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<PAGE>

================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                ----------------
                                   Form 10-K
                                ----------------


   (Mark One)

       [X]        ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934

                     For the fiscal year ended July 2, 2000

                                       OR

       [_]        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934

                       For the transition period from        to          .

                        Commission file number 333-71921

                             Extreme Networks, Inc.
             (Exact name of Registrant as specified in its charter)



<TABLE>
<CAPTION>
<S>                                                 <C>
           Delaware                                              77-0430270
(State or other jurisdiction of                     (I.R.S. Employer Identification No.)
 incorporation or organization)


          3585 Monroe Street                                       95051
         Santa Clara, California                                 (Zip Code)
(Address of principal executive offices)
</TABLE>


      Registrant's telephone number, including area code: (408) 579-2800

       Securities registered pursuant to Section 12(b) of the Act: None

          Securities registered pursuant to Section 12(g) of the Act:
                         Common stock, $.001 par value

     Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [_]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference to Part III of this Form 10-K or any
amendment to this Form 10-K. [_]

     The aggregate market value of voting stock held by non-affiliates of the
Registrant was approximately $9,892,125,000 as of September 15, 2000, based upon
the closing price on the Nasdaq National Market reported for such date. This
calculation does not reflect a determination that certain persons are affiliates
of the Registrant for any other purpose.

     109,912,500 shares of the Registrant's Common stock, $.001 par value, were
outstanding September 15, 2000.

                       DOCUMENTS INCORPORATED BY REFERENCE

    Items 10 (as to directors), 11,12 and 13 of Part III incorporate by
reference information from the Registrant's Proxy Statement to be filed with the
Securities and Exchange Commission in connection with the solicitation of
proxies for the Registrant's 2000 Annual Meeting of Stockholders.

================================================================================
<PAGE>

                            EXTREME NETWORKS, INC.
                                   FORM 10-K
                                     INDEX


<TABLE>
<CAPTION>
                                                                                           Page
                                                                                           ----
<S>                                                                                        <C>
                                     PART I

Item 1. Business                                                                             3

Item 2. Properties                                                                          14

Item 3. Legal Proceedings                                                                   14

Item 4. Submission of Matters to a Vote of Security holders                                 14

                                     PART II

Item 5.  Market For Registrant's Common Equity and Related Stockholder
         Matters                                                                            16

Item 6.  Selected Consolidated Financial Data                                               16

Item 7.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations                                                          17

Item7A.  Quantitative and Qualitative  Disclosures About Market Risk                        30

Item 8.  Financial Statements and Supplementary Data                                        32

Item 9.  Changes in and Disagreements With Accountants on Accounting and
         Financial Disclosure                                                               49

                                    PART III

Item 10. Directors and Executive Officers of the Registrant                                 49

Item 11. Executive Compensation                                                             49

Item 12. Security Ownership of Certain Beneficial Owners and Management                     50

Item 13. Certain Relationships and Related Transactions                                     50

                                     PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K                    50

SIGNATURES                                                                                  53
</TABLE>
<PAGE>

                                    PART I

Item 1. Business.

    When used in this Report, the words "may," "should," "believes," "expects,"
"anticipates," "estimates" and similar expressions are intended to identify
forward-looking statements. Such statements, which include statements concerning
the availability and functionality of products under development, product mix,
pricing trends, the mix of export sales, sales to significant customers and the
availability and cost of products from the Company's suppliers, are subject to
risks and uncertainties, including those set forth under "Management's
Discussion and Analysis of Financial Condition and Results of Operations --
Factors That May Affect Our Results." Our actual results could differ materially
from those projected in these forward-looking statements which could have a
material adverse effect on our business, operating results and financial
condition. These forward-looking statements speak only as of the date hereof and
there may be events in the future that we are not able to predict accurately or
over which we have no control.

Overview

     Extreme Networks, Inc. ("Extreme" or "the Company") is a leading provider
of broadband ethernet networking solutions for the Internet economy. The key
advantages of our ethernet switching solutions are increased performance, the
ability to easily grow, or "scale," in size as customer needs change, flexible
allocation of network resources, ease of use and lower cost of ownership. These
advantages are obtained through the use of custom semiconductors, known as
ASICs, in our products and through designs that are common and uniform across
our product line. The routing of network traffic, a function referred to as
Layer 3 switching, is done primarily with ASICs in our products, and
consequently, is faster than the software implementations used in many competing
products. Traditional Layer 3 products rely primarily on software which can slow
traffic speeds below those which could otherwise be achieved and result in
message packets being lost when network traffic is high. Our products
incorporate an ASIC-based, wire-speed architecture and are designed to avoid the
loss of message packets in the switch, or "non-blocking." As a result, our
products are less expensive than software-based routers, yet offer improved
performance throughout the network.

Industry Background

     Businesses and other organizations have become increasingly dependent on
the internet as their central communications infrastructure to provide
connectivity for internal and external communications. New mission-critical
computing applications, such as enterprise resource planning, large enterprise
databases and sophisticated on-line connections with vendors, as well as the
increased use of traditional applications, such as e-mail, require significant
information technology resources. The emergence of the desktop browser as a user
interface has enabled bandwidth-intensive applications that contain voice, video
and graphics to be used extensively through intranets and externally through
extranets. These new applications, combined with the growth in business-to-
business e-commerce and other on-line transactions, mobile communications and
application service providers for example, are further burdening the network
infrastructure.

Today's Networking Environments

     LANs. LANs have traditionally been designed for client/server applications,
where traffic patterns were predictable and traffic loads are relatively stable.
In this environment, the majority of traffic remained within a given workgroup,
with only a small percentage traveling across the high traffic portion of a LAN
which interconnects all or a large part of the LAN. The increased use of
data-intensive, mission-critical applications, the widespread implementations of
intranets and extranets, and the ubiquity of Internet technologies have created
unpredictable traffic patterns, and unpredictable traffic loads within the LAN.
In addition, as users utilize the desktop browser and Internet technologies to
access significant amounts of information from servers located inside and
outside of the organization, a much higher percentage of traffic crosses the
enterprise LAN backbone. For example, an employee can make a simple request that
may require data to be downloaded and analyzed from multiple data warehouses
outside his or her local workgroup, resulting in increased traffic across the
LAN. Similarly, multiple users could request a multimedia presentation from a
company intranet or from the Internet consuming tremendous amounts of network
capacity. Either of these situations could result in users overwhelming a
company's enterprise LAN unknowingly. As a result, the increased traffic,
bandwidth-intensive applications and unpredictable traffic patterns are
straining traditional LAN environments and reducing the performance of
mission-critical applications.

     Early LANs supported limited numbers of users and used a variety of
protocols to organize the transmission of data, including Ethernet, Token Ring
or AppleTalk technologies. As the number of users and the amount of traffic on a
network grew, network performance began to decline. In this shared environment,
each desktop received and was burdened by the communication of every other
desktop. The need to improve network performance was initially addressed by
adding network devices known as bridges or hubs

                                       3
<PAGE>

that separated the entire LAN into smaller workgroups. This arrangement was
effective in supporting the traditional client/server environment where the
majority of traffic remained within the workgroup. As applications became more
bandwidth-intensive and users increasingly communicated outside of their
workgroup, bridges and hubs were unable to process this traffic effectively. To
mitigate this problem, Layer 2 switches were developed to provide a dedicated
link for each desktop and eliminate the unnecessary flow of information to every
desktop. In addition to the evolution of new devices, the need for increased
backbone speeds led to the development of new and faster technologies such as
FDDI, Fast Ethernet and ATM. However, each of these technologies employs
different protocols, further complicating the LAN by requiring software-based
routers that use expensive CPUs and software tables to route this multi-protocol
traffic. Today, it is not uncommon to find multiple protocols and devices across
the enterprise network.

     A network must be scalable in the following four dimensions:

     Speed. Speed refers to the number of bits per second that can be
transmitted across the network. Today's network applications increasingly
require speeds of up to 100 Mbps to the desktop. Hence, the backbone and server
connections that aggregate traffic from desktops require speeds well in excess
of 100 Mbps. Wire speed refers to the ability of a network device to process an
incoming data stream at the highest possible rate without loss of packets. Wire
speed routing refers to the ability to perform Layer 3 switching at the maximum
possible rate.

     Bandwidth. Bandwidth refers to the volume of traffic that a network or a
network device can handle before traffic is "blocked," or unable to get through
without interruption. When traffic was more predictable, the amount of traffic
across a network link or through a network device grew basically in line with
the number of users on the network. With today's data-intensive applications
accessed in random patterns from within and outside of the network, users can
spike traffic unpredictably, consuming significant bandwidth to the detriment of
other users.

     Network size. Network size refers to the number of users and servers that
are connected to a network. Today's networks must be capable of connecting and
supporting up to thousands, and even tens of thousands, of users and servers
while providing performance and reliable connectivity.

     Quality of service. Quality of service refers to the ability to control the
delivery of traffic based upon its level of importance. Mission-critical
enterprise and delay-sensitive multimedia applications require specific
performance minimums, while traffic such as general e-mail and Internet surfing
may not be as critical. In addition to basic standards-based prioritization of
traffic according to importance, true end-to-end quality of service would
allocate bandwidth to specified applications.

Opportunity for Next Generation Switching Solutions

     The emergence of several technology trends is enabling a new generation of
networking equipment that can meet the four scalability dimensions of today's
enterprise ISPs and metropolitan area networks by accommodating new
unpredictable traffic patterns and bandwidth-intensive, mission-critical
applications. First, while many new and different technologies have been
deployed in existing LANs, Ethernet has become the predominant LAN technology,
with over 97% of the market in 1999 and total shipments of over 490 million
ports from 1991 to 1999, according to the Dell'Oro Group. Ethernet has evolved
from the original 10 Mbps Ethernet to 100 Mbps Fast Ethernet and, in 1998, to
1,000 Mbps Gigabit Ethernet. Today, Gigabit ethernet and 10 gigabit ethernet
represent a viable network backbone protocol, enabling broadband connections to
be aggregated for network backbone transport across the metropolitan core.
Second, growth of the Internet and the subsequent development of application
based on Internet technologies have increased the use of the Internet Protocol.

     With the wide acceptance of Ethernet and Internet Protocol-based
technologies, the need to support a multi-protocol environment is diminished. As
a result, the simplified routing functionality can be embedded in application
specific integrated circuits, or ASICs, instead of in the software and CPUs used
in multi-protocol software-based routers. The resulting device, called a Layer 3
switch,

                                       4
<PAGE>

functions as a less expensive and significantly faster hardware-based router.
Layer 3 switches can operate at multi-gigabit speeds and, as hardware routers,
can support large networks. However, most Layer 3 switches still block traffic
in high utilization scenarios and can only support standards-based traffic
prioritization quality of service. While Layer 3 switching dramatically
increases network performance, many of today's offerings fail to realize the
potential of this technology because of the use of inconsistent hardware,
software and management architectures.

     To effectively address the needs of today's enterprise ISPs and metro area
networks, customers need a solution that is easy to use and implement an can
scale in terms of speed, bandwidth, network size and quality of service. Layer 3
switching represents the next critical step in addressing these requirements.
However, customers need a Layer 3 solution that provides sufficient bandwidth to
support unpredictable traffic spikes without impacting all other users connected
to the network. In addition, customers require a quality of service solution
that supports industry-standard prioritization and enables network
administrators to offer quality of service that maps business processes and
network policies. Finally, to simplify their networks, customers need a family
of interoperable devices that utilize a consistent hardware, software and
management architecture. Through an integrated family of products, network
managers can effectively deploy the solution at any point in the network and
follow a migration path to a network implemented with a consistent architecture
from end-to-end.

The Extreme Networks Solution

     Extreme provides broadband ethernet networking solutions that meet the
requirements of enterprise,ISPs and Metropolitan Area Networks by providing
increased performance, scalability, policy-based quality of service, ease of use
and lower cost of ownership. Our products share a common ASIC, software and
network management architecture that enables Layer 3 switching at wire speed in
each major area of the network. In addition, these products can be utilized by
ISPs and content providers for their web-hosting and server co-location
operations. Because our products are based on industry standard routing and
network management protocols, they are interoperable with existing network
infrastructures. We offer policy-based quality of service that controls the
delivery of network traffic according to pre-set policies that specify priority
and bandwidth limits. All of our switches allow the switch to be managed from
any browser-equipped desktop.

     The key benefits of Extreme's solutions are:

     High performance. Our products provide Broadband and IP services Ethernet
together with the non-blocking, wire-speed routing of our ASIC-based Layer 3
switching. Using our products, customers can achieve forwarding rates that are
up to 100 times faster than with software-based routers.

     Ease of use and implementation. Our products share a common ASIC, software
and network management architecture and offer consistent features for each of
the key areas of the network. Our standard-based products can be integrated into
and installed within existing networks. Customers can upgrade with Extreme
products without needing additional training. ExtremeWare software simplifies
network management by enabling customers to manage any of our products remotely
through a browser interface.

     Scalability. Our solutions offer customers the speed and bandwidth they
need today with the capability to scale their networks to support demanding
applications in the future without the burden of additional training or software
or system complexity. Customers who purchase our products can upgrade them to
advanced Layer 3 and Layer 4-7 capability because this functionality is built
into our ASICs.

     Quality of service. Extreme's policy-based quality of service enables
customers to prioritize mission-critical applications by providing
industry-leading tools for allocating network resources to specific
applications. With our policy-based quality of service, customers can use a
web-based interface to identify and control the delivery of traffic from
specific applications in accordance with specific policies that are set by the
customer. The quality of service functionality of our ASICs allows our
policy-based quality of service to be performed at wire speed. In addition to
providing priority, customers can allocate specified amounts of bandwidth to
specific applications or users.

     Lower cost of ownership. Our products are less expensive than
software-based routers, yet offer higher routing performance. Because they share
a common hardware, software and management architecture, we believe our products
can substantially reduce the cost and complexity of network management and
administration. This uniform architecture creates a simpler network
infrastructure which leverages the knowledge and resources businesses have
invested in Ethernet and the Internet Protocol, thereby requiring fewer
resources and less time to maintain.

                                       5
<PAGE>

The Extreme Networks Strategy

     Extreme's objective is to be the leading supplier of end-to-end network
solutions. The key elements of our strategy include:

     Provide easy to use, high-performance, cost-effective switching solutions.
We offer customers easy to use, powerful, cost-effective switching solutions
that meet the specific demands of switching environments in enterprise LANs,
ISPs and content providers. Our products provide customers with 1,000 Mbps
Gigabit Ethernet and the wire speed, non-blocking routing capabilities of
ASIC-based Layer 3 switching. We intend to capitalize on our expertise in
Ethernet, Internet protocol ("IP") and switching technologies to develop new
products based on our common architecture that meet the future requirements of
enterprise LANs, ISPs and content providers. These products will offer higher
performance with more advanced functionality and features while continuing to
reduce total cost of ownership for our customers.

     Expand market penetration. We are focused on product sales to new customers
across market segments, including ISPs, content providers and metropolitan area
networks, or MANs, and on extending our product penetration within existing
customers' networks. Once a customer buys our products for one area of their
network, our strategy is to then offer that customer products for other areas.
As additional products are purchased, a customer obtains the increased benefits
of our end-to-end solution by simplifying their networks, extending policy-based
quality of service and reducing costs of ownership while increasing performance.

     Extend switching technology leadership. Our technological leadership is
based on our custom ASICs and software and includes our wire-speed, Layer 3
switching, policy-based quality of service, routing protocols and ExtremeWare
software. We intend to invest our engineering resources in ASIC and other
development areas and provide leading edge technologies to increase the
performance and functionality of our products. We also intend to maintain our
active role in industry standards committees such as IEEE and IETF.

     Leverage and expand multiple distribution channels. We distribute our
products primarily through resellers and selected OEMs and through our field
sales team. To quickly reach a broad, worldwide audience, we have more than 250
resellers in 50 countries, including regional networking system resellers,
network integrators and wholesale distributors, and have established
relationships with select OEMs. We maintain a field sales force primarily to
support our resellers and to focus on select strategic and large accounts. We
intend to increase the size of our reseller programs and are developing two tier
distribution channels in some regions. To complement and support our domestic
and international reseller and OEM channels, we expect to increase our worldwide
field sales force.

     Provide high-quality customer service and support. We seek to enhance
customer satisfaction and build customer loyalty through the quality of our
service and support. We offer a wide range of standard support programs that
include emergency telephone support 24 hours a day, seven days a week and
advanced replacement of products. In addition, we have designed our products to
allow easy service and administration. For example, we can access all of our
switches remotely through a standard web browser to configure, troubleshoot and
help maintain our products. We intend to continue to enhance the ease of use of
our products and invest in additional support services by increasing staffing
and adding new programs for our OEMs and resellers. In addition, we also are
committed to providing customer-driven product functionality through feedback
from key prospects, consultants, channel and OEM partners and customer surveys.

Products

     Extreme provides broadband networking solutions that meet the requirements
of enterprise, ISPs and IP carrier and Metropolitan Area Networks by providing
increased performance, scalability, policy-based quality of service, ease of use
and lower cost of ownership. Our Summit, BlackDiamond and Alpine switches share
a common ASIC, software and management architecture that facilitates a
relatively short product design and development cycle, thereby reducing the
time-to-market for new products and features. This common architecture enables
customers to build a broadband networking solution that has consistent
functionality, performance and management. The common architecture and
end-to-end functionality of our products also reduces the cost and complexity of
network administration and management.

     The following table identifies our principal hardware and software
products:

                                       6
<PAGE>

<TABLE>
<CAPTION>
    Product name                                                   Product name
      and date of                                                  and date of
    first shipment   Configuration / Description                 first shipment   Configuration / Description
The Summit Stackable product family                         The BlackDiamond Modular Chassis
-----------------------------------                         --------------------------------
<S>                                                         <C>
Summit-based products:                                       BlackDiamond 6808         Up to 576 10/100 Mbps
  Summit4                  16 10/100 Mbps                       September 1998         Ethernet ports or 96
    March 1998             Ethernet ports and                                          Gigabit Ethernet ports in
                           6 Gigabit Ethernet ports                                    one chassis

   Summit24                24 10/100 Mbps                                              10 slots to accommodate
    November 1998          Ethernet ports                                              a variety of up to 8 connectivity
                           and                                                         modules and 1 or 2 management
                           1 Gigabit Ethernet ports                                    modules

  Summit48                 48 10/100 Mbps                   The Alpine Chassis
    April 1998             Ethernet ports and               ------------------
                           2 Gigabit Ethernet ports           Alpine 3808              Up to 256 10/100 Mbps
                                                                 April 2000            Ethernet ports or 32
                                                                                       Gigabit Ethernet ports in
                                                                                       one chassis
Inferno-based products:

  Summit1i                  8 Gigabit Ethernet ports                                   9 slots to accommodate
    September 2000                                                                     a variety of up to 8 connectivity
                                                                                       modules and 1 management
                                                                                       module
  Summit5i                 16 Gigabit Ethernet ports
    September 2000

  Summit7i                 32 Gigabit Ethernet ports          Software
    December 1999                                             --------
                                                               ExtremeWare             Software suite that has standard
                                                                September 1997         protocols, web-based
                                                                                       configuration and Policy-Based
                                                                                       Quality of Service

                                                               ExtremeWare Enterprise  An integrated management
                                                                Manager                application suite that protects
                                                                August 1998            the delivery of provisioned
                                                                                       services and applications

</TABLE>

     Summit Stackable Products

     Products in the Summit family of switches are designed to meet the
demanding requirements emerging in intranet and Internet applications. All
Summit switches share a common non-blocking switch architecture that provides
scalability in four areas: speed, bandwidth, network size and quality of service
(QoS). The Summit product family supports a range of gigabit and 10/100 Mbps
aggregation for enterprise desktops and servers, large Internet data centers,
and broadband points of presence ("POP") in metropolitan area networks and
multi-tenant buildings.

     The enterprise desktop is the portion of the network where individual
end-user workstations are connected to a hub or switch. In this shared
environment, each desktop in the workgroup receives and is burdened by the
communication of every other desktop in the workgroup. As applications have
become more bandwidth intensive and as user traffic has migrated outside the
workgroup via the Internet or an intranet or extranet, the hubs are unable to
effectively process this traffic, resulting in diminished desktop performance.
Replacing the hub with a Layer 3 switch alleviates this problem by providing a
dedicated link for each desktop and eliminating unnecessary broadcasts of
information to every desktop in the workgroup. Enterprise desktop switching
provides the desktop with features typically found only at the network core,
such as redundancy, greater speed and the ability to aggregate multiple switch
ports into a single high-bandwidth connection. Extreme became an industry leader
in Layer 3 switching for the desktop with the introduction of our Summit48 and
Summit24 desktop switching products. The Summit48 addresses high-density
enterprise desktop connections. This switch features a non-blocking architecture
to avoid the loss of data packets. The Summit24, with half the number of ports
of the Summit48, is targeted at local wiring closets with moderately dense
desktop connections.

     Servers run the applications and store the data needed by all network
end-users. The traditional network architecture has been shifting toward more
centralized server clusters, or server farms, which require the physical
deployment of multiple servers in a single central data center. This new
architecture is easier to manage and can be configured in a redundant fashion,
thereby reducing the risk of

                                       7
<PAGE>

system failure. Additionally, remote offices and telecommuters can access the
same server-based data as desktop users, increasing the flexibility of the
network to support users wherever they may be located. As more people access the
network and as server requests increasingly involve more bandwidth-intensive
applications, network traffic to and from servers has increased dramatically,
causing bandwidth to be consumed by traffic. Servers also communicate with each
other, creating a high volume of server-to-server traffic within the server
farm. Recent technology developments allow enterprises to install network
interface cards that enable connections using Gigabit Ethernet or the
aggregation of multiple 100 Mbps ports on a single card. This development
increases the communication speed of the servers. In turn, these servers have
created the need for switches that can support their higher server-to-server and
server-to-end-user communications speeds. Our Summit4 product addresses server
switching constraints by providing switched Gigabit Ethernet and multiple 100
Mbps links to the servers, thereby delivering sufficient bandwidth between
servers and to clients on attached segments. In server farms and data centers,
the Summit7i maximizes server availability and performance by combining server
load-balancing with wire-speed switching.

     As metropolitan area networks evolve to handle more data rather than voice,
the POP must also progress from serving as a simple transport device to an
application services tool. Today's broadband POPs are moving closer to the
customer and need to offer services density and scalability without
re-engineering discreet narrowband technologies. There is a growing need for
consistent scalable services in the multi-tenant market, which according to
Cahner's InStat Group will reach $2 billion by 2004. The new Summit1i and
Summit5i Gigabit Ethernet switching systems eliminate the limitations associated
with multiple narrowband aggregation technologies traditionally used in
metropolitan POPs.

     BlackDiamond Modular Chassis

     The BlackDiamond modular chassis delivers scalability, redundancy and high
reliability for core switching in high-density Ethernet/IP enterprise and
service provider networks. The BlackDiamond switch includes the fault-tolerant
features associated with mission-critical enterprise-class Layer 3 switching,
including redundant system management and switch fabric modules, hot-swappable
modules and chassis components, load-sharing power supplies and management
modules, up to eight 10 Mbps, 100 Mbps, or 1,000 Mbps aggregated links, dual
software images and system configurations, spanning tree and multipath routing,
and redundant router protocols for enhanced system reliability.

     The network core is the most critical point in the network, as it is where
the majority of network traffic, including desktop, segment and server traffic,
converges. Network core switching involves switching traffic from the desktops,
segments and servers within the network. Because of the high-traffic nature of
the network core, wire-speed Layer 3 switching, scalability, a non-blocking
hardware architecture, fault-tolerant mission-critical features, redundancy,
link aggregation, the ability to support a variety of high-density "speeds and
feeds" and the ability to accommodate an increasing number of high-capacity
backbone connections are critical in core switching.

     Alpine Chassis

     The Alpine 3808 chassis switch provides a simpler, more resilient broadband
infrastructure for metropolitan area networks ("MANs"), service provider data
centers, multi-tenant buildings and enterprise wiring closets. The Alpine 3808
is the industry's first broadband provisioning switch based on Ethernet and IP
that enables MANs and carriers to deliver more infrastructure bandwidth, slice
and dice that bandwidth for optimal usage, and guarantee fixed latency for
delay-sensitive services such as video and voice.

     ExtremeWare

     The ExtremeWare software suite combines industry-standard protocols to
provide interoperability with legacy switches and routers, plus Policy-Based
Quality of Service (QoS) for bandwidth management and traffic prioritization in
today's networks. With ExtremeWare, QoS policies are easy to define and assign
to traffic groups. The range of QoS profiles includes minimum bandwidth, maximum
bandwidth and relative priority. These QoS profiles are key to optimizing
bandwidth management effectiveness. Our policy-based quality of service also
enables network managers to define numerous levels of control, or policies, that
determine the amount of bandwidth available to a group of users or network
devices at a given time.

     ExtremeWare Enterprise Manager

     ExtremeWare Enterprise Manager is a value-added application suite that
makes it easier to perform configuration, troubleshooting and status monitoring,
and deploy multi-vendor policy-based management. ExtremeWare Enterprise Manager
offers a comprehensive

                                       8
<PAGE>

set of network management tools that are easy to use from a workstation with a
Java-enabled web browser. ExtremeWare Enterprise Manager simplifies the task of
managing and configuring groups of our switches. With ExtremeWare Enterprise
Manager, an entire network of our switches can be managed from a single
management console using a standard web browser.

     ExtremeWare ServiceWatch

     In August 2000 Extreme announced ExtremeWare ServiceWatch. This software is
designed to help businesses avoid costly downtime and help to ensure that
network services remain up and performing at peak levels. Just like the
telephone dial tone that indicates the availability and quality of voice
services, ServiceWatch delivers application dial tone to facilitate "always-on"
Layer 7 network services. It monitors and manages the response time of
mission-critical services such as e-mail, e-commerce and filer transfer
activities. If response time starts to degrade, ServiceWatch can be configured
to notify the network manager to take corrective action before a problem occurs.
ServiceWatch is also used as a bandwidth-capacity planning tool and can help
track ISP service level agreements (SLAs) using historical reporting and
graphing of service availability and response time.

Sales, Marketing and Distribution

     Extreme's sales and marketing strategy is focused on domestic and
international resellers, distributors, OEMs and field sales.

     Resellers. We have entered into agreements to sell our products through
more than 250 resellers in 50 countries. Our resellers include regional
networking system resellers, resellers who focus on specific vertical markets,
network integrators and wholesale distributors. We provide training and support
to our resellers and our resellers generally provide the first level of support
to end users of our products. We intend to increase the number of our reseller
relationships, to target vertical markets and support a two-tier distribution
channel.

     OEMs. We have established several key OEM relationships with leaders in the
telecommunications, personal computer and computer networking industries. We
intend to maintain a limited number of relationships with key strategic OEMs who
may offer products or distribution channels that compliment ours. Each of our
OEMs resells our products under its own name. We believe that our OEM
relationships enhance our ability to sell and provide support to large
organizations because certain end-user organizations may prefer to do business
with very large suppliers. We anticipate that OEM sales will decline as a
percentage of net revenue as we expand our reseller and fields sales efforts.

     Field sales. We have designed and established our field sales organization
to support and develop leads for our resellers and to establish and maintain a
limited number of key accounts and strategic customers. To support these
objectives, our field sales force:

 . assists end-user customers in finding solutions to complex network system and
  architecture problems;

 . differentiates the features and capabilities of our products from competitive
  offerings;

 . continually monitors and understands the evolving networking needs of
  enterprise customers;

 . promotes our products and ensures direct contact with current and potential
  customers; and

 . monitors the changing requirements of our customers.

     As of June 30, 2000, Extreme's worldwide sales and marketing organization
included 376 individuals, including managers, sales representatives, and
technical and administrative support personnel. We have domestic sales offices
located in major metropolitan areas in Arizona, California, Colorado,
Connecticut, District of Columbia, Florida, Georgia, Illinois, Kansas,
Massachusetts, Maryland, Michigan, North Carolina, New Jersey, New York, Ohio,
Oregon, Pennsylvania, Texas, Washington and Wisconsin. In addition, we have
international sales offices located in Argentina, Australia, Brazil, Chile,
Columbia, France, Germany, Hong Kong, Italy, Japan, Korea, The Netherlands,
Sweden and United Kingdom.

International sales

     We believe that there is a strong international market for our switching
products. Our international sales are conducted primarily through our overseas
offices and foreign resellers. Sales to customers outside of North America
accounted for approximately 45% of our net revenue in fiscal 2000.

                                       9
<PAGE>

Marketing

     We have a number of marketing programs to support the sale and distribution
of our products and to inform existing and potential customers and our
resellers, distributors and OEMs about the capabilities and benefits of our
products. Our marketing efforts include participation in industry tradeshows,
technical conferences and technology seminars, preparation of competitive
analyses, sales training, publication of technical and educational articles in
industry journals, maintenance of our web site, advertising and public
relations. In addition, we have begun to develop an e-commerce business directed
at resellers. We also participate in third-party, independent product tests.

Customer Support and Service

     Our customer service and support organization maintains and supports
products sold by our field sales force to end users, and provides technical
support to our resellers and OEMs. Generally, our resellers and OEMs provide
installation, maintenance and support services to their customers and we assist
our resellers and OEMs in providing such support.

     In addition to designing custom maintenance programs to satisfy specific
customer requirements, we also offer several standard maintenance programs to
our resellers and customers, including ExtremeAssist Basic, ExtremeAssist1,
ExtremeAssist2, ExtremeAssist Premium and ExtremeAssist Elite.

     ExtremeAssist Basic. This program is designed for customers who are
interested in keeping service and support costs to a minimum but want access to
basic support services. Basic service includes access to Extreme's
web-accessible knowledge database and software upgrades and bug fixes. The
ExtremeAssist program includes eight-hour, five-day technical assistance center
telephone support, e-mail inquiries and responses within 24 hours and
rapid-response emergency/network down telephone support 24 hours a day, 7 days a
week.

     ExtremeAssist1. This program is designed for customers who have strong
technical networking skills and are interested in keeping service and support
costs to a minimum. With ExtremeAssist1, the customers' information technology
organizations provide first-level support for configuration, hardware and
trouble shooting, while Extreme's technical assistance center provides advanced
second-level support on an essential need basis. The ExtremeAssist1 program
includes all the features in ExtremeAssist Basic plus 48-hour advanced
replacement of hardware.

     ExtremeAssist2. This program is designed for network environments that
require a high degree of network availability, data integrity and end-user
productivity. The ExtremeAssist2 program includes all the features in
ExtremeAssist1 plus twelve-hour, five-day technical assistance center telephone
support and next business day replacement of hardware.

     As switched broadband infrastructures become more vital to a company's
ability to compete, networks are doing much more than just sharing and
distributing information. Networks have become the brains of day-to-day business
operations and are the key to reducing time to market and sharpening a company's
competitive edge. Extreme recognizes the critical nature of the switched
broadband infrastructure in today's business environment and the ever-expanding
demands that will be put on networks in the future. To meet these needs, Extreme
has developed a series of comprehensive on-site support plans to fit the needs
of the most demanding network environments.

     ExtremeAssist Premium. ExtremeAssist Premium is designed to meet and exceed
all the essential requirements of supporting and maintaining enterprise LANs.
Ideal for mission-critical network environments that require a high degree of
network availability, data integrity and end-user productivity. The
ExtremeAssist Premium plan includes faster on-site service and spares. The
ExtremeAssist Premium program includes all the features in ExtremeAssist2 plus
24 hours a day, 7 days a week on-site emergency network down assistance within 4
hours.

     ExtremeAssist Elite. ExtremeAssist Elite is Extreme's most comprehensive
support plan for mission-critical switched broadband networks. Elite is limited
to the top 20% of Extreme's customer base to ensure a very individualized,
flexible and focused approach to providing Elite support services. ExtremeWorks
Elite adds dedicated level 3 technical support engineers and our fastest on-site
service and spares response time.

     We typically provide end users with a one-year hardware and 90-day software
warranty. We also offer various training courses for their third-party resellers
or end-user customers.

                                       10
<PAGE>

Manufacturing

     We outsource the majority of our manufacturing and supply chain management
operations, and we conduct quality assurance, manufacturing engineering,
documentation control and repairs at our facility in Santa Clara, California.
This approach enables us to reduce fixed costs and to provide flexibility in
meeting market demand. Where cost-effective, we may begin to perform certain of
our non-manufacturing outsourced operations in-house.

     Currently, we use three contract manufacturers--Flextronics, located in San
Jose, California, to manufacture our Summit1, Summit4, Summit RPS and
BlackDiamond products, MCMS, located in Boise, Idaho, to manufacture our
Summit24, Summit48, Summit1i, Summit5i and Summit7i products and Solectron,
located in Milpitas, California, to manufacture our Alpine products. Each of
these manufacturing processes and procedures is ISO 9002 certified. We design
and develop the key components of our products, including ASICs and printed
circuit boards. In addition, we determine the components that are incorporated
in our products and select the appropriate suppliers of such components. Product
testing and burn-in is performed by our contract manufacturers using tests we
specify and automated testing equipment. We also use comprehensive inspection
testing and statistical process controls to assure the quality and reliability
of our products. We intend to regularly introduce new products and product
enhancements, which will require that we rapidly achieve volume production by
coordinating our efforts with those of our suppliers and contract manufacturers.
See "Factors That May Affect Our Results--Extreme Needs to Expand Its
Manufacturing Operations and Depends on Contract Manufacturers for Substantially
All of Its Manufacturing Requirements."

     Although we use standard parts and components for our products where
possible, we currently purchase several key components used in the manufacture
of our products from single or limited sources. Our principal single-sourced
components include:

     . ASICs;
     . microprocessors;
     . programmable integrated circuits;
     . selected other integrated circuits;
     . cables; and
     . custom-tooled sheet metal.

Our principal limited-source components include:

     . flash memories;
     . DRAMs;
     . SRAMs; and
     . printed circuit boards.

     Generally, purchase commitments with our single or limited source suppliers
are on a purchase order basis. LSI Logic manufacturers all of our ASICs which
are used in all of our switches. Any interruption or delay in the supply of any
of these components, or the inability to procure these components from alternate
sources at acceptable prices and within a reasonable time, would materially
adversely affect our business, operating results and financial condition. In
addition, qualifying additional suppliers can be time-consuming and expensive
and may increase the likelihood of errors.

     We use a rolling nine-month forecast based on anticipated product orders to
determine our material requirements. Lead times for materials and components we
order vary significantly, and depend on factors such as the specific supplier,
contract terms and demand for a component at a given time. See "Factors That May
Affect Our Results--Extreme Purchases Several Key Components for Products From
Single or Limited Sources and Could Lose Sales if These Sources Fail to Fill Its
Needs" and "--Extreme Needs To Expand Its Manufacturing Operations and Depends
on Contract Manufacturers for Substantially All of Its Manufacturing
Requirements."

Research and Development

     We believe that our future success depends on our ability to continue to
enhance our existing products and to develop new products that maintain
technological competitiveness. We focus our product development activities on
solving the needs of enterprise, service providers and IP carrier and
Metropolitan Area Network markets. We monitor changing customer needs and work
closely with

                                       11
<PAGE>

users, value-added resellers and distributors, and market research organizations
to monitor changes in the marketplace. We design our products around current
industry standards and will continue to support emerging standards that are
consistent with our product strategy.

     Our products have been designed to incorporate the same core ASICs and
software and system architecture, facilitating a relatively short product design
and development cycle and reducing the time to market for new products and
features. We have utilized this architectural design to develop and introduce
other product models and enhancements since the introduction of our first
products in 1997. We intend to continue to utilize this architectural design to
develop and introduce additional products and enhancements in the future.

     We are undertaking development efforts for our family of products with
emphasis on increasing reliability, performance and scalability and reducing the
overall network operating costs to end users. This fiscal year we introduced a
new generation chipset which was incorporated in a new product family which
began shipping in the quarter ended December 31. We are also focusing on cost
reduction engineering to reduce the cost of our products. There can be no
assurance that our product development efforts will result in commercially
successful products, or that our products will not be rendered obsolete by
changing technology or new product announcements by other companies. See
"Factors That May Affect Our Results--Extreme's Market is Subject to Rapid
Technological Change and to Compete, Extreme Must Continually Introduce New
Products that Achieve Broad Market Acceptance."

Competition

     The market for internet switches is part of the broader market for
networking equipment, which is dominated by a few large companies, particularly
Cabletron Systems, Cisco Systems, Lucent Technologies and Nortel Networks. Each
of these companies has introduced, or has announced its intention to develop,
switches that are or may be competitive with our products. For example, in
January 1999, Cisco announced its Catalyst 6000 family of chassis-based
switches. In addition, there are a number of large telecommunications equipment
providers, including Alcatel, Ericsson, Nokia, and Siemens, which have entered
the market for network equipment, particularly through acquisitions of public
and privately held companies. We expect to face increased competition,
particularly price competition, from these and other telecommunications
equipment providers. We also expect to compete with other public and private
companies that offer switching solutions, such as Alteon Web Systems and Foundry
Networks. These vendors may develop products with functionality similar to our
products or provide alternative network solutions. Our OEMs may compete with us
with their current products or products they may develop, and with the products
they purchase from us. Current and potential competitors have established or may
establish cooperative relationships among themselves or with third parties to
develop and offer competitive products. Furthermore, we compete with numerous
companies that offer routers and other technologies and devices that
traditionally have managed the flow of traffic on the enterprise or metropolitan
area networks.

     Many of our current and potential competitors have longer operating
histories and substantially greater financial, technical, sales, marketing and
other resources, as well as greater name recognition and a larger installed
customer base, than we do. As a result, these competitors are able to devote
greater resources to the development, promotion, sale and support of their
products. In addition, competitors with a large installed customer base may have
a significant competitive advantage over us. We have encountered, and expect to
continue to encounter, many potential customers who are extremely confident in
and committed to the product offerings of our principal competitors, including
Cisco Systems and Nortel Networks. Accordingly, such potential customers may not
consider or evaluate our products. When such potential customers have considered
or evaluated our products, we have in the past lost, and expect in the future to
lose, sales to some of these customers as large competitors have offered
significant price discounts to secure such sales.

     We believe the principal competitive factors in the network switching
market are:

     . expertise and familiarity with network protocols, network switching and
       network management;
     . product performance, features, functionality and reliability;
     . price/performance characteristics;
     . timeliness of new product introductions;
     . adoption of emerging industry standards;
     . customer service and support;
     . size and scope of distribution network;

                                       12
<PAGE>

     . brand name;
     . access to customers; and
     . size of installed customer base.

     We believe we compete favorably with our competitors with respect to each
of the foregoing factors. However, because many of our existing and potential
competitors have longer operating histories, greater name recognition, larger
customer bases and substantially greater financial, technical, sales, marketing
and other resources, they may have larger distribution channels, stronger brand
names, access to more customers and a larger installed customer base than we do.
Such competitors may, among other things, be able to undertake more extensive
marketing campaigns, adopt more aggressive pricing policies and make more
attractive offers to distribution partners than we can. To remain competitive,
we believe we must, among other things, invest significant resources in
developing new products and enhancing our current products and maintain customer
satisfaction worldwide. If we fail to do so, our products will not compete
favorably with those of our competitors which will materially adversely affect
our business. See "Factors That May Affect Our Results--Intense Competition in
the Market for Networking Equipment Could Prevent Extreme From Increasing
Revenue and Prevent Extreme From Achieving or Sustaining Profitability."

Intellectual Property

     We rely on a combination of patent, copyright, trademark and trade secret
laws and restrictions on disclosure to protect our intellectual property rights.
We have been issued six patents in the U.S. We have filed eight patent
applications in the U.S. and selected countries abroad relating to the
architecture of our network switches and quality of service features. There can
be no assurance that these applications will be approved, that any issued
patents will protect our intellectual property or that they will not be
challenged by third parties. Furthermore, there can be no assurance that others
will not independently develop similar or competing technology or design around
any patents that may be issued. We also have five registered trademarks and four
pending trademark applications in the U.S.

     We also enter into confidentiality or license agreements with our
employees, consultants and corporate partners, and control access to and
distribution of our software, documentation and other proprietary information.
In addition, we provide our software products to end-users primarily under
"shrink-wrap" license agreements included within the packaged software. These
agreements are not negotiated with or signed by the licensee, and thus these
agreements may not be enforceable in some jurisdictions. Despite our efforts to
protect our proprietary rights, unauthorized parties may attempt to copy or
otherwise obtain and use our products or technology. There can be no assurance
that these precautions will prevent misappropriation or infringement of our
intellectual property. Monitoring unauthorized use of our products is difficult,
and we cannot be certain that the steps we have taken will prevent
misappropriation of our technology, particularly in foreign countries where the
laws may not protect our proprietary rights as fully as in the United States.

     The networking industry is characterized by the existence of a large number
of patents and frequent claims and related litigation regarding patent and other
intellectual property rights. In particular, leading companies in the data
communications and networking markets have extensive patent portfolios with
respect to networking technology. From time to time, third parties, including
these leading companies, have asserted and may assert exclusive patent,
copyright, trademark and other intellectual property rights against us. Indeed,
a number of third parties, including leading companies, have asserted patent
rights to technologies and related standards that are important to us. We expect
to increasingly be subject to infringement claims asserted by third parties as
the numbers of products and competitors in the market for network switches grow
and the functionality of products overlaps. In this regard, since April, 2000,
we have been in communication with one of these leading companies that believes
certain of our products require a license under a number of their patents. The
third party is willing to grant us a non-exclusive license under the identified
patents as well as other patents or technology that we may require. We currently
are reviewing the identified patents to examine whether we consider a license
necessary. However, there can be no assurance that this license would be
obtainable on commercially acceptable terms.

     Although we have not been a party to any litigation asserting claims that
allege infringement of intellectual property rights, we cannot assure you that
we will not be a party to litigation in the future. In addition, we cannot
assure you that third parties will not assert additional claims or initiate
litigation against us or our manufacturers, suppliers or customers alleging
infringement of their proprietary rights with respect to existing or future
products.

     We may in the future initiate claims or litigation against third parties
for infringement of our proprietary rights to determine the

                                       13
<PAGE>

scope and validity of our proprietary rights. Any such claims, with or without
merit, could be time-consuming, result in costly litigation and diversion of
technical and management personnel or require us to develop non-infringing
technology or enter into royalty or licensing agreements. Such royalty or
licensing agreements, if required, may not be available on acceptable terms, if
at all. In the event of a successful claim of infringement and our failure or
inability to develop non-infringing technology or license the proprietary rights
on a timely basis, our business, operating results and financial condition could
be materially adversely affected.

Employees

     As of June 30, 2000, we employed 680 persons, including 376 in sales and
marketing, 110 in research and development, 67 in operations, 65 in technical
support and 62 in finance and administration. We have never had a work stoppage
and no personnel are represented under collective bargaining agreements. We
consider our employee relations to be good.

     We believe that our future success will depend on our continued ability to
attract, integrate, retain, train and motivate highly qualified personnel, and
upon the continued service of our senior management and key personnel. None of
our personnel is bound by an employment agreement. Competition for qualified
personnel is intense, particularly in the San Francisco Bay Area, where our
headquarters is located. At times we have experienced difficulties in attracting
new personnel. There can be no assurance that we will successfully attract,
integrate, retain and motivate a sufficient number of qualified personnel to
conduct our business in the future. See "Factors That May Affect Our Results--If
Extreme Loses Key Personnel or is Unable to Hire Additional Qualified Personnel
as Necessary, It May Not Be Able to Successfully Manage Its Business or Achieve
Its Objectives."

Item 2. Properties.

     Our principal administrative, sales, marketing and research development
facilities are located in an approximately 77,000 square feet facility located
in Santa Clara, California. In June 2000, we entered into a five-year operating
lease agreement to lease 275,000 square feet in Santa Clara, California to house
further physical expansion of our principal operations. We also lease office
space in various other geographic locations domestically and internationally for
sales and service personnel.

Item 3. Legal Proceedings.

     We are not aware of any pending legal proceedings against us that,
individually or in the aggregate, would have a material adverse effect on our
business, operating results or financial condition. We may in the future be
party to litigation arising in the course of our business, including claims that
we allegedly infringe third-party trademarks and other intellectual property
rights. Such claims, even if not meritorious, could result in the expenditure of
significant financial and managerial resources.

Item 4. Submission of Matters to a Vote of Security Holders.

    Not applicable.

Executive Officers of the Registrant

     The following table sets forth information regarding the executive officers
of Extreme as of August 31, 2000:

<TABLE>
<CAPTION>
 Name                                                         Age                            Position
 ----                                                         ---                            --------
<S>                                                           <C>   <C>
Gordon L. Stitt..........................................     44    President, Chief Executive Officer and Chairman
Stephen Haddock..........................................     42    Vice President and Chief Technical Officer
Herb Schneider...........................................     41    Vice President of Engineering
Sam Halabi...............................................     35    Vice President of IP Carrier Business Development
June Hull................................................     45    Vice President of Human Resources
Allan G. Miller..........................................     48    Vice President of Manufacturing Operations
Vito E. Palermo..........................................     36    Vice President, Chief Financial Officer and Secretary
George Prodan............................................     47    Vice President of Marketing
Harry Silverglide........................................     54    Vice President of Sales
</TABLE>

     Gordon L. Stitt. Mr. Stitt co-founded Extreme in May 1996 and has served as
President, Chief Executive Officer and a director of Extreme since its
inception. From 1989 to 1996, Mr. Stitt worked at another company he co-founded,
Network Peripherals, a designer and manufacturer of high-speed networking
technology. He served first as its Vice President of Marketing, then as Vice
President and General Manager of the OEM Business Unit. Mr. Stitt holds an MBA
from the Haas School of Business of the University of

                                       14
<PAGE>

California, Berkeley and a BSEE/CS from Santa Clara University.

     Stephen Haddock. Mr. Haddock co-founded Extreme in May 1996 and has served
as Vice President and Chief Technical Officer of Extreme since its inception.
From 1989 to 1996, Mr. Haddock worked as Chief Engineer at Network Peripherals.
Mr. Haddock is a member of IEEE, an editor of the Gigabit Ethernet Standard and
Chairman of the IEEE 802.3ad link aggregation committee. Mr. Haddock holds an
MSEE and a BSME from Stanford University.

     Herb Schneider. Mr. Schneider co-founded Extreme in May 1996 and has served
as Vice President of Engineering of Extreme since its inception. From 1990 to
1996, Mr. Schneider worked as Engineering Manager at Network Peripherals and was
responsible for the development of LAN switches. From 1981 to 1990, Mr.
Schneider held various positions at National Semiconductor, a developer and
manufacturer of semiconductor products, where he was involved in the development
of early Ethernet chipsets and FDDI chipsets. Mr. Schneider holds a BSEE from
the University of California, Davis.

     Sam Halabi. Mr. Halabi has served as Vice President of IP Carrier business
development of Extreme since July 2000. Prior to joining Extreme Networks, Mr.
Halabi held various marketing positions with leading data communications
companies, including Cisco Systems. Mr. Halabi holds a MS in Computer Science
from San Jose State University and a BS in Computer Engineering from American
University-Beirut.

     June Hull. Ms. Hull has served as Vice President of Human Resources since
September 1999. From October 1996 to August 1999, she served as Regional
Director of Human Resources and Corporate Director of Human Resources at
Netscape Communications, an e-commerce company. From April 1989 to September
1996, she served in a variety of senior Human Resource management positions for
Apple Computer, Inc.

     Allan G. Miller. Mr. Miller has served as Vice President of Manufacturing
Operations of Extreme since July 2000. Prior to joining Extreme Networks, Mr.
Miller spent 22 years at Amdahl Corporation. He held several senior management
positions in manufacturing operations and quality assurance, the most recent was
Vice President of Operations. He holds a MS in Mechanical Engineering and a MBA
from the University of California at Berkeley and a BS in Mechanical Engineering
from California State University, Northridge.

     Vito E. Palermo. Mr. Palermo has served as Vice President, Chief Financial
Officer and Secretary of Extreme since January 1999. From January 1997 to
January 1999, he served as Senior Vice President, Chief Financial Officer and
Secretary of Metawave Communications, a wireless communications company. From
1992 to 1996, Mr. Palermo served in various financial management positions at
Bay Networks, a networking communications company, most recently serving as Vice
President and Corporate Controller and previously serving as Director of
Technology Finance, Corporate Financial and Planning Manager, and Manufacturing
and Customer Service Controller. Mr. Palermo holds an MBA from St. Mary's
College and a BS in Business Administration from California State University.

