landlord's
consent to an assignment of this Lease or a sublease of the Premises, subject to
Landlord's option to recapture pursuant to Section 10.02, Landlord shall not
unreasonably withhold its consent to such assignment or sublease. Tenant
acknowledges and agrees that the provisions of Article Ten shall be deemed to
constitute reasonable limitations of Tenant's right to assign or sublet. Tenant
acknowledges and agrees that in the absence of written notice pursuant to
Section 11.02(b) above terminating Tenant's right to possession, no other act of
Landlord shall constitute a termination of Tenant's right to possession or an
acceptance of Tenant's surrender of the Premises, including acts of maintenance
or preservation or efforts to relet the Premises or the appointment of a
receiver upon initiative of Landlord to protect Landlord's interest under this
Lease or the withholding of consent to a subletting or assignment, or
terminating a subletting or assignment, if in accordance with other provisions
of this Lease.

      (d) In the event that Landlord seeks an injunction with respect to a
breach or threatened breach by Tenant of any of the covenants, conditions or
provisions of this Lease, Tenant agrees to pay the premium for any bond required
in connection with such injunction.

      (e) Tenant hereby waives any and all rights to relief from forfeiture,
redemption or reinstatement granted by Law (including California Civil Code of
Procedure Sections 1174 and 1179) in the event of Tenant being evicted or
dispossessed for any cause or in the event of Landlord obtaining possession of
the Premises by reason of Tenant's Default or otherwise;

      (f) When this Lease requires giving or service of a notice, that notice
shall replace rather than supplement any equivalent or similar statutory notice,
including any equivalent or similar notices required by California Code of Civil
Procedure Section 1161 or any similar or successor statute. When a statute
requires service of a notice in a particular manner, service of that notice (or
a similar notice required by this Lease) in the manner required by Article
Twenty-four shall replace and satisfy the statutory service-of-notice
procedures, including those required by Code of Civil Procedure section 1162 or
any similar or successor statute.

      (g) The voluntary or other surrender or termination of this Lease, or a
mutual termination or cancellation thereof, shall not work a merger and shall
terminate all or any existing assignments, subleases, subtenancies or
occupancies permitted by Tenant, except if and as otherwise specified in writing
by Landlord.

      (h) No delay or omission in the exercise of any right or remedy of
Landlord upon any default by Tenant, and no exercise by Landlord of its rights
pursuant to Section 26.15 to perform any duty which Tenant fails timely to
perform, shall impair any right or remedy or be construed as a waiver. No
provision of this Lease shall be deemed waived by Landlord unless such waiver is
in a writing signed by Landlord. The waiver by Landlord of any breach of any
provision of this Lease shall not be deemed a waiver of any subsequent breach of
the same or any other provision of this Lease.

11.03 ATTORNEY'S FEES

In the event any party brings any suit or other proceeding with respect to the
subject matter or enforcement of this Lease, the prevailing party (as determined
by the court, agency or other authority before which such suit or proceeding is
commenced) shall, in addition to such other relief as may be awarded, be
entitled to recover attorneys' fees, expenses and costs of investigation as
actually incurred, including court costs, expert witness fees, costs and
expenses of investigation, and all attorneys' fees, costs and expenses in any
such suit or proceeding (including in any action or participation in or in
connection with any case or proceeding under the Bankruptcy Code, 11 United
States Code Sections 101 et seq., or any successor statutes, in establishing or
enforcing the right to indemnification, in appellate proceedings, or in
connection with the enforcement or collection of any judgment obtained in any
such suit or proceeding).

11.04 BANKRUPTCY

The following provisions shall apply in the event of the bankruptcy or
insolvency of Tenant:

      (a) In connection with any proceeding under Chapter 7 of the Bankruptcy
Code where the trustee of Tenant elects to assume this Lease for the purposes of
assigning it, such election or assignment, may only be made upon compliance with
the provisions of (b) and (c) below, which conditions Landlord and Tenant
acknowledge to be commercially reasonable. In the event the trustee elects to
reject this Lease then Landlord shall immediately be entitled to possession of
the Premises without further obligation to Tenant or the trustee.

      (b) Any election to assume this Lease under Chapter 11 or 13 of the
Bankruptcy Code by Tenant as debtor-in-possession or by Tenant's trustee (the
"Electing Party") must provide for:

      The Electing Party to cure or provide to Landlord adequate assurance that
      it will cure all monetary defaults under this Lease within fifteen (15)
      days from the date of assumption and it will cure all nonmonetary defaults

                                       16
<PAGE>

      under this Lease within thirty (30) days from the date of assumption.
      Landlord and Tenant acknowledge such condition to be commercially
      reasonable.

      (c) If the Electing Party has assumed this Lease or elects to assign
Tenant's interest under this Lease to any other person, such interest may be
assigned only if the intended assignee has provided adequate assurance of future
performance (as herein defined), of all of the obligations imposed on Tenant
under this Lease.

      For the purposes hereof, "adequate assurance of future performance" means
      that Landlord has ascertained that each of the following conditions has
      been satisfied:

            (i) The assignee has submitted a current financial statement,
      certified by its chief financial officer, which shows a net worth and
      working capital in amounts sufficient to assure the future performance by
      the assignee of Tenant's obligations under this Lease; and

            (ii) Landlord has obtained consents or waivers from any third
      parties which may be required under a lease, mortgage, financing
      arrangement, or other agreement by which Landlord is bound, to enable
      Landlord to permit such assignment.

      (d) Landlord's acceptance of rent or any other payment from any trustee,
receiver, assignee, person, or other entity will not be deemed to have waived,
or waive, the requirement of Landlord's consent, Landlord's right to terminate
this Lease for any transfer of Tenant's interest under this Lease without such
consent, or Landlord's claim for any amount of Rent due from Tenant.

11.05   LANDLORD'S DEFAULT

Landlord shall be in default hereunder in the event Landlord has not begun and
pursued with reasonable diligence the cure of any failure of Landlord to meet
its obligations hereunder within thirty (30) days after the receipt by Landlord
of written notice from Tenant of the alleged failure to perform. In no event
shall Tenant have the right to terminate or rescind this Lease as a result of
Landlord's default as to any covenant or agreement contained in this Lease.
Tenant hereby waives such remedies of termination and rescission and hereby
agrees that Tenant's remedies for default hereunder and for breach of any
promise or inducement shall be limited to a suit for damages and/or injunction.
In addition, Tenant hereby covenants that, prior to the exercise of any such
remedies, it will give Mortgagee notice and a reasonable time to cure any
default by Landlord.

                                 ARTICLE TWELVE
                              SURRENDER OF PREMISES

12.01 IN GENERAL

Upon the Termination Date, Tenant shall surrender and vacate the Premises
immediately and deliver possession thereof to Landlord in a clean, good and
tenantable condition, ordinary wear and tear, and damage caused by Landlord
excepted. Tenant shall deliver to Landlord all keys to the Premises. Tenant
shall remove from the Premises all movable personal property of Tenant and
Tenant's trade fixtures, including, subject to Section 6.04, cabling for any of
the foregoing. Tenant shall be entitled to remove such Tenant Additions which at
the time of their installation Landlord and Tenant agreed may be removed by
Tenant. Tenant shall also remove such other Tenant Additions as required by
Landlord, including any Tenant Additions containing Hazardous Materials. Tenant
immediately shall repair all damage resulting from removal of any of Tenant's
property, furnishings or Tenant Additions, shall close all floor, ceiling and
roof openings and shall restore the Premises to a tenantable condition as
reasonably determined by Landlord. If any of the Tenant Additions which were
installed by Tenant involved the lowering of ceilings, raising of floors or the
installation of specialized wall or floor coverings or lights, then Tenant shall
also be obligated to return such surfaces to their condition prior to the
commencement of this Lease. Tenant shall also be required to close any
staircases or other openings between floors. In the event possession of the
Premises is not delivered to Landlord when required hereunder, or if Tenant
shall fail to remove those items described above, Landlord may (but shall not be
obligated to), at Tenant's expense, remove any of such property and store, sell
or otherwise deal with such property as provided in Section 11.02(b), including
the waiver and indemnity obligations provided in that Section, and undertake, at
Tenant's expense, such restoration work as Landlord deems necessary or
advisable.

12.02 LANDLORD'S RIGHTS

All property which may be removed from the Premises by Landlord shall be
conclusively presumed to have been abandoned by Tenant and Landlord may deal
with such property as provided in Section 11.02(b), including the waiver and
indemnity obligations provided in that Section. Tenant shall also reimburse
Landlord for all costs and expenses incurred by Landlord in removing any of
Tenant Additions and in restoring the Premises to the condition required by this
Lease at the Termination Date.

                                ARTICLE THIRTEEN
                                  HOLDING OVER

Tenant shall pay Landlord the greater of (i) double the monthly Rent payable for
the month immediately preceding the holding over (including increases for Rent
Adjustments which Landlord may reasonably estimate) or, (ii) double the fair
market rental value of the Premises as reasonably determined by Landlord for
each month or portion thereof that Tenant retains possession of the Premises, or
any portion thereof, after the Termination Date (without reduction for any
partial month that Tenant retains possession). Tenant shall also pay all damages
sustained by Landlord by reason of such retention of possession. The provisions
of this Article shall not constitute a waiver by Landlord of any re-entry rights
of Landlord and Tenant's continued occupancy of the Premises shall be as a
tenancy in sufferance. If Tenant

                                       17
<PAGE>

retains possession of the Premises, or any part thereof for thirty (30) days
after the Termination Date then at the sole option of Landlord expressed by
written notice to Tenant, but not otherwise, such holding over shall constitute
an extension of the Term of this Lease for a period of one (1) year on the same
terms and conditions (including those with respect to the payment of Rent) as
provided in this Lease, except that the Monthly Base Rent for such period shall
be equal to the greater of (i) 150% of the Monthly Base Rent payable during the
month preceding the Termination Date, or (ii) 150% of the monthly base rent then
being quoted by Landlord for similar space in the Building.

                                ARTICLE FOURTEEN

                        DAMAGE BY FIRE OR OTHER CASUALTY

14.01 SUBSTANTIAL UNTENANTABILITY

      (a) If any fire or other casualty (whether insured or uninsured) renders
all or a substantial portion of the Premises or the Building untenantable,
Landlord shall, with reasonable promptness after the occurrence of such damage,
estimate the length of time that will be required to substantially complete the
repair and restoration and shall by notice advise Tenant of such estimate
("Landlord's Notice"). If Landlord estimates that the amount of time required to
substantially complete such repair and restoration will exceed one hundred
eighty (180) days from the date such damage occurred, then Landlord, or Tenant
if all or a substantial portion of the Premises is rendered untenantable, shall
have the right to terminate this Lease as of the date of such damage upon giving
written notice to the other at any time within twenty (20) days after delivery
of Landlord's Notice, provided that if Landlord so chooses, Landlord's Notice
may also constitute such notice of termination.

