Document:

<PAGE>
                                                                   EXHIBIT 10.16

                                FOURTH AMENDMENT

        THIS FOURTH AMENDMENT (the "Amendment") is made and entered into as of
the 13th day of September, 2002, by and between EOP-SUNSET NORTH BELLEVUE,
L.L.C., A WASHINGTON LIMITED LIABILITY COMPANY ("Landlord"), and BSQUARE
CORPORATION, A WASHINGTON CORPORATION ("Tenant").

                                    RECITALS

A.  Landlord (as successor in interest to WRC Sunset North LLC, a Washington
    limited liability company) and Tenant are parties to that certain lease
    dated as of January 15, 1999, which lease has been previously amended by
    instruments dated October 19, 1999 ("Commencement Letter"), July 27, 1999
    (the "First Amendment"), January 3, 2001 (the "Second Amendment") and April
    2, 2001 (the Third Amendment") (collectively, the "Lease"). Pursuant to the
    Lease, Landlord has leased to Tenant space currently containing
    approximately 149,487 rentable square feet (the "Original Premises") on the
    1st, 2nd, 3rd, 4th and 5th floors of the building commonly known as Building
    4 of the Sunset North Corporate Campus located at the Northeast corner of
    139th Avenue Southeast and Southeast 32nd Street, Bellevue, Washington (the
    "Building").

B.  The Term is scheduled to expire on September 30, 2009 (the "Stated
    Termination Date"). Tenant desires to surrender portions of the Premises to
    Landlord, in stages as more fully set forth below, containing approximately
    25,803 rentable square feet described as Suite No. 100 on the 1st floor of
    the Building ("First Reduction Space") and 30,921 rentable square feet
    described as Suite No. 200 on the 2nd floor of the Building ("Second
    Reduction Space"), all as more fully shown on EXHIBIT A hereto
    (collectively, the "Reduction Spaces") and further desires to terminate the
    Lease prior to the Stated Termination Date. Landlord has agreed that, if
    Landlord obtains another tenant ("New Tenant") interested in leasing the
    Reduction Spaces with an effective date on or about the respective First and
    Second Reduction Effective Dates and the Early Termination Date (as defined
    below) to be evidenced by a formal lease agreement between Landlord and New
    Tenant (the "New Tenant Agreement"), then Landlord shall agree to the
    reduction and early termination of the Lease on the terms and conditions
    contained in this Amendment.

    NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:

I.  REDUCTION.

    A. (i)     Tenant shall vacate the First Reduction Space in accordance with
               the terms of the Lease on or prior to September 30, 2002, which
               is the date immediately preceding the First Reduction Effective
               Date (defined in Section I.B.(i) below) and Tenant shall fully
               comply with all obligations under the Lease respecting the First
               Reduction Space up to the First Reduction Effective Date,
               including those provisions relating to the condition of the First
               Reduction Space and removal of Tenant's Property therefrom,
               subject to the following: (i) Tenant shall have no obligation to
               remove any of the furniture to be transferred to New Tenant
               pursuant to any agreement between Tenant and New Tenant, a
               schedule of which furniture (the "Furniture") is attached as
               EXHIBIT E, and incorporated herein; (ii) all Leasehold
               Improvements and other changes, improvements, additions and/or
               alterations made to the First Reduction Space by or for Tenant
               (except as set forth in (iii) below) shall remain with the
               Building and shall not be required to be removed upon vacation of
               the First Reduction Space by Tenant, except to the extent Tenant
               and New Tenant agree in writing that a corridor for Tenant access
               to the dock area is required in which case Tenant shall bear the
               cost (to be reasonable in amount) for the installation and
               demolition thereof; (iii) Tenant shall have the right to remove
               from the First Reduction Space, and to retain as Tenant's
               property (subject to the terms of EXHIBIT B attached hereto),
               those items listed on EXHIBIT B, attached hereto and incorporated
               herein by this reference, and (iv) in leasing the First Reduction
               Space to the New Tenant, or others, Landlord shall except from
               the definition of "premises" in any such lease the exclusive use
               of the electrical and telecommunications rooms, the first floor
               elevator lobby, elevators, and exclusive access to the loading
               dock, which access shall be only as agreed to by New Tenant and
               Tenant and

                                       1

<PAGE>

               cause all of such areas to be and remain limited common areas,
               reasonably accessible by Tenant on a non-exclusive basis through
               the Early Termination Date or earlier termination of Tenant's
               Lease, in connection with Tenant's use of Tenant's Premises.
               Notwithstanding the foregoing, no later than 30 days prior to the
               First Reduction Effective Date, Tenant shall permit New Tenant,
               free and unlimited (except as expressly provided herein) access
               to the entire First Reduction Space (except for the mail room,
               which Tenant shall continue to have access to only until a mail
               room area is constructed on garage level A which is expected to
               occur on or about October 1, 2002, as discussed below) for the
               purpose of refurbishing the First Reduction Space, completing
               tenant improvements, installing furniture, fixtures and
               equipment, cabling and telephone installations, which access
               shall not be deemed an early termination of the Lease and Tenant
               shall be responsible for all obligations under the Lease through
               and including the First Reduction Effective Date. To the extent
               not caused by Tenant, Landlord hereby releases Tenant from and
               against all damages, claims and causes of action arising out of
               or relating to any breach of the Lease caused by the New Tenant
               in connection with its occupancy of the First Reduction Space
               prior to the First Reduction Effective Date (in the case of any
               breach of the Lease caused by both Tenant and New Tenant, the
               release set forth above shall not constitute a release of Tenant
               for a breach of the Lease caused by Tenant).

               Effective on or before the First Reduction Effective Date,
               Landlord will (i) install and make available to Tenant and
               others, mailboxes in the Building at a location reasonably
               acceptable to the Postal Service and accessible and usable by
               Tenant, which is anticipated to be located in garage level A,
               (ii) locate and designate a delivery parking area, in an area
               reasonably selected by Landlord, for UPS, FedEx, and other
               suppliers and deliveries for use by and for Tenant and others,
               and will make reasonable access to the Building available to all
               such delivery persons for such deliveries, (iii) provide standard
               building signage in the Building lobby identifying the floors
               Tenant is occupying, and (iv) require that New Tenant allow
               Tenant reasonable and limited access to and use of the loading
               dock as reasonably needed by Tenant for deliveries to and from
               Tenant's Premises (which is anticipated to be approximately once
               a month), and for final move out by Tenant at the expiration of
               the Lease, which access and use shall be agreed to solely and
               directly by and between Tenant and New Tenant and for which
               Landlord shall have no liability for any alleged or actual loss,
               claim or damage incurred by either Tenant or New Tenant unless
               due to the gross negligence or willful misconduct of Landlord.

       (ii)    Tenant shall vacate the Second Reduction Space in accordance with
               the terms of the Lease on or prior to December 31, 2002, which is
               the date immediately preceding the Second Reduction Effective
               Date (defined in Section I.B.(ii) below) and Tenant shall fully
               comply with all obligations under the Lease respecting the Second
               Reduction Space up to the Second Reduction Effective Date,
               including those provisions relating to the condition of the
               Second Reduction Space and removal of Tenant's Property
               therefrom, subject to the following: (i) Tenant shall have no
               obligation to remove any of the Furniture; (ii) all Leasehold
               Improvements and other changes, improvements, additions and/or
               alterations made to the Second Reduction Space by or for Tenant
               (except as set forth in (iii) below) shall remain with the
               Building and shall not be required to be removed upon vacation of
               the Second Reduction Space by Tenant, except to the extent Tenant
               and New Tenant agree a corridor for Tenant access to the dock
               area is required in which case Tenant shall bear the reasonable
               cost for the installation and demolition thereof; and (iii)
               Tenant shall have the right to remove from the Second Reduction
               Space, and to retain as Tenant's property, those items listed on
               EXHIBIT B, attached hereto and incorporated herein by this
               reference. Notwithstanding the foregoing, no later than 30 days
               prior to the Second Reduction Effective Date, Tenant shall permit
               New Tenant, free and unlimited (except as expressly provided
               herein) access to the entire Second Reduction Space for the
               purpose of refurbishing the Second Reduction Space, completing
               tenant improvements, installing furniture, fixtures and
               equipment, cabling and telephone installations, which access
               shall not be deemed an early

                                       2

<PAGE>

               termination of the Lease and Tenant shall be responsible for all
               obligations under the Lease through and including the Second
               Reduction Effective Date. To the extent not caused by Tenant,
               Landlord hereby releases Tenant from and against all damages,
               claims and causes of action arising out of or relating to any
               breach of the Lease caused by the New Tenant in connection with
               its occupancy of the Second Reduction Space prior to the Second
               Reduction Effective Date (in the case of any such breach of the
               Lease caused by both Tenant and New Tenant, the release set forth
               above shall not constitute a release of Tenant for a breach of
               the Lease caused by Tenant.