     George Prodan. Mr. Prodan has served as Vice President of Marketing of
Extreme since February 1997. From January 1994 to January 1997, he served as
Director of Marketing and Senior Director of Worldwide Channels at FORE Systems,
a networking equipment company. From April 1991 to December 1993, he served as a
product line manager for a division of 3Com, a networking company. He holds an
MS in Instructional Communications from Shippensburg State University and a BS
in Industrial Arts Education from California State University.

     Harry Silverglide. Mr. Silverglide has served as Vice President of Sales of
Extreme since January 1997. From May 1995 to January 1997, he served as Vice
President of Western Region Sales for Bay Networks. From July 1994 to May 1995,
he served as Vice President of Sales for Centillion Networks, a provider of LAN
switching products which was acquired by Bay Networks in 1995. From April 1984
to July 1994, he worked in sales and senior sales management positions at
Ungermann Bass, a network communications company.

                                       15
<PAGE>

                                     PART II

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters.

    The Company's common stock commenced trading on the Nasdaq National Market
on April 9, 1999 under the symbol "EXTR." The following table sets forth the
high and low closing prices as reported by Nasdaq. Such prices represent prices
between dealers, do not include retail mark-ups, mark-downs or commissions and
may not represent actual transactions. All prices have been adjusted to reflect
a 2-for-1 stock split effected in August 2000.

<TABLE>
<CAPTION>

      Stock Prices                                                       High             Low
                                                                         ----             ---
<S>                                                                 <C>             <C>
      1999
      Fourth quarter (1)............................................$     29.03      $     19.16
      2000
      First quarter.................................................$     42.25      $     22.81
      Second quarter................................................$     49.03      $     30.66
      Third quarter.................................................$     59.50      $     38.00
      Fourth quarter................................................$     52.75      $     21.44
</TABLE>

    --------------
    (1) Commencing April 9, 1999

    At September 14, 2000, there were approximately 284 stockholders of record
of the Company's common stock and approximately 36,000 beneficial stockholders.
The Company has never declared or paid cash dividends on its capital stock and
does not anticipate paying any cash dividends in the foreseeable future. The
Company currently intends to retain future earnings for the development of its
business.

Item 6. Selected Consolidated Financial Data.

<TABLE>
<CAPTION>
                                                                                                                   For the  Period
                                                                                                                      from May 8,
                                                                                                                         1996
                                                                                                                       (Date of
                                                                                     Years Ended June 30,             Inception)
                                                                                     --------------------
                                                                                2000         1999          1998      June 30, 1997
                                                                                ----         ----          ----      -------------
                                                                                   (In thousands, except per share amounts)
                                                                                   ----------------------------------------
<S>                                                                            <C>           <C>           <C>      <C>
Consolidated Statements of Operations Data:
Net revenue...................................................                $  261,956    $ 98,026     $ 23,579      $    256
Gross profit (loss)...........................................                   135,040      49,506        8,682          (132)
Total operating expenses......................................                   118,786      50,951       22,709         7,928
Operating income (loss).......................................                    16,254      (1,445)     (14,027)       (8,060)
Net income (loss).............................................                    20,048      (1,617)     (13,936)       (7,923)
Basic net income (loss) per share (1).........................                $     0.20    $  (0.09)    $  (1.59)     $  (2.26)
Diluted net income (loss) per share (1).......................                $     0.18    $  (0.09)    $  (1.59)     $  (2.26)
Weighted average shares outstanding used in
    computing basic  net income (loss) per share (1)...........                  100,516      18,924        8,758         3,516
Weighted average shares outstanding used in
    computing diluted net income (loss) per share (1).........                   111,168      18,924        8,758         3,516
</TABLE>

                                       16
<PAGE>

<TABLE>
<CAPTION>
                                                                                       As of June 30,
                                                                            -----------------------------------
                                                                                2000         1999          1998
                                                                                ----         ----          ----
                                                                                              (In thousands)
<S>                                                                          <C>           <C>           <C>
Consolidated Balance Sheets Data
Cash and cash equivalents.....................................                $116,721      $107,143     $  9,510
Short-term investments........................................                  66,640        16,422       10,995
Working capital...............................................                 205,881       119,039       13,796
Total assets..................................................                 515,930       171,803       33,731
Long-term debt, deposit and capital lease
 obligations, net of current portion..........................                     306         --           2,634
Total stockholders' equity....................................                $419,021      $141,876     $ 15,869
</TABLE>

    ------------------
    (1) Share and per share data have been restated to give retroactive effect
to a two-for-one stock split in the form of a stock dividend effected in August
2000.

Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations.

    When used in this discussion and elsewhere in this Form 10-K, the words
"may," "should," "believes," "expects," "anticipates," "estimates" and similar
expressions identify forward-looking statements. Such statements, which include
statements concerning the availability and functionality of products under
development, product mix, pricing trends, the mix of export sales, sales to
significant customers and the availability and cost of products from the
Company's suppliers, are subject to risks and uncertainties, including those set
forth below under "Factors That May Affect Our Results." Our actual results
could differ materially from those anticipated in these forward-looking
statements which could have a material adverse effect on our business, operating
results and financial condition. These forward-looking statements speak only as
of the date hereof and there may be events in the future that we are not able to
predict accurately or over which we have no control which would affect or alter
our expectations.

Overview

     From our inception in May 1996 through September 1997, our operating
activities related primarily to developing a research and development
organization, testing prototype designs, building an ASIC design infrastructure,
commencing the staffing of our marketing, sales and field service and technical
support organizations, and establishing relationships with resellers and OEMs.
We commenced volume shipments of our Summit1 and Summit2, the initial products
in our Summit stackable product family, in October 1997, and we began shipping
our BlackDiamond modular product family in September 1998. We introduced our new
Alpine product family in fiscal 2000 which is based on a new generation chip
set. In addition, we also introduced new products within our existing product
lines that incorporate this new chip set.

     Our revenue is derived primarily from sales of our Summit and BlackDiamond
product families and fees for services relating to our products, including
maintenance and training. The level of sales to any customer may vary from
period to period; however, we expect that significant customer concentration
will continue for the foreseeable future. See "Factors That May Affect Our
Results--If a Key Reseller, OEM or Other Significant Customer Cancels or Delays
a Large Purchase, Extreme's Revenues May Decline and the Price of Its Stock May
Fall." For fiscal 2000, there were no customers with sales greater than 10%. For
fiscal 1999, Compaq and Hitachi Cable accounted for 21% and 13% of our net
revenue, respectively.

     We market and sell our products primarily through resellers, distributors
and, to a lesser extent, OEMs and our field sales organization. We sell our
products through more than 250 resellers in 50 countries. In fiscal 2000, sales
to customers outside of North America accounted for approximately 45% of our net
revenue. Currently, all of our international sales are denominated in U.S.
dollars. We generally recognize product revenue at the time of shipment, unless
we have future obligations for installation or have to obtain customer
acceptance, in which case revenue is deferred until such obligations have been
satisfied. We have established a program which, under specified conditions,
enables third party resellers to return products to us. The amount of potential
product returns is estimated and provided for in the period of the sale. Service
revenue is recognized ratably over the term of the contract period, which is
typically 12 months.

     We expect to experience rapid erosion of average selling prices of our
products due to a number of factors, including competitive

                                       17
<PAGE>

pricing pressures, promotional pricing and rapid technological change. Our gross
margins will be affected by such declines and by fluctuations in manufacturing
volumes, component costs and the mix of product configurations sold. In
addition, our gross margins may fluctuate due to the mix of distribution
channels through which our products are sold, including the potential effects of
our development of a two-tier distribution channel. We generally realize higher
gross margins on sales to resellers and distributors than on sales through our
OEMs. Any significant decline in sales to our OEMs or resellers or distributors,
or the loss of any of our OEMs or resellers or distributors could materially
adversely affect our business, operating results and financial condition. In
addition, new product introductions may result in excess or obsolete
inventories. Any excess or obsolete inventories may also reduce our gross
margins.

     We outsource the majority of our manufacturing and supply chain management
operations, and we conduct quality assurance, manufacturing engineering,
documentation control and repairs at our facility in Santa Clara, California.
Accordingly, a significant portion of our cost of revenue consists of payments
to our contract manufacturers, Flextronics, MCMS and Solectron. We expect to
realize lower per unit product costs as a result of volume efficiencies.
However, we cannot assure you when or if such price reductions will occur. The
failure to obtain such price reductions could materially adversely affect our
gross margins and operating results.

     Research and development expenses consist principally of salaries and
related personnel expenses, consultant fees and prototype expenses related to
the design, development, testing and enhancement of our products. We expense all
research and development expenses as incurred. We believe that continued
investment in research and development is critical to attaining our strategic
objectives and, as a result, we expect these expenses to increase in absolute
dollars in the future.

     Sales and marketing expenses consist of salaries, commissions and related
expenses for personnel engaged in marketing, sales and field service support
functions, as well as trade shows and promotional expenses. We intend to pursue
sales and marketing campaigns aggressively and therefore expect these expenses
to increase significantly in absolute dollars in the future. In addition, we
recently hired approximately 200 sales and marketing personnel. We expect to
continue to expand our field sales operations to support and develop leads for
our resellers and distributors, which will also result in an increase in sales
and marketing expenses.

     General and administrative expenses consist primarily of salaries and
related expenses for executive, finance and administrative personnel,
professional fees and other general corporate expenses. We expect general and
administrative expenses to increase in absolute dollars as we add personnel,
increase spending on our information systems and incur additional costs related
to the anticipated growth of our business and operation as a public company.

     During fiscal 1998, in connection with the grant of certain stock options
to employees, we recorded deferred stock compensation of $437,000 representing
the difference between the exercise price and the deemed fair value of our
common stock on the date such stock options were granted. Such amount is
included as a reduction of stockholders' equity and is being amortized by
charges to operations on a graded vesting method. We recorded amortization of
deferred stock compensation expense of approximately $119,000, $172,000 and
$68,000 for the years ended June 30, 2000, 1999 and 1998, respectively. At June
30, 2000, we had a total of approximately $78,000 remaining to be amortized over
the corresponding vesting period of each respective option, generally four
years. The amortization expense relates to options awarded to employees in all
operating expense categories.

     Despite growing revenues in all fiscal years since our inception, fiscal
2000 was the first year we have achieved profitability in each of the four
quarters. Our net income has not increased proportionately with the increase in
our revenue primarily because of increased expenses relating to our growth in
operations and in particular the recent accelerated hiring of sales and
marketing personnel. Because of the lengthy sales cycle of our products, there
is often a significant delay between the time we incur expenses and the time we
realize any related revenue. See "Factors That May Affect Our Results--The Sales
Cycle for Extreme's Products is Long and Extreme May Incur Substantial
Non-Recoverable Expenses or Devote Significant Resources to Sales that Do Not
Occur When Anticipated." To the extent that future revenues do not increase
significantly in the same periods in which operating expenses increase, our
operating results would be adversely affected. See "Factors That May Affect Our
Results--A Number of Factors Could Cause Extreme's Quarterly Financial Results
to Be Worse Than Expected, Resulting in a Decline in Its Stock Price."

    Due to the Company's issuance of warrants to a networking company as
discussed in Note 3, future operating income will be reduced by $7.1 million per
quarter for each quarter in fiscal 2001 and for three of the four fiscal
quarters in fiscal 2002. Notwithstanding this charge the Company still
anticipates being profitable in the first quarter of fiscal 2001.

Results of Operations

                                       18
<PAGE>

    The following table sets forth for the years indicated certain financial
data as a percentage of net revenue:


<TABLE>
<CAPTION>
                                                   Years ended June 30,
                                            ---------------------------------
                                               2000        1999        1998
                                               ----        ----        ----
<S>                                          <C>          <C>        <C>
Net revenue............................       100.0%      100.0%      100.0%
Cost of revenue........................        48.5        49.5        63.2
                                              -----       -----       -----
Gross profit ..........................        51.5        50.5        36.8
Operating expenses:
  Research and development.............        12.6        17.4        45.2
  Sales and marketing..................        25.6        27.6        40.7
  General and administrative...........         4.5         7.0        10.4
  Amortization of goodwill and
    purchased intangibles                       2.6         --           --
                                              -----       -----      ------
          Total operating expenses.....        45.3        52.0        96.3
                                              -----       -----      ------
Operating income (loss)................         6.2        (1.5)      (59.5)
Interest income........................         5.6         1.9         2.6
Interest expense.......................         (.2)        (.4)       (1.4)
Other income (loss), net...............          --          --         (.8)
                                              -----       -----      ------
Income (loss) before income taxes......        11.6          .0       (59.1)
Provision for income taxes.............         3.9         1.7          --
                                              -----       -----      ------
Net income (loss)......................         7.7%       (1.7)%     (59.1)%
                                              =====       =====      ======
</TABLE>


Net Revenue

     Net revenue increased from $98.0 million in fiscal 1999 to $262.0 million
in fiscal 2000, an increase of $164.0 million. The increase in net revenue for
fiscal 2000 resulted primarily from increased sales of our Summit stackable
products and our BlackDiamond modular product family, the market's growing
acceptance of Extreme's existing and new product offerings, and a significant
increase in our sales and marketing organizations.

     Net revenue increased from $23.6 million in fiscal 1998 to $98.0 million in
fiscal 1999, an increase of $74.4 million. The increase in net revenue for
fiscal 1999 resulted primarily from increased sales of our Summit stackable
products and the introduction of our BlackDiamond modular product family in
September 1998.

     Export sales accounted for 45% and 53% of net revenue in fiscal 2000 and
fiscal 1999, respectively. We expect that export sales will continue to
represent a significant portion of net revenue, although we cannot assure you
that export sales as a percentage of net revenue will remain at current levels.
All sales transactions are denominated in U.S. dollars.

Gross Profit

     Gross profit increased from $49.5 million in fiscal 1999 to $135.0 million
in fiscal 2000, an increase of $85.5 million, primarily due to the related
increase in revenue. Gross margins increased from 50.5% in fiscal 1999 to 51.5%
in fiscal 2000. The increase in gross margin resulted primarily from a shift in
product mix, a shift in our channel mix from OEMs to resellers and distributors
and improved manufacturing efficiencies, offset in part by lower average selling
prices due primarily to increased competition.

     Gross profit increased from $8.7 million in fiscal 1998 to $49.5 million in
fiscal 1999, an increase of $40.8 million. Gross margins increased from 36.8% in
fiscal 1998 to 50.5% in fiscal 1999. The increase in gross margin resulted
primarily from reductions in component costs, improved manufacturing
efficiencies and a shift in our channel mix from OEMs to resellers, which were
offset in part by lower average selling prices due to increased competition.

Research and Development Expenses

     Research and development expenses increased from $17.0 million in fiscal
1999 to $33.0 million in fiscal 2000, an increase of $16.0 million. The increase
was primarily due to nonrecurring engineering and initial product verification
expenses and increased salaries and related personnel expenses due to the hiring
of additional engineers. For fiscal 1999 and fiscal 2000, research and
development expenses decreased as a percentage of net revenue from 17.4% to
12.6%. This percentage decrease was primarily the result of an increase in our
net revenue.

                                       19
<PAGE>

     Research and development expenses increased from $10.7 million in fiscal
1998 to $17.0 million in fiscal 1999, an increase of $6.3 million. The increase
was primarily due to nonrecurring engineering and initial product verification
expenses, the hiring of additional engineers and an increase in depreciation
charges due to increases in capital spending on design and simulation software
and test equipment. For fiscal 1998 and fiscal 1999, research and development
expenses decreased as a percentage of net revenue from 45.2% to 17.4%. This
percentage decrease was primarily the result of an increase in our net revenue.

Sales and Marketing Expenses

     Sales and marketing expenses increased from $27.1 million in fiscal 1999 to
$67.1 million in fiscal 2000, an increase of $40.0 million. This increase was
primarily due to the hiring of additional sales, marketing and customer support
personnel, increased sales commission expenses resulting from increased
revenues, increased tradeshow and promotional expenses and the establishment of
new sales offices. For fiscal 1999 and fiscal 2000, sales and marketing expenses
decreased as a percentage of net revenue from 27.6% to 25.6%. This percentage
decrease was primarily the result of an increase in our net revenue.

     We intend to pursue sales and marketing campaigns aggressively and
therefore expect these expenses to increase significantly in absolute dollars in
the future. In addition, we recently hired approximately 200 sales and marketing
personnel. We expect to continue to expand our field sales operations to support
and develop leads for our resellers and distributors, which will also result in
an increase in sales and marketing expenses.

     Sales and marketing expenses increased from $9.6 million in fiscal 1998 to
$27.1 million in fiscal 1999, an increase of $17.5 million. This increase was
primarily due to the hiring of additional sales and customer support personnel,
tradeshow and promotional expenses, increased commission expenses resulting from
higher sales, and the establishment of new sales offices. For fiscal 1998 and
fiscal 1999, sales and marketing expenses decreased as a percentage of net
revenue from 40.7% to 27.6%. This percentage decrease was primarily the result
of an increase in our net revenue.

General and Administrative Expenses

     General and administrative expenses increased from $6.9 million in fiscal
1999 to $11.9 million in fiscal 2000, an increase of $5.0 million. This increase
was due primarily to the hiring of additional finance, information technology,
legal and administrative personnel and increased professional fees and occupancy
costs. For fiscal 1999 and fiscal 2000, general and administrative expenses
decreased as a percentage of net revenue from 7.0% to 4.5%. This percentage
decrease was primarily the result of an increase in our net revenue.

     General and administrative expenses increased from $2.4 million in fiscal
1998 to $6.9 million in fiscal 1999, an increase of $4.5 million. This increase
was due primarily to the hiring of additional finance, information technology
and legal and administrative personnel, recruiting expenses, professional fees
and increased spending on information systems. For fiscal 1998 and fiscal 1999,
general and administrative expenses decreased as a percentage of net revenue
from 10.4% to 7.0%. This percentage decrease was primarily the result of an
increase in our net revenue.

Amortization of Goodwill and Purchased Intangibles

     Amortization of goodwill and purchased intangibles was $7.1 million in
fiscal 2000. This amount was due to the Company's issuance of fully earned,
non-forfeitable, fully exercisable warrants with a two year life to purchase 3
million shares of the Company's common stock with an exercise price of $39.50
per share as discussed in Note 3 of notes to consolidated financial statements.
Future operating income will be reduced by approximately $7.1 million per
quarter for each quarter in fiscal 2001 and for three fiscal quarters in fiscal
2002.

Interest Income

     Interest income increased from $1.9 million in fiscal 1999 to $14.6
million in fiscal 2000, an increase of $12.7 million. The increase is due to the
increased amount of cash and cash equivalents, short-term investments,
restricted investments and long-term investments from the proceeds we received
from our initial public offering in April 1999 and our secondary public offering
in October 1999.

     Interest income increased from $.6 million in fiscal 1998 to $1.9 million
in fiscal 1999, an increase of $1.3 million. The increase

                                       20
<PAGE>

is due to the increased amount of cash and cash equivalents, short-term
investments and long-term investments from the proceeds we received from our
initial public offering in April 1999.

Income Taxes

     We recorded a tax provision of $10.3 million for the year ended June 30,
2000. The provision for fiscal 2000 results in an effective tax rate of 34%
which consists primarily of federal taxes, state income taxes and foreign taxes,
offset by the recognition of deferred tax assets. FASB Statement No. 109
provides for the recognition of deferred tax assets if realization of such
assets is more likely than not. We intend to evaluate the realizability of the
deferred tax assets on a quarterly basis. We incurred significant operating
losses for all fiscal years from inception through June 30, 1999. We recorded a
tax provision of $1.7 million for the year ended June 30, 1999, which consisted
primarily of foreign taxes, federal taxes and state income taxes.

Liquidity and Capital Resources

     Cash and cash equivalents and short-term investments increased from $123.6
million at June 30, 1999 to $183.4 million at June 30, 2000, an increase of
$59.8 million. The increase is primarily a result of our secondary public
offering of common stock in October 1999, which generated net proceeds of $174.0
million, primarily offset by an increase in long-term investments and restricted
investments of $108.0 million. Cash provided by operating activities was $24.8
million in fiscal 2000, as compared to cash provided by operating activities of
$2.8 million in fiscal 1999. The increase was primarily due to net income,
depreciation, amortization and increases in accounts payable, deferred revenue
and accrued liabilities, offset by increases in accounts receivable, inventories
and other current and noncurrent assets. We expect that accounts receivable will
continue to increase to the extent our revenues continue to rise. We expect our
inventory levels to increase in connection with our development of a two-tier
distribution system, new product introductions and the need to maintain shorter
lead times on certain products. Any such increase can be expected to reduce
cash, cash equivalents, short-term investments and long-term investments.

     Investing activities used cash of $195.0 million in fiscal 2000 due to
capital expenditures of $27.2 million, net purchases of investments of $158.8
million and minority investments of $9.0 million. Our investing activities used
cash of $29.1 million in fiscal 1999 for net purchases of investments of $21.6
million and capital expenditures of $7.5 million. Our investing activities used
cash of $13.5 million in fiscal 1998 for capital expenditures of $2.5 million
and net purchases of investments of $11.0 million. We expect capital
expenditures of approximately $30.0 million in fiscal 2001. Under the terms of a
certain equity investment, upon the attainment of certain technological
milestones, we will be obligated to purchase all of the outstanding capital
stock in fiscal 2001, payable in any combination of cash or shares of Extreme
common stock.

     Financing activities provided cash of $179.7 million in fiscal 2000,
arising primarily from proceeds from the issuance of common stock in conjunction
with our secondary public offering, partially offset by payments of capital
lease obligations. Financing activities provided cash of $124.0 million in
fiscal 1999, arising primarily from proceeds from the issuance of common stock
in conjunction with our initial public offering, partially offset by principal
payments on notes payable and capital lease obligations. Financing activities
provided cash of $21.2 million in fiscal 1998, primarily from the issuance of
convertible preferred stock and proceeds from notes payable, partially offset by
principal payments on notes payable and capital lease obligations.

     In June 2000, we entered into an operating lease agreement to lease 275,000
square feet to house our primary facility in Santa Clara, California. Our lease
payments will vary based on the LIBOR plus a spread which was 7.14% at June 30,
2000. Our lease payments are estimated to be approximately $5.7 million on an
annual basis over the lease term. The lease is for five years and can be renewed
for two five-year periods, subject to the approval of the lessor. At the
expiration or termination of the lease, we have the option to either purchase
the property for $80.0 million, or arrange for the sale of the property to a
third party for at least $80.0 million with a contingent liability for any
deficiency. If the property is not purchased or sold as described above, we will
be obligated for an additional lease payment of approximately $68.0 million.

     As part of the above lease transaction, the Company restricted $80.0
million of its investment securities as collateral for specified obligations of
the lessee under the lease. These investment securities are restricted as to
withdrawal and are managed by a third party subject to certain limitations under
the Company's investment policy. The lease also requires us to maintain
specified financial covenants with which we were in compliance as of June 30,
2000.

     We require substantial capital to fund our business, particularly to
finance inventories and accounts receivable and for capital expenditures. As a
result, we could be required to raise substantial additional capital. To the
extent that we raise additional capital

                                       21
<PAGE>

through the sale of equity or convertible debt securities, the issuance of such
securities could result in dilution to existing stockholders. If additional
funds are raised through the issuance of debt securities, these securities may
have rights, preferences and privileges senior to holders of common stock and
the terms of such debt could impose restrictions on our operations. We cannot
assure you that such additional capital, if required, will be available on
acceptable terms, or at all. If we are unable to obtain such additional capital,
we may be required to reduce the scope of our planned product development and
marketing efforts, which would materially adversely affect our business,
financial condition and operating results.

     We believe that our current cash and cash equivalents, short-term
investments, long-term investments and cash available from credit facilities and
future operations will enable us to meet our working capital requirements for at
least the next 12 months.

New Accounting Pronouncements

     In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities" ("FAS 133"). FAS 133 establishes methods of
accounting for derivative financial instruments and hedging activities related
to those instruments as well as other hedging activities. In June 1999, the FASB
issued SFAS No. 137, "Accounting for Derivative Instruments and Hedging
Activities - Deferral of the Effective Date of FASB Statement No. 133", which
extended the deferral of the application of FAS 133 to all fiscal quarters of
fiscal years beginning after June 15, 2000. In June 15, 2000 the FASB also
issued FAS 138, "Accounting for Certain Derivative Instruments and Certain
Hedging Activities) an Amendment to FASB Statement No. 133". FAS 138 amends the
accounting and reporting standards of Statement 133 for certain derivative
instruments and certain hedging activities. The Company will be required to
adopt these pronouncements for the year ending June 30, 2001. Because the
Company currently holds no derivative financial instruments and does not
currently engage in hedging activities, adoption of FAS 133 and 138 are expected
to have no material impact on the Company's financial condition or results of
operations.

     In December 1999, the Staff of the Securities and Exchange Commission
("SEC") issued Staff Accounting Bulletin ("SAB") No. 101. "Revenue Recognition
in Financial Statements", which provides guidance on the recognition,
presentation and disclosure of revenue in financial statements. The
implementation of SAB 101 has recently been deferred to no later than the fourth
fiscal quarter of fiscal years beginning after December 15, 1999. The Company is
presently evaluating the potential impact of the adoption of SAB 101.

     In March 2000, the FASB issued Financial Accounting Standards Board
Interpretation No. 44, "Accounting for Certain Transactions involving Stock
Compensation - an interpretation of APB Opinion No. 25" (Interpretation No. 44).
Interpretation No. 44 is effective July 1, 2000. The interpretation clarifies
the application of APB Opinion No. 25 for certain issues, specifically, (a) the
definition of an employee, (b) the criteria for determining whether a plan
qualifies as a noncompensatory plan, (c) the accounting consequence of various
modifications to the terms of a previously fixed stock option or award, and (d)
the accounting for an exchange or stock compensation awards in a business
combination. We do not anticipate that the adoption of Interpretation No. 44
will have a material impact on our financial position or the results of our
operations.


Factors That May Affect Our Results

Extreme Has a Limited History of Profitability and Cannot Assure You that it
Will Continue to Achieve Profitability

      Although our revenue has grown in recent quarters, we cannot be certain
that we will realize sufficient revenue to achieve continued profitability on a
fiscal year basis. Fiscal 2000 was the first year in which Extreme achieved
profitability in each of the four quarters. We anticipate continuing to incur
significant sales and marketing, product development and general and
administrative expenses and, as a result, we will need to generate significantly
higher revenue to sustain profitability. In particular, our recent hiring of
approximately 200 sales and marketing personnel has substantially increased
expenses. We expect that the hiring of such personnel will allow us to increase
sales, however, we can not assure you that this will occur and we cannot assure
you that operating margins will not be adversely affected by this or other
hiring. In addition, the amortization of purchased intangibles and goodwill is
estimated to be approximately $27.7 million and $21.0 million in fiscal 2001 and
2002, respectively.

A Number of Factors Could Cause Extreme's Quarterly Financial Results to Be
Worse Than Expected, Resulting in a Decline in Its Stock Price

     We plan to significantly increase our operating expenses to expand our
sales and marketing activities, broaden our customer

                                       22
<PAGE>

support capabilities, develop new distribution channels, fund increased levels
of research and development and build our operational infrastructure. We base
our operating expenses on anticipated revenue trends and a high percentage of
our expenses are fixed in the short term. As a result, any delay in generating
or recognizing revenue could cause our quarterly operating results to be below
the expectations of public market analysts or investors, which could cause the
price of our common stock to fall.

     We may experience a delay in generating or recognizing revenue because of a
number of reasons. Orders at the beginning of each quarter typically do not
equal expected revenue for that quarter and are generally cancelable at any
time. Accordingly, we are dependent upon obtaining orders in a quarter for
shipment in that quarter to achieve our revenue objectives. In addition, the
timing of product releases, purchase orders and product availability could
result in significant product shipments at the end of a quarter. Failure to ship
these products by the end of a quarter may adversely affect our operating
results. Furthermore, our customer agreements typically provide that the
customer may delay scheduled delivery dates and cancel orders within specified
time frames without significant penalty.

     Our quarterly revenue and operating results have varied significantly in
the past and may vary significantly in the future due to a number of factors,
including:

 .    fluctuations in demand for our products and services, including
     seasonality, particularly in Asia and Europe;

 .    unexpected product returns or the cancellation or rescheduling of
     significant orders;

 .    our ability to develop, introduce, ship and support new products and
     product enhancements and manage product transitions;

 .    announcements and new product introductions by our competitors; . our
     ability to develop and support customer relationships with service
     providers and other potential large customers;

 .    our ability to achieve required cost reductions;

 .    our ability to obtain sufficient supplies of sole or limited sourced
     components for our products;

 .    unfavorable changes in the prices of the components we purchase;

 .    our ability to attain and maintain production volumes and quality levels
     for our products;

 .    the mix of products sold and the mix of distribution channels through
     which they are sold; and

 .    costs relating to possible acquisitions and integration of technologies
     or businesses.

 .    the affect of amortization of goodwill and purchased intangibles
     resulting from existing or new transactions.

     Due to the foregoing factors, we believe that period-to-period comparisons
of our operating results should not be relied upon as an indicator of our future
performance.

Intense Competition in the Market for Networking Equipment Could Prevent Extreme
From Increasing Revenue and Prevent Extreme From Sustaining Profitability

     The market for Internet switches is intensely competitive. Our principal
competitors include Cabletron Systems, Cisco Systems, Foundry Networks, Lucent
Technologies and Nortel Networks. Many of our current and potential competitors
have longer operating histories and substantially greater financial, technical,
sales, marketing and other resources, as well as greater name recognition and
larger installed customer bases, than we do. These competitors may have
developed, or could in the future, develop new technologies that compete with
our products or even render our products obsolete.

     To remain competitive, we believe we must, among other things, invest
significant resources in developing new products and enhancing our current
products and maintaining customer satisfaction. If we fail to do so, our
products may not compete favorably with those of our competitors and our revenue
and future profitability could be materially adversely affected.

Extreme Expects the Average Selling Prices of Its Products to Decrease Rapidly
Which May Reduce Gross Margins or Revenue

     The network equipment industry has experienced rapid erosion of average
selling prices due to a number of factors, including competitive pricing
pressures and rapid technological change. We may experience substantial
period-to-period fluctuations in future

                                       23
<PAGE>

operating results due to the erosion of our average selling prices. We
anticipate that the average selling prices of our products will decrease in the
future in response to competitive pricing pressures, increased sales discounts,
new product introductions by us or our competitors, including, for example,
competitive products manufactured with low cost merchant silicon, or other
factors. Therefore, to maintain our gross margins, we must develop and introduce
on a timely basis new products and product enhancements and continually reduce
our product costs. Our failure to do so would cause our revenue and gross
margins to decline, which could materially adversely affect our operating
results and cause the price of our common stock to decline.

Extreme's Market is Subject to Rapid Technological Change and to Compete,
Extreme Must Continually Introduce New Products that Achieve Broad Market
Acceptance

     The network equipment market is characterized by rapid technological
change, frequent new product introductions, changes in customer requirements and
evolving industry standards. If we do not address these changes by regularly
introducing new products, our product line will become obsolete. Developments in
routers and routing software could also significantly reduce demand for our
product. Alternative technologies could achieve widespread market acceptance and
displace Ethernet technology on which our product lines and architecture are
based. We cannot assure you that our technological approach will achieve broad
market acceptance or that other technologies or devices will not supplant our
approach.

     When we announce new products or product enhancements that have the
potential to replace or shorten the life cycle of our existing products,
customers may defer purchasing our existing products. These actions could
materially adversely affect our operating results by unexpectedly decreasing
sales, increasing our inventory levels of older products and exposing us to
greater risk of product obsolescence. The market for switching products is
evolving and we believe our ability to compete successfully in this market is
dependent upon the continued compatibility and interoperability of our products
with products and architectures offered by other vendors. In particular, the
networking industry has been characterized by the successive introduction of new
technologies or standards that have dramatically reduced the price and increased
the performance of switching equipment. To remain competitive we need to
introduce products in a timely manner that incorporate or are compatible with
these new technologies as they emerge. For example, this fiscal year we
introduced a new generation chipset which was incorporated in a new product
family which began shipping in the quarter ended March 31, 2000. We cannot
assure you that these new products will be commercially successful. We have
experienced delays in releasing new products and product enhancements in the
past which delayed sales and resulted in lower quarterly revenue than
anticipated. We may experience similar delays in product development and release
in the future and any delay in product introduction could adversely affect our
ability to compete and cause our operating results to be below our expectations
or the expectations of public market analysts or investors.

Continued Rapid Growth Will Strain Extreme's Operations and Will Require Extreme
to Incur Costs to Upgrade Its Infrastructure

     We have experienced a period of rapid growth and expansion which has
placed, and continues to place, a significant strain on our resources. Even if
we manage this growth effectively, we may make mistakes in operating our
business such as inaccurate sales forecasting, incorrect material planning or
inaccurate financial reporting, which may result in unanticipated fluctuations
in our operating results. Our net revenue increased significantly during the
last fiscal year, and from June 30, 1999 to June 30, 2000, the number of our
employees increased from 249 to 680. We expect our anticipated growth and
expansion to strain our management, operational and financial resources. Our
management team has had limited experience managing such rapidly growing
companies on a public or private basis. To accommodate this anticipated growth,
we will be required to:

 . improve existing and implement new operational, information and financial
  systems, procedures and controls;

 . hire, train and manage additional qualified personnel, including sales,
  marketing personnel and research and development personnel; and

 . effectively manage multiple relationships with our customers, suppliers and
  other third parties.

     We may not be able to install adequate control systems in an efficient and
timely manner, and our current or planned personnel systems, procedures and
controls may not be adequate to support our future operations. In August 1998,
we installed a new management information system, which we may continue to
modify and improve to meet the increasing needs associated with our growth. The
difficulties associated with installing and implementing these new systems,
procedures and controls may place a significant burden on our management and our
internal resources. In addition, as we grow internationally, we will have to
expand our

                                       24
<PAGE>

worldwide operations and enhance our communications infrastructure. Any delay in
the implementation of such new or enhanced systems, procedures or controls, or
any disruption in the transition to such new or enhanced systems, procedures or
controls, could adversely affect our ability to accurately forecast sales
demand, manage our supply chain and record and report financial and management
information on a timely and accurate basis.

Extreme Must Develop and Expand Its Indirect Distribution Channels to Increase
Revenues and Improve Its Operating Results

     Our distribution strategy focuses primarily on developing and expanding
indirect distribution channels through resellers, distributors and, to a lesser
extent, original equipment manufacturers, or OEMs, as well as expanding our
field sales organization. If we fail to develop and cultivate relationships with
significant resellers, or if these resellers are not successful in their sales
efforts, sales of our products may decrease and our operating results would
suffer. Many of our resellers also sell products that compete with our products.
We are developing a two-tier distribution structure in Europe and the United
States which has and will require us to enter into agreements with a small
number of stocking distributors. We have entered into two-tier distribution
agreements; however, we cannot assure you that we will continue to be able to
enter into additional distribution agreements or that we will be able to
successfully manage the transition of resellers to a two-tier distribution
channel. Our failure to do so could limit our ability to grow or sustain
revenue. In addition, our operating results will likely fluctuate significantly
depending on the timing and amount of orders from our resellers. We cannot
assure you that our resellers will market our products effectively or continue
to devote the resources necessary to provide us with effective sales, marketing
and technical support.

     To support and develop leads for our indirect distribution channels and to
expand our direct sales effort, to service providers and content providers, we
plan to continue to expand our field sales and support staff significantly. We
cannot assure you that this internal expansion will be successfully completed,
that the cost of this expansion will not exceed the revenues generated or that
our expanded sales and support staff will be able to compete successfully
against the significantly more extensive and well-funded sales and marketing
operations of many of our current or potential competitors. Our inability to
effectively establish our distribution channels or manage the expansion of our
sales and support staff would materially adversely affect our ability to grow
and increase revenue.

Because Substantially All of Extreme's Revenue is Derived From Sales of Two
Product Families, Extreme is Dependent on Widespread Market Acceptance of These
Products; Future Performance will Depend on the Introduction and Acceptance of
New Products

     In fiscal 2000, we derived substantially all of our revenue from sales of
our Summit and BlackDiamond product families. We expect that revenue from these
product families will account for a substantial portion of our revenue for the
foreseeable future. Accordingly, widespread market acceptance of our product
families is critical to our future success. Factors that may affect the market
acceptance of our products include market acceptance of switching products, and
Gigabit Ethernet and Layer 3 switching technologies in particular in the
enterprise, service provider and metropolitan area network markets, the
performance, price and total cost of ownership of our products, the availability
and price of competing products and technologies, and the success and
development of our resellers, distributors, OEMs and field sales channels. Many
of these factors are beyond our control. Our future performance will also depend
on the successful development, introduction and market acceptance of new and
enhanced products that address customer requirements in a cost-effective manner.
We have in the past experienced delays in product development and such delays
may occur in the future. We introduced a new product family in fiscal 2000 which
is based on a new generation chip set. In addition, we also introduced new
products within our existing product lines that incorporate this new chip set.
The introduction of new and enhanced products may cause our customers to defer
or cancel orders for existing products. Therefore, to the extent customers defer
or cancel orders in the expectation of any new product release, any delay in
development or introduction could cause our operating results to suffer. Failure
of our existing or future products to maintain and achieve widespread levels of
market acceptance may significantly impair our revenue growth.

If a Key Reseller, Distributor, OEM or Other Significant Customer Cancels or
Delays a Large Purchase, Extreme's Revenues May Decline and the Price of Its
Stock May Fall

     To date, a limited number of resellers, distributors, OEMs and other
customers have accounted for a significant portion of our revenue. If any of our
large customers stop or delay purchases, our revenue and profitability would be
adversely affected. For example, in fiscal 1999, Compaq and Hitachi Cable
accounted for 21% and 13% of our net revenue, respectively. Because our expense
levels are based on our expectations as to future revenue and to a large extent
are fixed in the short term, a substantial reduction or delay in sales of our
products to, or the loss of any significant reseller, distributor, OEM or other
customer, or unexpected returns from

                                       25
<PAGE>

resellers could harm our business, operating results and financial condition.
Although our largest customers may vary from period-to-period, we anticipate
that our operating results for any given period will continue to depend to a
significant extent on large orders from a small number of customers,
particularly in light of the high sales price per unit of our products and the
length of our sales cycles.

     While our financial performance depends on large orders from a few key
resellers, distributors, OEMs and other significant customers, we do not have
binding commitments from any of them. For example:

 .    our service provider and enterprise network customers can stop purchasing
     and our resellers, distributors and OEMs can stop marketing our products
     at any time;

 .    our reseller agreements generally are not exclusive and are for one year
     terms, with no obligation of the resellers to renew the agreements;

 .    our reseller agreements provide for discounts based on expected or actual
     volumes of products purchased or resold by the reseller in a given
     period; and

 .    our reseller, distributor and OEM agreements generally do not require
     minimum purchases.

     We have established a program which, under specified conditions, enables
some third party resellers to return products to us. The amount of potential
product returns is estimated and provided for in the period of the sale. Some of
our OEM agreements also provide manufacturing rights and access to our source
code upon the occurrence of specified conditions of default. If we were to
default on these agreements, our OEMs could use our source code to develop and
manufacture competing products, which would negatively affect our performance
and ability to compete.

The Sales Cycle for Extreme's Products is Long and Extreme May Incur Substantial
Non-Recoverable Expenses or Devote Significant Resources to Sales that Do Not
Occur When Anticipated

     The timing of our sales revenue is difficult to predict because of our
reliance on indirect sales channels and the length and variability of our sales
cycle. Our products have a relatively high sales price per unit, and often
represent a significant and strategic decision by an enterprise regarding its
communications infrastructure. Accordingly, the purchase of our products
typically involves significant internal procedures associated with the
evaluation, testing, implementation and acceptance of new technologies. This
evaluation process frequently results in a lengthy sales process, typically
ranging from three months to longer than a year, and subjects the sales cycle
associated with the purchase of our products to a number of significant risks,
including budgetary constraints and internal acceptance reviews. The length of
our sales cycle also may vary substantially from customer to customer. While our
customers are evaluating our products and before they may place an order with
us, we may incur substantial sales and marketing expenses and expend significant
management effort. Consequently, if sales forecasted from a specific customer
for a particular quarter are not realized in that quarter, we may be unable to
compensate for the shortfall, which could harm our operating results.

Extreme Purchases Several Key Components for Products From Single or Limited
Sources and Could Lose Sales if These Sources Fail to Fill Its Needs

     We currently purchase several key components used in the manufacture of our
products from single or limited sources and are dependent upon supply from these
sources to meet our needs. Certain components such as tantalum capacitors, SRAM
and printed circuit boards have been and may in the future be in short supply.
While we have been able to meet our needs to date, we have in the past and are
likely in the future to encounter shortages and delays in obtaining these or
other components and this could materially adversely affect our ability to meet
customer orders. Our principal sole sourced components include:

 .    ASICs;

 .    microprocessors;

 .    programmable integrated circuits;

 .    selected other integrated circuits;

 .    cables; and

 .    custom-tooled sheet metal.

                                       26
<PAGE>

     Our principal limited sourced components include:

 .    flash memories;

 .    dynamic and static random access memories, commonly known as DRAMs and
     SRAMs, respectively; and

 .    printed circuit boards.

     We use a rolling six-month forecast based on anticipated product orders to
determine our material requirements. Lead times for materials and components we
order vary significantly, and depend on factors such as the specific supplier,
contract terms and demand for a component at a given time. If orders do not
match forecasts, we may have excess or inadequate inventory of certain materials
and components, which could materially adversely affect our operating results
and financial condition. From time to time we have experienced shortages and
allocations of certain components, resulting in delays in filling orders. In
addition, during the development of our products we have experienced delays in
the prototyping of our ASICs, which in turn has led to delays in product
introductions.

Extreme Needs to Expand Its Manufacturing Operations and Depends on Contract
Manufacturers for Substantially All of Its Manufacturing Requirements

     If the demand for our products continues to grow, we will need to increase
our material purchases, contract manufacturing capacity and internal test and
quality functions. Any disruptions in product flow could limit our revenue,
adversely affect our competitive position and reputation and result in
additional costs or cancellation of orders under agreements with our customers.

     We rely on third party manufacturing vendors to manufacture our products.
We currently subcontract substantially all of our manufacturing to three
companies--Flextronics International, Ltd., located in San Jose, California,
MCMS, Inc., located in Boise, Idaho and Solectron, located in Milpitas,
California. We have experienced a delay in product shipments from contract
manufacturers in the past, which in turn delayed product shipments to our
customers. We may in the future experience similar or other problems, such as
inferior quality and insufficient quantity of product, any of which could
materially adversely affect our business and operating results. There can be no
assurance that we will effectively manage our contract manufacturers or that
these manufacturers will meet our future requirements for timely delivery of
products of sufficient quality and quantity. We intend to regularly introduce
new products and product enhancements, which will require that we rapidly
achieve volume production by coordinating our efforts with those of our
suppliers and contract manufacturers. The inability of our contract
manufacturers to provide us with adequate supplies of high-quality products or
the loss of either of our contract manufacturers would cause a delay in our
ability to fulfill orders while we obtain a replacement manufacturer and would
have a material adverse effect on our business, operating results and financial
condition.

     As part of our cost-reduction efforts, we will need to realize lower per
unit product costs from our contract manufacturers as a result of volume
efficiencies. However, we cannot be certain when or if such price reductions
will occur. The failure to obtain such price reductions would adversely affect
our gross margins and operating results.

If Extreme Loses Key Personnel or is Unable to Hire Additional Qualified
Personnel as Necessary, It May Not Be Able to Successfully Manage Its Business
or Achieve Its Objectives

     Our success depends to a significant degree upon the continued
contributions of our key management, engineering, sales and marketing and
manufacturing personnel, many of whom would be difficult to replace. In
particular, we believe that our future success is highly dependent on Gordon
Stitt, Chairman, President and Chief Executive Officer, Stephen Haddock, Vice
President and Chief Technical Officer, and Herb Schneider, Vice President of
Engineering. We neither have employment contracts with nor key person life
insurance on any of our key personnel.

     We believe our future success will also depend in large part upon our
ability to attract and retain highly skilled managerial, engineering, sales and
marketing, finance and manufacturing personnel. Competition for these personnel
is intense, especially in the San Francisco Bay Area, and we have had difficulty
hiring employees in the timeframe we desire, particularly software engineers.
There can be no assurance that we will be successful in attracting and retaining
such personnel. The loss of the services of any of our key personnel, the
inability to attract or retain qualified personnel in the future or delays in
hiring required personnel, particularly engineers and sales personnel, could
make it difficult for us to manage our business and meet key objectives, such as
product introductions, on time. In addition, companies in the networking
industry whose employees accept positions with competitors frequently claim that
competitors have engaged in unfair hiring practices. We have from time to time
received claims like this from

                                       27
<PAGE>

other companies and, although to date they have not resulted in material
litigation, we cannot assure you that we will not receive additional claims in
the future as we seek to hire qualified personnel or that such claims will not
result in material litigation. We could incur substantial costs in defending
ourselves against any such claims, regardless of the merits of such claims.

Extreme's Products Must Comply With Evolving Industry Standards and Complex
Government Regulations or Its Products May Not Be Widely Accepted, Which May
Prevent Extreme From Sustaining Its Revenues or Achieving Profitability

     The market for network equipment products is characterized by the need to
support industry standards as different standards emerge, evolve and achieve
acceptance. We will not be competitive unless we continually introduce new
products and product enhancements that meet these emerging standards. In the
past, we have introduced new products that were not compatible with certain
technological changes, and in the future we may not be able to effectively
address the compatibility and interoperability issues that arise as a result of
technological changes and evolving industry standards. In addition, in the
United States, our products must comply with various regulations and standards
defined by the Federal Communications Commission and Underwriters Laboratories.
Internationally, products that we develop may be required to comply with
standards established by telecommunications authorities in various countries as
well as with recommendations of the International Telecommunication Union. If we
do not comply with existing or evolving industry standards or if we fail to
obtain timely domestic or foreign regulatory approvals or certificates we would
not be able to sell our products where these standards or regulations apply,
which may prevent us from sustaining our revenues or achieving profitability.

Failure to Successfully Integrate Extreme's Expanded Sales and Support
Organizations into Its Operation or Educate Them About Its Product Families Will
Hurt Its Operating Results.

     Our products and services require a sophisticated sales effort targeted at
several levels within a prospective customer's organization. Unless we expand
our sales force we will not be able to increase revenues. In April 2000, a
significant number of former sales and system engineer employees of another
networking company joined our operation. We cannot assure you that we will be
able to educate these new employees about our product families or integrate
these new employees into our company. A failure to do so will hurt our revenue
growth and may hurt our operating results.

Extreme Depends Upon International Sales for Much of Its Revenue and Extreme's
Ability to Sustain and Increase Its International Sales Depends on Successfully
Expanding Its International Operations

     Our ability to grow will depend in part on the expansion of international
sales and operations which have and are expected to constitute a significant
portion of our sales. Sales to customers outside of North America accounted for
approximately 53% and 45% of our net revenue in fiscal 1999 and fiscal 2000,
respectively. Our international sales primarily depend on our resellers,
distributors and OEMs. The failure of our resellers, distributors and OEMs to
sell our products internationally would limit our ability to sustain and grow
our revenue. In addition, there are a number of risks arising from our
international business, including:

 .    longer accounts receivable collection cycles;

 .    difficulties in managing operations across disparate geographic areas;

 .    difficulties associated with enforcing agreements through foreign legal
     systems;

 .    payment of operating expenses in local currencies, which subjects us to
     risks of currency fluctuations;

 .    import or export licensing requirements;

 .    potential adverse tax consequences; and

 .    unexpected changes in regulatory requirements.

     Our international sales currently are U.S. dollar-denominated. As a result,
an increase in the value of the U.S. dollar relative to foreign currencies could
make our products less competitive in international markets. In the future, we
may elect to invoice some of our international customers in local currency which
will subject us to fluctuations in exchange rates between the U.S. dollar and
the particular local currency. If we do so, we may determine to engage in
hedging transactions to minimize the risk of such fluctuations. However, if we
are not successful in managing such hedging transactions, we could incur losses
from hedging activities. Because we currently denominate sales in U.S. dollars,
we do not anticipate that the adoption of the Euro as a functional legal
currency of certain European countries will materially affect our business.