      (b) Unless this Lease is terminated as provided in the preceding
subparagraph, Landlord shall proceed with reasonable promptness to repair and
restore the Premises to its condition as existed prior to such casualty, subject
to reasonable delays for insurance adjustments and Force Majeure delays, and
also subject to zoning Laws and building codes then in effect. Landlord shall
have no liability to Tenant, and Tenant shall not be entitled to terminate this
Lease if such repairs and restoration are not in fact completed within the time
period estimated by Landlord so long as Landlord shall proceed with reasonable
diligence to complete such repairs and restoration.

      (c) Tenant acknowledges that Landlord shall be entitled to the full
proceeds of any insurance coverage, whether carried by Landlord or Tenant, for
damages to the Premises, except for those proceeds of Tenant's insurance of its
own personal property and equipment which would be removable by Tenant at the
Termination Date. All such insurance proceeds shall be payable to Landlord
whether or not the Premises are to be repaired and restored, provided, however,
if this Lease is not terminated and the parties proceed to repair and restore
Tenant Additions at Tenant's cost, to the extent Landlord received proceeds of
Tenant's insurance covering Tenant Additions, such proceeds shall be applied to
reimburse Tenant for its cost of repairing and restoring Tenant Additions.

      (d) Notwithstanding anything to the contrary herein set forth: (i)
Landlord shall have no duty pursuant to this Section to repair or restore any
portion of any Tenant Additions or to expend for any repair or restoration of
the Premises or Building amounts in excess of insurance proceeds paid to
Landlord and available for repair or restoration; and (ii) Tenant shall not have
the right to terminate this Lease pursuant to this Section if any damage or
destruction was caused by the act or neglect of Tenant, its agent or employees.
Whether or not the Lease is terminated pursuant to this Article Fourteen, in no
event shall Tenant be entitled to any compensation or damages for loss of the
use of the whole or any part of the Premises or for any inconvenience or
annoyance occasioned by any such damage, destruction, rebuilding or restoration
of the Premises or the Building or access thereto.

      (e) Any repair or restoration of the Premises performed by Tenant shall be
in accordance with the provisions of Article Nine hereof.

14.02 INSUBSTANTIAL UNTENANTABILITY

If the Premises or the Building is damaged by a casualty but neither is rendered
substantially untenantable and Landlord estimates that the time to substantially
complete the repair or restoration will not exceed one hundred eighty (180) days
from the date such damage occurred, then Landlord shall proceed to repair and
restore the Building or the Premises other than Tenant Additions, with
reasonable promptness, unless such damage is to the Premises and occurs during
the last six (6) months of the Term, in which event either Tenant or Landlord
shall have the right to terminate this Lease as of the date of such casualty by
giving written notice thereof to the other within twenty (20) days after the
date of such casualty. Notwithstanding the foregoing, Landlord's obligation to
repair shall be limited in accordance with the provisions of Section 14.01
above.

14.03 RENT ABATEMENT

Except for the negligence or willful act of Tenant or its agents, employees,
contractors or invitees, if all or any part of the Premises are rendered
untenantable by fire or other casualty and this Lease is not terminated, Monthly
Base Rent and Rent Adjustments shall abate for that part of the Premises which
is untenantable on a per diem basis from the date of the casualty until Landlord
has Substantially Completed the repair and restoration work in the Premises
which it is required to perform, provided, that as a result of such casualty,
Tenant does not occupy the portion of the Premises which is untenantable during
such period.

14.04 WAIVER OF STATUTORY REMEDIES

The provisions of this Lease, including this Article Fourteen, constitute an
express agreement between Landlord and Tenant with respect to any and all damage
to, or destruction of, the Premises or the Property or any part of either, and
any Law, including Sections 1932(2), 1933(4), 1941 and 1942 of the California
Civil Code, with respect to any rights

                                       18
<PAGE>

or obligations concerning damage or destruction shall have no application to
this Lease or to any damage to or destruction of all or any part of the Premises
or the Property or any part of either, and are hereby waived.

                                 ARTICLE FIFTEEN
                                 EMINENT DOMAIN

15.01 TAKING OF WHOLE OR SUBSTANTIAL PART

In the event the whole or any substantial part of the Building or of the
Premises is taken or condemned by any competent authority for any public use or
purpose (including a deed given in lieu of condemnation) and is thereby rendered
untenantable, this Lease shall terminate as of the date title vests in such
authority, and Monthly Base Rent and Rent Adjustments shall be apportioned as of
the Termination Date. Notwithstanding anything to the contrary herein set forth,
in the event the taking is temporary (for less than the remaining term of the
Lease), Landlord may elect either (i) to terminate this Lease or (ii) permit
Tenant to receive the entire award attributable to the Premises in which case
Tenant shall continue to pay Rent and this Lease shall not terminate.

15.02 TAKING OF PART

In the event a part of the Building or the Premises is taken or condemned by any
competent authority (or a deed is delivered in lieu of condemnation) and this
Lease is not terminated, the Lease shall be amended to reduce or increase, as
the case may be, the Monthly Base Rent and Tenant's Share to reflect the
Rentable Area of the Premises or Building, as the case may be, remaining after
any such taking or condemnation. Landlord, upon receipt and to the extent of the
award in condemnation (or proceeds of sale) shall make necessary repairs and
restorations to the Premises (exclusive of Tenant Additions) and to the Building
to the extent necessary to constitute the portion of the Building not so taken
or condemned as a complete architectural and economically efficient unit.
Notwithstanding the foregoing, if as a result of any taking, or a governmental
order that the grade of any street or alley adjacent to the Building is to be
changed and such taking or change of grade makes it necessary or desirable to
substantially remodel or restore the Building or prevents the economical
operation of the Building, Landlord shall have the right to terminate this Lease
upon ninety (90) days prior written notice to Tenant.

15.03 COMPENSATION

Landlord shall be entitled to receive the entire award (or sale proceeds) from
any such taking, condemnation or sale without any payment to Tenant, and Tenant
hereby assigns to Landlord Tenant's interest, if any, in such award; provided,
however, Tenant shall have the right separately to pursue against the condemning
authority a separate award in respect of the loss, if any, to Tenant Additions
paid for by Tenant without any credit or allowance from Landlord so long as
there is no diminution of Landlord's award as a result.

                                 ARTICLE SIXTEEN
                                    INSURANCE

16.01 TENANT'S INSURANCE

Tenant, at Tenant's expense, agrees to maintain in force, with a company or
companies acceptable to Landlord, during the Term: (a) Commercial General
Liability Insurance on a primary basis and without any right of contribution
from any insurance carried by Landlord covering the Premises on an occurrence
basis against all claims for personal injury, bodily injury, death and property
damage, including contractual liability covering the indemnification provisions
in this Lease. Such insurance shall be for such limits that are reasonably
required by Landlord from time to time but not less than a combined single limit
of Five Million and No/100 Dollars ($5,000,000.00); (b) Workers' Compensation
and Employers' Liability Insurance to the extent required by and in accordance
with the Laws of the State of California; (c) "All Risks" property insurance in
an amount adequate to cover the full replacement cost of all Tenant Additions,
equipment, installations, fixtures and contents of the Premises in the event of
loss; (d) In the event a motor vehicle is to be used by Tenant in connection
with its business operation from the Premises, Comprehensive Automobile
Liability Insurance coverage with limits of not less than Three Million and
No/100 Dollars ($3,000,000.00) combined single limit coverage against bodily
injury liability and property damage liability arising out of the use by or on
behalf of Tenant, its agents and employees in connection with this Lease, of any
owned, non-owned or hired motor vehicles; and (e) such other insurance or
coverages as Landlord reasonably requires.

16.02 FORM OF POLICIES

Each policy referred to in 16.01 shall satisfy the following requirements. Each
policy shall (i) name Landlord and the Indemnitees as additional insureds
(except Workers' Compensation and Employers' Liability Insurance), (ii) be
issued by one or more responsible insurance companies licensed to do business in
the State of California reasonably satisfactory to Landlord, (iii) where
applicable, provide for deductible amounts satisfactory to Landlord and not
permit co-insurance, (iv) shall provide that such insurance may not be canceled
or amended without thirty (30) days' prior written notice to the Landlord, and
(v) each policy of "All-Risks" property insurance shall provide that the policy
shall not be invalidated should the insured waive in writing prior to a loss,
any or all rights of recovery against any other party for losses covered by such
policies. Tenant shall deliver to Landlord, certificates of insurance and at
Landlord's request, copies of all policies and renewals thereof to be maintained
by Tenant hereunder, not less than ten (10) days prior to the Commencement Date
and not less than ten (10) days prior to the expiration date of each policy.

16.03 LANDLORD'S INSURANCE

Landlord agrees to purchase and keep in full force and effect during the Term
hereof, including any extensions or renewals thereof, insurance under policies
issued by insurers of recognized responsibility, qualified to do business in

                                       19
<PAGE>

the State of California on the Building in amounts not less than the greater of
eighty (80%) percent of the then full replacement cost (without depreciation) of
the Building (above foundations and excluding Tenant Additions) or an amount
sufficient to prevent Landlord from becoming a co-insurer under the terms of the
applicable policies, against fire and such other risks as may be included in
standard forms of all risk coverage insurance reasonably available from time to
time. Landlord agrees to maintain in force during the Term, Commercial General
Liability Insurance covering the Building on an occurrence basis against all
claims for personal injury, bodily injury, death and property damage. Such
insurance shall be for a combined single limit of Five Million and No/100
Dollars ($5,000,000.00). Neither Landlord's obligation to carry such insurance
nor the carrying of such insurance shall be deemed to be an indemnity by
Landlord with respect to any claim, liability, loss, cost or expense due, in
whole or in part, to Tenant's negligent acts or omissions or willful misconduct.
Without obligation to do so, Landlord may, in its sole discretion from time to
time, carry insurance in amounts greater and/or for coverage additional to the
coverage and amounts set forth above.

16.04 WAIVER OF SUBROGATION

      (a) Landlord agrees that, if obtainable at no, or minimal, additional
cost, and so long as the same is permitted under the laws of the State of
California, it will include in its "All Risks" policies appropriate clauses
pursuant to which the insurance companies (i) waive all right of subrogation
against Tenant with respect to losses payable under such policies and/or (ii)
agree that such policies shall not be invalidated should the insured waive in
writing prior to a loss any or all right of recovery against any party for
losses covered by such policies.