               Effective on or before the Second Reduction Effective Date,
               Landlord will modify the standard Building signage in the
               Building lobby identifying the floors Tenant is occupying.

    B. (i)     Effective as of October 1, 2002 (the "First Reduction Effective
               Date"), the Premises is decreased from 149,487 rentable square
               feet on the 1st, 2nd, 3rd, 4th and 5th floors to 123,684 rentable
               square feet on the 2nd, 3rd, 4th and 5th floors by the
               elimination of the First Reduction Space. As of the First
               Reduction Effective Date, the First Reduction Space shall be
               deemed surrendered by Tenant to Landlord, the Lease shall be
               deemed terminated with respect to the First Reduction Space, and
               the "Premises", as defined in the Lease, shall be deemed to mean
               the Original Premises, less the First Reduction Space; provided,
               if Tenant shall violate any provision hereof or if Tenant's
               representations herein shall be false or materially misleading,
               Landlord shall have the right, in its sole discretion, to declare
               this Amendment null and void and to reinstate the Lease with
               respect to the First Reduction Space in addition to, and not in
               lieu of, any other rights or remedies available to Landlord.

       (ii)    Effective as of January 1, 2003 (the "Second Reduction Effective
               Date"), the Premises is decreased from 123,684 rentable square
               feet on the 2nd, 3rd, 4th and 5th floors to 92,763 rentable
               square feet on the 3rd, 4th and 5th floors by the elimination of
               the Second Reduction Space. As of the Second Reduction Effective
               Date, the Second Reduction Space shall be deemed surrendered by
               Tenant to Landlord, the Lease shall be deemed terminated with
               respect to the Second Reduction Space, and the "Premises", as
               defined in the Lease, shall be deemed to mean the Original
               Premises, less the Reduction Spaces; provided, if Tenant shall
               violate any provision hereof or if Tenant's representations
               herein shall be false or materially misleading, Landlord shall
               have the right, in its sole discretion, to declare this Amendment
               null and void and to reinstate the Lease with respect to the
               Second Reduction Space in addition to, and not in lieu of, any
               other rights or remedies available to Landlord.

    C.  If Tenant shall holdover in the First Reduction Space or Second
        Reduction Space beyond the day immediately preceding the First Reduction
        Effective Date or Second Reduction Effective Date, respectively, Tenant
        shall be liable for Base Rental, Additional Base Rent and other charges
        respecting the First Reduction Space and/or Second Reduction Space, as
        applicable, equal to twice the amount in effect under the Lease prorated
        on a per diem basis and on a per square foot basis for the First
        Reduction Space and/or Second Reduction Space, respectively, and which
        shall control over any provision for holdover rent set forth in Article
        31 of the Lease. Such holdover amount shall not be in limitation of
        Tenant's liability for consequential or other damages arising from
        Tenant's holding over nor shall it be deemed permission for Tenant to
        holdover in the Reduction Spaces. If Landlord shall install a wall
        separating the Reduction Spaces from the balance of the Premises or
        otherwise incur expense in installing separate utility meters or
        effecting similar separations, Tenant, upon demand, shall reimburse
        Landlord's reasonable costs in connection therewith.

                                       3

<PAGE>

II. BASE RENTAL.

        A.  FIRST REDUCTION EFFECTIVE DATE. As of the First Reduction Effective
            Date, the schedule of Base Rental contained in the Lease is deleted,
            and the following is substituted therefor:

<TABLE>
<CAPTION>
                                ANNUAL RATE              ANNUAL               MONTHLY
     PERIOD                   PER SQUARE FOOT          BASE RENTAL          BASE RENTAL
-----------------             ---------------          -----------          ------------
<S>                           <C>                      <C>                  <C>
10/1/2002 -- 9/30/2004              $22.00             $2,721,048.00        $226,754.00

10/1/2004 -- 12/31/2004
(THE EARLY TERMINATION
DATE, DEFINED BELOW)                $23.00             $2,844,732.00        $237,061.00

</TABLE>

        B.  SECOND REDUCTION EFFECTIVE DATE. As of the Second Reduction
            Effective Date, the schedule of Base Rental contained in the Lease
            is deleted, and the following is substituted therefor:

<TABLE>
<CAPTION>
                                ANNUAL RATE              ANNUAL               MONTHLY
     PERIOD                   PER SQUARE FOOT          BASE RENTAL          BASE RENTAL
-----------------             ---------------          -----------          ------------
<S>                           <C>                      <C>                  <C>
1/1/2003 -- 9/30/2004               $22.00             $2,040,786.00        $170,065.50

10/1/2004 -- 12/31/2004
(THE EARLY TERMINATION DATE,
DEFINED BELOW)                      $23.00             $2,133,549.00         $177,795.75

</TABLE>

        All such Base Rental shall be payable by Tenant in accordance with the
        terms of the Lease.

III.    TENANT'S PRO RATA SHARE. For the period commencing on the First
        Reduction Effective Date and ending on the day prior to the Second
        Reduction Effective Date, Tenant's Pro Rata Share is decreased from
        32.1469% to 26.5980%. For the period commencing on the Second Reduction
        Effective Date and ending on the Early Termination Date (as defined
        below), Tenant's Pro Rata Share is decreased from 26.5980% to 19.9485%.
        Notwithstanding anything in this Amendment to the contrary, Tenant shall
        remain liable for all year-end adjustments with respect to Tenant's
        Pro-Rata Share of Basic Costs and Taxes applicable to the Reduction
        Spaces for that portion of the calendar year preceding the First
        Reduction Effective Date, Second Reduction Effective Date and the Early
        Termination Date (defined below). Such adjustments shall be paid at the
        time, in the manner and otherwise in accordance with the terms of the
        Lease, unless otherwise specified herein.

IV.     ADDITIONAL SECURITY DEPOSIT. On or before the date the first installment
        of the Termination Fee is due and payable pursuant to Section V.F below,
        Tenant shall pay Landlord the sum of $2,096,666.67 (the "Additional
        Security Deposit") which is added to and becomes part of the Security
        Deposit currently held by Landlord as provided under Section 9 of the
        Lease as security for payment of Rent and the performance of the other
        terms and conditions of the Lease by Tenant, other than those
        obligations arising out of the Termination Fee payable by Tenant
        hereunder, as defined below. Accordingly, the Security Deposit shall be
        increased from $803,333.33 (which is in the form of (x) an irrevocable
        Letter of Credit in the amount of $668,333.33, which Letter of Credit
        shall immediately be extended, by amendment, for no less than 60 days
        and then substituted or consolidated into a single letter of credit with
        the Additional Letter of Credit (defined below), and (y) cash in the
        amount of $135,000.00) to $ 2,900,000.00. The Additional Security
        Deposit shall be in the form of an irrevocable letter of credit (the
        "Additional Letter of Credit"), which Additional Letter of Credit shall:
        (a) be in the amount of $2,096,666.67; (b) be issued on substantially
        the form attached hereto as EXHIBIT C; (c) name Landlord as its
        beneficiary; and (d) be drawn on an FDIC insured financial institution
        reasonably satisfactory to the Landlord. The Additional Letter of Credit
        (and any renewals or replacements thereof) shall be for a term of not
        less than 1 year or for a term expiring 45 days after the Early
        Termination Date, if less than one year remains on the Lease. Tenant
        agrees that it shall from time to time, as necessary, whether as a
        result of a draw on the Additional Letter of Credit by Landlord pursuant
        to the terms hereof or as a result of the expiration of the Additional
        Letter of Credit then in effect, renew or replace the original and any
        subsequent Additional Letter of Credit so that an Additional

                                       4

<PAGE>

        Letter of Credit, in the amount required hereunder, is in effect until a
        date which is at least 45 days after the Early Termination Date of the
        Lease. If Tenant fails to furnish such renewal or replacement Additional
        Letter of Credit at least 45 days prior to the stated expiration date of
        the Additional Letter of Credit then held by Landlord, Landlord may draw
        upon such Additional Letter of Credit and hold the proceeds thereof (and
        such proceeds need not be segregated) as a Security Deposit pursuant to
        the terms of Section 9 of the Lease. Any renewal or replacement of the
        original or any subsequent Additional Letter of Credit shall meet the
        requirements for the original Additional Letter of Credit as set forth
        above, except that such replacement or renewal shall be issued by an
        FDIC insured financial institution reasonably satisfactory to the
        Landlord at the time of the issuance thereof.

