Document:

Exhibit 4.1

                              GEORGIA POWER COMPANY

                                       TO

                              JPMORGAN CHASE BANK,
                                     TRUSTEE

                        EIGHTEENTH SUPPLEMENTAL INDENTURE

                          DATED AS OF OCTOBER 23, 2003

                            SERIES R 6% SENIOR NOTES

                              DUE OCTOBER 15, 2033

<PAGE>

                               TABLE OF CONTENTS1

                                                                     PAGE

                         ARTICLE 1
SECTION 101.  Establishment............................................1
              -------------
SECTION 102.  Definitions..............................................2
              -----------
SECTION 103.  Payment of Principal and Interest........................2
              ---------------------------------
SECTION 104.  Denominations............................................3
              -------------
SECTION 105.  Global Securities........................................3
              -----------------
SECTION 106.  Transfer.................................................4
              --------
SECTION 107.  Redemption at the Company's Option.......................4
              ----------------------------------

                         ARTICLE 2
SECTION 201.  Recitals by Company......................................4
              -------------------
SECTION 202.  Ratification  and  Incorporation of Original
              ---------------------------------------------
              Indenture................................................5
              ---------
SECTION 203.  Executed in Counterparts.................................5
              ------------------------

___________________

1This Table of Contents does not constitute part of the Indenture or have any
bearing upon the interpretation of any of its terms and provisions.

<PAGE>

     THIS EIGHTEENTH SUPPLEMENTAL INDENTURE is made as of the 23rd day of
October, 2003, by and between GEORGIA POWER COMPANY, a Georgia corporation, 241
Ralph McGill Boulevard, N.E., Atlanta, Georgia 30308-3374 (the "Company"), and
JPMORGAN CHASE BANK, a New York banking corporation, 4 New York Plaza, New York,
New York 10004 (the "Trustee").

                              W I T N E S S E T H:

     WHEREAS, the Company has heretofore entered into a Senior Note Indenture,
dated as of January 1, 1998 (the "Original Indenture"), with JPMorgan Chase Bank
(formerly known as The Chase Manhattan Bank), as heretofore supplemented;

     WHEREAS, the Original Indenture is incorporated herein by this reference
and the Original Indenture, as heretofore supplemented and as further
supplemented by this Eighteenth Supplemental Indenture, is herein called the
"Indenture";

     WHEREAS, under the Original Indenture, a new series of Senior Notes may at
any time be established by the Board of Directors of the Company in accordance
with the provisions of the Original Indenture and the terms of such series may
be described by a supplemental indenture executed by the Company and the
Trustee;

     WHEREAS, the Company proposes to create under the Indenture a new series of
Senior Notes;

     WHEREAS, additional Senior Notes of other series hereafter established,
except as may be limited in the Original Indenture as at the time supplemented
and modified, may be issued from time to time pursuant to the Indenture as at
the time supplemented and modified; and

     WHEREAS, all conditions necessary to authorize the execution and delivery
of this Eighteenth Supplemental Indenture and to make it a valid and binding
obligation of the Company have been done or performed.

     NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties hereto hereby agree as follows:

                                    ARTICLE 1

                              Series R Senior Notes

     SECTION 101. Establishment. There is hereby established a new series of
Senior Notes to be issued under the Indenture, to be designated as the Company's
Series R 6% Senior Notes due October 15, 2033 (the "Series R Notes").

     There are to be authenticated and delivered $200,000,000 principal amount
of Series R Notes, and such principal amount of the Series R Notes may be
increased from time to time pursuant to Section 301 of the Original Indenture.
All Series R Notes need not be issued at the same time and such series may be
reopened at any time, without the consent of any Holder, for issuances of
additional Series R Notes. Any such additional Series R Notes will have the same
interest rate, maturity and other terms as those initially issued. No Series R
Notes shall be authenticated and delivered in excess of the principal amount as
so increased except as provided by Sections 203, 303, 304, 907 or 1107 of the
Original Indenture. The Series R Notes shall be issued in definitive fully
registered form.

     The Series R Notes shall be issued in the form of one or more Global
Securities in substantially the form set out in Exhibit A hereto. The Depositary
with respect to the Series R Notes shall be The Depository Trust Company.

     The form of the Trustee's Certificate of Authentication for the Series R
Notes shall be in substantially the form set forth in Exhibit B hereto.

     Each Series R Note shall be dated the date of authentication thereof and
shall bear interest from the date of original issuance thereof or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for.

     SECTION 102. Definitions. The following defined terms used herein shall,
unless the context otherwise requires, have the meanings specified below.
Capitalized terms used herein for which no definition is provided herein shall
have the meanings set forth in the Original Indenture.

     "Interest Payment Dates" means January 15, April 15, July 15 and October 15
of each year, commencing on January 15, 2004.

     "Original Issue Date" means October 23, 2003.

     "Regular Record Date" means, with respect to each Interest Payment Date,
the close of business on the 15th calendar day preceding such Interest Payment
Date (whether or not a Business Day).

     "Stated Maturity" means October 15, 2033.

     SECTION 103. Payment of Principal and Interest. The principal of the Series
R Notes shall be due at Stated Maturity (unless earlier redeemed). The unpaid
principal amount of the Series R Notes shall bear interest at the rate of 6% per
annum until paid or duly provided for. Interest shall be paid quarterly in
arrears on each Interest Payment Date to the Person in whose name the Series R
Notes are registered on the Regular Record Date for such Interest Payment Date,
provided that interest payable at the Stated Maturity of principal or on a
Redemption Date as provided herein will be paid to the Person to whom principal
is payable. Any such interest that is not so punctually paid or duly provided
for will forthwith cease to be payable to the Holders on such Regular Record
Date and may either be paid to the Person or Persons in whose name the Series R
Notes are registered at the close of business on a Special Record Date for the
payment of such defaulted interest to be fixed by the Trustee, notice whereof
shall be given to Holders of the Series R Notes not less than ten (10) days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange, if
any, on which the Series R Notes shall be listed, and upon such notice as may be
required by any such exchange, all as more fully provided in the Original
Indenture.

     Payments of interest on the Series R Notes will include interest accrued to
but excluding the respective Interest Payment Dates. Interest payments for the
Series R Notes shall be computed and paid on the basis of a 360-day year of
twelve 30-day months. In the event that any date on which interest is payable on
the Series R Notes is not a Business Day, then a payment of the interest payable
on such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay), with the
same force and effect as if made on the date the payment was originally payable.

     Payment of the principal and interest due at the Stated Maturity or earlier
redemption of the Series R Notes shall be made upon surrender of the Series R
Notes at the Corporate Trust Office of the Trustee. The principal of and
interest on the Series R Notes shall be paid in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts. Payments of interest (including interest on any
Interest Payment Date) will be made, subject to such surrender where applicable,
at the option of the Company, (i) by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register or (ii)
by wire transfer at such place and to such account at a banking institution in
the United States as may be designated in writing to the Trustee at least
sixteen (16) days prior to the date for payment by the Person entitled thereto.

     SECTION 104. Denominations. The Series R Notes may be issued in the
denominations of $25, or any integral multiple thereof.

     SECTION 105. Global Securities. The Series R Notes will be issued in the
form of one or more Global Securities registered in the name of the Depositary
(which shall be The Depository Trust Company) or its nominee. Except under the
limited circumstances described below, Series R Notes represented by one or more
Global Securities will not be exchangeable for, and will not otherwise be
issuable as, Series R Notes in definitive form. The Global Securities described
above may not be transferred except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or to a successor Depositary or its nominee.

     Owners of beneficial interests in such a Global Security will not be
considered the Holders thereof for any purpose under the Indenture, and no
Global Security representing a Series R Note shall be exchangeable, except for
another Global Security of like denomination and tenor to be registered in the
name of the Depositary or its nominee or to a successor Depositary or its
nominee. The rights of Holders of such Global Security shall be exercised only
through the Depositary.

     A Global Security shall be exchangeable for Series R Notes registered in
the names of persons other than the Depositary or its nominee only if (i) the
Depositary notifies the Company that it is unwilling or unable to continue as a
Depositary for such Global Security and no successor Depositary shall have been
appointed by the Company, or if at any time the Depositary ceases to be a
clearing agency registered under the Securities Exchange Act of 1934, as
amended, at a time when the Depositary is required to be so registered to act as
such Depositary and no successor Depositary shall have been appointed by the
Company, in each case within 90 days after the Company receives such notice or
becomes aware of such cessation, (ii) the Company in its sole discretion
determines that such Global Security shall be so exchangeable, or (iii) there
shall have occurred an Event of Default with respect to the Series R Notes. Any
Global Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Series R Notes registered in such names as the Depositary shall
direct.

     SECTION 106. Transfer. No service charge will be made for any transfer or
exchange of Series R Notes, but payment will be required of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
therewith.

     The Company shall not be required (a) to issue, transfer or exchange any
Series R Notes during a period beginning at the opening of business fifteen (15)
days before the date of the mailing of a notice pursuant to Section 1104 of the
Original Indenture identifying the serial numbers of the Series R Notes to be
called for redemption, and ending at the close of business on the day of the
mailing, or (b) to transfer or exchange any Series R Notes theretofore selected
for redemption in whole or in part, except the unredeemed portion of any Series
R Notes redeemed in part.

     SECTION 107. Redemption at the Company's Option. The Series R Notes shall
be subject to redemption at the option of the Company in whole or in part,
without premium or penalty, at any time or from time to time on or after October
23, 2008, at a Redemption Price equal to 100% of the principal amount of the
Series R Notes to be redeemed plus accrued but unpaid interest on the Series R
Notes to the Redemption Date.

     In the event of redemption of the Series R Notes in part only, a new Series
R Note or Notes for the unredeemed portion will be issued in the name or names
of the Holders thereof upon the surrender thereof.

     The Series R Notes will not have a sinking fund.

     Notice of redemption shall be given as provided in Section 1104 of the
Original Indenture.

     Any redemption of less than all of the Series R Notes shall, with respect
to the principal thereof, be divisible by $25.

                                    ARTICLE 2

                            Miscellaneous Provisions

     SECTION 201. Recitals by Company. The recitals in this Eighteenth
Supplemental Indenture are made by the Company only and not by the Trustee, and
all of the provisions contained in the Original Indenture in respect of the
rights, privileges, immunities, powers and duties of the Trustee shall be
applicable in respect of Series R Notes and of this Eighteenth Supplemental
Indenture as fully and with like effect as if set forth herein in full.

     SECTION 202. Ratification and Incorporation of Original Indenture. As
heretofore supplemented and as supplemented hereby, the Original Indenture is in
all respects ratified and confirmed, and the Original Indenture as heretofore
supplemented and as supplemented by this Eighteenth Supplemental Indenture shall
be read, taken and construed as one and the same instrument.

     SECTION 203. Executed in Counterparts. This Eighteenth Supplemental
Indenture may be simultaneously executed in several counterparts, each of which
shall be deemed to be an original, and such counterparts shall together
constitute but one and the same instrument.

<PAGE>

     IN WITNESS WHEREOF, each party hereto has caused this instrument to be
signed in its name and behalf by its duly authorized officers, all as of the day
and year first above written.

ATTEST:                          GEORGIA POWER COMPANY

By:                             By:
   --------------------------      --------------------------------------
      Wayne Boston                      C.B. Harreld
      Assistant Secretary               Executive Vice President, Treasurer
                                        and Chief Financial Officer

ATTEST:                          JPMORGAN CHASE BANK, as Trustee

By:                            By:
   -------------------------      ---------------------------------------------
      Nicholas Sberlati                Carol Ng
       Trust Officer                   Vice President

<PAGE>

                                    EXHIBIT A

                              FORM OF SERIES R NOTE

<PAGE>

NO. ___                                                   CUSIP NO. 373334 52 3

                              GEORGIA POWER COMPANY
                             SERIES R 6% SENIOR NOTE
                              DUE OCTOBER 15, 2033

Principal Amount:        $__________________

Regular Record Date:     15th  calendar day prior to Interest  Payment  Date
                         (whether or not a Business Day)

Original Issue Date:     October 23, 2003

Stated Maturity:         October 15, 2033

Interest Payment Dates:  January 15, April 15, July 15 and October 15

Interest Rate:           6% per annum

Authorized Denomination: $25, or any integral multiple thereof

Initial Redemption Date: October 23, 2008

         Georgia Power Company, a Georgia corporation (the "Company", which term
includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to __________, or
registered assigns, the principal sum of ______________ DOLLARS ($__________) on
the Stated Maturity shown above (or upon earlier redemption), and to pay
interest thereon from the Original Issue Date shown above, or from the most
recent Interest Payment Date to which interest has been paid or duly provided
for, quarterly in arrears on each Interest Payment Date as specified above,
commencing January 15, 2004 and on the Stated Maturity (or upon earlier
redemption) at the rate per annum shown above until the principal hereof is paid
or made available for payment and on any overdue principal and on any overdue
installment of interest. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date (other than an Interest Payment Date
that is the Stated Maturity or on a Redemption Date) will, as provided in such
Indenture, be paid to the Person in whose name this Note (the "Note") is
registered at the close of business on the Regular Record Date as specified
above next preceding such Interest Payment Date, provided that any interest
payable at the Stated Maturity or on any Redemption Date will be paid to the
Person to whom principal is payable. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Note is registered at the close
of business on a Special Record Date for the payment of such defaulted interest
to be fixed by the Trustee, notice whereof shall be given to Holders of Notes of
this series not less than 10 days prior to such Special Record Date, or be paid
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange, if any, on which the Notes of this series shall be
listed, and upon such notice as may be required by any such exchange, all as
more fully provided in the Indenture.

         Payments of interest on this Note will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for this Note
shall be computed and paid on the basis of a 360-day year of twelve 30-day
months. In the event that any date on which interest is payable on this Note is
not a Business Day, then payment of the interest payable on such date will be
made on the next succeeding day that is a Business Day (and without any interest
or other payment in respect of any such delay), with the same force and effect
as if made on the date the payment was originally payable. A "Business Day"
shall mean any day other than a Saturday or a Sunday or a day on which banking
institutions in New York City are authorized or required by law or executive
order to remain closed or a day on which the Corporate Trust Office of the
Trustee is closed for business.

         Payment of the principal of and interest due at the Stated Maturity or
earlier redemption of the Series R Notes shall be made upon surrender of the
Series R Notes at the Corporate Trust Office of the Trustee. The principal of
and interest on the Series R Notes shall be paid in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts. Payment of interest (including interest on an
Interest Payment Date) will be made, subject to such surrender where applicable,
at the option of the Company, (i) by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register or (ii)
by wire transfer at such place and to such account at a banking institution in
the United States as may be designated in writing to the Trustee at least 16
days prior to the date for payment by the Person entitled thereto.

         REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES
HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.

         Unless the certificate of authentication hereon has been executed by
the Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.

<PAGE>

         IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.

Dated:

                                       GEORGIA POWER COMPANY

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

Attest:

Title:

                  {Seal of GEORGIA POWER COMPANY appears here}

<PAGE>

                          CERTIFICATE OF AUTHENTICATION

         This is one of the Senior Notes referred to in the within-mentioned
Indenture.

                                JPMORGAN CHASE BANK,
                                as Trustee

                                By:
                                   --------------------------------------------
                                         Authorized Officer

<PAGE>

                             (Reverse Side of Note)

         This Note is one of a duly authorized issue of Senior Notes of the
Company (the "Notes"), issued and issuable in one or more series under a Senior
Note Indenture, dated as of January 1, 1998, as supplemented (the "Indenture"),
between the Company and JPMorgan Chase Bank (formerly known as The Chase
Manhattan Bank), as Trustee (the "Trustee," which term includes any successor
trustee under the Indenture), to which Indenture and all indentures incidental
thereto reference is hereby made for a statement of the respective rights,
limitation of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Notes issued thereunder and of the terms upon
which said Notes are, and are to be, authenticated and delivered. This Note is
one of the series designated on the face hereof as Series R 6% Senior Notes due
October 15, 2033 (the "Series R Notes") which is unlimited in aggregate
principal amount. Capitalized terms used herein for which no definition is
provided herein shall have the meanings set forth in the Indenture.