      (b) Tenant agrees to include, if obtainable at no, or minimal, additional
cost, and so long as the same is permitted under the laws of the State of
California, in its "All Risks" insurance policy or policies on Tenant Additions,
whether or not removable, and on Tenant's furniture, furnishings, fixtures and
other property removable by Tenant under the provisions of this Lease
appropriate clauses pursuant to which the insurance company or companies (i)
waive the right of subrogation against Landlord and/or any tenant of space in
the Building with respect to losses payable under such policy or policies and/or
(ii) agree that such policy or policies shall not be invalidated should the
insured waive in writing prior to a loss any or all right of recovery against
any party for losses covered by such policy or policies. If Tenant is unable to
obtain in such policy or policies either of the clauses described in the
preceding sentence, Tenant shall, if legally possible and without necessitating
a change in insurance carriers, have Landlord named in such policy or policies
as an additional insured. If Landlord shall be named as an additional insured in
accordance with the foregoing, Landlord agrees to endorse promptly to the order
of Tenant, without recourse, any check, draft, or order for the payment of money
representing the proceeds of any such policy or representing any other payment
growing out of or connected with said policies, and Landlord does hereby
irrevocably waive any and all rights in and to such proceeds and payments.

      (c) Provided that Landlord's right of full recovery under its policy or
policies aforesaid is not adversely affected or prejudiced thereby, Landlord
hereby waives any and all right of recovery which it might otherwise have
against Tenant, its servants, agents and employees, for loss or damage occurring
to the Real Property and the fixtures, appurtenances and equipment therein,
except Tenant Additions, to the extent the same is covered by Landlord's
insurance, notwithstanding that such loss or damage may result from the
negligence or fault of Tenant, its servants, agents or employees. Provided that
Tenant's right of full recovery under its aforesaid policy or policies is not
adversely affected or prejudiced thereby, Tenant hereby waives any and all right
of recovery which it might otherwise have against Landlord, its servants, and
employees and against every other tenant in the Real Property who shall have
executed a similar waiver as set forth in this Section 16.04 (c) for loss or
damage to Tenant Additions, whether or not removable, and to Tenant's furniture,
furnishings, fixtures and other property removable by Tenant under the
provisions hereof to the extent the same is covered or coverable by Tenant's
insurance required under this Lease, notwithstanding that such loss or damage
may result from the negligence or fault of Landlord, its servants, agents or
employees, or such other tenant and the servants, agents or employees thereof.

      (d) Landlord and Tenant hereby agree to advise the other promptly if the
clauses to be included in their respective insurance policies pursuant to
subparagraphs (a) and (b) above cannot be obtained on the terms hereinbefore
provided and thereafter to furnish the other with a certificate of insurance or
copy of such policies showing the naming of the other as an additional insured,
as aforesaid. Landlord and Tenant hereby also agree to notify the other promptly
of any cancellation or change of the terms of any such policy which would affect
such clauses or naming. All such policies which name both Landlord and Tenant as
additional insureds shall, to the extent obtainable, contain agreements by the
insurers to the effect that no act or omission of any additional insured will
invalidate the policy as to the other additional insureds.

16.05 NOTICE OF CASUALTY

Tenant shall give Landlord notice in case of a fire or accident in the Premises
promptly after Tenant is aware of such event.

                                ARTICLE SEVENTEEN
                         WAIVER OF CLAIMS AND INDEMNITY

17.01 WAIVER OF CLAIMS

To the extent permitted by Law, Tenant releases the Indemnitees from, and waives
all claims for, damage to person or property sustained by the Tenant or any
occupant of the Premises or the Property resulting directly or indirectly from
any existing or future condition, defect, matter or thing in and about the
Premises or the Property or any part of either or any equipment or appurtenance
therein, or resulting from any accident in or about the Premises or the
Property, or resulting directly or indirectly from any act or neglect of any
tenant or occupant of the Property or of any other person, including Landlord's
agents and servants, except to the extent caused by the willful and wrongful act
of any of the Indemnitees. To the extent permitted by Law, Tenant hereby waives
any consequential damages, compensation or

                                       20
<PAGE>

claims for inconvenience or loss of business, rents, or profits as a result of
such injury or damage, whether or not caused by the willful and wrongful act of
any of the Indemnitees. If any such damage, whether to the Premises or the
Property or any part of either, or whether to Landlord or to other tenants in
the Property, results from any act or neglect of Tenant, its employees,
servants, agents, contractors, invitees or customers, Tenant shall be liable
therefor and Landlord may, at Landlord's option, repair such damage and Tenant
shall, upon demand by Landlord, as payment of additional Rent hereunder,
reimburse Landlord within ten (10) days of demand for the total cost of such
repairs, in excess of amounts, if any, paid to Landlord under insurance covering
such damages. Tenant shall not be liable for any such damage caused by its acts
or neglect if Landlord or a tenant has recovered the full amount of the damage
from proceeds of insurance policies and the insurance company has waived its
right of subrogation against Tenant.

17.02 INDEMNITY BY TENANT

To the extent permitted by Law, Tenant hereby indemnifies, and agrees to
protect, defend and hold the Indemnitees harmless, against any and all actions,
claims, demands, liability, costs and expenses, including attorneys' fees and
expenses for the defense thereof, arising from Tenant's occupancy of the
Premises, from the undertaking of any Tenant Additions or repairs to the
Premises, from the conduct of Tenant's business on the Premises, or from any
breach or default on the part of Tenant in the performance of any covenant or
agreement on the part of Tenant to be performed pursuant to the terms of this
Lease, or from any willful act or negligence of Tenant, its agents, contractors,
servants, employees, customers or invitees, in or about the Premises or the
Property or any part of either. In case of any action or proceeding brought
against the Indemnitees by reason of any such claim, upon notice from Landlord,
Tenant covenants to defend such action or proceeding by counsel chosen by
Landlord, in Landlord's sole discretion. Landlord reserves the right to settle,
compromise or dispose of any and all actions, claims and demands related to the
foregoing indemnity. The foregoing indemnity shall not operate to relieve any of
the Indemnitees of liability to the extent its share of liability is caused by
its gross negligence or by its willful and wrongful act. Further, the foregoing
indemnity and exception are subject to and shall not diminish any waivers by
Tenant or Landlord or their respective insurers in effect in accordance with
Section 16.04.

                                ARTICLE EIGHTEEN
                              RULES AND REGULATIONS

18.01 RULES

Tenant agrees for itself and for its subtenants, employees, agents, and invitees
to comply with the rules and regulations listed on Exhibit C attached hereto and
with all reasonable modifications and additions thereto which Landlord may make
from time to time.

18.02 ENFORCEMENT

Nothing in this Lease shall be construed to impose upon the Landlord any duty or
obligation to enforce the rules and regulations as set forth on Exhibit C or as
hereafter adopted, or the terms, covenants or conditions of any other lease as
against any other tenant, and the Landlord shall not be liable to the Tenant for
violation of the same by any other tenant, its servants, employees, agents,
visitors or licensees. Landlord shall use reasonable efforts to enforce the
rules and regulations of the Building in a uniform and non-discriminatory
manner.

                                ARTICLE NINETEEN
                           LANDLORD'S RESERVED RIGHTS

Landlord shall have the following rights exercisable without notice to Tenant
and without liability to Tenant for damage or injury to persons, property or
business and without being deemed an eviction or disturbance of Tenant's use or
possession of the Premises or giving rise to any claim for offset or abatement
of Rent: (1) to change the Building's name or street address upon thirty (30)
days' prior written notice to Tenant; (2) to install, affix and maintain all
signs on the exterior and/or interior of the Building; (3) to designate and/or
approve prior to installation, all types of signs, window shades, blinds,
drapes, awnings or other similar items, and all internal lighting that may be
visible from the exterior of the Premises; (4) upon reasonable notice to Tenant,
to display the Premises to prospective purchasers at reasonable hours at any
time during the Term and to prospective tenants at reasonable hours during the
last twelve (12) months of the Term; (5) to grant to any party the exclusive
right to conduct any business or render any service in or to the Building,
provided such exclusive right shall not operate to prohibit Tenant from using
the Premises for the purpose permitted hereunder; (6) to change the arrangement
and/or location of entrances or passageways, doors and doorways, corridors,
elevators, stairs, washrooms or public portions of the Building, and to close
entrances, doors, corridors, elevators or other facilities, provided that such
action shall not materially and adversely interfere with Tenant's access to the
Premises or the Building; (7) to have access for Landlord and other tenants of
the Building to any mail chutes and boxes located in or on the Premises as
required by any applicable rules of the United States Post Office; and (8) to
close the Building after Standard Operating Hours, except that Tenant and its
employees and invitees shall be entitled to admission at all times, under such
regulations as Landlord prescribes for security purposes.

                                 ARTICLE TWENTY
                              ESTOPPEL CERTIFICATE

20.01 IN GENERAL

Within fifteen (15) days after request therefor by Landlord, Mortgagee or any
prospective mortgagee or owner, Tenant agrees as directed in such request to
execute an Estoppel Certificate in recordable form, binding upon Tenant,
certifying (i) that this Lease is unmodified and in full force and effect (or if
there have been modifications, a description of such modifications and that this
Lease as modified is in full force and effect); (ii) the dates to which Rent has
been paid; (iii) that Tenant is in the possession of the Premises if that is the
case; (iv) that Landlord is not in default under this

                                       21
<PAGE>

Lease, or, if Tenant believes Landlord is in default, the nature thereof in
detail; (v) that Tenant has no offsets or defenses to the performance of its
obligations under this Lease (or if Tenant believes there are any offsets or
defenses, a full and complete explanation thereof); (vi) that the Premises have
been completed in accordance with the terms and provisions hereof, that Tenant
has accepted the Premises and the condition thereof and of all improvements
thereto and has no claims against Landlord or any other party with respect
thereto; (vii) that if an assignment of rents or leases has been served upon the
Tenant by a Mortgagee, Tenant will acknowledge receipt thereof and agree to be
bound by the provisions thereof; (viii) that Tenant will give to the Mortgagee
copies of all notices required or permitted to be given by Tenant to Landlord;
and (ix) to any other information reasonably requested.