        Subject to the remaining terms of this Section IV, and provided Tenant
        has timely paid all Rent due under this Lease during the period
        immediately preceding the effective date of any reduction of the
        Security Deposit, Tenant shall have the right to reduce the amount of
        the Security Deposit (i.e., the Additional Letter of Credit and existing
        Letter of Credit) so that the total reduced Security Deposit secured by
        the Letter of Credit and Additional Letter of Credit amounts will be as
        follows: (i) $2,200,000.00 effective as of April 1, 2004; (ii)
        $1,475,000.00 effective as of July 1, 2004; and (iii) $750,000.00
        effective as of October 1, 2004. If Tenant is not entitled to reduce the
        Security Deposit (i.e., the Letter of Credit and the Additional Letter
        of Credit) as of a particular reduction effective date due to Tenant's
        failure to timely pay all Rent during the months prior to that
        particular reduction effective date, then any subsequent reduction(s)
        Tenant is entitled to hereunder shall be reduced by the amount of the
        reduction Tenant would have been entitled to had Tenant timely paid all
        Rent during the months prior to that particular earlier reduction
        effective date. Notwithstanding anything to the contrary contained
        herein, if Tenant has been in default under this Lease at any time prior
        to the effective date of any reduction of the Security Deposit and
        Tenant has failed to cure such default within any applicable cure
        period, then Tenant shall have no further right to reduce the amount of
        the Security Deposit (i.e. the Letter of Credit and the Additional
        Letter of Credit) as described herein. Any reduction in the Letter of
        Credit and the Additional Letter of Credit shall be accomplished by
        Tenant providing Landlord with a substitute letter of credit in the
        reduced amount.

V.      TERMINATION.

        A.  Effective as of December 31, 2004 (the "Early Termination Date") and
            subject to the agreements, representations, warranties and
            indemnities contained in this Amendment, including, without
            limitation, payment of the Termination Fee described in Section V.F
            below, the Lease is terminated and the Term of the Lease shall
            expire with the same force and effect as if the Term was, by the
            provisions thereof, fixed to expire on the Early Termination Date.

        B.  Effective as of the Early Termination Date, Tenant remises,
            releases, quitclaims and surrenders to Landlord, its successors and
            assigns, the Lease and all of the estate and rights of Tenant in and
            to the Lease and the Premises, and Tenant forever releases and
            discharges Landlord from any and all claims, demands or causes of
            action whatsoever against Landlord or its successors and assigns
            arising out of or in connection with the Premises or the Lease and
            forever releases and discharges Landlord from any obligations to be
            observed or performed by Landlord under the Lease after the Early
            Termination Date, except for those obligations of Landlord arising
            prior to the Early Termination Date and which survive or cannot be
            performed until thereafter (e.g. return of any security deposit and
            refund of any overpayment of Basic Costs, if any).

        C.  Subject to the agreements, representations, warranties and
            indemnities contained in this Amendment, Landlord agrees to accept
            the surrender of the Lease and the Premises from and after the Early
            Termination Date and, effective as of the Early Termination Date,
            forever releases and discharges Tenant from any obligations to be
            observed and performed by Tenant under the Lease after the Early
            Termination Date, provided that Tenant has satisfied, performed and
            fulfilled all of the agreements set forth in this Termination
            Agreement, and each of the representations and warranties set forth
            in Section V.E below are true and correct.

                                       5

<PAGE>

        D.  On or prior to the Early Termination Date, Tenant shall:

            1.  Fulfill all covenants and obligations of Tenant under the Lease
                applicable to the period prior to and including the Early
                Termination Date.

            2.  No later than 30 days prior to the Early Termination Date,
                completely vacate and surrender the Premises to Landlord in
                accordance with the terms of the Lease. Without limitation,
                Tenant shall leave the Premises in a broom-clean condition and
                free of all movable furniture and equipment and shall deliver
                the keys to the Premises to Landlord or Landlord's designee.

            3.  No later than 30 days prior to the Early Termination Date,
                Tenant shall permit New Tenant, free and unlimited access to the
                entire Premises for the purpose of refurbishing the Premises,
                completing tenant improvements, installing furniture, fixtures
                and equipment, cabling and telephone installations, which access
                shall not be deemed an early termination of the Lease and Tenant
                shall be responsible for all obligations under the Lease through
                and including the Early Termination Date, provided that to the
                extent not caused by Tenant, Landlord hereby releases Tenant
                from and against all damages, claims and causes of action
                arising out of or relating to any breach of the Lease caused by
                the New Tenant in connection with its occupancy of the Premises
                prior to the Early Termination Date (in the case of any such
                breach of the Lease caused by both Tenant and New Tenant, the
                release set forth above shall not constitute a release of Tenant
                for a breach of the Lease caused by Tenant).

        E.  Tenant represents and warrants that (a) Tenant is the rightful owner
            of all of the Tenant's interest in the Lease; (b) Tenant has not
            made any disposition, assignment, sublease, or conveyance of the
            Lease or Tenant's interest therein; (c) Tenant has no knowledge of
            any fact or circumstance which would give rise to any claim, demand,
            obligation, liability, action or cause of action against Landlord or
            the Landlord Related Parties arising out of or in connection with
            Tenant's occupancy of the Premises; (d) no other person or entity
            has an interest in the Lease, collateral or otherwise; and (e) there
            are no outstanding contracts for the supply of labor or material and
            no work has been done or is being done by, for, or at the direction
            of Tenant, in, to or about the Premises which has not been fully
            paid for and for which appropriate waivers of mechanics' liens have
            not been obtained. The foregoing representation and warranty shall
            be deemed to be remade by Tenant in full as of the Early Termination
            Date.

        F.  Tenant agrees to pay to Landlord or Landlord's designee, by
            cashier's or certified check or by wire transfer of immediately
            available funds to an account designated by Landlord, pursuant to
            the schedule set forth below, in consideration of the early
            termination of the Lease and the reduction of the Premises as set
            forth above, the sum of $4,348,106.96 ($2,065,559.44 of which shall
            be allocated for the First Reduction Space and Second Reduction
            Space and the balance of which shall be allocated to the Early
            Termination Date) (the "Termination Fee"), which consists of (i)
            $4,137,865.96 as consideration for the reduction of the Premises and
            accelerated term of the Lease, (ii) $205,241.00 as a brokerage
            commission for CB Richard Ellis and (iii) $5,000.00 as legal fees
            due Landlord, payable in installments as follows:

                                       6

<PAGE>

                         INSTALLMENTS OF TERMINATION FEE

<TABLE>
<CAPTION>
                                    DUE DATE                                AMOUNT DUE
                                    --------                                ----------
<S>             <C>                                                        <C>
            1.  Within two (2) business days following the date on
                which Landlord notifies Tenant that the
                contingencies contained in Section VIII(H) below,
                have been met or waived.                                   $1,780,241.00

            2.  Upon the later to occur of October 1, 2002, or the
                date that is two (2) business days following the date
                on which Landlord notifies Tenant that the
                contingencies contained in Section VIII(H) below,
                have been met or waived.                                   $  285,318.44

            3.   January 1, 2003                                           $  285,318.44

            4.   April 1, 2003                                             $  285,318.44

            5.   July 1, 2003                                              $  285,318.44

            6.   October 1, 2003                                           $  285,318.44

            7.   January 1, 2004                                           $  285,318.44

            8.   April 1, 2004                                             $  285,318.44

            9.   July 1, 2004                                              $  285,318.44

            10. October 1, 2004                                            $  285,318.44
</TABLE>

            Any and all installments of the Termination Fee due and payable
            subsequent to the execution of this Amendment, which shall not be
            deemed Rent under the terms of the Lease, shall be reduced to and
            evidenced in a promissory note in the form attached hereto as
            EXHIBIT D (the "Promissory Note") and incorporated herein, which
            Promissory Note shall be secured by the Termination Fee Letter of
            Credit set forth below, and which Promissory Note shall be executed
            and delivered by Tenant on or before the date the first installment
            of the Termination Fee is due and payable.