         The Company shall have the right, subject to the terms and conditions
of the Indenture, to redeem this Note at any time on or after October 23, 2008
at the option of the Company, without premium or penalty, in whole or in part,
at a Redemption Price equal to 100% of the principal amount to be redeemed plus
accrued but unpaid interest to the Redemption Date.

         In the event of redemption of this Note in part only, a new Note or
Notes of this series for the unredeemed portion hereof will be issued in the
name of the Holder hereof upon the surrender hereof. The Notes will not have a
sinking fund.

         If an Event of Default with respect to the Notes of this series shall
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.

         The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of not less than a majority in principal amount of the Notes at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Notes of each series at the time Outstanding, on behalf of the Holders of
all Notes of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.

         No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.

         As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable in the Security Register,
upon surrender of this Note for registration of transfer at the office or agency
of the Company for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar and duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes of this series, of
authorized denominations and of like tenor and for the same aggregate principal
amount, will be issued to the designated transferee or transferees. No service
charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.

         Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.

         The Notes of this series are issuable only in registered form without
coupons in denominations of $25 and any integral multiple thereof. As provided
in the Indenture and subject to certain limitations therein set forth, Notes of
this series are exchangeable for a like aggregate principal amount of Notes of
this series of a different authorized denomination, as requested by the Holder
surrendering the same upon surrender of the Note or Notes to be exchanged at the
office or agency of the Company.

         This Note shall be governed by, and construed in accordance with, the
internal laws of the State of New York.

<PAGE>

                                  ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

<PAGE>

TEN COM- as tenants in          UNIF GIFT MIN ACT- _______ Custodian ________
         common                                     (Cust)            (Minor)
TEN ENT- as tenants by the
         entireties                      under Uniform Gifts to
 JT TEN- as joint tenants                     Minors Act
         with right of
         survivorship and              ________________________
         not as tenants                       (State)
         in common

                    Additional abbreviations may also be used
                          though not on the above list.

         FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto

(please insert Social Security or other identifying number of assignee)

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE

the within Note and all rights thereunder, hereby irrevocably constituting and
appointing

agent to transfer said Note on the books of the Company, with full power of
substitution in the premises.

Dated:
       --------------------                 -----------------------------------

                                            NOTICE: The signature to this
                                            assignment must correspond with the
                                            name as written upon the face of the
                                            within instrument in every
                                            particular without alteration or
                                            enlargement, or any change whatever.

<PAGE>

                                    EXHIBIT B

                          CERTIFICATE OF AUTHENTICATION

         This is one of the Senior Notes referred to in the within-mentioned
Indenture.

                    JPMORGAN CHASE BANK,
                    as Trustee

                    By:
                       --------------------------------------------------------
                             Authorized Officer<PAGE>

                                                                   EXHIBIT 10.12

                             555 TWIN DOLPHIN PLAZA
                            REDWOOD CITY, CALIFORNIA

                             OFFICE LEASE AGREEMENT

                                     BETWEEN

    CA-TWIN DOLPHIN PLAZA LIMITED PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP
                                  ("LANDLORD")

                                       AND

      AVISTAR COMMUNICATIONS CORPORATION, A DELAWARE CORPORATION ("TENANT")

<PAGE>

                             OFFICE LEASE AGREEMENT

         THIS OFFICE LEASE AGREEMENT (the "LEASE") is made and entered into as
of the 30th day of July, 2003, by and between CA-TWIN DOLPHIN PLAZA LIMITED
PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP ("LANDLORD") and AVISTAR
COMMUNICATIONS CORPORATION, A DELAWARE CORPORATION ("TENANT"). The following
exhibits and attachments are incorporated into and made a part of the Lease:
EXHIBIT A (Outline and Location of Premises), EXHIBIT B (Expenses and Taxes),
EXHIBIT C-1 (Initial Premises Work Letter), EXHIBIT C-2 (Additional Premises
Work Letter), EXHIBIT C-3 (Plans), EXHIBIT D (Commencement Letter), EXHIBIT E
(Building Rules and Regulations), EXHIBIT F (Additional Provisions), EXHIBIT G
(Parking Agreement), and EXHIBIT G-1 (Location of Reserved Parking Spaces).

         1.       BASIC LEASE INFORMATION.

                  1.01     "BUILDING" shall mean the building located at 555
Twin Dolphin Drive, Redwood City, California, commonly known as 555 Twin Dolphin
Plaza. "RENTABLE SQUARE FOOTAGE OF THE BUILDING" is deemed to be 205,749 square
feet.

                  1.02     "PREMISES" shall mean the area shown on EXHIBIT A to
this Lease. The Premises is located on the 1st and 3rd floors and is known as
suites 170, 180, and 360; provided that following the Commencement Date but
prior to the Additional Premises Delivery Date, the term "Premises" shall refer
solely to the Initial Premises (as defined below). The "RENTABLE SQUARE FOOTAGE
OF THE PREMISES" is deemed to be 14,046 square feet, consisting of 11,437
rentable square feet in suite 360 ("SUITE 360"), 793 rentable square feet in
suite 170 ("SUITE 170") and 1,816 rentable square feet in suite 180 ("SUITE
180"), all as more particularly shown on EXHIBIT A. Suite 360 is referred to
herein as the "INITIAL PREMISES"; Suites 170 and 180 collectively are referred
to herein as the "ADDITIONAL PREMISES". Landlord and Tenant stipulate and agree
that the Rentable Square Footage of the Building and the Rentable Square Footage
of the Premises and of each of Suites 170, 180, and 360 are correct. If the
Premises include one or more floors in their entirety, all corridors and
restroom facilities located on such full floor(s) shall be considered part of
the Premises.

                  1.03     "BASE RENT":

         Prior to the Additional Premises Delivery Date (as defined in Section
3.01):

<TABLE>
<CAPTION>
                                                                 ANNUAL RATE                        MONTHLY
PERIOD OR MONTHS OF TERM                                       PER SQUARE FOOT                     BASE RENT
------------------------                                       ---------------                     ---------
<S>                                                            <C>                                <C>
10/1/03 - THE DAY PRIOR TO THE
ADDITIONAL PREMISES DELIVERY DATE                                 $   21.60                       $ 20,586.60
</TABLE>

         Following the Additional Premises Delivery Date (as defined in Section
3.01):

<TABLE>
<CAPTION>
                                                                  ANNUAL RATE                        MONTHLY
PERIOD OR MONTHS OF TERM                                        PER SQUARE FOOT                     BASE RENT
------------------------                                        ---------------                     ---------
<S>                                                             <C>                               <C>
ADDITIONAL PREMISES DELIVERY DATE
      TO 9/30/05                                                   $   21.60                      $  25,282.80
   10/1/05 - 9/30/06                                               $   22.20                      $  25,985.10
   10/01/06 - 3/30/07                                              $   22.80                      $  26,687.40
</TABLE>

<PAGE>

         Notwithstanding anything in this Section of the Lease to the contrary,
so long as Tenant is not in default under this Lease, Tenant shall be entitled
to an abatement of Base Rent in the amount of $20,586.60 per month for 9
consecutive full calendar months of the Term, beginning with the 1st full
calendar month of the Term. In addition, so long as Tenant is not in default
under this Lease, Tenant shall be entitled to an abatement of Base Rent in the
amount of $4,696.20 per month for 9 consecutive full calendar months of the
Term, beginning with the 1st full calendar month following the Additional
Premises Delivery Date. The total amount of Base Rent abated during such periods
shall equal $227,545.20 (the "Abated Base Rent"). If Tenant defaults at any time
during the Term and fails to cure such default within any applicable cure period
under the Lease, all Abated Base Rent shall immediately become due and payable.
The payment by Tenant of the Abated Base Rent in the event of a default shall
not limit or affect any of Landlord's other rights, pursuant to this Lease or at
law or in equity. Only Base Rent shall be abated, and all Additional Rent and
other costs and charges specified in this Lease shall remain as due and payable
pursuant to the provisions of this Lease.

                  1.04     "TENANT'S PRO RATA SHARE": Prior to the Additional
Premises Delivery Date: 5.5587%. On and after the Additional Premises Delivery
Date: 6.8268%

                  1.05     "BASE YEAR" for Taxes (defined in EXHIBIT B): 2003;
"BASE YEAR" for Expenses (defined in EXHIBIT B): 2003.

                  1.06     "TERM": A period of 42 months. The Term shall
commence on October 1, 2003 (the "COMMENCEMENT DATE") and, unless terminated
early in accordance with this Lease, end on March 30, 2007 (the "TERMINATION
DATE"). The "ADDITIONAL PREMISES DELIVERY DATE" shall be as set forth in Section
3.01 below.

                  1.07     ALLOWANCE(S): None. (See Initial Premises Work Letter
and Additional Premises Work Letter for description of Landlord Work and
Additional Premises Landlord Work).

                  1.08     "SECURITY DEPOSIT": $35,000.00, as more fully
described in Section 6.

                  1.09     "GUARANTOR(S)": As of the date of this Lease, there
are no Guarantors.

                  1.10     "BROKER": Cornish & Carey Commercial.

                  1.11     "PERMITTED USE": General Office Use. In addition,
with respect to the Additional Premises only, assembly of electronic components
and shipping and receiving related thereto via the existing double doors in the
Additional Premises, to the extent permitted by Law.

                  1.12     "NOTICE ADDRESS(ES)":

Landlord:                                     Tenant:

CA-Twin Dolphin Plaza Limited Partnership     Avistar Communications Corporation
c/o Equity Office Management, L.L.C.          555 Twin Dolphin Drive
555 Twin Dolphin Drive                        Suite 360
Suite 170                                     Redwood City, California 94065
Redwood City, California 94065
Attn: Property Manager

                                      -2-

<PAGE>

         A copy of any notices to Landlord shall be sent to Equity Office, Two
North Riverside Plaza, Suite 2100, Chicago, Illinois, 60606, Attn: San Francisco
Regional Counsel.

                  1.13     "BUSINESS DAY(S)" are Monday through Friday of each
week, exclusive of New Year's Day, Presidents Day, Memorial Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day ("HOLIDAYS"). Landlord may
designate additional Holidays that are commonly recognized by other office
buildings in the area where the Building is located. "BUILDING SERVICE HOURS"
are 8:00 a.m. to 6:00 p.m. on Business Days.

                  1.14     "INITIAL PREMISES LANDLORD WORK" means the work, if
any, that Landlord is obligated to perform in the Initial Premises pursuant to a
separate agreement (the "INITIAL PREMISES WORK LETTER") attached to this Lease
as EXHIBIT C-1. "ADDITIONAL PREMISES LANDLORD WORK" means the work, if any, that
Landlord is obligated to perform in the Additional Premises pursuant to a
separate agreement (the "ADDITIONAL PREMISES WORK LETTER") attached to this
Lease as EXHIBIT C-2.

                  1.15     "PROPERTY" means the Building and the parcel(s) of
land on which it is located and, at Landlord's discretion, the parking
facilities and other improvements, if any, serving the Building and the
parcel(s) of land on which they are located.

         2.       LEASE GRANT.

         The Premises are hereby leased to Tenant from Landlord, together with
the right to use any portions of the Property that are designated by Landlord
for the common use of tenants and others (the "COMMON AREAS").

         3.       ADJUSTMENT OF ADDITIONAL PREMISES DELIVERY DATE; POSSESSION.

                  3.01     Landlord shall use reasonable efforts to complete the
Additional Premises Landlord Work (as defined in the Additional Premises Work
Letter) prior to November 15, 2003 (the "TARGET ADDITIONAL PREMISES DELIVERY
DATE"); but the actual Additional Premises Delivery Date shall be the date on
which the Additional Premises Landlord Work is Substantially Complete (defined
below). The Termination Date shall not be extended by any delay in the
Additional Premises Delivery Date beyond the Target Additional Premises Delivery
Date. Landlord's failure to Substantially Complete the Additional Premises
Landlord Work by the Target Additional Premises Delivery Date shall not be a
default by Landlord or otherwise render Landlord liable for damages. Promptly
after the determination of the Additional Premises Delivery Date, Landlord and
Tenant shall enter into a commencement letter agreement in the form attached as
EXHIBIT D. The Additional Premises Landlord Work shall be deemed to be
"SUBSTANTIALLY COMPLETE" on the date that all Additional Premises Landlord Work
has been performed, other than any details of construction, mechanical
adjustment or any other similar matter, the noncompletion of which does not
materially interfere with Tenant's use of the Additional Premises. If Landlord
is delayed in the performance of the Additional Premises Landlord Work as a
result of the acts or omissions of Tenant, the Tenant Related Parties (defined
in Section 13) or their respective contractors or vendors, including, without
limitation, changes requested by Tenant to approved plans, Tenant's failure to
comply with any of its obligations under this Lease, or the specification of any
materials or equipment with long lead times (a "TENANT DELAY"), the Additional
Premises Landlord Work shall

                                      -3-

<PAGE>

be deemed to be Substantially Complete on the date that Landlord could
reasonably have been expected to Substantially Complete the Landlord Work absent
any Tenant Delay. Landlord shall not be liable for a failure to deliver
possession of the Additional Premises or any other space due to the holdover or
unlawful possession of such space by another party, however Landlord shall use
reasonable efforts to obtain possession of the space. The commencement date for
such space, in such event, shall be postponed until the date Landlord delivers
possession of the Premises to Tenant free from occupancy by any party. If Tenant
takes possession of the Additional Premises before the Additional Premises
Delivery Date, such possession shall be subject to the terms and conditions of
this Lease and Tenant shall pay Rent (defined in Section 4.01) to Landlord for
each day of possession before the Additional Premises Delivery Date. However,
except for the cost of services requested by Tenant (e.g. freight elevator
usage), Tenant shall not be required to pay Rent for any days of possession
before the Additional Premises Delivery Date 'during which Tenant, with the
approval of Landlord, is in possession of the Additional Premises for the sole
purpose of performing improvements or installing furniture, equipment or other
personal property. Subject to Landlord's obligation to perform the Additional
Premises Landlord Work, the Additional Premises are accepted by Tenant in "as
is" condition and configuration without any representations or warranties by
Landlord. By taking possession of the Additional Premises, Tenant agrees that
the Additional Premises are in good order and satisfactory condition.

                  3.02     Tenant, as successor by merger with its subsidiary,
Avistar Systems Corporation, a Nevada corporation ("ASC"), is currently in
possession of the Initial Premises (along with other space in the Building that
is not subject to this Lease) pursuant to that certain Sublease Agreement dated
July 23, 1999 by and between ASC, as subtenant, and Entex Information Services,
Inc., a Delaware corporation, as sublandlord (the "Sublease"), which Sublease
and Master Lease (as defined in the Sublease) each are scheduled to expire by
their terms on September 30, 2003. Subject to Landlord's obligation to perform
the Initial Premises Landlord Work, the Initial Premises are accepted by Tenant
in "as is" condition and configuration without any representations or warranties
by Landlord. Tenant agrees that the Initial Premises are in good order and
satisfactory condition.

         4.       RENT.

                  4.01     Tenant shall pay Landlord, without any setoff or
deduction, unless expressly set forth in this Lease, all Base Rent and
Additional Rent due for the Term (collectively referred to as "RENT").
"ADDITIONAL RENT" means all sums (exclusive of Base Rent) that Tenant is
required to pay Landlord under this Lease. Base Rent and recurring monthly
charges of Additional Rent shall be due and payable in advance on the first day
of each calendar month without notice or demand. All other items of Rent shall
be due and payable by Tenant on or before 30 days after billing by Landlord.
Rent shall be made payable to the entity, and sent to the address, Landlord
designates and shall be made by good and sufficient check or by other means
acceptable to Landlord. Tenant shall pay Landlord an administration fee equal to
5% of all past due Rent, provided that Tenant shall be entitled to a grace
period of 5 days after written notice by Landlord of delinquency for the first 2
late payments of Rent in a calendar year. In addition, past due Rent shall
accrue interest at 12% per annum. Landlord's acceptance of less than the correct
amount of Rent shall be considered a payment on account of the earliest Rent
due. Rent for any partial month during the Term shall be prorated. No
endorsement or statement on a check or letter accompanying payment shall be
considered an accord and satisfaction. Tenant's covenant to pay Rent is
independent of every other covenant in this Lease.