20.02 ENFORCEMENT

In the event that Tenant fails to deliver an Estoppel Certificate, then such
failure shall be a Default for which there shall be no cure or grace period. In
addition to any other remedy available to Landlord, Landlord may impose a charge
equal to $500.00 for each day that Tenant fails to deliver an Estoppel
Certificate and Tenant shall be deemed to have irrevocably appointed Landlord as
Tenant's attorney-in-fact to execute and deliver such Estoppel Certificate.

                               ARTICLE TWENTY-ONE
                              RELOCATION OF TENANT

(Intentionally omitted)

                               ARTICLE TWENTY-TWO
                               REAL ESTATE BROKERS

Tenant represents that, except for the broker(s) listed in Section 1.01(18),
Tenant has not dealt with any real estate broker, sales person, or finder in
connection with this Lease, and no such person initiated or participated in the
negotiation of this Lease, or showed the Premises to Tenant. Tenant hereby
agrees to indemnify, protect, defend and hold Landlord and the Indemnitees,
harmless from and against any and all liabilities and claims for commissions and
fees arising out of a breach of the foregoing representation. Landlord agrees to
pay one commission to CB Richard Ellis, Inc., as and to the extent CB Richard
Ellis, Inc. is entitled, pursuant to Landlord's written agreement with CB
Richard Ellis, Inc., which is acting both as Landlord's Broker listed in Section
1.01(18) and Tenant's Broker. Except as CB Richard Ellis, Inc. may share such
commission internally, Tenant acknowledges and agrees that Landlord is not
obligated to pay any other commission or additional amount to CB Richard Ellis,
Inc. for representation of Tenant, or to those individuals of CB Richard Ellis,
Inc. who represent Tenant, and any such additional amount (if any) shall be
payable by Tenant.

                                   ARTICLE TWENTY-THREE
                                   MORTGAGEE PROTECTION

23.01 SUBORDINATION AND ATTORNMENT

This Lease is and shall be expressly subject and subordinate at all times to (i)
any ground or underlying lease of the Real Property, now or hereafter existing,
and all amendments, extensions, renewals and modifications to any such lease,
and (ii) the lien of any mortgage or trust deed now or hereafter encumbering fee
title to the Real Property and/or the leasehold estate under any such lease, and
all amendments, extensions, renewals, replacements and modifications of such
mortgage or trust deed and/or the obligation secured thereby, unless such ground
lease or ground lessor, or mortgage, trust deed or Mortgagee, expressly provides
or elects that the Lease shall be superior to such lease or mortgage or trust
deed. If any such mortgage or trust deed is foreclosed (including any sale of
the Real Property pursuant to a power of sale), or if any such lease is
terminated, upon request of the Mortgagee or ground lessor, as the case may be,
Tenant shall attorn to the purchaser at the foreclosure sale or to the ground
lessor under such lease, as the case may be, provided, however, that such
purchaser or ground lessor shall not be (i) bound by any payment of Rent for
more than one month in advance except payments in the nature of security for the
performance by Tenant of its obligations under this Lease; (ii) subject to any
offset, defense or damages arising out of a default of any obligations of any
preceding Landlord; or (iii) bound by any amendment or modification of this
Lease made without the written consent of the Mortgagee or ground lessor; or
(iv) liable for any security deposits not actually received in cash by such
purchaser or ground lessor. This subordination shall be self-operative and no
further certificate or instrument of subordination need be required by any such
Mortgagee or ground lessor. In confirmation of such subordination, however,
Tenant shall execute promptly any reasonable certificate or instrument that
Landlord, Mortgagee or ground lessor may request. Tenant hereby constitutes
Landlord as Tenant's attorney-in-fact to execute such certificate or instrument
for and on behalf of Tenant upon Tenant's failure to do so within fifteen (15)
days of a request to do so. Upon request by such successor in interest, Tenant
shall execute and deliver reasonable instruments confirming the attornment
provided for herein.

23.02 MORTGAGEE PROTECTION

Tenant agrees to give any Mortgagee or ground lessor, by registered or certified
mail, a copy of any notice of default served upon the Landlord by Tenant,
provided that prior to such notice Tenant has received notice (by way of service
on Tenant of a copy of an assignment of rents and leases, or otherwise) of the
address of such Mortgagee or ground lessor. Tenant further agrees that if
Landlord shall have failed to cure such default within the time provided for in
this

                                       22
<PAGE>

Lease, then the Mortgagee or ground lessor shall have an additional thirty (30)
days after receipt of notice thereof within which to cure such default or if
such default cannot be cured within that time, then such additional notice time
as may be necessary, if, within such thirty (30) days, any Mortgagee or ground
lessor has commenced and is diligently pursuing the remedies necessary to cure
such default (including commencement of foreclosure proceedings or other
proceedings to acquire possession of the Real Property, if necessary to effect
such cure). Such period of time shall be extended by any period within which
such Mortgagee or ground lessor is prevented from commencing or pursuing such
foreclosure proceedings or other proceedings to acquire possession of the Real
Property by reason of Landlord's bankruptcy. Until the time allowed as aforesaid
for Mortgagee or ground lessor to cure such defaults has expired without cure,
Tenant shall have no right to, and shall not, terminate this Lease on account of
default. This Lease may not be modified or amended so as to reduce the Rent or
shorten the Term, or so as to adversely affect in any other respect to any
material extent the rights of the Landlord, nor shall this Lease be canceled or
surrendered, without the prior written consent, in each instance, of the ground
lessor or the Mortgagee.

                               ARTICLE TWENTY-FOUR
                                     NOTICES

      (a) All notices, demands or requests provided for or permitted to be given
pursuant to this Lease must be in writing and shall be personally delivered,
sent by Federal Express or other reputable overnight courier service, or mailed
by first class, registered or certified United States mail, return receipt
requested, postage prepaid.

      (b) All notices, demands or requests to be sent pursuant to this Lease
shall be deemed to have been properly given or served by delivering or sending
the same in accordance with this Section, addressed to the parties hereto at
their respective addresses listed in Sections 1.01(2) and (3).

      (c) Notices, demands or requests sent by mail or overnight courier service
as described above shall be effective upon deposit in the mail or with such
courier service. However, the time period in which a response to any such
notice, demand or request must be given shall commence to run from (i) in the
case of delivery by mail, the date of receipt on the return receipt of the
notice, demand or request by the addressee thereof, or (ii) in the case of
delivery by Federal Express or other overnight courier service, the date of
acceptance of delivery by an employee, officer, director or partner of Landlord
or Tenant. Rejection or other refusal to accept or the inability to deliver
because of changed address of which no notice was given, as indicated by advice
from Federal Express or other overnight courier service or by mail return
receipt, shall be deemed to be receipt of notice, demand or request sent.
Notices may also be served by personal service upon any officer, director or
partner of Landlord or Tenant, and shall be effective upon such service.

      (d) By giving to the other party at least thirty (30) days written notice
thereof, either party shall have the right from time to time during the term of
this Lease to change their respective addresses for notices, statements, demands
and requests, provided such new address shall be within the United States of
America.

                               ARTICLE TWENTY-FIVE
                                  STORAGE SPACE

25.01 IN GENERAL

Landlord shall lease to Tenant for the Term, __________ square feet of Rentable
Area on the ________ floor of the Building to be used and occupied by Tenant
only as storage space ("Storage Space"). The Storage Space shall be made
available to Tenant in broom clean condition. Landlord has no obligation to make
any improvement to the Storage Space other than to install a single light
fixture, a door with a lock and demising walls. Tenant's use of the Storage
Space shall at all times be in compliance with the provisions of this Lease.

25.02 STORAGE SPACE RENT

Tenant shall pay Landlord as rent for the Storage Space (the "Storage Space
Rent") an amount equal to        . The Storage Space Rent shall be payable as
and when Monthly Base Rent is payable, commencing on the date that possession of
the Storage Space is delivered to Tenant. Notwithstanding the foregoing, for
purposes of calculating Tenant's Share, the Storage Space shall not be included
in the Rentable Area of the Premises.

25.03 RELOCATION

Landlord may from time to time upon thirty (30) days prior notice Tenant
relocate any or all of the Storage Space to other storage areas in the Project
("New Storage Space") in which event the New Storage Space shall be deemed to be
the Storage Space hereunder. Landlord shall pay the actual and reasonable
expenses of physically moving Tenant's property to the New Storage Space.

                               ARTICLE TWENTY-SIX
                                  MISCELLANEOUS

26.01 LATE CHARGES

      (a) All payments required hereunder (other than the Monthly Base Rent,
Rent Adjustments, and Rent Adjustment Deposits, which shall be due as
hereinbefore provided, and the late charge described in Subsection (b) below,
which shall be due when provided without notice or demand) to Landlord shall be
paid within ten (10) days after Landlord's demand therefor. All such amounts
(including Monthly Base Rent, Rent Adjustments, and Rent Adjustment Deposits,
but excluding the late charge) not paid when due shall bear interest from the
date due until the date paid at the Default Rate in effect on the date such
payment was due.

                                       23
<PAGE>

      (b) In the event Tenant is more than five (5) days late in paying any
installment of Rent due under this Lease, Tenant shall pay Landlord a late
charge equal to five percent (5%) of the delinquent installment of Rent. The
parties agree that (i) such delinquency will cause Landlord to incur costs and
expenses not contemplated herein, the exact amount of which will be difficult to
calculate, including the cost and expense that will be incurred by Landlord in
processing each delinquent payment of rent by Tenant, and (ii) the amount of
such late charge represents a reasonable estimate of such costs and expenses and
that such late charge shall be paid to Landlord for each delinquent payment in
addition to all Rent otherwise due hereunder. The parties further agree that the
payment of late charges and the payment of interest provided for in subparagraph
(a) above are distinct and separate from one another in that the payment of
interest is to compensate Landlord for its inability to use the money improperly
withheld by Tenant, while the payment of late charges is to compensate Landlord
for its additional administrative expenses in handling and processing delinquent
payments.

      (c) Payment of interest at the Default Rate and/or of late charges shall
not excuse or cure any default by Tenant under this Lease, nor shall the
foregoing provisions of this Article or any such payments prevent Landlord from
exercising any right or remedy available to Landlord upon Tenant's failure to
pay Rent when due, including the right to terminate this Lease.