                                       28
<PAGE>

Extreme May Engage in Future Acquisitions that Dilute the Ownership Interests of
Our Stockholders, Cause Us to Incur Debt and Assume Contingent Liabilities

     As part of our business strategy, we review acquisition and strategic
investment prospects that would complement our current product offerings,
augment our market coverage or enhance our technical capabilities, or that may
otherwise offer growth opportunities. We are reviewing investments in new
businesses and we expect to make investments in and acquire businesses, products
or technologies in the future. In the event of any future acquisitions, we
could:


 .    issue equity securities which would dilute current stockholders'
     percentage ownership;

 .    incur substantial debt

 .    assume contingent liabilities; or

 .    expend significant cash.

     These actions by us could materially adversely affect our operating results
and/or the price of our common stock. Acquisitions and investment activities
also entail numerous risks, including:

 .    difficulties in the assimilation of acquired operations, technologies or
     products;

 .    unanticipated costs associated with the acquisition or investment
     transaction;

 .    diversion of management's attention from other business concerns;

 .    adverse effects on existing business relationships with suppliers and
     customers;

 .    risks associated with entering markets in which we have no or limited
     prior experience

 .    potential loss of key employees of acquired organizations; and

 .    substantial charges for amortization of goodwill or purchased intangibles
     or similar items.

     We cannot assure you that we will be able to successfully integrate any
businesses, products, technologies or personnel that we might acquire in the
future, and our failure to do so could materially adversely affect our business,
operating results and financial condition.

Extreme May Need Additional Capital to Fund Its Future Operations And, If It Is
Not Available When Needed, Extreme May Need to Reduce Its Planned Development
and Marketing Efforts, Which May Reduce Its Revenues and Prevent Extreme From
Achieving Profitability

     We believe that our existing working capital, proceeds from the initial
public offering in April 1999, proceeds from the secondary offering in October
1999 and cash available from credit facilities and future operations will enable
us to meet our working capital requirements for at least the next 12 months.
However, if cash from future operations is insufficient, or if cash is used for
acquisitions or other currently unanticipated uses, we may need additional
capital. The development and marketing of new products and the expansion of
reseller and distribution channels and associated support personnel is expected
to require a significant commitment of resources. In addition, if the market for
our products were to develop more slowly than anticipated or if we fail to
establish significant market share and achieve a meaningful level of revenues,
we may continue to utilize significant amounts of capital. As a result, we could
be required to raise substantial additional capital. To the extent that we raise
additional capital through the sale of equity or convertible debt securities,
the issuance of such securities could result in dilution to existing
stockholders. If additional funds are raised through the issuance of debt
securities, such securities may have rights, preferences and privileges senior
to holders of common stock and the term of such debt could impose restrictions
on our operations. We cannot assure you that such additional capital, if
required, will be available on acceptable terms, or at all. If we are unable to
obtain such additional capital, we may be required to reduce the scope of our
planned product development and marketing efforts, which would harm our
business, financial condition and operating results.

                                       29
<PAGE>

If Extreme's Products Contain Undetected Software or Hardware Errors, Extreme
Could Incur Significant Unexpected Expenses and Lost Sales

     Network products frequently contain undetected software or hardware errors
when first introduced or as new versions are released. We have experienced such
errors in the past in connection with new products and product upgrades. We
expect that such errors will be found from time to time in new or enhanced
products after commencement of commercial shipments. These problems may
materially adversely affect our business by causing us to incur significant
warranty and repair costs, diverting the attention of our engineering personnel
from our product development efforts and causing significant customer relations
problems.

     Our products must successfully interoperate with products from other
vendors. As a result, when problems occur in a network, it may be difficult to
identify the source of the problem. The occurrence of hardware and software
errors, whether caused by our products or another vendor's products, could
result in the delay or loss of market acceptance of our products and any
necessary revisions may result in the incurrence of significant expenses. The
occurrence of any such problems would likely have a material adverse effect on
our business, operating results and financial condition.

Extreme's Limited Ability to Protect Its Intellectual Property May Adversely
Affect Its Ability to Compete

     We rely on a combination of patent, copyright, trademark and trade secret
laws and restrictions on disclosure to protect our intellectual property rights.
However, we cannot assure you that the actions we have taken will adequately
protect our intellectual property rights.

     We also enter into confidentiality or license agreements with our
employees, consultants and corporate partners, and control access to and
distribution of our software, documentation and other proprietary information.
Despite our efforts to protect our proprietary rights, unauthorized parties may
attempt to copy or otherwise obtain and use our products or technology.

Provisions in Extreme's Charter or Agreements May Delay or Prevent a Change of
Control

     Provisions in our certificate of incorporation and bylaws may delay or
prevent a change of control or changes in our management. These provisions
include:

 .    the division of the board of directors into three separate classes;

 .    the right of the board of directors to elect a director to fill a vacancy
     created by the expansion of the board of directors; and

 .    the ability of the board of directors to alter our bylaws without getting
     stockholder approval

     Furthermore, we are subject to the provisions of section 203 of the
Delaware General Corporation Law. These provisions prohibit large stockholders,
in particular those owning 15% or more of the outstanding voting stock, from
consummating a merger or combination with a corporation unless this stockholder
receives board approval for the transaction or 66 2/3% of the shares of voting
stock not owned by the stockholder approve the merger or combination.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Sensitivity

    The primary objective of our investment activities is to preserve principal
while at the same time maximizing the income we receive from our investments
without significantly increasing risk. Some of the securities that we have
invested in may be subject to market risk. This means that a change in
prevailing interest rates may cause the principal amount of the investment to
fluctuate. For example, if we hold a security that was issued with a fixed
interest rate at the then-prevailing rate and the prevailing interest rate later
rises, the principal amount of our investment will probably decline. To minimize
this risk, we maintain our portfolio of cash equivalents and short-term
investments in a variety of securities, including commercial paper, other
non-government debt securities and money market funds. In general, money market
funds are not subject to market risk because the interest paid on such funds
fluctuates with the prevailing interest rate. The following table presents the
amounts of our cash equivalents and short-term investments that are subject to
market risk by range of expected maturity and weighted-average interest rates as
of June 30, 2000 and June 30, 1999. This table does not include money market
funds because those funds are not subject to market risk.

                                       30
<PAGE>

<TABLE>
<CAPTION>
        June 30, 2000:                                                               Maturing in
                                                             ----------------------------------------------------------------
                                                             Three months  Three months  Greater than                    Fair
                                                               or less     to one year     one year       Total         Value
                                                               -------     -----------     --------       -----         -----
                                                                                        (In thousands)
<S>                                                            <C>         <C>             <C>            <C>           <C>
        Included in cash and cash equivalents................. $ 100,696                                  $ 100,696     $ 100,696
          Weighted average interest rate......................     6.37%
        Included in short-term investments....................             $ 66,640                       $  66,640     $  66,640
          Weighted average interest rate......................                 6.50%
        Included in investments...............................                             $ 44,144       $  44,144     $  44,144
          Weighted average interest rate......................                                 7.29%

<CAPTION>

                                                                                         Maturing in
                                                             ---------------------------------------------------------------
        June 30, 1999:                                       Three months  Three months  Greater than                    Fair
                                                               or less     to one year     one year       Total         Value
                                                               -------     -----------     --------       -----         -----
                                                                                        (In thousands)
<S>                                                            <C>         <C>             <C>            <C>           <C>
        Included in cash and cash equivalents................  $  93,819                                  $ 93,819      $ 93,819
          Weighted average interest rate.....................       5.12%
        Included in short-term investments...................              $ 16,422                       $ 16,422      $ 16,422
          Weighted average interest rate.....................                  5.04%
        Included in investments..............................                   300        $ 15,797       $ 16,097      $ 16,097
          Weighted average interest rate.....................                  6.02%           6.36%
</TABLE>

Exchange Rate Sensitivity

    Currently, all of our sales and the majority of our expenses are denominated
in U.S. dollars and as a result, we have experienced no significant foreign
exchange gains and losses to date. While we have conducted some transactions in
foreign currencies during the year ended June 30, 2000 and expect to continue to
do so, we do not anticipate that foreign exchange gains or losses will be
significant. We have not engaged in foreign currency hedging activities to date,
however, we may do so in the future.

                                       31
<PAGE>

Item 8. Financial Statements and Supplementary Data.

     INDEX TO CONSOLIDATED FINANCIAL STATEMENTS OF EXTREME NETWORKS, INC.

<TABLE>
<CAPTION>
                                                                                                                           Page(s)
                                                                                                                          --------
<S>                                                                                                                        <C>
Report of Ernst & Young LLP, Independent Auditors........................................................................    33

Consolidated Balance Sheets..............................................................................................    34

Consolidated Statements of Operations....................................................................................    35

Consolidated Statement of Stockholders' Equity...........................................................................    36

Consolidated Statements of Cash Flows....................................................................................    37

Notes to Consolidated Financial Statements...............................................................................    38
</TABLE>

                                       32
<PAGE>

               Report of Ernst & Young LLP, Independent Auditors

The Board of Directors and Stockholders
Extreme Networks, Inc.

We have audited the accompanying consolidated balance sheets of Extreme
Networks, Inc. as of June 30, 2000 and 1999, and the related consolidated
statements of operations, stockholders' equity and cash flows for each of the
three years in the period ended June 30, 2000. Our audits also included the
financial statement schedule listed in the Index at Item 14(a). These financial
statements and schedule are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
schedule based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the consolidated financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Extreme
Networks, Inc. at June 30, 2000 and 1999, and the consolidated results of its
operations and its cash flows for each of the three years in the period ended
June 30, 2000, in conformity with accounting principles generally accepted in
the United States. Also, in our opinion, the related financial statement
schedule, when considered in relation to the basic consolidated financial
statements taken as a whole, presents fairly in all material respects the
information set forth therein.

                                                               Ernst & Young LLP

Palo Alto, California
July 18, 2000, except for Note 9, as to which the date is August 24, 2000

                                       33
<PAGE>

                            EXTREME NETWORKS, INC.

                          CONSOLIDATED BALANCE SHEETS
              (In thousands, except share and per share amounts)

                                     ASSETS
<TABLE>
<CAPTION>
                                                                        June 30,
                                                                 ---------------------
                                                                    2000        1999
                                                                 ---------   ---------
<S>                                                              <C>         <C>
Current assets:
  Cash and cash equivalents.................................     $ 116,721   $ 107,143
  Short-term investments....................................        66,640      16,422
  Accounts receivable,  net of allowance for doubtful
    accounts of $1,237 in 2000 and $1,374 in 1999...........        60,996      20,797
  Inventories...............................................        23,801       2,626
  Other current assets......................................        34,326       1,978
                                                                 ---------   ---------
          Total current assets..............................       302,484     148,966
Property and equipment, net.................................        26,750       6,506
Restricted investments......................................        80,000          --
Investments.................................................        44,144      16,097
Goodwill and purchased intangibles..........................        49,782          --
Other assets................................................        12,770         234
                                                                 ---------   ---------
                                                                 $ 515,930   $ 171,803
                                                                 =========   =========

                         LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable..........................................     $  39,023   $  13,418
  Accrued compensation......................................         6,759       2,500
  Accrued commissions.......................................         4,282       1,600
  Leasehold improvements allowance..........................         8,424          --
  Deferred revenue..........................................        22,042       1,717
  Other accrued liabilities.................................        12,935       7,394
  Income tax liability......................................         3,138       1,650
  Capital lease obligations, current portion................            --       1,648
                                                                ----------  ----------
          Total current liabilities.........................        96,603      29,927
Long term deposit...........................................           306          --
Commitments (Note 4)
Stockholders' equity:
  Convertible preferred stock, $.001 par value, issuable
    in series: 2,000,000 shares authorized; no shares
    issued and outstanding..................................            --          --
  Common stock, $.001 par value; 150,000,000 shares
     authorized; 106,670,964 and 98,690,460 shares
     issued and June 30, 2000 and 1999, respectively........           106          98
  Additional paid-in capital................................       423,044     165,569
  Deferred stock compensation...............................           (78)       (197)
  Accumulated other comprehensive loss......................          (623)       (118)
  Accumulated deficit.......................................        (3,428)    (23,476)
                                                                 ---------   ---------
          Total stockholders' equity........................       419,021     141,876
                                                                 ---------   ---------
                                                                 $ 515,930   $ 171,803
                                                                 =========   =========
</TABLE>

         See accompanying notes to consolidated financial statements.

                                       34
<PAGE>

                            EXTREME NETWORKS, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                   (In thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                            Years Ended June 30,
                                                    -----------------------------------
                                                        2000         1999         1998
                                                    -----------   ---------    --------
<S>                                                 <C>           <C>         <C>
Net revenue.......................................    $261,956     $ 98,026    $ 23,579
Cost of revenue...................................     126,916       48,520      14,897
                                                      --------    ---------    --------
Gross profit......................................     135,040       49,506       8,682
Operating expenses:
  Research and development........................      32,737       17,036      10,668
  Sales and marketing.............................      67,146       27,056       9,601
  General and administrative......................      11,852        6,859       2,440
  Amortization of goodwill and purchased
   intangibles....................................       7,051           --          --
                                                      --------     --------    --------
       Total operating expenses...................     118,786       50,951      22,709
                                                      --------     --------    --------
Operating income (loss)...........................      16,254       (1,445)    (14,027)
Interest income...................................      14,638        1,855
Interest expense..................................        (490)        (398)       (326)
Other income (loss), net..........................         (33)          21        (196)
                                                      --------     --------    --------
Income (loss) before income taxes.................      30,369           33     (13,936)
Provision for income taxes........................      10,321        1,650          --
                                                      --------     --------    --------
Net income (loss).................................    $ 20,048     $ (1,617)   $(13,936)
                                                      ========     ========    ========

Basic net income (loss) per share.................    $   0.20     $  (0.09)   $  (1.59)
Diluted net income (loss) per share...............    $   0.18     $  (0.09)   $  (1.59)

Weighted average shares outstanding
 used in computing basic net income
 (loss) per share.................................     100,516       18,924       8,758
Weighted average shares outstanding
 used in computing diluted net
 income (loss) per share..........................     111,168       18,924       8,758
</TABLE>

         See accompanying notes to consolidated financial statements.

                                       35
<PAGE>

                            EXTREME NETWORKS, INC.

                CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                     (in thousands, except share amounts)

<TABLE>
<CAPTION>

                                                  Convertible                                                Accumulated
                                                Preferred Stock     Common Stock    Additional    Deferred      Other
                                                ---------------     ------------     Paid-In       Stock     Comprehensive
                                                Shares   Amount   Shares     Amount  Capital   Compensation      Loss
                                                ------   ------   ------     ------  -------   ------------      ----
<S>                                             <C>      <C>      <C>        <C>    <C>        <C>           <C>
Balances at June 30, 1997 .................     46,932    $ 46    21,620     $ 22   $ 17,160     $  --        $  --
Issuance of warrant for 96,694 shares of
 Series B convertible preferred stock .....       --        --        --       --         28        --           --
Issuance of Series C convertible preferred
 stock to investors for cash (less
 issuance costs of $416)...................     11,190      12        --       --     20,105        --           --
Issuance of warrant for 140,352 shares of
 Series C convertible preferred stock .....         --      --        --       --        140        --           --
Exercise of options to purchase
 common stock .............................         --      --     1,450        2        145        --          --
Deferred stock compensation ...............         --      --        --       --        437      (437)         --
Amortization of deferred stock
 compensation .............................         --      --        --       --         --        68          --
Net loss ..................................         --      --        --       --         --        --          --
                                                ------    ----   -------     ----     ------     -----        ----
Balances at June 30, 1998 .................     58,122      58    23,070       24     38,015      (369)         --
Comprehensive loss:
 Net loss .................................         --      --        --       --         --        --          --
 Other comprehensive loss, net of tax:
  Change in unrealized loss on
   investments.............................         --      --        --       --         --        --        (112)
  Foreign currency translation adjustment..         --      --        --       --         --        --          (6)
 Other comprehensive loss .................         --      --        --       --         --        --          --
Comprehensive loss ........................         --      --        --       --         --        --          --
Issuance of warrants to purchase 80,000
 shares of common stock ...................         --      --        --       --        948        --          --
Issuance of common stock in conjunction
 with initial public offering (less
 issuance costs of $1,948).................         --      --    16,100       16    125,306        --          --
Conversion of preferred stock to common
 stock in conjunction with initial
 public offering ..........................    (58,122)    (58)   58,122       58         --        --          --
Exercise of warrants to purchase
 common stock .............................         --      --       264       --         --        --          --
Exercise of options to purchase
 common stock .............................         --      --     1,134       --      1,300        --          --
Amortization of deferred stock
 compensation .............................         --      --        --       --         --       172          --
                                                ------    ----   -------     ----     ------    ------        ----
Balances at June 30, 1999 .................         --      --    98,690       98    165,569      (197)       (118)
Comprehensive income:
 Net income ...............................         --      --        --       --         --        --          --
 Other comprehensive loss, net of tax:
  Change in unrealized loss on
   investments.............................         --      --        --       --         --        --        (503)
  Foreign currency translation adjustment..         --      --        --       --         --        --          (2)
 Other comprehensive loss .................         --      --        --       --         --        --          --
Comprehensive income ......................         --      --        --       --         --        --          --
Issuance of common stock in conjunction
 with secondary public offering(less
 issuance costs of $910) ..................         --      --     4,748        6    174,022        --          --
Exercise of warrants to purchase
 common stock .............................         --      --       370       --         --        --          --
Exercise of options to purchase
 common stock .............................         --      --     2,392        2      3,387        --          --
Issuance of common stock under employee
 stock purchase plan ......................         --      --       470       --      3,966        --          --
Issuance of warrants for goodwill and
 purchased intangibles ....................         --      --        --       --     54,324        --          --
Tax benefit from employee stock
 transactions .............................         --      --        --       --     21,600        --          --
Stock compensation for options granted to
 consultants ..............................         --      --        --       --        176        --          --
Amortization of deferred stock
 compensation .............................         --      --        --       --         --       119          --
                                                ------    ----  --------     ----   --------     -----       -----
Balances at June 30, 2000 .................         --    $ --  $106,670     $106   $423,044     $ (78)      $(623)
                                                ======    ====  ========     ====   ========     =====       =====

<CAPTION>
                                                                       Total
                                                       Accumulated  Stockholders'
                                                         Deficit       Equity
                                                         -------       ------
<S>                                                    <C>          <C>
Balances at June 30, 1997 .................             $ (7,923)   $  9,305
Issuance of warrant for 96,694 shares of
 Series B convertible preferred stock .....                   --          28
Issuance of Series C convertible preferred
 stock to investors for cash (less
 issuance costs of $416)...................                   --      20,117
Issuance of warrant for 140,352 shares of
 Series C convertible preferred stock .....                   --         140
Exercise of options to purchase
 common stock .............................                   --         147
Deferred stock compensation ...............                   --          --
Amortization of deferred stock
 compensation .............................                   --          68
Net loss ..................................              (13,936)    (13,936)
                                                        --------    --------
Balances at June 30, 1998 .................              (21,859)     15,869
Comprehensive loss:
 Net loss .................................               (1,617)     (1,617)
 Other comprehensive loss, net of tax:
  Change in unrealized loss on
   investments.............................                   --        (112)
  Foreign currency translation adjustment..                   --          (6)
                                                                    --------
 Other comprehensive loss .................                   --        (118)
                                                                    --------
Comprehensive loss ........................                   --      (1,735)
Issuance of warrants to purchase 80,000
 shares of common stock ...................                   --         948
Issuance of common stock in conjunction
 with initial public offering (less .......
 issuance costs of $1,948).................                   --     125,322
Conversion of preferred stock to common
 stock in conjunction with initial
 public offering ..........................                   --          --
Exercise of warrants to purchase
 common stock .............................                   --          --
Exercise of options to purchase
 common stock .............................                   --       1,300
Amortization of deferred stock
 compensation .............................                   --         172
                                                        --------     -------
Balances at June 30, 1999 .................              (23,476)    141,876
Comprehensive income:
 Net income ...............................               20,048      20,048
 Other comprehensive loss, net of tax:
  Change in unrealized loss on
   investments.............................                   --        (503)
  Foreign currency translation adjustment..                   --          (2)
                                                                    --------
 Other comprehensive loss .................                   --        (505)
                                                                    --------
Comprehensive income ......................                   --      19,543
Issuance of common stock in conjunction
 with secondary public offering(less
 issuance costs of $910) ..................                   --     174,028
Exercise of warrants to purchase
 common stock .............................                   --          --
Exercise of options to purchase
 common stock .............................                   --       3,389
Issuance of common stock under employee
 stock purchase plan.......................                   --       3,966
Issuance of warrants for goodwill and
 purchased intangibles.....................                   --      54,324
Tax benefit from employee stock
 transactions..............................                   --      21,600
Stock compensation for options granted to
 consultants...............................                   --         176
Amortization of deferred stock
 compensation .............................                   --         119
                                                        --------    --------
Balances at June 30, 2000 .................             $ (3,428)   $419,021
                                                        ========    ========
</TABLE>

         See accompanying notes to consolidated financial statements.

                                      36

<PAGE>

                            EXTREME NETWORKS, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In thousands)

<TABLE>
<CAPTION>
                                                                                Years Ended June 30,
                                                                                --------------------
                                                                           2000          1999         1998
                                                                       --------      --------     --------
<S>                                                                    <C>           <C>          <C>
Operating activities
  Net income (loss)...............................................     $   20,048    $   (1,617)  $   (13,936)
  Adjustments to reconcile net income (loss) to net cash
    provided by (used in) operating activities:
   Depreciation...................................................          6,992         5,733         1,453
   Amortization...................................................          7,052            --            --
   Warrants issued to a business partner..........................             --           948            --
   Amortization of deferred stock compensation....................            119           172            68
   Loss on equity investments.....................................            248            --            --
   Compensation expense for options granted to consultants........            176            --            --
   Changes in operating assets and liabilities:
       Accounts receivable........................................        (40,199)      (12,989)       (7,545)
       Inventories................................................        (21,175)       (2,503)          (86)
       Other current and noncurrent assets........................        (18,832)       (1,392)         (585)
       Accounts payable...........................................         25,605         3,425         9,244
       Accrued compensation.......................................          4,259         2,038           272
       Accrued commissions........................................          2,682         1,127           473
       Leasehold improvements allowance...........................          8,424            --            --
       Deferred revenue...........................................         20,325         1,434           283
       Other accrued liabilities..................................          4,101         4,727         2,203
       Income tax liability.......................................          4,688         1,650            --
       Long term deposit..........................................            306            --            --
       Due to shareholder.........................................             --            --          (109)
                                                                       ----------    ----------   -----------
  Net cash provided by (used in) operating activities.............         24,819         2,753        (8,265)
                                                                       ----------    ----------   -----------

Investing activities
  Capital expenditures............................................        (27,236)       (7,492)       (2,511)
  Purchases and maturities of investments.........................       (158,770)      (21,636)      (10,996)
  Minority investments............................................         (8,970)           --            --
                                                                       ----------    ----------   -----------
  Net cash used in investing activities...........................       (194,976)      (29,128)      (13,507)
                                                                       ----------    ----------   -----------

Financing activities
  Proceeds from issuance of convertible preferred stock...........             --            --        20,285
  Proceeds from issuance of common stock..........................        181,383       126,622           147
  Proceeds from notes payable.....................................             --           783         1,606
  Principal payments on notes payable.............................             --        (2,784)         (241)
  Principal payments of capital lease obligations.................         (1,648)         (613)         (562)
                                                                       ----------    ----------   -----------
  Net cash provided by financing activities.......................        179,735       124,008        21,235
                                                                       ----------    ----------   -----------

  Net increase (decrease) in cash and cash equivalents............          9,578        97,633          (537)
Cash and cash equivalents at beginning of period..................        107,143         9,510        10,047
                                                                       ----------    ----------   -----------
Cash and cash equivalents at end of period........................     $  116,721    $  107,143   $     9,510
                                                                       ==========    ==========   ===========

Supplemental disclosure of cash flow information:
  Interest paid...................................................     $      744    $      185   $       326
  Cash paid for taxes.............................................     $    5,828    $       --   $        --
Supplemental schedule of noncash investing and
    financing activities:
  Property and equipment acquired under capital lease
    obligations...................................................     $       --    $      278   $     1,588
  Warrants issued in connection with capital lease................     $       --    $       --   $       168
  Warrants issued for goodwill and purchased intangibles..........     $   54,324    $       --   $        --
  Warrants issued to a business partner...........................     $       --    $      948   $        --
  Deferred stock compensation.....................................     $       --    $       --   $       437
  Conversion of preferred stock to common stock...................     $       --    $       58   $        --
  Tax benefit from disqualifying dispositions.....................     $   21,600    $       --   $        --
</TABLE>

         See accompanying notes to consolidated financial statements.

                                      37
<PAGE>

                            EXTREME NETWORKS, INC.

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1)   Summary of Significant Accounting Policies

Nature of Operations

     Extreme Networks, Inc. ("Extreme" or the "Company") was incorporated in
California on May 8, 1996 and was reincorporated in Delaware on March 31, 1999.
Extreme is a leading provider of broadband networking solutions for the Internet
economy.

Principles of Consolidation and Basis of Presentation

     The consolidated financial statements include the accounts of Extreme and
its wholly-owned subsidiaries. All significant inter-company balances and
transactions have been eliminated. Investments in which management intends to
maintain more than a temporary 20% to 50% interest, or otherwise has the ability
to exercise significant influence, are accounted for under the equity method.
Investments in which we have less than a 20% interest and/or do not have the
ability to exercise significant influence are carried at the lower of cost or
estimated realizable value.

     Assets and liabilities of foreign operations are translated to U.S. dollars
at current rates of exchange, and revenues and expenses are translated using
weighted average rates. Foreign currency transaction gains and losses have not
been material. Gains and losses from foreign currency translation are included
as a separate component of other comprehensive income (loss).

     Certain items previously reported in specific financial statement captions
have been reclassified to conform to the 2000 presentation. Such
reclassifications have not impacted previously reported operating income (loss).

Fiscal Year

     Effective July 1, 1999, Extreme changed its fiscal year from June 30/th/ to
a 52/53-week fiscal accounting year. The June 30, 2000 year closed on July 2,
2000 and comprised 52 weeks of revenue and expense activity. All references
herein to "fiscal 2000" or "2000" represent the fiscal year ended July 2, 2000.
Quarterly results are based upon a 13-week reporting period.

Accounting Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of revenue and
expenses during the reporting period. Estimates are used for, but not limited
to, the accounting for doubtful accounts, inventory reserves, depreciation and
amortization, sales returns, warranty costs and income taxes. Actual results
could differ from these estimates.

Cash Equivalents and Short-Term Investments

     Extreme considers cash and all highly liquid investment securities
purchased with an original or remaining maturity of less than three months at
the date of purchase to be cash equivalents. Extreme's investments comprise
U.S., state and municipal government obligations and corporate securities.
Investments with maturities of less than one year are considered short term and
investments with maturities greater than one year are considered long term.

     To date, all marketable securities have been classified as
available-for-sale and are carried at fair value, with unrealized gains and
losses, when material, reported net-of-tax as a separate component of other
comprehensive income. Realized gains and losses on available-for-sale securities
are included in interest income. The cost of securities sold is based on
specific identification. Premiums and discounts are amortized over the period
from acquisition to maturity and are included in investment income, along with
interest and dividends.

Fair Value of Financial Instruments

                                      38
<PAGE>

     The carrying amounts of certain of Extreme's financial instruments,
including cash and equivalents, approximate fair value because of their short
maturities. The fair values of investments are determined using quoted market
prices for those securities or similar financial instruments (see Note 2).

Transfer of Financial Assets

     The Company from time to time transfers specifically identified accounts
receivable balances from customers to financing institutions, on a non-recourse
basis. The Company records such transfers as sales of the related accounts
receivable when it is considered to have surrendered control of such receivables
under the provisions of Statement of Financial Accounting Standards No. 125,
"Accounting for Transfers and Servicing of Financial Assets and Extinguishments
of Liabilities." The impact of the above transaction reduced receivables and
increased cash flows from operating activities in the consolidated statements of
cash flows.

Inventories

     Inventories consist of raw materials and finished goods and are stated at
the lower of cost or market (on a first-in, first-out basis).

          Inventories consist of:
                                          June 30, 2000           June 30, 1999
                                          -------------           -------------
               Raw materials                    $ 9,501                  $  700
               Finished goods                    14,300                   1,926
                                       ----------------        ----------------
                    Total                       $23,801                  $2,626
                                       ================        ================


Restricted Investments

     Extreme restricted $80.0 million of its investment securities as collateral
for specified obligations of the lessee under the operating lease. These
investment securities are restricted as to withdrawal and are managed by a third
party subject to certain limitations under the Company's investment policy. (See
Note 4)

Concentration of Credit Risk, Product and Significant Customers and Supplier
Information

     Financial instruments that potentially subject Extreme to concentration of
credit risk consist principally of marketable investments and accounts
receivable. Extreme places its investments only with high-credit quality
issuers. Extreme will not invest an amount exceeding 10% of the corporation's
combined cash, cash equivalent, short-term and long-term investments, in the
securities of any one obligor or maker, except for obligations of the United
States, obligations of United States agencies and money market accounts. Extreme
performs ongoing credit evaluations of its customers and generally does not
require collateral. To date, credit losses have been insignificant and within
management's expectations. Extreme operates solely within one business segment,
the development and marketing of switching solutions for the Internet economy.
For fiscal 2000, there were no customers with sales greater than 10%. For fiscal
1999, Compaq and Hitachi Cable accounted for 21% and 13% of our net revenue,
respectively.

     One supplier currently manufacturers all of Extreme's ASICs which are used
in all of Extreme's networking products. Any interruption or delay in the supply
of any of these components, or the inability to procure these components from
alternate sources at acceptable prices and within a reasonable time, would
materially adversely affect Extreme's business, operating results and financial
condition. In addition, qualifying additional suppliers can be time-consuming
and expensive and may increase the likelihood of errors. Extreme attempts to
mitigate these risks by working closely with its ASIC supplier regarding
production planning and product introduction timing.

     Extreme currently derives substantially all of its revenue from sales of
two product families. Extreme expects that revenue from these two product
families will account for a substantial portion of its revenue for the
foreseeable future. Accordingly, widespread market acceptance of Extreme's
product families is critical to their future success.

Property and Equipment

                                      39
<PAGE>

Property and Equipment

     Property and equipment are stated at cost and depreciated on a
straight-line basis over the estimated useful lives of the assets of
approximately three years. Property and equipment consist of the following (in
thousands):

<TABLE>
<CAPTION>
                                                                            June 30,
                                                                  -----------------------------
                                                                       2000          1999
                                                                       ----          ----
     <S>                                                          <C>               <C>
     Computer and other related equipment....................         $  27,257     $  8,661
     Office equipment, furniture and fixtures................             1,905        1,090
     Software................................................             4,956        3,146
     Leasehold improvements..................................             1,802        1,111
                                                                      ---------     --------
                                                                         35,920       14,008
     Less accumulated depreciation and amortization..........            (9,170)      (7,502)
                                                                      ---------     --------
     Property and equipment, net.............................         $  26,750     $  6,506
                                                                      =========     ========
</TABLE>

Goodwill and Purchased Intangible Assets

     We record goodwill when the cost of net assets we acquire exceeds their
fair value. Goodwill is amortized on a straight-line basis over lives ranging
from 2 to 4 years. The cost of identified intangibles is generally amortized on
a straight-line basis over periods ranging from 2 to 4 years. We regularly
perform reviews to determine if the carrying value of assets is impaired. The
reviews look for the existence of facts or circumstances, either internal or
external, which indicate that the carrying value of the asset cannot be
recovered. No such impairment has been indicated to date. If, in the future,
management determines the existence of impairment indicators, we would use
undiscounted cash flows to initially determine whether impairment should be
recognized. If necessary, we would perform a subsequent calculation to measure
the amount of the impairment loss based on the excess of the carrying value over
the fair value of the impaired assets. If quoted market prices for the assets
are not available, the fair value would be calculated using the present value of
estimated expected future cash flows. The cash flow calculations would be based
on management's best estimates, using appropriate assumptions and projections at
the time.

     The total purchase price of the goodwill and purchased intangible assets
was allocated based on an independent appraisal obtained by the Company, to the
tangible and intangible assets acquired based on their respective fair values on
the date of acquisition as follows (in thousands):

          Customer list..............................      $ 4,169
          Acquired workforce.........................        4,615
          Goodwill...................................       48,050
                                                       -----------
                                                           $56,834
                                                       ===========


Revenue Recognition

     Extreme generally recognizes product revenue at the time of shipment,
unless Extreme has future obligations such as installation or has to obtain
customer acceptance. When significant obligations remain after products are
delivered, revenue is only recognized after such obligations are fulfilled.

     Amounts billed in excess of revenue recognized are included as deferred
revenue in the accompanying consolidated balance sheets. Extreme has established
a program which, under specified conditions, enables third party resellers to
return products to us. The amount of potential product returns is estimated and
provided for in the period of the sale. Revenue from service obligations is
recognized ratably over the term of the contract period, which is typically 12
months. Extreme makes certain sales to partners in two-tier distribution
channels. These customers are generally given privileges to return a portion of
inventory and participate in various cooperative marketing programs. Extreme
defers recognition of revenue on such sales until the product is sold by the
distributors and also maintains appropriate accruals and allowances for all
other programs.

     Upon shipment of products to its customers, Extreme provides for the
estimated cost to repair or replace products that may be returned under
warranty. Extreme's warranty period is typically 12 months from the date of
shipment to the end user.

Advertising

                                      40
<PAGE>

Advertising

     We expense advertising costs as incurred. Advertising expenses for the
years ended June 30, 2000, 1999 and 1998 were approximately $2.2 million, $1.1
million and $0.4 million, respectively.

Foreign Operations

     Extreme's foreign offices consist of sales, marketing and support
activities through its foreign subsidiaries and overseas resellers and
distributors. Operating income (loss) generated by Extreme's operating foreign
subsidiaries and their corresponding identifiable assets were not material in
any period presented.

     Extreme's export sales represented 45% and 53% of net revenue in 2000 and
1999, respectively. All of the export sales to date have been denominated in
U.S. dollars and were derived from sales to Europe and Asia. Extreme recorded
export sales over 10% (as a percentage of total net revenue) to the following
countries:

<TABLE>
<CAPTION>
                                                                                   Years Ended June 30,
                                                                                   --------------------
                                                                                   2000            1999
                                                                                   ----            ----
     <S>                                                                           <C>             <C>
     Japan.....................................................................     19%             29%
     All other export sales to countries totaling less than 10% each...........     26%             24%
</TABLE>

Net Income (Loss) Per Share

     Basic earnings (loss) per share is calculated by dividing net income (loss)
by the weighted average number of common shares outstanding during the period,
less shares subject to repurchase, and excludes any dilutive effects of options,
warrants, and convertible securities. Dilutive earnings per common share is
calculated by dividing net income by the weighted average number of common
shares used in the basic earnings per common share calculation plus the dilutive
effect of options and warrants.

     The following table presents the calculation of basic and diluted net
income (loss) per share (in thousands, except per share data):

<TABLE>
<CAPTION>
                                                                                          Years Ended June 30,
                                                                                          --------------------
                                                                                     2000          1999          1998
                                                                                     ----          ----          ----
     <S>                                                                           <C>          <C>           <C>
     Net income (loss)..................................................           $   20,048   $   (1,617)   $  (13,936)
                                                                                     ========     ========    ==========
          Weighted-average shares of common stock outstanding...........              103,734       27,324        22,384
          Less: Weighted-average shares subject to repurchase...........               (3,218)      (8,400)      (13,626)
                                                                                   ----------   ----------    ----------
     Weighted-average shares used in computing basic
        net income (loss) per common share..............................              100,516       18,924         8,758
                                                                                   ==========   ==========    ==========
     Incremental shares using the treasury stock method                                10,652           --            --
     Weighted-average shares used in computing diluted
        net income (loss) per common share..............................              111,168       18,924         8,758
                                                                                   ----------       ======         =====
     Basic net income (loss) per common share...........................           $     0.20   $    (0.09)   $    (1.59)
                                                                                   ==========   ==========    ==========
     Diluted net income (loss) per common share.........................           $     0.18   $    (0.09)   $    (1.59)
                                                                                   ==========   ==========    ==========
</TABLE>

     Share and per-share data presented reflect the two-for-one stock split
effective to stockholders of record on August 10, 2000.

Accounting for Stock-Based Compensation

     Extreme's grants of stock options are for a fixed number of shares to
employees with an exercise price equal to the fair value of the shares at the
date of grant. As permitted under SFAS Statement No. 123, "Accounting for
Stock-Based Compensation" ("FAS 123"), Extreme accounts for stock option grants
to employees and directors in accordance with APB Opinion No. 25, "Accounting
for Stock Issued to Employees" ("APB 25") and, accordingly, recognizes no
compensation expense for stock option grants with an exercise price equal to the
fair value of the shares at the date of grant.

Recently Issued Accounting Standards

     In June 1997, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 131, "Disclosures about Segments of an Enterprise and Related Information"
("FAS 131") effective for financial statements for periods beginning after
December 15, 1997.

                                      41
<PAGE>

FAS 131 establishes standards for the way that public business enterprises
report financial and descriptive information about reportable operating segments
in annual financial statements and interim financial reports issued to
shareholders. FAS 131 supersedes SFAS No. 14, "Financial Reporting for Segments
of a Business Enterprise," but retains the requirement to report information
about major customers. Extreme has determined that it has a single reportable
segment. Management uses one measurement of profitability and does not
disaggregate its business for internal reporting.

     In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities" ("FAS 133"). FAS 133 establishes methods of
accounting for derivative financial instruments and hedging activities related
to those instruments as well as other hedging activities. In June 1999, the FASB
issued SFAS No. 137, "Accounting for Derivative Instruments and Hedging
Activities - Deferral of the Effective Date of FASB Statement No. 133", which
extended the deferral of the application of FAS 133 to all fiscal quarters of
fiscal years beginning after June 15, 2000. In June 15, 2000 the FASB also
issued FAS 138, "Accounting for Certain Derivative Instruments and Certain
Hedging Activities) an Amendment to FASB Statement No. 133". FAS 138 amends the
accounting and reporting standards of Statement 133 for certain derivative
instruments and certain hedging activities. The Company will be required to
adopt these pronouncements for the year ending June 30, 2001. Because the
Company currently holds no derivative financial instruments and does not
currently engage in hedging activities, adoption of FAS 133 and 138 are expected
to have no material impact on the Company's financial condition or results of
operations.

     In December 1999, the Staff of the Securities and Exchange Commission
("SEC") issued Staff Accounting Bulletin ("SAB") No.101, "Revenue Recognition in
Financial Statements", which provides guidance on the recognition, presentation
and disclosure of revenue in financial statements. The implementation of SAB 101
has recently been deferred to no later than the fourth fiscal quarter of fiscal
years beginning after December 15, 1999. Extreme is presently evaluating the
potential impact of the adoption of SAB 101.

     In March 2000, the FASB issued Financial Accounting Standards Board
Interpretation No. 44, "Accounting for Certain Transactions involving Stock
Compensation - an interpretation of APB Opinion No. 25" (Interpretation No. 44).
Interpretation No. 44 is effective July 1, 2000. The interpretation clarifies
the application of APB Opinion No. 25 for certain issues, specifically, (a) the
definition of an employee, (b) the criteria for determining whether a plan
qualifies as a noncompensatory plan, (c) the accounting consequence of various
modifications to the terms of a previously fixed stock option or award, and (d)
the accounting for an exchange or stock compensation awards in a business
combination. We do not anticipate that the adoption of Interpretation No. 44
will have a material impact on our financial position or the results of our
operations.

2)   Financial Instruments

     The following is a summary of available-for-sale securities (in thousands):

<TABLE>
<CAPTION>
                                                                                            Unrealized    Unrealized
                                                                Amortized        Fair        Holding       Holding
                                                                  Cost          Value         Gains         Losses
                                                                  ----          -----         -----         ------
<S>                                                             <C>             <C>         <C>           <C>
June 30, 2000:
     Money market fund........................................   $  12,372      $ 12,372      $  --       $     --
     Commercial paper.........................................      71,929        71,889         --            (40)
     U.S. corporate debt securities...........................     107,994       107,410         29           (613)
     U.S. government agencies.................................       9,800         9,809         11             (2)
     U.S. tax exempt securities...............................      10,000        10,000         --             --
                                                                 ---------      --------    -------       --------
                                                                 $ 212,095      $211,480      $  40       $   (655)
                                                                 =========      ========    =======       ========
     Classified as:
          Cash equivalents....................................   $ 100,736      $100,696      $  --       $    (40)
          Short-term investments..............................      66,976        66,640         26           (362)
          Investments.........................................      44,383        44,144         14           (253)
                                                                 ---------      --------    -------       --------
                                                                 $ 212,095      $211,480      $  40       $   (655)
                                                                 =========      ========    =======       ========

<CAPTION>
                                                                                            Unrealized    Unrealized
                                                                Amortized        Fair        Holding       Holding
                                                                  Cost          Value         Gains         Losses
                                                                  ----          -----         -----         ------
<S>                                                             <C>             <C>         <C>           <C>
June 30, 1999:
     Money market fund......................................    $       2       $      2    $       -     $       --
</TABLE>

                                      42
<PAGE>

<TABLE>
     <S>                                           <C>           <C>           <C>        <C>
     Commercial paper..........................     110,265       110,241         --         (24)
     U.S. corporate debt securities............      15,885        15,797         --         (88)
     U.S. government agencies..................         300           300         --          --
                                                   --------     ---------      -----      ------
                                                   $126,452      $126,340      $  --      $ (112)
                                                   ========     =========      =====      ======

     Classified as:
          Cash equivalents.....................    $ 93,840      $ 93,821      $  --      $  (19)
          Short-term investments...............      16,427        16,422         --          (5)
          Investments..........................      16,185        16,097         --         (88)
                                                   --------      --------      -----      ------
                                                   $126,452      $126,340      $  --      $ (112)
                                                   ========      ========      =====      ======
</TABLE>

3)   Business Combinations and Investments

      During the fiscal year ended June 30, 2000, Extreme acquired certain
assets of a Company for a total cost of approximately $2.5 million of which $1.1
million has been paid. Extreme accounted for the acquisition using the purchase
method of accounting, and incurs charges of approximately $157,000 per quarter
related to the amortization of goodwill over the estimated useful life of four
years. The entire purchase price was allocated to goodwill and purchased
intangibles. Extreme recorded approximately $261,000 for amortization related to
this acquisition in the year ended June 30, 2000.

      In April 2000, Extreme issued fully earned, non-forfeitable, fully
exercisable warrants with a two year life to purchase 3 million shares of
Extreme's common stock with an exercise price of $39.50 per share to a
networking company in consideration of the networking company's selection of
Extreme as the preferred vendor of next generation core backbone switching
products to a certain group of the networking company's customers. The fair
value of the warrants was approximately $54.3 million. The warrants were valued
under a Black-Scholes model, using a volatility assumption of 1.04% and a
two-year term. The value of the warrants is being amortized over approximately
two years, which is the estimated economic life of the acquired intangibles,
comprising of customer list, workforce and goodwill.

      Extreme made several additional investments during the year ended June 30,
2000 totaling $7.7 million, which are reflected in "Other assets" in the
accompanying consolidated balance sheets. Two investments were made in entities
in which a related party of Extreme is also a significant investor. These
investments totaled $3.4 million, net of Extreme's share of these affiliates'
losses of $0.3 million. As these investments are being accounted for under the
equity-method, the revenue and operating costs of these entities have not been
included in Extreme's results from operations, however Extreme's share of these
affiliates' losses have been included in other expense from the closing date of
the related transactions forward. Pursuant to the terms of these two agreements,
Extreme has certain rights to acquire the remaining shares of these entities
under certain conditions for additional consideration. Under the terms of one of
these equity investments, Extreme has been granted the right at any time prior
to December 31, 2000 to purchase all of the outstanding capital stock and
options for shares of Extreme common stock. Upon the attainment of certain
technological milestones, the terms of one investment will obligate Extreme to
purchase all the outstanding capital stock in fiscal 2001, payable in any
combination of cash or shares of Extreme common stock. At June 30, 2000 the
possibility of attainment of any of the technical milestones was remote. The
remaining $4.3 million of investments at June 30, 2000 are being accounted for
under the cost method. We expect to continue to make additional investments in
the future.

4)   Commitments

      Extreme currently has outstanding fiscal year 2001 non-cancelable purchase
order commitments for materials of approximately $73.3 million. The fiscal year
2000 purchase orders have been fulfilled and the related invoices have been
accrued as of June 30, 2000. This expense is included within cost of revenue in
the year ended June 30, 2000.

      In June 2000, we entered into an operating lease agreement to lease
275,000 square feet to house our primary facility in Santa Clara, California.
Our lease payments will vary based on the LIBOR plus a spread which was 7.14% at
June 30, 2000. Our lease payments are estimated to be approximately $5.7 million
on an annual basis over the lease term. The lease is for five years and can be
renewed for two five-year periods, subject to the approval of the lessor. At the
expiration or termination of the lease, we have the option to either purchase
the property for $80.0 million, or arrange for the sale of the property to a
third party for at least $80.0 million with a contingent liability for any
deficiency. If the property is not purchased or sold as described above, we will
be obligated for an additional lease payment of approximately $68.0 million.

                                      43
<PAGE>

     As part of the above lease transaction, Extreme restricted $80.0 million of
its investment securities as collateral for specified obligations of the lessor
under the lease. These investment securities are restricted as to withdrawal and
are managed by a third party subject to certain limitations under Extreme's
investment policy. The lease also requires us to maintain specified financial
covenants with which we were in compliance as of June 30, 2000.

     Future payments under all noncancelable leases (net of future committed
sublease proceeds of $9,161) at June 30, 2000 are as follows (in thousands):

     Years ending June 30:

          2001......................................        $ 2,691
          2002......................................          2,758
          2003......................................          5,200
          2004......................................          6,504
          2005......................................          6,242
                                                            -------
     Total minimum payments.........................        $23,395
                                                            =======

    Rent expense was approximately $2.9 million, $0.7 million and $0.8 million
for 2000, 1999 and 1998, respectively. Sublease income for the years ended 2001,
2002 and 2003 was $3.9 million, $3.9 million and $1.4 million, respectively.
These amounts were netted from the amounts in the above schedule.

5)   Stockholders' Equity

Common Stock Offering

     In April 1999, Extreme completed an initial public offering of 16,100,000
shares of common stock (including the underwriters' over-allotment provision) at
a price of $8.50 per share. Concurrent with the initial public offering, all
outstanding shares of preferred stock were converted to a total of 58,122,630
shares of common stock. Net proceeds from the offering were approximately $125.3
million net of offering costs.

     On October 20, 1999, Extreme announced the completion of a secondary public
offering of approximately 15 million shares (including the underwriters'
over-allotment provision) of its common stock at a price of $38.50 per share. Of
these shares, Extreme sold 4,745,416 shares and existing stockholders sold
10,204,584 shares. Extreme raised approximately $174.0 million net of offering
costs.

Preferred Stock

     The number of shares of preferred stock authorized to be issued at June 30,
2000 is 2,000,000 with a par value of $0.001 per share. The preferred stock may
be issued from time to time in one or more series. The board of directors is
authorized to provide for the rights, preferences and privileges of the shares
of each series and any qualifications, limitations or restrictions on these
shares. As of June 30, 2000, no shares of preferred stock had been issued.

Common Stock

     In May 1996, Extreme issued 9,450,000 shares of common stock to founders
for cash. The common stock is subject to repurchase until vested; vesting with
respect to 25% occurs on the first anniversary of the issuance date, with the
balance vesting ratably over a period of three years as specified in the
purchase agreements. At June 30, 1999, approximately 1,182,000 shares were
subject to repurchase at their original issuance price (none at June 30, 2000).

Warrants

     In November 1996, Extreme issued warrants to a lease financing company to
purchase 420,000 shares of Series A convertible preferred stock with an exercise
price of $.17 per share, in consideration for equipment leases and a loan. In
July 1997, Extreme issued warrants to the same lease financing company to
purchase 96,694 shares of Series B convertible preferred stock with an exercise
price of $.69 per share, in consideration for equipment leases. Concurrent with
the initial public offering, these warrants converted into the

                                      44
<PAGE>

right to purchase equivalent number of shares of common stock at the same
exercise price per share. The warrants may be exercised at any time within a
period of (i) 10 years or (ii) 5 years from the effective date of the initial
public offering, whichever is longer. In May 1999, 294,000 of these warrants
were exercised. In August 1999, 222,694 of these warrants were exercised.