        G.  Termination Fee Letter of Credit. Notwithstanding anything to the
            contrary contained herein, Landlord acknowledges that in accordance
            with Section IV above, upon the effective date of this Amendment and
            to the extent Tenant has complied with the terms hereof, it will be
            holding a security deposit in the amount of $2,900,000.00 which is
            intended to secure the Rent and other financial obligations of
            Tenant other than those obligations expressly arising from the
            Termination Fee payable by Tenant as set forth above. On or before
            the date the first installment of the Termination Fee is due and
            payable, Tenant shall pay to Landlord a security deposit to further
            secure the obligations of Tenant in the timely payment of the
            Termination Fee required herein (the "Termination Fee Security
            Deposit") which shall be in the form of a letter of credit (the
            "Termination Fee Letter of Credit"), which Termination Fee Letter of
            Credit shall: (a) be in the amount of $2,282,547.52 and if no prior
            default has occurred under the Promissory Note, which amount shall
            be reduced beginning after the first 120 days thereof, on a
            quarterly calendar basis, to the principal amount then remaining due
            and owing on the Promissory Note; (b) be in substantially the form
            attached hereto as EXHIBIT C-1; (c) name Landlord, as its
            beneficiary; (d) be drawn on an FDIC insured financial institution
            reasonably satisfactory to Landlord upon which presentment may be
            made in Seattle, Washington; (e) expressly allow Landlord to draw
            upon it: (i) in the event that Tenant is in Default under the terms
            of the Promissory Note by delivering to the issuer of the
            Termination Fee Letter of Credit written notice that Landlord is
            entitled to draw thereunder pursuant to the terms of this Lease; or
            (ii) if Tenant, within 45 days prior to expiration of the
            Termination Fee Letter of Credit then held by Landlord, fails to
            provide Landlord with a replacement Termination Fee Letter of Credit
            meeting the requirements herein; (f) expressly state that it will be
            honored by the issuer without inquiry into the accuracy of any such
            notice or statement made by Landlord; (g) expressly permit multiple
            or partial draws up to the stated amount of the Termination Fee
            Letter of Credit; (h) expressly provide that it is transferable to
            any successor of Landlord at no cost to Landlord; and (i) expire no
            earlier than 45 days after the due date of the final installment due
            under the Promissory Note (cumulatively the "Termination Fee Letter
            of Credit Conditions").

        H.  Section 18(a) of the Lease shall survive the termination of the
            Lease pursuant to this Agreement.

VI.     REPRESENTATIONS. Each party represents to the other that it has full
        power and authority to execute this Amendment. Tenant represents that it
        has not made any assignment,

                                       7

<PAGE>

        sublease, transfer, conveyance of the Lease or any interest therein or
        in the Reduction Spaces other than those explicitly recited herein and
        further represents that there is not and will not hereafter be any
        claim, demand, obligation, liability, action or cause of action by any
        other party respecting, relating to or arising out of the Reduction
        Spaces, and Tenant agrees to indemnify and hold harmless Landlord and
        the Landlord Related Parties (as defined in the "Miscellaneous" Section
        below) from all liabilities, expenses, claims, demands, judgments,
        damages or costs arising from any of the same, including without
        limitation, attorneys' fees. Tenant acknowledges that Landlord will be
        relying on this Amendment in entering into leases for the Reduction
        Spaces with other parties.

VII.    OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that, effective as
        of the date of this Amendment (unless different effective date(s) is/are
        specifically referenced in this Section), the Lease shall be amended in
        the following additional respects:

        A.  NOTICE. The address for all notices to Landlord and the payment of
            Rent and any other amounts due hereunder as set forth in Article
            1(A)12 of the Lease is deleted in its entirety and the following
            substituted therefor:

            EOP-Sunset North Bellevue, L.L.C.
            c/o Equity Office Properties Trust
            3180-139th Avenue SE
            Suite 290
            Bellevue, Washington 98005
            Attention:  Property Manager

            With a copy to:

            Equity Office Properties Trust
            Two North Riverside Plaza
            Suite 2100
            Chicago, Illinois 60606
            Attention:  Regional Counsel -- Seattle Region

            Rent and other amounts due under the Lease shall be payable to
            EQUITY OFFICE PROPERTIES at the following address:

            EOP Operating Limited Partnership
            as Agent for EOP-Sunset North Bellevue, L.L.C.
            Dept. 13310, File #056403
            Los Angeles, California 90074-6403

            The address for all notices to Tenant as set forth in Article 1(A)12
            of the Lease is deleted in its entirety and the following
            substituted therefor:

            BSquare Corporation
            3150-139th Avenue SE
            Suite 500
            Bellevue, Washington 98050
            Attention:  Chief Financial Officer

        B.  DEFINITIONS. The definitions set forth in Article 1(B)(2) "Broker",
            is hereby deleted in its entirety and is of no further force or
            effect.

        C.  PREMISES-OPTIONS. The Expansion Option contained in Article 5(B) of
            the Lease, the Option to Extend contained in Article 5(C) of the
            Lease, the Right of First Offer and Other Rights contained in
            Article 5(D) of the Lease and the Termination Option contained in
            Article 5(E) of the Lease are all hereby deleted in their entirety
            and are null and void and of no further force or effect.

        D.  TENANT IMPROVEMENTS. The Refurbishment Allowance contained in
            Article 6(E) of the Lease is hereby deleted in its entirety and is
            null and void and is of no further force or effect.

        E.  LEASEHOLD IMPROVEMENTS. The second paragraph contained in Article 11
            of the Lease granting Tenant certain rights to install a standby
            generator is hereby deleted in its entirety and is null and void and
            of no further force or effect.

                                       8

<PAGE>

        F.  PARKING RIGHTS. Effective as of the First Reduction Effective Date,
            Article XV (Parking) contained in the Second Amendment is hereby
            deleted in its entirety, is null and void and of no further force or
            effect and as a result thereof, the parking rights set forth in
            Section 5(f) of the Lease are hereby reduced by 94 unassigned
            parking spaces.

        G.  EXTERIOR BUILDING SIGNAGE. Until the earlier of the Early
            Termination Date or any sooner termination of the Lease pursuant to
            the terms hereof, New Tenant shall be permitted to locate a sign
            with specifications comparable to its existing sign, and no other
            exterior sign, on the western exterior of the Building at a location
            which is half-way between the sign of Tenant and the edge of the
            Building (i.e. at a location which is approximately the same
            distance from the center of the Building as is Tenant's sign).

VIII.   MISCELLANEOUS.

        A.  This Amendment and the attached exhibits, which are hereby
            incorporated into and made a part of this Amendment, set forth the
            entire agreement between the parties with respect to the matters set
            forth herein. There have been no additional oral or written
            representations or agreements. Under no circumstances shall Tenant
            be entitled to any Rent abatement (other than as expressly provided
            in the Lease), improvement allowance, leasehold improvements, or
            other work to the Premises, or any similar economic incentives that
            may have been provided Tenant in connection with entering into the
            Lease, unless specifically set forth in this Amendment. Tenant
            agrees that neither Tenant nor its agents or any other parties
            acting on behalf of Tenant shall disclose any matters set forth in
            this Amendment or disseminate or distribute any information
            concerning the terms, details or conditions hereof to any person,
            firm or entity without obtaining the express written consent of
            Landlord. Except (i) to the extent required by any applicable
            Securities and Exchange Commission requirements, or any applicable
            Federal or State securities laws (collectively, the "Securities
            Laws"), or (ii) to the extent necessary to be disclosed to Tenant's
            accountant, banks, attorneys, advisors or others in connection with
            Tenant's business, all of whom shall be subject to and bound by the
            same confidentiality obligations contained herein, or (iii) to the
            extent necessary to be disclosed in Tenant's financial statements,
            or (iv) to the extent required by applicable law, court order or
            other legal discovery, Tenant agrees that neither Tenant nor its
            agents or any other parties acting on behalf of Tenant shall
            disclose any matters set forth in this Amendment or disseminate or
            distribute any information concerning the terms, details or
            conditions hereof to any person, firm or entity without obtaining
            the express written consent of Landlord and, if Tenant is required
            by the Securities Laws or court order or subpoena or other legal
            discovery to disclose any information contained in this Amendment,
            Tenant will give Landlord written notice of such requirement
            promptly upon Tenant becoming aware of same and in any event prior
            to making any disclosure pursuant thereto, and Tenant will cooperate
            with Landlord in Landlord's seeking (if Landlord chooses to do so) a
            protective order or other appropriate relief as Landlord may
            reasonably request. If Landlord is unable to obtain a protective
            order or other remedy with respect to such disclosure prior to the
            time Tenant is obligated to make any such disclosure, Tenant (or
            such other persons to whom such disclosure request or requirement
            applies) will disclose or otherwise furnish only the information
            legally required to be disclosed, as advised by legal counsel. In
            the event of any violation of the terms of this Section VIII.A, the
            parties acknowledge and agree that, because of the difficulty of
            ascertaining the exact amount of damages sustained by Landlord as a
            result of such violation, Landlord shall be entitled to the sum of
            $400,000.00 from Tenant as liquidated damages as Landlord's sole and
            exclusive remedy for violation of this provision, which sum shall be
            payable upon demand of Landlord. However, the foregoing shall in no
            manner limit Landlord's rights, remedies or damages as a result of
            Tenant's violation of any other term or condition of this Amendment.