26.02 NO JURY TRIAL; VENUE; JURISDICTION

Each party hereto (which includes any assignee, successor, heir or personal
representative of a party) shall not seek a jury trial, hereby waives trial by
jury, and hereby further waives any objection to venue in the County in which
the Project is located, and agrees and consents to personal jurisdiction of the
courts of the State of California, in any action or proceeding or counterclaim
brought by any party hereto against the other on any matter whatsoever arising
out of or in any way connected with this Lease, the relationship of Landlord and
Tenant, Tenant's use or occupancy of the Premises, or any claim of injury or
damage, or the enforcement of any remedy under any statute, emergency or
otherwise, whether any of the foregoing is based on this Lease or on tort law.
No party will seek to consolidate any such action in which a jury has been
waived with any other action in which a jury trial cannot or has not been
waived. It is the intention of the parties that these provisions shall be
subject to no exceptions. By execution of this Lease the parties agree that this
provision may be filed by any party hereto with the clerk or judge before whom
any action is instituted, which filing shall constitute the written consent to a
waiver of jury trial pursuant to and in accordance with Section 631 of the
California Code of Civil Procedure. No party has in any way agreed with or
represented to any other party that the provisions of this Section will not be
fully enforced in all instances. The provisions of this Section shall survive
the expiration or earlier termination of this Lease.

26.03 DEFAULT UNDER OTHER LEASE

It shall be a Default under this Lease if Tenant or any Affiliate holding any
other lease with Landlord for premises in the Project defaults under such lease
and as a result thereof such lease is terminated or terminable.

26.04 OPTION

This Lease shall not become effective as a lease or otherwise until executed and
delivered by both Landlord and Tenant. The submission of the Lease to Tenant
does not constitute a reservation of or option for the Premises, but when
executed by Tenant and delivered to Landlord, the Lease shall constitute an
irrevocable offer by Tenant in effect for fifteen (15) days to lease the
Premises on the terms and conditions herein contained.

26.05 TENANT AUTHORITY

Tenant represents and warrants to Landlord that it has full authority and power
to enter into and perform its obligations under this Lease, that the person
executing this Lease is fully empowered to do so, and that no consent or
authorization is necessary from any third party. Landlord may request that
Tenant provide Landlord evidence of Tenant's authority.

26.06 ENTIRE AGREEMENT

This Lease, the Exhibits and Rider(s) attached hereto contain the entire
agreement between Landlord and Tenant concerning the Premises and there are no
other agreements, either oral or written, and no other representations or
statements, either oral or written, on which Tenant has relied. This Lease shall
not be modified except by a writing executed by Landlord and Tenant.

26.07 MODIFICATION OF LEASE FOR BENEFIT OF MORTGAGEE

If Mortgagee of Landlord requires a modification of this Lease which shall not
result in any increased cost or expense to Tenant or in any other substantial
and adverse change in the rights and obligations of Tenant hereunder, then
Tenant agrees that the Lease may be so modified.

26.08 EXCULPATION

Tenant agrees, on its behalf and on behalf of its successors and assigns, that
any liability or obligation of Landlord in connection with this Lease shall only
be enforced against Landlord's equity interest in the Property up to a maximum
of Three Million Dollars ($3,000,000.00) and in no event against any other
assets of the Landlord, or Landlord's officers or directors or partners, and
that any liability of Landlord with respect to this Lease shall be so limited
and Tenant shall not be entitled to any judgment in excess of such amount.

                                       24
<PAGE>

26.09 ACCORD AND SATISFACTION

No payment by Tenant or receipt by Landlord of a lesser amount than any
installment or payment of Rent due shall be deemed to be other than on account
of the amount due, and no endorsement or statement on any check or any letter
accompanying any check or payment of Rent shall be deemed an accord and
satisfaction, and Landlord may accept such check or payment without prejudice to
Landlord's right to recover the balance of such installment or payment of Rent
or pursue any other remedies available to Landlord. No receipt of money by
Landlord from Tenant after the termination of this Lease or Tenant's right of
possession of the Premises shall reinstate, continue or extend the Term. Receipt
or acceptance of payment from anyone other than Tenant, including an assignee of
Tenant, is not a waiver of any breach of Article Ten, and Landlord may accept
such payment on account of the amount due without prejudice to Landlord's right
to pursue any remedies available to Landlord.

26.10 LANDLORD'S OBLIGATIONS ON SALE OF BUILDING

In the event of any sale or other transfer of the Building, Landlord shall be
entirely freed and relieved of all agreements and obligations of Landlord
hereunder accruing or to be performed after the date of such sale or transfer,
and any remaining liability of Landlord with respect to this Lease shall be
limited to Three Million Dollars ($3,000,000.00) and Tenant shall not be
entitled to any judgment in excess of such amount.

26.11 BINDING EFFECT

Subject to the provisions of Article Ten, this Lease shall be binding upon and
inure to the benefit of Landlord and Tenant and their respective heirs, legal
representatives, successors and permitted assigns.

26.12 CAPTIONS

The Article and Section captions in this Lease are inserted only as a matter of
convenience and in no way define, limit, construe, or describe the scope or
intent of such Articles and Sections.

26.13 TIME; APPLICABLE LAW; CONSTRUCTION

Time is of the essence of this Lease and each and all of its provisions. This
Lease shall be construed in accordance with the Laws of the State of California.
If more than one person signs this Lease as Tenant, the obligations hereunder
imposed shall be joint and several. If any term, covenant or condition of this
Lease or the application thereof to any person or circumstance shall, to any
extent, be invalid or unenforceable, the remainder of this Lease, or the
application of such term, covenant or condition to persons or circumstances
other than those as to which it is held invalid or unenforceable, shall not be
affected thereby and each item, covenant or condition of this Lease shall be
valid and be enforced to the fullest extent permitted by Law. Wherever the term
"including" or "includes" is used in this Lease, it shall have the same meaning
as if followed by the phrase "but not limited to". The language in all parts of
this Lease shall be construed according to its normal and usual meaning and not
strictly for or against either Landlord or Tenant.

26.14 ABANDONMENT

In the event Tenant vacates or abandons the Premises but is otherwise in
compliance with all the terms, covenants and conditions of this Lease, Landlord
shall (i) have the right to enter into the Premises in order to show the space
to prospective tenants, (ii) have the right to reduce the services provided to
Tenant pursuant to the terms of this Lease to such levels as Landlord reasonably
determines to be adequate services for an unoccupied premises and (iii) during
the last six (6) months of the Term, have the right to prepare the Premises for
occupancy by another tenant upon the end of the Term. Tenant expressly
acknowledges that in the absence of written notice pursuant to Section 11.02(b)
or pursuant to California Civil Code Section 1951.3 terminating Tenant's right
to possession, none of the foregoing acts of Landlord or any other act of
Landlord shall constitute a termination of Tenant's right to possession or an
acceptance of Tenant's surrender of the Premises, and the Lease shall continue
in effect.

26.15 LANDLORD'S RIGHT TO PERFORM TENANT'S DUTIES

If Tenant fails timely to perform any of its duties under this Lease, Landlord
shall have the right (but not the obligation), to perform such duty on behalf
and at the expense of Tenant without prior notice to Tenant, and all sums
expended or expenses incurred by Landlord in performing such duty shall be
deemed to be additional Rent under this Lease and shall be due and payable upon
demand by Landlord.

26.16 SECURITY SYSTEM

Landlord shall not be obligated to provide or maintain any security patrol or
security system. Landlord shall not be responsible for the quality of any such
patrol or system which may be provided hereunder or for damage or injury to
Tenant, its employees, invitees or others due to the failure, action or inaction
of such patrol or system.

26.17 NO LIGHT, AIR OR VIEW EASEMENTS

Any diminution or shutting off of light, air or view by any structure which may
be erected on lands of or adjacent to the Project shall in no way affect this
Lease or impose any liability on Landlord.

                                       25
<PAGE>

26.18 RECORDATION

Neither this Lease, nor any notice nor memorandum regarding the terms hereof,
shall be recorded by Tenant. Any such unauthorized recording shall be a Default
for which there shall be no cure or grace period. Tenant agrees to execute and
acknowledge, at the request of Landlord, a memorandum of this Lease, in
recordable form.

26.19 SURVIVAL

The waivers of the right of jury trial, the other waivers of claims or rights,
the releases and the obligations of Tenant under this Lease to indemnify,
protect, defend and hold harmless Landlord and/or Indemnitees shall survive the
expiration or termination of this Lease, and so shall all other obligations or
agreements which by their terms survive expiration or termination of the Lease.

26.20 RIDERS

All Riders attached hereto and executed both by Landlord and Tenant shall be
deemed to be a part hereof and hereby incorporated herein.

IN WITNESS WHEREOF, this Lease has been executed as of the date set forth in
Section 1.01(4) hereof.

TENANT:                                   LANDLORD:

BRE Properties, Inc.,                     Metropolitan Life Insurance Company,
a Maryland corporation                    a New York corporation

By  ____/s/ LeRoy Carlson_____________    By  _______/s/ Donald K. Devine_______

    ____LeRoy Carlson_________________        ______Donald K. Devine____________
          Print name                                  Print name
Its ____Executive Vice President______    Its ______Vice President______________
(Chairman of Board, President or
Vice President)

By  ________________________________

    ________________________________
          Print name

Its ________________________________
(Secretary, Assistant Secretary,
CFO or Assistant Treasurer)

                                       26
<PAGE>

                                    EXHIBIT A

                                PLAN OF PREMISES

                               Exhibit A - Page 1
<PAGE>

                                    EXHIBIT B

                              WORKLETTER AGREEMENT

                                   (Allowance)

      This Workletter Agreement ("Workletter") is attached to and a part of a
certain Office Lease dated as of April 24, 2000 executed concurrently herewith
by Metropolitan Life Insurance Company, a New York corporation, as Landlord, and
BRE Properties, Inc. a Maryland corporation, as Tenant, for the Premises as
described therein (the "Lease").