                                      -4-

<PAGE>

                  4.02     Tenant shall pay Tenant's Pro Rata Share of Taxes and
Expenses in accordance with EXHIBIT B of this Lease.

         5.       COMPLIANCE WITH LAWS; USE.

         The Premises shall be used for the Permitted Use and for no other use
whatsoever. Tenant shall comply with all statutes, codes, ordinances, orders,
rules and regulations of any municipal or governmental entity whether in effect
now or later, including the Americans with Disabilities Act ("LAWS(S)"),
regarding the operation of Tenant's business and the use, condition,
configuration and occupancy of the Premises. In addition, Tenant shall, at its
sole cost and expense, promptly comply with any Laws that relate to the "Base
Building" (defined below), but only to the extent such obligations are triggered
by Tenant's use of the Premises, other than for general office use, or
Alterations or improvements in the Premises performed or requested by Tenant.
"Base Building" shall include the structural portions of the Building, the
public restrooms and the Building mechanical, electrical and plumbing systems
and equipment located in the internal core of the Building on the floor or
floors on which the Premises are located. Tenant shall promptly provide Landlord
with copies of any notices it receives regarding an alleged violation of Law.
Notwithstanding anything in the foregoing to the contrary, Landlord, at its sole
cost and expense (except to the extent properly included in Expenses), shall be
responsible for correcting any violations of Title III of the Americans with
Disabilities Act or of applicable building or fire codes with respect to the
Premises, provided that Landlord's obligation shall be limited to violations
that arise out of the Initial Premises Landlord Work or the Additional Premises
Landlord Work, or out of the condition of the Premises prior to the date hereof
and prior to installation of Tenant's furniture, equipment and other personal
property. Landlord shall have the right to contest any alleged violation in good
faith, including, without limitation, the right to apply for and obtain a waiver
or deferment of compliance, the right to assert any and all defenses allowed by
Law and the right to appeal any decisions, judgments or rulings to the fullest
extent permitted by Law. Landlord, after the exhaustion of any and all rights to
appeal or contest, will make all repairs, additions, alterations or improvements
necessary to comply with the terms of any final order or judgment.
Notwithstanding the foregoing, Tenant, not Landlord, shall be responsible for
the correction of any violations that arise out of or in connection with any
claims brought under any provision of the Americans with Disabilities Act other
than Title III, the specific nature of Tenant's business in the Premises (other
than general office use or shipping and receiving to the extent permitted under
the Permitted Use), the acts or omissions of Tenant, its agents, employees or
contractors, Tenant's arrangement of any furniture, equipment or other property
in the Premises, any repairs, alterations, additions or improvements performed
by or on behalf of Tenant (other than the Initial Premises Landlord Work and the
Additional Premises Landlord Work) and any design or configuration of the
Premises specifically requested by Tenant after being informed that such design
or configuration may not be in strict compliance with the ADA. In addition,
except to the extent properly included in Expenses due to a change in Law,
Landlord shall be responsible for the cost of addressing, to the extent Landlord
is required to do so by appropriate governmental authorities, the presence of
any hazardous materials or substances existing at the Property or Building in
amounts and under conditions that are in violation of applicable environmental
laws as of the date of this Lease, or which are thereafter brought to the
Property or Building by Landlord or Landlord's employees or agents and
unlawfully released or disposed of at the Property or Building by such party
(provided, however, that this provision will not apply to any hazardous material
or substance introduced to, produced, stored, released, disposed of or generated
at the Building, the Premises and/or the Property

                                      -5-

<PAGE>

by Tenant or Tenant Related Parties, or to conditions which are exacerbated by
Tenant or Tenant Related Parties, whether prior to or following the date of this
Lease). Notwithstanding the foregoing, Landlord shall have the right (i) to
contest any alleged violation of environmental laws in good faith, including,
without limitation, the right to apply for and obtain a waiver or deferment of
compliance, the right to assert any and all defenses allowed by Law and the
right to appeal any decisions, judgments or rulings to the fullest extent
permitted by Law, and (ii) claim that another tenant at the Building or other
third party is responsible for any alleged contamination and to seek a
determination requiring such other tenant or third party to remediate such
contamination. Landlord, after the exhaustion of any and all rights to appeal or
contest, will make all repairs, additions, alterations or improvements necessary
to comply with the terms of any final order or judgment. Tenant shall comply
with the rules and regulations of the Building attached as EXHIBIT E and such
other reasonable rules and regulations adopted by Landlord from time to time,
including rules and regulations for the performance of Alterations (defined in
Section 9), provided that Tenant shall not be required to comply with any rule
or regulation adopted after the date of this Lease to the extent such new rule
or regulation unreasonably interferes with Tenant's use of the Premises or
parking rights as provided herein or materially increase the obligations or
decrease the rights of Tenant under this Lease. The rules and regulations shall
be generally applicable, and generally applied in the same manner, to all
tenants of the Building.

         6.       SECURITY DEPOSIT.

         The Security Deposit, if any, shall be delivered to Landlord upon the
execution of this Lease by Tenant and held by Landlord without liability for
interest (unless required by Law) as security for the performance of Tenant's
obligations. The Security Deposit is not an advance payment of Rent or a measure
of damages. Landlord may use all or a portion of the Security Deposit to the
extent actually required to satisfy past due Rent or to cure any Default
(defined in Section 18) by Tenant. If Landlord uses any portion of the Security
Deposit, Tenant shall, within 5 days after demand, restore the Security Deposit
to its original amount. Landlord shall return any unapplied portion of the
Security Deposit to Tenant within 45 days after the later to occur of the
Termination Date or the date Tenant surrenders the Premises to Landlord in
compliance with Section 25. In addition to any other deductions Landlord is
entitled to make pursuant to the terms hereof, Landlord shall have the right to
make a good faith estimate of any unreconciled Expenses and/or Taxes as of the
Termination Date and to deduct any anticipated shortfall from the Security
Deposit. Landlord may assign the Security Deposit to a successor or transferee
and, following the assignment and such successor's or transferee's assumption of
Landlord's liability therefor, Landlord shall have no further liability for the
return of the Security Deposit. Landlord shall not be required to keep the
Security Deposit separate from its other accounts. Tenant hereby waives the
provisions of Section 1950.7 of the California Civil Code, or any similar or
successor Laws now or hereinafter in effect.

         7.       BUILDING SERVICES.

                  7.01     Landlord shall furnish Tenant with the following
services: (a) water for use in the Base Building lavatories 24 hours a day, 7
days a week; (b) customary heat, ventilating and air conditioning in season
during Building Service Hours. Tenant shall have the right to receive HVAC
service during hours other than Building Service Hours by paying Landlord's then
standard charge for additional HVAC service and providing such prior notice as
is reasonably specified by Landlord; (c) standard janitorial service on Business
Days; (d) Elevator service; (e) Electricity in accordance

                                      -6-

<PAGE>

with the terms and conditions in Section 7.02; and (f) such other services as
Landlord reasonably determines are necessary or appropriate for the Property.

                  7.02     Electricity used by Tenant in the Premises shall, at
Landlord's option, be paid for by Tenant either: (a) through inclusion in
Expenses (except as provided for excess usage); (b) by a separate charge payable
by Tenant to Landlord; or (c) by separate charge billed by the applicable
utility company and payable directly by Tenant. Without the consent of Landlord,
Tenant's use of electrical service shall not exceed, either in voltage, rated
capacity, use beyond Building Service Hours or overall load, that which Landlord
reasonably deems to be standard for the Building. Landlord shall have the right
to measure electrical usage by commonly accepted methods. If it is determined
that Tenant is using excess electricity, Tenant shall pay Landlord for the cost
of such excess electrical usage as Additional Rent.

                  7.03     Landlord's failure to furnish, or any interruption,
diminishment or termination of services due to the application of Laws, the
failure of any equipment, the performance of repairs, improvements or
alterations, utility interruptions or the occurrence of an event of Force
Majeure (defined in Section 26.03) (collectively a "SERVICE FAILURE") shall not
render Landlord liable to Tenant, constitute a constructive eviction of Tenant,
give rise to an abatement of Rent, nor relieve Tenant from the obligation to
fulfill any covenant or agreement. However, if the Premises, or a material
portion of the Premises, are made unsuitable for Tenant's use or if Tenant's
access to the Premises or a material portion of the Premises is materially
impaired for a period in excess of 3 consecutive Business Days as a result of a
Service Failure that is reasonably within the control of Landlord to correct,
then Tenant, as its sole remedy, shall be entitled to receive an abatement of
Rent payable hereunder during the period beginning on the 4th consecutive
Business Day of the Service Failure and ending on the day the service has been
restored. If the entire Premises have not been rendered unsuitable for Tenant's
use by the Service Failure, the amount of abatement shall be equitably prorated.

         8.       LEASEHOLD IMPROVEMENTS.

         All improvements in and to the Premises, including any Alterations
(collectively, "LEASEHOLD IMPROVEMENTS"), but not including Tenant's Property,
shall remain upon the Premises at the end of the Term without compensation to
Tenant. Landlord, however, by written notice to Tenant at least 30 days prior to
the Termination Date, may require Tenant, at its expense, to remove) any
Landlord Work or Alterations that, in Landlord's reasonable judgment, are of a
nature that would require removal and repair costs that are materially in excess
of the removal and repair costs associated with standard office improvements
(collectively referred to as "REQUIRED REMOVABLES"), provided that Required
Removables shall not include Cable. Required Removables shall include, without
limitation, internal stairways, raised floors, personal baths and showers,
vaults, rolling file systems and structural alterations and modifications. The
designated Required Removables shall be removed by Tenant before the Termination
Date. Tenant shall repair damage caused by the installation or removal of
Required Removables. If Tenant fails to perform its obligations in a timely
manner, Landlord may perform such work at Tenant's expense. Tenant, at the time
it requests approval for a proposed Alteration (or provides notice of a Cosmetic
Alteration), may request in writing that Landlord advise Tenant whether the
Alteration or any portion of the Alteration is a Required Removable. Within 10
days after receipt of Tenant's request, Landlord shall advise Tenant in writing
as to which portions of the Alteration are Required Removables. Landlord agrees
that no

                                      -7-

<PAGE>

part of the Initial Premises Landlord Work or the Additional Premises Landlord
Work as defined in the Work Letters as of the date of this Lease shall
constitute "Required Removables."

         9.       REPAIRS AND ALTERATIONS.

                  9.01     Tenant shall periodically inspect the Premises to
identify any conditions that are dangerous or in need of maintenance or repair.
Tenant shall promptly provide Landlord with notice of any such conditions.
Tenant shall, at its sole cost and expense, perform all maintenance and repairs
to the Premises that are not Landlord's express responsibility under this Lease,
and keep the Premises in good condition and repair, reasonable wear and tear
excepted. Tenant's repair and maintenance obligations include, without
limitation, repairs to: (a) floor covering; (b) interior partitions; (c) doors;
(d) the interior side of demising walls; (e) electronic, phone and data cabling
and related equipment that is installed by or for the exclusive benefit of
Tenant (collectively, "CABLE"); (f) supplemental air conditioning units;
kitchens, including hot water heaters, plumbing, and similar facilities
exclusively serving Tenant; and (g) Alterations. To the extent Landlord is not
reimbursed by insurance proceeds, Tenant shall reimburse Landlord for the cost
of repairing damage to the Building caused by the acts of Tenant, Tenant Related
Parties and their respective contractors and vendors. If Tenant fails to make
any repairs to the Premises for more than 15 days after notice from Landlord
(although notice shall not be required in an emergency), Landlord may make the
repairs, and Tenant shall pay the reasonable cost of the repairs, together with
an administrative charge in an amount equal to 10% of the cost of the repairs.

                  9.02     Landlord shall keep and maintain in good repair and
working order and perform maintenance upon the: (a) structural elements of the
Building; (b) mechanical (including HVAC), electrical, plumbing, water, sewer,
gas piping and fire/life safety systems serving the Building in general; (c)
Common Areas; (d) roof of the Building; (e) exterior windows of the Building;
and (f) elevators serving the Building. Landlord shall promptly make repairs for
which Landlord is responsible. Tenant hereby waives any and all rights under and
benefits of subsection 1 of Section 1932, and Sections 1941 and 1942 of the
California Civil Code, or any similar or successor Laws now or hereinafter in
effect.

                  9.03     Tenant shall not make alterations, repairs, additions
or improvements or install any Cable (collectively referred to as "ALTERATIONS")
without first obtaining the written consent of Landlord in each instance, which
consent shall not be unreasonably withheld or delayed. However, Landlord's
consent shall not be required for any Alteration that satisfies all of the
following criteria (a "COSMETIC ALTERATION"): (a) is of a cosmetic nature such
as painting, wallpapering, hanging pictures and installing carpeting, or if the
cost thereof does not exceed $25,000.00; (b) is not visible from the exterior of
the Premises or Building; (c) will not affect the Base Building; and (d) does
not require work to be performed inside the walls or above the ceiling of the
Premises. Cosmetic Alterations shall be subject to all the other provisions of
this Section 9.03. Prior to starting work, Tenant shall furnish Landlord with
plans and specifications (if necessary for the issuance of required permits or
if reasonably deemed necessary by Landlord due to the nature of the work to be
performed); names of contractors reasonably acceptable to Landlord (provided
that Landlord may designate specific contractors with respect to Base Building);
required permits and approvals; evidence of contractor's and subcontractor's
insurance in amounts reasonably required by Landlord and naming Landlord as an
additional insured; and any security for performance in amounts reasonably
required by Landlord. Changes to the plans and specifications, if any, must also
be

                                      -8-

<PAGE>

submitted to Landlord for its approval. Alterations shall be constructed in a
good and workmanlike manner using materials of a quality reasonably approved by
Landlord. Tenant shall reimburse Landlord for any sums paid by Landlord for
third party examination of Tenant's plans for non-Cosmetic Alterations. In
addition, Tenant shall pay Landlord a fee for Landlord's oversight and
coordination of any non-Cosmetic Alterations equal to 3% of the cost of the
Alterations. Upon completion, Tenant shall furnish marked-up plans clearly
showing all changes and revisions to the original plans submitted to Landlord
for non-Cosmetic Alterations, completion affidavits and full and final waivers
of lien. Landlord's approval of an Alteration shall not be deemed a
representation by Landlord that the Alteration complies with Law. Tenant's trade
fixtures, furniture, equipment and other personal property installed in the
Premises shall remain Tenant's Property and Tenant may remove Tenant's Property
at any time during the Term, provided that Tenant repairs any damage to the
Premises or the Building caused by such removal. Landlord shall have no lien or
other interest in any item of Tenant's Property.

         10.      ENTRY BY LANDLORD.

         Landlord may enter the Premises to inspect, show or clean the Premises
or to perform or facilitate the performance of repairs, alterations or additions
to the Premises or any portion of the Building. Except in emergencies or to
provide Building services, Landlord shall provide Tenant with reasonable prior
verbal notice of entry by telephone call to the number provided by Tenant to
Landlord in writing from time to time (not less than 24 hours, except during the
last 9 months of the Term for purposes of showing the Premises to prospective
tenants) shall use reasonable efforts to minimize any interference with Tenant's
use of the Premises and to comply with Tenant's reasonable security measures. If
reasonably necessary, Landlord may temporarily close all or a portion of the
Premises to perform repairs, alterations and additions. However, except in
emergencies, Landlord will not close the Premises if the work can reasonably be
completed on weekends and after Building Service Hours. Entry by Landlord shall
not constitute a constructive eviction or entitle Tenant to an abatement or
reduction of Rent. Landlord shall not have the right to show the Premises to
prospective tenants prior to the last 9 months of the Term.