        B.  Except as herein modified or amended, the provisions, conditions and
            terms of the Lease shall remain unchanged and in full force and
            effect.

        C.  In the case of any inconsistency between the provisions of the Lease
            and this Amendment, the provisions of this Amendment shall govern
            and control.

                                       9

<PAGE>

        D.  Submission of this Amendment by Landlord is not an offer to enter
            into this Amendment but rather is a solicitation for such an offer
            by Tenant. Landlord shall not be bound by this Amendment until
            Landlord has executed and delivered the same to Tenant.

        E.  The capitalized terms used in this Amendment 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
            Amendment.

        F.  Tenant hereby represents to Landlord that Tenant has dealt with no
            broker in connection with this Amendment other than Ron Leibsohn of
            CB Richard Ellis. Tenant agrees to indemnify and hold Landlord, its
            members, principals, beneficiaries, partners, officers, directors,
            employees, mortgagee(s) and agents, and the respective principals
            and members of any such agents (collectively, the "Landlord Related
            Parties") harmless from all claims of any brokers claiming to have
            represented Tenant in connection with this Amendment. Landlord
            hereby represents to Tenant that Landlord has dealt with no broker
            in connection with this Amendment. Landlord agrees to indemnify and
            hold Tenant, its members, principals, beneficiaries, partners,
            officers, directors, employees, and agents, and the respective
            principals and members of any such agents (collectively, the "Tenant
            Related Parties") harmless from all claims of any brokers claiming
            to have represented Landlord in connection with this Amendment.

        G.  Each signatory of this Amendment represents hereby that he or she
            has the authority to execute and deliver the same on behalf of the
            party hereto for which such signatory is acting.

        H.  CONTINGENCIES. This Amendment is contingent upon the following:

            1.  Expedia Lease Agreement. Expedia Inc., a Washington corporation
                ("New Tenant" or "Expedia"), entering into a Lease Agreement
                with Landlord to occupy space in the Building which includes the
                Original Premises, commencing on the dates which are consistent
                with the dates of the First and Second Reduction Effective
                Dates, respectively and the Early Termination Date (the "Expedia
                Lease"). If the Expedia Lease is not mutually executed and
                delivered on or before September 13, 2002, then, at Landlord's
                option, to be exercised by written notice delivered on or before
                September 27, 2002, this Amendment shall be of no further force
                or effect.

            2.  Tenant Furniture Transfer. Expedia entering into an agreement
                with Tenant pursuant to which Tenant transfers ownership of the
                Furniture. If Tenant and Expedia do not enter into such an
                agreement on or before October 1, 2002, then, at Landlord's
                option, to be exercised by written notice delivered on or before
                October 4, 2002, this Amendment shall be of no further force or
                effect.

            3.  Connectivity. Expedia obtaining fiber network telecommunications
                and fiber data connectivity with Expedia's space in the building
                ("Building One") known as Sunset Corporate Campus, Building One
                ("Connectivity"). If Expedia is not satisfied that Connectivity
                will be established on or before October 22, 2002, then, at
                Landlord's option, to be exercised by written notice delivered
                on or before October 4, 2002, this Amendment shall be of no
                further force or effect.

            4.  If this Amendment terminates pursuant to Section VIII.H.1, 2, or
                3, above, and if the New Tenant has modified Floors 1 and or 2
                prior to termination of this Amendment, Landlord shall, if
                requested by Tenant within 30 days of the date of termination of
                this Amendment, restore Floors 1 and or 2 to substantially the
                same condition prior to the work by New Tenant.

                                       10

<PAGE>

        IN WITNESS WHEREOF, Landlord and Tenant have duly executed this
Amendment as of the day and year first above written.

                                  LANDLORD:

                                  EOP-SUNSET NORTH BELLEVUE, L.L.C., A
                                  WASHINGTON LIMITED LIABILITY COMPANY

                                  By: EOP-Sunset North, L.L.C., a Delaware
                                      limited liability company, its managing
                                      member

                                      By: EOP Operating Limited Partnership, a
                                          Delaware limited partnership, its sole
                                          member

                                          By: Equity Office Properties Trust, a
                                              Maryland real estate investment
                                              trust, its general partner

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

                                               Name: M. Patrick Callahan

                                               Title Senior Vice President--
                                                     Seattle Region

                                  TENANT:

                                  BSQUARE CORPORATION, A WASHINGTON CORPORATION

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

                                  Name:
                                       -----------------------------------------

                                  Title:
                                        ----------------------------------------

                                       11

<PAGE>

                            LANDLORD ACKNOWLEDGMENTS

STATE OF ____________)
COUNTY OF __________)  SS:

        I, THE UNDERSIGNED, A NOTARY PUBLIC, IN AND FOR THE COUNTY AND STATE
AFORESAID, DO HEREBY CERTIFY THAT M PATRICK CALLAHAN, PERSONALLY KNOWN TO ME TO
BE THE SENIOR VICE PRESIDENT OF EQUITY OFFICE PROPERTIES TRUST, A MARYLAND REAL
ESTATE INVESTMENT TRUST, AND PERSONALLY KNOWN TO ME TO BE THE SAME PERSON WHOSE
NAME IS SUBSCRIBED TO THE FOREGOING INSTRUMENT, APPEARED BEFORE ME THIS DAY IN
PERSON AND ACKNOWLEDGED THAT AS SUCH OFFICER OF SAID ENTITY BEING AUTHORIZED SO
TO DO, (s)HE EXECUTED THE FOREGOING INSTRUMENT ON BEHALF OF SAID ENTITY, BY
SUBSCRIBING THE NAME OF SUCH ENTITY BY HIMSELF/HERSELF AS SUCH OFFICER, AS A
FREE AND VOLUNTARY ACT, AND AS THE FREE AND VOLUNTARY ACT AND DEED OF SAID
ENTITY, FOR THE USES AND PURPOSES THEREIN SET FORTH.

        GIVEN UNDER MY HAND AND OFFICIAL SEAL THIS ___ DAY OF ___________, 20__.

                                           _____________________________________
                                                      NOTARY PUBLIC

                                           _____________________________________
                                                       PRINTED NAME

MY COMMISSION EXPIRES: __________

                             TENANT ACKNOWLEDGMENTS

STATE OF ____________)
COUNTY OF __________)  SS:

        ON THIS THE ___ DAY OF ____________, 2002, BEFORE ME A NOTARY PUBLIC
DULY AUTHORIZED IN AND FOR THE SAID COUNTY IN THE STATE AFORESAID TO TAKE
ACKNOWLEDGMENTS PERSONALLY APPEARED __________________________ KNOWN TO ME TO BE
____________ PRESIDENT OF BSQUARE CORPORATION, A WASHINGTON CORPORATION, ONE OF
THE PARTIES DESCRIBED IN THE FOREGOING INSTRUMENT, AND ACKNOWLEDGED THAT AS SUCH
OFFICER, BEING AUTHORIZED SO TO DO, (s)HE EXECUTED THE FOREGOING INSTRUMENT ON
BEHALF OF SAID CORPORATION BY SUBSCRIBING THE NAME OF SUCH CORPORATION BY
HIMSELF/HERSELF AS SUCH OFFICER AND CAUSED THE CORPORATE SEAL OF SAID
CORPORATION TO BE AFFIXED THERETO, AS A FREE AND VOLUNTARY ACT, AND AS THE FREE
AND VOLUNTARY ACT OF SAID CORPORATION, FOR THE USES AND PURPOSES THEREIN SET
FORTH.

        IN WITNESS WHEREOF, I HEREUNTO SET MY HAND AND OFFICIAL SEAL.

                                           _____________________________________
                                                      NOTARY PUBLIC

                                           _____________________________________
                                                      PRINTED NAME

MY COMMISSION EXPIRES: __________

                                       12

<PAGE>

                                    EXHIBIT B

                            LIST OF PERSONAL PROPERTY

1.      All supplemental HVAC equipment and accessories installed by Tenant in
        or above Rooms 2253 and 2255, after New Tenant's initial occupancy of
        such rooms; Tenant may relocate such equipment and accessories to an
        alternate location(s) on the 3rd, 4th or 5th floor of the Building
        provided that (A) Tenant restore to Landlord's reasonable satisfaction
        any damage to Rooms 2253 and/or 2255 caused by such removal or
        restoration and (B) such equipment and accessories will, at the
        expiration or termination of the Lease as provided for in the Amendment
        attached hereto, become the property of Landlord.