     In November 1997, Extreme issued warrants to a lease financing company to
purchase 158,102 shares of Series C convertible preferred stock with an exercise
price of $1.27, in consideration for a loan. Concurrent with the initial public
offering, these warrants converted into the right to purchase equivalent number
of shares of common stock at the same exercise price per share. The warrants may
be exercised at any time within a period which expires the sooner of (i) 10
years or (ii) 3 years from the effective date of the initial public offering. In
August 1999, all of the 158,102 warrants were exercised.

     In June 1999, Extreme issued fully vested, non-forfeitable and exercisable
warrants to a business partner to purchase 80,000 shares of Extreme's common
stock with an exercise price of $29.03 per share. The fair value of these
warrants was approximately $948,000. This value was expensed in fiscal 1999 as
the warrants were issued in exchange for services rendered.

     As discussed in Note 3, in April 2000, Extreme issued fully earned,
non-forfeitable, fully exercisable warrants with a two year life to purchase 3
million shares of Extreme's common stock with an exercise price of $39.50 per
share.

     In June 2000, Extreme issued fully vested, non-forfeitable and exercisable
options to consultants to purchase 120,000 shares of Extreme's common stock with
an exercise price of $14.02 per share. The fair value of these options was
approximately $1.7 million. The options were valued under a Black-Scholes model,
using a volatility assumption of 1.04%. This amount will be amortized over two
years as the services are rendered. The compensation expense for the year ended
June 30, 2000 was $176,000.

Deferred Stock Compensation

     During the year ended June 30, 1998, in connection with the grant of
certain stock options to employees, Extreme recorded deferred stock compensation
of $437,000 representing the difference between the exercise price and the
deemed fair value of Extreme's common stock on the date such stock options were
granted. Such amount is included as a reduction of stockholders' equity and is
being amortized by charges to operations on a graded vesting method. Extreme
recorded amortization of deferred stock compensation expense of approximately
$119,000, $172,000 and $68,000 for the years ended June 30, 2000, 1999 and 1998,
respectively. At June 30, 2000, Extreme had a total of approximately $78,000
remaining to be amortized over the corresponding vesting period of each
respective option, generally four years. The amortization expense relates to
options awarded to employees in all operating expense categories.

Amended 1996 Stock Option Plan

     In January 1999, the board of directors approved an amendment to the 1996
Stock Option Plan (the "Plan") to (i) increase the share reserve by 10,000,000
shares, (ii) to remove certain provisions which are required to be in option
plans maintained by California privately-held companies and (iii) to rename the
Plan as the "Amended 1996 Stock Option Plan."

     Under the Plan, which was originally adopted in September 1996, options may
be granted for common stock, pursuant to actions by the board of directors, to
eligible participants. A total of 34,028,618 shares have been reserved under the
Plan. Options granted are exercisable as determined by the board of directors.
Options vest over a period of time as determined by the board of directors,
generally four years. The term of the Plan is ten years. Options to purchase
approximately 1,470,286 and 4,655,558 shares of common stock have been exercised
as of June 30, 2000 and 1999, respectively, but are subject to repurchase until
vested. As of June 30, 2000, 3,834,388 shares were available for future grant
under the Plan.

2000 Stock Option Plan

     In March 2000, the board of directors adopted the 2000 Nonstatutory Stock
Option Plan (the "Plan"). Options may be granted for common stock, pursuant to
actions by the board of directors, to eligible participants. A total of
4,000,000 shares have been reserved under the Plan. Options vest over a period
of time as determined by the board of directors, generally four years. The term
of the Plan is ten years.

     The following table summarizes stock option activity under all plans:

                                      45
<PAGE>

<TABLE>
<CAPTION>
                                                                                         Weighted-
                                                                                          Average
                                                                          Number of    Exercise Price
                                                                            Shares        Per Share
                                                                            ------        ---------
     <S>                                                                  <C>          <C>
     Options outstanding at June 30, 1997...........................       3,151,500     $   .03
        Granted.....................................................       3,542,920     $   .65
        Exercised...................................................      (1,449,550)    $   .11
        Canceled....................................................         (37,000)    $   .18
                                                                        ------------
     Options outstanding at June 30, 1998...........................       5,207,870     $   .42
        Granted.....................................................       5,875,516     $  5.05
        Exercised...................................................      (1,135,600)    $   .93
        Canceled....................................................        (190,252)    $  3.34
                                                                        ------------
     Options outstanding at June 30, 1999...........................       9,757,534     $  3.04
        Granted.....................................................      12,404,750     $ 33.99
        Exercised...................................................      (2,392,472)    $  1.23
        Canceled....................................................      (1,374,704)    $ 26.91
                                                                        ------------
     Options outstanding at June 30, 2000...........................      18,395,108     $ 22.74
                                                                        ============
</TABLE>

     Options to purchase 6,721,582 and 9,368,034 shares were exercisable at June
30, 2000 and 1999, respectively, with a weighted-average exercise price of $3.75
and $2.22, respectively.

     The following table summarizes significant ranges of outstanding and
exercisable options at June 30, 2000:

<TABLE>
<CAPTION>
                                             Options Outstanding                                 Options Exercisable
                          -----------------------------------------------------------  ----------------------------------------
                                                  Weighted-           Weighted-                                 Weighted-
       Range of                                    Average             Average                                   Average
       Exercise                 Number            Remaining           Exercise                Number            Exercise
        Prices                Outstanding      Contractual Life         Price              Exercisable            Price
        ------                -----------      ----------------         -----              -----------            -----
                                                  (In years)
  <S>                         <C>              <C>                    <C>                  <C>                  <C>
  $  0.01 -   2.88              3,854,758            7.32              $  1.43               3,854,758          $   1.43
  $  3.25 -  28.00              3,869,580            8.63              $ 11.15               2,769,948          $   5.96
  $ 28.03 -  32.57              1,896,868            9.25              $ 29.97                   8,126          $  29.03
  $ 32.72 -  33.32              4,051,500            9.39              $ 33.30                  88,750          $  33.32
  $ 33.57 -  57.50              4,722,402            8.87              $ 37.66                      --          $     --
                              -----------                                                  -----------
  $  0.01 -  57.50             18,395,108            8.65              $ 22.74               6,721,582          $   3.75
                              ===========                                                  ===========
</TABLE>

1999 Employee Stock Purchase Plan

     In January 1999, the board of directors approved the adoption of Extreme's
1999 Employee Stock Purchase Plan (the "1999 Purchase Plan"). A total of
2,000,000 shares of common stock have been reserved for issuance under the 1999
Purchase Plan. The 1999 Purchase Plan permits eligible employees to acquire
shares of Extreme's common stock through periodic payroll deductions of up to
15% of total compensation. No more than 1,250 shares may be purchased on any
purchase date per employee. Each offering period will have a maximum duration of
12 months. The price at which the common stock may be purchased is 85% of the
lesser of the fair market value of Extreme's common stock on the first day of
the applicable offering period or on the last day of the respective purchase
period. The initial offering period commenced on the effectiveness of the
initial public offering and ended on April 30, 2000. Through June 30, 2000,
470,978 shares were purchased under the 1999 Purchase Plan.

Stock-Based Compensation

     Extreme has elected to continue to follow APB 25 and related
interpretations in accounting for its employee and director stock-based
compensation plans. Because the exercise price of Extreme's employee stock
options equals the market price of the underlying stock on the date of grant, no
compensation expense has been recognized.

     Pro forma information regarding net income (loss) has been determined as if
Extreme had accounted for its stock-based awards to employees under the fair
value method prescribed by FAS 123. The resulting effect on pro forma net income
(loss) disclosed is not

                                      46
<PAGE>

likely to be representative of the effects on net income (loss) on a pro forma
basis in future years, due to subsequent years including additional grants and
years of vesting.

     Prior to Extreme's initial public offering, the fair value of each option
grant was determined on the date of grant using the minimum value method.
Subsequent to the offering, the fair value of Extreme's stock-based awards to
employees has been estimated using the Black-Scholes option pricing model. The
Black-Scholes option valuation model was developed for use in estimating the
fair value of traded options that have no vesting restrictions and are fully
transferable. The Black-Scholes model requires the input of highly subjective
assumptions including the expected stock price volatility. Because Extreme's
stock-based awards have characteristics significantly different from those in
traded options and because changes in the subjective input assumptions can
materially affect the fair value estimate, in management's opinion, the existing
models do not necessarily provide a reliable single measure of the fair value of
Extreme's stock-based awards. The following weighted-average assumptions were
used to estimate fair value:

<TABLE>
<CAPTION>
                                                Stock Option Plan                        Employee Stock Purchase Plan
                                     ---------------------------------------        --------------------------------------
                                              Years Ended June 30,                           Years Ended June 30,
                                     ---------------------------------------        --------------------------------------
                                       2000           1999          1998               2000          1999          1998
                                     ---------     ----------    -----------        ----------    -----------    ---------
<S>                                  <C>           <C>           <C>                <C>           <C>            <C>
Expected life                          3.4 yrs        3.5 yrs        6.0 yrs           0.6yrs     0.7 yrs.            --
Volatility                             1.12%           55%            --               1.12%       55%                --
Risk-free interest rate                6.3%           5.1%           6.0%               5.4%      5.0%                --
</TABLE>

     The weighted-average estimated fair value of options granted in the years
ended June 30, 2000, 1999 and 1998 was $24.23 $2.21 and $0.19, respectively. The
weighted-average estimated fair value of shares granted under the 1999 Purchase
Plan in the years ended June 30, 2000 and 1999 was $7.51 and $2.81,
respectively.

     For purposes of pro forma disclosures, the estimated fair value of options
is amortized to pro forma expense over the options' vesting period. Pro forma
information follows (in thousands, except per share amounts):

<TABLE>
<CAPTION>
                                                                                     Years Ended June 30,
                                                                                     --------------------
                                                                                2000          1999         1998
                                                                                ----          ----         ----
     <S>                                                                  <C>           <C>          <C>
     Pro forma net loss under FAS 123...................................  $ (31,088)    $ (4,066)    $ (14,053)
     Net loss per common share - pro forma under FAS 123:
        Basic and diluted...............................................  $   (0.32)    $  (0.22)    $   (1.61)
</TABLE>

6)   Income Taxes

      Due to operating losses and the inability to recognize the benefits
therefrom, there was no tax provision for the year ended June 30, 1998.

     The provision for income taxes for the years ended June 30, 2000 and 1999
consists of the following (in thousands):

<TABLE>
<CAPTION>
                                                                        Years Ended June 30,
                                                                        --------------------
                                                                     2000                 1999
                                                                     ----                 ----
          <S>                                                      <C>                    <C>
          Current:
               Federal........................................     $  24,811              $    350
               State..........................................         2,026                   200
               Foreign........................................           306                 1,100
                                                                   ---------              --------
          Total current ......................................     $  27,143              $  1,650
                                                                   =========              ========

          Deferred:
               Federal                                             $(15,497)              $      -
               State                                                 (1,325)                     -
                                                                   --------               --------
          Total deferred                                           $(16,822)              $      -
                                                                   ========               ========

          Provision for income taxes                               $ 10,321               $  1,650
                                                                   ========               ========
</TABLE>

                                      47
<PAGE>

     The tax benefit resulting from the exercise of nonqualified stock options
and the disqualifying dispositions of shares acquired under Extreme's incentive
stock option plans was $21,600,000 for the year ended June 30, 2000. Such
benefit was credited to additional paid-in capital.

     Pretax loss from foreign operations was $10,663,288 and $7,021,204 in the
years ended June 30, 2000 and 1999, respectively.

     The difference between the provision for income taxes and the amount
computed by applying the Federal statutory income tax rate (35 percent) to
income before taxes is explained below (in thousands):

<TABLE>
<CAPTION>
                                                                                 Years Ended June 30,
                                                                                 --------------------
                                                                          2000          1999           1998
                                                                          ----          -----          ----
     <S>                                                               <C>            <C>            <C>
     Tax at federal statutory rate (benefit)........................   $   10,666     $     11       $(4,878)
     State income tax...............................................        1,018          200            --
     Federal alternative minimum taxes..............................           --          350            --
     Foreign taxes..................................................           69        1,100            --
     Unbenefited (utilized) net operating losses....................         (773)         (11)        4,878
     Tax credits....................................................       (1,576)          --            --
     Valuation allowance decrease...................................       (5,148)          --            --
     Unbenefited foreign loss.......................................        3,974           --            --
     Other..........................................................        2,091           --            --
                                                                       ----------     --------       -------
          Total.....................................................   $   10,321     $  1,650       $    --
                                                                       ==========     ========       =======
</TABLE>

     Significant components of Extreme's deferred tax assets are as follows (in
thousands):

<TABLE>
<CAPTION>
                                                                                    Years Ended June 30,
                                                                                    --------------------
                                                                                     2000          1999
                                                                                     ----          ----
     <S>                                                                            <C>           <C>
     Deferred tax assets:
          Net operating loss carryforwards.........................................  $    431     $  1,647
          Tax credit carryforwards.................................................     2,358        2,238
          Depreciation.............................................................     1,951          407
          Deferred revenue.........................................................     3,545          373
          Warrant amortization.....................................................     2,673           --
          Other reserves and accruals .............................................     7,500        3,887
                                                                                     --------     --------
     Total deferred tax assets.....................................................    18,458        8,552
     Valuation allowance...........................................................       --        (8,552)
                                                                                     --------     --------
     Net deferred tax assets.......................................................  $ 18,458     $     --
                                                                                     ========     ========
</TABLE>

     The net valuation allowance decreased by $8,522,000 and $1,019,000 during
the years ended June 30, 2000 and 1999, respectively.

     As of June 30, 2000, Extreme had net operating loss carryforwards for state
tax purposes of approximately $7,500,000. Extreme also had federal and state
research and development tax credit carryforwards of approximately $1,000,000
and $1,800,000, respectively. The state net operating loss carryforwards will
expire in 2004, if not utilized.

     Utilization of the net operating losses and tax credits may be subject to a
substantial annual limitation due to the ownership change limitations provided
by the Internal Revenue Code of 1986, as amended, and similar state provisions.
The annual limitation may result in the expiration of net operating losses and
tax credits before utilization.

7)   Comprehensive Income (Loss)

     The following are the components of accumulated other comprehensive loss,
net of tax (in thousands):

<TABLE>
<CAPTION>
                                                                                          Years Ended June 30,
                                                                                          --------------------
                                                                                     2000         1999         1998
                                                                                     ----         -----        ----
     <S>                                                                             <C>          <C>          <C>
</TABLE>

                                      48
<PAGE>

<TABLE>
     <S>                                                                             <C>          <C>          <C>
     Unrealized gain (loss) on investments......................................     $  (615)     $  (112)     $   --
     Foreign currency translation adjustments...................................          (8)          (6)         --
                                                                                     -------      -------      ------
        Accumulated other comprehensive loss....................................     $  (623)     $  (118)     $   --
                                                                                     =======      =======      ======
</TABLE>

     The following schedule of other comprehensive income (loss) shows the gross
current-period gain (loss) and the reclassification adjustment (in thousands):

<TABLE>
<CAPTION>
                                                                                          Years Ended June 30,
                                                                                          --------------------
                                                                                     2000         1999         1998
                                                                                     ----         -----        ----
     <S>                                                                            <C>          <C>          <C>
     Unrealized gain (loss) on investments:
        Unrealized gain (loss) on available-for-sale securities.................    $ (508)      $ (112)      $   --
        Less: reclassification adjustment for gain (loss) realized in
               net income (loss)................................................         5           --           --
                                                                                    ------       ------       ------
     Net unrealized gain (loss) on investments..................................      (503)        (112)          --
     Foreign currency translation adjustments...................................        (2)          (6)          --
                                                                                    ------       ------       ------
     Other comprehensive income (loss)..........................................    $ (505)      $ (118)      $   --
                                                                                    ======       ======       ======
</TABLE>

8)  401(k) Plan

     Extreme provides a tax-qualified employee savings and retirement plan,
commonly known as a 401(k) plan, which covers our eligible employees. Pursuant
to the 401(k) plan, employees may elect to reduce their current annual
compensation up to the lesser of 20% or the statutorily prescribed limit, which
is $10,000 in calendar year 2000, and have the amount of the reduction
contributed to the 401(k) plan.

9)  Subsequent Event

     On July 19, 2000 Extreme announced a two-for-one stock split in the form of
a stock dividend to be paid on August 24, 2000 to stockholders of record on
August 10, 2000. All share and per share data have been restated to give
retroactive effect to this stock split.

Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.

     Not applicable.

                                   PART III

     Certain information required by Part III is incorporated by reference from
the Company's definitive Proxy Statement to be filed with the Securities and
Exchange Commission in connection with the solicitation of proxies for the
Company's 2000 Annual Meeting of Stockholders (the "Proxy Statement").

Item 10. Directors and Executive Officers of the Registrant.

     The information required by this section is incorporated by reference from
the information in the section entitled "Proposal 1-Election of Directors" in
the Proxy Statement. The required information concerning executive officers of
the Company is contained in the section entitled "Executive Officers of the
Registrant" in Part I of this Form 10-K.

     Item 405 of Regulation S-K calls for disclosure of any known late filing or
failure by an insider to file a report required by Section 16 of the Exchange
Act. This disclosure is contained in the section entitled "Section 16(a)
Beneficial Ownership Reporting Compliance" in the Proxy Statement and is
incorporated herein by reference.

Item 11. Executive Compensation.

     The information required by this section is incorporated by reference from
the information in the sections entitled "Proposal 1-Election of Directors --
Directors' Compensation", "Executive Compensation" and "Stock Price Performance
Graph" in the Proxy Statement.

                                      49
<PAGE>

Item 12. Security Ownership of Certain Beneficial Owners and Management.

     The information required by this section is incorporated by reference from
the information in the section entitled "Proposal 1- Election of Directors-
Security Ownership of Certain Beneficial Owners and Management" in the Proxy
Statement.

Item 13. Certain Relationships and Related Transactions.

     The information required by this section is incorporated by reference from
the information in the section titled "Certain relationships and related
transactions" in the Proxy statement.

                                    PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.

(a)  The following documents are filed as a part of this Form 10-K:

     (1)  Financial Statements:

          Reference is made to the Index to Consolidated Financial Statements of
     Extreme Networks, Inc. under Item 8 in Part II of this Form 10-K.

     (2)  Financial Statement Schedules:

          The following financial statement schedule of Extreme Networks, Inc.
     for the years ended June 30, 2000, 1999 and 1998 is filed as part of this
     Report and should be read in conjunction with the Consolidated Financial
     Statements of Extreme Networks, Inc.

                                                                       Reference
                                                                          Page

Schedule II-- Valuation and Qualifying Accounts.......................     52

     All other schedules are omitted because they are not applicable or the
required information is shown in the financial statements or notes thereto.

     (3)  Exhibits:

          The exhibits listed below are required by Item 601 of Regulation S-K.
     Each management contract or compensatory plan or arrangement required to be
     filed as an exhibit to this Form 10-K has been identified.

   Exhibit
   Number    Notes                      Description of Document
  ---------  -----                      -----------------------
    2.1       (1)     Form of Agreement and Plan of Merger between Extreme
                      Networks, a California corporation, and Extreme Networks,
                      Inc., a Delaware corporation.
    3.1       (1)     Certificate of Incorporation of Extreme Networks, Inc., a
                      Delaware Corporation.
    3.2       (1)     Form of Certificate of Amendment of Certificate of
                      Incorporation of Extreme Networks, Inc., a Delaware
                      Corporation.
    3.3       (1)     Form of Amended and Restated Bylaws of Extreme Networks,
                      Inc., a Delaware Corporation.
    4.1       (1)     Second Amended and Restated Rights Agreement dated January
                      12, 1998 between Extreme Network and certain stockholders.
   10.1       (1)     Form of Indemnification Agreement for directors and
                      officers.
   10.2       (1)     Amended 1996 Stock Option Plan and forms of agreements
                      thereunder.*
   10.3       (1)     1999 Employee Stock Purchase Plan.*
   10.4       (1)     Sublease, dated June 5, 1997 between NetManage, Inc. and
                      Extreme Networks, Inc., a California corporation, to
                      Master Lease, dated September 30, 1994, between Cupertino
                      Industrial Associates and NetManage, Inc.
   10.5       (1)     Sublease, dated January 1, 1999 between Apple Computer,
                      Inc., a California corporation, and Extreme Networks,
                      Inc., a California corporation, to Lease Agreement, as
                      amended.

                                      50
<PAGE>

   10.6               Form of Warrant to Purchase Common Stock between 3Com
                      Corporation and Extreme Networks, Inc.
   10.7               Form of 2000 Nonstatutory Stock Option Plan.*
   10.8               Form of Lease Agreement (Land) dated June 1, 2000 by and
                      between BNP Leasing Corporation, a Delaware corporation
                      ("BNPLC") and Extreme Networks, Inc. a Delaware
                      corporation ("Extreme").
   10.9               Form of Lease Agreement (Improvements) dated June 1, 2000,
                      executed by and between BNPLC and Extreme.
   10.10              Form of Purchase Agreement (Land) dated to be effective as
                      of June 1, 2000, executed by and between BNPLC and
                      Extreme.
   10.11              Form of Purchase Agreement (Improvements) dated to be
                      effective as of June 1, 2000, executed by and between
                      BNPLC and Extreme.
   10.12              Form of Pledge Agreement (Land) dated to be effective as
                      of June 1, 2000, among BNPLC, BNP Paribas (as Agent), and
                      Extreme.
   10.13              Form of Pledge Agreement (Improvements) dated to be
                      effective as of June 1, 2000, among BNPLC, BNP Paribas (as
                      Agent), and Extreme.
   21.1               Subsidiaries of Registrant.
   23.1               Consent of Ernst and Young LLP, Independent Auditors.
   24.1               Power of Attorney (see page 53 of this Form 10-K).
   27.1               Financial Data Schedule (available in EDGAR format only).

_____________

*    Indicates management contract or compensatory plan or arrangement.

(1)  Incorporated by reference from the Registrant's Registration Statement on
Form S-1 (File No. 333-71921).

(b)  Reports on Form 8-K:

     No reports on form 8-K were filed by the Company during the three months
ended June 30, 2000.

                                      51
<PAGE>

                                  SCHEDULE II

                       VALUATION AND QUALIFYING ACCOUNTS
                   YEARS ENDED JUNE 30, 2000, 1999 AND 1998
                                (In thousands)

<TABLE>
<CAPTION>
                                                                Reversals
                                  Balance at     Charged to     to costs                      Balance at
                                   beginning      costs and        and                         end of
          Description              of period      expenses      expenses     (Deductions)      period
          -----------            ------------   ------------   ----------   --------------   -----------
<S>                              <C>            <C>            <C>          <C>              <C>
Allowance for doubtful accounts
  2000.........................     $1,374         $   --         $ --         $ (137)        $  1,237
  1999.........................        433          1,364           --           (423)           1,374
  1998.........................         --            470           --            (37)             433
</TABLE>

                                      52
<PAGE>

                                  SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, on September 28, 2000.

                                        EXTREME NETWORKS, INC.
                                        (Registrant)

                                        By:         /s/ GORDON L. STITT
                                           -------------------------------------
                                                        Gordon L. Stitt
                                                          President
                                                    Chief Executive Officer
                                                     Chairman of the Board
                                                       September 28, 2000

                               POWER OF ATTORNEY

     KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Gordon L. Stitt and Vito E. Palermo, and
each of them, his or her true and lawful attorneys-in-fact, each with full power
of substitution, for him or her in any and all capacities, to sign any
amendments to this report on Form 10-K and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming all that each of said
attorneys-in-fact or their substitute or substitutes may do or cause to be done
by virtue hereof.

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the date indicated:

<TABLE>
<S>                                                   <C>
          /s/ GORDON L. STITT                                      /s/ PROMOD HAQUE
-----------------------------------------------       -----------------------------------------------
              Gordon L. Stitt                                          Promod Haque
     President, Chief Executive Officer                                   Director
           Chairman of the Board                                     September 28, 2000
            September 28, 2000

         /s/ VITO E. PALERMO                                      /s/ LAWRENCE K. ORR
-----------------------------------------------       -----------------------------------------------
             Vito E. Palermo                                          Lawrence K. Orr
   Vice President & Chief Financial Officer                               Director
 (Principal Financial and Accounting Officer)                        September 28, 2000
            September 28, 2000

          /s/ CHARLES CARINALLI                                      /s/ PETER WOLKEN
-----------------------------------------------       -----------------------------------------------
              Charles Carinalli                                          Peter Wolken
                  Director                                                 Director
             September 28, 2000                                       September 28, 2000
</TABLE>

                                      53
<PAGE>

                                 EXHIBIT INDEX

  Exhibit
  Number     Notes                   Description of Document
 ---------   -----                   -----------------------
    2.1       (1)     Form of Agreement and Plan of Merger between Extreme
                      Networks, a California corporation, and Extreme Networks,
                      Inc., a Delaware corporation.
    3.1       (1)     Certificate of Incorporation of Extreme Networks, Inc., a
                      Delaware Corporation.
    3.2               Form of Certificate of Amendment of Certificate of
                      Incorporation of Extreme Networks, Inc., a Delaware
              (1)     Corporation.
    3.3       (1)     Form of Amended and Restated Bylaws of Extreme Networks,
                      Inc., a Delaware Corporation.
    4.1       (1)     Second Amended and Restated Rights Agreement dated January
                      12, 1998 between Extreme Network and certain stockholders.
   10.1       (1)     Form of Indemnification Agreement for directors and
                      officers.
   10.2       (1)     Amended 1996 Stock Option Plan and forms of agreements
                      thereunder.*
   10.3       (1)     1999 Employee Stock Purchase Plan.*
   10.4       (1)     Sublease, dated June 5, 1997 between NetManage, Inc. and
                      Extreme Networks, Inc., a California corporation, to
                      Master Lease, dated September 30, 1994, between Cupertino
                      Industrial Associates and NetManage, Inc.
   10.5       (1)     Sublease, dated January 1, 1999 between Apple Computer,
                      Inc., a California corporation, and Extreme Networks,
                      Inc., a California corporation, to Lease Agreement, as
                      amended.
   10.6               Form of Warrant to Purchase Common Stock between 3Com
                      Corporation and Extreme Networks, Inc.
   10.7               Form of 2000 Nonstatutory Stock Option Plan.*
   10.8               Form of Lease Agreement (Land) dated June 1, 2000 by and
                      between BNP Leasing Corporation, a Delaware corporation
                      ("BNPLC") and Extreme Networks, Inc. a Delaware
                      corporation ("Extreme").
   10.9               Form of Lease Agreement (Improvements) dated June 1, 2000,
                      executed by and between BNPLC and Extreme.
   10.10              Form of Purchase Agreement (Land) dated to be effective as
                      of June 1, 2000, executed by and between BNPLC and
                      Extreme.
   10.11              Form of Purchase Agreement (Improvements) dated to be
                      effective as of June 1, 2000, executed by and between
                      BNPLC and Extreme.
   10.12              Form of Pledge Agreement (Land) dated to be effective as
                      of June 1, 2000, among BNPLC, BNP Paribas (as Agent), and
                      Extreme.
   10.13              Form of Pledge Agreement (Improvements) dated to be
                      effective as of June 1, 2000, among BNPLC, BNP Paribas (as
                      Agent), and Extreme.
   21.1               Subsidiaries of Registrant.
   23.1               Consent of Ernst and Young LLP, Independent Auditors.
   24.1               Power of Attorney (see page 53 of this Form 10-K).
   27.1               Financial Data Schedule (available in EDGAR format only).

____________

*    Indicates management contract or compensatory plan or arrangement.

(1)  Incorporated by reference from the Registrant's Registration Statement on
Form S-1 (File No. 333-71921).
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.6
<SEQUENCE>2
<FILENAME>0002.txt
<DESCRIPTION>FORM OF WARRANT TO PURCHASE COMMON STOCK BETWEEN 3COM
<TEXT>

<PAGE>

                                                                    EXHIBIT 10.6

                                    WARRANT

                                                               WARRANT NO.   2
                                                                           -----

               THIS WARRANT OR THE SHARES ISSUABLE HEREUNDER HAVE NOT
          BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
          AMENDED. THIS WARRANT, OR THE SHARES ISSUABLE HEREUNDER, MAY
          NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
          REGISTRATION STATEMENT UNDER SAID ACT OR THE AVAILABILITY OF
          AN EXEMPTION FROM REGISTRATION THEREUNDER.

                            EXTREME NETWORKS, INC.

                       WARRANT TO PURCHASE COMMON STOCK
                           Void after April 3, 2002

          This certifies that, for value received, 3Com Corporation or
registered assigns ("Holder") is entitled, subject to the terms set forth below,
to purchase from Extreme Networks, Inc. (the "Company"), a Delaware corporation,
1,500,000 shares (such number of shares being referred to herein as the
"Original Amount") of the Common Stock of the Company (the "Common Stock"), as
constituted on the date hereof (the "Warrant Issue Date"), upon surrender
hereof, at the principal office of the Company referred to below, with the
notice of exercise form attached hereto duly executed, and simultaneous payment
therefor in lawful money of the United States or otherwise as hereinafter
provided, at the Exercise Price as set forth in Section 2 below. The Original
Amount, character and Exercise Price of such shares of Common Stock are subject
to adjustment as provided below. The term "Warrant" as used herein shall include
this Warrant, and any warrants delivered in substitution or exchange therefor as
provided herein.

          1.   Term of Warrant.
               ---------------

               (a)  Subject to the terms and conditions set forth herein and
compliance with any applicable regulatory requirements, this Warrant shall be
exercisable, in whole or in part, at any time during the term commencing on
April 3, 2000 and ending at 5:00 p.m., Pacific standard time, on April 3, 2002
(the "Expiration Date"), and, except as otherwise provided herein, shall be void
thereafter. This Warrant shall expire earlier upon the closing of an event in
which more than fifty percent (50%) of the Company's assets or capital stock is
acquired by or merged into another corporation that is not under direct or
indirect control of the persons who are the shareholders of the Company
immediately prior to such acquisition or merger, provided that Holder is given
at least 20 days prior written notice of such acquisition or merger in which to
exercise this Warrant in advance of its expiration.

               (b)  In the event that the Expiration Date of this Warrant
falls on a day which is not a Business Day, the Expiration Date shall be
adjusted to the Business Day immediately following such Expiration Date. As used
herein, the term "Business Day" means each day other
<PAGE>

than a Saturday, Sunday or other day on which banks in the location of the
principal office of the Company are legally authorized to close.

     2.   Exercise Price. The Exercise Price at which this Warrant may be
          --------------
exercised shall be $79.00 per share of Common Stock, as adjusted from time to
time pursuant to Section 11 hereof (the "Exercise Price").



     3.   Exercise of Warrant.
          -------------------

          (a)  The purchase rights represented by this Warrant are exercisable
by the Holder in whole or in part subject to compliance with applicable
regulatory requirements, at any time and from time to time, during the term
hereof as described in Section 1 above, by the surrender of this Warrant and the
Notice of Exercise annexed hereto duly completed and executed on behalf of the
Holder, at the office of the Company (or such other office or agency of the
Company as it may designate by notice in writing to the Holder at the address of
the Holder appearing on the books of the Company), upon payment (i) in cash or
by check acceptable to the Company, (ii) by cancellation by the Holder of
indebtedness of the Company to the Holder, or (iii) by a combination of (i) and
(ii), of an amount equal to the then applicable Exercise Price per share
multiplied by the number of shares then being purchased. For so long as the
Company remains a publicly listed company, the Holder may pay the Exercise Price
of the Warrant (i) by surrendering to the Company shares of the Company's Common
Stock having a value equal to the Exercise Price of the Warrant being exercised
or (ii) by directing the Company to apply toward payment of the Exercise Price
from the number of shares of the Common Stock for which the Warrant is being
exercised, shares of the Common Stock having a value equal to the Exercise Price
of the Warrant being exercised. For purposes of this Section 3, the value of
each share of Common Stock shall be the average of the daily closing prices of
the Common Stock for the five consecutive Trading Days ending on the Trading Day
preceding the date of such exercise. As used herein the term "Trading Days" with
respect to Common Stock means (i) if the Common Stock is quoted on the NASDAQ
Stock Markets, Inc. any similar system of automated dissemination of quotations
of securities prices, days on which trades may be made on such system or (ii) if
the Common Stock is listed or admitted for trading on any national securities
exchange, days on which such national securities exchange is open for business.

          (b)  This Warrant shall be deemed to have been exercised immediately
prior to the close of business on the date of its surrender for exercise as
provided above, and the person entitled to receive the shares of Common Stock
issuable upon such exercise shall be treated for all purposes as the holder of
record of such shares as of the close of business on such date. As promptly as
practicable on or after such date and in any event within ten (10) days
thereafter, the Company, at its expense, shall issue and deliver to the person
or persons entitled to receive the same a certificate or certificates for the
number of shares issuable upon such exercise. In the event that this Warrant is
exercised in part, the Company, at its expense, will execute and deliver a new
Warrant of like tenor exercisable for the number of shares for which this
Warrant may then be exercised.

                                      -2-
<PAGE>

     4.   Fractional Shares. No fractional shares will be issued in connection
          -----------------
with any exercise of this Warrant, and the number of shares to which the Holder
is entitled upon exercise of this Warrant shall be rounded down to the nearest
whole number.

     5.   Replacement of Warrant. On receipt of evidence reasonably
          ----------------------
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of loss, theft or destruction, on delivery of an
indemnity agreement reasonably satisfactory in form and substance to the Company
or, in the case of mutilation, on surrender and cancellation of this Warrant,
the Company at its expense shall execute and deliver, in lieu of this Warrant, a
new warrant of like tenor and amount.

     6.   No Rights as Stockholder. Subject to Sections 9 and 11 of this
          ------------------------
Warrant, the Holder shall not be entitled to vote or receive dividends pursuant
to this Warrant or be deemed the holder of Common Stock pursuant to this
Warrant, nor shall anything contained herein be construed to confer upon the
Holder, as such, any of the rights of a stockholder of the Company or any right
to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action (whether upon any recapitalization, issuance of stock,
reclassification of stock, change of par value, or change of stock to no par
value, consolidation, merger, conveyance, or otherwise) or to receive notice of
meetings, or to receive dividends or subscription rights or otherwise until the
Warrant shall have been exercised as provided herein.

     7.   Transfer of Warrant. As this warrant is issued in furtherance of the
          -------------------
relationship between the Company and the initial Holder, this warrant may not be
transferred without the written approval of the Company, which consent may be
withheld for any reason.

          (a)  The Company will maintain a register (the "Warrant Register")
containing the names and addresses of the Holder or Holders. Any Holder of this
Warrant or any portion thereof may change his address as shown on the Warrant
Register by written notice to the Company requesting such change. Any notice or
written communication required or permitted to be given to the Holder may be
delivered or given by mail to such Holder as shown on the Warrant Register and
at the address shown on the Warrant Register. Until this Warrant is transferred
on the Warrant Register of the Company, the Company may treat the Holder as
shown on the Warrant Register as the absolute owner of this Warrant for all
purposes, notwithstanding any notice to the contrary.

          (b)  The Company may, by written notice to the Holder, appoint an
agent for the purpose of maintaining the Warrant Register referred to in Section
7(a) above, issuing the Common Stock or other securities then issuable upon the
exercise of this Warrant, exchanging this Warrant, replacing this Warrant, or
any or all of the foregoing. Thereafter, any such registration, issuance,
exchange, or replacement, as the case may be, shall be made at the office of
such agent.

          (c)  This Warrant may not be transferred or assigned in whole or in
part without compliance with applicable federal and state securities laws by the
transferor and the transferee. Subject to the provisions of this Warrant with
respect to compliance with the Securities Act of 1933, as amended (the "Act"),
title to this Warrant may be transferred by

                                      -3-
<PAGE>

endorsement (by the Holder executing the Assignment Form annexed hereto) and
delivery in the same manner as a negotiable instrument transferable by
endorsement and delivery.

          (d)  On surrender of this Warrant for exchange, properly endorsed on
the Assignment Form and subject to the provisions of this Warrant with respect
to compliance with the Act and with the limitations on assignments and transfers
contained in this Section 7, the Company at its expense shall issue to or on the
order of the Holder a new warrant or warrants of like tenor, in the name of the
Holder or as the Holder (on payment by the Holder of any applicable transfer
taxes) may direct, for the number of shares issuable upon exercise hereof.

          (e)  The Holder of this Warrant, by acceptance hereof, acknowledges
that the Holder will not offer, sell or otherwise dispose of this Warrant or any
shares of Common Stock to be issued upon exercise hereof except in compliance
with the registration requirements of the Act, subject, nevertheless, to the
disposition of the Holder's property being at all times within its control.

          (f)  This Warrant and all shares of Common Stock issued upon exercise
hereof (unless registered under the Act) shall be stamped or imprinted with a
legend in substantially the following form:

          THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
          UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH
          SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
          AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT OR THE
          AVAILABILITY OF AN EXEMPTION FROM REGISTRATION THEREUNDER.

     8.   Reservation of Stock; Stock Fully Paid. The Company covenants that
          --------------------------------------
during the term this Warrant is exercisable, the Company will reserve from its
authorized and unissued Common Stock a sufficient number of shares to provide
for the issuance of Common Stock upon the exercise of this Warrant and, from
time to time, will take all steps necessary to amend its Certificates of
Incorporation (the "Certificates") to provide sufficient reserves of shares of
Common Stock issuable upon exercise of the Warrant and will refrain from
effecting any amendment to the Certificates which in any manner would affect the
rights or privileges of the holders of its Common Stock. The Company further
covenants that all shares that may be issued upon the exercise of rights
represented by this Warrant, upon exercise of the rights represented by this
Warrant and payment of the Exercise Price, all as set forth herein, will be duly
authorized, validly issued, fully paid and nonassessable, and free from all
taxes, liens and charges in respect of the issue thereof (other than taxes in
respect of any transfer occurring contemporaneously). The Company agrees that
its issuance of this Warrant shall constitute full authority to its officers who
are charged with the duty of executing stock certificates to execute and issue
the necessary certificates for shares of Common Stock upon the exercise of this
Warrant.

     9.   Notices.
          -------

                                      -4-
<PAGE>

          (a)  Whenever the Exercise Price or number of shares purchasable
hereunder shall be adjusted pursuant to Section 11 hereof, the Company shall
issue a certificate signed by its chief financial officer setting forth, in
reasonable detail, the event requiring the adjustment, the amount of the
adjustment, the method by which such adjustment was calculated, and the Exercise
Price and number of shares purchasable hereunder after giving effect to such
adjustment, and shall cause a copy of such certificate to be mailed (by first-
class mail, postage prepaid) to the Holder of this Warrant.

          (b)  In case: (i) the Company shall take a record of the holders of
its Common Stock (or other stock or securities at the time receivable upon the
exercise of this Warrant) for the purpose of entitling them to receive any
dividend or other distribution, or any right to subscribe for or purchase any
shares of stock of any class or any other securities, or to receive any other
right, or

               (ii)  of any capital reorganization of the Company, any stock
split or subdivision, or reverse stock split or combination, or any similar
event involving the Common Stock, any reclassification of the capital stock of
the Company, any consolidation or merger of the Company with or into another
corporation, or any sale, transfer or other conveyance of all or substantially
all of the assets of the Company to another corporation, or

               (iii) of any voluntary dissolution, liquidation or winding-up of
the Company, then, and in each such case, the Company will mail or cause to be
mailed to the Holder or Holders a notice specifying, as the case may be, (A) the
date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (B) the date on which a record is to be taken for
determining stockholders entitled to vote upon such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding-up is to take place, and the time, if any is to be fixed, as of which
the holders of record of Common Stock (or such stock or securities at the time
receivable upon the exercise of this Warrant) shall be entitled to exchange
their shares of Common Stock (or such other stock or securities) for securities
or other property deliverable upon such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding-up. Such
notice shall be mailed at least 10 days prior to the date therein specified.

          (c)  All such notices, advices and communications shall be deemed to
have been received (i) in the case of personal delivery, on the date of such
delivery and (ii) in the case of mailing, on the third business day following
the date of such mailing.

     10.  Amendments.
          ----------

          (a)  This Warrant and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party
against which enforcement of such change, waiver, discharge or termination is
sought.

                                      -5-
<PAGE>

          (b)  No waivers of, or exceptions to, any term, condition or provision
of this Warrant, in any one or more instances, shall be deemed to be, or
construed as, a further or continuing waiver of any such term, condition or
provision.

     11.  Adjustments.
          -----------

          (a)  The Exercise Price and the number of shares purchasable hereunder
shall be subject to adjustment from time to time as follows:

               (i)  The Exercise Price shall be adjusted from time to time in
the case of any stock split, subdivision of the number of shares of the Common
Stock or similar event involving Common Stock (a "Split") or any reverse stock
split, combination or similar event involving the Common Stock (a "Combination")
and, accordingly, the Exercise Price shall be proportionately decreased in the
case of a Split or increased in the case of a Combination, as of the close of
business on the date the Split or Combination becomes effective, computed to the
nearest cent.

               (ii) In case of any reclassification or change of outstanding
shares of Common Stock (except a split or combination, or a change in par value,
or a change from par value to no par value, or a change from no par value to par
value), or in case of any consolidation or merger to which the Company is a
party (other than a consolidation or merger that results in the termination of
this Warrant under Section 1 or in which the Company is the surviving
corporation and which does not result in any reclassification of or change in
the outstanding Common Stock of the Company) or any sale, transfer or other
conveyance of all or substantially all of the Company's assets, the Company, or
its successor, as the case may be, shall assume, by written instrument executed
and delivered to the registered holder of this Warrant at such Holder's address
shown on the registration books of the Company the obligation to deliver to the
Holder of this Warrant, upon due exercise thereof, the kind and amount of stock
and other securities and property receivable upon such reclassification, change,
consolidation, merger, sale, transfer or conveyance by a Holder of the number of
shares which would have been issued to such Holder had this Warrant been
exercised immediately prior thereto.

               As evidence of the kind and amount of stock or other securities
or property which shall be issuable upon the exercise of this Warrant after any
such reclassification, change, consolidation, merger, sale, transfer or
conveyance, the Company shall maintain in its records at its principal office a
certificate of any firm of independent public accountants (who may be the
regular auditors retained by the Company) with respect thereto.

               The provisions of this clause (ii) shall similarly apply to
successive reclassifications, changes, consolidations, mergers, sales, transfers
or conveyances.

               Upon any adjustment of the Exercise Price herein above provided
for, the number of shares issuable upon exercise of this Warrant shall be
changed to the number of shares calculated to the next highest whole share
obtained by dividing (A) the aggregate Exercise Price payable for the purchase
of all shares issuable upon exercise prior to such adjustment by (B) the
Exercise Price in effect immediately after such adjustment.

                                      -6-
<PAGE>

               (iii)  Whenever the Exercise Price or the number of shares
purchasable upon the exercise of this Warrant is adjusted as herein provided,
the Company shall:

                      (A)  forthwith place on file at its office a certificate
signed by the chief financial officer of the Company, showing in appropriate
detail the facts requiring such adjustment, the computation thereof, the
Exercise Price after such adjustment, and the number of shares purchasable upon
the exercise of this Warrant after such adjustment with respect to each share
originally purchasable upon exercise hereof, and shall exhibit the same from
time to time to any holder of this Warrant desiring an inspection thereof, and

                      (B)  within ten (10) days thereafter cause a notice to be
mailed to the Holder hereof at its address shown in the registration books of
the Company stating that such adjustment has been effected and the adjusted
Exercise Price and the number of shares purchasable as aforesaid.

               (iv)   Irrespective of any adjustments in the Exercise Price or
the number of shares or the number or kind of other securities purchasable upon
exercise of this Warrant, this Warrant or any Warrant thereafter issued may
continue to express the same price and number and kind of shares as are stated
in the Warrants initially issued by the Company.

          (b)  In the event that the Company (i) issues as a dividend or other
similar distribution (an "Extraordinary Dividend") on all of its then
outstanding Common Stock, (A) securities of the Company of a class other than
Common Stock, (B) rights, warrants or options (individually, a "Right" and
collectively, the "Rights") to acquire any securities of the Company (including
Common Stock) or (C) evidences of its indebtedness or assets (any securities
(other than Rights) issued as an Extraordinary Dividend or issued upon exercise
of any Rights issued as an Extraordinary Dividend shall be referred to as
"Dividend Securities"):

               (x)    this Warrant shall thereafter be exercisable for (1) the
Original Amount of shares of Common Stock (subject to adjustment as herein
provided), (2) such Dividend Securities and Rights as would theretofore have
been issued in respect of such shares (adjusted as herein provided) had such
shares been outstanding at the time of such Extraordinary Dividend; and

               (y)    any Right issued as an Extraordinary Dividend shall (1)
expire upon the later of (a) the original expiration date of such Right or (b)
the 180th day following the exercise of this Warrant, and (2) be exercisable for
the Dividend Securities issuable upon exercise of such Right.

          (c)  In the event that at any time while this Warrant is outstanding,
the Company shall offer to sell to all of the holders of Common Stock as a
class, rights or options to purchase Common Stock or rights or options to
purchase any stock or securities convertible into or exchangeable for Common
Stock (such exchangeable or convertible stock or securities being herein called
"Convertible Securities"), whether or not such rights or options are immediately
exercisable, and the price per share for which Common Stock is issuable upon the
exercise of such rights or options or upon conversion or exchange of such
Convertible Securities (determined by dividing (i) the total amount received or
receivable by the Company upon

                                      -7-
<PAGE>

issuance and sale of such rights or options, plus the aggregate amount of
additional consideration payable to the Company upon the exercise of all such
rights or options, plus, in the case of rights or options which relate to
Convertible Securities, the aggregate amount of additional consideration, if
any, payable upon the conversion or exchange of all such Convertible Securities,
by (ii) the total maximum number of shares of Common Stock issuable upon the
exercise of all such rights or options or upon the conversion or exchange of all
such Convertible Securities issuable upon the exercise of all such rights or
options) shall be less than the Exercise Price in effect immediately prior to
the initial sale of any such rights or options, the Company shall offer to sell
to the Holder, at the price and upon the terms at which such rights or options
are offered to holders of its Common Stock, such number of such rights or
options as the Holder would have been entitled to purchase had the Holder
exercised this Warrant immediately prior to the commencement of the offering of
such rights or options.

          (d)  If any event occurs as to which in the opinion of the Board of
Directors of the Company the other provisions of this Section 11 are not
strictly applicable or if strictly applicable would not adequately protect from
dilution the exercise rights of the Holder in accordance with the intent and
principles of such provisions, then the Board of Directors of the Company shall
make an equitable adjustment in the application of such provisions, in
accordance with such intent and principles of such provisions, so as to protect
such exercise rights as aforesaid, but in no event shall such adjustment have
the effect of increasing the Exercise Price.

     12.  Taxes. The issue of any stock or other certificate upon the exercise
          -----
of this Warrant shall be made without charge to the Holder for any documentary,
stamp or similar tax in respect of the issue of such stock or certificate.

     13.  Valid Issuance. Company represents to Holder that this Warrant and the
          --------------
shares of Common Stock issuable upon the exercise of this Warrant have been duly
authorized by all necessary corporate actions, this Warrant has been duly
executed and delivered and constitutes a legally binding agreement of the
Company enforceable in accordance with the terms hereof, the Company has
reserved out of its authorized and unissued shares of Common Stock a number of
shares sufficient to provide for the exercise of the rights represented by this
Warrant, and the shares of Common Stock issuable upon exercise of this Warrant,
when issued in accordance with the terms hereof, will be validly issued, fully
paid and nonassessable.

     14.  Registration Rights. The Company hereby undertakes to use its best
          -------------------
efforts to grant "piggy back" registration rights to the Holder, entitling the
Holder to include in a registration statement filed by the Company with the
Securities Exchange Commission the shares issuable upon exercise of this
Warrant. Such rights shall be on the same terms as certain existing holders of
the Company's common stock held pursuant to the Company's registration rights
agreement with its investors, and may require amendment of such agreement, which
amendment the Company will seek to obtain immediately following the issuance of
this Warrant.