         11.      ASSIGNMENT AND SUBLETTING.

                  11.01    Except in connection with a Permitted Transfer
(defined in Section 11.04), Tenant shall not assign, sublease, transfer or
encumber any interest in this Lease or allow any third party to use any portion
of the Premises (collectively or individually, a "TRANSFER") without the prior
written consent of Landlord, which consent shall not be unreasonably withheld,
conditioned or delayed if Landlord does not exercise its recapture rights under
Section 11.02. If the entity which controls the voting shares/rights of Tenant
changes at any time, such change of ownership or control shall constitute a
Transfer unless Tenant is an entity whose outstanding stock is listed on a
recognized securities exchange or if at least 80% of its voting stock is owned
by another entity, the voting stock of which is so listed. The foregoing also
shall not apply to the infusion of additional equity capital in Tenant or an
initial public offering of equity securities of Tenant under the Securities Act
of 1933, as amended, which results in Tenant's stock being traded on a national
securities exchange, including, but not limited to, the NYSE, the NASDAQ Stock
Market or the NASDAQ Small Cap Market System, or to any change in control
resulting from a transfer of stock among shareholders existing as of the date of
this Lease, provided that Landlord is notified of the change in control within
30 days following the effective date of the change in control. Tenant

                                      -9-

<PAGE>

hereby waives the provisions of Section 1995.310 of the California Civil Code,
or any similar or successor Laws, now or hereinafter in effect, and all other
remedies, including, without limitation, any right at law or equity to terminate
this Lease, on its own behalf and, to the extent permitted under all applicable
Laws, on behalf of the proposed transferee. Any attempted Transfer in violation
of this Section is voidable by Landlord. In no event shall any Transfer,
including a Permitted Transfer, release or relieve Tenant from any obligation
under this Lease.

                  11.02    Tenant shall provide Landlord with financial
statements for the proposed transferee, a fully executed copy of the proposed
assignment, sublease or other Transfer documentation and such other information
as Landlord may reasonably request. Within 15 Business Days after receipt of the
required information and documentation, Landlord shall either: (a) consent to
the Transfer by execution of a consent agreement in a form reasonably designated
by Landlord; (b) reasonably refuse to consent to the Transfer in writing; or (c)
in the event of an assignment of this Lease or subletting of either all of the
Initial Premises or all of the Additional Premises, or the entire Premises, for
more than 75% of the remaining Term (excluding unexercised options), recapture
the portion of the Premises that Tenant is proposing to Transfer. If Landlord
exercises its right to recapture, this Lease shall automatically be amended (or
terminated if the entire Premises is being assigned or sublet) to delete the
applicable portion of the Premises effective on the proposed effective date of
the Transfer. Tenant shall pay Landlord a review fee of $750.00 for Landlord's
review of any Permitted Transfer or requested Transfer.

                  11.03    Tenant shall pay Landlord 50% of all rent and other
consideration which Tenant receives as a result of a Transfer that is in excess
of the Rent payable to Landlord for the portion of the Premises and Term covered
by the Transfer. Tenant shall pay Landlord for Landlord's share of the excess
within 30 days after Tenant's receipt of the excess. Tenant may deduct from the
excess, on a straight-line basis, all reasonable and customary expenses directly
incurred by Tenant attributable to the Transfer. If Tenant is in Default,
Landlord may require that all sublease payments be made directly to Landlord, in
which case Tenant shall receive a credit against Rent in the amount of Tenant's
share of payments received by Landlord.

                  11.04    Tenant may assign this Lease to a successor to Tenant
by purchase (including by purchase of substantially all of Tenant's assets),
merger, consolidation or reorganization (an "OWNERSHIP CHANGE") or assign this
Lease or sublet all or a portion of the Premises to an Affiliate without the
consent of Landlord, provided that all of the following conditions are satisfied
(a "PERMITTED TRANSFER"): (a) Tenant is not in Default beyond applicable notice
and cure periods; (b) in the event of an Ownership Change, Tenant's successor
shall own substantially all of the assets of Tenant and have a net worth which
is at least equal to Tenant's net worth as of the day prior to the proposed
Ownership Change; (c) the Permitted Use does not allow the Premises to be used
for retail purposes (except for e-business, to the extent permitted under the
Permitted Use); and (d) Tenant shall give Landlord written notice at least 15
Business Days prior to the effective date of the Permitted Transfer. Tenant's
notice to Landlord shall include information and documentation evidencing the
Permitted Transfer and showing that each of the above conditions has been
satisfied. If requested by Landlord, Tenant's successor shall sign a
commercially reasonable form of assumption agreement. "AFFILIATE" shall mean an
entity controlled by, controlling or under common control with Tenant.

                                      -10-

<PAGE>

         12.      LIENS.

         Tenant shall not permit mechanics' or other liens to be placed upon the
Property, Premises or Tenant's leasehold interest in connection with any work or
service done or purportedly done by or for the benefit of Tenant or its
transferees. Tenant shall give Landlord notice at least 15 days prior to the
commencement of any work in the Premises to afford Landlord the opportunity,
where applicable, to post and record notices of non-responsibility. Tenant,
within 10 days of notice from Landlord, shall fully discharge any lien by
settlement, by bonding or by insuring over the lien in the manner prescribed by
the applicable lien Law. If Tenant fails to do so, Landlord may bond, insure
over or otherwise discharge the lien. Tenant shall reimburse Landlord for any
amount paid by Landlord, including, without limitation, reasonable attorneys'
fees.

         13.      INDEMNITY AND WAIVER OF CLAIMS.

         Tenant hereby waives all claims against and releases Landlord and its
trustees, members, principals, beneficiaries, partners, officers, directors,
employees, Mortgagees (defined in Section 23) and agents (the "LANDLORD RELATED
PARTIES") from all claims for any injury to or death of persons, damage to
property or business loss in any manner related to (a) Force Majeure, (b) acts
of third parties, (c) the bursting or leaking of any tank, water closet, drain
or other pipe, (d) the inadequacy or failure of any security services, personnel
or equipment, or (e) any matter not within the reasonable control of Landlord.
Except to the extent caused by the negligence or willful misconduct of Landlord
or any Landlord Related Parties, Tenant shall indemnify, defend and hold
Landlord and Landlord Related Parties harmless against and from all liabilities,
obligations, damages, penalties, claims, actions, costs, charges and expenses,
including, without limitation, reasonable attorneys' fees and other professional
fees (if and to the extent permitted by Law) (collectively referred to as
"LOSSES"), which may be imposed upon, incurred by or asserted against Landlord
or any of the Landlord Related Parties by any third party and arising out of or
in connection with any damage or injury occurring in the Premises or any acts or
omissions (including violations of Law) of Tenant, the Tenant Related Parties or
any of Tenant's transferees, contractors or licensees. Except to the extent
caused by the negligence or willful misconduct of Tenant or any Tenant Related
Parties, Landlord shall indemnify, defend and hold Tenant, its trustees,
members, principals, beneficiaries, partners, officers, directors, employees and
agents ("TENANT RELATED PARTIES") harmless against and from all Losses which may
be imposed upon, incurred by or asserted against Tenant or any of the Tenant
Related Parties by any third party and arising out of or in connection with the
acts or omissions (including violations of Law) of Landlord or the Landlord
Related Parties.

         14.      INSURANCE.

         Tenant shall maintain the following insurance ("TENANT'S INSURANCE"):
(a) Commercial General Liability Insurance applicable to the Premises and its
appurtenances providing, on an occurrence basis, a minimum combined single limit
of $2,000,000.00; (b) Property/Business Interruption Insurance written on an All
Risk or Special Perils form, with coverage for broad form water damage including
earthquake sprinkler leakage, at replacement cost value and with a replacement
cost endorsement covering all of Tenant's business and trade fixtures,
equipment, movable partitions, furniture, merchandise and other personal
property within the Premises ("TENANT'S PROPERTY") and any Leasehold
Improvements performed by or for the benefit of Tenant; (c) Workers'
Compensation Insurance in amounts required by Law; and (d) Employers Liability

                                      -11-

<PAGE>

Coverage of at least $1,000,000.00 per occurrence. Any company writing Tenant's
Insurance shall have an A.M. Best rating of not less than A-VIII. All Commercial
General Liability Insurance policies shall name as additional insureds Landlord
(or its successors and assignees), the managing agent for the Building (or any
successor), EOP Operating Limited Partnership, Equity Office Properties Trust
and their respective members, principals, beneficiaries, partners, officers,
directors, employees, and agents, and other designees of Landlord and its
successors as the interest of such designees shall appear. All policies of
Tenant's Insurance shall contain endorsements that the insurer(s) shall give
Landlord and its designees at least 30 days' advance written notice of any
cancellation, termination, material change or lapse of insurance. Tenant shall
provide Landlord with a certificate of insurance evidencing Tenant's Insurance
prior to the earlier to occur of the Commencement Date or the date Tenant is
provided with possession of the Premises, and thereafter as necessary to assure
that Landlord always has current certificates evidencing Tenant's Insurance.
Landlord shall maintain so called All Risk property insurance on the Building at
replacement cost value as reasonably estimated by Landlord.

         15.      SUBROGATION.

         Landlord and Tenant hereby waive and shall cause their respective
insurance carriers to waive any and all rights of recovery, claims, actions or
causes of action against the other for any loss or damage with respect to
Tenant's Property, Leasehold Improvements, the Building, the Premises, or any
contents thereof, including rights, claims, actions and causes of action based
on negligence, which loss or damage is (or would have been, had the insurance
required by this Lease been carried) covered by insurance.

         16.      CASUALTY DAMAGE.

                  16.01    If all or any portion of the Premises becomes damaged
by fire or other casualty to the Premises (collectively a "CASUALTY") and
Tenant's use of the Premises is materially affected thereby, Landlord, with
reasonable promptness, shall cause a general contractor selected by Landlord to
provide Landlord and Tenant with a written estimate of the amount of time
required using standard working methods to Substantially Complete the repair and
restoration of the Premises and any Common Areas necessary to provide access to
the Premises ("COMPLETION ESTIMATE"). If the Completion Estimate indicates that
repairs necessary to restore the Premises to the condition set forth in Section
16.02 below or that repairs to any Common Areas necessary to provide access to
the Premises cannot be accomplished within 180 days from the date the repair is
started, then either party shall have the right to terminate this Lease upon
written notice to the other within 10 days after receipt of the Completion
Estimate. Tenant, however, shall not have the right to terminate this Lease if
the Casualty was caused by the negligence or intentional misconduct of Tenant or
any Tenant Related Parties. In addition, Landlord, by notice to Tenant within 90
days after the date of the Casualty, shall have the right to terminate this
Lease if: (1) the Premises have been materially damaged and there is less than 1
year of the Term remaining on the date of the Casualty; (2) any Mortgagee
requires that the insurance proceeds be applied to the payment of the mortgage
debt; or (3) a material uninsured loss to the Building occurs (unless such
uninsured loss is due to Landlord's failure to maintain the insurance required
by Section 14. Notwithstanding the foregoing, Landlord will not be entitled to
terminate this Lease solely because there is less than 1 year on the Term if
Tenant has an exercisable right to renew or extend the Term and Tenant, within
10 days after receipt

                                      -12-

<PAGE>

of Landlord's notice of termination, validly exercises such right. The foregoing
shall not prohibit Landlord from exercising its right to terminate for any of
the other reasons set forth herein.

                  16.02    If this Lease is not terminated, Landlord shall
promptly and diligently, subject to reasonable delays for insurance adjustment
or other matters beyond Landlord's reasonable control, restore the Premises and
Common Areas. Such restoration shall be to substantially the same condition that
existed prior to the Casualty, except for modifications required by Law or any
other modifications to the Common Areas deemed desirable by Landlord. Upon
notice from Landlord, Tenant shall assign to Landlord (or to any party
designated by Landlord) all property insurance proceeds payable to Tenant under
Tenant's Insurance with respect to any Leasehold Improvements performed by or
for the benefit of Tenant; provided if the estimated cost to repair such
Leasehold Improvements exceeds the amount of insurance proceeds received by
Landlord from Tenant's insurance carrier, the excess cost of such repairs shall
be paid by Tenant to Landlord prior to Landlord's commencement of repairs.
Within 15 days of demand, Tenant shall also pay Landlord for any additional
excess costs that are determined during the performance of the repairs. Landlord
shall not be liable for any inconvenience to Tenant, or injury to Tenant's
business resulting in any way from the Casualty or the repair thereof. Provided
that Tenant is not in Default, during any period of time that all or a material
portion of the Premises is rendered untenantable as a result of a Casualty, the
Rent shall abate for the portion of the Premises that is untenantable and not
used by Tenant.

                  16.03    The provisions of this Lease, including this Section
16, constitute an express agreement between Landlord and Tenant with respect to
any and all damage to, or destruction of, all or any part of the Premises or the
Property, and any Laws, including, without limitation, Sections 1932(2) and
1933(4) of the California Civil Code, with respect to any rights or obligations
concerning damage or destruction in the absence of an express agreement between
the parties, and any similar or successor Laws now or hereinafter in effect,
shall have no application to this Lease or any damage or destruction to all or
any part of the Premises or the Property.

         17.      CONDEMNATION.

         Either party may terminate this Lease if any material part of the
Premises is taken or condemned for any public or quasi-public use under Law, by
eminent domain or private purchase in lieu thereof (a "TAKING"). Landlord shall
also have the right to terminate this Lease if there is a Taking of any portion
of the Building or Property which would have a material adverse effect on
Landlord's ability to profitably operate the remainder of the Building. The
terminating party shall provide written notice of termination to the other party
within 45 days after it first receives notice of the Taking. The termination
shall be effective on the date the physical taking occurs. If this Lease is not
terminated, Base Rent and Tenant's Pro Rata Share shall be appropriately
adjusted to account for any reduction in the square footage of the Building or
Premises. All compensation awarded for a Taking shall be the property of
Landlord. The right to receive compensation or proceeds are expressly waived by
Tenant, however, Tenant may file a separate claim for Tenant's Property and
Tenant's reasonable relocation expenses, provided the filing of the claim does
not diminish the amount of Landlord's award. If only a part of the Premises is
subject to a Taking and this Lease is not terminated, Landlord, with reasonable
diligence, will restore the remaining portion of the Premises as nearly as
practicable to the condition immediately prior to the Taking. Tenant hereby

                                      -13-

<PAGE>

waives any and all rights it might otherwise have pursuant to Section 1265.130
of the California Code of Civil Procedure, or any similar or successor Laws.

         18.      EVENTS OF DEFAULT.

         Each of the following occurrences shall be a "DEFAULT": (a) Tenant's
failure to pay any portion of Rent when due, if the failure continues for 3
Business Days after written notice to Tenant ("MONETARY DEFAULT"); (b) Tenant's
failure (other than a Monetary Default) to comply with any term, provision,
condition or covenant of this Lease, if the failure is not cured within 10 days
after written notice to Tenant provided, however, if Tenant's failure to comply
cannot reasonably be cured within 10 days, Tenant shall be allowed additional
time (not to exceed 90 days) as is reasonably necessary to cure the failure so
long as Tenant begins the cure within 10 days and diligently pursues the cure to
completion; (c) Tenant or any Guarantor becomes insolvent, makes a transfer in
fraud of creditors, makes an assignment for the benefit of creditors, admits in
writing its inability to pay its debts when due or forfeits or loses its right
to conduct business; (d) the leasehold estate is taken by process or operation
of Law; (e) in the case of any ground floor or retail Tenant, Tenant does not
take possession of or abandons or vacates all or any portion of the Premises; or
(f) Tenant is in default beyond any notice and cure period under any other lease
or agreement with Landlord at the Building or Property. If Landlord provides
Tenant with notice of Tenant's failure to comply with any specific provision of
this Lease on 3 separate occasions during any 12 month period, Tenant's
subsequent violation of such provision within the 12 month period following the
date of the third such cure shall, at Landlord's option, be an incurable Default
by Tenant. All notices sent under this Section shall be in satisfaction of, and
not in addition to, notice required by Law.