2.      All free-standing shelving located in Room 1070 (Tenant's current
        shipping room). In lieu of Tenant's removal of the existing built-in
        counter top (the "Countertop") in Room 1070, at Tenant's request,
        Landlord's agrees to replace, using comparable materials, the Countertop
        in Room 1070 which shall be of approximately the same size and dimension
        and located in Tenant's Premises, as designated by Tenant.

3.      Security cameras located in:

        1st Floor South Stairwell
        1st Floor North Stairwell
        1st Floor East
        1st Floor Shipping & Receiving/Loading Dock Room
        1st Floor Lobby 1
        1st Floor Lobby 2
        1st Floor Center Stairwell
        1st Floor Loading (Outside)
        2nd Floor Lobby 1
        2nd Floor Lobby 2

                                       1
<PAGE>

                                    EXHIBIT C

                            FORM OF LETTER OF CREDIT

                                        Irrevocable Standby
                                        Letter of Credit
                                        No. ______________________
                                        Issuance Date:_____________
                                        Expiration Date:____________
                                        Applicant:__________________

Beneficiary

EOP-Sunset North Bellevue, L.L.C.
3180-139th Avenue SE
Suite 290
Bellevue, Washington 98005
Attention: Property Manager

Ladies/Gentlemen:

        We hereby establish our Irrevocable Standby Letter of Credit in your
favor for the account of the above referenced Applicant in the amount of
____________________ U.S. Dollars ($____________________) available for payment
at sight by your draft drawn on us when accompanied by the following documents:

1.      An original copy of this Irrevocable Standby Letter of Credit.

2.      Beneficiary's dated statement purportedly signed by an authorized
        signatory or agent reading: "This draw in the amount of
        ______________________ U.S. Dollars ($____________) under your
        Irrevocable Standby Letter of Credit No. ____________________ represents
        funds due and owing to us pursuant to the terms of that certain lease by
        and between ______________________, as landlord, and _____________, as
        tenant, and/or any amendment to the lease or any other agreement between
        such parties related to the lease."

        It is a condition of this Irrevocable Standby Letter of Credit that it
will be considered automatically renewed for a one year period upon the
expiration date set forth above and upon each anniversary of such date, unless
at least 60 days prior to such expiration date or applicable anniversary
thereof, we notify you in writing, by certified mail return receipt requested or
by recognized overnight courier service, that we elect not to so renew this
Irrevocable Standby Letter of Credit. A copy of any such notice shall also be
sent, in the same manner, to: Equity Office Properties Trust, 2 North Riverside
Plaza, Suite 2100, Chicago, Illinois 60606, Attention: Treasury Department. In
addition to the foregoing, we understand and agree that you shall be entitled to
draw upon this Irrevocable Standby Letter of Credit in accordance with 1 and 2
above in the event that we elect not to renew this Irrevocable Standby Letter of
Credit and, in addition, you provide us with a dated statement purportedly
signed by an authorized signatory or agent of Beneficiary stating that the
Applicant has failed to provide you with an acceptable substitute irrevocable
standby letter of credit in accordance with the terms of the above referenced
lease. We further acknowledge and agree that: (a) upon receipt of the
documentation required herein, we will honor your draws against this Irrevocable
Standby Letter of Credit without inquiry into the accuracy of Beneficiary's
signed statement and regardless of whether Applicant disputes the content of
such statement; (b) this Irrevocable Standby Letter of Credit shall permit
partial draws and, in the event you elect to draw upon less than the full stated
amount hereof, the stated amount of this Irrevocable Standby Letter of Credit
shall be automatically reduced by the amount of such partial draw; and (c) you
shall be entitled to transfer your interest in this Irrevocable Standby Letter
of Credit from time to time and more than one time without our approval and
without charge. In the event of a transfer, we reserve the right to require
reasonable evidence of such transfer as a condition to any draw hereunder.

        This Irrevocable Standby Letter of Credit is subject to the Uniform
Customs and Practice for Documentary Credits (1993 revision) ICC Publication No.
500.

        We hereby engage with you to honor drafts and documents drawn under and
in compliance with the terms of this Irrevocable Standby Letter of Credit.

        All communications to us with respect to this Irrevocable Standby Letter
of Credit must

                                       2

<PAGE>

be addressed to our office located at ______________________________________ to
the attention of __________________________________.

                                              Very truly yours,

                                              __________________________________

                                                            [name]
                                              __________________________________

                                                            [title}
                                              __________________________________

                                       3

<PAGE>

                                   EXHIBIT C-1

                            FORM OF LETTER OF CREDIT

                                                Irrevocable Standby
                                                Letter of Credit
                                                No. ______________________
                                                Issuance Date:_____________
                                                Expiration Date:____________
                                                Applicant:__________________

Beneficiary

EOP-Sunset North Bellevue, L.L.C.
3180-139th Avenue SE
Suite 290
Bellevue, Washington 98005
Attention: Property Manager

Ladies/Gentlemen:

        We hereby establish our Irrevocable Standby Letter of Credit in your
favor for the account of the above referenced Applicant in the amount of
____________________ U.S. Dollars ($____________________) available for payment
at sight by your draft drawn on us when accompanied by the following documents:

1.      An original copy of this Irrevocable Standby Letter of Credit.

2.      Beneficiary's dated statement purportedly signed by an authorized
        signatory or agent reading: "This draw in the amount of
        ______________________ U.S. Dollars ($____________) under your
        Irrevocable Standby Letter of Credit No. ____________________ represents
        funds due and owing to us pursuant to the terms of that certain
        Promissory Note executed by BSQUARE CORPORATION, as Maker, and payable
        to EOP-SUNSET NORTH BELLEVUE, L.L.C., as Payee, and/or any amendment,
        modification or substitution of such Promissory Note."

        It is a condition of this Irrevocable Standby Letter of Credit that it
will be considered automatically renewed for a one year period upon the
expiration date set forth above and upon each anniversary of such date, unless
at least 60 days prior to such expiration date or applicable anniversary
thereof, we notify you in writing, by certified mail return receipt requested or
by recognized overnight courier service, that we elect not to so renew this
Irrevocable Standby Letter of Credit. A copy of any such notice shall also be
sent, in the same manner, to: Equity Office Properties Trust, 2 North Riverside
Plaza, Suite 2100, Chicago, Illinois 60606, Attention: Treasury Department. In
addition to the foregoing, we understand and agree that you shall be entitled to
draw upon this Irrevocable Standby Letter of Credit in accordance with 1 and 2
above in the event that we elect not to renew this Irrevocable Standby Letter of
Credit and, in addition, you provide us with a dated statement purportedly
signed by an authorized signatory or agent of Beneficiary stating that the
Applicant has failed to provide you with an acceptable substitute irrevocable
standby letter of credit in accordance with the terms of the above referenced
lease. We further acknowledge and agree that: (a) upon receipt of the
documentation required herein, we will honor your draws against this Irrevocable
Standby Letter of Credit without inquiry into the accuracy of Beneficiary's
signed statement and regardless of whether Applicant disputes the content of
such statement; (b) this Irrevocable Standby Letter of Credit shall permit
partial draws and, in the event you elect to draw upon less than the full stated
amount hereof, the stated amount of this Irrevocable Standby Letter of Credit
shall be automatically reduced by the amount of such partial draw; and (c) you
shall be entitled to transfer your interest in this Irrevocable Standby Letter
of Credit from time to time and more than one time without our approval and
without charge. In the event of a transfer, we reserve the right to require
reasonable evidence of such transfer as a condition to any draw hereunder.

        This Irrevocable Standby Letter of Credit is subject to the Uniform
Customs and Practice for Documentary Credits (1993 revision) ICC Publication No.
500.

        We hereby engage with you to honor drafts and documents drawn under and
in compliance with the terms of this Irrevocable Standby Letter of Credit.

        All communications to us with respect to this Irrevocable Standby Letter
of Credit must

                                       4

<PAGE>

be addressed to our office located at ________________________________________
to the attention of __________________________________.