     15.  Governing Law.  This Warrant shall be governed by, construed, and
          -------------
enforced in accordance with the laws of the State of Delaware without reference
to its principles of conflicts of law.

                                      -8-
<PAGE>

     IN WITNESS WHEREOF, Extreme Networks, Inc. has caused this Warrant to be
executed by its officers thereunto duly authorized.

Dated as of: April 3, 2000



                                             EXTREME NETWORKS, INC.


                                             By:_____________________________

                                      -9-
<PAGE>

                              NOTICE OF EXERCISE

To: Extreme Networks, Inc.

          (1)  The undersigned hereby elects to purchase ______ shares of Common
Stock of Extreme Networks, Inc., pursuant to the terms of the attached Warrant,
and tenders herewith payment of the purchase price for such shares in full.

          (2)  Please issue a certificate or certificates representing said
shares of Common Stock in the name of the undersigned or in such other name as
is specified below:


                       ________________________________
                                    (Name)



                       ________________________________
                                   (Address)


          (3)  Please issue a new Warrant for the unexercised portion of the
attached Warrant in the name of the undersigned or in such other name as is
specified below:


                       ________________________________
                                    (Name)



____________________                         ___________________________________
(Date)                                       (Signature)
<PAGE>

                              FORM OF ASSIGNMENT

          FOR VALUE RECEIVED, the undersigned registered owner of this Warrant
hereby sells, assigns and transfers unto the Assignee named below all of the
rights of the undersigned under the within Warrant, with respect to the number
of shares of Common Stock set forth below:

Name of Assignee         Address        No. of Shares
----------------         -------        -------------










and does hereby irrevocably constitute and appoint Attorney _____________ to
make such transfer on the books of Extreme Networks, Inc., maintained for the
purpose, with full power of substitution in the premises.

Dated:__________________



                                             ________________________________
                                             Signature of Holder
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.7
<SEQUENCE>3
<FILENAME>0003.txt
<DESCRIPTION>FORM OF 2000 NONSTATUTORY STOCK OPTION PLAN
<TEXT>

<PAGE>

                                                                    EXHIBIT 10.7

                            EXTREME NETWORKS, INC.

                      2000 NONSTATUTORY STOCK OPTION PLAN


                   Establishment, Purpose and Term of Plan.
                   ---------------------------------------

          1.1  Establishment. The Company's 2000 Nonstatutory Stock Option Plan
(the "Plan") is established effective as of March ___, 2000.

          1.2  Purpose. The purpose of the Plan is to advance the interests of
the Participating Company Group and its stockholders by providing an incentive
to attract, retain and reward persons performing services for the Participating
Company Group and by motivating such persons to contribute to the growth and
profitability of the Participating Company Group.

          1.3  Term of Plan. The Plan shall continue in effect until the earlier
of its termination by the Board or the date on which all of the shares of Stock
available for issuance under the Plan have been issued and all restrictions on
such shares under the terms of the Plan and the agreements evidencing Options
granted under the Plan have lapsed.

                         Definitions and Construction.
                         -----------------------------

          2.1  Definitions. Whenever used herein, the following terms shall have
their respective meanings set forth below:

                    "Board" means the Board of Directors of the Company. If one
or more Committees have been appointed by the Board to administer the Plan,
"Board" also means such Committee(s).

                    "Code" means the Internal Revenue Code of 1986, as amended,
and any applicable regulations promulgated thereunder.

                    "Committee" means the Compensation Committee or other
committee of the Board duly appointed to administer the Plan and having such
powers as shall be specified by the Board. Unless the powers of the Committee
have been specifically limited, the Committee shall have all of the powers of
the Board granted herein, including, without limitation, the power to amend or
terminate the Plan at any time, subject to the terms of the Plan and any
applicable limitations imposed by law.

                    "Company" means Extreme Networks, Inc., a Delaware
corporation, or any successor corporation thereto.

                    "Consultant" means any person, including an advisor, engaged
by a Participating Company to render services other than as an Employee or a
director.

                    "Employee" means any person treated as an employee
(including an officer or a director who is also treated as an employee) in the
records of a Participating Company.

                    "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

                    "Fair Market Value" means, as of any date, the value of a
share of Stock or other property as determined by the Board, in its discretion,
or by the Company, in its discretion, if such determination is expressly
allocated to the Company herein, subject to the following:

          If, on such date, the Stock is listed on a national or regional
securities exchange or market system, the Fair Market Value of a share of Stock
shall be the closing price of a share of Stock (or the mean of the closing bid
and asked prices of a share of Stock if the
<PAGE>

Stock is so quoted instead) as quoted on the Nasdaq National Market, The Nasdaq
SmallCap Market or such other national or regional securities exchange or market
system constituting the primary market for the Stock, as reported in The Wall
                                                                     --------
Street Journal or such other source as the Company deems reliable. If the
--------------
relevant date does not fall on a day on which the Stock has traded on such
securities exchange or market system, the date on which the Fair Market Value
shall be established shall be the last day on which the Stock was so traded
prior to the relevant date, or such other appropriate day as shall be determined
by the Board, in its discretion.

     If, on such date, there is no public market for the Stock, the Fair Market
     Value of a share of Stock shall be as determined by the Board in good faith
     without regard to any restriction other than a restriction which, by its
     terms, will never lapse.

                    "Option" means a right to purchase Stock (subject to
adjustment as provided in Section 4.2) pursuant to the terms and conditions of
the Plan. Options are intended to be nonstatutory stock options and shall not be
treated as incentive stock options within the meaning of Section 422(b) of the
Code.

                    "Option Agreement" means a written agreement between the
Company and an Optionee setting forth the terms, conditions and restrictions of
the Option granted to the Optionee and any shares acquired upon the exercise
thereof.

                    "Optionee" means a person who has been granted one or more
Options.

                    "Parent Corporation" means any present or future "parent
corporation" of the Company, as defined in Section 424(e) of the Code.

                    "Participating Company" means the Company or any Parent
Corporation or Subsidiary Corporation.

                    "Participating Company Group" means, at any point in time,
all corporations collectively which are then Participating Companies.

                    "Stock" means the common stock, without par value, of the
Company, as adjusted from time to time in accordance with Section 4.2.

                    "Subsidiary Corporation" means any present or future
"subsidiary corporation" of the Company, as defined in Section 424(f) of the
Code.

          2.2  Construction. Captions and titles contained herein are for
convenience only and shall not affect the meaning or interpretation of any
provision of the Plan. Except when otherwise indicated by the context, the
singular shall include the plural and the plural shall include the singular. Use
of the term "or" is not intended to be exclusive, unless the context clearly
requires otherwise.

                                Administration.
                                --------------

          3.1  Administration by the Board. The Plan shall be administered by
the Board, including any duly appointed Committee of the Board. All questions of
interpretation of the Plan or of any Option shall be determined by the Board,
and such determinations shall be final and binding upon all persons having an
interest in the Plan or such Option. Any officer of a Participating Company
shall have the authority to act on behalf of the Company with respect to any
matter, right, obligation, determination or election which is the responsibility
of or which is allocated to the Company herein, provided the officer has
apparent authority with respect to such matter, right, obligation, determination
or election.

          3.2  Powers of the Board. In addition to any other powers set forth in
the Plan and subject to the provisions of the Plan, the Board shall have the
full and final power and authority, in its sole discretion:

                    to determine the persons to whom, and the time or times at
which, Options shall be granted and the number of shares of Stock to be subject
to each Option;

                    to determine the Fair Market Value of shares of Stock or
other property;
<PAGE>

                    to determine the terms, conditions and restrictions
applicable to each Option (which need not be identical) and any shares acquired
upon the exercise thereof, including, without limitation, (i) the exercise price
of the Option, (ii) the method of payment for shares purchased upon the exercise
of the Option, (iii) the method for satisfaction of any tax withholding
obligation arising in connection with the Option or such shares, including by
the withholding or delivery of shares of stock, (iv) the timing, terms and
conditions of the exercisability of the Option or the vesting of any shares
acquired upon the exercise thereof, (v) the time of the expiration of the
Option, (vi) the effect of the Optionee's termination of employment or service
with the Participating Company Group on any of the foregoing, and (vii) all
other terms, conditions and restrictions applicable to the Option or such shares
not inconsistent with the terms of the Plan;

                    to approve one or more forms of Option Agreement;

                    to amend, modify, extend, or renew, or grant a new Option in
substitution for, any Option or to waive any restrictions or conditions
applicable to any Option or any shares acquired upon the exercise thereof;

                    to accelerate, continue, extend or defer the exercisability
of any Option or the vesting of any shares acquired upon the exercise thereof,
including with respect to the period following an Optionee's termination of
employment or service with the Participating Company Group;

                    to prescribe, amend or rescind rules, guidelines and
policies relating to the Plan, or to adopt supplements to, or alternative
versions of, the Plan, including, without limitation, as the Board deems
necessary or desirable to comply with the laws of, or to accommodate the tax
policy or custom of, foreign jurisdictions whose citizens may be granted
Options; and

                    to correct any defect, supply any omission or reconcile any
inconsistency in the Plan or any Option Agreement and to make all other
determinations and take such other actions with respect to the Plan or any
Option as the Board may deem advisable to the extent consistent with the Plan
and applicable law.

                            Shares Subject to Plan.
                            ----------------------

          4.1  Maximum Number of Shares Issuable. Subject to adjustment as
provided in Section 4.2, the maximum aggregate number of shares of Stock that
may be issued under the Plan shall be 2,000,000 and shall consist of authorized
but unissued or reacquired shares of Stock or any combination thereof. If an
outstanding Option for any reason expires or is terminated or canceled or shares
of Stock acquired, subject to repurchase, upon the exercise of an Option are
repurchased by the Company, the shares of Stock allocable to the unexercised
portion of such Option, or such repurchased shares of Stock, shall again be
available for issuance under the Plan.

          4.2  Adjustments for Changes in Capital Structure. In the event of any
stock dividend, stock split, reverse stock split, recapitalization, combination,
reclassification or similar change in the capital structure of the Company,
appropriate adjustments shall be made in the number and class of shares subject
to the Plan, and to any outstanding Options and in the exercise price per share
of any outstanding Options. If a majority of the shares which are of the same
class as the shares that are subject to outstanding Options are exchanged for,
converted into, or otherwise become (whether or not pursuant to an Ownership
Change Event, as defined in Section 8.1) shares of another corporation (the "New
Shares"), the Board may unilaterally amend the outstanding Options to provide
that such Options are exercisable for New Shares. In the event of any such
amendment, the number of shares subject to, and the exercise price per share of,
the outstanding Options shall be adjusted in a fair and equitable manner as
determined by the Board, in its sole discretion. Notwithstanding the foregoing,
any fractional share resulting from an adjustment pursuant to this Section 4.2
shall be rounded up or down to the nearest whole number, as determined by the
Board, and in no event may the exercise price of any Option be decreased to an
amount less than the par value, if any, of the stock subject to the Option. The
adjustments determined by the Board pursuant to this Section 4.2 shall be final,
binding and conclusive.

             Eligibility. Options may be granted only to Employees and
 Consultants; provided, however, that no Option shall be granted to any person
(including any officer or director) whose eligibility to receive an Option under
   the Plan at the time of grant would require the approval of the Company's
  stockholders pursuant to any applicable law, regulation or rule, including,
    without limitation, any rule applicable to the listing of the Company's
    securities on the Nasdaq National Market. For purposes of the foregoing
sentence, "Employees"and "Consultants" shall include prospective Employees and
prospective Consultants to whom Options are granted in connection with written
 offers of an employment or other service relationship with the Participating
    Company Group. Eligible persons may be granted more than one (1) Option

             Terms and Conditions of Options. Options shall be evidenced by
 Option Agreements specifying the number of shares of Stock covered thereby, in
 such form as the Board shall from time to time establish. Option Agreements may
       incorporate all or any of the terms of the Plan by reference and
<PAGE>

    shall comply with and be subject to the following terms and conditions:

          6.1  Exercise Price. The exercise price for each Option shall be
established in the sole discretion of the Board; provided, however, that the
exercise price per share for an Option shall be not less than the Fair Market
Value of a share of Stock on the effective date of grant of the Option.
Notwithstanding the foregoing, an Option may be granted with an exercise price
lower than the minimum exercise price set forth above if such Option is granted
pursuant to an assumption or substitution for another option in a manner
qualifying under the provisions of Section 424(a) of the Code.

          6.2  Exercise Period. Options shall be exercisable at such time or
times, or upon such event or events, and subject to such terms, conditions,
performance criteria, and restrictions as shall be determined by the Board and
set forth in the Option Agreement evidencing such Option; provided, however,
that (a) no Option shall be exercisable after the expiration of ten (10) years
after the effective date of grant of such Option, and (b) no Option granted to a
prospective Employee or prospective Consultant may become exercisable prior to
the date on which such person commences service with a Participating Company.

          6.3  Payment of Exercise Price.

                    Forms of Consideration Authorized. Except as otherwise
provided below, payment of the exercise price for the number of shares of Stock
being purchased pursuant to any Option shall be made (i) in cash, by check, or
cash equivalent, (ii) by tender to the Company of shares of Stock owned by the
Optionee having a Fair Market Value (as determined by the Company without regard
to any restrictions on transferability applicable to such stock by reason of
federal or state securities laws or agreements with an underwriter for the
Company) not less than the exercise price, (iii) by the assignment of the
proceeds of a sale or loan with respect to some or all of the shares being
acquired upon the exercise of the Option (including, without limitation, through
an exercise complying with the provisions of Regulation T as promulgated from
time to time by the Board of Governors of the Federal Reserve System) (a
"Cashless Exercise"), (iv) by the Optionee's promissory note in a form approved
by the Company, (v) by such other consideration as may be approved by the Board
from time to time to the extent permitted by applicable law, or (vi) by any
combination thereof. The Board may at any time or from time to time, by adoption
of or by amendment to the standard form of Option Agreement described in Section
7, or by other means, grant Options which do not permit all of the foregoing
forms of consideration to be used in payment of the exercise price or which
otherwise restrict one or more forms of consideration.

                    Tender of Stock. Notwithstanding the foregoing, an Option
may not be exercised by tender to the Company of shares of Stock to the extent
such tender of Stock would constitute a violation of the provisions of any law,
regulation or agreement restricting the redemption of the Company's stock.
Unless otherwise provided by the Board, an Option may not be exercised by tender
to the Company of shares of Stock unless such shares either have been owned by
the Optionee for more than six (6) months or were not acquired, directly or
indirectly, from the Company.

                    Cashless Exercise. The Company reserves, at any and all
times, the right, in the Company's sole and absolute discretion, to establish,
decline to approve or terminate any program or procedures for the exercise of
Options by means of a Cashless Exercise.

                    Payment by Promissory Note. No promissory note shall be
permitted if the exercise of an Option using a promissory note would be a
violation of any law. Any permitted promissory note shall be on such terms as
the Board shall determine at the time the Option is granted. The Board shall
have the authority to permit or require the Optionee to secure any promissory
note used to exercise an Option with the shares of Stock acquired upon the
exercise of the Option or with other collateral acceptable to the Company.
Unless otherwise provided by the Board, if the Company at any time is subject to
the regulations promulgated by the Board of Governors of the Federal Reserve
System or any other governmental entity affecting the extension of credit in
connection with the Company's securities, any promissory note shall comply with
such applicable regulations, and the Optionee shall pay the unpaid principal and
accrued interest, if any, to the extent necessary to comply with such applicable
regulations.

          6.4  Tax Withholding. The Company shall have the right, but not the
obligation, to deduct from the shares of Stock issuable upon the exercise of an
Option, or to accept from the Optionee the tender of, a number of whole shares
of Stock having a Fair Market Value, as determined by the Company, equal to all
or any part of the federal, state, local and foreign taxes, if any, required by
law to be withheld by the Participating Company Group with respect to such
Option or the shares acquired upon the exercise thereof. Alternatively or in
addition, in its sole discretion, the Company shall have the right to require
the Optionee, through payroll withholding, cash payment or otherwise, including
by means of a Cashless Exercise, to make adequate provision for any such
<PAGE>

tax withholding obligations of the Participating Company Group arising in
connection with the Option or the shares acquired upon the exercise thereof. The
Company shall have no obligation to deliver shares of Stock or to release shares
of Stock from an escrow established pursuant to the Option Agreement until the
Participating Company Group's tax withholding obligations have been satisfied by
the Optionee.

                      Standard Forms of Option Agreement.
                      ----------------------------------

          7.1  General. Unless otherwise provided by the Board at the time the
Option is granted, an Option shall comply with and be subject to the terms and
conditions set forth in the form of Option Agreement adopted by the Board
concurrently with its adoption of the Plan and as amended from time to time.

          7.2  Authority to Vary Terms. The Board shall have the authority from
time to time to vary the terms of the standard form of Option Agreement
described in this Section 7 either in connection with the grant or amendment of
an individual Option or in connection with the authorization of a new standard
form or forms; provided, however, that the terms and conditions of any such new,
revised or amended standard form or forms of Option Agreement shall be in
accordance with the terms of the Plan.

                             Transfer of Control.
                             -------------------

          8.1  Definitions.

                    An "Ownership Change Event" shall be deemed to have occurred
if any of the following occurs with respect to the Company: (i) the direct or
indirect sale or exchange in a single or series of related transactions by the
stockholders of the Company of more than fifty percent (50%) of the voting stock
of the Company; (ii) a merger or consolidation in which the Company is a party;
(iii) the sale, exchange, or transfer of all or substantially all of the assets
of the Company; or (iv) a liquidation or dissolution of the Company.

                    A "Transfer of Control" shall mean an Ownership Change Event
or a series of related Ownership Change Events (collectively, the "Transaction")
wherein the stockholders of the Company immediately before the Transaction do
not retain immediately after the Transaction, in substantially the same
proportions as their ownership of shares of the Company's voting stock
immediately before the Transaction, direct or indirect beneficial ownership of
more than fifty percent (50%) of the total combined voting power of the
outstanding voting stock of the Company or the corporation or corporations to
which the assets of the Company were transferred (the "Transferee
Corporation(s)"), as the case may be. For purposes of the preceding sentence,
indirect beneficial ownership shall include, without limitation, an interest
resulting from ownership of the voting stock of one or more corporations which,
as a result of the Transaction, own the Company or the Transferee
Corporation(s), as the case may be, either directly or through one or more
subsidiary corporations. The Board shall have the right to determine whether
multiple sales or exchanges of the voting stock of the Company or multiple
Ownership Change Events are related, and its determination shall be final,
binding and conclusive.

          8.2  Effect of Transfer of Control on Options. In the event of a
Transfer of Control, the surviving, continuing, successor, or purchasing
corporation or parent corporation thereof, as the case may be (the "Acquiring
Corporation"), may either assume the Company's rights and obligations under
outstanding Options or substitute for outstanding Options substantially
equivalent options for the Acquiring Corporation's stock. The Board may, in its
sole discretion, provide in any Option Agreement that in the event the Acquiring
Corporation elects not to assume or substitute for outstanding Options in
connection with a Transfer of Control (or regardless of whether the Acquiring
Corporation so elects), any unexercisable or unvested portion of the outstanding
Option shall be immediately exercisable and vested in full as of the date ten
(10) days prior to the date of the Transfer of Control. The exercise or vesting
of any Option that was permissible solely by reason of this Section 8.2 and the
provisions of such Option Agreement shall be conditioned upon the consummation
of the Transfer of Control. Any Options which are neither assumed or substituted
for by the Acquiring Corporation in connection with the Transfer of Control nor
exercised as of the date of the Transfer of Control shall terminate and cease to
be outstanding effective as of the date of the Transfer of Control.
Notwithstanding the foregoing, shares acquired upon exercise of an Option prior
to the Transfer of Control and any consideration received pursuant to the
Transfer of Control with respect to such shares shall continue to be subject to
all applicable provisions of the Option Agreement evidencing such Option except
as otherwise provided in such Option Agreement. Furthermore, notwithstanding the
foregoing, if the corporation the stock of which is subject to the outstanding
Options immediately prior to an Ownership Change Event described in Section
8.1(a)(i) constituting a Transfer of Control is the surviving or continuing
corporation and immediately after such Ownership Change Event less than fifty
percent (50%) of the total combined voting power of its voting stock is held by
another corporation or by other corporations
<PAGE>

that are members of an affiliated group within the meaning of Section 1504(a) of
the Code without regard to the provisions of Section 1504(b) of the Code, the
outstanding Options shall not terminate unless the Board otherwise provides in
its sole discretion.

             Nontransferability of Options. During the lifetime of the Optionee,
an Option shall be exercisable only by the Optionee or the Optionee's guardian
 or legal representative. No Option shall be assignable or transferable by the
Optionee, except by will or by the laws of descent and distribution, except as
                       provided in an Option Agreement.

             Compliance with Securities Laws. The grant of Options and the
   issuance of shares of Stock upon exercise of Options shall be subject to
 compliance with all applicable requirements of federal, state and foreign law
 with respect to such securities. Options may not be exercised if the issuance
 of shares of Stock upon exercise would constitute a violation of any applicable
 federal, state or foreign securities laws or other law or regulations or the
 requirements of any stock exchange or market system upon which the Stock may
     then be listed. In addition, no Option may be exercised unless (a) a
 registration statement under the Securities Act shall at the time of exercise
of the Option be in effect with respect to the shares issuable upon exercise of
 the Option or (b) in the opinion of legal counsel to the Company, the shares
issuable upon exercise of the Option may be issued in accordance with the terms
of an applicable exemption from the registration requirements of the Securities
  Act. The inability of the Company to obtain from any regulatory body having
jurisdiction the authority, if any, deemed by the Company's legal counsel to be
necessary to the lawful issuance and sale of any shares hereunder shall relieve
 the Company of any liability in respect of the failure to issue or sell such
shares as to which such requisite authority shall not have been obtained. As a
 condition to the exercise of any Option, the Company may require the Optionee
to satisfy any qualifications that may be necessary or appropriate, to evidence
compliance with any applicable law or regulation and to make any representation
     or warranty with respect thereto as may be requested by the Company.

             Indemnification. In addition to such other rights of
    indemnification as they may have as members of the Board or officers or
  employees of the Participating Company Group, members of the Board and any
 officers or employees of the Participating Company Group to whom authority to
act for the Board is delegated shall be indemnified by the Company against all
   reasonable expenses, including attorneys' fees, actually and necessarily
incurred in connection with the defense of any action, suit or proceeding, or in
connection with any appeal therein, to which they or any of them may be a party
by reason of any action taken or failure to act under or in connection with the
 Plan, or any right granted hereunder, and against all amounts paid by them in
 settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
  in any such action, suit or proceeding, except in relation to matters as to
which it shall be adjudged in such action, suit or proceeding that such person
is liable for gross negligence, bad faith or intentional misconduct in duties;
 provided, however, that within sixty (60) days after the institution of such
action, suit or proceeding, such person shall offer to the Company, in writing,
       the opportunity at its own expense to handle and defend the same.

             Termination or Amendment of Plan. The Board may terminate or amend
  the Plan at any time. However, no termination or amendment of the Plan may
adversely affect any then outstanding Option or any unexercised portion thereof,
 without the consent of the Optionee, unless such termination or amendment is
       necessary to comply with any applicable law, regulation or rule.
<PAGE>

                                 PLAN HISTORY
                                 ------------

_____________, 2000    Board adopts the Plan, with an initial reserve of
2,000,000 shares.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.8
<SEQUENCE>4
<FILENAME>0004.txt
<DESCRIPTION>FORM OF LEASE AGREEMENT (LAND) JUNE 1, 2000
<TEXT>

<PAGE>

================================================================================
                                                                    EXHIBIT 10.8




                                  $31,400,000

                                LEASE AGREEMENT
                                    (Land)



                                    BETWEEN



                            BNP LEASING CORPORATION

                                   ("BNPLC")

                                      AND

                            EXTREME NETWORKS, INC.

                                  ("Extreme")




                                 June 1, 2000

                           (Santa Clara, California)




================================================================================

[Land]
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                      Page
                                                                                                                      ----
<S>                                                                                                                   <C>
1.   Term............................................................................................................    2
     (a)      Scheduled Term.........................................................................................    2
              --------------
     (b)      Election by Extreme to Terminate After Accelerating the Designated Sale Date...........................    2
              ----------------------------------------------------------------------------
     (c)      Extension of the Term..................................................................................    3
              ---------------------

2.   Use and Condition of the Property...............................................................................    3
     (a)      Use....................................................................................................    3
              ---
     (b)      Condition of the Property..............................................................................    4
              -------------------------
     (c)      Consideration for and Scope of Waiver..................................................................    4
              -------------------------------------

3.   Rent............................................................................................................    4
     (a)      Base Rent Generally....................................................................................    4
              -------------------
     (b)      Impact of Collateral Upon Formulas.....................................................................    4
              ----------------------------------
     (c)      Calculation of and Due Dates for Base Rent.............................................................    5
              ------------------------------------------
              (i)      Determination of Payment Due Dates, Generally.................................................    5
                       ---------------------------------------------
              (ii)     Special Adjustments to Base Rent Payment Dates and Periods....................................    5
                       ----------------------------------------------------------
              (iii)    Base Rent Formula for Periods During Which The Collateral Percentage is 100%..................    6
                       ----------------------------------------------------------------------------
              (iv)     Base Rent Formula for Periods During Which The Collateral Percentage is Less Than 100%........    6
                       --------------------------------------------------------------------------------------
     (d)      Additional Rent........................................................................................    7
              ---------------
     (e)      No Demand or Setoff....................................................................................    7
              -------------------
     (f)      Default Interest and Order of Application..............................................................    8
              -----------------------------------------

4.   Nature of this Agreement.........................................................................................    8
     (a)      "Net" Lease Generally..................................................................................    8
              ---------------------
     (b)      No Termination.........................................................................................    8
              --------------
     (c)      Tax Reporting..........................................................................................    9
              -------------
     (d)      Characterization of this Land Lease....................................................................    9
              -----------------------------------

5.   Payment of Executory Costs and Losses Related to the Property...................................................   10
     (a)      Impositions............................................................................................   10
              -----------
     (b)      Increased Costs; Capital Adequacy Charges..............................................................   10
              -----------------------------------------
     (c)      Extreme's Payment of Other Losses; General Indemnification.............................................   11
              ----------------------------------------------------------
     (d)      Exceptions and Qualifications to Indemnities...........................................................   13
              --------------------------------------------

6.   Environmental...................................................................................................   14
     (a)      Environmental Covenants by Extreme.....................................................................   14
              ----------------------------------
     (b)      Right of BNPLC to do Remedial Work Not Performed by Extreme............................................   14
              -----------------------------------------------------------
     (c)      Environmental Inspections and Reviews..................................................................   15
              -------------------------------------
     (d)      Communications Regarding Environmental Matters.........................................................   15
              ----------------------------------------------

7.   Insurance Required and Condemnation.............................................................................   16
</TABLE>

[Land]
<PAGE>

<TABLE>
<S>                                                                                                                     <C>
     (a)      Liability Insurance....................................................................................   16
              -------------------
     (b)      Failure to Obtain Insurance............................................................................   16
              ---------------------------
     (c)      Condemnation...........................................................................................   16
              ------------

8.   Application of Insurance and Condemnation Proceeds..............................................................   16
     (a)      Collection and Application of Insurance and Condemnation Proceeds Generally............................   17
              ---------------------------------------------------------------------------
     (b)      Advances of Escrowed Proceeds to Extreme...............................................................   17
              ----------------------------------------
     (c)      Application of Escrowed Proceeds as a Qualified Prepayment.............................................   17
              ----------------------------------------------------------
     (d)      Special Provisions Applicable After Completion by Extreme of the Initial Renovations...................   18
              ------------------------------------------------------------------------------------
     (e)      Special Provisions Applicable After an Event of Default................................................   18
              -------------------------------------------------------
     (f)      Extreme's Obligation to Restore........................................................................   18
              -------------------------------
     (g)      Takings of All or Substantially All of the Property....................................................   18
              ---------------------------------------------------

9.   Additional Representations, Warranties and Covenants of Extreme Concerning the Property.........................   18
     (a)      Compliance with Covenants and Laws.....................................................................   18
              ----------------------------------
     (b)      Operation of the Property..............................................................................   19
              -------------------------
     (c)      Debts for Construction, Maintenance, Operation or Development..........................................   20
              -------------------------------------------------------------
     (d)      Repair, Maintenance, Alterations and Additions.........................................................   20
              ----------------------------------------------
     (e)      Permitted Encumbrances and Development Documents.......................................................   20
              ------------------------------------------------
     (f)      Books and Records Concerning the Property..............................................................   21
              -----------------------------------------

10.  Financial Covenants, Reporting Covenants and Other Covenants Incorporated by Reference to Schedule 1............   21
                                                                                               ----------
11.  Assignment and Subletting by Extreme............................................................................   21
     (a)      BNPLC's Consent Required...............................................................................   21
              ------------------------
     (b)      Standard for BNPLC's Consent to Assignments and Certain Other Matters..................................   21
              ---------------------------------------------------------------------
     (c)      Consent Not a Waiver...................................................................................   21
              --------------------

12.  Assignment by BNPLC.............................................................................................   21
     (a)      Restrictions on Transfers..............................................................................   21
              -------------------------
     (b)      Effect of Permitted Transfer or other Assignment by BNPLC..............................................   22
              ---------------------------------------------------------

13.  BNPLC'S Right of Access.........................................................................................   22

14.  Events of Default...............................................................................................   23

15.  Remedies........................................................................................................   24
     (a)      Basic Remedies.........................................................................................   24
              --------------
     (b)      Notice Required So Long As the Purchase Option and Extreme's Initial Remarketing
              --------------------------------------------------------------------------------
              Rights and Obligations Continue Under the Purchase Agreement...........................................   26
              --------------------------------------------------
     (c)      Enforceability.........................................................................................   26
              --------------
     (d)      Remedies Cumulative....................................................................................   26
              -------------------

16.  Default by BNPLC................................................................................................   27

17.  Quiet Enjoyment.................................................................................................   27

18.  Surrender Upon Termination......................................................................................   27
</TABLE>

[Land]
<PAGE>

<TABLE>
<S>                                                                                                                     <C>
19.  Holding Over by Extreme.........................................................................................   28

20.  Independent Obligations Evidenced by the Other Operative Documents..............................................   28
</TABLE>

[Land]
<PAGE>

                            Exhibits and Schedules

Exhibit A......................................................Legal Description
---------

Exhibit B.................................................Insurance Requirements
---------

Exhibit C.............................................LIBOR Period Election Form
---------

Schedule 1............................Financial Covenants and Other Requirements
----------

[Land]

                                     (iv)
<PAGE>

                                LEASE AGREEMENT
                                    (LAND)


     This LEASE AGREEMENT (LAND) (this "Land Lease"), is made and dated as of
June 1, 2000 (the "Effective Date") by and between BNP LEASING CORPORATION, a
Delaware corporation ("BNPLC"), and EXTREME NETWORKS, INC., a Delaware
corporation ("Extreme").

                                   RECITALS

     Contemporaneously with the execution of this Land Lease, BNPLC and Extreme
are executing a Common Definitions and Provisions Agreement (Land) dated as of
the Effective Date (the "Common Definitions and Provisions Agreement (Land)"),
which by this reference is incorporated into and made a part of this Land Lease
for all purposes. As used in this Land Lease, capitalized terms defined in the
Common Definitions and Provisions Agreement (Land) and not otherwise defined in
this Land Lease are intended to have the respective meanings assigned to them in
the Common Definitions and Provisions Agreement (Improvements).

     Pursuant to the Acquisition Contract, which covers the Land described in
Exhibit A, BNPLC is acquiring the Land and any appurtenances thereto and all
---------
existing Improvements thereon from Seller contemporaneously with the execution
of this Land Lease.

     In anticipation of BNPLC's acquisition of the Land and the existing
Improvements thereon under the Acquisition Contract, BNPLC and Extreme have
reached agreement as to the terms and conditions upon which BNPLC is willing to
lease the Land to Extreme, and by this Land Lease BNPLC and Extreme desire to
evidence such agreement.

                               GRANTING CLAUSES

     BNPLC does hereby LEASE, DEMISE and LET unto Extreme for the term
hereinafter set forth all right, title and interest of BNPLC, now owned or
hereafter acquired, in and to:

          (1)  the Land;

          (2)  all easements and other rights appurtenant to the Land, whether
     now owned or hereafter acquired by BNPLC; and

          (3)  (A) any land lying within the right-of-way of any street, open or
     proposed, adjoining the Land, (B) any sidewalks and alleys adjacent to the
     Land and (C) any strips and gores between the Land and any abutting land
     not owned or leased by BNPLC.

BNPLC's interest in all property described in clauses (1) through (3) above are
hereinafter referred to collectively as the "Real Property". The Real Property
does not include any Improvements (now existing or those to be constructed as
provided in the Other Lease Agreement) or BNPLC's rights appurtenant to the
Improvements, it being understood that the Other Lease Agreement constitutes a
separate lease of the Improvements and the appurtenances thereto, and only the
Improvements and the appurtenances thereto, from BNPLC to Extreme.

[Land]
<PAGE>

     To the extent, but only to the extent, that assignable rights or interests
in, to or under the following have been or will be acquired by BNPLC under the
Acquisition Contract or acquired by BNPLC pursuant to Paragraph ? below, BNPLC
also hereby grants and assigns to Extreme for the term of this Land Lease the
right to use and enjoy (and, in the case of contract rights, to enforce) such
rights or interests of BNPLC:

          (a)  the benefits, if any, conferred upon the owner of the Real
     Property by the Permitted Encumbrances and Development Documents; and

          (b)  any permits, licenses, franchises, certificates, and other rights
     and privileges against third parties related to the Real Property.

Such rights and interests of BNPLC, whether now existing or hereafter arising,
are hereinafter collectively called the "Personal Property". The Real Property
and the Personal Property are hereinafter sometimes collectively called the
"Property."

     However, the leasehold estate conveyed hereby and Extreme's rights
hereunder are expressly made subject and subordinate to the terms and conditions
of this Land Lease, the Premises Leases and all other Permitted Encumbrances,
and to any other claims or encumbrances not constituting Liens Removable by
BNPLC.

                         GENERAL TERMS AND CONDITIONS

     The Property is leased by BNPLC to Extreme and is accepted and is to be
used and possessed by Extreme upon and subject to the following terms and
conditions:

     1    Term.

          (a)  Scheduled Term.  The term of this Land Lease (the "Term") shall
               --------------
commence on and include the Effective Date, and end on the first Business Day of
July, 2005, unless sooner terminated as expressly herein provided.

          (b)  Election by Extreme to Terminate After Accelerating the
               -------------------------------------------------------
Designated Sale Date.  Extreme shall be entitled to accelerate the Designated
--------------------
Sale Date (and thus accelerate the purchase of BNPLC's interest in the Property
by Extreme or by an Applicable Purchaser pursuant to the Purchase Agreement) by
sending a notice to BNPLC as provided in clause (2) of the definition of
"Designated Sale Date" in the Common Definitions and Provisions Agreement
(Land). In the event, because of Extreme's election to so accelerate the
Designated Sale Date or for any other reason, the Designated Sale Date occurs
before the end of the scheduled Term, Extreme may terminate this Land Lease on
or after the Designated Sale Date; provided, however, as a condition to any such
termination by Extreme, Extreme must have done the following prior to the
termination:

          (i)    purchased or caused an Applicable Purchaser to purchase the
     Property pursuant to the Purchase Agreement and satisfied all of Extreme's
     other obligations under the Purchase Agreement;

          (ii)   paid to BNPLC all Base Rent and all other Rent due on or before
     or accrued through the Designated Sale Date; and

          (iii)  paid any Breakage Costs caused by BNPLC's sale of the Property
     pursuant to the Purchase Agreement.

[Land]

                                      -2-
<PAGE>

          (c)  Extension of the Term.  The Term may be extended at the option of
               ---------------------
Extreme for two successive periods of five years each; provided, however, that
prior to any such extension the following conditions must have been satisfied:
(A) at least one hundred eighty days prior to the commencement of any such
extension, BNPLC and Extreme must have agreed in writing upon, and received the
consent and approval of BNPLC's Parent and all other Participants to (1) a
corresponding extension not only to the date for the expiration of the Term
specified above in this Section, but also to the date specified in clause (1) of
the definition of Designated Sale Date in the Common Definitions and Provisions
Agreement (Land), and (2) an adjustment to the Rent that Extreme will be
required to pay for the extension, it being expected that the Rent for the
extension may be different than the Rent required for the original Term, and it
being understood that the Rent for any extension must in all events be
satisfactory to both BNPLC and Extreme, each in its sole and absolute
discretion; (B) no Event of Default shall have occurred and be continuing at the
time of Extreme's exercise of its option to extend; and (C) immediately prior to
any such extension, this Land Lease must remain in effect. With respect to the
condition that BNPLC and Extreme must have agreed upon the Rent required for any
extension of the Term, neither Extreme nor BNPLC is willing to submit itself to
a risk of liability or loss of rights hereunder for being judged unreasonable.
Accordingly, both Extreme and BNPLC hereby disclaim any obligation express or
implied to be reasonable in negotiating the Rent for any such extension. Subject
to the changes to the Rent payable during any extension of the Term as provided
in this Paragraph, if Extreme exercises its option to extend the Term as
provided in this Paragraph, this Land Lease shall continue in full force and
effect, and the leasehold estate hereby granted to Extreme shall continue
without interruption and without any loss of priority over other interests in or
claims against the Property that may be created or arise after the date hereof
and before the extension.

     2    Use and Condition of the Property.

          (a)  Use.  Subject to the Permitted Encumbrances, the Development
               ---
Documents and the terms hereof, Extreme may use and occupy the Property during
the Term, but only for the following purposes and other lawful purposes
incidental thereto;

          (i)  constructing, maintaining and using Improvements on the Land for
     purposes expressly permitted by and described in Paragraph 2(a) of the
                                                      --------------
     Other Lease Agreement; and

          (ii) other lawful purposes approved in advance and in writing by
     BNPLC, which approval will not be unreasonably withheld (but Extreme
     acknowledges that BNPLC's withholding of such approval shall be reasonable
     if BNPLC determines in good faith that (1) giving the approval may
     materially increase BNPLC's risk of liability for any existing or future
     environmental problem, or (2) giving the approval is likely to
     substantially increase BNPLC's administrative burden of complying with or
     monitoring Extreme's compliance with the requirements of this Land Lease or
     other Operative Documents).

Nothing in this subparagraph will prevent a tenant under a Premises Lease,
executed prior to the Effective Date, from using the space covered thereby for
purposes expressly authorized by the terms and conditions of such Premises
Lease.

          (b)  Condition of the Property. Extreme acknowledges that it has
               -------------------------
carefully and fully inspected the Property and accepts the Property in its
present state, AS IS, and without any representation or warranty, express or
               -----
implied, as to the condition of such property or as to the use which may be made
thereof. Extreme also accepts the Property without any covenant, representation
or warranty, express or implied, by BNPLC or its Affiliates regarding the title
thereto or the rights of any parties in possession of any part thereof, except
as expressly set forth in Paragraph 17. BNPLC shall not be responsible for any
latent or other defect or change of

[Land]

                                      -3-
<PAGE>

condition in the Land or in Improvements, fixtures and personal property forming
a part of the Property or for any violations with respect thereto of Applicable
Laws. Further, BNPLC shall not be required to furnish to Extreme any facilities
or services of any kind, including water, steam, heat, gas, air conditioning,
electricity, light or power.

          (c)  Consideration for and Scope of Waiver. The provisions of
               -------------------------------------
subparagraph 2.(b) above have been negotiated by BNPLC and Extreme after due
consideration for the Rent payable hereunder and are intended to be a complete
exclusion and negation of any representations or warranties of BNPLC or its
Affiliates, express or implied, with respect to the Property that may arise
pursuant to any law now or hereafter in effect or otherwise, except as expressly
set forth herein.

     However, such exclusion of representations and warranties by BNPLC is not
intended to impair any representations or warranties made by other parties, the
benefit of which may pass to Extreme during the Term because of the definition
of Personal Property and Property above.

     3    Rent.

          (a)  Base Rent Generally. On each Base Rent Date through the end of
               -------------------
the Term, Extreme shall pay BNPLC rent ("Base Rent"), calculated as provided
below. Each payment of Base Rent must be received by BNPLC no later than 10:00
a.m. (Pacific time) on the date it becomes due; if received after 10:00 a.m.
(Pacific time) it will be considered for purposes of this Land Lease as received
on the next following Business Day. At least five days prior to each Base Rent
Date, BNPLC shall notify Extreme in writing of the amount of each installment,
calculated as provided below. Any failure by BNPLC to so notify Extreme,
however, shall not constitute a waiver of BNPLC's right to payment, but absent
such notice Extreme shall not be in default hereunder for any underpayment
resulting therefrom if Extreme, in good faith, reasonably estimates the payment
required, makes a timely payment of the amount so estimated and corrects any
underpayment within three Business Days after being notified by BNPLC of the
underpayment.

          (b)  Impact of Collateral Upon Formulas. To ease the administrative
               ----------------------------------
burden of this Land Lease and the Pledge Agreement, the formulas for calculating
Base Rent set out below in subparagraph 3.(c) reflect a reduction in the Base
Rent equal to the interest that would accrue on any Collateral provided in
accordance with the requirements of the Pledge Agreement from time to time if
the Accounts (as defined in the Pledge Agreement) bore interest at the Deposit
Rate. BNPLC has agreed to such reduction to provide Extreme with the economic
equivalent of interest on such Collateral, and in return Extreme has agreed to
the provisions of the Pledge Agreement that excuse the actual payment of
interest on the Accounts. By incorporating such reduction of Base Rent into the
formulas below, and by providing for noninterest bearing Accounts in the Pledge
Agreement, an unnecessary and cumbersome periodic exchange of equal payments
will be avoided. It is not, however, the intent of BNPLC or Extreme to
understate Base Rent or interest for financial reporting purposes. Accordingly,
for purposes of any financial reports that this Land Lease requires of Extreme
from time to time, Extreme may report Base Rent as if there had been no such
reduction and as if the Collateral from time to time provided in accordance with
the requirements of the Pledge Agreement had been maintained in Accounts bearing
interest at the Deposit Rate.

          (c)  Calculation of and Due Dates for Base Rent.  Payments of Base
               ------------------------------------------
Rent shall be calculated and become due as follows:

          (i)  Determination of Payment Due Dates, Generally.
               ---------------------------------------------

[Land]

                                      -4-
<PAGE>

               a0 For all Base Rent Periods subject to a LIBOR Period Election
          of one month or three months, Base Rent shall be due in one
          installment on the Base Rent Date upon which the Base Rent Period
          ends.

               b0 For Base Rent Periods subject to a LIBOR Period Election of
          six months, Base Rent shall be payable in two installments, with the
          first installment becoming due on the Base Rent Date that occurs on
          the first Business Day of the third calendar month following the
          commencement of such Base Rent Period, and with the second installment
          becoming due on the Base Rent Date upon which the Base Rent Period
          ends.

               c0 For Base Rent Periods subject to a LIBOR Period Election of
          nine months, Base Rent shall be payable in three installments, with
          the first installment becoming due on the Base Rent Date that occurs
          on the first Business Day of the third calendar month following the
          commencement of such Base Rent Period, with the second installment
          becoming due on the first Business Day of the sixth calendar month
          following the commencement of such Base Rent Period, and with the
          third installment becoming due on the Base Rent Date upon which the
          Base Rent Period ends.

               d0 For Base Rent Periods subject to a LIBOR Period Election of
          twelve months, Base Rent shall be payable in four installments, with
          the first installment becoming due on the Base Rent Date that occurs
          on the first Business Day of the third calendar month following the
          commencement of such Base Rent Period, with the second installment
          becoming due on the first Business Day of the sixth calendar month
          following the commencement of such Base Rent Period, with the third
          installment becoming due on the first Business Day of the ninth
          calendar month following the commencement of such Base Rent Period,
          and with the fourth installment becoming due on the Base Rent Date
          upon which the Base Rent Period ends.

          (ii) Special Adjustments to Base Rent Payment Dates and Periods.
               ----------------------------------------------------------
Notwithstanding the foregoing:

               a0 Any Base Rent Period that begins before, and does not
          otherwise end before, the first Business Day of the first calendar
          month following a Failed Collateral Test Date shall end upon but not
          include such first Business Day, and such first Business Day shall
          constitute a Base Rent Date, upon which Extreme must pay all accrued,
          unpaid Base Rent for the Base Rent Period just ended.

               b0 In addition to Base Rent due on a the first Business Day of
          the first calendar month following a Failed Collateral Test Date,
          Extreme must pay the Breakage Costs, if any, resulting from any early
          ending of a Base Rent Period pursuant to the preceding clause
          3.(c)(ii)a).

               c0 If Extreme or any Applicable Purchaser purchases BNPLC's
          interest in the Property pursuant to the Purchase Agreement, any
          accrued unpaid Base Rent and all outstanding Additional Rent shall be
          due on the date of purchase in addition to the purchase price and
          other sums due BNPLC under the Purchase Agreement.

[Land]

                                      -5-
<PAGE>

          (iii) Base Rent Formula for Periods During Which The Collateral
                ---------------------------------------------------------
     Percentage is 100%. Each installment of Base Rent payable for any Base Rent
     ------------------
     Period during which the Collateral Percentage is one hundred percent (100%)
     shall equal:

          .     Stipulated Loss Value on the first day of such Base Rent Period,
                times

          .     the sum of (a) the Secured Spread and (b) the Effective
                Rate/Deposit Rate Difference for the period from and including
                the preceding Base Rent Date to but not including the Base Rent
                Date upon which the installment is due, times

          .     the number of days in the period from and including the
                preceding Base Rent Date to but not including the Base Rent Date
                upon which the installment is due, divided by

          .     three hundred sixty.

          Assume, only for the purpose of illustration: that the Collateral
     Percentage for a hypothetical Base Rent Period is one hundred percent
     (100%); that prior to the first day of such Base Rent Period Qualified
     Prepayments have been received by BNPLC, leaving a Stipulated Loss Value of
     $5,000,000; that the sum of the Secured Spread and the Effective
     Rate/Deposit Rate Difference is forty-two and one-half basis points
     (42.5/100 of 1%); and that such Base Rent Period contains exactly thirty
     days. Under such assumptions, the Base Rent for the hypothetical Base Rent
     Period will equal:

                    $5,000,000 x .425% x 30/360 = $1,770.83

          (iv)  Base Rent Formula for Periods During Which The Collateral
                ---------------------------------------------------------
     Percentage is Less Than 100%. Each installment of Base Rent payable for any
     ----------------------------
     Base Rent Period during which the Collateral Percentage is less than one
     hundred percent (100%) shall equal:

          .     Stipulated Loss Value on the first day of such Base Rent Period,
                times

          .     the sum of:

                         (A) the product of:

                                   (1)  the Collateral Percentage for
                                        such Base Rent Period, times

                                   (2)  the sum of (a) the Secured
                                        Spread and (b) the Effective
                                        Rate/Deposit Rate Difference
                                        for the period from and
                                        including the preceding Base
                                        Rent Date to but not including
                                        the Base Rent Date upon which
                                        the installment is due, plus

                         (B) the product of:

                                   (1)  one minus the Collateral
                                        Percentage for such Base Rent
                                        Period, times
[Land]

                                      -6-
<PAGE>

                         (2)      the sum of (a) the Effective Rate with respect
                                  to such Base Rent Period, plus (b) the
                                  Unsecured Spread for the period from and
                                  including the preceding Base Rent Date to but
                                  not including the Base Rent Date upon which
                                  the installment is due, times

          .    the number of days in the period from and including the preceding
               Base Rent Date to but not including the Base Rent Date upon which
               the installment is due, divided by

          .    three hundred sixty.

          Assume, only for the purpose of illustration: that the Collateral
     Percentage for a hypothetical Base Rent Period is fifty-five percent (55%);
     that prior to the first day of such Base Rent Period Qualified Prepayments
     have been received by BNPLC, leaving a Stipulated Loss Value of $5,000,000;
     that the Effective Rate for the Base Rent Period is 6%; that the sum of the
     Secured Spread and the Effective Rate/Deposit Rate Difference is forty-two
     and one-half basis points (42.5/100 of 1%); that upon the commencement of
     such Base Rent Period the Unsecured Spread is two hundred twenty-five basis
     points (225/100 of 1%); and that such Base Rent Period contains exactly
     thirty days. Under such assumptions, the Base Rent for the hypothetical
     Base Rent Period will equal:

$5,000,000 x {(55% x .425%) + ([1 - 55%] x [6% + 2.25%])} x 30/360 = $16,442.41

          (d)  Additional Rent. All amounts which Extreme is required to pay to
               ---------------
or on behalf of BNPLC pursuant to this Land Lease, together with every charge,
premium, interest and cost set forth herein which may be added for nonpayment or
late payment thereof, shall constitute rent (all such amounts, other than Base
Rent, are herein called "Additional Rent", and together Base Rent and Additional
Rent are herein sometimes called "Rent").