      1. Defined Terms. Capitalized terms used in this Workletter shall have the
same meanings set forth in the Lease except as otherwise specified herein and
except for terms capitalized in the ordinary course of punctuation. For purposes
of this Workletter the following capitalized terms have the following meanings:

      1.1. "Design Documents" means the layout plans and specifications for the
real property improvements to be constructed by Landlord in the Premises which
are the final product of the preliminary space planning and which (i) include,
among other things, all partitions, doors, HVAC (heating, ventilating and air
conditioning systems) distribution, ceiling systems, light fixtures, plumbing
installations, electrical installations and outlets, telephone installations and
outlets, any other installations required by Tenant, fire and life-safety
systems, wall finishes and floor coverings, whether to be newly installed or
requiring changes from the as-is condition of the Premises as of the date of
execution of the Lease, all in sufficient detail for Landlord to commence
preparation of the Construction Drawings (defined below); and (ii) comply with
all Law as applicable and as interpreted at the time of construction of the
Tenant Improvements (defined below), including all building codes and the ADA
(defined in the Lease);

      1.2 "Construction Drawings" means the final architectural plans and
specifications, and engineering plans and specifications, for the real property
improvements to be constructed by Landlord in the Premises in sufficient detail
to be submitted for governmental approvals and building permits and to serve as
the detailed construction drawings and specifications for the contractor, and
shall (i) include, among other things, all partitions, doors, HVAC (heating,
ventilating and air conditioning systems) distribution, ceiling systems, light
fixtures, plumbing installations, electrical installations and outlets,
telephone installations and outlets, any other installations required by Tenant,
fire and life-safety systems, wall finishes and floor coverings, whether to be
newly installed or requiring changes from the as-is condition of the Premises as
of the date of execution of the Lease; and (ii) comply with all Law as
applicable and as interpreted at the time of construction of the Tenant
Improvements (defined below), including all building codes and the ADA;

      1.3 "Tenant Improvements" means all real property improvements to be
constructed by Landlord as shown on the Construction Drawings, as they may be
modified as provided herein; and

      1.4 "Landlord Work" means the construction and installation of the Tenant
Improvements.

      2. Design Matters.

      2.1. Landlord, through its architects and/or space planners ("Landlord's
Architect"), shall prepare the Design Documents and the Construction Drawings,
as they may be modified as provided herein, in accordance with the design
specified by Tenant and reasonably approved by Landlord.

      2.2. Tenant shall be responsible for the suitability for the Tenant's
needs and business of the design and function of all Tenant Improvements.
Tenant, at its own expense, shall devote such time and provide such instructions
as may be necessary to enable Landlord to complete the matters described below,
and Tenant shall approve such matters, within the times described below:

            (a) to provide no later than May 15, 2000, all information necessary
or appropriate for Landlord's Architect to prepare the Design Documents; and

            (b) to provide Tenant's written approval of the Design Documents
within three (3) days after receipt of the proposed Design Documents; and

            (c) to provide Tenant's written approval of a nonbinding preliminary
estimate ("Landlord's Preliminary Estimate") provided by Landlord of the cost of
the Tenant Improvements shown on the Design Documents within three (3) days
after receipt of such estimate; and

            (d) to provide Tenant's written approval of the Construction
Drawings within three (3) days after receipt of the proposed Construction
Drawings.

      3. Construction; Landlord's Contribution; Tenant Improvement Costs.

      3.1. Construction; Landlord's Contribution. Landlord, through its
contractor, shall complete the construction of the Tenant Improvements in a good
and workmanlike manner, up to a maximum cost to Landlord of One Hundred
Twenty-five Thousand Three Hundred Forty Dollars ($125,340.00) ("Landlord's
Maximum Contribution").

      3.2. Tenant Improvement Costs. The cost of the Tenant Improvements
("Tenant Improvement Costs") to be paid by Landlord from, but not in excess of,
Landlord's Maximum Contribution shall include:

                               Exhibit B - Page 1
<PAGE>

            (a) The costs of Landlord's Architect and any other consultants
retained by Landlord in connection with the preparation of Design Documents and
Constructions Drawings, and engineering costs associated with completion of the
State of California energy utilization calculations under Title 24 legislation;

            (b) All costs of obtaining from the City of Walnut Creek and any
other governmental authority, approvals, building permits and occupancy permits,
if any;

            (c) All costs of interior design and finish schedule plans and
specifications including as-built drawings;

            (d) All direct and indirect costs of procuring, installing and
constructing the Tenant Improvements, including: (i) the construction fee for
overhead and profit and the cost of all on-site supervisory and administrative
staff, office, equipment and temporary services rendered or provided by
Landlord's contractor in connection with construction of the Tenant
Improvements; (ii) the cost of any services or utilities made available by
Landlord; and (iii) a construction management fee payable to Landlord;

            (e) Without limiting the generality of the foregoing, the Tenant
Improvement Costs include all costs of designing, procuring, constructing and
installing Tenant Improvements in compliance with Law as applicable and as
interpreted at the time of construction of the Tenant Improvements, including
with all building codes and the ADA; and

            (f) All fees payable to Landlord's architectural and engineering
firm if it is required by Tenant to redesign any portion of the Tenant
Improvements following Tenant's approval of the Construction Drawings, and all
costs in connection with any approved Change Order in accordance with the
provisions of this Workletter.

In no event shall the Tenant Improvement Costs include (i) any costs of
procuring or installing in the Premises any trade fixtures, equipment,
furniture, furnishings, telephone equipment, cabling for any of the foregoing,
or other personal property ("Personal Property") to be used in the Premises by
Tenant, and the cost of such Personal Property shall be paid by Tenant, or (ii)
any costs or expenses of any consultants retained by Tenant with respect to
design, procurement, installation or construction of improvements or
installations, whether real or personal property, for the Premises. Provided
however, in the event that (and only after) all other Tenant Improvement Costs
are paid, then Tenant may apply for and use any remaining unused Landlord's
Maximum Contribution up to a maximum of Thirty-one Thousand Three Hundred and
Fifty Dollars ($31,350.00) to reimburse Tenant for its actual, out-of-pocket
costs of procuring and installing telephone and data cabling in the Premises.

      3.3. Limitations of Landlord's Obligations. Upon Substantial Completion of
the Tenant Improvements, Landlord shall have no further obligation to construct
improvements or construct modifications to or changes in the Tenant
Improvements, except to complete the punchlist of Landlord Work remaining to be
completed or correct any part thereof not in compliance with the Construction
Drawings and any approved modifications thereof, as provided in the Lease. If
Landlord's Maximum Contribution exceeds the Tenant Improvement Costs, then
Landlord shall retain such excess and shall have no obligation or liability to
Tenant with respect to such excess.

      4. Costs of Tenant Improvements in Excess of Landlord's Maximum
Contribution. As soon as reasonably available after completion and approval by
both parties of the Construction Drawings, Landlord shall notify Tenant in
writing of the costs, if any, of the Tenant Improvements in excess of the
Landlord's Maximum Contribution (such notification shall be referred to as
"Landlord's Cost Statement"). Within five (5) days after receipt of Landlord's
Cost Statement, Tenant shall, in writing, give Landlord authorization to
complete the Tenant Improvements in accordance with the Construction Drawings,
and to the extent that there remain any costs of the Tenant Improvements in
excess of the Landlord's Maximum Contribution, Tenant shall accompany said
authorization with a good check made payable to the order of Landlord in the
amount of the excess cost authorized by Tenant of the Tenant Improvements over
Landlord's Maximum Contribution. In such authorization, Tenant may, pursuant to
the provisions of this Workletter, request a Change Order (defined below) to the
approved Construction Drawings to reduce or delete all or part of such excess
costs, but any delay in completion of the Premises resulting from such request
for a Change Order or from the changes so made or necessitated shall be
chargeable as Tenant Delay. If such written authorization and check (if
applicable) are not received by Landlord, Landlord shall not be obligated to
commence work on the Premises and any resulting delay in the completion of the
Premises shall be chargeable against Tenant as Tenant Delay as provided in
Section 6 of this Workletter and in the Lease.

      5. Changes. If Tenant shall request any change, addition or alteration in
the approved Construction Drawings, any such request and Change Order pursuant
thereto shall be subject to Landlord's approval, which shall not unreasonably be
withheld, and subject to such approval, Landlord shall promptly give Tenant a
written estimate of (a) the cost of engineering and design services and the
construction contractor services to prepare a change order (the "Change Order")
in accordance with such request, (b) the cost of work to be performed pursuant
to such Change Order, and (c) the time delay expected because of such requested
Change Order. Within three (3) business days following Tenant's receipt of the
foregoing written estimate, Tenant shall notify Landlord in writing whether it
approves such written estimate. If Tenant approves such written estimate and if
such cost is in excess of Landlord's Maximum Contribution, Tenant shall
accompany such approval with a good check made payable to the order of Landlord
in the amount of the estimated cost of preparing the Change Order and performing
the work thereto, and the foregoing shall constitute Landlord's authorization to
proceed. If such written authorization, and check if required, are not received
by Landlord within such three (3) business day period, Landlord shall not be
obligated to prepare the Change Order or perform any work in connection
therewith. Upon completion of the work of the Change Order and submission of the
final cost thereof by Landlord to Tenant, Tenant shall promptly pay to Landlord
any such additional amounts in excess of Landlord's Maximum Contribution.

      6. Tenant Delay. If the Substantial Completion of the Tenant Improvements
in the Premises is delayed due to Tenant Delay (defined in the Lease), then
Tenant shall be responsible for all costs and any expenses occasioned

                               Exhibit B - Page 2
<PAGE>

by such delay, including any costs and expenses attributable to increases in
labor or materials, and the provisions of Article Two of the Lease shall apply.

      7. Entry by Tenant. Tenant may, with Landlord's written consent, which
will not unreasonably be withheld, enter the Premises during construction and
prior to the Commencement Date for the Premises solely for the purpose of
installing Tenant's Personal Property (defined in Section 3.2 above) as long as
such entry will not interfere with the timely and orderly construction and
completion of the Premises. Tenant shall notify Landlord of its desired time(s)
of entry and shall submit for Landlord's approval the scope of the work to be
performed and the name(s) of the contractor(s) who will perform such work. Such
work and such contractors shall be subject to Landlord's approval in the same
manner as for work subject to Section 9.01(a) of the Lease. Such entry shall be
without payment of Base Monthly Rent or Rent Adjustments, but such entry and all
acts and omissions in connection with it are subject to and governed by all
other provisions of the Lease, including Tenant's indemnification obligations,
insurance obligations, obligations under Article Seven and the provisions of
Section 9.02.

      8. Force and Effect. The terms and conditions of this Workletter
supplement the Lease and shall be construed to be a part of the Lease and are
incorporated in the Lease. Without limiting the generality of the foregoing, any
default by any party hereunder shall have the same force and effect as a default
under the Lease. Should any inconsistency arise between this Workletter and the
Lease as to the specific matters which are the subject of this Workletter, the
terms and conditions of this Workletter shall control.

      IN WITNESS WHEREOF, the parties hereto have executed this Workletter as of
the date first set forth in the Lease.