                                              __________________________________

                                                            [name]
                                              __________________________________

                                                            [title}
                                              __________________________________

                                       5

<PAGE>

                                    EXHIBIT D

                                 PROMISSORY NOTE

                                      Holder's Note
                                      Straight Installment
                                      Fixed Rate
                                      Secured

$2,567,865.96                         Seattle, Washington
                                      ________________, 2002

FOR VALUE RECEIVED, the undersigned, BSQUARE CORPORATION, A WASHINGTON
CORPORATION (the "Maker"), promises to pay to the order of EOP-SUNSET NORTH
BELLEVUE, L.L.C., A WASHINGTON LIMITED LIABILITY COMPANY (the "Payee"), the
principal sum of TWO MILLION FIVE HUNDRED SIXTY SEVEN THOUSAND EIGHT HUNDRED
SIXTY FIVE AND 44/100 DOLLARS ($2,567,865.96), together with interest thereon,
all as hereinafter provided and upon the following agreements, terms and
conditions:

1.      Payment. Maker shall pay principal in substantially equal consecutive
        quarterly installments as follows:

        NUMBER OF INSTALLMENTS: NINE (9)

        AMOUNT OF EACH INSTALLMENT: $285, 318.44

        FIRST INSTALLMENT PAYABLE ON OCTOBER 4, 2002

        and subsequent quarterly installments on the like day of each successive
        quarter beginning on January 1, 2003 and each subsequent April, July,
        October and January until this Note shall be paid in full; provided,
        however, that the last such installment shall be in an amount necessary
        to repay in full the unpaid principal amount of this Note and all unpaid
        interest accrued thereon, if any. Each payment shall be applied first to
        interest accrued to the installment payment date, if any, and then to
        principal. All payments shall be payable in lawful money of the United
        States of America which shall be the legal tender for public and private
        debts at the time of payment. All payments shall be made to the holder
        hereof at ______________________________, or at such other place as the
        holder may specify in writing from time to time.

2.      Interest. This Note shall bear no interest unless Maker is in Default,
        as defined below. In the event of any default as hereinafter defined,
        all sums then and thereafter owing hereon shall bear interest at a rate
        (the "Default Rate") per annum, which shall be Twelve percent (12%). On
        the first day of each quarter and on the like day of each quarter
        thereafter, all interest then accrued but unpaid hereon shall be
        computed and determined and shall thereupon be added to the principal
        sum hereunder and thereafter bear interest at the applicable rate set
        forth above.

3.      Prepayment. Maker may prepay any sums now or hereafter owing hereon at
        any time. Notwithstanding any prepayment, the Maker shall continue to
        make all succeeding installment or other payments as they become due,
        and the prepayment shall be applied upon installments in the inverse
        order of their due date.

4.      Late Payment Charge. If any installment of principal or interest shall
        not be paid when due and such failure continues for five (5) business
        days following written notice from Payee or the current holder of this
        Note, the Maker agrees to pay a late charge equal to Five percent (5 %)
        of the delinquent payments. This is in addition to and not in lieu of
        any other rights or remedies the holder of this Note may have by virtue
        of any breach or default.

5.      Security Instrument. This Note and the sums evidenced hereby are secured
        by an Irrevocable Letter of Credit dated _____________, 2002 (the
        "Security Instrument"), executed and delivered by, or caused to be
        executed and delivered by, the Maker hereof to the original holder of
        this Note. The Maker agrees to perform and comply with, or to cause to
        be performed and complied with, all of the agreements, terms, and
        conditions of the Security Instrument.

6.      Default; Attorneys' Fees, and Other Costs and Expenses. In the event of
        any default, at the option of the holder of this Note, all sums owing
        and to become owing hereon shall

                                       6

<PAGE>

        become immediately due and payable and shall bear interest thereafter at
        the Default Rate per annum. A "Default" shall mean any failure to pay
        any sum then owing hereon when due, and such failure continues for a
        period of five (5) business days following written notice from Payee or
        the current holder of this Note, or the failure to pay any other sum
        which may become due and payable pursuant to the Security Instrument, or
        any breach of warranty in or the failure to perform or comply with any
        of the agreements, terms or conditions of the Security Instrument. The
        Maker agrees to pay all costs and expenses which the holder of this Note
        may incur by reason of any default and to a determination of any rights
        or remedies of the holder under this Note or under the Security
        Instrument, and all reasonable attorneys' fees relating thereto, whether
        or not any actions or proceedings are commenced, and including, without
        limitation, all those relating to any actions or proceedings which the
        holder of this Note may institute or in which the holder may appear or
        participate and in any reviews thereof and appeals therefrom, and all
        such sums shall be secured by the Security Instrument. Any judgment
        recovered by the holder hereon shall bear interest at the Default Rate
        per annum. Maker agrees that the venue of any action hereon may be laid
        in King County, state of Washington, at the option of the holder of this
        Note, and Maker agrees to submit to the personal jurisdiction of the
        courts of the state of Washington in any actions or proceedings arising
        out of, or in connection with, or relating to, this Note.

7.      Liability. All persons signing this Note as Maker and, in the case of a
        partnership Maker, all partners thereof, agree that they have actual
        authority to execute this Note in their representative capacity as an
        authorized representative of Maker and they waive demand, presentment
        for payment, protest and notice of protest and nonpayment. Each such
        person agrees that any modification or extension of the terms of payment
        made by the holder of this Note, or forbearance in enforcing any of the
        provisions of this Note or the Security Instrument, with or without
        notice, at the request of any person liable hereon or owning an interest
        in any property, real or personal, described in the Security Instrument,
        or a release of any party liable for this obligation, or a release of
        property, real or personal, or any part thereof from the lien of the
        Security Instrument, shall not diminish or impair his or their liability
        for the payment hereof.

8.      Maximum Interest. Notwithstanding any other provisions of this Note or
        of the Security Instrument, interest, fees, and charges payable by
        reason of the indebtedness evidenced hereby shall not exceed the
        maximum, if any, permitted by any governing law. Maker hereby represents
        and warrants that the transaction giving rise to the indebtedness
        evidenced by this Note is primarily for agricultural, commercial,
        investment or business purposes and is not primarily for personal,
        family or household purposes.

9.      Applicable Law. This Note shall be construed according to the laws of
        the state of Washington.

10.     Oral Agreements Not Enforceable. ORAL AGREEMENTS OR ORAL COMMITMENTS TO
        LOAN MONEY, EXTEND CREDIT, OR TO FORBEAR FROM ENFORCING REPAYMENT OF A
        DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.

                                 BSQUARE CORPORATION, A WASHINGTON CORPORATION
                                 By: ___________________________________________

                                 Name: _________________________________________

                                 Title: ________________________________________

                                 Date: _________________________________________

                                       7

<PAGE>

                                    EXHIBIT E

                                    FURNITURE

                                       1<PAGE>
                                                                    EXHIBIT 10.1

                             STOCK OPTION AGREEMENT

THIS STOCK OPTION AGREEMENT (this "Agreement") is entered into effective as of
the effective date (the "Grant Date") set forth in the Notice of Grant of Stock
Options and Option Agreement attached hereto (the "Notice of Grant"), by
RealNetworks, Inc., a Washington corporation (the "Company"), and you (the
"Holder").

                                         RECITALS

A.  The Company has adopted the RealNetworks, Inc. 1996 Stock Option Plan, as
    amended and restated (the "Plan"), a copy of which has been provided to the
    Holder (capitalized terms that are used but not defined in this Agreement
    will have the meanings given those terms in the Plan).

B.  The Holder is an employee of the Company or one of its Affiliates (as
    defined in the Plan), and has been designated by the Administrative
    Committee to receive a stock option under the Plan.

NOW, THEREFORE, the Company and the Holder covenant and agree as follows:

1.  GRANT OF THE OPTION. Subject to the terms of this Agreement and the Plan,
    the Company hereby grants to the Holder a stock option (the "Option") to
    acquire from the Company the number of shares of the Common Stock, par value
    $.001, of the Company (the "Common Stock") set forth in the Notice of Grant,
    at the price set forth in the Notice of Grant (the "Option Price"). The
    Option is not intended to qualify as an "incentive stock option", as that
    term is defined in Section 422 of the Internal Revenue Code of 1986, as
    amended.

2.  TERM OF THE OPTION. Unless earlier terminated in accordance with the
    provisions of the Plan, the Option will terminate on the earliest to occur
    of (a) the expiration of Twenty (20) years from the Grant Date; (b) the
    expiration of ninety (90) days following termination of the Holder's
    employment with the Company for any reason other than death, Disability or
    Cause (as defined in Section 7.2(b) of the Plan); (c) the expiration of One
    (1) year following termination of the Holder's employment with the Company
    on account of death or Disability; and (d) the date of termination of the
    Holder's employment with the Company for Cause (as defined in Section 7.2(b)
    of the Plan); provided, however, that, in the case of termination of the
    Holder's employment with the Company for any reason other than death,
    Disability or Cause (as defined in Section 7.2(b) of the Plan), if the
    Holder dies after such termination but prior to termination of the Option as
    set forth in this Section 2 above, the Option will not terminate as set
    forth in this Section 2 above, but rather shall terminate on the earlier to
    occur of the expiration of Twenty (20) years from the Grant Date or the
    expiration of One (1) year following the Holder's death.