         19.      REMEDIES.

                  19.01    Upon the occurrence of any Default under this Lease,
whether enumerated in Section 18 or not, Landlord shall have the option to
pursue any one or more of the following remedies without any notice (except as
expressly prescribed herein) or demand whatsoever (and without limiting the
generality of the foregoing, Tenant hereby specifically waives notice and demand
for payment of Rent or other obligations, except for those notices specifically
required pursuant to the terms of Section 18 or this Section 19, and waives any
and all other notices or demand requirements imposed by applicable law):

                           (a)      Terminate this Lease and Tenant's right to
possession of the Premises and recover from Tenant an award of damages equal to
the sum of the following:

                                    (i)      The Worth at the Time of Award of
the unpaid Rent which had been earned at the time of termination;

                                    (ii)     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 affirmatively proves could have been reasonably avoided;

                                    (iii)    The Worth at the Time of Award of
the amount by which the unpaid Rent for the balance of the Term after the time
of award exceeds the amount of such Rent loss that Tenant affirmatively proves
could be reasonably avoided;

                                      -14-

<PAGE>

                                    (iv)     Any other amount necessary to
compensate Landlord for all the detriment either proximately caused by Tenant's
failure to perform Tenant's obligations under this Lease or which in the
ordinary course of things would be likely to result therefrom; and

                                    (v)      All such other amounts in addition
to or in lieu of the foregoing as may be permitted from time to time under
applicable law.

                  The "WORTH AT THE TIME OF AWARD" of the amounts referred to in
parts (i) and (ii) above, shall be computed by allowing interest at the lesser
of a per annum rate equal to: (A) the greatest per annum rate of interest
permitted from time to time under applicable law, or (B) the Prime Rate plus 5%.
For purposes hereof, the "PRIME RATE" shall be the per annum interest rate
publicly announced as its prime or base rate by a federally insured bank
selected by Landlord in the State of California. The "WORTH AT THE TIME OF
AWARD" of the amount referred to in part (iii), above, shall be computed by
discounting such amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus 1%;

                           (b)      Employ the remedy described in California
Civil Code Section 1951.4 (Landlord may continue this Lease in effect after
Tenant's breach and abandonment and recover Rent as it becomes due, if Tenant
has the right to sublet or assign, subject only to reasonable limitations); or

                           (c)      Notwithstanding Landlord's exercise of the
remedy described in California Civil Code Section 1951.4 in respect of an event
or events of default, at such time thereafter as Landlord may elect in writing,
to terminate this Lease and Tenant's right to possession of the Premises and
recover an award of damages as provided above in Paragraph 19.01(a).

                  19.02    The subsequent acceptance of Rent hereunder by
Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of
any term, covenant or condition of this Lease, other than the failure of Tenant
to pay the particular Rent so accepted, regardless of Landlord's knowledge of
such preceding breach at the time of acceptance of such Rent. No waiver by
Landlord of any breach hereof shall be effective unless such waiver is in
writing and signed by Landlord.

                  19.03    TENANT HEREBY WAIVES ANY AND ALL RIGHTS CONFERRED BY
SECTION 3275 OF THE CIVIL CODE OF CALIFORNIA AND BY SECTIONS 1174 (c) AND 1179
OF THE CODE OF CIVIL PROCEDURE OF CALIFORNIA AND ANY AND ALL OTHER LAWS AND
RULES OF LAW FROM TIME TO TIME IN EFFECT DURING THE LEASE TERM PROVIDING THAT
TENANT SHALL HAVE ANY RIGHT TO REDEEM, REINSTATE OR RESTORE THIS LEASE FOLLOWING
ITS TERMINATION BY REASON OF TENANT'S BREACH. TENANT ALSO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY LITIGATION
ARISING OUT OF OR RELATING TO THIS LEASE.

                  19.04    No right or remedy herein conferred upon or reserved
to Landlord is intended to be exclusive of any other right or remedy, and each
and every right and remedy shall be cumulative and in addition to any other
right or remedy given hereunder or now or hereafter existing by agreement,
applicable law or in equity. In addition to other remedies provided in this
Lease,

                                      -15-

<PAGE>

Landlord shall be entitled, to the extent permitted by applicable law, to
injunctive relief, or to a decree compelling performance of any of the
covenants, agreements, conditions or provisions of this Lease, or to any other
remedy allowed to Landlord at law or in equity. Forbearance by Landlord to
enforce one or more of the remedies herein provided upon an event of default
shall not be deemed or construed to constitute a waiver of such default.

                  19.05    If Tenant is in Default of any of its non-monetary
obligations under the Lease, Landlord shall have the right to perform such
obligations. Tenant shall reimburse Landlord for the cost of such performance
upon demand together with an administrative charge equal to 10% of the cost of
the work performed by Landlord.

                  19.06    This Section 19 shall be enforceable to the maximum
extent such enforcement is not prohibited by applicable law, and the
unenforceability of any portion thereof shall not thereby render unenforceable
any other portion.

         20.      LIMITATION OF LIABILITY.

         NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE, THE
LIABILITY OF LANDLORD (AND OF ANY SUCCESSOR LANDLORD) SHALL BE LIMITED TO THE
LESSER OF (A) THE INTEREST OF LANDLORD IN THE PROPERTY, OR (B) THE EQUITY
INTEREST LANDLORD WOULD HAVE IN THE PROPERTY IF THE PROPERTY WERE ENCUMBERED BY
THIRD PARTY DEBT IN AN AMOUNT EQUAL TO 70% OF THE VALUE OF THE PROPERTY. TENANT
SHALL LOOK SOLELY TO LANDLORD'S INTEREST IN THE PROPERTY FOR THE RECOVERY OF ANY
JUDGMENT OR AWARD AGAINST LANDLORD OR ANY LANDLORD RELATED PARTY. NEITHER
LANDLORD NOR ANY LANDLORD RELATED PARTY SHALL BE PERSONALLY LIABLE FOR ANY
JUDGMENT OR DEFICIENCY, AND IN NO EVENT SHALL LANDLORD OR ANY LANDLORD RELATED
PARTY BE LIABLE TO TENANT FOR ANY LOST PROFIT, DAMAGE TO OR LOSS OF BUSINESS OR
ANY FORM OF SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGE. BEFORE FILING SUIT FOR AN
ALLEGED DEFAULT BY LANDLORD, TENANT SHALL GIVE LANDLORD AND THE MORTGAGEE(S)
WHOM TENANT HAS BEEN NOTIFIED HOLD MORTGAGES (DEFINED IN SECTION 23 BELOW),
NOTICE AND REASONABLE TIME TO CURE THE ALLEGED DEFAULT.

         21.      RELOCATION.

         [Intentionally Omitted].

         22.      HOLDING OVER.

         If Tenant fails to surrender all or any part of the Premises at the
termination of this Lease, occupancy of the Premises after termination shall be
that of a tenancy at sufferance. Tenant's occupancy shall be subject to all the
terms and provisions of this Lease, and Tenant shall pay an amount (on a per
month basis without reduction for partial months during the holdover) equal to
150% of the sum of the Base Rent and Additional Rent due for the period
immediately preceding the holdover. No holdover by Tenant or payment by Tenant
after the termination of this Lease shall be construed to extend the Term or
prevent Landlord from immediate recovery of possession of the Premises by
summary proceedings or otherwise. If Landlord is unable to deliver possession of
the

                                      -16-

<PAGE>

Premises to a new tenant or to perform improvements for a new tenant as a result
of Tenant's holdover and Tenant fails to vacate the Premises within 15 days
after notice from Landlord, Tenant shall be liable for all damages that Landlord
suffers from the holdover.

         23.      SUBORDINATION TO MORTGAGES; ESTOPPEL CERTIFICATE.

         Tenant accepts this Lease subject and subordinate to any mortgage(s),
deed(s) of trust, ground lease(s) or other lien(s) now or subsequently arising
upon the Premises, the Building or the Property, and to renewals, modifications,
refinancings and extensions thereof (collectively referred to as a "MORTGAGE").
The party having the benefit of a Mortgage shall be referred to as a
"MORTGAGEE". This clause shall be self-operative, but upon request from a
Mortgagee, Tenant shall execute a commercially reasonable subordination
agreement in favor of the Mortgagee. As an alternative, a Mortgagee shall have
the right at any time to subordinate its Mortgage to this Lease. Upon request,
Tenant, without charge, shall attorn to any successor to Landlord's interest in
this Lease. Landlord and Tenant shall each, within 10 days after receipt of a
written request from the other, execute and deliver a commercially reasonable
estoppel certificate to those parties as are reasonably requested by the other
(including a Mortgagee or prospective purchaser). Without limitation, such
estoppel certificate may include a certification as to the status of this Lease,
the existence of any defaults and the amount of Rent that is due and payable.
Landlord hereby represents that there is no Mortgage encumbering the Property as
of the date of this Lease. Notwithstanding anything in the foregoing to the
contrary, upon written request by Tenant, Landlord will use reasonable efforts
to obtain a non-disturbance, subordination and attornment agreement from
Landlord's then current Mortgagee on such Mortgagee's then current standard form
of agreement. "Reasonable efforts" of Landlord shall not require Landlord to
incur any cost, expense or liability to obtain such agreement, it being agreed
that Tenant shall be responsible for any fee or review costs charged by the
Mortgagee. Upon request of Landlord, Tenant will execute the Mortgagee's form of
non-disturbance, subordination and attornment agreement and return the same to
Landlord for execution by the Mortgagee. Landlord's failure to obtain a
non-disturbance, subordination and attornment agreement for Tenant shall have no
effect on the rights, obligations and liabilities of Landlord and Tenant or be
considered to be a default by Landlord hereunder.

         24.      NOTICE.

         All demands, approvals, consents or notices (collectively referred to
as a "NOTICE") shall be in writing and delivered by hand or sent by registered
or certified mail with return receipt requested or sent by overnight or same day
courier service at the party's respective Notice Address(es) set forth in
Section 1. Each notice shall be deemed to have been received on the earlier to
occur of actual delivery or the date on which delivery is refused, or, if Tenant
has vacated the Premises or any other Notice Address of Tenant without providing
a new Notice Address, 3 days after notice is deposited in the U.S. mail or with
a courier service in the manner described above. Either party may, at any time,
change its Notice Address (other than to a post office box address) by giving
the other party written notice of the new address.

         25.      SURRENDER OF PREMISES.

         At the termination of this Lease or Tenant's right of possession,
Tenant shall remove Tenant's Property from the Premises, and quit and surrender
the Premises to Landlord, broom clean, and in

                                      -17-

<PAGE>

good order, condition and repair, ordinary wear and tear and damage which
Landlord is obligated to repair hereunder excepted. If Tenant fails to remove
any of Tenant's Property within 2 days after termination of this Lease or
Tenant's right to possession, Landlord, at Tenant's sole cost and expense, shall
be entitled (but not obligated) to remove and store Tenant's Property. Landlord
shall not be responsible for the value, preservation or safekeeping of Tenant's
Property. Tenant shall pay Landlord, upon demand, the expenses and storage
charges incurred. If Tenant fails to remove Tenant's Property from the Premises
or storage, within 30 days after notice, Landlord may deem all or any part of
Tenant's Property to be abandoned and title to Tenant's Property shall vest in
Landlord.

         26.      MISCELLANEOUS.

                  26.01    This Lease shall be interpreted and enforced in
accordance with the Laws of the State of California and Landlord and Tenant
hereby irrevocably consent to the jurisdiction and proper venue of such state or
commonwealth. If any term or provision of this Lease shall to any extent be void
or unenforceable, the remainder of this Lease shall not be affected. If there is
more than one Tenant or if Tenant is comprised of more than one party or entity,
the obligations imposed upon Tenant shall be joint and several obligations of
all the parties and entities, and requests or demands from any one person or
entity comprising Tenant shall be deemed to have been made by all such persons
or entities. Notices to any one person or entity shall be deemed to have been
given to all persons and entities. Tenant represents and warrants to Landlord
that each individual executing this Lease on behalf of Tenant is authorized to
do so on behalf of Tenant and that Tenant is not, and the entities or
individuals constituting Tenant or which may own or control Tenant or which may
be owned or controlled by Tenant are not, among the individuals or entities
identified on any list compiled pursuant to Executive Order 13224 for the
purpose of identifying suspected terrorists.

                  26.02    If either party institutes a suit against the other
for violation of or to enforce any covenant, term or condition of this Lease,
the prevailing party shall be entitled to all of its costs and expenses,
including, without limitation, reasonable attorneys' fees. Landlord and Tenant
hereby waive any right to trial by jury in any proceeding based upon a breach of
this Lease. Either party's failure to declare a default immediately upon its
occurrence, or delay in taking action for a default, shall not constitute a
waiver of the default, nor shall it constitute an estoppel.

                  26.03    Whenever a period of time is prescribed for the
taking of an action by Landlord or Tenant (other than the payment of the
Security Deposit or Rent), the period of time for the performance of such action
shall be extended by the number of days that the performance is actually delayed
due to strikes, acts of God, shortages of labor or materials, war, terrorist
acts, civil disturbances and other causes beyond the reasonable control of the
performing party ("FORCE MAJEURE").

                  26.04    Landlord shall have the right to transfer and assign,
in whole or in part, all of its rights and obligations under this Lease and in
the Building and Property. Upon transfer Landlord shall be released from any
further obligations hereunder and Tenant agrees to look solely to the successor
in interest of Landlord for the performance of such obligations, provided that,
any successor pursuant to a voluntary, third party transfer (but not as part of
an involuntary transfer resulting from a foreclosure or deed in lieu thereof)
shall have assumed Landlord's obligations under this Lease.

                                      -18-

<PAGE>

                  26.05    Landlord has delivered a copy of this Lease to Tenant
for Tenant's review only and the delivery of it does not constitute an offer to
Tenant or an option. Tenant represents that it has dealt directly with and only
with the Broker as a broker in connection with this Lease. Tenant shall
indemnify and hold Landlord and the Landlord Related Parties harmless from all
claims of any other brokers claiming to have represented Tenant in connection
with this Lease. Landlord shall indemnify and hold Tenant and the Tenant Related
Parties harmless from all claims of any brokers claiming to have represented
Landlord in connection with this Lease. Equity Office Properties Management
Corp. ("EOPMC") is an affiliate of Landlord and represents only the Landlord in
this transaction. Any assistance rendered by any agent or employee of EOPMC in
connection with this Lease or any subsequent amendment or modification hereto
has been or will be made as an accommodation to Tenant solely in furtherance of
consummating the transaction on behalf of Landlord, and not as agent for Tenant.

                  26.06    Time is of the essence with respect to Tenant's
exercise of any expansion, renewal or extension rights granted to Tenant. The
expiration of the Term, whether by lapse of time, termination or otherwise,
shall not relieve either party of any obligations which accrued prior to or
which may continue to accrue after the expiration or termination of this Lease.

                  26.07    Tenant may peacefully have, hold and enjoy the
Premises, subject to the terms of this Lease, provided Tenant pays the Rent and
fully performs all of its covenants and agreements. This covenant shall be
binding upon Landlord and its successors only during its or their respective
periods of ownership of the Building.

                  26.08    This Lease does not grant any rights to light or air
over or about the Building. Landlord excepts and reserves exclusively to itself
any and all rights not specifically granted to Tenant under this Lease. This
Lease constitutes the entire agreement between the parties and supersedes all
prior agreements and understandings related to the Premises, including all lease
proposals, letters of intent and other documents. Neither party is relying upon
any warranty, statement or representation not contained in this Lease. This
Lease may be modified only by a written agreement signed by an authorized
representative of Landlord and Tenant.