TENANT:                                   LANDLORD:

BRE Properties, Inc.,                     Metropolitan Life Insurance Company,
a Maryland corporation                    a New York corporation

By  ____/s/ LeRoy Carlson_____________    By  _______/s/ Donald K. Devine_______

    ____LeRoy Carlson_________________        ______Donald K. Devine____________
          Print name                                  Print name
Its ____Executive Vice President______    Its ______Vice President______________
(Chairman of Board, President or
Vice President)

By  ________________________________

    ________________________________
          Print name

Its ________________________________
(Secretary, Assistant Secretary,
CFO or Assistant Treasurer)

                               Exhibit B - Page 3
<PAGE>

                                    EXHIBIT C

                              RULES AND REGULATIONS

1. No sidewalks, entrance, passages, courts, elevators, vestibules, stairways,
corridors or halls shall be obstructed or encumbered by Tenant or used for any
purpose other than ingress and egress to and from the Premises and if the
Premises are situated on the ground floor of the Project, Tenant shall further,
at Tenant's own expense, keep the sidewalks and curb directly in front of the
Premises clean and free from rubbish.

2. No awning or other projection shall be attached to the outside walls or
windows of the Project without the prior written consent of Landlord. No
curtains, blinds, shades, drapes or screens shall be attached to or hung in, or
used in connection with any window or door of the Premises, without the prior
written consent of Landlord. Such awnings, projections, curtains, blinds,
shades, drapes, screens and other fixtures must be of a quality, type, design,
color, material and general appearance approved by Landlord, and shall be
attached in the manner approved by Landlord. All lighting fixtures hung in
offices or spaces along the perimeter of the Premises must be of a quality,
type, design, bulb color, size and general appearance approved by Landlord.

3. No sign, advertisement, notice, lettering, decoration or other thing shall be
exhibited, inscribed, painted or affixed by Tenant on any part of the outside or
inside of the Premises or of the Project, without the prior written consent of
Landlord; provided however such prior written consent is not required for any
such thing inside the Premises and not visible from outside the Premises. In the
event of the violation of the foregoing by Tenant, Landlord may remove same
without any liability, and may charge the expense incurred by such removal to
Tenant.

4. The sashes, sash doors, skylights, windows and doors that reflect or admit
light or air into the halls, passageways or other public places in the Project
shall not be covered or obstructed by Tenant, nor shall any bottles, parcels or
other articles be placed on the window sills or in the public portions of the
Project.

5. No show cases or other articles shall be put in front of or affixed to any
part of the exterior of the Project, nor placed in public portions thereof
without the prior written consent of Landlord.

6. The water and wash closets and other plumbing fixtures shall not be used for
any purposes other than those for which they were constructed, and no sweepings,
rubbish, rags or other substances shall be thrown therein. All damages resulting
from any misuse of the fixtures shall be borne by Tenant to the extent that
Tenant or Tenant's agents, servants, employees, contractors, visitors or
licensees shall have caused the same.

7. Tenant shall not mark, paint, drill into or in any way deface any part of the
Premises or the Project. No boring, cutting or stringing of wires shall be
permitted, except with the prior written consent of Landlord, and as Landlord
may direct.

8. No animal or bird of any kind shall be brought into or kept in or about the
Premises or the Project, except seeing-eye dogs or other seeing-eye animals.

9. Prior to leaving the Premises for the day, Tenant shall draw or lower window
coverings and extinguish all lights.

10. Tenant shall not make, or permit to be made, any unseemly or disturbing
noises or disturb or interfere with occupants of the Project, or neighboring
buildings or premises, or those having business with them. Tenant shall not
throw anything out of the doors, windows or skylights or down the passageways.

11. Neither Tenant nor any of Tenant's agents, servants, employees, contractors,
visitors or licensees shall at any time bring or keep upon the Premises any
flammable, combustible or explosive fluid, chemical or substance, except if and
to the extent such substance is otherwise permitted under Section 7.01 of the
Lease.

12. No additional locks, bolts or mail slots of any kind shall be placed upon
any of the doors or windows by Tenant, nor shall any change be made in existing
locks or the mechanism thereof. Tenant must, upon the termination of the
tenancy, restore to Landlord all keys of stores, offices and toilet rooms,
either furnished to, or otherwise procured by Tenant, and in the event of the
loss of any keys so furnished, Tenant shall pay to Landlord the cost thereof.

13. All removals, or the carrying in or out of any safes, freight, furniture,
construction material, bulky matter or heavy equipment of any description must
take place during the hours which Landlord or its agent may determine from time
to time. Landlord reserves the right to prescribe the weight and position of all
safes, which must be placed upon two-inch thick plank strips to distribute the
weight. The moving of safes, freight, furniture, fixtures, bulky matter or heavy
equipment of any kind must be made upon previous notice to the Building Manager
and in a manner and at times prescribed by him, and the persons employed by
Tenant for such work are subject to Landlord's prior approval. Landlord reserves
the right to inspect all safes, freight or other bulky articles to be brought
into the Project and to exclude from the Project all safes, freight or other
bulky articles which violate any of these Rules and Regulations or the Lease of
which these Rules and Regulations are a part.

14. Tenant shall not purchase spring water, towels, janitorial or maintenance or
other like service from any company or persons not approved by Landlord.
Landlord shall approve a sufficient number of sources of such services to
provide Tenant with a reasonable selection, but only in such instances and to
such extent as Landlord in its judgment shall consider consistent with security
and proper operation of the Project.

15. Landlord shall have the right to prohibit any advertising or business
conducted by Tenant referring to the Project which, in Landlord's opinion, tends
to impair the reputation of the Project or its desirability as a first class
building for

                               Exhibit C - Page 1
<PAGE>

offices and/or commercial services and upon notice from Landlord, Tenant shall
refrain from or discontinue such advertising.

16. Landlord reserves the right to exclude from the Project between the hours of
6:00 p.m. and 8:00 a.m. Monday through Friday, after 1:00 p.m. on Saturdays and
at all hours Sundays and legal holidays, all persons who do not present a pass
to the Project issued by Landlord. Landlord may furnish passes to Tenant so that
Tenant may validate and issue same. Tenant shall safeguard said passes and shall
be responsible for all acts of persons in or about the Project who possess a
pass issued to Tenant.

17. Tenant's contractors shall, while in the Premises or elsewhere in the
Project, be subject to and under the control and direction of the Building
Manager (but not as agent or servant of said Building Manager or of Landlord).

18. If the Premises is or becomes infested with vermin as a result of the use or
any misuse or neglect of the Premises by Tenant, its agents, servants,
employees, contractors, visitors or licensees, Tenant shall forthwith at
Tenant's expense cause the same to be exterminated from time to time to the
satisfaction of Landlord and shall employ such licensed exterminators as shall
be approved in writing in advance by Landlord.

19. The requirements of Tenant will be attended to only upon application at the
office of the Project. Project personnel shall not perform any work or do
anything outside of their regular duties unless under special instructions from
the office of the Landlord.

20. Canvassing, soliciting and peddling in the Project are prohibited and Tenant
shall cooperate to prevent the same.

21. No water cooler, air conditioning unit or system or other apparatus shall be
installed or used by Tenant without the written consent of Landlord.

22. There shall not be used in any premises, or in the public halls, plaza
areas, lobbies, or elsewhere in the Project, either by Tenant or by jobbers or
others, in the delivery or receipt of merchandise, any hand trucks or dollies,
except those equipped with rubber tires and sideguards.

23. Tenant, Tenant's agents, servants, employees, contractors, licensees, or
visitors shall not park any vehicles in any driveways, service entrances, or
areas posted "No Parking" and shall comply with any other parking restrictions
imposed by Landlord from time to time.

24. Tenant shall install and maintain, at Tenant's sole cost and expense, an
adequate visibly marked (at all times properly operational) fire extinguisher
next to any duplicating or photocopying machine or similar heat producing
equipment, which may or may not contain combustible material, in the Premises.

25. Tenant shall keep its window coverings closed during any period of the day
when the sun is shining directly on the windows of the Premises.

26. Tenant shall not use the name of the Project for any purpose other than as
the address of the business to be conducted by Tenant in the Premises, nor shall
Tenant use any picture of the Project in its advertising, stationery or in any
other manner without the prior written permission of Landlord. Landlord
expressly reserves the right at any time to change said name without in any
manner being liable to Tenant therefor.

27. Tenant shall not prepare any food nor do any cooking, operate or conduct any
restaurant, luncheonette or cafeteria for the sale or service of food or
beverages to its employees or to others, except that food and beverage
preparation by Tenant's employees using microwave ovens or coffee makers shall
be permitted provided no odors of cooking or other processes emanate from the
Premises. Tenant shall not install or permit the installation or use of any
vending machine or permit the delivery of any food or beverage to the Premises
except by such persons and in such manner as are approved in advance in writing
by Landlord.

28. The Premises shall not be used as an employment agency, a public
stenographer or typist, a labor union office, a physician's or dentist's office,
a dance or music studio, a school, a beauty salon, or barber shop, the business
of photographic, multilith or multigraph reproductions or offset printing (not
precluding using any part of the Premises for photographic, multilith or
multigraph reproductions solely in connection with Tenant's own business and/or
activities), a restaurant or bar, an establishment for the sale of
confectionery, soda, beverages, sandwiches, ice cream or baked goods, an
establishment for preparing, dispensing or consumption of food or beverages of
any kind in any manner whatsoever, or news or cigar stand, or a radio,
television or recording studio, theater or exhibition-hall, or manufacturing, or
the storage or sale of merchandise, goods, services or property of any kind at
wholesale, retail or auction, or for lodging, sleeping or for any immoral
purposes.

29. Business machines and mechanical equipment shall be placed and maintained by
Tenant at Tenant's expense in settings sufficient in Landlord's judgment to
absorb and prevent vibration, noise and annoyance. Tenant shall not install any
machine or equipment which causes noise, heat, cold or vibration to be
transmitted to the structure of the building in which the Premises are located
without Landlord's prior written consent, which consent may be conditioned on
such terms as Landlord may require. Tenant shall not place a load upon any floor
of the Premises exceeding the floor load per square foot which such floor was
designed to carry and which is allowed by Law.

30. Tenant shall not bring any Hazardous Materials onto the Premises except for
those which are in general commercial use and are incidental to Tenant's
business office operations and only in quantities suitable for immediate use.

                               Exhibit C - Page 2
<PAGE>

31. Tenant shall not store any vehicle within the parking facility. Tenant's
parking rights are limited to the use of parking spaces for short-term parking,
of up to twenty-four (24) hours, of vehicles utilized in the normal and regular
daily travel to and from the Project. Tenants who wish to park a vehicle for
longer than a 24-hour period shall notify the Building Manager for the Project
and consent to such long-term parking may be granted for periods up to two (2)
weeks. Any motor vehicles parked without the prior written consent of the
Building Manager for the Project for longer than a 24-hour period shall be
deemed stored in violation of this rule and regulation and shall be towed away
and stored at the owner's expense or disposed of as provided by Law.