          (e)  No Demand or Setoff. Except as expressly provided herein, Extreme
               -------------------
shall pay all Rent without notice or demand and without counterclaim, deduction,
setoff or defense.

          (f)  Default Interest and Order of Application. All Rent shall bear
               -----------------------------------------
interest, if not paid when first due, at the Default Rate in effect from time to
time from the date due until paid; provided, that nothing herein contained will
be construed as permitting the charging or collection of interest at a rate
exceeding the maximum rate permitted under Applicable Laws. BNPLC shall be
entitled to apply any amounts paid by or on behalf of Extreme against any Rent
then past due in the order the same became due or in such other order as BNPLC
may elect.

     4    Nature of this Agreement.

          (a) "Net" Lease Generally. Subject only to the exceptions listed in
               --------------------
subparagraph 5.(d) below, it is the intention of BNPLC and Extreme that Base
Rent and other payments herein specified shall be absolutely net to BNPLC and
that Extreme shall pay all costs, expenses and obligations of every kind
relating to the Property or this Land Lease which may arise or become due,
including: (i) any taxes payable by virtue of BNPLC's receipt of amounts paid to
or on behalf of BNPLC in accordance with Paragraph 5; (ii) any amount for which
BNPLC is or becomes liable with respect to the Permitted Encumbrances or the
Development Documents; and (iii) any costs

[Land]

                                      -7-
<PAGE>

incurred by BNPLC (including Attorneys' Fees) because of BNPLC's acquisition or
ownership of any interest in the Property or because of this Land Lease or the
transactions contemplated herein.

          (b)  No Termination. Except as expressly provided in this Land Lease
               --------------
itself, this Land Lease shall not terminate, nor shall Extreme have any right to
terminate this Land Lease, nor shall Extreme be entitled to any abatement of the
Rent, nor shall the obligations of Extreme under this Land Lease be excused, for
any reason whatsoever, including any of the following: (i) any damage to or the
destruction of all or any part of the Property from whatever cause, (ii) the
taking of the Property or any portion thereof by eminent domain or otherwise for
any reason, (iii) the prohibition, limitation or restriction of Extreme's use or
development of all or any portion of the Property or any interference with such
use by governmental action or otherwise, (iv) any eviction of Extreme or of
anyone claiming through or under Extreme, (v) any default on the part of BNPLC
under this Land Lease or under any other agreement to which BNPLC and Extreme
are parties, (vi) the inadequacy in any way whatsoever of the Property (it being
understood that BNPLC has not made, does not make and will not make any
representation express or implied as to the adequacy thereof), (vii) any latent
or other defect in the Property or any change in the condition thereof or the
existence with respect to the Property of any violations of Applicable Laws,
(viii) any breach by Seller of the Acquisition Contract or other agreements or
promises or representations made in connection with the Acquisition Contract
(ix) any breach of a Premises Lease by any lessee thereunder, or (x) any other
cause whether similar or dissimilar to the foregoing. It is the intention of the
parties hereto that the obligations of Extreme hereunder shall be separate and
independent of the covenants and agreements of BNPLC, that Base Rent and all
other sums payable by Extreme hereunder shall continue to be payable in all
events and that the obligations of Extreme hereunder shall continue unaffected,
unless the requirement to pay or perform the same shall have been terminated or
limited pursuant to an express provision of this Land Lease. Without limiting
the foregoing, Extreme waives to the extent permitted by Applicable Laws, except
as otherwise expressly provided herein, all rights to which Extreme may now or
hereafter be entitled by law (including any such rights arising because of any
implied "warranty of suitability" or other warranty under Applicable Laws) (i)
to quit, terminate or surrender this Land Lease or the Property or any part
thereof or (ii) to any abatement, suspension, deferment or reduction of the
Rent.

     However, nothing in this subparagraph 4.(b) shall be construed as a waiver
by Extreme of any right Extreme may have at law or in equity to the following
remedies, whether because of BNPLC's failure to remove a Lien Removable by BNPLC
or because of any other default by BNPLC under this Land Lease that continues
beyond the period for cure provided in Paragraph 16: (i) the recovery of
monetary damages, (ii) injunctive relief in case of the violation, or attempted
or threatened violation, by BNPLC of any of the express covenants, agreements,
conditions or provisions of this Land Lease which are binding upon BNPLC
(including the confidentiality provisions set forth in subparagraph 13.(c)
below), or (iii) a decree compelling performance by BNPLC of any of the express
covenants, agreements, conditions or provisions of this Land Lease which are
binding upon BNPLC.

          (c)  Tax Reporting. BNPLC and Extreme shall report this Land Lease and
               -------------
the Purchase Agreement for federal income tax purposes as a conditional sale
unless prohibited from doing so by the Internal Revenue Service. If the Internal
Revenue Service shall challenge BNPLC's characterization of this Land Lease and
the Purchase Agreement as a conditional sale for federal income tax reporting
purposes, BNPLC shall notify Extreme in writing of such challenge and consider
in good faith any reasonable suggestions by Extreme about an appropriate
response. In any event, Extreme shall (subject only to the limitations set forth
in this subparagraph) indemnify and hold harmless BNPLC from and against all
liabilities, costs, additional taxes (other than Excluded Taxes) and other
expenses that may arise or become due because of such challenge or because of
any resulting recharacterization required by the Internal Revenue Service,
including any additional taxes that may become due upon any sale under the
Purchase Agreement to the extent (if any) that such additional taxes are not
offset by tax savings resulting from additional depreciation deductions or other
tax benefits to BNPLC of the recharacterization. If BNPLC receives a written
notice of any challenge by the Internal Revenue Service that BNPLC believes will
be

[Land]

                                      -8-
<PAGE>

covered by this Paragraph, then BNPLC shall promptly furnish a copy of such
notice to Extreme. The failure to so provide a copy of the notice to Extreme
shall not excuse Extreme from its obligations under this Paragraph; provided,
that if none of the officers of Extreme and none of the employees of Extreme
responsible for tax matters are aware of the challenge described in the notice
and such failure by BNPLC renders unavailable defenses that Extreme might
otherwise assert, or precludes actions that Extreme might otherwise take, to
minimize its obligations hereunder, then Extreme shall be excused from its
obligation to indemnify BNPLC against liabilities, costs, additional taxes and
other expenses, if any, which would not have been incurred but for such failure.
For example, if BNPLC fails to provide Extreme with a copy of a notice of a
challenge by the Internal Revenue Service covered by the indemnities set out in
this Land Lease and Extreme is not otherwise already aware of such challenge,
and if as a result of such failure BNPLC becomes liable for penalties and
interest covered by the indemnities in excess of the penalties and interest that
would have accrued if Extreme had been promptly provided with a copy of the
notice, then Extreme will be excused from any obligation to BNPLC to pay the
excess.

          (d)  Characterization of this Land Lease. For purposes of determining
               -----------------------------------
the appropriate financial accounting for this Land Lease and for purposes of
determining their respective rights and remedies under state law, BNPLC and
Extreme believe and intend that (i) this Land Lease constitutes a true lease,
not a mere financing arrangement, enforceable in accordance with its express
terms, and the preceding subparagraph is not intended to affect the enforcement
of any other provisions of this Land Lease or the Purchase Agreement, and (ii)
the Purchase Agreement shall constitute a separate and independent contract,
enforceable in accordance with the express terms and conditions set forth
therein. In this regard, Extreme acknowledges that Extreme asked BNPLC to
participate in the transactions evidenced by this Land Lease and the Purchase
Agreement as a landlord and owner of the Property, not as a lender. Although
other transactions might have been used to accomplish similar results, Extreme
expects to receive certain material accounting and other advantages through the
use of a lease transaction. Accordingly, and notwithstanding the reporting for
income tax purposes described in the preceding subparagraph, Extreme cannot
equitably deny that this Land Lease and the Purchase Agreement should be
construed and enforced in accordance with their respective terms, rather than as
a mortgage or other security device, in any action brought by BNPLC to enforce
this Land Lease or the Purchase Agreement.

     5    Payment of Executory Costs and Losses Related to the Property.

          (a)  Impositions.  Subject only to the exceptions listed in
               -----------
subparagraph 5.(d) below, Extreme shall pay or cause to be paid prior to
delinquency all ad valorem taxes assessed against the Property and other
Impositions. If requested by BNPLC from time to time, Extreme shall furnish
BNPLC with receipts showing payment of all Impositions prior to the applicable
delinquency date therefor.

     Notwithstanding the foregoing, Extreme may in good faith, by appropriate
proceedings, contest the validity, applicability or amount of any asserted
Imposition, and pending such contest Extreme shall not be deemed in default
under any of the provisions of this Land Lease because of the Imposition if (1)
Extreme diligently prosecutes such contest to completion in a manner reasonably
satisfactory to BNPLC, and (2) Extreme promptly causes to be paid any amount
adjudged by a court of competent jurisdiction to be due, with all costs,
penalties and interest thereon, promptly after such judgment becomes final;
provided, however, in any event each such contest shall be concluded and the
contested Impositions must be paid by Extreme prior to the earlier of (i) the
date that any criminal prosecution is instituted or overtly threatened against
BNPLC or its directors, officers or employees because of the nonpayment thereof
or (ii) the date any writ or order is issued under which any property owned or
leased by BNPLC (including the Property) may be seized or sold or any other
action is taken against BNPLC or against any property owned or leased by BNPLC
because of the nonpayment thereof, or (iii) any Designated Sale Date upon which,
for any reason, Extreme or an Affiliate of Extreme or any Applicable Purchaser
shall not purchase BNPLC's interest in the Property pursuant to the Purchase
Agreement for a price to BNPLC (when taken

[Land]

                                      -9-
<PAGE>

together with any additional payments made by Extreme pursuant to Paragraph
                                                                  ---------
1(A)(2) of the Purchase Agreement, in the case of a purchase by an Applicable
-------
Purchaser) equal to the Break Even Price.

          (b)   Increased Costs; Capital Adequacy Charges.  Subject only to the
                -----------------------------------------
exceptions listed in subparagraph 5.(d) below:

          (i)   If after the Effective Date there shall be any increase in the
     cost to BNPLC's Parent or any other Participant agreeing to make or making,
     funding or maintaining advances to BNPLC in connection with the Property
     because of any Banking Rules Change, then Extreme shall from time to time,
     pay to BNPLC for the account of BNPLC's Parent or such other Participant,
     as the case may be, additional amounts sufficient to compensate BNPLC's
     Parent or the Participant for such increased cost. An increase in costs
     resulting from any imposition or increase of reserve requirements
     applicable to Collateral held from time to time by BNPLC's Parent or other
     Participants pursuant to the Pledge Agreement would be an increase covered
     by the preceding sentence. A certificate as to the amount of such increased
     cost, submitted to BNPLC and Extreme by BNPLC's Parent or the other
     Participant, shall be conclusive and binding upon Extreme, absent clear and
     demonstrable error.

          (ii)  BNPLC's Parent or any other Participant may demand additional
     payments ("Capital Adequacy Charges") if BNPLC's Parent or the other
     Participant determines that any Banking Rules Change affects the amount of
     capital to be maintained by it and that the amount of such capital is
     increased by or based upon the existence of advances made or to be made to
     BNPLC to permit BNPLC to maintain BNPLC's investment in the Property. To
     the extent that BNPLC's Parent or another Participant demands Capital
     Adequacy Charges as compensation for the additional capital requirements
     reasonably allocable to such investment or advances, Extreme shall pay to
     BNPLC for the account of BNPLC's Parent or the other Participant, as the
     case may be, the amount so demanded. Without limiting the foregoing, BNPLC
     and Extreme hereby acknowledge and agree that the provisions for
     calculating Base Rent set forth herein reflect the assumption that the
     Pledge Agreement will cause a zero percent (0%) risk weight to be assigned
     to a percentage (equal to the Collateral Percentage) of the collective
     investment of BNPLC and the Participants in the Property pursuant to 12
     Code of Federal Regulations, part 225, as from time to time supplemented or
     amended, or pursuant to any other similar or successor statute or
     regulation applicable to BNPLC and the Participants. If and so long as such
     risk weight is increased the assumed amount of zero percent (0%) because of
     a Banking Rules Change, Capital Adequacy Charges may be collected to yield
     the same rate of return to BNPLC, BNPLC's Parent and any other Participants
     (net of their costs of maintaining required capital) that they would have
     enjoyed from this Land Lease absent such increase.

          (iii) Notwithstanding the foregoing provisions of this subparagraph
     5.(b), Extreme shall not be obligated to pay any claim for compensation
     pursuant to this subparagraph 5.(b) arising or accruing more than six
     months prior to the date Extreme is notified that BNPLC or a Participant
     intends to make the claim; provided, however, that Extreme shall not be
     excused by this subparagraph from providing such compensation for any
     period during which notice on behalf of BNPLC or the Participant, as the
     case may be, could not be provided because of the retroactive application
     of the statute, regulation or other basis for the claim.

          (iv)  Any amount required to be paid by Extreme under this
     subparagraph 5.(b) shall be due fifteen days after a notice requesting such
     payment is received by Extreme.

          (c)   Extreme's Payment of Other Losses; General Indemnification.
                ----------------------------------------------------------
Subject only to the exceptions listed in subparagraph 5.(d) below:

[Land]

                                     -10-
<PAGE>

          (i)   All Losses (including Environmental Losses) asserted against or
     incurred or suffered by BNPLC or other Interested Parties at any time and
     from time to time by reason of, in connection with or arising out of (A)
     their ownership or alleged ownership of any interest in the Property or the
     Rents, (B) the use and operation of the Property, (C) the negotiation,
     administration or enforcement of the Operative Documents, (D) the making of
     the Funding Advances, (E) the breach by Extreme of this Land Lease or any
     other document executed by Extreme in connection herewith, (F) any failure
     of the Property or Extreme itself to comply with Applicable Laws, (G)
     Permitted Encumbrances, (H) Hazardous Substance Activities, including those
     occurring prior to Effective Date, (I) any obligations under the
     Acquisition Contract that survive the closing under the Acquisition
     Contract, or (K) any bodily or personal injury or death or property damage
     occurring in or upon or in the vicinity of the Property through any cause
     whatsoever, shall be paid by Extreme, and Extreme shall indemnify and
     defend BNPLC and other Interested Parties from and against all such Losses.

          (ii)  THE INDEMNITIES AND RELEASES PROVIDED HEREIN FOR THE BENEFIT OF
     BNPLC AND OTHER INTERESTED PARTIES, INCLUDING THE INDEMNITY SET FORTH IN
     -----           -          -
     THE PRECEDING SUBPARAGRAPH 5.(c)(i), SHALL APPLY EVEN IF AND WHEN THE
     SUBJECT MATTERS OF THE INDEMNITIES AND RELEASES ARE CAUSED BY OR ARISE OUT
     OF THE NEGLIGENCE OR STRICT LIABILITY OF BNPLC OR ANOTHER INTERESTED PARTY.
                                              -----            -          -
     FURTHER, SUCH INDEMNITIES AND RELEASES WILL APPLY EVEN IF INSURANCE
     OBTAINED BY EXTREME OR REQUIRED OF EXTREME BY THIS LAND LEASE OR OTHER
                                                        -    -
     OPERATIVE DOCUMENTS IS NOT ADEQUATE TO COVER LOSSES AGAINST OR FOR WHICH
     -         -                                  -
     THE INDEMNITIES AND RELEASES ARE PROVIDED. EXTREME'S LIABILITY, HOWEVER,
     FOR ANY FAILURE TO OBTAIN INSURANCE REQUIRED BY THIS LAND LEASE OR OTHER
                                                          -    -
     OPERATIVE DOCUMENTS WILL NOT BE LIMITED TO LOSSES AGAINST WHICH INDEMNITIES
     -         -                                -
     ARE PROVIDED HEREIN, IT BEING UNDERSTOOD THAT SUCH INSURANCE IS INTENDED TO
     DO MORE THAN PROVIDE A SOURCE OF PAYMENT FOR LOSSES AGAINST WHICH BNPLC AND
                                                  -                    -----
     OTHER INTERESTED PARTIES ARE ENTITLED TO INDEMNIFICATION BY THIS LAND
           -          -                                               -
     LEASE.
     -

          (iii) Costs and expenses for which Extreme shall be responsible
     pursuant to this subparagraph 5.(c) will include appraisal fees, filing and
     recording fees, inspection fees, survey fees, taxes, brokerage fees and
     commissions, abstract fees, title policy fees, Uniform Commercial Code
     search fees, escrow fees and Attorneys' Fees incurred by BNPLC with respect
     to the Property, whether such costs and expenses are incurred at the time
     of execution of this Land Lease or at any time during the Term.

          (iv)  Extreme's obligations under this subparagraph 5.(c) shall
     survive the termination or expiration of this Land Lease. Any amount to be
     paid by Extreme under this subparagraph 5.(c) shall be due fifteen days
     after a notice requesting such payment is received by Extreme.

          (v)   If an Interested Party notifies Extreme of any claim or
     proceeding included in, or any investigation or allegation concerning,
     Losses for which Extreme is responsible pursuant to this subparagraph
     5.(c), Extreme shall assume on behalf of the Interested Party and conduct
     with due diligence and in good faith the investigation and defense thereof
     and the response thereto with counsel selected by Extreme, but reasonably
     satisfactory to the Interested Party; provided, that the Interested Party
     shall have the right to be represented by advisory counsel of its own
     selection and at its own expense; and provided further, that if any such
     claim, proceeding, investigation or allegation involves both Extreme and
     the Interested Party and the Interested Party shall have reasonably
     concluded that there are legal defenses

[Land]

                                     -11-
<PAGE>

     available to it which are inconsistent with or in addition to those
     available to Extreme, then the Interested Party shall have the right to
     select separate counsel to participate in the investigation and defense of
     and response to such claim, proceeding, investigation or allegation on its
     own behalf, and Extreme shall pay or reimburse the Interested Party for all
     Attorney's Fees incurred by the Interested Party because of the selection
     of such separate counsel. If Extreme fails to assume promptly (and in any
     event within fifteen days after being notified of the applicable claim,
     proceeding, investigation or allegation) the defense of the Interested
     Party, then the Interested Party may contest (or settle, with the prior
     consent of Extreme, which consent will not be unreasonably withheld) the
     claim, proceeding, investigation or allegation at Extreme's expense using
     counsel selected by the Interested Party. Moreover, if any such failure by
     Extreme continues for forty-five days or more after Extreme is notified of
     any such claim, proceeding, investigation or allegation, the Interested
     Party may elect not to contest or continue contesting the same and instead,
     in accordance with the written advice of counsel, settle (or pay in full)
     all claims related thereto without Extreme's consent and without releasing
     Extreme from any obligations to the Interested Party under this
     subparagraph 5.(c).

          (d)  Exceptions and Qualifications to Indemnities.
               --------------------------------------------

          (i)  BNPLC acknowledges and agrees that nothing in subparagraph 4.(a)
     or the preceding subparagraphs of this Paragraph 5 shall be construed to
     require Extreme to pay or reimburse (w) any costs or expenses incurred by
     any Interested Party (including BNPLC or any transferee of BNPLC) to
     accomplish any Permitted Transfers described in clauses (1), (2), (3), (4)
     or (6) of the definition thereof in the Common Definitions and Provisions
     Agreement (Land), (x) Excluded Taxes, (y) Losses incurred or suffered by
     any Interested Party that are proximately caused by (and attributed by any
     applicable principles of comparative fault to) the Established Misconduct
     of that Interested Party, or (z) Losses incurred or suffered in connection
     with the execution of the Participation Agreement or Pledge Agreement by
     Participants (or supplements making them parties thereto) or in connection
     with any negotiation or due diligence Participants may undertake before
     entering into the Participation Agreement or Pledge Agreement. Further,
     without limiting BNPLC's rights (as provided in other provisions of this
     Land Lease and other Operative Documents) to include the following in the
     calculation of Stipulated Loss Value and the Break Even Price or to collect
     Base Rent, a Supplemental Payment and other amounts, the calculation of
     which depends upon Stipulated Loss Value or the Break Even Price, BNPLC
     acknowledges and agrees that nothing in subparagraph 4.(a) or the preceding
     subparagraphs of this Paragraph 5 shall be construed to require Extreme to
     pay or reimburse an Interested Party for costs paid by BNPLC with the
     proceeds of the Initial Funding Advance as part of the Transaction
     Expenses.

     Further, if an Interested Party receives a written notice of Losses that
     such Interested Party believes are covered by the indemnity in subparagraph
     5.(c)(i), then such Interested Party will be expected to promptly furnish a
     copy of such notice to Extreme. The failure to so provide a copy of the
     notice to Extreme shall not excuse Extreme from its obligations under
     subparagraph 5.(c)(i); provided, that if Extreme is unaware of the matters
     described in the notice and such failure renders unavailable defenses that
     Extreme might otherwise assert, or precludes actions that Extreme might
     otherwise take, to minimize its obligations, then Extreme shall be excused
     from its obligation to indemnify such Interested Party (and any Affiliate
     of such Interested Party) against the Losses, if any, which would not have
     been incurred or suffered but for such failure. For example, if BNPLC fails
     to provide Extreme with a copy of a notice of an obligation covered by the
     indemnity set out in subparagraph 5.(c)(i) and Extreme is not otherwise
     already aware of such obligation, and if as a result of such failure BNPLC
     becomes liable for penalties and interest covered by the indemnity in
     excess of the penalties and interest that would have accrued if Extreme had
     been promptly

[Land]

                                     -12-
<PAGE>

     provided with a copy of the notice, then Extreme will be excused from any
     obligation to BNPLC (or any Affiliate of BNPLC) to pay the excess.

     6    Environmental.

          (a)  Environmental Covenants by Extreme. Extreme covenants that:
               ----------------------------------

               (i)    Extreme shall not conduct or permit others to conduct
     Hazardous Substance Activities, except Permitted Hazardous Substance Use
     and Remedial Work.

               (ii)   Extreme shall not discharge or permit the discharge of
     anything on or from the Property that would require any permit under
     applicable Environmental Laws, other than (1) storm water runoff, (2) waste
     water discharges through a publicly owned treatment works, (3) discharges
     that are a necessary part of any Remedial Work, and (4) other similar
     discharges consistent with the definition herein of Permitted Hazardous
     Substance Use, in each case in strict compliance with Environmental Laws.

               (iii)  Following any discovery that Remedial Work is required by
     Environmental Laws or otherwise believed by BNPLC to be reasonably
     required, and to the extent not inconsistent with the other provisions of
     this Land Lease, Extreme shall promptly perform and diligently and
     continuously pursue such Remedial Work, in each case in strict compliance
     with Environmental Laws.

               (iv)   If requested by BNPLC in connection with any Remedial Work
     required by this subparagraph, Extreme shall retain independent
     environmental consultants acceptable to BNPLC to evaluate any significant
     new information generated during Extreme's implementation of the Remedial
     Work and to discuss with Extreme whether such new information indicates the
     need for any additional measures that Extreme should take to protect the
     health and safety of persons (including employees, contractors and
     subcontractors and their employees) or to protect the environment. Extreme
     shall implement any such additional measures to the extent required with
     respect to the Property by Environmental Laws or otherwise believed by
     BNPLC to be reasonably required and to the extent not inconsistent with the
     other provisions of this Land Lease.

          (b)  Right of BNPLC to do Remedial Work Not Performed by Extreme. If
               -----------------------------------------------------------
Extreme's failure to cure any breach of the covenants set forth in subparagraph
6.(a) continues beyond the Environmental Cure Period (as defined below), BNPLC
may, in addition to any other remedies available to it, conduct all or any part
of the Remedial Work. To the extent that Remedial Work is done by BNPLC pursuant
to the preceding sentence (including any removal of Hazardous Substances), the
cost thereof shall be a demand obligation owing by Extreme to BNPLC. As used in
this subparagraph, "Environmental Cure Period" means the period ending on the
earlier of: (1) one hundred eighty days after Extreme is notified of the breach
which must be cured within such period, (2) the date that any writ or order is
issued for the levy or sale of any property owned by BNPLC (including the
Property) because of such breach, (3) the date that any criminal action is
instituted or overtly threatened against BNPLC or any of its directors, officers
or employees because of such breach, or (4) any Designated Sale Date upon which,
for any reason, Extreme or an Affiliate of Extreme or any Applicable Purchaser
shall not purchase BNPLC's interest in the Property pursuant to the Purchase
Agreement for a net price to BNPLC (when taken together with any Supplemental
Payment made by Extreme pursuant to Paragraph 1(A)(2) of the Purchase Agreement,
                                    -----------------
in the case of a purchase by an Applicable Purchaser) equal to Stipulated Loss
Value.

          (c)  Environmental Inspections and Reviews. BNPLC reserves the right
               -------------------------------------
to retain environmental consultants to review any environmental report prepared
by Extreme or to conduct BNPLC's own

[Land]

                                     -13-
<PAGE>

investigation to confirm whether Extreme is complying with the requirements of
this Paragraph 6. Extreme grants to BNPLC and to BNPLC's agents, employees,
consultants and contractors the right to enter upon the Property during
reasonable hours and after reasonable notice to inspect the Property and to
perform such tests as BNPLC deems necessary or appropriate to review or
investigate Hazardous Substances in, on, under or about the Property or any
discharge or suspected discharge of Hazardous Substances into groundwater or
surface water from the Property. Extreme shall promptly reimburse BNPLC for the
fees of its environmental consultants and the costs of any such inspections and
tests; provided, however, BNPLC's right to such reimbursement shall be limited
to the following circumstances: (1) a breach of this Paragraph 6 by Extreme
shall, in fact, have occurred or an Event of Default shall have occurred and be
continuing at the time BNPLC engages the consultants or first initiates the
inspections and tests; (2) BNPLC shall have engaged the consultants or
undertaken the tests and inspections to establish the condition of the Property
just prior to any conveyance of the Property pursuant to the Option Agreement or
to the expiration of this Land Lease; (3) BNPLC shall have engaged the
consultants or undertaken the inspections and tests to satisfy any regulatory
requirements applicable to BNPLC or its Affiliates; or (4) BNPLC shall have
engaged the consultants or undertaken the tests because BNPLC was notified of a
violation of Environmental Laws concerning the Property by any governmental
authority or owner of other land in the vicinity of the Land.

          (d)  Communications Regarding Environmental Matters.
               ----------------------------------------------

               (i)    Extreme shall immediately advise BNPLC of (1) any
     discovery of any event or circumstance which would render any of the
     representations of Extreme herein or in the Closing Certificate concerning
     environmental matters materially inaccurate or misleading if made at the
     time of such discovery and assuming that Extreme was aware of all relevant
     facts, (2) any Remedial Work (or change in Remedial Work) required or
     undertaken by Extreme or its Affiliates in response to any (A) discovery of
     any Hazardous Substances on, under or about the Property other than
     Permitted Hazardous Substances or (B) any claim for damages resulting from
     Hazardous Substance Activities, (3) Extreme's discovery of any occurrence
     or condition on any real property adjoining or in the vicinity of the
     Property which could cause the Property or any part thereof to be subject
     to any ownership, occupancy, transferability or use restrictions under
     Environmental Laws, or (4) any investigation or inquiry of any failure or
     alleged failure by Extreme to comply with Environmental Laws affecting the
     Property by any governmental authority responsible for enforcing
     Environmental Laws. In such event, Extreme shall deliver to BNPLC within
     thirty days after BNPLC's request, a preliminary written environmental plan
     setting forth a general description of the action that Extreme proposes to
     take with respect thereto, if any, to bring the Property into compliance
     with Environmental Laws or to correct any breach by Extreme of this
     Paragraph 6, including any proposed Remedial Work, the estimated cost and
     time of completion, the name of the contractor and a copy of the
     construction contract, if any, and such additional data, instruments,
     documents, agreements or other materials or information as BNPLC may
     request.

               (ii)   Extreme shall provide BNPLC with copies of all material
     written communications with federal, state and local governments, or
     agencies relating to the matters listed in the preceding clause (i).
     Extreme shall also provide BNPLC with copies of any correspondence from
     third Persons which threaten litigation over any significant failure or
     alleged significant failure of Extreme to maintain or operate the Property
     in accordance with Environmental Laws.

               (iii)  Prior to Extreme's submission of a Material Environmental
     Communication to any governmental or regulatory agency or third party,
     Extreme shall, to the extent practicable, deliver to BNPLC a draft of the
     proposed submission (together with the proposed date of submission), and in
     good faith assess and consider any comments of BNPLC regarding the same.
     Promptly after BNPLC's request, Extreme shall meet with BNPLC to discuss
     the submission, shall provide any additional information

[Land]

                                     -14-
<PAGE>

     requested by BNPLC and shall provide a written explanation to BNPLC
     addressing the issues raised by comments (if any) of BNPLC regarding the
     submission, including a reasoned analysis supporting any decision by
     Extreme not to modify the submission in accordance with comments of BNPLC.

     7    Insurance Required and Condemnation.

          (a)  Liability Insurance.  Throughout the Term Extreme shall maintain
               -------------------
commercial general liability insurance against claims for bodily and personal
injury, death and property damage occurring in or upon or resulting from any
occurrence in or upon the Property under one or more insurance policies that
satisfy the requirements set forth in Exhibit B. Extreme shall deliver and
                                      ---------
maintain with BNPLC for each liability insurance policy required by this Land
Lease written confirmation of the policy and the scope of the coverage provided
thereby issued by the applicable insurer or its authorized agent, which
confirmation must also satisfy the requirements set forth in Exhibit B.
                                                             ---------

          (b   Failure to Obtain Insurance.  If Extreme fails to obtain any
               ---------------------------
insurance or to provide confirmation of any such insurance as required by this
Land Lease, BNPLC shall be entitled (but not required) to obtain the insurance
that Extreme has failed to obtain or for which Extreme has not provided the
required confirmation and, without limiting BNPLC's other remedies under the
circumstances, BNPLC may require Extreme to reimburse BNPLC for the cost of such
insurance and to pay interest thereon computed at the Default Rate from the date
such cost was paid by BNPLC until the date of reimbursement by Extreme.

          (c   Condemnation.  Immediately upon obtaining knowledge of the
               ------------
institution of any proceedings for the condemnation of the Property or any
portion thereof, or any other similar governmental or quasi-governmental
proceedings arising out of injury or damage to the Property or any portion
thereof, each party shall notify the other (provided, however, BNPLC shall have
no liability for its failure to provide such notice) of the pendency of such
proceedings. Extreme shall, at its expense, diligently prosecute any such
proceedings and shall consult with BNPLC, its attorneys and experts and
cooperate with them as requested in the carrying on or defense of any such
proceedings. All proceeds of condemnation awards or proceeds of sale in lieu of
condemnation with respect to the Property and all judgments, decrees and awards
for injury or damage to the Property shall be paid to BNPLC as Escrowed
Proceeds, and all such proceeds will be applied as provided in Paragraph 8.
BNPLC is hereby authorized, in the name of Extreme, at any time when an Event of
Default shall have occurred and be continuing, or otherwise with Extreme's prior
consent, to execute and deliver valid acquittances for, and to appeal from, any
such judgment, decree or award concerning condemnation of any of the Property.
BNPLC shall not be in any event or circumstances liable or responsible for
failure to collect, or to exercise diligence in the collection of, any such
proceeds, judgments, decrees or awards.

     8.   Application of Insurance and Condemnation Proceeds.

          (a   Collection and Application of Insurance and Condemnation Proceeds
               -----------------------------------------------------------------
Generally. This Paragraph 8 shall govern the application of proceeds received by
---------
BNPLC or Extreme during the Term from any third party (1) as compensation for
any restriction placed upon the use or development of the Property or for the
condemnation of the Property or any portion thereof, or (2) because of any
judgment, decree or award for injury or damage to the Property (e.g.,damage
resulting from a third party's release of Hazardous Materials onto the
Property); excluding, however, any funds paid to BNPLC by BNPLC's Parent, by an
Affiliate of BNPLC or by any Participant that is made to compensate BNPLC for
any Losses BNPLC may suffer or incur in connection with this Land Lease or the
Property. Except as provided in subparagraph 8.(d), Extreme will promptly pay
over to BNPLC any condemnation or other proceeds covered by this Paragraph 8
which Extreme may receive from any condemning authority or other third party.
All proceeds covered by this Paragraph 8, including those received by

[Land]

                                     -15-
<PAGE>

BNPLC from Extreme or third parties, shall be applied as follows:

               (i     First, proceeds covered by this Paragraph 8 will be used
     to reimburse BNPLC for any costs and expenses, including Attorneys' Fees,
     that BNPLC incurred to collect the proceeds.

               (ii    Second, the proceeds remaining after such reimbursement to
     BNPLC (hereinafter, the "Remaining Proceeds") will be applied, as
     hereinafter more particularly provided, either as a Qualified Prepayment or
     to reimburse Extreme or BNPLC for the actual out-of-pocket costs of
     repairing or restoring the Property. Until, however, any Remaining Proceeds
     received by BNPLC are applied by BNPLC as a Qualified Prepayment or applied
     by BNPLC to reimburse costs of repairs to or restoration of the Property
     pursuant to this Paragraph 8, BNPLC shall hold and maintain such Remaining
     Proceeds as Escrowed Proceeds in an interest bearing account, and all
     interest earned on such account shall be added to and made a part of such
     Escrowed Proceeds.

          (b   Advances of Escrowed Proceeds to Extreme. Except as otherwise
               ----------------------------------------
provided below in this Paragraph 8, BNPLC shall advance all Remaining Proceeds
held by it as Escrowed Proceeds to reimburse Extreme for the actual out-of-
pocket cost to Extreme of repairing or restoring the Property in accordance with
the requirements of this Land Lease and the other Operative Documents as the
applicable repair or restoration progresses and upon compliance by Extreme with
such terms, conditions and requirements as may be reasonably imposed by BNPLC.
In no event, however, shall BNPLC be required to pay Escrowed Proceeds to
Extreme in excess of the actual out-of-pocket cost to Extreme of the applicable
repair or restoration, as evidenced by invoices or other documentation
satisfactory to BNPLC, it being understood that BNPLC may retain and apply any
such excess as a Qualified Prepayment.

          (c   Application of Escrowed Proceeds as a Qualified Prepayment.
               ----------------------------------------------------------
Provided no Event of Default shall have occurred and be continuing, BNPLC shall
apply any Remaining Proceeds paid to it (or other amounts available for
application as a Qualified Prepayment) as a Qualified Prepayment on any date
that BNPLC is directed to do so by a notice from Extreme; however, if such a
notice from Extreme specifies an effective date for a Qualified Prepayment that
is less than five Business Days after BNPLC's actual receipt of the notice,
BNPLC may postpone the date of the Qualified Prepayment to any date not later
than five Business Days after BNPLC's receipt of the notice. In any event,
except when BNPLC is required by the preceding sentence to apply Remaining
Proceeds or other amounts as a Qualified Prepayment on the last day of a Base
Rent Period, BNPLC may deduct Breakage Costs incurred in connection with any
Qualified Prepayment from the Remaining Proceeds or other amounts available for
application as the Qualified Prepayment, and Extreme will reimburse BNPLC upon
request for any such Breakage Costs that BNPLC incurs but does not deduct.

          (d   Special Provisions Applicable After Completion by Extreme of the
               ----------------------------------------------------------------
Initial Renovations. If, after Extreme has completed any Initial Renovations
-------------------
which Extreme elects to undertake as provided in the Other Lease, any taking by
condemnation of any portion of the Property or any diminution, destruction,
demolition or damage to any portion of the Property shall (in the good faith
judgment of BNPLC) reduce the then current "AS IS" market value by less than
$500,000 and (in the good faith estimation of BNPLC) be unlikely to result in
Remaining Proceeds of more than $500,000, and if no Event of Default shall have
occurred and be continuing, then BNPLC will, upon Extreme's request, instruct
the condemning authority or insurer, as applicable, to pay the Remaining
Proceeds resulting therefrom directly to Extreme. Extreme shall apply any such
Remaining Proceeds to the repair or restoration of the Property to a safe and
secure condition and to a value of no less than the value before taking or
casualty.

          (e   Special Provisions Applicable After an Event of Default.
               -------------------------------------------------------
Notwithstanding the foregoing,

[Land]

                                      -16
<PAGE>

when any Event of Default shall have occurred and be continuing, BNPLC shall be
entitled to receive and collect all condemnation or other proceeds governed by
this Paragraph 8 and to apply all Remaining Proceeds, when and to the extent
deemed appropriate by BNPLC in its sole discretion, either (A) to the
reimbursement of Extreme or BNPLC for the out-of-pocket cost of repairing or
restoring the Property, or (B) as Qualified Prepayments.

          (f   Extreme's Obligation to Restore. Regardless of the adequacy of
               -------------------------------
any Remaining Proceeds available to Extreme hereunder, and notwithstanding other
provisions of this Land Lease to the contrary, if the Property is damaged or
less than all or substantially all of the Property is taken by condemnation,
Extreme must:

          (i   increase the value of the Property or the remainder thereof by
     restoring the same (in a manner consistent with the requirements and
     limitations imposed by this Land Lease and the other Operative Documents or
     otherwise acceptable to BNPLC), or decrease Stipulated Loss Value by
     tendering a payment to BNPLC for application as a Qualified Prepayment, as
     necessary to cause the then current AS IS market value of the Property to
     be not less than Stipulated Loss Value; and

          (ii  restore the Property or the remainder thereof to a reasonably
     safe and sightly condition.

          (g   Takings of All or Substantially All of the Property. In the event
               ---------------------------------------------------
of any taking of all or substantially all of the Property, BNPLC shall be
entitled to apply all Remaining Proceeds as a Qualified Prepayment. In addition,
if Stipulated Loss Value immediately prior to any such taking exceeds the sum of
the Remaining Proceeds resulting from such a condemnation, then BNPLC shall be
entitled to recover the excess from Extreme upon demand as an additional
Qualified Prepayment, whereupon this Land Lease shall terminate. Any taking of
so much of the Real Property as, in BNPLC's reasonable good faith judgment,
makes it impracticable to restore or improve the remainder thereof as required
by part (ii) of the preceding subparagraph shall be considered a taking of
substantially all the Property for purposes of this Paragraph 8.

     9.   Additional Representations, Warranties and Covenants of Extreme
Concerning the Property.  Extreme represents, warrants and covenants as follows:

          (a   Compliance with Covenants and Laws. The use of the Property
               ----------------------------------
permitted by this Land Lease complies, or will comply after Extreme obtains
available permits as the tenant under this Land Lease, in all material respects
with all Applicable Laws. Extreme has obtained or will promptly obtain all
utility, building, health and operating permits as may be required by any
governmental authority or municipality having jurisdiction over the Property for
any construction upon or use of the Property permitted by this Land Lease.

          (b   Operation of the Property. During the Term, Extreme shall operate
               -------------------------
the Property in a good and workmanlike manner and substantially in compliance
with all Applicable Laws and will pay or cause to be paid all fees or charges of
any kind in connection therewith. (If Extreme does not promptly correct any
failure of the Property to comply with Applicable Laws that is the subject of a
written notice given to Extreme or BNPLC by any governmental authority, then for
purposes of the preceding sentence, Extreme shall be considered not to have
maintained the Property "substantially in accordance with Applicable Laws"
whether or not the noncompliance would be substantial in the absence of the
notice.) During the Term, Extreme shall not use or occupy, or allow the use or
occupancy of, the Property in any manner which violates any Applicable Law or
which constitutes a public or private nuisance or which makes void, voidable or
cancelable any insurance then in force with respect thereto. During the Term, to
the extent that any of the following would, individually or in the aggregate,
materially and adversely affect the value of the Property or the use of the
Property for purposes permitted by this Lease, Extreme shall not, without
BNPLC's prior consent: (i) initiate or permit any zoning reclassification of the
Property; (ii) seek any variance under existing zoning ordinances applicable to
the Property; (iii) use or permit the use of the Property

[Land]

                                     -17-
<PAGE>

in a manner that would result in such use becoming a nonconforming use under
applicable zoning ordinances or similar laws, rules or regulations; (iv) execute
or file any subdivision plat affecting the Property; or (v) consent to the
annexation of the Property to any municipality. If during the Term (A) a change
in the zoning or other Applicable Laws affecting the permitted use or
development of the Property shall occur that (in BNPLC's good faith judgment)
reduces the value of the Property, or (B) conditions or circumstances on or
about the Property are discovered (such as the presence of an endangered
species) which substantially impede development and thereby (in BNPLC's good
faith judgment) reduce the value of the Property, then Extreme shall upon demand
pay BNPLC an amount equal to such reduction (as determined by BNPLC in good
faith) for application as a Qualified Prepayment. Extreme shall not permit any
drilling or exploration for, or extraction, removal or production of, minerals
from the surface or subsurface of the Property, and Extreme shall not do
anything that could reasonably be expected to significantly reduce the market
value of the Property. If Extreme receives a notice or claim from any federal,
state or other governmental authority that the Property is not in compliance
with any Applicable Law, or that any action may be taken against BNPLC because
the Property does not comply with any Applicable Law, Extreme shall promptly
furnish a copy of such notice or claim to BNPLC.

     Notwithstanding the foregoing, Extreme may in good faith, by appropriate
proceedings, contest the validity and applicability of any Applicable Law with
respect to the Property, and pending such contest Extreme shall not be deemed in
default hereunder because of the violation of such Applicable Law, if Extreme
diligently prosecutes such contest to completion in a manner reasonably
satisfactory to BNPLC, and if Extreme promptly causes the Property to comply
with any such Applicable Law upon a final determination by a court of competent
jurisdiction that the same is valid and applicable to the Property; provided,
however, in any event such contest shall be concluded and the violation of such
Applicable Law must be corrected by Extreme and any claims asserted against
BNPLC or the Property because of such violation must be paid by Extreme, all
prior to the earlier of (i) the date that any criminal prosecution is instituted
or overtly threatened against BNPLC or any of its directors, officers or
employees because of such violation, (ii) the date that any action is taken by
any governmental authority against BNPLC or any property owned by BNPLC
(including the Property) because of such violation, or (iii) a Designated Sale
Date upon which, for any reason, Extreme or an Affiliate of Extreme or any
Applicable Purchaser shall not purchase BNPLC's interest in the Property
pursuant to the Purchase Agreement for a price to BNPLC (when taken together
with any additional payments made by Extreme pursuant to Paragraph 1(A)(2) of
                                                         -----------------
the Purchase Agreement, in the case of a purchase by an Applicable Purchaser)
equal to the Break Even Price.

          (c   Debts for Construction, Maintenance, Operation or Development.
               -------------------------------------------------------------
Extreme shall cause all debts and liabilities incurred in the construction,
maintenance, operation or development of the Property, including all debts and
liabilities for labor, material and equipment and all debts and charges for
utilities servicing the Property, to be promptly paid; provided, that nothing in
this subparagraph will be construed to require Extreme to remove Liens Removable
by BNPLC.

     Notwithstanding the foregoing, Extreme may in good faith, by appropriate
proceedings, contest the validity, applicability or amount of any asserted
mechanic's or materialmen's lien and pending such contest Extreme shall not be
deemed in default under this subparagraph because of the contested lien if (1)
within sixty days after being asked to do so by BNPLC, Extreme bonds over to
BNPLC's reasonable satisfaction all such contested liens against the Property
alleged to secure an amount in excess of $500,000 (individually or in the
aggregate), (2) Extreme diligently prosecutes such contest to completion in a
manner reasonably satisfactory to BNPLC, and (3) Extreme promptly causes to be
paid any amount adjudged by a court of competent jurisdiction to be due, with
all costs and interest thereon, promptly after such judgment becomes final;
provided, however, that in any event each such contest shall be concluded and
the lien, interest and costs must be paid by Extreme prior to the earlier of (i)
the date that any criminal prosecution is instituted or overtly threatened
against BNPLC or its directors, officers or employees because of the nonpayment
thereof, (ii) the date that any writ or order is issued under which the

[Land]

                                     -18-
<PAGE>

Property or any other property in which BNPLC has an interest may be seized or
sold or any other action is taken against BNPLC or any property in which BNPLC
has an interest because of the nonpayment thereof, or (iii) a Designated Sale
Date upon which, for any reason, Extreme or an Affiliate of Extreme or any
Applicable Purchaser shall not purchase BNPLC's interest in the Property
pursuant to the Purchase Agreement for a price to BNPLC (when taken together
with any additional payments made by Extreme pursuant to Paragraph 1(A)(2) of
                                                         -----------------
the Purchase Agreement, in the case of a purchase by an Applicable Purchaser)
equal to the Break Even Price.

          (d   Repair, Maintenance, Alterations and Additions. Extreme shall
               ----------------------------------------------
keep the Property in good order, operating condition and appearance and shall
cause all necessary repairs, renewals and replacements to be promptly made.
Extreme will not allow any of the Property to be materially misused, abused or
wasted.

          (e   Permitted Encumbrances and Development Documents. Extreme shall
               ------------------------------------------------
during the Term comply with and will cause to be performed all of the covenants,
agreements and obligations imposed upon the owner of any interest in the
Property by the Permitted Encumbrances (including the Premises Leases) or the
Development Documents. Without limiting the foregoing, Extreme shall cause all
amounts to be paid when due, the payment of which is secured by any Lien against
the Property created by the Permitted Encumbrances. Without the prior consent of
BNPLC, Extreme shall not enter into, initiate, approve or consent to any
modification of any Permitted Encumbrance or Development Document that would
create or expand or purport to create or expand obligations or restrictions
which would encumber BNPLC's interest in the Property. (Whether BNPLC must give
any such consent requested by Extreme during the Term of this Land Lease shall
be governed by subparagraph 3(A) of the Closing Certificate and Agreement.)
               -----------------

          (f   Books and Records Concerning the Property. Extreme shall keep
               -----------------------------------------
books and records that are accurate and complete in all material respects for
the Property and, subject to Paragraph 13.(c), will permit all such books and
records to be inspected and copied by BNPLC. This subparagraph shall not be
construed as requiring Extreme to regularly maintain separate books and records
relating exclusively to the Property; provided, however, that upon request,
Extreme shall construct or abstract from its regularly maintained books and
records information required by this subparagraph relating to the Property.

     10.  Financial Covenants, Reporting Covenants and Other Covenants
Incorporated by Reference to Schedule 1. Throughout the Term of this Land
                             ----------
Lease, Extreme shall comply with the requirements of Schedule 1 attached hereto.
                                                     ----------
     11.  Assignment and Subletting by Extreme.

          (a   BNPLC's Consent Required. Without the prior consent of BNPLC,
               ------------------------
Extreme shall not assign, transfer, mortgage, pledge or hypothecate this Land
Lease or any interest of Extreme hereunder and shall not sublet all or any part
of the Property, by operation of law or otherwise; provided, that this provision
shall not be construed to prohibit any sublease of space within Improvements
expressly permitted by the Other lease Agreement.

          (b   Standard for BNPLC's Consent to Assignments and Certain Other
               -------------------------------------------------------------
Matters. Consents and approvals of BNPLC which are required by this Paragraph 11
-------
will not be unreasonably withheld or delayed, but Extreme acknowledges that
BNPLC's withholding of such consent or approval shall be reasonable if BNPLC
determines in good faith that (1) giving the approval may materially increase
BNPLC's risk of liability for any existing or future environmental problem, or
(2) giving the approval is likely to increase BNPLC's administrative burden of
complying with or monitoring Extreme's compliance with the requirements of this
Land Lease.

[Land]

                                     -19-
<PAGE>

          (c   Consent Not a Waiver. No consent by BNPLC to a sale, assignment,
               --------------------
transfer, mortgage, pledge or hypothecation of this Land Lease or Extreme's
interest hereunder, and no assignment or subletting of the Property or any part
thereof in accordance with this Land Lease or otherwise with BNPLC's consent,
shall release Extreme from liability hereunder; and any such consent shall apply
only to the specific transaction thereby authorized and shall not relieve
Extreme from any requirement of obtaining the prior consent of BNPLC to any
further sale, assignment, transfer, mortgage, pledge or hypothecation of this
Land Lease or any interest of Extreme hereunder.