                  26.09    Whenever the Lease requires an approval, consent,
determination, selection or judgment by either Landlord or Tenant, unless
another standard is expressly set forth, such approval, consent, determination,
selection or judgment and any conditions imposed thereby shall be reasonable and
shall not be unreasonably withheld or delayed and, in exercising any right or
remedy hereunder, each party shall at all times act reasonably and in good
faith.

                  29.10    Any expenditure by a party permitted or required
under the Lease, for which such party demands reimbursement from the other
party, shall be limited to the fair market value of the goods and services
involved, shall be reasonably incurred, and shall be substantiated by
documentary evidence available for inspection and review by the other party.

                      [SIGNATURES FOLLOW ON THE NEXT PAGE]

                                      -19-

<PAGE>

         Landlord and Tenant have executed this Lease as of the day and year
first above written.

                                 LANDLORD:

                                 CA-TWIN DOLPHIN PLAZA LIMITED
                                 PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP

                                 By: EOM GP, L.L.C., a Delaware limited
                                     liability company, its general partner

                                     By: Equity Office Management, L.L.C., a
                                         Delaware limited liability company, its
                                         non-member manager

                                         By: /s/ Mark Geisreiter

                                         Name: Mark Geisreiter

                                         Title: Senior Vice President

                                 TENANT:

                                 AVISTAR COMMUNICATIONS
                                 CORPORATION, A DELAWARE CORPORATION

                                 By: /s/ Robert Habig

                                 Name: Robert Habig

                                 Title: Chief Financial Officer

                                 ______________________________________________
                                 TENANT'S TAX ID NUMBER (SSN OR FEIN)

                                      -20-

<PAGE>

                                    EXHIBIT A

                        OUTLINE AND LOCATION OF PREMISES

         [Diagrams of Partial Third Floor Plan - Suite 360 and Third Floor
Keyplan. Pricing Notes, Partial First Floor Plan - Suite 180 and First Floor
Keyplan].

<PAGE>

                                    EXHIBIT B

                               EXPENSES AND TAXES

         This Exhibit is attached to and made a part of the Lease by and between
CA-TWIN DOLPHIN PLAZA LIMITED PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP
("Landlord") and AVISTAR COMMUNICATIONS CORPORATION, A DELAWARE CORPORATION
("Tenant") for space in the Building located at 555 Twin Dolphin Drive, Redwood
City, California.

         1.       PAYMENTS.

                  1.01     Tenant shall pay Tenant's Pro Rata Share of the
amount, if any, by which Expenses (defined below) for each calendar year during
the Term exceed Expenses for the Base Year (the "EXPENSE EXCESS") and also the
amount, if any, by which Taxes (defined below) for each calendar year during the
Term exceed Taxes for the Base Year (the "TAX EXCESS"). If Expenses or Taxes in
any calendar year decrease below the amount of Expenses or Taxes for the Base
Year, Tenant's Pro Rata Share of Expenses or Taxes, as the case may be, for that
calendar year shall be $0. Landlord shall provide Tenant with a good faith
estimate of the Expense Excess and of the Tax Excess for each calendar year
during the Term. On or before the first day of each month, Tenant shall pay to
Landlord a monthly installment equal to one-twelfth of Tenant's Pro Rata Share
of Landlord's estimate of both the Expense Excess and Tax Excess. After its
receipt of the revised estimate, Tenant's monthly payments shall be based upon
the revised estimate. If Landlord does not provide Tenant with an estimate of
the Expense Excess or the Tax Excess by January 1 of a calendar year, Tenant
shall continue to pay monthly installments based on the previous year's
estimate(s) until Landlord provides Tenant with the new estimate.

                  1.02     As soon as is practical following the end of each
calendar year, Landlord shall furnish Tenant with a statement of the actual
Expenses and Expense Excess and the actual Taxes and Tax Excess for the prior
calendar year. If the estimated Expense Excess or estimated Tax Excess for the
prior calendar year is more than the actual Expense Excess or actual Tax Excess,
as the case may be, for the prior calendar year, Landlord shall either provide
Tenant with a refund or apply any overpayment by Tenant against Additional Rent
due or next becoming due, provided if the Term expires before the determination
of the overpayment, Landlord shall refund any overpayment to Tenant after first
deducting the amount of Rent due. If the estimated Expense Excess or estimated
Tax Excess for the prior calendar year is less than the actual Expense Excess or
actual Tax Excess, as the case may be, for such prior year, Tenant shall pay
Landlord, within 30 days after its receipt of the statement of Expenses or
Taxes, any underpayment for the prior calendar year.

         2.       EXPENSES.

                  2.01     "EXPENSES" means all costs and expenses incurred in
each calendar year in connection with operating, maintaining, repairing, and
managing the Building and the Property. Expenses include, without limitation:
(a) all labor and labor related costs, including wages, salaries, bonuses,
taxes, insurance, uniforms, training, retirement plans, pension plans and other
employee benefits; (b) management fees; (c) the cost of equipping, staffing and
operating an on-site and/or off-site management office for the Building,
provided if the management office services one or more other buildings or
properties, the shared costs and expenses of equipping, staffing and operating
such

<PAGE>

management office(s) shall be equitably prorated and apportioned between the
Building and the other buildings or properties; (d) accounting costs; (e) the
cost of services; (f) rental and purchase cost of parts, supplies, tools and
equipment; (g) insurance premiums and deductibles; (h) electricity, gas and
other utility costs; and (i) the amortized cost of capital improvements (as
distinguished from replacement parts or components installed in the ordinary
course of business) made subsequent to the Base Year which are: (1) performed
primarily to reduce current or future operating expense costs, upgrade Building
security or otherwise improve the operating efficiency of the Property; or (2)
required to comply with any Laws that are enacted, or first interpreted to apply
to the Property, after the date of this Lease. The cost of capital improvements
shall be amortized by Landlord over the lesser of the Payback Period (defined
below) or the useful life of the capital improvement as reasonably determined by
Landlord. "PAYBACK PERIOD" means the reasonably estimated period of time that it
takes for the cost savings resulting from a capital improvement to equal the
total cost of the capital improvement. Landlord, by itself or through an
affiliate, shall have the right to directly perform, provide and be compensated
for any services under this Lease. If Landlord incurs Expenses for the Building
or Property together with one or more other buildings or properties, whether
pursuant to a reciprocal easement agreement, common area agreement or otherwise,
the shared costs and expenses shall be equitably prorated and apportioned
between the Building and Property and the other buildings or properties.

                  2.02     Expenses shall not include: the cost of capital
improvements (except as set forth above); depreciation; principal payments of
mortgage and other non-operating debts of Landlord; the cost of repairs or other
work to the extent Landlord is reimbursed by insurance or condemnation proceeds;
costs in connection with leasing space in the Building, including brokerage
commissions; lease concessions, rental abatements and construction allowances
granted to specific tenants; costs incurred in connection with the sale,
financing or refinancing of the Building; fines, interest and penalties incurred
due to the late payment of Taxes or Expenses; organizational expenses associated
with the creation and operation of the entity which constitutes Landlord; or any
penalties or damages that Landlord pays to Tenant under this Lease or to other
tenants in the Building under their respective leases.

                  2.03     If at any time during a calendar year the Building is
not at least 95% occupied or Landlord is not supplying services to at least 95%
of the total Rentable Square Footage of the Building, Expenses shall, at
Landlord's option, be determined as if the Building had been 95% occupied and
Landlord had been supplying services to 95% of the Rentable Square Footage of
the Building. If Expenses for a calendar year are determined as provided in the
prior sentence, Expenses for the Base Year shall also be determined in such
manner. Notwithstanding the foregoing, Landlord may calculate the extrapolation
of Expenses under this Section based on 100% occupancy and service so long as
such percentage is used consistently for each year of the Term. The
extrapolation of Expenses under this Section shall be performed in accordance
with the methodology specified by the Building Owners and Managers Association.

         3.       "TAXES" shall mean: (a) all real property taxes and other
assessments on the Building and/or Property, including, but not limited to,
gross receipts taxes, assessments for special improvement districts and building
improvement districts, governmental charges, fees and assessments for police,
fire, traffic mitigation or other governmental service of purported benefit to
the Property, taxes and assessments levied in substitution or supplementation in
whole or in part of

                                       -2-

<PAGE>

any such taxes and assessments and the Property's share of any real estate taxes
and assessments under any reciprocal easement agreement, common area agreement
or similar agreement as to the Property; (b) all personal property taxes for
property that is owned by Landlord and used in connection with the operation,
maintenance and repair of the Property; and (c) all costs and fees incurred in
connection with seeking reductions in any tax liabilities described in (a) and
(b), including, without limitation, any costs incurred by Landlord for
compliance, review and appeal of tax liabilities. Without limitation, Taxes
shall not include any income, capital levy, transfer, capital stock, gift,
estate or inheritance tax. If a change in Taxes is obtained for any year of the
Term during which Tenant paid Tenant's Pro Rata Share of Taxes, then Taxes for
that year will be retroactively adjusted and Landlord shall provide Tenant with
a credit, if any, based on the adjustment. Likewise, if a change is obtained for
Taxes for the Base Year, Taxes for the Base Year shall be restated and the Tax
Excess for all subsequent years shall be recomputed. Tenant shall pay Landlord
the amount of Tenant's Pro Rata Share of any such increase in Taxes within 30
days after Tenant's receipt of a statement from Landlord.

         4.       AUDIT RIGHTS. Tenant, within 365 days after receiving
Landlord's statement of Expenses, may give Landlord written notice ("REVIEW
NOTICE") that Tenant intends to review Landlord's records of the Expenses for
the calendar year to which the statement applies. Within a reasonable time after
receipt of the Review Notice, Landlord shall make all pertinent records
available for inspection that are reasonably necessary for Tenant to conduct its
review. If any records are maintained at a location other than the management
office for the Building, Tenant may either inspect the records at such other
location or pay for the reasonable cost of copying and shipping the records. If
Tenant retains an agent to review Landlord's records, the agent must be with a
CPA firm licensed to do business in the state or commonwealth where the Property
is located. Tenant shall be solely responsible for all costs, expenses and fees
incurred for the audit. Within 90 days after the records are made available to
Tenant, Tenant shall have the right to give Landlord written notice (an
"OBJECTION NOTICE") stating in reasonable detail any objection to Landlord's
statement of Expenses for that year. If Tenant fails to give Landlord an
Objection Notice within the 90 day period or fails to provide Landlord with a
Review Notice within the 365 day period described above, Tenant shall be deemed
to have approved Landlord's statement of Expenses and shall be barred from
raising any claims regarding the Expenses for that year. The records obtained by
Tenant shall be treated as confidential. In no event shall Tenant be permitted
to examine Landlord's records or to dispute any statement of Expenses unless
Tenant has paid and continues to pay all Rent when due.

                                      -3-

<PAGE>

                                   EXHIBIT C-1

                          INITIAL PREMISES WORK LETTER

         This Exhibit is attached to and made a part of the Lease by and between
CA-TWIN DOLPHIN PLAZA LIMITED PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP
("Landlord") and AVISTAR COMMUNICATIONS CORPORATION, A DELAWARE CORPORATION
("Tenant") for space in the Building located at 555 Twin Dolphin Drive, Redwood
City, California.

         As used in this Work Letter, the "Premises" shall be deemed to mean
Initial Premises, as initially defined in the attached Lease.

         1.       Landlord shall perform improvements to the Premises and to the
common area corridor on the 3rd floor of the Building in accordance with the
plans prepared by Weske Associates dated May 21, 2003 and revised May 29, 2003,
June 17, 2003, July 11, 2003 and July 16, 2003 as attached hereto as EXHIBIT C-3
(the "Plans"). The improvements to be performed by Landlord in accordance with
the Plans are hereinafter referred to as the "Initial Premises Landlord Work."
It is agreed that construction of the Initial Premises Landlord Work will be
completed at Landlord's sole cost and expense (subject to the terms of Section 2
below) using Building standard methods, materials and finishes. Landlord shall
enter into a direct contract for the Initial Premises Landlord Work with a
general contractor selected by Landlord. In addition, Landlord shall have the
right to select and/or approve of any subcontractors used in connection with the
Initial Premises Landlord Work. Landlord's supervision or performance of any
work for or on behalf of Tenant shall not be deemed a representation by Landlord
that the improvements constructed in accordance with the Plans and any revisions
thereto will be adequate for Tenant's use, it being agreed that Tenant shall be
responsible for functionality of design, the configuration of the premises and
the placement of Tenant's furniture, appliances and equipment.

         2.       If Tenant shall request any revisions to the Plans, Landlord
shall have such revisions prepared at Tenant's sole cost and expense and Tenant
shall reimburse Landlord for the cost of preparing any such revisions to the
Plans, plus any applicable state sales or use tax thereon, upon demand. Promptly
upon completion of the revisions, Landlord shall notify Tenant in writing of the
increased cost in the Initial Premises Landlord Work, if any, resulting from
such revisions to the Plans. Tenant, within one Business Day, shall notify
Landlord in writing whether it desires to proceed with such revisions. In the
absence of such written authorization, Landlord shall have the option to
continue work on the Premises disregarding the requested revision. Tenant shall
be responsible for any Tenant Delay in completion of the Premises resulting from
any revision to the Plans. If such revisions result in an increase in the cost
of Initial Premises Landlord Work, such increased costs, plus any applicable
state sales or use tax thereon, shall be payable by Tenant upon demand.
Notwithstanding anything herein to the contrary, all revisions to the Plans
shall be subject to the approval of Landlord.

         3.       Tenant acknowledges that the Initial Premises Landlord Work
shall be not be commenced by Landlord in the Premises until subsequent to the
Commencement Date. Landlord and Tenant agree to cooperate with each other in
order to enable the Landlord Work to be performed in a timely manner and with as
little inconvenience to the operation of Tenant's business as is

<PAGE>

reasonably possible. Notwithstanding anything herein to the contrary, any delay
in the completion of the Landlord Work or inconvenience suffered by Tenant
during the performance of the Landlord Work shall not delay the Commencement nor
shall it subject Landlord to any liability for any loss or damage resulting
therefrom or entitle Tenant to any credit, abatement or adjustment of Rent or
other sums payable under the Lease.

         4.       This Exhibit shall not be deemed applicable to any additional
space added to the Premises at any time or from time to time, whether by any
options under the Lease or otherwise, or to any portion of the original Premises
or any additions to the Premises in the event of a renewal or extension of the
original Term of the Lease, whether by any options under the Lease or otherwise,
unless expressly so provided in the Lease or any amendment or supplement to the
Lease.

                                      -2-

<PAGE>

                                   EXHIBIT C-2

                         ADDITIONAL PREMISES WORK LETTER

         This Exhibit is attached to and made a part of the Lease by and between
CA-TWIN DOLPHIN PLAZA LIMITED PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP
("Landlord") and AVISTAR COMMUNICATIONS CORPORATION, A DELAWARE CORPORATION
("Tenant") for space in the Building located at 555 Twin Dolphin Drive, Redwood
City, California.

         As used in this Work Letter, the "Premises" shall be deemed to mean
Additional Premises, as initially defined in the attached Lease.

         1.       Landlord shall perform improvements to the Premises in
accordance with the plans prepared by Weske Associates dated May 21, 2003 and
revised May 29, 2003, June 17, 2003, July 11, 2003 and July 16, 2003 as attached
hereto as EXHIBIT C-3 (the "Plans"). The improvements to be performed by
Landlord in accordance with the Plans are hereinafter referred to as the
"Additional Premises Landlord Work." It is agreed that construction of the
Additional Premises Landlord Work will be completed at Landlord's sole cost and
expense (subject to the terms of Section 2 below) using Building standard
methods, materials and finishes. Landlord shall enter into a direct contract for
the Additional Premises Landlord Work with a general contractor selected by
Landlord. In addition, Landlord shall have the right to select and/or approve of
any subcontractors used in connection with the Additional Premises Landlord
Work. Landlord's supervision or performance of any work for or on behalf of
Tenant shall not be deemed a representation by Landlord that the improvements
constructed in accordance with the Plans and any revisions thereto will be
adequate for Tenant's use, it being agreed that Tenant shall be responsible for
functionality of design, the configuration of the premises and the placement of
Tenant's furniture, appliances and equipment.