32. Smoking is prohibited in the Premises, the Building and all enclosed Common
Areas of the Project, including all lobbies, all hallways, all elevators, all
lavatories and the parking structure.

                               Exhibit C - Page 3
<PAGE>

                                     RIDER 1
                           COMMENCEMENT DATE AGREEMENT

Metropolitan Life Insurance Company, a New York corporation ("Landlord"), and
BRE Properties, Inc., a Maryland corporation ("Tenant"), have entered into a
certain Office Lease dated as of April 24, 2000 (the "Lease").

WHEREAS, Landlord and Tenant wish to confirm and memorialize the Commencement
Date and Expiration Date of the Lease as provided for in Section 2.02(b) of the
Lease;

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein and in the Lease, Landlord and Tenant agree as follows:

      1. Unless otherwise defined herein, all capitalized terms shall have the
same meaning ascribed to them in the Lease.

      2. The Commencement Date (as defined in the Lease) of the Lease is ______.

      3. The Expiration Date (as defined in the Lease) of the Lease is _______.

      4. Tenant hereby confirms the following:

            (a)   That it has accepted possession of the premises pursuant to
                  the terms of the Lease;

            (b)   That the Landlord Work is Substantially Complete; and

            (c)   That the Lease is in full force and effect.

      5. Except as expressly modified hereby, all terms and provisions of the
Lease are hereby ratified and confirmed and shall remain in full force and
effect and binding on the parties hereto.

      6. The Lease and this Commencement Date Agreement contain all of the
terms, covenants, conditions and agreements between the Landlord and the Tenant
relating to the subject matter herein. No prior other agreements or
understandings pertaining to such matters are valid or of any force and effect.

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Commencement
Date Agreement and such execution and delivery have been duly authorized.

TENANT:                             LANDLORD:

BRE Properties, Inc.,                     Metropolitan Life Insurance Company,

a Maryland corporation                    a New York corporation

By  ________________________________      By  ________________________________

    ________________________________          ________________________________
             Print name                                  Print name

Its _________________________________     Its _________________________________
(Chairman of Board, President or
Vice President)

By  ________________________________

    ________________________________
          Print name

Its ________________________________
(Secretary, Assistant Secretary,
CFO or Assistant Treasurer)

                                Rider 1 - Page 1
<PAGE>

                                     RIDER 2
                              ADDITIONAL PROVISIONS

      This Rider 2 ("Rider 2") is attached to and a part of a certain Office
Lease dated as of April 24, 2000 executed concurrently herewith by Metropolitan
Life Insurance Company, a New York corporation, as Landlord, and BRE Properties,
Inc., a Maryland corporation (for purposes of Rider 2, "BRE"), as Tenant, for
the Premises as described therein (the "Lease").

SECTION 1. DEFINED TERMS; FORCE AND EFFECT

Capitalized terms used in this Rider 2 shall have the same meanings set forth in
the Lease except as otherwise specified herein and except for terms capitalized
in the ordinary course of punctuation. This Rider 2 forms a part of the Lease.
Should any inconsistency arise between this Rider 2 and any other provision of
the Lease as to the specific matters which are the subject of this Rider 2, the
terms and conditions of this Rider 2 shall control.

SECTION 2. CONDITION PRECEDENT TO LEASE.

This Lease and the obligations of each party hereunder are expressly subject to
the condition precedent of Landlord successfully entering into and obtaining a
legally binding written agreement and/or new lease for relocation space with the
existing occupant ("Occupant") of part of the space which will be the Premises
hereunder providing for Occupant's surrender of possession of such space and/or
relocation satisfactory in all respects in form and substance to Landlord, in
Landlord's sole discretion (the "Surrender Agreement"). If such condition
precedent is not satisfied or waived in writing by Landlord in its sole
discretion, this Lease shall be null and void, and of no force or effect.
Landlord shall give Tenant notice of the satisfaction of this condition
precedent, which notice may be given in writing to Tenant or Tenant's Broker.

SECTION 3. OPTION TO EXTEND.

      (a) Landlord hereby grants Tenant a single option to extend the initial
Term of the Lease for an additional period of five (5) years (such period may be
referred to as the "Option Term"), as to the entire Premises as it may then
exist, upon and subject to the terms and conditions of this Section (the "Option
To Extend"), and provided that at the time of exercise of such right: (i) Tenant
must be in occupancy of the entire Premises; and (ii) there has been no material
adverse change in Tenant's financial position from such position as of the date
of execution of the Lease, as certified by Tenant's independent certified public
accountants, and as supported by Tenant's certified financial statements, copies
of which shall be delivered to Landlord with Tenant's written notice exercising
its right hereunder.

      (b) Tenant's election (the "Election Notice") to exercise the Option To
Extend must be given to Landlord in writing no earlier than the date which is
twelve (12) months before the Expiration Date and no later than the date which
is nine (9) months prior to the Expiration Date. If Tenant either fails or
elects not to exercise its Option to Extend by not timely giving its Election
Notice, then the Option to Extend shall be null and void.

      (c) The Option Term shall commence immediately after the expiration of the
initial Term of the Lease. Tenant's leasing of the Premises during the Option
Term shall be upon and subject to the same terms and conditions contained in the
Lease except that (i) the Monthly Base Rent and, if applicable, the Operating
Expenses Base Year, the Taxes Base Year and parking charges pursuant to the
Lease shall be amended to equal the "Option Term Rent", defined and determined
in the manner set forth in the immediately following Subsection; (ii) the
Security Deposit, if any, shall be increased within fifteen (15) days after the
Prevailing Market Rent has been determined to equal one hundred percent (100%)
of the highest monthly installment of Monthly Base Rent thereunder; (iii) Tenant
shall accept the Premises in its "as is" condition without any obligation of
Landlord to repaint, remodel, repair, improve or alter the Premises or to
provide Tenant any allowance therefor; and (iv) there shall be no further option
or right to extend the term of the Lease. If Tenant timely and properly
exercises the Option To Extend, references in
<PAGE>

the Lease to the Term shall be deemed to mean the initial Term as extended by
the Option Term unless the context clearly requires otherwise.

      (d) The Option Term Rent shall mean the greater of (i) the Monthly Base
Rent and parking charges payable by Tenant under this Lease calculated at the
rate applicable for the last full month of the initial Term, with Rent
Adjustments based upon the Operating Expenses Base Year and Taxes Base Year as
defined in Section 1.03 (collectively, "Preceding Rent") or (ii) the "Prevailing
Market Rent". As used herein Prevailing Market Rent shall mean the rent and all
other monetary payments and escalations, including consumer price increases,
that Landlord could obtain from a third party desiring to lease the Premises for
a term equal to the Option Term and commencing when the Option Term is to
commence under market leasing conditions, and taking into account the following:
the size, location and floor levels of the Premises; the type and quality of
tenant improvements; age and location of the Project; quality of construction of
the Project; services to be provided by Landlord or by tenant; the rent, all
other monetary payments and escalations obtainable for new leases of space
comparable to the Premises in the Project and in comparable class A office
buildings in downtown Walnut Creek, California, and other factors that would be
relevant to such a third party in determining what such party would be willing
to pay therefor, provided, however, that Prevailing Market Rent shall be
determined without reduction or adjustment for "Tenant Concessions" (as defined
below), if any, being offered to prospective new tenants of comparable space.
For purposes of the preceding sentence, the term "Tenant Concessions" shall
include, without limitation, so-called free rent, tenant improvement allowances
and work, moving allowances, and lease takeovers. The determination of
Prevailing Market Rent based upon the foregoing criteria shall be made by
Landlord, in the good faith exercise of Landlord's business judgment. Within
thirty (30) days after Tenant's exercise of the Option To Extend, Landlord shall
notify Tenant of Landlord's determination of Option Term Rent for the Premises.
If Landlord's determination of Prevailing Market Rent is greater than the
Preceding Rent, and if Tenant, in Tenant's sole discretion, disagrees with the
amount of Prevailing Market Rent determined by Landlord, Tenant may elect to
revoke and rescind the exercise of the option by giving written notice thereof
to Landlord within thirty (30) days after notice of Landlord's determination of
Prevailing Market Rent.

      (e) This Option to Extend is personal to BRE and may not be used by, and
shall not be transferable or assignable (voluntarily or involuntarily) to any
person or entity.

      (f) Upon the occurrence of any of the following events, Landlord shall
have the option, exercisable at any time prior to commencement of the Option
Term, to terminate all of the provisions of this Section with respect to the
Option to Extend, with the effect of canceling and voiding any prior or
subsequent exercise so this Option to Extend is of no force or effect:

            (i) Tenant's failure to timely exercise the Option to Extend in
      accordance with the provisions of this Section.

            (ii) The existence at the time Tenant exercises the Option to Extend
      or at the commencement of the Option Term of any default on the part of
      Tenant under the Lease or of any state of facts which with the passage of
      time or the giving of notice, or both, would constitute such a default.

            (iii) Tenant's third default under the Lease prior to the
      commencement of the Option Term, notwithstanding that all such defaults
      may subsequently be cured.

In the event of Landlord's termination of the Option to Extend pursuant to this
Section, Tenant shall reimburse Landlord for all costs and expenses Landlord
incurs in connection with Tenant's exercise of the Option to Extend including,
without limitation, costs and expenses with respect to any brokerage commissions
and attorneys' fees, and with respect to the design, construction or making of
any tenant improvements, repairs or renovation or with respect to any payment of
all or part of any allowance for any of the foregoing.

                                Rider 1 - Page 2
<PAGE>

      (g) Without limiting the generality of any provision of the Lease, time
shall be of the essence with respect to all of the provisions of this Section.

      IN WITNESS WHEREOF, the parties hereto have executed this Rider 2 as of
the date first set forth in the Lease.

TENANT:                                   LANDLORD:

BRE Properties, Inc.,                     Metropolitan Life Insurance Company,
a Maryland corporation                    a New York corporation

By  ____/s/ LeRoy Carlson_____________    By  _______/s/ Donald K. Devine_______

    ____LeRoy Carlson_________________        ______Donald K. Devine____________
          Print name                                  Print name
Its ____Executive Vice President______    Its ______Vice President______________
(Chairman of Board, President or
Vice President)

By  ________________________________

    ________________________________
          Print name

Its ________________________________
(Secretary, Assistant Secretary,
CFO or Assistant Treasurer)

                                Rider 1 - Page 3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00024-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00024-of-00352.parquet"}]]