     12.  Assignment by BNPLC.

          (a   Restrictions on Transfers. Except by a Permitted Transfer, BNPLC
               -------------------------
shall not assign, transfer, mortgage, pledge, encumber or hypothecate this Land
Lease or the other Operative Documents or any interest of BNPLC in and to the
Property during the Term without the prior consent of Extreme, which consent
Extreme may withhold in its sole discretion. Further, notwithstanding anything
to the contrary herein contained, if withholding taxes are imposed on the rents
and other amounts payable to BNPLC hereunder because of BNPLC's assignment of
this Land Lease to any citizen of, or any corporation or other entity formed
under the laws of, a country other than the United States, Extreme shall not be
required to compensate BNPLC or any such assignee for the withholding tax. If,
in breach of this subparagraph, BNPLC transfers the Property or any part thereof
by a conveyance or that does not constitute a Permitted Transfer, with the
result that additional transfer taxes or other Impositions are assessed against
the Property or the owner thereof, BNPLC shall be required to pay such
additional transfer taxes or other Impositions.

          (b   Effect of Permitted Transfer or other Assignment by BNPLC. If,
               ---------------------------------------------------------
without breaching subparagraph 12.(a), BNPLC sells or otherwise transfers the
Property and assigns to the transferee all of BNPLC's rights under this Land
Lease and under the other Operative Documents, and if the transferee expressly
assumes all of BNPLC's obligations under this Land Lease and under the other
Operative Documents, then BNPLC shall thereby be released from any obligations
arising after such assumption under this Land Lease or under the other Operative
Documents, and Extreme shall look solely to each successor in interest of BNPLC
for performance of such obligations. (As used in this subparagraph, "Operative
Documents" is intended to mean not only the Operative Documents as defined in
the Common Definitions and Provisions Agreement (Land), but also the Operative
Documents as defined in the Other Common Definitions and Provisions Agreement.)

     13.  BNPLC'S Right Of Access.

          (a   During the Term, BNPLC and BNPLC's representatives may (subject
to subparagraphs 13.(c) and 13.(d)) enter the Property at any reasonable time
after five Business Days advance written notice to Extreme for the purpose of
making inspections or performing any work BNPLC is authorized to undertake by
the next subparagraph or for the purpose confirming whether Extreme has complied
with the requirements of this Land Lease or the other Operative Documents.

          (b   If Extreme fails to perform any act or to take any action
required of it by this Land Lease or the Closing Certificate, or to pay any
money which Extreme is required by this Land Lease or the Closing Certificate to
pay, and if such failure or action constitutes an Event of Default or renders
BNPLC or any director, officer, employee or Affiliate of BNPLC at risk of
criminal prosecution or renders BNPLC's interest in the Property or any part
thereof at risk of forfeiture by forced sale or otherwise, then in addition to
any other remedies specified herein or otherwise available, BNPLC may, perform
or cause to be performed such act or take such action or pay such money. Any
expenses so incurred by BNPLC, and any money so paid by BNPLC, shall be a demand
obligation owing by Extreme to BNPLC. Further, BNPLC, upon making such payment,
shall be subrogated to all

[Land]

                                     -20-
<PAGE>

of the rights of the person, corporation or body politic receiving such payment.
But nothing herein shall imply any duty upon the part of BNPLC to do any work
which under any provision of this Land Lease Extreme may be required to perform,
and the performance thereof by BNPLC shall not constitute a waiver of Extreme's
default. BNPLC may during the progress of any such work permitted by BNPLC
hereunder on or in the Property keep and store upon the Property all necessary
materials, tools, and equipment. BNPLC shall not in any event be liable for
inconvenience, annoyance, disturbance, loss of business, or other damage to
Extreme or the subtenants or invitees of Extreme by reason of making such
repairs or the performance of any such work on or in the Property, or on account
of bringing materials, supplies and equipment into or through the Property
during the course of such work (except for any liability in excess of the
liability insurance limits established in Exhibit B resulting from death or
                                          ---------
injury or damage to the property of third parties caused by the Established
Misconduct of BNPLC or its officers, employees, or agents in connection
therewith), and the obligations of Extreme under this Land Lease shall not
thereby be excused in any manner.

          (c   Extreme shall have no obligation to provide proprietary
information (as defined in the next sentence) to BNPLC, except and to the extent
that (1) BNPLC reasonably determines that BNPLC cannot accomplish the purposes
of BNPLC's inspection of the Property or exercise of other rights granted
pursuant to the various express provisions of this Land Lease and the other
Operative Documents without evaluating such information. For purposes of this
Land Lease "proprietary information" includes Extreme's intellectual property,
trade secrets and other confidential information of value to Extreme about,
among other things, Extreme's manufacturing processes, products, marketing and
corporate strategies, but in no event will "proprietary information" include any
disclosure of substances and materials (and their chemical composition) which
are or previously have been present in, on or under the Property at the time of
any inspections by BNPLC, nor will "proprietary information" include any
additional disclosures reasonably required to permit BNPLC to determine whether
the presence of such substances and materials has constituted a violation of
Environmental Laws. In addition, under no circumstances shall Extreme have any
obligation to disclose to BNPLC or any other party any proprietary information
of Extreme (including, without limitation, any pending applications for patents
or trademarks, any research and design and any trade secrets) except if and to
the limited extent reasonably necessary to comply with the express provisions of
this Land Lease or the other Operative Documents.

          (d   So long as Extreme remains in possession of the Property, BNPLC
or BNPLC's representative will, before making any inspection or performing any
work on the Property authorized by this Land Lease, if then requested to do so
by Extreme to maintain Extreme's security: (i) sign in at Extreme's security or
information desk if Extreme has such a desk on the premises, (ii) wear a
visitor's badge or other reasonable identification, (iii) permit an employee of
Extreme to observe such inspection or work, and (iv) comply with other similar
reasonable nondiscriminatory security requirements of Extreme that do not,
individually or in the aggregate, significantly interfere with inspections or
work of BNPLC authorized by this Land Lease.

     14.  Events of Default. Each of the following events shall be an "Event of
Default" by Extreme under this Land Lease:

     (a   Extreme shall fail to pay when due any installment of Rent due
hereunder and such failure shall continue for three (3) Business Days after
Extreme is notified in writing thereof.

     (b   Extreme shall fail to cause any representation or warranty of Extreme
contained herein or in the Closing Certificate that was false or misleading in
any material respect when made to be made true and not misleading (other than as
described in the other clauses of this Paragraph 14), or Extreme shall fail to
comply with any term, provision or covenant of this Land Lease or the Closing
Certificate (other than as described in the other clauses of this Paragraph 14),
and in either case shall not cure such failure prior to the earlier of (A)
thirty days

[Land]

                                     -21-
<PAGE>

after written notice thereof is sent to Extreme or (B) the date any writ or
order is issued for the levy or sale of any property owned by BNPLC (including
the Property) or any criminal prosecution is instituted or overtly threatened
against BNPLC or any of its directors, officers or employees because of such
failure; provided, however, that so long as no such writ or order is issued and
no such criminal prosecution is instituted or overtly threatened, the period
within which such failure may be cured by Extreme shall be extended for a
further period (not to exceed an additional sixty days) as shall be necessary
for the curing thereof with diligence, if (but only if) (x) such failure is
susceptible of cure but cannot with reasonable diligence be cured within such
thirty day period, (y) Extreme shall promptly have commenced to cure such
failure and shall thereafter continuously prosecute the curing thereof with
reasonable diligence and (z) the extension of the period for cure will not, in
any event, cause the period for cure to extend beyond five days prior to the
expiration of this Land Lease.

     (c   Extreme shall abandon the Property.

     (d   Extreme or any Subsidiary shall fail to make any payment or payments
of principal, premium or interest, of Debt of Extreme described in the next
sentence when due (taking into consideration the time Extreme may have to cure
such failure, if any, under the documents governing such Debt). As used in this
clause 14(a)(v), "Debt" shall include only Debt (as defined in the Common
Definitions and Provisions Agreement (Land)) of Extreme or any of its
Subsidiaries now existing or arising in the future (1) payable to any Interested
Party, or (2) payable to any other Person and with respect to which $5,000,000
or more is actually due and payable because of acceleration or otherwise.

     (e   Extreme: (a) shall generally not, or be unable to, or shall admit in
writing its inability to, pay its debts as such debts become due; or (b) shall
make an assignment for the benefit of creditors, petition or apply to any
tribunal for the appointment of a custodian, receiver or trustee for it or a
substantial part of its assets; or (c) shall file any petition or application to
commence any proceeding under any bankruptcy, reorganization, arrangement,
readjustment of debt, dissolution or liquidation law or statute of any
jurisdiction, whether now or hereafter in effect; or (d) shall have had any such
petition or application filed against it; or (e) by any act or omission shall
indicate its consent to, approval of or acquiescence in any such petition,
application or proceeding or order for relief or the appointment of a custodian,
receiver or trustee for all or any substantial part of its property; or (f)
shall suffer any such custodianship, receivership or trusteeship to continue
undischarged for a period of sixty days or more.

     (f   One or more final judgments, decrees or orders for the payment of
money in excess of $5,000,000 in the aggregate shall be rendered against Extreme
and such judgments, decrees or orders shall continue unsatisfied and in effect
for a period of thirty consecutive days without Extreme's having obtained an
agreement (or after the expiration or termination of an agreement) of the
Persons entitled to enforce such judgment, decrees or orders not to enforce the
same pending negotiations with Extreme concerning the satisfaction or other
discharge of the same. (For purposes of this provision, no judgment, decree or
order will be considered "final" until Extreme's right to appeal, if any, shall
have expired or been exhausted.)

     (g   Extreme shall breach the requirements of Paragraph 10, which by
reference to Schedule 1 establishes certain financial covenants and other
requirements.

     (h   as of the effective date of this Land Lease, any of the
representations or warranties of Extreme contained in subparagraphs 2(A) - (K)
of the Closing Certificate shall be false or misleading in any material respect.

     (i   Extreme shall fail to pay the full amount of any Supplemental
Payment required by the Purchase

[Land]

                                     -22-
<PAGE>

Agreement on the Designated Sale Date.

     (j   Extreme shall fail to comply with any term, provision or condition
of the Pledge Agreement after the expiration of any applicable notice and cure
period set forth in the Pledge Agreement.

     15.  Remedies.

          (a   Basic Remedies. At any time after an Event of Default and after
               --------------
BNPLC has given any notice required by subparagraph 15.(b), BNPLC shall be
entitled at BNPLC's option (and without limiting BNPLC in the exercise of any
other right or remedy BNPLC may have, and without any further demand or notice
except as expressly described in this subparagraph 15.(a)), to exercise any one
or more of the following remedies:

               (i   By notice to Extreme, BNPLC may terminate Extreme's right to
     possession of the Property. A notice given in connection with unlawful
     detainer proceedings specifying a time within which to cure a default shall
     terminate Extreme's right to possession if Extreme fails to cure the
     default within the time specified in the notice.

               (ii  Upon termination of Extreme's right to possession and
     without further demand or notice, BNPLC may re-enter the Property in any
     manner not prohibited by Applicable Law and take possession of all
     improvements, additions, alterations, equipment and fixtures thereon and
     remove any persons in possession thereof. Any property on the Land may be
     removed and stored in a warehouse or elsewhere at the expense and risk of
     and for the account of Extreme.

               (iii Upon termination of Extreme's right to possession, this Land
     Lease shall terminate and BNPLC may recover from Extreme:

                     a)  The worth at the time of award of the unpaid Rent which
          had been earned at the time of termination;

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

                     c)  The worth at the time of award of the amount by which
          the unpaid Rent for the balance of the scheduled Term after the time
          of award exceeds the amount of such rental loss that Extreme proves
          could be reasonably avoided; and

                     d)  Any other amount necessary to compensate BNPLC for all
          the detriment proximately caused by Extreme's failure to perform
          Extreme's obligations under this Land Lease or which in the ordinary
          course of things would be likely to result therefrom, including the
          costs and expenses (including Attorneys' Fees, advertising costs and
          brokers' commissions) of recovering possession of the Property,
          removing persons or property therefrom, placing the Property in good
          order, condition, and repair, preparing and altering the Property for
          reletting, all other costs and expenses of reletting, and any loss
          incurred by BNPLC as a result of Extreme's failure to perform
          Extreme's obligations under the other Operative Documents.

          The "worth at the time of award" of the amounts referred to in
          subparagraph 15.(a)(iii)a) and subparagraph 15.(a)(iii)b) shall be
          computed by allowing interest at the Default Rate. The "worth

[Land]

                                     -23-
<PAGE>

          at the time of award" of the amount referred to in subparagraph
          15.(a)(iii)c) 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 one percent (1%).

                     e)  Such other amounts in addition to or in lieu of the
          foregoing as may be permitted from time to time by applicable
          California law.

               (iv   BNPLC shall have the remedy described in California Civil
     Code Section 1951.4 (lessor may continue lease in force even after lessee's
     breach and abandonment and recover rent as it becomes due, if lessee has
     right to sublet or assign, subject only to reasonable limitations).
     Accordingly, even if Extreme has breached this Land Lease and abandoned the
     Property, this Land Lease shall continue in effect for so long as BNPLC
     does not terminate Extreme's right to possession, and BNPLC may enforce all
     of BNPLC's rights and remedies under this Land Lease, including the right
     to recover the Rent as it becomes due under this Land Lease. Extreme's
     right to possession shall not be deemed to have been terminated by BNPLC
     except pursuant to subparagraph 15.(a)(i) hereof. The following shall not
     constitute a termination of Extreme's right to possession:

                     a)  Acts of maintenance or preservation or efforts to relet
          the Property;

                     b)  The appointment of a receiver upon the initiative of
          BNPLC to protect BNPLC's interest under this Land Lease; or

                     c)  Reasonable withholding of consent to an assignment or
          subletting, or terminating a subletting or assignment by Extreme.

          (b   Notice Required So Long As the Purchase Option and Extreme's
               ------------------------------------------------------------
Initial Remarketing Rights and Obligations Continue Under the Purchase
----------------------------------------------------------------------
Agreement. So long as Extreme remains in possession of the Property and there
---------
has been no termination of the Purchase Option and Extreme's Initial Remarketing
Rights and Obligations as provided Paragraph 4 of the Purchase Agreement,
                                   -----------
BNPLC's right to exercise remedies provided in subparagraph 15.(a) will be
subject to the condition precedent that BNPLC shall have notified Extreme, at a
time when an Event of Default shall have occurred and be continuing, of BNPLC's
intent to exercise remedies provided in subparagraph 15.(a) at least sixty days
prior to exercising the remedies. The condition precedent is intended to provide
Extreme with an opportunity to exercise the Purchase Option or Extreme's Initial
Remarketing Rights and Obligations before losing possession of the Property
pursuant to subparagraph 15.(a). The condition precedent is not, however,
intended to extend any period for curing an Event of Default. Accordingly, if an
Event of Default has occurred, and regardless of whether any Event of Default is
then continuing, BNPLC may proceed immediately to exercise remedies provided in
subparagraph 15.(a) at any time after the earlier of (i) sixty days after BNPLC
has given such a notice to Extreme, (ii) any date upon which Extreme
relinquishes possession of the Property, or (iii) any termination of the
Purchase Option and Extreme's Initial Remarketing Rights and Obligations.

          (c   Enforceability. This Paragraph 15 shall be enforceable to the
               --------------
maximum extent not prohibited by Applicable Law, and the unenforceability of any
provision in this Paragraph shall not render any other provision unenforceable.

          (d   Remedies Cumulative. No right or remedy herein conferred upon or
               -------------------
reserved to BNPLC is intended to be exclusive of any other right or remedy, and
each and every such right and remedy shall be cumulative and in addition to any
other right or remedy given to BNPLC hereunder or now or hereafter existing in
favor of BNPLC under Applicable Law or in equity. In addition to other remedies
provided in this Land Lease,

[Land]

                                     -24-
<PAGE>

BNPLC shall be entitled, to the extent permitted by Applicable Law or in equity,
to injunctive relief in case of the violation, or attempted or threatened
violation, of any of the covenants, agreements, conditions or provisions of this
Land Lease, or to a decree compelling performance of any of the other covenants,
agreements, conditions or provisions of this Land Lease to be performed by
Extreme, or to any other remedy allowed to BNPLC at law or in equity. Nothing
contained in this Land Lease shall limit or prejudice the right of BNPLC to
prove for and obtain in proceedings for bankruptcy or insolvency of Extreme by
reason of the termination of this Land Lease, an amount equal to the maximum
allowed by any statute or rule of law in effect at the time when, and governing
the proceedings in which, the damages are to be proved, whether or not the
amount be greater, equal to, or less than the amount of the loss or damages
referred to above. Without limiting the generality of the foregoing, nothing
contained herein shall modify, limit or impair any of the rights and remedies of
BNPLC under the Purchase Documents, and BNPLC shall not be required to give the
sixty day notice described in subparagraph 15.(b) as a condition precedent to
any acceleration of the Designated Sale Date or to taking any action to enforce
the Purchase Documents.

     16.  Default by BNPLC. If BNPLC should default in the performance of any
of its obligations under this Land Lease, BNPLC shall have the time reasonably
required, but in no event less than thirty days, to cure such default after
receipt of notice from Extreme specifying such default and specifying what
action Extreme believes is necessary to cure the default. If Extreme prevails in
any litigation brought against BNPLC because of BNPLC's failure to cure a
default within the time required by the preceding sentence, then Extreme shall
be entitled to an award against BNPLC for the monetary damages proximately
caused to Extreme by such default.

     Notwithstanding the foregoing, BNPLC's right to cure as provided in this
Paragraph 16 will not in any event extend the time within which BNPLC must
remove Liens Removable by BNPLC as required by Paragraph 17 beyond the
Designated Sale Date.

     17.  Quiet Enjoyment. Provided Extreme pays the Base Rent and all
Additional Rent payable hereunder as and when due and payable and keeps and
fulfills all of the terms, covenants, agreements and conditions to be performed
by Extreme hereunder, BNPLC shall not during the Term disturb Extreme's
peaceable and quiet enjoyment of the Property; however, such enjoyment shall be
subject to the terms, provisions, covenants, agreements and conditions of this
Land Lease, to Permitted Encumbrances, to Development Documents and to any other
claims not constituting Liens Removable by BNPLC. If any Lien Removable by BNPLC
is claimed against the Property, BNPLC will remove the Lien Removable by BNPLC
promptly. Any breach by BNPLC of this Paragraph shall render BNPLC liable to
Extreme for any monetary damages proximately caused thereby, but as more
specifically provided in subparagraph 4.(b) above, no such breach shall entitle
Extreme to terminate this Land Lease or excuse Extreme from its obligation to
pay Rent.

     18.  Surrender Upon Termination. Unless Extreme or an Applicable Purchaser
purchases or has purchased BNPLC's entire interest in the Property pursuant to
the terms of the Purchase Agreement and BNPLC's entire interest in the
Improvements and other "Property" under (and as defined in) the Other Purchase
Agreement, Extreme shall, upon the termination of Extreme's right to occupancy,
surrender to BNPLC the Property, including Improvements constructed by Extreme
and fixtures and furnishings included in the Property, free of all Hazardous
Substances (including Permitted Hazardous Substances) and tenancies and with all
Improvements in substantially the same condition as of the date the same were
initially completed, excepting only (i) ordinary wear and tear that occurs
between the maintenance, repairs and replacements required by other provisions
of this Land Lease or the Other Lease Agreement, and (ii) demolition,
alterations and additions which are expressly permitted by the terms of this
Land Lease or the Other Lease Agreement and which have been completed by Extreme
in a good and workmanlike manner in accordance with all Applicable Laws. Any
movable furniture or movable personal property belonging to Extreme or any party
claiming under Extreme, if not removed at the time of such termination and if

[Land]

                                     -25-
<PAGE>

BNPLC shall so elect, shall be deemed abandoned and become the property of BNPLC
without any payment or offset therefor. If BNPLC shall not so elect, BNPLC may
remove such property from the Property and store it at Extreme's risk and
expense.

     Nothing in this Paragraph 18 will be construed to require Extreme to
surrender the Property to BNPLC during the continuation of any breach by BNPLC
of any obligation it has under the Purchase Agreement to convey the Property to
Extreme or an Applicable Purchaser.

     19.  Holding Over by Extreme. Should Extreme not purchase BNPLC's right,
title and interest in the Property as provided in the Purchase Agreement, but
nonetheless continue to hold the Property after the termination of this Land
Lease without BNPLC's consent, whether such termination occurs by lapse of time
or otherwise, such holding over shall constitute and be construed as a tenancy
from day to day only, at a daily Base Rent equal to: (i) Stipulated Loss Value
on the day in question, times (ii) the Default Rate for such day; divided by
(iii) three hundred and sixty; subject, however, to all of the terms,
provisions, covenants and agreements on the part of Extreme hereunder. No
payments of money by Extreme to BNPLC after the termination of this Land Lease
shall reinstate, continue or extend the Term of this Land Lease and no extension
of this Land Lease after the termination thereof shall be valid unless and until
the same shall be reduced to writing and signed by both BNPLC and Extreme.

     20.  Independent Obligations Evidenced by the Other Operative Documents.
Extreme acknowledges and agrees that nothing contained in this Land Lease shall
limit, modify or otherwise affect any of Extreme's obligations under the other
Operative Documents, which obligations are intended to be separate, independent
and in addition to, and not in lieu of, the obligations set forth herein. In the
event of any inconsistency between the express terms and provisions of the
Purchase Documents and the express terms and provisions of this Land Lease, the
express terms and provisions of the Purchase Documents shall control. In the
event of any inconsistency between the express terms and provisions of the
Closing Certificate and the express terms and provisions of this Land Lease, the
express terms and provisions of this Land Lease shall control; provided, nothing
herein will limit or impair Extreme's obligations under the Closing Certificate
following any expiration of termination of this Land Lease.

                         [The signature pages follow.]
[Land]

                                     -26-
<PAGE>

     IN WITNESS WHEREOF, Extreme and BNPLC have caused this Lease Agreement
(Land) to be executed as of June 1, 2000.

                                                "Extreme"

                                                EXTREME NETWORKS, INC.


                                                By:___________________________
                                                   Name:______________________
                                                   Title:_____________________
<PAGE>

[Continuation of signature pages to Lease Agreement (Land) dated to be effective
                                 June 1, 2000]



                                         "BNPLC"

                                         BNP LEASING CORPORATION


                                         By: _______________________________
                                             Lloyd G. Cox, Vice President
<PAGE>

                                   Exhibit A
                                   ---------

                               Legal Description

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

[Land]
<PAGE>

                                   Exhibit B
                                   ---------

                            Insurance Requirements

I.   LIABILITY INSURANCE:

     A.   Extreme must maintain commercial general liability ("CGL") insurance
on an occurrence basis, affording immediate protection to the limit of not less
than $20,000,000 combined single limit for bodily and personal injury, death and
property damage in respect of any one occurrence. The CGL insurance must be
primary to, and shall receive no contribution from, any insurance policies or
self-insurance programs otherwise afforded to or available to the Interested
Parties, collectively or individually. Further, the CGL insurance must include
blanket contractual liability coverage which insures contractual liability under
the indemnifications set forth in this Land Lease (though such coverage or the
amount thereof shall in no way limit such indemnifications).

     B.   Any deductible or self-insured retention applicable to the CGL
insurance shall not exceed $500,000.

     C.   The forms of insurance policies (including endorsements) used to
provide the CGL insurance required by this Land Lease, and the insurance company
or companies providing the CGL insurance, must be acceptable to BNPLC. BNPLC
shall have the right from time to time and at any time to review and approve
such policy forms (including endorsements) and the insurance company or
companies providing the insurance. Without limiting the generality of the
foregoing, BNPLC may reasonably require (and unless and until Extreme is
otherwise notified by BNPLC, BNPLC does require) that such insurance be provided
under forms and by companies consistent with the following:

          (1)  Forms: CGL Insurance must be provided on Insurance Services
               -----
               Office ("ISO") forms CG 0001 1093 or CG 0001 0196 or equivalent
               substitute forms providing the same or greater coverage.

          (2)  Rating Requirements: Insurance must be provided through insurance
               -------------------
               or reinsurance companies rated by the A.M. Best Company of
               Oldwick, New Jersey as having a policyholder's rating of A or
               better and a reported financial information rating of X or
               better.

          (3)  Required Endorsements: CGL Insurance must be endorsed to provide
               ---------------------
               or include:

               (a)  ISO additional insured form CG 2026 1185 or equivalent
               substitute form, without modification (and under the commercial
               umbrella, if any), designating as additional insureds "BNPLC and
               other Interested Parties, as defined in the Common Definitions
               and Provisions Agreement (Land) between Extreme Networks, Inc.
               and BNP Leasing Corporation dated June 1, 2000)"; and

               (b)  provisions entitling BNPLC to 30 days' notice from the
               insurer prior to any cancellation of the CGL coverage.

          (4)  Other Insurance: Each policy to contain standard CGL "other
               ---------------
               insurance" wording, unmodified in any way that would make it
               excess over or contributory with the additional insured's own
               commercial general liability coverage.

[Land]
<PAGE>

III. OTHER INSURANCE RELATED REQUIREMENTS:

     A.   BNPLC must be notified in writing immediately by Extreme of claims
against Extreme that might cause a reduction below seventy-five percent (75%) of
any aggregate limit of any policy.

     B.   Extreme's CGL insurance must be evidenced by ACORD form 25
"Certificate of Insurance" completed and interlineated in a manner satisfactory
to BNPLC to show compliance with the requirements of this Exhibit. Copies of
endorsements to the CGL insurance must be attached to such form.

     C.   Such evidence of required insurance must be delivered upon execution
of this Land Lease and new certificate or evidence of insurance must be
delivered no later than 10 days prior to expiration of existing policy.

     D.   Extreme shall not cancel, fail to renew, or make or permit any
material reduction in any of the policies or certificates described in this
Exhibit without the prior written consent of BNPLC. The certificates (ACORD
forms 25) described in this Exhibit must contain the following express
provision:

     "This is to certify that the policies of insurance described herein have
     been issued to the insured Extreme Networks, Inc. for whom this certificate
     is executed and are in force at this time. In the event of cancellation of
     coverage affecting the certificate holder, at least thirty days prior
     notice shall be given to the certificate holder."

     E.   The limits of liability under the liability insurance required by this
Land Lease may be provided by a single policy of insurance or by a combination
of primary and umbrella policies, but in no event shall the total limits of
liability available for any one occurrence or accident be less than those
required by this Exhibit.

     F.   Extreme shall provide copies, certified as complete and correct by an
authorized agent of the applicable insurer, of all insurance policies required
by this Exhibit within ten days after receipt of a request for such copies from
BNPLC.

                              Exhibit B - Page 2

[Land]
<PAGE>

                                   Exhibit C
                                   ---------

                        Notice of LIBOR Period Election

BNP Leasing Corporation
12201 Merit Drive
Suite 860
Dallas, Texas 75251
Attention: Lloyd G. Cox

     Re: Lease Agreement (Improvements) and Lease Agreement (Land), both dated
as of June 1, 2000, and both between Extreme Networks, Inc., as tenant, and BNP
Leasing Corporation, as landlord

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the two Lease Agreements referenced above. This letter
constitutes notice to you that the LIBOR Period Election under both of the Lease
Agreements shall be:

                          ________________ month(s),

beginning with the first Base Rent Period that commences on or after:

                          ____________________, ____.


NOTE: YOU SHALL BE ENTITLED TO DISREGARD THIS NOTICE IF THE NUMBER OF MONTHS
----
SPECIFIED ABOVE IS NOT A PERMITTED NUMBER UNDER THE DEFINITION OF "LIBOR PERIOD
ELECTION" IN THE COMMON DEFINITIONS AND PROVISIONS AGREEMENTS REFERENCED IN THE
LEASE AGREEMENTS, OR IF THE DATE SPECIFIED ABOVE CONCERNING THE COMMENCEMENT OF
THE LIBOR PERIOD ELECTION IS LESS THAN TEN BUSINESS DAYS AFTER YOUR RECEIPT OF
THIS NOTICE. HOWEVER, WE ASK THAT YOU NOTIFY US IMMEDIATELY IF FOR ANY REASON
YOU BELIEVE THIS NOTICE IS DEFECTIVE.

     Executed this _____ day of ______________, 20__.


                                               Extreme Networks, Inc.

                                               Name:________________________
                                               Title:_______________________
[cc all Participants]

[Land]
<PAGE>

                                  Schedule 1
                                  ----------

                              FINANCIAL COVENANTS

[DRAFTING NOTE: TK WILL MANUALLY SUBSTITUTE THE FINAL SCHEDULE 1 (A SEPARATE
 -------------
WORD PROCESSING FILE) FOR THIS PAGE IN THE EXECUTION COPIES OF THIS DOCUMENT.]

[Land]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.9
<SEQUENCE>5
<FILENAME>0005.txt
<DESCRIPTION>FORM OF LEASE AGREEMENT (IMPROVEMENTS) JUNE 1, 2000
<TEXT>

<PAGE>

================================================================================


                                                                    EXHIBIT 10.9

                                  $48,000,000

                                LEASE AGREEMENT
                                (Improvements)




                                    BETWEEN



                            BNP LEASING CORPORATION

                                   ("BNPLC")



                                      AND



                            EXTREME NETWORKS, INC.

                                  ("Extreme")




                                 June 1, 2000

                           (Santa Clara, California)



================================================================================

[Improvements]
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
1.   Term.....................................................................................................    2
     (a)  Scheduled Term......................................................................................    2
          --------------
     (b)  Election by Extreme to Terminate After Accelerating the Designated Sale Date........................    2
          ----------------------------------------------------------------------------
     (c)  Extension of the Term...............................................................................    3
          ---------------------

2.   Use and Condition of the Property........................................................................    3
     (a)  Use.................................................................................................    3
          ---
     (b)  Condition of the Property...........................................................................    4
          -------------------------
     (c)  Consideration for and Scope of Waiver...............................................................    4
          -------------------------------------

3.   Rent.....................................................................................................    4
     (a)  Base Rent Generally.................................................................................    4
          -------------------
     (b)  Impact of Collateral Upon Formulas..................................................................    5
          ----------------------------------
     (c)  Calculation of and Due Dates for Base Rent..........................................................    5
          ------------------------------------------
          (i)    Determination of Payment Due Dates, Generally................................................    5
                 ---------------------------------------------
          (ii)   Special Adjustments to Base Rent Payment Dates and Periods...................................    6
                 ----------------------------------------------------------
          (iii)  Base Rent Formula for Periods During Which The Collateral Percentage is 100%.................    6
                 ----------------------------------------------------------------------------
          (iv)   Base Rent Formula for Periods During Which The Collateral Percentage is Less Than 100%.......    7
                 --------------------------------------------------------------------------------------
     (d)  Additional Rent.....................................................................................    8
          ---------------
     (e)  Arrangement Fee.....................................................................................    8
          ---------------
     (f)  Administrative Agency Fees..........................................................................    8
          --------------------------
     (g)  No Demand or Setoff.................................................................................    8
          -------------------
     (h)  Default Interest and Order of Application...........................................................    8
          -----------------------------------------

4.   Nature of this Agreement.................................................................................    8
     (a)  "Net" Lease Generally...............................................................................    8
          ---------------------
     (b)  No Termination......................................................................................    8
          --------------
     (c)  Tax Reporting.......................................................................................    9
          -------------
     (d)  Characterization of this Improvements Lease.........................................................   10
          -------------------------------------------

5.   Payment of Executory Costs and Losses Related to the Property............................................   10
     (a)  Impositions.........................................................................................   10
          -----------
     (b)  Increased Costs; Capital Adequacy Charges...........................................................   11
          -----------------------------------------
     (c)  Extreme's Payment of Other Losses; General Indemnification..........................................   12
          ----------------------------------------------------------
     (d)  Exceptions and Qualifications to Indemnities........................................................   13
          --------------------------------------------

6.   Initial Renovations......................................................................................   14
     (a)  Funds Advanced to Extreme From the Initial Funding Advance..........................................   14
          ----------------------------------------------------------
     (b)  Quality and Timing of the Initial Renovations.......................................................   14
          ---------------------------------------------
     (c)  Control of Work.....................................................................................   14
          ---------------
     (d)  Adequacy of Drawings, Specifications and Budgets....................................................   14
          ------------------------------------------------
</TABLE>

[Improvements]
<PAGE>

<TABLE>
<S>                                                                                                           <C>
     (e)  Existing Condition of the Land and Improvements..................................................... 15
          -----------------------------------------------
     (f)  Clean Up............................................................................................ 15
          --------
     (g)  No Damage for Delays................................................................................ 15
          --------------------
     (h)  No Fee For Construction Management.................................................................. 15
          ----------------------------------

7.   Status of Property Acquired With Funds Provided by BNPLC................................................. 15

8.   Environmental............................................................................................ 16
     (a)  Environmental Covenants by Extreme.................................................................. 16
          ----------------------------------
     (b)  Right of BNPLC to do Remedial Work Not Performed by Extreme......................................... 16
          -----------------------------------------------------------
     (c)  Environmental Inspections and Reviews............................................................... 17
          -------------------------------------
     (d)  Communications Regarding Environmental Matters...................................................... 17
          ----------------------------------------------

9.   Insurance Required and Condemnation...................................................................... 18
     (a)  Liability Insurance................................................................................. 18
          -------------------
     (b)  Property Insurance.................................................................................. 18
          ------------------
     (c)  Failure to Obtain Insurance......................................................................... 19
          ---------------------------
     (d)  Condemnation........................................................................................ 19
          ------------

10.  Application of Insurance and Condemnation Proceeds....................................................... 19
     (a)  Collection and Application of Insurance and Condemnation Proceeds Generally......................... 19
          ---------------------------------------------------------------------------
     (b)  Advances of Escrowed Proceeds to Extreme............................................................ 20
          ----------------------------------------
     (c)  Application of Escrowed Proceeds as a Qualified Prepayment.......................................... 20
          ----------------------------------------------------------
     (d)  Special Provisions Applicable After Completion of Initial Renovations............................... 20
          ---------------------------------------------------------------------
     (e)  Special Provisions Applicable After an Event of Default............................................. 20
          -------------------------------------------------------
     (f)  Extreme's Obligation to Restore..................................................................... 21
          -------------------------------
     (g)  Takings of All or Substantially All of the Property................................................. 21
          ---------------------------------------------------

11.  Additional Representations, Warranties and Covenants of Extreme Concerning the Property.................. 21
     (a)  Compliance with Covenants and Laws.................................................................. 21
          ----------------------------------
     (b)  Operation of the Property........................................................................... 21
          -------------------------
     (c)  Debts for Construction, Maintenance, Operation or Development....................................... 22
          -------------------------------------------------------------
     (d)  Repair, Maintenance, Alterations and Additions...................................................... 23
          ----------------------------------------------
     (e)  Permitted Encumbrances and Development Documents.................................................... 23
          ------------------------------------------------
     (f)  Books and Records Concerning the Property........................................................... 23
          -----------------------------------------

12.  Financial Covenants, Reporting Covenants and Other Covenants Incorporated
     by Reference to Schedule 1............................................................................... 24
                     ----------

13.  Assignment and Subletting by Extreme..................................................................... 24
     (a)  BNPLC's Consent Required............................................................................ 24
          ------------------------
     (b)  Standard for BNPLC's Consent to Assignments and Certain Other Matters............................... 24
          ---------------------------------------------------------------------
     (c)  Consent Not a Waiver................................................................................ 24
          --------------------

14.  Assignment by BNPLC...................................................................................... 24
     (a)  Restrictions on Transfers........................................................................... 24
          -------------------------
     (b)  Effect of Permitted Transfer or other Assignment by BNPLC........................................... 25
          ---------------------------------------------------------

15.  BNPLC's Right of Access.................................................................................. 25
</TABLE>

[Improvements]
<PAGE>

<TABLE>
<S>                                                                                                           <C>
16.  Events of Default.......................................................................................  26

17.  Remedies................................................................................................  28
     (a)  Basic Remedies.....................................................................................  28
          --------------
     (b)  Notice Required So Long As the Purchase Option and Extreme's Initial Remarketing
          --------------------------------------------------------------------------------
          Rights and Obligations Continue Under the Purchase Agreement.......................................  29
          ------------------------------------------------------------
     (c)  Enforceability.....................................................................................  30
          --------------
     (d)  Remedies Cumulative................................................................................  30
          -------------------

18.  Default by BNPLC........................................................................................  30

19.  Quiet Enjoyment.........................................................................................  30

20.  Surrender Upon Termination..............................................................................  31

21.  Holding Over by Extreme.................................................................................  31

22.  Independent Obligations Evidenced by the Other Operative Documents......................................  31
</TABLE>

[Improvements]
<PAGE>

                            Exhibits and Schedules

<TABLE>
<S>                                   <C>
Exhibit A..........................                            Legal Description
---------

Exhibit B..........................                       Insurance Requirements
---------

Exhibit C..........................                   LIBOR Period Election Form
---------

Schedule 1.........................   Financial Covenants and Other Requirements
----------
</TABLE>

[Improvements]

                                     (IV)
<PAGE>

                                LEASE AGREEMENT

                                (IMPROVEMENTS)

         This LEASE AGREEMENT (IMPROVEMENTS) (this "Improvements Lease") is made
and dated as of June 1, 2000 (the "Effective Date") by and between BNP LEASING
CORPORATION, a Delaware corporation ("BNPLC"), and EXTREME NETWORKS, INC., a
Delaware corporation ("Extreme").

                                   RECITALS

         Contemporaneously with the execution of this Improvements Lease, BNPLC
and Extreme are executing a Common Definitions and Provisions Agreement
(Improvements) dated as of the Effective Date (the "Common Definitions and
Provisions Agreement (Improvements)"), which by this reference is incorporated
into and made a part of this Improvements Lease for all purposes. As used in
this Improvements Lease, capitalized terms defined in the Common Definitions and
Provisions Agreement (Improvements) and not otherwise defined in this
Improvements Lease are intended to have the respective meanings assigned to them
in the Common Definitions and Provisions Agreement (Improvements).

         Pursuant to the Acquisition Contract, which covers the Land described
in Exhibit A, BNPLC is acquiring the Land and any appurtenances thereto and all
existing Improvements thereon from Seller contemporaneously with the execution
of this Improvements Lease.

         In anticipation of BNPLC's acquisition of the Land and the existing
Improvements thereon under the Acquisition Contract, BNPLC and Extreme have
reached agreement as to the terms and conditions upon which BNPLC is willing to
lease the existing Improvements and the Improvements to be constructed on the
Land as hereinafter provided, and by this Improvements Lease BNPLC and Extreme
desire to evidence such agreement.

                               GRANTING CLAUSES

         BNPLC does hereby LEASE, DEMISE and LET unto Extreme for the term
hereinafter set forth all right, title and interest of BNPLC, now owned or
hereafter acquired, in and to:

               (1)  any and all Improvements; and

               (2)  all easements and other rights appurtenant to the
         Improvements, whether now owned or hereafter acquired by BNPLC.

BNPLC's interest in all property described in clauses (1) and (2) above are
hereinafter referred to collectively as the "Real Property". The Real Property
does not include the Land itself, it being understood that the Other Lease
Agreement constitutes a separate lease of the Land and the appurtenances
thereto, and only the Land and the appurtenances thereto, from BNPLC to Extreme.

         To the extent, but only to the extent, that assignable rights or
interests in, to or under the following have been or will be acquired by BNPLC
under the Acquisition Contract or acquired by BNPLC pursuant to Paragraph 7
below, BNPLC also hereby grants and assigns to Extreme for the term of this
Improvements Lease the right to use and enjoy (and, in the case of contract
rights, to enforce) such rights or interests of BNPLC:

[Improvements]
<PAGE>

               (a)  any goods, equipment, furnishings, furniture and other
         tangible personal property of whatever nature that are located on the
         Land and all renewals or replacements of or substitutions for any of
         the foregoing;

               (b)  the benefits, if any, conferred upon the owner of the Real
         Property by the Permitted Encumbrances (including the right to receive
         rents under and to otherwise enforce the Premises Leases) and
         Development Documents; and

               (c)  any permits, licenses, franchises, certificates, and other
         rights and privileges against third parties related to the Real
         Property.

Such rights and interests of BNPLC, whether now existing or hereafter arising,
are hereinafter collectively called the "Personal Property". The Real Property
and the Personal Property are hereinafter sometimes collectively called the
"Property."

          However, the leasehold estate conveyed hereby and Extreme's rights
hereunder are expressly made subject and subordinate to the terms and conditions
of this Improvements Lease, the Premises Leases and all other Permitted
Encumbrances, and to any other claims or encumbrances not constituting Liens
Removable by BNPLC.

                         GENERAL TERMS AND CONDITIONS

         The Property is leased by BNPLC to Extreme and is accepted and is to be
used and possessed by Extreme upon and subject to the following terms and
conditions:

         1     TERM.

               (a)  Scheduled Term. The term of this Improvements Lease (the
                    --------------
"Term") shall commence on and include the Effective Date, and end on the first
Business Day of July, 2005, unless sooner terminated as expressly herein
provided.

               (b)  Election by Extreme to Terminate After Accelerating the
                    -------------------------------------------------------
Designated Sale Date. Extreme shall be entitled to accelerate the Designated
--------------------
Sale Date (and thus accelerate the purchase of BNPLC's interest in the Property
by Extreme or by an Applicable Purchaser pursuant to the Purchase Agreement) by
sending a notice to BNPLC as provided in clause (2) of the definition of
"Designated Sale Date" in the Common Definitions and Provisions Agreement
(Improvements). In the event, because of Extreme's election to so accelerate the
Designated Sale Date or for any other reason, the Designated Sale Date occurs
before the end of the scheduled Term, Extreme may terminate this Improvements
Lease on or after the Designated Sale Date; provided, however, as a condition to
any such termination by Extreme, Extreme must have done the following prior to
the termination:

               (i)   purchased or caused an Applicable Purchaser to purchase the
         Property pursuant to the Purchase Agreement and satisfied all of
         Extreme's other obligations under the Purchase Agreement;

               (ii)  paid to BNPLC all Base Rent and all other Rent due on or
         before or accrued through the Designated Sale Date; and

               (iii) paid any Breakage Costs caused by BNPLC's sale of the
         Property pursuant to the Purchase Agreement.

[Improvements]

                                      -2-
<PAGE>

          (c)  Extension of the Term. The Term may be extended at the option of
               ---------------------
Extreme for two successive periods of five years each; provided, however, that
prior to any such extension the following conditions must have been satisfied:
(A) at least one hundred eighty days prior to the commencement of any such
extension, BNPLC and Extreme must have agreed in writing upon, and received the
consent and approval of BNPLC's Parent and all other Participants to (1) a
corresponding extension not only to the date for the expiration of the Term
specified above in this Section, but also to the date specified in clause (1) of
the definition of Designated Sale Date in the Common Definitions and Provisions
Agreement (Improvements), and (2) an adjustment to the Rent that Extreme will be
required to pay for the extension, it being expected that the Rent for the
extension may be different than the Rent required for the original Term, and it
being understood that the Rent for any extension must in all events be
satisfactory to both BNPLC and Extreme, each in its sole and absolute
discretion; (B) no Event of Default shall have occurred and be continuing at the
time of Extreme's exercise of its option to extend; (C) prior to any such
extension, Extreme must have completed any Initial Renovations which it has
elected to undertake as described in Paragraph 6; and (D) immediately prior to
any such extension, this Improvements Lease must remain in effect. With respect
to the condition that BNPLC and Extreme must have agreed upon the Rent required
for any extension of the Term, neither Extreme nor BNPLC is willing to submit
itself to a risk of liability or loss of rights hereunder for being judged
unreasonable. Accordingly, both Extreme and BNPLC hereby disclaim any obligation
express or implied to be reasonable in negotiating the Rent for any such
extension. Subject to the changes to the Rent payable during any extension of
the Term as provided in this Paragraph, if Extreme exercises its option to
extend the Term as provided in this Paragraph, this Improvements Lease shall
continue in full force and effect, and the leasehold estate hereby granted to
Extreme shall continue without interruption and without any loss of priority
over other interests in or claims against the Property that may be created or
arise after the date hereof and before the extension.

     2    USE AND CONDITION OF THE PROPERTY.

          (a)    Use. Subject to the Permitted Encumbrances, the Development
                 ---
Documents and the terms hereof, Extreme may use and occupy the Property during
the Term, but only for the following purposes and other lawful purposes
incidental thereto:

          (i)    the making of Initial Renovations as described in Paragraph 6;

          (ii)   administrative and office space;

          (iii)  research and development, production, assembly, distribution
     and warehousing, in each case of products that are of substantially the
     same type and character as those regularly sold by Extreme in the ordinary
     course of its business as of the Effective Date;

          (iv)   cafeteria, library and other support facilities that Extreme
     may provide to its employees; and

          (vi)   other lawful purposes (including research and development or
     production of products that are not of substantially the same type and
     character as those regularly sold by Extreme in the ordinary course of its
     business as of the Effective Date) approved in advance and in writing by
     BNPLC, which approval will not be unreasonably withheld (but Extreme
     acknowledges that BNPLC's withholding of such approval shall be reasonable
     if BNPLC determines in good faith that (1) giving the approval may
     materially increase BNPLC's risk of liability for any existing or future
     environmental problem, or (2) giving the approval is likely to
     substantially increase BNPLC's administrative burden of complying with or
     monitoring Extreme's compliance with the requirements of this Improvements
     Lease or other Operative Documents).

[Improvements]

                                      -3-
<PAGE>

     Nothing in this subparagraph will prevent a tenant under a Premises Lease,
     executed prior to the Effective Date, from using the space covered thereby
     for purposes expressly authorized by the terms and conditions of such
     Premises Lease.

          (b)  Condition of the Property. Extreme acknowledges that it has
               -------------------------
carefully and fully inspected the Property and accepts the Property in its
present state, AS IS, and without any representation or warranty, express or
implied, as to the condition of such property or as to the use which may be made
thereof. Extreme also accepts the Property without any covenant, representation
or warranty, express or implied, by BNPLC or its Affiliates regarding the title
thereto or the rights of any parties in possession of any part thereof, except
as expressly set forth in Paragraph 19. BNPLC shall not be responsible for any
latent or other defect or change of condition in the Land or in Improvements,
fixtures and personal property forming a part of the Property or for any
violations with respect thereto of Applicable Laws. Further, BNPLC shall not be
required to furnish to Extreme any facilities or services of any kind, including
water, steam, heat, gas, air conditioning, electricity, light or power.

          (c)  Consideration for and Scope of Waiver. The provisions of
               -------------------------------------
subparagraph 2.(b) above have been negotiated by BNPLC and Extreme after due
consideration for the Rent payable hereunder and are intended to be a complete
exclusion and negation of any representations or warranties of BNPLC or its
Affiliates, express or implied, with respect to the Property that may arise
pursuant to any law now or hereafter in effect or otherwise, except as expressly
set forth herein.

     However, such exclusion of representations and warranties by BNPLC is not
intended to impair any representations or warranties made by other parties, the
benefit of which may pass to Extreme during the Term because of the definition
of Personal Property and Property above.

     3    RENT.

          (a)  Base Rent Generally. On each Base Rent Date through the end of
               -------------------
the Term, Extreme shall pay BNPLC rent ("Base Rent"), calculated as provided
below. Each payment of Base Rent must be received by BNPLC no later than 10:00
a.m. (Pacific time) on the date it becomes due; if received after 10:00 a.m.
(Pacific time) it will be considered for purposes of this Improvements Lease as
received on the next following Business Day. At least five days prior to each
Base Rent Date, BNPLC shall notify Extreme in writing of the amount of each
installment of Base Rent that will be required on that date, calculated as
provided below. Any failure by BNPLC to so notify Extreme, however, shall not
constitute a waiver of BNPLC's right to payment, but absent such notice Extreme
shall not be in default hereunder for any underpayment resulting therefrom if
Extreme, in good faith, reasonably estimates the payment required, makes a
timely payment of the amount so estimated and corrects any underpayment within
three Business Days after being notified by BNPLC of the underpayment.