         2.       If Tenant shall request any revisions to the Plans, Landlord
shall have such revisions prepared at Tenant's sole cost and expense and Tenant
shall reimburse Landlord for the cost of preparing any such revisions to the
Plans, plus any applicable state sales or use tax thereon, upon demand. Promptly
upon completion of the revisions, Landlord shall notify Tenant in writing of the
increased cost in the Additional Premises Landlord Work, if any, resulting from
such revisions to the Plans. Tenant, within one Business Day, shall notify
Landlord in writing whether it desires to proceed with such revisions. In the
absence of such written authorization, Landlord shall have the option to
continue work on the Premises disregarding the requested revision. Tenant shall
be responsible for any Tenant Delay in completion of the Premises resulting from
any revision to the Plans. If such revisions result in an increase in the cost
of Additional Premises Landlord Work, such increased costs, plus any applicable
state sales or use tax thereon, shall be payable by Tenant upon demand.
Notwithstanding anything herein to the contrary, all revisions to the Plans
shall be subject to the approval of Landlord.

         3.       This Exhibit shall not be deemed applicable to any additional
space added to the Premises at any time or from time to time, whether by any
options under the Lease or otherwise, or to any portion of the original Premises
or any additions to the Premises in the event of a renewal or extension of the
original Term of the Lease, whether by any options under the Lease or otherwise,
unless expressly so provided in the Lease or any amendment or supplement to the
Lease.

<PAGE>

                                   EXHIBIT C-3

                                      PLANS

         [Diagrams of Partial Third Floor Plan - Suite 360 and Third Floor
Keyplan. Pricing Notes, Partial First Floor Plan - Suite 180 and First Floor
Keyplan].

<PAGE>

                                    EXHIBIT D

                               COMMENCEMENT LETTER

                                    (EXAMPLE)

Date    _______________________________

Tenant  _______________________________
Address _______________________________
        _______________________________
        _______________________________

Re:   Commencement Letter with respect to that certain Lease dated as of the ___
day of _____________, _______, by and between CA-TWIN DOLPHIN PLAZA LIMITED
PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP, as Landlord, and AVISTAR
COMMUNICATIONS CORPORATION, A DELAWARE CORPORATION, as Tenant, for 14,046
rentable square feet on the 1st and 3rd floors of the Building located at 555
Twin Dolphin Drive, Redwood City, California.

Dear ______________________:

         In accordance with the terms and conditions of the above referenced
Lease, Tenant accepts possession of the Premises and agrees:

         1.       The Commencement Date of the Lease is _______________________;

         2.       The Termination Date of the Lease is ________________________.

         Please acknowledge your acceptance of possession and agreement to the
terms set forth above by signing all 3 counterparts of this Commencement Letter
in the space provided and returning 2 fully executed counterparts to my
attention.

Sincerely,

__________________________________________________
Authorized Signatory

Agreed and Accepted:

Tenant:           AVISTAR COMMUNICATIONS CORPORATION,
                  A DELAWARE CORPORATION

         By:     _______________________________
         Name:   _______________________________
         Title:  _______________________________
         Date:   _______________________________

<PAGE>

                                    EXHIBIT E

                         BUILDING RULES AND REGULATIONS

         The following rules and regulations shall apply, where applicable, to
the Premises, the Building, the parking facilities (if any), the Property and
the appurtenances. In the event of a conflict between the following rules and
regulations and the remainder of the terms of the Lease, the remainder of the
terms of the Lease shall control. Capitalized terms have the same meaning as
defined in the Lease.

         1.       Sidewalks, doorways, vestibules, halls, stairways and other
similar areas shall not be obstructed by Tenant or used by Tenant for any
purpose other than ingress and egress to and from the Premises. No rubbish,
litter, trash, or material shall be placed, emptied, or thrown in those areas.
At no time shall Tenant permit Tenant's employees to loiter in Common Areas or
elsewhere about the Building or Property.

         2.       Plumbing fixtures and appliances shall be used only for the
purposes for which designed and no sweepings, rubbish, rags or other unsuitable
material shall be thrown or placed in the fixtures or appliances. Damage
resulting to fixtures or appliances by Tenant, its agents, employees or invitees
shall be paid for by Tenant and Landlord shall not be responsible for the
damage.

         3.       No signs, advertisements or notices shall be painted or
affixed to windows, doors or other parts of the Building, except those of such
color, size, style and in such places as are first approved in writing by
Landlord. All tenant identification and suite numbers at the entrances to the
Premises (and an identification sign on the existing double-doors in the
Additional Premises, subject to Landlord's reasonable approval and to applicable
Laws) shall be installed by Landlord, at Tenant's cost and expense, using the
standard graphics for the Building. Except in connection with the hanging of
lightweight pictures and wall decorations, no nails, hooks or screws shall be
inserted into any part of the Premises or Building except by the Building
maintenance personnel without Landlord's prior approval, which approval shall
not be unreasonably withheld.

         4.       Landlord may provide and maintain in the first floor (main
lobby) of the Building an alphabetical directory board or other directory device
listing tenants and no other directory shall be permitted unless previously
consented to by Landlord in writing.

         5.       Tenant shall not place any lock(s) on any door in the Premises
or Building without Landlord's prior written consent, which consent shall not be
unreasonably withheld, and Landlord shall have the right at all times to retain
and use keys or other access codes or devices to all locks within and into the
Premises. A reasonable number of keys to the locks on the entry doors in the
Premises shall be furnished by Landlord to Tenant at Tenant's cost and Tenant
shall not make any duplicate keys. All keys shall be returned to Landlord at the
expiration or early termination of the Lease.

         6.       All contractors, contractor's representatives and installation
technicians performing work in the Building shall be subject to Landlord's prior
approval, which approval shall not be

<PAGE>

unreasonably withheld, and shall be required to comply with Landlord's standard
rules, regulations, policies and procedures, which may be revised from time to
time.

         7.       Movement in or out of the Building of furniture or office
equipment, or dispatch or receipt by Tenant of merchandise or materials
requiring the use of elevators, stairways, lobby areas or loading dock areas,
shall be restricted to hours reasonably designated by Landlord, provided that
subject to the other provisions hereof, reasonable shipping and receiving
activities within the scope of the Permitted Use may be performed via the
existing double-doors in the Additional Premises on a 24-hour basis. Tenant
shall obtain Landlord's prior approval by providing a detailed listing of the
activity, which approval shall not be unreasonably withheld. If approved by
Landlord, the activity shall be under the supervision of Landlord and performed
in the manner required by Landlord. Tenant shall assume all risk for damage to
articles moved and injury to any persons resulting from the activity. If
equipment, property, or personnel of Landlord or of any other party is damaged
or injured as a result of or in connection with the activity, Tenant shall be
solely liable for any resulting damage, loss or injury.

         8.       Landlord shall have the right to approve the weight, size, or
location of heavy equipment or articles in and about the Premises, which
approval shall not be unreasonably withheld. Damage to the Building by the
installation, maintenance, operation, existence or removal of Tenant's Property
shall be repaired at Tenant's sole expense.

         9.       Corridor doors, when not in use, shall be kept closed.

         10.      Tenant shall not: (1) make or permit any improper,
objectionable or unpleasant noises or odors in the Building, or otherwise
interfere in any way with other tenants or persons having business with them;
(2) solicit business or distribute or cause to be distributed, in any portion of
the Building, handbills, promotional materials or other advertising; or (3)
conduct or permit other activities in the Building that might, in Landlord's
sole opinion, constitute a nuisance.

         11.      No animals, except those assisting handicapped persons, shall
be brought into the Building or kept in or about the Premises.

         12.      No inflammable, explosive or dangerous fluids or substances
shall be used or kept by Tenant in the Premises, Building or about the Property,
except for those substances as are typically found in similar premises used for
general office purposes and are being used by Tenant in a safe manner and in
accordance with all applicable Laws. Tenant shall not, without Landlord's prior
written consent, use, store, install, spill, remove, release or dispose of,
within or about the Premises or any other portion of the Property, any
asbestos-containing materials or any solid, liquid or gaseous material now or
subsequently considered toxic or hazardous under the provisions of 42 U.S.C.
Section 9601 et seq. or any other applicable environmental Law which may now or
later be in effect. Tenant shall comply with all Laws pertaining to and
governing the use of these materials by Tenant and shall remain solely liable
for the costs of abatement and removal.

         13.      Tenant shall not use or occupy the Premises in any manner or
for any purpose which might injure the reputation or impair the present or
future value of the Premises or the Building. Tenant shall not use, or permit
any part of the Premises to be used for lodging, sleeping or for any illegal
purpose.

                                      -2-

<PAGE>

         14.      Tenant shall not take any action which would violate
Landlord's labor contracts or which would cause a work stoppage, picketing,
labor disruption or dispute or interfere with Landlord's or any other tenant's
or occupant's business or with the rights and privileges of any person lawfully
in the Building ("LABOR DISRUPTION"). Tenant shall take the actions necessary to
resolve the Labor Disruption, and shall have pickets removed and, at the request
of Landlord, immediately terminate any work in the Premises that gave rise to
the Labor Disruption, until Landlord gives its written consent for the work to
resume. Tenant shall have no claim for damages against Landlord or any of the
Landlord Related Parties nor shall the Commencement Date of the Term be extended
as a result of the above actions.

         15.      Tenant shall not install, operate or maintain in the Premises
or in any other area of the Building, electrical equipment that would overload
the electrical system beyond its capacity for proper, efficient and safe
operation as determined solely by Landlord. Tenant shall not furnish cooling or
heating to the Premises, including, without limitation, the use of electric or
gas heating devices, without Landlord's prior written consent. Tenant shall not
use more than its proportionate share of telephone lines and other
telecommunication facilities available to service the Building.

         16.      Tenant shall not operate or permit to be operated a coin or
token operated vending machine or similar device (including, without limitation,
telephones, lockers, toilets, scales, amusement devices and machines for sale of
beverages, foods, candy, cigarettes and other goods), except for machines for
the exclusive use of Tenant's employees and invitees.

         17.      Bicycles and other vehicles are not permitted inside the
Building or on the walkways outside the Building, except in areas designated by
Landlord.

         18.      Landlord may from time to time adopt systems and procedures
for the security and safety of the Building and the Property, its occupants,
entry, use and contents. Tenant, its agents, employees, contractors, guests and
invitees shall comply with Landlord's systems and procedures.

         19.      Landlord shall have the right to prohibit the use of the name
of the Building or any other publicity by Tenant that in Landlord's sole opinion
may impair the reputation of the Building or its desirability. Upon written
notice from Landlord, Tenant shall refrain from and discontinue such publicity
immediately.

         20.      Neither Tenant nor its agents, employees, contractors, guests
or invitees shall smoke or permit smoking in the Common Areas, unless a portion
of the Common Areas have been declared a designated smoking area by Landlord,
nor shall the above parties allow smoke from the Premises to emanate into the
Common Areas or any other part of the Building. Landlord shall have the right to
designate the Building (including the Premises) as a non-smoking building.

         21.      Landlord shall have the right to designate and approve
standard window coverings for the Premises and to establish rules to assure that
the Building presents a uniform exterior appearance. Tenant shall ensure, to the
extent reasonably practicable, that window coverings are closed on windows in
the Premises while they are exposed to the direct rays of the sun.

                                      -3-

<PAGE>

         22.      Deliveries to and from the Premises shall be made only at the
times in the areas and through the entrances and exits reasonably designated by
Landlord. Landlord hereby designates the existing double-doors in the Additional
Premises as an approved route for deliveries to and from the Premises. Tenant
shall not make deliveries to or from the Premises in a manner that might
interfere with the use by any other tenant of its premises or of the Common
Areas, any pedestrian use, or any use which is inconsistent with good business
practice.

         23.      The work of cleaning personnel shall not be hindered by Tenant
after 5:30 p.m., and cleaning work may be done at any time when the offices are
vacant. Windows, doors and fixtures may be cleaned at any time. Tenant shall
provide adequate waste and rubbish receptacles to prevent unreasonable hardship
to the cleaning service.

                                      -4-

<PAGE>

                                    EXHIBIT F

                              ADDITIONAL PROVISIONS

         This Exhibit is attached to and made a part of the Lease by and between
CA-TWIN DOLPHIN PLAZA LIMITED PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP
("Landlord") and AVISTAR COMMUNICATIONS CORPORATION, A DELAWARE CORPORATION
("Tenant") for space in the Building located at 555 Twin Dolphin Drive, Redwood
City, California.

         I.       RENEWAL OPTION.

                  A.       Grant of Option; Conditions. Tenant shall have the
right to extend the Term (the "Renewal Option") for one additional period of 5
years commencing on the day following the Termination Date of the initial Term
and ending on the 5th anniversary of the Termination Date (the "Renewal Term"),
if:

                           1.       Landlord receives notice of exercise
("Initial Renewal Notice") not less than 9 full calendar months prior to the
expiration of the initial Term and not more than 12 full calendar months prior
to the expiration of the initial Term; and

                           2.       Tenant is not in default under the Lease
beyond any applicable cure periods at the time that Tenant delivers its Initial
Renewal Notice or at the time Tenant delivers its Binding Notice (as defined
below); and

                           3.       No part of the Premises is sublet (other
than pursuant to a Permitted Transfer, as defined in Article XII of the Lease)
at the time that Tenant delivers its Initial Renewal Notice or at the time
Tenant delivers its Binding Notice; and

                           4.       The Lease has not been assigned (other than
pursuant to a Permitted Transfer, as defined in Article XII of the Lease) prior
to the date that Tenant delivers its Initial Renewal Notice or prior to the date
Tenant delivers its Binding Notice.

                  B.       Terms Applicable to Premises During Renewal Term.

                           1.       The initial Base Rent rate per rentable
square foot for the Premises during the Renewal Term shall equal the Prevailing
Market (hereinafter defined) rate per rentable square foot for the Premises.
Base Rent during the Renewal Term shall increase, if at all, in accordance with
the increases assumed in the determination of Prevailing Market rate. Base Rent
attributable to the Premises shall be payable in monthly installments in
accordance with the terms and conditions of Article IV of the Lease.

                           2.       Tenant shall pay Additional Rent (i.e. Taxes
and Expenses) for the Premises during the Renewal Term in accordance with
Article IV of the Lease, and the manner and method in which Tenant reimburses
Landlord for Tenant's share of Taxes and Expenses and the Base Year, if any,
applicable to such matter, shall be some of the factors considered in
determining the Prevailing Market rate for the Renewal Term.

<PAGE>

                  C.       Procedure for Determining Prevailing Market. Within
30 days after receipt of Tenant's Initial Renewal Notice, Landlord shall advise
Tenant of the applicable Base Rent rate for the Premises for the Renewal Term.
Tenant, within 15 days after the date on which Landlord advises Tenant of the
applicable Base Rent rate for the Renewal Term, shall either (i) give Landlord
final binding written notice ("Binding Notice") of Tenant's exercise of its
Renewal Option, or (ii) if Tenant disagrees with Landlord's determination,
provide Landlord with written notice of rejection (the "Rejection Notice"). If
Tenant fails to provide Landlord with either a Binding Notice or Rejection
Notice within such 15 day period, Tenant's Renewal Option shall be null and void
and of no further force and effect. If Tenant provides Landlord with a Binding
Notice, Landlord and Tenant shall enter into the Renewal Amendment (as defined
below) upon the terms and conditions set forth herein. If Tenant provides
Landlord with a Rejection Notice, Landlord and Tenant shall work together in
good faith to agree upon the Prevailing Market rate for the Premises during the
Renewal Term. Upon agreement, Tenant shall provide Landlord with Binding Notice
and Landlord and Tenant shall enter into the Renewal Amendment in accordance
with the terms and conditions hereof. Notwithstanding the foregoing, if Landlord
and Tenant fail to agree upon the Prevailing Market rate within 30 days after
the date Tenant provides Landlord with the Rejection Notice, Tenant, by written
notice to Landlord (the "Arbitration Notice") within 5 days after the expiration
of such 30 day period, shall have the right to have the Prevailing Market rate
determined in accordance with the arbitration procedures described in Section D
below. If Landlord and Tenant fail to agree upon the Prevailing Market rate
within the 30 day period described and Tenant fails to timely exercise its right
to arbitrate, Tenant's Renewal Option shall be deemed to be null and void and of
no further force and effect.