3.  VESTING. The vesting schedule applicable to the Option shall be as set forth
    in the Notice of Grant, subject to sub-paragraphs (a) and (b) below. On any
    scheduled vesting date, vesting actually will occur only if you remain an
    employee of the Company or any of its Affiliates (as defined in the Plan)
    through the vesting date.

        (a)    Notwithstanding anything in this Agreement to the contrary, if
               the Company terminates Holder's employment for any reason other
               than for Cause (as defined in Section 7.2(b) of the Plan) and
               Holder executes and delivers a Settlement Agreement and Release
               ("Release") satisfactory to the Company on or before the
               Effective Date (as defined in the Release), the vesting schedule
               set forth below shall apply instead of the vesting schedule
               described in the Notice of Grant.

               VESTING UPON EXECUTION OF RELEASE. 1/60 of the shares subject to
               the Option shall vest upon the completion of one month of
               employment following the date on which the

                                      -1-
<PAGE>

               vesting of the Option commences, and an additional 1/60 of the
               shares subject to the Option shall vest upon the completion of
               each successive month of employment thereafter, up to the
               Holder's date of termination (as defined in the Release).

        (b)    If the Holder's employment with the Company terminates for any
               reason other than the Holder's death, the Option will not vest
               further following such termination. If the Holder's employment
               with the Company terminates due to the Holder's death, the Option
               will fully vest on the date of termination of employment. In
               either case, to the extent the Option is vested, it shall be
               exercisable only prior to its termination as provided in Section
               2.

4.  OTHER LIMITATIONS OF THE OPTION. The Option is subject to all of the
    provisions of the Plan, including but not limited to Section 4.2 (which
    permits adjustments to the Option upon the occurrence of certain corporate
    events such as stock dividends, extraordinary cash dividends,
    reclassifications, recapitalizations, reorganizations, split-ups, spin-offs,
    combinations, exchanges of shares, and warrants or rights offerings) and
    Section 7.1 (which applies in the event of an Approved Transaction or
    Control Purchase).

5.  EXERCISE OF THE OPTION. To exercise the Option, the Holder must do the
    following:

        (a) deliver to the Company a written notice, in the form attached to
            this Agreement as Exhibit A, specifying the number of shares of
            Common Stock for which the Option is being exercised;

        (b) tender payment of the aggregate Option Price for the shares for
            which the Option is being exercised, which payment may be made (i)
            in cash or by check; or (ii) by such other means as the
            Administrative Committee, in its sole discretion, shall permit at
            the time of exercise;

        (c) pay, or make arrangements satisfactory to the Administrative
            Committee for payment to the Company of all federal, state and local
            taxes, if any, required to be withheld by the Company in connections
            with the exercise of the Option; and

        (d) execute and deliver to the Company the documents required by the
            Plan and any other documents required from time to time by the
            Administrative Committee in order to promote compliance with
            applicable laws, rules and regulations.

6.  DELIVERY OF SHARE CERTIFICATE. As soon as practicable after the Option has
    been duly exercised, the Company will deliver to the Holder a certificate
    for the shares of Common Stock for which the Option was exercised. Unless
    the Option has expired or been exercised in full, the Company and the Holder
    agree to execute a new Stock Option Agreement, covering the remaining shares
    of Common Stock that may be acquired upon exercise of the Option, which will
    be identical to this Agreement except as to the number of shares of Common
    Stock subject thereto. In lieu of replacing this Agreement in such manner,
    the Company may affix to this Agreement an appropriate notation indicating
    the number of shares for which the Option was exercised and return this
    Agreement to the Holder.

7.  NONTRANSFERABILITY. The Option is not transferable other than by will or the
    laws of descent and distribution, and the Option may be exercised during the
    lifetime of the Holder only by the Holder or the Holder's court appointed
    legal representative.

8.  WARRANTIES AND REPRESENTATIONS OF THE HOLDER. By executing this Agreement,
    the Holder accepts the Option, acknowledges receipt of a copy of the Plan
    and the Prospectus, and agrees to comply with all of the provisions of this
    Agreement.

9.  RIGHTS OF THE SHAREHOLDER. The Holder will have no rights as a shareholder
    of the Company on account of the Option or on account of shares of Common
    Stock which will be acquired upon exercise of the Option (but with respect
    to which no certificates have been issued).

                                      -2-
<PAGE>

10. TAX WITHHOLDING. The Holder agrees to pay, or to make arrangements
    satisfactory to the Administrative Committee for payment to the Company of,
    all federal, state and local income and employment taxes, if any, required
    to be withheld by the Company in connection with the exercise of the Option
    or any sale, transfer or other disposition of any shares of Common Stock
    acquired upon exercise of the Option. If the Holder fails to do so, then the
    Holder hereby authorizes the Company to deduct all or any portion of such
    taxes from any payment of any kind otherwise due to the Holder.

11. POLICY ON AVOIDANCE OF INSIDER TRADING. The Holder acknowledges that he/she
    has received and read the RealNetworks Policy on Avoidance of Insider
    Trading, and, if applicable, the Addendum to the Policy on Avoidance of
    Insider Trading, and the Holder agrees to comply with the Policy's terms,
    together with the terms of the Addendum, if applicable.

12. FURTHER ASSURANCES. The Holder agrees from time to time to execute such
    additional documents as the Company may reasonably require to effectuate the
    purposes of the Plan and this Agreement.

13. BINDING EFFECT. This Agreement shall be binding upon the Holder and the
    Holder's heirs, successors and assigns.

14. ENTIRE AGREEMENT; MODIFICATIONS. This Agreement and the exhibits hereto,
    together with the Plan and agreements referenced in this Agreement and/or
    the Plan, constitutes the entire agreement and understanding between the
    Company and the Holder regarding the subject matter hereof. Except as
    otherwise provided in the Plan, no modification of the Option or this
    Agreement, or waiver of any provision of this Agreement or the Plan, shall
    be valid unless in writing and duly executed by the Company and the Holder.
    The failure of any party to enforce any of that party's rights against the
    other party for breach of any of the terms of this Agreement shall not be
    construed as a waiver of such rights as to any continued or subsequent
    breach.

15. COST OF LITIGATION. In any action at law or in equity to enforce any of the
    provisions or rights under this Agreement, the unsuccessful party to such
    litigation, as determined by the court in a final judgement or decree, shall
    pay the successful party or parties all costs, expenses and reasonable
    attorneys' fees incurred by the successful party or parties (including
    without limitation costs, expenses and fees in any appellate proceedings),
    and if the successful party recovers judgment in any such action or
    proceeding, such costs, expenses and attorney's fees shall be included as
    part of the judgment.

16. GOVERNING LAW. This Agreement shall be governed by the laws of the State of
    Washington.

17. SEVERABILITY. If any provision of this Agreement shall be judicially
    determined to be invalid, illegal or unenforceable, the validity, legality
    and enforceability of the remaining provisions shall not in any way be
    affected or impaired thereby.

                                      -3-
<PAGE>

                                                                       EXHIBIT A

                           FORM OF EXERCISE OF OPTION

To: RealNetworks, Inc.
    2601 Elliott Avenue, #1000
    Seattle, WA 98121

The undersigned holds Option Number NQ-___ (the "Option"), represented by a
Stock Option Agreement dated effective as of ____________ (the "Agreement"),
granted to the undersigned pursuant to the RealNetworks, Inc. 1996 Stock Option
Plan, as Amended and Restated (the "Plan"). The undersigned hereby exercises the
Option and elects to purchase ______________ shares (the "Shares") of Common
Stock of RealNetworks, Inc. (the "Company") pursuant to the Option. This notice
is accompanied by full payment of the Option Price of $______ per share for the
Shares in cash or by check or in another manner permitted by Section 5(c) of the
Agreement. The undersigned has also paid, or made arrangements satisfactory to
the Administrative Committee administering the Plan for payment of, all federal,
state and local taxes, if any, required to be withheld by the Company in
connection with the exercise of the Option.

Date:
      -------------------

                                            SIGNATURE OF HOLDER

                                            ----------------------------------

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