                  D.       Arbitration Procedure.

                           1.       If Tenant provides Landlord with an
Arbitration Notice, Landlord and Tenant, within 5 days after the date of the
Arbitration Notice, shall each simultaneously submit to the other, in a sealed
envelope, its good faith estimate of the Prevailing Market rate for the Premises
during the Renewal Term (collectively referred to as the "Estimates"). If the
higher of such Estimates is not more than 105% of the lower of such Estimates,
then Prevailing Market rate shall be the average of the two Estimates. If the
Prevailing Market rate is not resolved by the exchange of Estimates, then,
within 7 days after the exchange of Estimates, Landlord and Tenant shall each
select an appraiser to determine which of the two Estimates most closely
reflects the Prevailing Market rate for the Premises during the Renewal Term.
Each appraiser so selected shall be certified as an MAI appraiser or as an ASA
appraiser and shall have had at least 5 years experience within the previous 10
years as a real estate appraiser working in the Redwood Shores area, with
working knowledge of current rental rates and practices. For purposes hereof, an
"MAI" appraiser means an individual who holds an MAI designation conferred by,
and is an independent member of, the American Institute of Real Estate
Appraisers (or its successor organization, or in the event there is no successor
organization, the organization and designation most similar), and an "ASA"
appraiser means an individual who holds the Senior Member designation conferred
by, and is an independent member of, the American Society of Appraisers (or its
successor organization, or, in the event there is no successor organization, the
organization and designation most similar).

                           2.       Upon selection, Landlord's and Tenant's
appraisers shall work together in good faith to agree upon the Prevailing Market
rate for the Premises (which Prevailing Market

                                      -2-

<PAGE>

Rate shall in no event be less than the lower of the two Estimates or in excess
of the higher of the two Estimates). The Prevailing Market rate chosen by such
appraisers shall be binding on both Landlord and Tenant as the Base Rent rate
for the Premises during the Renewal Term. If either Landlord or Tenant fails to
appoint an appraiser within the 7 day period referred to above, the appraiser
appointed by the other party shall be the sole appraiser for the purposes
hereof. If the two appraisers cannot agree upon the Prevailing Market rate
within 20 days after their appointment, then, within 10 days after the
expiration of such 20 day period, the two appraisers shall select a third
appraiser meeting the aforementioned criteria. Once the third appraiser (i.e.
arbitrator) has been selected as provided for above, then, as soon thereafter as
practicable but in any case within 14 days, the arbitrator shall make his
determination of the Prevailing Market rate and such determination shall be
binding on both Landlord and Tenant as the Base Rent rate for the Premises. The
foregoing determination by the third appraiser (i.e. arbitrator) shall in no
event be less than the lower of the two Estimates or in excess of the higher of
the two Estimates. If the arbitrator believes that expert advice would
materially assist him, he may retain one or more qualified persons to provide
such expert advice. The parties shall share equally in the costs of the
arbitrator and of any experts retained by the arbitrator. Any fees of any
appraiser, counsel or experts engaged directly by Landlord or Tenant, however,
shall be borne by the party retaining such appraiser, counsel or expert.

                           3.       If the Prevailing Market rate has not been
determined by the commencement date of the Renewal Term, Tenant shall pay Base
Rent upon the terms and conditions in effect during the last month of the
initial Term for the Premises until such time as the Prevailing Market rate has
been determined. Upon such determination, the Base Rent for the Premises shall
be retroactively adjusted to the commencement of the Renewal Term for the
Premises. If such adjustment results in an underpayment of Base Rent by Tenant,
Tenant shall pay Landlord the amount of such underpayment within 30 days after
the determination thereof. If such adjustment results in an overpayment of Base
Rent by Tenant, Landlord shall credit such overpayment against the next
installment of Base Rent due under the Lease and, to the extent necessary, any
subsequent installments, until the entire amount of such overpayment has been
credited against Base Rent.

                  E.       Renewal Amendment. If Tenant is entitled to and
properly exercises its Renewal Option, Landlord shall prepare an amendment (the
"Renewal Amendment") to reflect changes in the Base Rent, Term, Termination Date
and other appropriate terms. The Renewal Amendment shall be sent to Tenant
within a reasonable time after receipt of the Binding Notice and Tenant shall
execute and return the Renewal Amendment to Landlord within 15 days after
Tenant's receipt of same, but, upon final determination of the Prevailing Market
rate applicable during the Renewal Term as described herein, an otherwise valid
exercise of the Renewal Option shall be fully effective whether or not the
Renewal Amendment is executed.

                  F.       Definition of Prevailing Market. For purposes of this
Renewal Option, "Prevailing Market" shall mean the arms length fair market
annual rental rate per rentable square foot under renewal leases and amendments
entered into on or about the date on which the Prevailing Market is being
determined hereunder for space comparable to the Premises in the Building and
office buildings comparable to the Building in the Redwood Shores area. The
determination of Prevailing Market shall take into account any material economic
differences between the terms of this Lease and any comparison lease or
amendment, such as rent abatements, construction costs and

                                      -3-

<PAGE>

other concessions and the manner, if any, in which the landlord under any such
lease is reimbursed for operating expenses and taxes. The determination of
Prevailing Market shall also take into consideration any reasonably anticipated
changes in the Prevailing Market rate from the time such Prevailing Market rate
is being determined and the time such Prevailing Market rate will become
effective under this Lease.

                  G.       Subordination. Notwithstanding anything herein to the
contrary, Tenant's Renewal Option is subject and subordinate to the expansion
rights (whether such rights are designated as a right of first offer, right of
first refusal, expansion option or otherwise) of any tenant of the Building
existing on the date hereof.

                                      -4-

<PAGE>

                                    EXHIBIT G

                                PARKING AGREEMENT

         This Exhibit (the "PARKING AGREEMENT") is attached to and made a part
of the Lease by and between CA-TWIN DOLPHIN PLAZA LIMITED PARTNERSHIP, A
DELAWARE LIMITED PARTNERSHIP ("Landlord") and AVISTAR COMMUNICATIONS
CORPORATION, A DELAWARE CORPORATION ("Tenant") for space in the Building located
at 555 Twin Dolphin Drive, Redwood City, California.

         1.       The capitalized terms used in this Parking Agreement shall
have the same definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this Parking
Agreement. In the event of any conflict between the Lease and this Parking
Agreement, the latter shall control.

         2.       During the initial Term, Tenant agrees to lease from Landlord
and Landlord agrees to lease to Tenant a total of 46 non-reserved parking spaces
and 2 reserved parking spaces (in the reserved locations shown on EXHIBIT G-1
attached hereto) in the surface parking lot servicing the Building, and 11
non-reserved parking spaces in the covered garage servicing the Building
(collectively, the "PARKING FACILITY"). The charge for such parking spaces
during the initial Term is $0 per nonreserved parking pass, per month, and $0
per reserved parking pass, per month. No deductions from the monthly charge
shall be made for days on which the Parking Facility is not used by Tenant.
Tenant may, from time to time request additional parking spaces, and if Landlord
shall provide the same, such parking spaces shall be provided and used on a
month-to-month basis, and otherwise on the foregoing terms and provisions, and
at such prevailing monthly parking charges as shall be established from time to
time.

         3.       Tenant shall at all times comply with all applicable
ordinances, rules, regulations, codes, laws, statutes and requirements of all
federal, state, county and municipal governmental bodies or their subdivisions
respecting the use of the Parking Facility. Landlord reserves the right to
adopt, modify and enforce reasonable rules ("RULES") governing the use of the
Parking Facility from time to time including any key-card, sticker or other
identification or entrance system and hours of operation. The Rules set forth
herein are currently in effect. Landlord may refuse to permit any person who
violates such Rules to park in the Parking Facility, and any violation of the
Rules shall subject the car to removal from the Parking Facility.

         4.       Unless specified to the contrary above, the parking spaces
hereunder shall be provided on a nondesignated "first-come, first-served" basis.
Tenant acknowledges that Landlord has no liability for claims arising through
acts or omissions of any independent operator of the Parking Facility. Landlord
shall have no liability whatsoever for any damage to items located in the
Parking Facility, nor for any personal injuries or death arising out of any
matter relating to the Parking Facility, and in all events, Tenant agrees to
look first to its insurance carrier and to require that Tenant's employees look
first to their respective insurance carriers for payment of any losses sustained
in connection with any use of the Parking Facility. Tenant hereby waives on
behalf of its insurance carriers all rights of subrogation against Landlord or
Landlord's agents. Landlord reserves the right to assign specific parking
spaces, and to reserve parking spaces for visitors, small cars, handicapped
persons and for other tenants, guests of tenants or other parties, which
assignment and

<PAGE>

reservation or spaces may be relocated as determined by Landlord from time to
time, and Tenant and persons designated by Tenant hereunder shall not park in
any location designated for such assigned or reserved parking spaces. Tenant
acknowledges that the Parking Facility may be closed entirely or in part in
order to make repairs or perform maintenance services, or to alter, modify,
re-stripe or renovate the Parking Facility, or if required by casualty, strike,
condemnation, act of God, governmental law or requirement or other reason beyond
the operator's reasonable control. In such event, Landlord shall refund any
prepaid parking fee hereunder, prorated on a per diem basis.

         5.       If Tenant shall default under this Parking Agreement, the
operator shall have the right to remove from the Parking Facility any vehicles
hereunder which shall have been involved or shall have been owned or driven by
parties involved in causing such default, without liability therefor whatsoever.
In addition, if Tenant shall default under this Parking Agreement, Landlord
shall have the right to cancel this Parking Agreement on 20 days' written
notice, unless within such 20 day period, Tenant cures such default. If Tenant
defaults with respect to the same term or condition under this Parking Agreement
more than 5 times during any 12 month period, and Landlord notifies Tenant
thereof promptly after each such default, the next default of such term or
condition during the succeeding 12 month period, shall, at Landlord's election,
constitute an incurable default. Such cancellation right shall be cumulative and
in addition to any other rights or remedies available to Landlord at law or
equity, or provided under the Lease (all of which rights and remedies under the
Lease are hereby incorporated herein, as though fully set forth). Any default by
Tenant under the Lease shall be a default under this Parking Agreement.

                                      -2-

<PAGE>

                                      RULES

                  (i)      Tenant shall have access to the Parking Facility on a
24-hour basis, 7 days a week, subject to the other terms of this Parking
Agreement. Tenant shall not store or permit its employees to store any
automobiles in the Parking Facility without the prior written consent of the
operator. Except for emergency repairs, Tenant and its employees shall not
perform any work on any automobiles while located in the Parking Facility, or on
the Property. If it is necessary for Tenant or its employees to leave an
automobile in the Parking Facility overnight, Tenant shall provide the operator
with prior notice thereof designating the license plate number and model of such
automobile.

                  (ii)     Cars must be parked entirely within the stall lines
painted on the floor, and only small cars may be parked in areas reserved for
small cars.

                  (iii)    All directional signs and arrows must be observed.

                  (iv)     The speed limit shall be 5 miles per hour.

                  (v)      Parking spaces reserved for handicapped persons must
be used only by vehicles properly designated.

                  (vi)     Parking is prohibited in all areas not expressly
designated for parking, including without limitation:

                           (a)      Areas not striped for parking

                           (b)      Aisles

                           (c)      where "no parking" signs are posted

                           (d)      ramps

                           (e)      loading zones

                  (vii)    Parking stickers, key cards or any other devices or
forms of identification or entry supplied by the operator shall remain the
property of the operator. Such device must be displayed as requested and may not
be mutilated in any manner. The serial number of the parking identification
device may not be obliterated. Parking passes and devices are not transferable
and any pass or device in the possession of an unauthorized holder will be void.

                  (viii)   Monthly fees shall be payable in advance prior to the
first day of each month. Failure to do so will automatically cancel parking
privileges and a charge at the prevailing daily parking rate will be due. No
deductions or allowances from the monthly rate will be made for days on which
the Parking Facility is not used by Tenant or its designees.

                  (ix)     Parking Facility managers or attendants are not
authorized to make or allow any exceptions to these Rules.

                  (x)      Every parker is required to park and lock his/her own
car.

                  (xi)     Loss or theft of parking pass, identification, key
cards or other such devices must be reported to Landlord and to the Parking
Facility manager immediately. Any parking devices

                                      -3-

<PAGE>

reported lost or stolen found on any authorized car will be confiscated and the
illegal holder will be subject to prosecution. Lost or stolen passes and devices
found by Tenant or its employees must be reported to the office of the Parking
Facility immediately.

                  (xii)    Washing, waxing, cleaning or servicing of any vehicle
by the customer and/or his agents is prohibited. Parking spaces may be used only
for parking automobiles.

                  (xiii)   Tenant agrees to acquaint all persons to whom Tenant
assigns a parking space with these Rules.

         6.       TENANT ACKNOWLEDGES AND AGREES THAT, TO THE FULLEST EXTENT
PERMITTED BY LAW, LANDLORD SHALL NOT BE RESPONSIBLE FOR ANY LOSS OR DAMAGE TO
TENANT OR TENANT'S PROPERTY (INCLUDING, WITHOUT LIMITATIONS, ANY LOSS OR DAMAGE
TO TENANT'S AUTOMOBILE OR THE CONTENTS THEREOF DUE TO THEFT, VANDALISM OR
ACCIDENT) ARISING FROM OR RELATED TO TENANT'S USE OF THE PARKING FACILITY OR
EXERCISE OF ANY RIGHTS UNDER THIS PARKING AGREEMENT, WHETHER OR NOT SUCH LOSS OR
DAMAGE RESULTS FROM LANDLORD'S ACTIVE NEGLIGENCE OR NEGLIGENT OMISSION. THE
LIMITATION ON LANDLORD'S LIABILITY UNDER THE PRECEDING SENTENCE SHALL NOT APPLY
HOWEVER TO LOSS OR DAMAGE ARISING DIRECTLY FROM LANDLORD'S WILLFUL MISCONDUCT OR
GROSS NEGLIGENCE.

         7.       Without limiting the provisions of Paragraph 6 above, Tenant
hereby voluntarily releases, discharges, waives and relinquishes any and all
actions or causes of action for personal injury or property damage occurring to
Tenant arising as a result of parking in the Parking Facility, or any activities
incidental thereto, wherever or however the same may occur, and further agrees
that Tenant will not prosecute any claim for personal injury or property damage
against Landlord or any of its officers, agents, servants or employees for any
said causes of action. It is the intention of Tenant by this instrument, to
exempt and relieve Landlord from liability for personal injury or property
damage caused by negligence.

         8.       The provisions of Section 20 of the Lease are hereby
incorporated by reference as if fully recited.

         Tenant acknowledges that Tenant has read the provisions of this Parking
Agreement, has been fully and completely advised of the potential dangers
incidental to parking in the Parking Facility and is fully aware of the legal
consequences of agreeing to this instrument.

                                      -4-

<PAGE>

                                   EXHIBIT G-1

                       LOCATION OF RESERVED PARKING SPACES

         [Diagram of the location of Avistar parking spaces at 555 Twin Dolphin
Drive, Redwood City].

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