          (b)  Impact of Collateral Upon Formulas. To ease the administrative
               ----------------------------------
burden of this Improvements Lease and the Pledge Agreement, the formulas for
calculating Base Rent set out below in subparagraph 3.(c) reflect a reduction in
the Base Rent equal to the interest that would accrue on any Collateral provided
in accordance with the requirements of the Pledge Agreement from time to time if
the Accounts (as defined in the Pledge Agreement) bore interest at the Deposit
Rate. BNPLC has agreed to such reduction to provide Extreme with the economic
equivalent of interest on such Collateral, and in return Extreme has agreed to
the provisions of the Pledge Agreement that excuse the actual payment of
interest on the Accounts. By incorporating such reduction of Base Rent into the
formulas below, and by providing for noninterest bearing Accounts in the Pledge
Agreement, an unnecessary and cumbersome periodic exchange of equal payments
will be avoided. It is not, however, the intent of BNPLC or Extreme to
understate Base Rent or interest for financial reporting purposes. Accordingly,
for purposes of any financial reports that this Improvements Lease requires of

[Improvements]

                                      -4-
<PAGE>

Extreme from time to time, Extreme may report Base Rent as if there had been no
such reduction and as if the Collateral from time to time provided in accordance
with the requirements of the Pledge Agreement had been maintained in Accounts
bearing interest at the Deposit Rate.

          (c)      Calculation of and Due Dates for Base Rent. Payments of Base
                   ------------------------------------------
Rent shall be calculated and become due as follows:


          (i)      Determination of Payment Due Dates, Generally.
                   ---------------------------------------------

                   a0 For all Base Rent Periods subject to a LIBOR Period
          Election of one month or three months, Base Rent shall be due in one
          installment on the Base Rent Date upon which the Base Rent Period
          ends.

                   b0 For Base Rent Periods subject to a LIBOR Period Election
          of six months, Base Rent shall be payable in two installments, with
          the first installment becoming due on the Base Rent Date that occurs
          on the first Business Day of the third calendar month following the
          commencement of such Base Rent Period, and with the second installment
          becoming due on the Base Rent Date upon which the Base Rent Period
          ends.

                   c0 For Base Rent Periods subject to a LIBOR Period Election
          of nine months, Base Rent shall be payable in three installments, with
          the first installment becoming due on the Base Rent Date that occurs
          on the first Business Day of the third calendar month following the
          commencement of such Base Rent Period, with the second installment
          becoming due on the first Business Day of the sixth calendar month
          following the commencement of such Base Rent Period, and with the
          third installment becoming due on the Base Rent Date upon which the
          Base Rent Period ends.

                   d0 For Base Rent Periods subject to a LIBOR Period Election
          of twelve months, Base Rent shall be payable in four installments,
          with the first installment becoming due on the Base Rent Date that
          occurs on the first Business Day of the third calendar month following
          the commencement of such Base Rent Period, with the second installment
          becoming due on the first Business Day of the sixth calendar month
          following the commencement of such Base Rent Period, with the third
          installment becoming due on the first Business Day of the ninth
          calendar month following the commencement of such Base Rent Period,
          and with the fourth installment becoming due on the Base Rent Date
          upon which the Base Rent Period ends.

          (ii)     Special Adjustments to Base Rent Payment Dates and Periods.
                   ----------------------------------------------------------
Notwithstanding the foregoing:

                   a0 Any Base Rent Period that begins before, and does not
          otherwise end before, the first Business Day of the first calendar
          month following a Failed Collateral Test Date shall end upon but not
          include such first Business Day, and such first Business Day shall
          constitute a Base Rent Date, upon which Extreme must pay all accrued,
          unpaid Base Rent for the Base Rent Period just ended.

                   b0 In addition to Base Rent due on a the first Business Day
          of the first calendar month following a Failed Collateral Test Date,
          Extreme must pay the Breakage Costs, if any, resulting from any early
          ending of a Base Rent Period pursuant to the preceding clause
          3.(c)(ii)a).

[Improvements]
                                      -5-
<PAGE>

                    c0 If Extreme or any Applicable Purchaser purchases BNPLC's
          interest in the Property pursuant to the Purchase Agreement, any
          accrued unpaid Base Rent and all outstanding Additional Rent shall be
          due on the date of purchase in addition to the purchase price and
          other sums due BNPLC under the Purchase Agreement.

          (iii)     Base Rent Formula for Periods During Which The Collateral
                    ---------------------------------------------------------
Percentage is 100%. Each installment of Base Rent payable for any Base Rent
------------------
Period during which the Collateral Percentage is one hundred percent (100%)
shall equal:

          .         Stipulated Loss Value on the first day of such Base Rent
                    Period, times

          .         the sum of (a) the Secured Spread and (b) the Effective
                    Rate/Deposit Rate Difference for the period from and
                    including the preceding Base Rent Date to but not including
                    the Base Rent Date upon which the installment is due, times

          .         the number of days in the period from and including the
                    preceding Base Rent Date to but not including the Base Rent
                    Date upon which the installment is due, divided by

          .         three hundred sixty.

          Assume, only for the purpose of illustration: that the Collateral
Percentage for a hypothetical Base Rent Period is one hundred percent (100%);
that prior to the first day of such Base Rent Period Qualified Prepayments have
been received by BNPLC, leaving a Stipulated Loss Value of $15,000,000; that the
sum of the Secured Spread and the Effective Rate/Deposit Rate Difference is
forty-two and one-half basis points (42.5/100 of 1%); and that such Base Rent
Period contains exactly thirty days. Under such assumptions, the Base Rent for
the hypothetical Base Rent Period will equal:

                         $15,000,000 x .425% x 30/360 = $5312.50

          (iv)      Base Rent Formula for Periods During Which The Collateral
Percentage is Less Than 100%. Each installment of Base Rent payable for any Base
Rent Period during which the Collateral Percentage is less than one hundred
percent (100%) shall equal:

          .         Stipulated Loss Value on the first day of such Base Rent
                    Period, times

          .         the sum of:


                         (A) the product of:

                              (1)  the Collateral Percentage for such Base Rent
                                   Period, times

                              (2)  the sum of (a) the Secured Spread and (b) the
                                   Effective Rate/Deposit Rate Difference for
                                   the period from and including the preceding
                                   Base Rent Date to but not including the Base
                                   Rent Date upon which the installment is due,
                                   plus



[Improvements]

                                      -6-
<PAGE>

                         (B) the product of:

                              (1)  one minus the Collateral Percentage for such
                                   Base Rent Period, times

                              (2)  the sum of (a) the Effective Rate with
                                   respect to such Base Rent Period, plus (b)
                                   the Unsecured Spread for the period from and
                                   including the preceding Base Rent Date to but
                                   not including the Base Rent Date upon which
                                   the installment is due, times

          .    the number of days in the period from and including the preceding
               Base Rent Date to but not including the Base Rent Date upon which
               the installment is due, divided by

          .    three hundred sixty.

          Assume, only for the purpose of illustration: that the Collateral
     Percentage for a hypothetical Base Rent Period is fifty-five percent (55%);
     that prior to the first day of such Base Rent Period Qualified Prepayments
     have been received by BNPLC, leaving a Stipulated Loss Value of
     $15,000,000; that the Effective Rate for the Base Rent Period is 6%; that
     the sum of the Secured Spread and the Effective Rate/Deposit Rate
     Difference is forty-two and one-half basis points (42.5/100 of 1%); that
     upon the commencement of such Base Rent Period the Unsecured Spread is two
     hundred twenty-five basis points (225/100 of 1%); and that such Base Rent
     Period contains exactly thirty days. Under such assumptions, the Base Rent
     for the hypothetical Base Rent Period will equal:

     $15,000,000 x {(55% x .425%) + ([1 - 55%] x [6% + 2.25%])} x 30/360 =
     $49,328.12

          (d)  Additional Rent. All amounts which Extreme is required to pay to
               ---------------
or on behalf of BNPLC pursuant to this Improvements Lease, together with every
charge, premium, interest and cost set forth herein which may be added for
nonpayment or late payment thereof, shall constitute rent (all such amounts,
other than Base Rent, are herein called "Additional Rent", and together Base
Rent and Additional Rent are herein sometimes called "Rent").

          (e)  Arrangement Fee. Upon execution and delivery of this Improvements
               ---------------
Lease by BNPLC, an Arrangement Fee (the "Arrangement Fee") will be paid to BNPLC
from the Initial Funding Advance (and thus be included in Stipulated Loss Value)
in the amount provided in the letter dated as of April 20, 2000 from BNPLC to
Extreme.

          (f)  Administrative Agency Fees. Upon execution and delivery of this
               --------------------------
Improvements Lease by BNPLC, an administrative agency fee (an "Administrative
Agency Fee") will be paid to BNPLC from the Initial Funding Advance (and thus be
included in Stipulated Loss Value) in the amount provided in the letter dated as
of April 20, 2000 from BNPLC to Extreme. Also, on each anniversary of the date
hereof, Extreme shall pay to BNPLC an administrative agency fee (also, an
"Administrative Agency Fee") in the amount set forth in the letter agreement
dated as of April 20, 2000 from BNPLC to Extreme.

[Improvements]

                                      -7-
<PAGE>

          (g)  No Demand or Setoff. Except as expressly provided herein,
               -------------------
Extreme shall pay all Rent without notice or demand and without counterclaim,
deduction, setoff or defense.

          (h)  Default Interest and Order of Application. All Rent shall bear
               -----------------------------------------
interest, if not paid when first due, at the Default Rate in effect from time to
time from the date due until paid; provided, that nothing herein contained will
be construed as permitting the charging or collection of interest at a rate
exceeding the maximum rate permitted under Applicable Laws. BNPLC shall be
entitled to apply any amounts paid by or on behalf of Extreme against any Rent
then past due in the order the same became due or in such other order as BNPLC
may elect.

     4    Nature of this Agreement.

          (a)  "Net" Lease Generally. Subject only to the exceptions listed in
               ---------------------
subparagraph 5.(d) below, it is the intention of BNPLC and Extreme that Base
Rent, the Arrangement Fees, Administrative Agency Fees, Upfront Syndication Fees
and other payments herein specified shall be absolutely net to BNPLC and that
Extreme shall pay all costs, expenses and obligations of every kind relating to
the Property or this Improvements Lease which may arise or become due,
including: (i) any taxes payable by virtue of BNPLC's receipt of amounts paid to
or on behalf of BNPLC in accordance with Paragraph 5; (ii) any amount for which
BNPLC is or becomes liable with respect to the Permitted Encumbrances or the
Development Documents; and (iii) any costs incurred by BNPLC (including
Attorneys' Fees) because of BNPLC's acquisition or ownership of any interest in
the Property or because of this Improvements Lease or the transactions
contemplated herein.

          (b)  No Termination. Except as expressly provided in this Improvements
               --------------
Lease itself, this Improvements Lease shall not terminate, nor shall Extreme
have any right to terminate this Improvements Lease, nor shall Extreme be
entitled to any abatement of the Rent, nor shall the obligations of Extreme
under this Improvements Lease be excused, for any reason whatsoever, including
any of the following: (i) any damage to or the destruction of all or any part of
the Property from whatever cause, (ii) the taking of the Property or any portion
thereof by eminent domain or otherwise for any reason, (iii) the prohibition,
limitation or restriction of Extreme's use or development of all or any portion
of the Property or any interference with such use by governmental action or
otherwise, (iv) any eviction of Extreme or of anyone claiming through or under
Extreme, (v) any default on the part of BNPLC under this Improvements Lease or
under any other agreement to which BNPLC and Extreme are parties, (vi) the
inadequacy in any way whatsoever of the design, construction, assembly or
installation of any improvements, fixtures or tangible personal property
included in the Property (it being understood that BNPLC has not made, does not
make and will not make any representation express or implied as to the adequacy
thereof), (vii) any latent or other defect in the Property or any change in the
condition thereof or the existence with respect to the Property of any
violations of Applicable Laws, (viii) any breach by Seller of the Acquisition
Contract or other agreements or promises or representations made in connection
with the Acquisition Contract, (ix) any breach of a Premises Lease by any lessee
thereunder, or (x) any other cause whether similar or dissimilar to the
foregoing. It is the intention of the parties hereto that the obligations of
Extreme hereunder shall be separate and independent of the covenants and
agreements of BNPLC, that Base Rent and all other sums payable by Extreme
hereunder shall continue to be payable in all events and that the obligations of
Extreme hereunder shall continue unaffected, unless the requirement to pay or
perform the same shall have been terminated or limited pursuant to an express
provision of this Improvements Lease. Without limiting the foregoing, Extreme
waives to the extent permitted by Applicable Laws, except as otherwise expressly
provided herein, all rights to which Extreme may now or hereafter be entitled by
law (including any such rights arising because of any implied "warranty of
suitability" or other warranty under Applicable Laws) (i) to quit, terminate or
surrender this Improvements Lease or the Property or any part thereof or (ii) to
any abatement, suspension, deferment or reduction of the Rent.

[Improvements]
                                      -8-
<PAGE>

     However, nothing in this subparagraph 4.(b) shall be construed as a
waiver by Extreme of any right Extreme may have at law or in equity to the
following remedies, whether because of BNPLC's failure to remove a Lien
Removable by BNPLC or because of any other default by BNPLC under this
Improvements Lease that continues beyond the period for cure provided in
Paragraph 18: (i) the recovery of monetary damages, (ii) injunctive relief in
case of the violation, or attempted or threatened violation, by BNPLC of any of
the express covenants, agreements, conditions or provisions of this Improvements
Lease which are binding upon BNPLC (including the confidentiality provisions set
forth in subparagraph 15.(c) below), or (iii) a decree compelling performance by
BNPLC of any of the express covenants, agreements, conditions or provisions of
this Improvements Lease which are binding upon BNPLC.

          (c)  Tax Reporting. BNPLC and Extreme shall report this Improvements
               -------------
Lease and the Purchase Agreement for federal income tax purposes as a
conditional sale unless prohibited from doing so by the Internal Revenue
Service. If the Internal Revenue Service shall challenge BNPLC's
characterization of this Improvements Lease and the Purchase Agreement as a
conditional sale for federal income tax reporting purposes, BNPLC shall notify
Extreme in writing of such challenge and consider in good faith any reasonable
suggestions by Extreme about an appropriate response. In any event, Extreme
shall (subject only to the limitations set forth in this subparagraph) indemnify
and hold harmless BNPLC from and against all liabilities, costs, additional
taxes (other than Excluded Taxes) and other expenses that may arise or become
due because of such challenge or because of any resulting recharacterization
required by the Internal Revenue Service, including any additional taxes that
may become due upon any sale under the Purchase Agreement to the extent (if any)
that such additional taxes are not offset by tax savings resulting from
additional depreciation deductions or other tax benefits to BNPLC of the
recharacterization. If BNPLC receives a written notice of any challenge by the
Internal Revenue Service that BNPLC believes will be covered by this Paragraph,
then BNPLC shall promptly furnish a copy of such notice to Extreme. The failure
to so provide a copy of the notice to Extreme shall not excuse Extreme from its
obligations under this Paragraph; provided, that if none of the officers of
Extreme and none of the employees of Extreme responsible for tax matters are
aware of the challenge described in the notice and such failure by BNPLC renders
unavailable defenses that Extreme might otherwise assert, or precludes actions
that Extreme might otherwise take, to minimize its obligations hereunder, then
Extreme shall be excused from its obligation to indemnify BNPLC against
liabilities, costs, additional taxes and other expenses, if any, which would not
have been incurred but for such failure. For example, if BNPLC fails to provide
Extreme with a copy of a notice of a challenge by the Internal Revenue Service
covered by the indemnities set out in this Improvements Lease and Extreme is not
otherwise already aware of such challenge, and if as a result of such failure
BNPLC becomes liable for penalties and interest covered by the indemnities in
excess of the penalties and interest that would have accrued if Extreme had been
promptly provided with a copy of the notice, then Extreme will be excused from
any obligation to BNPLC to pay the excess.

          (d)  Characterization of this Improvements Lease. For purposes of
               -------------------------------------------
determining the appropriate financial accounting for this Improvements Lease and
for purposes of determining their respective rights and remedies under state
law, BNPLC and Extreme believe and intend that (i) this Improvements Lease
constitutes a true lease, not a mere financing arrangement, enforceable in
accordance with its express terms, and the preceding subparagraph is not
intended to affect the enforcement of any other provisions of this Improvements
Lease or the Purchase Agreement, and (ii) the Purchase Agreement shall
constitute a separate and independent contract, enforceable in accordance with
the express terms and conditions set forth therein. In this regard, Extreme
acknowledges that Extreme asked BNPLC to participate in the transactions
evidenced by this Improvements Lease and the Purchase Agreement as a landlord
and owner of the Property, not as a lender. Although other transactions might
have been used to accomplish similar results, Extreme expects to receive certain
material accounting and other advantages through the use of a lease transaction.
Accordingly, and notwithstanding the reporting for income tax purposes described
in the preceding subparagraph, Extreme cannot equitably deny that this
Improvements Lease and the Purchase Agreement should be construed and enforced
in accordance with their respective terms,

[Improvements]
                                      -9-
<PAGE>

rather than as a mortgage or other security device, in any action brought by
BNPLC to enforce this Improvements Lease or the Purchase Agreement.

     5    Payment of Executory Costs and Losses Related to the Property.

          (a)  Impositions. Subject only to the exceptions listed in
               -----------
subparagraph 5.(d) below, Extreme shall pay or cause to be paid prior to
delinquency all ad valorem taxes assessed against the Property and other
Impositions. If requested by BNPLC from time to time, Extreme shall furnish
BNPLC with receipts showing payment of all Impositions prior to the applicable
delinquency date therefor.

     Notwithstanding the foregoing, Extreme may in good faith, by appropriate
proceedings, contest the validity, applicability or amount of any asserted
Imposition, and pending such contest Extreme shall not be deemed in default
under any of the provisions of this Improvements Lease because of the Imposition
if (1) Extreme diligently prosecutes such contest to completion in a manner
reasonably satisfactory to BNPLC, and (2) Extreme promptly causes to be paid any
amount adjudged by a court of competent jurisdiction to be due, with all costs,
penalties and interest thereon, promptly after such judgment becomes final;
provided, however, in any event each such contest shall be concluded and the
contested Impositions must be paid by Extreme prior to the earlier of (i) the
date that any criminal prosecution is instituted or overtly threatened against
BNPLC or its directors, officers or employees because of the nonpayment thereof
or (ii) the date any writ or order is issued under which any property owned or
leased by BNPLC (including the Property) may be seized or sold or any other
action is taken against BNPLC or against any property owned or leased by BNPLC
because of the nonpayment thereof, or (iii) any Designated Sale Date upon which,
for any reason, Extreme or an Affiliate of Extreme or any Applicable Purchaser
shall not purchase BNPLC's interest in the Property pursuant to the Purchase
Agreement for a price to BNPLC (when taken together with any additional payments
made by Extreme pursuant to Paragraph 1(A)(2) of the Purchase Agreement, in the
                            -----------------
case of a purchase by an Applicable Purchaser) equal to the Break Even Price.

          (b)  Increased Costs; Capital Adequacy Charges. Subject only to the
               -----------------------------------------
exceptions listed in subparagraph 5.(d) below:

          (i)  If after the Effective Date there shall be any increase in the
     cost to BNPLC's Parent or any other Participant agreeing to make or making,
     funding or maintaining advances to BNPLC in connection with the Property
     because of any Banking Rules Change, then Extreme shall from time to time,
     pay to BNPLC for the account of BNPLC's Parent or such other Participant,
     as the case may be, additional amounts sufficient to compensate BNPLC's
     Parent or the Participant for such increased cost. An increase in costs
     resulting from any imposition or increase of reserve requirements
     applicable to Collateral held from time to time by BNPLC's Parent or other
     Participants pursuant to the Pledge Agreement would be an increase covered
     by the preceding sentence. A certificate as to the amount of such increased
     cost, submitted to BNPLC and Extreme by BNPLC's Parent or the other
     Participant, shall be conclusive and binding upon Extreme, absent clear and
     demonstrable error.

          (ii) BNPLC's Parent or any other Participant may demand additional
     payments ("Capital Adequacy Charges") if BNPLC's Parent or the other
     Participant determines that any Banking Rules Change affects the amount of
     capital to be maintained by it and that the amount of such capital is
     increased by or based upon the existence of advances made or to be made to
     BNPLC to permit BNPLC to maintain BNPLC's investment in the Property. To
     the extent that BNPLC's Parent or another Participant demands Capital
     Adequacy Charges as compensation for the additional capital requirements
     reasonably allocable to such investment or advances, Extreme shall pay to
     BNPLC for the account of BNPLC's Parent or the other Participant, as the
     case may be, the amount so demanded. Without limiting the foregoing, BNPLC
     and

[Improvements]
                                     -10-
<PAGE>

     Extreme hereby acknowledge and agree that the provisions for calculating
     Base Rent set forth herein reflect the assumption that the Pledge Agreement
     will cause a zero percent (0%) risk weight to be assigned to a percentage
     (equal to the Collateral Percentage) of the collective investment of BNPLC
     and the Participants in the Property pursuant to 12 Code of Federal
     Regulations, part 225, as from time to time supplemented or amended, or
     pursuant to any other similar or successor statute or regulation applicable
     to BNPLC and the Participants. If and so long as such risk weight is
     increased above the assumed amount of zero percent (0%) because of a
     Banking Rules Change, Capital Adequacy Charges may be collected to yield
     the same rate of return to BNPLC, BNPLC's Parent and any other Participants
     (net of their costs of maintaining required capital) that they would have
     enjoyed from this Improvements Lease absent such increase.

          (iii)     Notwithstanding the foregoing provisions of this
     subparagraph 5.(b), Extreme shall not be obligated pay any claim for
     compensation pursuant to this subparagraph 5.(b) arising or accruing more
     than six months prior to the date Extreme is notified that BNPLC or a
     Participant intends to make the claim; provided, however, that Extreme
     shall not be excused by this subparagraph from providing such compensation
     for any period during which notice on behalf of BNPLC or the Participant,
     as the case may be, could not be provided because of the retroactive
     application of the statute, regulation or other basis for the claim.

          (iv)     Any amount required to be paid by Extreme under this
     subparagraph 5.(b) shall be due fifteen days after a notice requesting such
     payment is received by Extreme.

          (c)      Extreme's Payment of Other Losses; General Indemnification.
                   ----------------------------------------------------------
Subject only to the exceptions listed in subparagraph 5.(d) below:


          (i)       All Losses (including Environmental Losses) asserted against
     or incurred or suffered by BNPLC or other Interested Parties at any time
     and from time to time by reason of, in connection with or arising out of
     (A) their ownership or alleged ownership of any interest in the Property or
     the Rents, (B) the use and operation of the Property, (C) the negotiation,
     administration or enforcement of the Operative Documents, (D) the making of
     Funding Advances, (E) any construction undertaken by Extreme or others on
     its behalf on or about the Property, (F) any Premises Lease, (G) the breach
     by Extreme of this Improvements Lease or any other document executed by
     Extreme in connection herewith, (H) any failure of the Property or Extreme
     itself to comply with Applicable Laws, (I) Permitted Encumbrances, (J)
     Hazardous Substance Activities, including those occurring prior to
     Effective Date, (K) any obligations under the Acquisition Contract that
     survive the closing under the Acquisition Contract, or (L) any bodily or
     personal injury or death or property damage occurring in or upon or in the
     vicinity of the Property through any cause whatsoever, shall be paid by
     Extreme, and Extreme shall indemnify and defend BNPLC and other Interested
     Parties from and against all such Losses.

          (ii)      THE INDEMNITIES AND RELEASES PROVIDED HEREIN FOR THE BENEFIT
     OF BNPLC AND OTHER INTERESTED PARTIES, INCLUDING THE INDEMNITY SET FORTH IN
        -----           -          -
     THE PRECEDING SUBPARAGRAPH 5.(c)(i), SHALL APPLY EVEN IF AND WHEN THE
     SUBJECT MATTERS OF THE INDEMNITIES AND RELEASES ARE CAUSED BY OR ARISE OUT
     OF THE NEGLIGENCE OR STRICT LIABILITY OF BNPLC OR ANOTHER INTERESTED PARTY.
                                              -----            -          -
     FURTHER, SUCH INDEMNITIES AND RELEASES WILL APPLY EVEN IF INSURANCE
     OBTAINED BY EXTREME OR REQUIRED OF EXTREME BY THIS IMPROVEMENTS LEASE OR
                                                        -            -
     OTHER OPERATIVE DOCUMENTS IS NOT ADEQUATE TO COVER LOSSES AGAINST OR FOR
           -         -                                  -
     WHICH THE INDEMNITIES AND RELEASES ARE

[Improvements]

                                     -11-
<PAGE>

     PROVIDED. EXTREME'S LIABILITY, HOWEVER, FOR ANY FAILURE TO OBTAIN INSURANCE
     REQUIRED BY THIS IMPROVEMENTS LEASE OR OTHER OPERATIVE DOCUMENTS WILL NOT
                      -            -              -         -
     BE LIMITED TO LOSSES AGAINST WHICH INDEMNITIES ARE PROVIDED HEREIN, IT
                   -
     BEING UNDERSTOOD THAT SUCH INSURANCE IS INTENDED TO DO MORE THAN PROVIDE A
     SOURCE OF PAYMENT FOR LOSSES AGAINST WHICH BNPLC AND OTHER INTERESTED
                           -                    -----           -
     PARTIES ARE ENTITLED TO INDEMNIFICATION BY THIS IMPROVEMENTS LEASE.
     -                                               -            -

          (iii)     Costs and expenses for which Extreme shall be responsible
     pursuant to this subparagraph 5.(c) will include appraisal fees, filing and
     recording fees, inspection fees, survey fees, taxes, brokerage fees and
     commissions, abstract fees, title policy fees, Uniform Commercial Code
     search fees, escrow fees and Attorneys' Fees incurred by BNPLC with respect
     to the Property, whether such costs and expenses are incurred at the time
     of execution of this Improvements Lease or at any time during the Term.

          (iv)      Extreme's obligations under this subparagraph 5.(c) shall
     survive the termination or expiration of this Improvements Lease. Any
     amount to be paid by Extreme under this subparagraph 5.(c) shall be due
     fifteen days after a notice requesting such payment is received by Extreme.

          (v)       If an Interested Party notifies Extreme of any claim or
     proceeding included in, or any investigation or allegation concerning,
     Losses for which Extreme is responsible pursuant to this subparagraph
     5.(c), Extreme shall assume on behalf of the Interested Party and conduct
     with due diligence and in good faith the investigation and defense thereof
     and the response thereto with counsel selected by Extreme, but reasonably
     satisfactory to the Interested Party; provided, that the Interested Party
     shall have the right to be represented by advisory counsel of its own
     selection and at its own expense; and provided further, that if any such
     claim, proceeding, investigation or allegation involves both Extreme and
     the Interested Party and the Interested Party shall have reasonably
     concluded that there are legal defenses available to it which are
     inconsistent with or in addition to those available to Extreme, then the
     Interested Party shall have the right to select separate counsel to
     participate in the investigation and defense of and response to such claim,
     proceeding, investigation or allegation on its own behalf, and Extreme
     shall pay or reimburse the Interested Party for all Attorney's Fees
     incurred by the Interested Party because of the selection of such separate
     counsel. If Extreme fails to assume promptly (and in any event within
     fifteen days after being notified of the applicable claim, proceeding,
     investigation or allegation) the defense of the Interested Party, then the
     Interested Party may contest (or settle, with the prior consent of Extreme,
     which consent will not be unreasonably withheld) the claim, proceeding,
     investigation or allegation at Extreme's expense using counsel selected by
     the Interested Party. Moreover, if any such failure by Extreme continues
     for forty-five days or more after Extreme is notified of any such claim,
     proceeding, investigation or allegation, the Interested Party may elect not
     to contest or continue contesting the same and instead, in accordance with
     the written advice of counsel, settle (or pay in full) all claims related
     thereto without Extreme's consent and without releasing Extreme from any
     obligations to the Interested Party under this subparagraph 5.(c).

          (d)       Exceptions and Qualifications to Indemnities.
                    --------------------------------------------

          (i)       BNPLC acknowledges and agrees that nothing in subparagraph
     4.(a) or the preceding subparagraphs of this Paragraph 5 shall be construed
     to require Extreme to pay or reimburse (w) any costs or expenses incurred
     by any Interested Party (including BNPLC or any transferee of BNPLC) to
     accomplish any Permitted Transfers described in clauses (1), (2), (3), (4)
     or (6) of the definition thereof in the Common Definitions and Provisions
     Agreement (Improvements), (x) Excluded Taxes, (y) Losses

[Improvements]

                                     -12-
<PAGE>

     incurred or suffered by any Interested Party that are proximately caused by
     (and attributed by any applicable principles of comparative fault to) the
     Established Misconduct of that Interested Party, or (z) Losses incurred or
     suffered in connection with the execution of the Participation Agreement or
     Pledge Agreement by Participants (or supplements making them parties
     thereto) or in connection with any negotiation or due diligence
     Participants may undertake before entering into the Participation Agreement
     or Pledge Agreement. Further, without limiting BNPLC's rights (as provided
     in other provisions of this Improvements Lease and other Operative
     Documents) to include the following in the calculation of Stipulated Loss
     Value and the Break Even Price (as applicable) or to collect Base Rent, a
     Supplemental Payment and other amounts, the calculation of which depends
     upon Stipulated Loss Value or the Break Even Price, BNPLC acknowledges and
     agrees that nothing in subparagraph 4.(a) or the preceding subparagraphs of
     this Paragraph 5 shall be construed to require Extreme to pay or reimburse
     an Interested Party for costs paid by BNPLC with the proceeds of the
     Initial Funding Advance as part of the Transaction Expenses.

     Further, if an Interested Party receives a written notice of Losses that
     such Interested Party believes are covered by the indemnity in subparagraph
     5.(c)(i), then such Interested Party will be expected to promptly furnish a
     copy of such notice to Extreme. The failure to so provide a copy of the
     notice to Extreme shall not excuse Extreme from its obligations under
     subparagraph 5.(c)(i); provided, that if Extreme is unaware of the matters
     described in the notice and such failure renders unavailable defenses that
     Extreme might otherwise assert, or precludes actions that Extreme might
     otherwise take, to minimize its obligations, then Extreme shall be excused
     from its obligation to indemnify such Interested Party (and any Affiliate
     of such Interested Party) against the Losses, if any, which would not have
     been incurred or suffered but for such failure. For example, if BNPLC fails
     to provide Extreme with a copy of a notice of an obligation covered by the
     indemnity set out in subparagraph 5.(c)(i) and Extreme is not otherwise
     already aware of such obligation, and if as a result of such failure BNPLC
     becomes liable for penalties and interest covered by the indemnity in
     excess of the penalties and interest that would have accrued if Extreme had
     been promptly provided with a copy of the notice, then Extreme will be
     excused from any obligation to BNPLC (or any Affiliate of BNPLC) to pay the
     excess.
     6    Initial Renovations.

          (a)  Funds Advanced to Extreme From the Initial Funding Advance. As
               ----------------------------------------------------------
provided in the definition of Initial Funding Advance in the Common Definitions
and Provisions Agreement, the Initial Funding Advance includes a sum paid to
Extreme, which Extreme will expend for BNPLC, to cover the cost of renovating,
remodeling, improving and furnishing existing Improvements as described
generally in Schedule 2 (collectively, the "Initial Renovations"). The Initial
Renovations shall become and remain part of the Improvements and owned by BNPLC
as provided herein. To the extent, if any, that funds received by Extreme from
the Initial Funding Advance for the Initial Renovations exceed the actual cost
thereof, such excess shall for the benefit of BNPLC be paid by Extreme to BNPLC
(with a notice designating such payment as a Qualified Prepayment made pursuant
to this subparagraph) no later than the first day of the first Base Rent Period
to commence after the first anniversary of the Effective Date.

          (b)  Quality and Timing of the Initial Renovations. Any Initial
               ---------------------------------------------
Renovations that Extreme elects to undertake must be completed by Extreme no
later than the first anniversary of the Effective Date (a) in a safe and good
and workmanlike manner, (b) in accordance with Applicable Laws, (c) in
compliance with (i) the other provisions of this Lease, (ii) the material
provisions of the Permitted Encumbrances and (iii) the material provisions of
the Development Documents, and (d) in a manner that, upon completion and taken
as a whole, enhances the value of the Property by an amount commensurate with
the funds from the Initial Funding Advance used by Extreme to pay the cost
thereof.


[Improvements]

                                     -13-
<PAGE>

          (c)       Control of Work. Subject to the other terms and conditions
                    ---------------
set forth in this Lease, Extreme shall have the sole right to initiate and
control all Initial Renovations undertaken by it, including the means, methods,
sequences and procedures implemented to accomplish the design and construction
involved in making the Initial Renovations.

          (d)       Adequacy of Drawings, Specifications and Budgets. BNPLC has
                    ------------------------------------------------
made and will make no representations as to the adequacy of any budgets, site
plans, renderings, plans, drawings or specifications for the Initial
Renovations, and no modification of any such budgets, site plans, renderings,
plans, drawings or specifications that may be required from time to time will
entitle Extreme to any adjustment in the amount that has been paid to Extreme as
described in the definition of Initial Funding Advance in the Common Definitions
and Provisions Agreement.

          (e)       Existing Condition of the Land and Improvements. Extreme is
                    -----------------------------------------------
familiar with the conditions of the Land and any existing Improvements on the
Land. Extreme shall have no claim for damages against BNPLC or for any
additional payment from BNPLC by reason of any condition (concealed or
otherwise) of or affecting the Land or Improvements.

          (f        Clean Up. Upon the completion of all such work, Extreme will
                    --------
remove all waste material and rubbish from and about the Land, as well as all
tools, construction equipment, machinery and surplus materials. Extreme will
keep the Land and the Improvements thereon in a reasonably safe and sightly
condition as such work progresses.

          (g        No Damage for Delays. Extreme shall have no claim for
                    --------------------
damages against BNPLC or for any additional payment from BNPLC by reason of any
delay in the work required to accomplish the Initial Renovations. Nor shall
Extreme have any claim for an extension of the deadline specified in
subparagraph 6.(b) for completing any Initial Renovations because of any such
period of delay, unless, however, such delay has been caused by BNPLC's
intentional interference with such work. In the event (and only to the extent)
that any such intentional interference by BNPLC continues after Extreme provides
written notice to cease, Extreme shall be entitled to an extension of such
deadline. BNPLC's exercise of its rights and remedies permitted under this Lease
or the other Operative Documents will not be construed as intentional
interference with Extreme's performance of any such work.

          (h        No Fee For Construction Management. Extreme shall have no
                    ----------------------------------
claim for any fee or other compensation or for any reimbursement of internal
administrative or overhead expenses of Extreme by reason of the Initial
Renovations (or any other services provided by Extreme under this Lease or other
Operative Documents), it being understood that Extreme is executing this Lease
in consideration of the rights expressly granted to it herein. Further, for
purposes of calculating any Qualified Prepayment that Extreme must make as
described in subparagraph 6.(a), no such fee or other compensation or internal
administrative or overhead expenses of Extreme shall be included in the actual
costs of any Initial Renovations.

     7.   Status of Property Acquired With Funds Provided by BNPLC. All
Improvements constructed during the term of this Improvements Lease shall be
owned by BNPLC and shall constitute "Property" covered by this Improvements
Lease. Further, to the extent heretofore or hereafter acquired (in whole or in
part) with any portion of the Initial Funding Advance or with other funds for
which Extreme has received or hereafter receives reimbursement from the Initial
Funding Advance, all furnishings, furniture, chattels, permits, licenses,
franchises, certificates and other personal property of whatever nature shall
have been acquired on behalf of BNPLC by Extreme, shall be owned by BNPLC and
shall constitute "Property" covered by this Improvements

[Improvements]

                                     -14-
<PAGE>

Lease, as shall all renewals or replacements of or substitutions for any such
Property. Extreme shall not authorize or permit the transfer of title to the
Improvements or to any other such Property to pass through Extreme or Extreme's
Affiliates before it is transferred to BNPLC from contractors, suppliers,
vendors or other third Persons. Nothing herein shall constitute authorization of
Extreme, as agent, to bind BNPLC to any construction contract or other agreement
with a third Person, but any construction contract or other agreement executed
by Extreme for the acquisition or construction of Improvements or other
components of the Property may provide for the transfer of title as required by
the preceding sentence. Upon request of BNPLC, Extreme shall deliver to BNPLC an
inventory describing all significant items of Personal Property (and, in the
case of tangible personal property, showing the make, model, serial number and
location thereof) other than Improvements, with a certification by Extreme that
such inventory is true and complete and that all items specified in the
inventory are covered by this Improvements Lease free and clear of any Lien
other than the Permitted Encumbrances or Liens Removable by BNPLC.

     8.   Environmental.

          (a        Environmental Covenants by Extreme. Extreme covenants that:
                    ----------------------------------

                    (i       Extreme shall not conduct or permit others to
     conduct Hazardous Substance Activities, except Permitted Hazardous
     Substance Use and Remedial Work.

                    (ii       Extreme shall not discharge or permit the
     discharge of anything on or from the Property that would require any permit
     under applicable Environmental Laws, other than (1) storm water runoff, (2)
     waste water discharges through a publicly owned treatment works, (3)
     discharges that are a necessary part of any Remedial Work, and (4) other
     similar discharges consistent with the definition herein of Permitted
     Hazardous Substance Use, in each case in strict compliance with
     Environmental Laws.

                    (iii      Following any discovery that Remedial Work is
     required by Environmental Laws or otherwise believed by BNPLC to be
     reasonably required, and to the extent not inconsistent with the other
     provisions of this Improvements Lease, Extreme shall promptly perform and
     diligently and continuously pursue such Remedial Work, in each case in
     strict compliance with Environmental Laws.

                    (iv       If requested by BNPLC in connection with any
     Remedial Work required by this subparagraph, Extreme shall retain
     independent environmental consultants acceptable to BNPLC to evaluate any
     significant new information generated during Extreme's implementation of
     the Remedial Work and to discuss with Extreme whether such new information
     indicates the need for any additional measures that Extreme should take to
     protect the health and safety of persons (including employees, contractors
     and subcontractors and their employees) or to protect the environment.
     Extreme shall implement any such additional measures to the extent required
     with respect to the Property by Environmental Laws or otherwise believed by
     BNPLC to be reasonably required and to the extent not inconsistent with the
     other provisions of this Improvements Lease.

          (b        Right of BNPLC to do Remedial Work Not Performed by Extreme.
                    -----------------------------------------------------------
If Extreme's failure to cure any breach of the covenants set forth in
subparagraph 8.(a) continues beyond the Environmental Cure Period (as defined
below), BNPLC may, in addition to any other remedies available to it, conduct
all or any part of the Remedial Work. To the extent that Remedial Work is done
by BNPLC pursuant to the preceding sentence (including any removal of Hazardous
Substances), the cost thereof shall be a demand obligation owing by Extreme to
BNPLC. As used in this subparagraph, "Environmental Cure Period" means the
period ending on the earlier of: (1) one hundred eighty days after Extreme is
notified of the breach which must be cured within such period, (2) the date that
any writ or order is issued for the levy or sale of any property owned by BNPLC
(including the Property) because of such breach, (3) the date that any criminal
action is instituted or overtly threatened against

[Improvements]
                                     -15-
<PAGE>

BNPLC or any of its directors, officers or employees because of such breach, or
(4) any Designated Sale Date upon which, for any reason, Extreme or an Affiliate
of Extreme or any Applicable Purchaser shall not purchase BNPLC's interest in
the Property pursuant to the Purchase Agreement for a net price to BNPLC (when
taken together with any Supplemental Payment made by Extreme pursuant to
Paragraph 1(A)(2) of the Purchase Agreement, in the case of a purchase by an
-----------------
Applicable Purchaser) equal to Stipulated Loss Value.

               (c   Environmental Inspections and Reviews. BNPLC reserves the
                    -------------------------------------
right to retain environmental consultants to review any environmental report
prepared by Extreme or to conduct BNPLC's own investigation to confirm whether
Extreme is complying with the requirements of this Paragraph 8. Extreme grants
to BNPLC and to BNPLC's agents, employees, consultants and contractors the right
to enter upon the Property during reasonable hours and after reasonable notice
to inspect the Property and to perform such tests as BNPLC deems necessary or
appropriate to review or investigate Hazardous Substances in, on, under or about
the Property or any discharge or suspected discharge of Hazardous Substances
into groundwater or surface water from the Property. Extreme shall promptly
reimburse BNPLC for the fees of its environmental consultants and the costs of
any such inspections and tests; provided, however, BNPLC's right to such
reimbursement shall be limited to the following circumstances: (1) a breach of
this Paragraph 8 by Extreme shall, in fact, have occurred or an Event of Default
shall have occurred and be continuing at the time BNPLC engages the consultants
or first initiates the inspections and tests; (2) BNPLC shall have engaged the
consultants or undertaken the tests and inspections to establish the condition
of the Property just prior to any conveyance of the Property pursuant to the
Option Agreement or to the expiration of this Improvements Lease; (3) BNPLC
shall have engaged the consultants or undertaken the inspections and tests to
satisfy any regulatory requirements applicable to BNPLC or its Affiliates; or
(4) BNPLC shall have engaged the consultants or undertaken the tests because
BNPLC was notified of a violation of Environmental Laws concerning the Property
by any governmental authority or owner of other land in the vicinity of the
Land.

               (d   Communications Regarding Environmental Matters.
                    ----------------------------------------------

                    (i     Extreme shall immediately advise BNPLC of (1) any
          discovery of any event or circumstance which would render any of the
          representations of Extreme herein or in the Closing Certificate
          concerning environmental matters materially inaccurate or misleading
          if made at the time of such discovery and assuming that Extreme was
          aware of all relevant facts, (2) any Remedial Work (or change in
          Remedial Work) required or undertaken by Extreme or its Affiliates in
          response to any (A) discovery of any Hazardous Substances on, under or
          about the Property other than Permitted Hazardous Substances or (B)
          any claim for damages resulting from Hazardous Substance Activities,
          (3) Extreme's discovery of any occurrence or condition on any real
          property adjoining or in the vicinity of the Property which could
          cause the Property or any part thereof to be subject to any ownership,
          occupancy, transferability or use restrictions under Environmental
          Laws, or (4) any investigation or inquiry of any failure or alleged
          failure by Extreme to comply with Environmental Laws affecting the
          Property by any governmental authority responsible for enforcing
          Environmental Laws. In such event, Extreme shall deliver to BNPLC
          within thirty days after BNPLC's request, a preliminary written
          environmental plan setting forth a general description of the action
          that Extreme proposes to take with respect thereto, if any, to bring
          the Property into compliance with Environmental Laws or to correct any
          breach by Extreme of this Paragraph 8, including any proposed Remedial
          Work, the estimated cost and time of completion, the name of the
          contractor and a copy of the construction contract, if any, and such
          additional data, instruments, documents, agreements or other materials
          or information as BNPLC may request.

                    (ii    Extreme shall provide BNPLC with copies of all
          material written communications with federal, state and local
          governments, or agencies relating to the matters listed in the
          preceding clause

[Improvements]

                                     -16-
<PAGE>

          (i). Extreme shall also provide BNPLC with copies of any
          correspondence from third Persons which threaten litigation over any
          significant failure or alleged significant failure of Extreme to
          maintain or operate the Property in accordance with Environmental
          Laws.

                    (iii   Prior to Extreme's submission of a Material
          Environmental Communication to any governmental or regulatory agency
          or third party, Extreme shall, to the extent practicable, deliver to
          BNPLC a draft of the proposed submission (together with the proposed
          date of submission), and in good faith assess and consider any
          comments of BNPLC regarding the same. Promptly after BNPLC's request,
          Extreme shall meet with BNPLC to discuss the submission, shall provide
          any additional information requested by BNPLC and shall provide a
          written explanation to BNPLC addressing the issues raised by comments
          (if any) of BNPLC regarding the submission, including a reasoned
          analysis supporting any decision by Extreme not to modify the
          submission in accordance with comments of BNPLC.

          9.   Insurance Required and Condemnation.

               (a   Liability Insurance. Throughout the Term Extreme shall
                    -------------------
maintain commercial general liability insurance against claims for bodily and
personal injury, death and property damage occurring in or upon or resulting
from any occurrence in or upon the Property under one or more insurance policies
that satisfy the requirements set forth in Exhibit B. Extreme shall deliver and
                                           ---------
maintain with BNPLC for each liability insurance policy required by this
Improvements Lease written confirmation of the policy and the scope of the
coverage provided thereby issued by the applicable insurer or its authorized
agent, which confirmation must also satisfy the requirements set forth in
Exhibit B.
---------

               (b   Property Insurance. Throughout the Term Extreme will keep
                    ------------------
all Improvements (including all alterations, additions and changes made to the
Improvements) insured against fire and other casualty under one or more property
insurance policies that satisfy the requirements set forth in Exhibit B. Extreme
                                                              ---------
shall deliver and maintain with BNPLC for each property insurance policy
required by this Improvements Lease written confirmation of the policy and the
scope of the coverage provided thereby issued by the applicable insurer or its
authorized agent, which confirmation must also satisfy the requirements set
forth in Exhibit B. If any of the Property is destroyed or damaged by fire,
         ---------
explosion, windstorm, hail or by any other casualty against which insurance
shall have been required hereunder, (i) BNPLC may, but shall not be obligated
to, make proof of loss if not made promptly by Extreme after notice from BNPLC,
(ii) each insurance company concerned is hereby authorized and directed to make
payment for such loss directly to BNPLC for application as required by Paragraph
10, and (iii) BNPLC may settle, adjust or compromise any and all claims for
loss, damage or destruction under any policy or policies of insurance (provided,
that if any such claim is for less than $500,000, if no Event of Default shall
have occurred and be continuing, Extreme shall have the right to settle, adjust
or compromise the claim as Extreme deems appropriate; and, provided further,
that so long as no Event of Default shall have occurred and be continuing, BNPLC
must provide Extreme with at least forty-five days notice of BNPLC's intention
to settle any such claim before settling it unless Extreme shall already have
approved of the settlement by BNPLC). If any casualty shall result in damage to
or loss or destruction of the Property, Extreme shall give immediate notice
thereof to BNPLC and Paragraph 10 shall apply.

               (c   Failure to Obtain Insurance. If Extreme fails to obtain any
                    ---------------------------
insurance or to provide confirmation of any such insurance as required by this
Improvements Lease, BNPLC shall be entitled (but not required) to obtain the
insurance that Extreme has failed to obtain or for which Extreme has not
provided the required confirmation and, without limiting BNPLC's other remedies
under the circumstances, BNPLC may require Extreme to reimburse BNPLC for the
cost of such insurance and to pay interest thereon computed at the Default Rate
from the date such cost was paid by BNPLC until the date of reimbursement by
Extreme.

[Improvements]

                                     -17-
<PAGE>

               (d   Condemnation. Immediately upon obtaining knowledge of the
                    ------------
institution of any proceedings for the condemnation of the Property or any
portion thereof, or any other similar governmental or quasi-governmental
proceedings arising out of injury or damage to the Property or any portion
thereof, each party shall notify the other (provided, however, BNPLC shall have
no liability for its failure to provide such notice) of the pendency of such
proceedings. Extreme shall, at its expense, diligently prosecute any such
proceedings and shall consult with BNPLC, its attorneys and experts and
cooperate with them as requested in the carrying on or defense of any such
proceedings. All proceeds of condemnation awards or proceeds of sale in lieu of
condemnation with respect to the Property and all judgments, decrees and awards
for injury or damage to the Property shall be paid to BNPLC as Escrowed
Proceeds, and all such proceeds will be applied as provided in Paragraph 10.
BNPLC is hereby authorized, in the name of Extreme, at any time when an Event of
Default shall have occurred and be continuing, or otherwise with Extreme's prior
consent, to execute and deliver valid acquittances for, and to appeal from, any
such judgment, decree or award concerning condemnation of any of the Property.
BNPLC shall not be in any event or circumstances liable or responsible for
failure to collect, or to exercise diligence in the collection of, any such
proceeds, judgments, decrees or awards.

          10.  Application of Insurance and Condemnation Proceeds.

               (a   Collection and Application of Insurance and Condemnation
                    --------------------------------------------------------
Proceeds Generally. This Paragraph 10 shall govern the application of proceeds
------------------
received by BNPLC or Extreme during the Term from any third party (1) under any
property insurance policy as a result of damage to the Property (including
proceeds payable under any insurance policy covering the Property which is
maintained by Extreme), (2) as compensation for any restriction placed upon the
use or development of the Property or for the condemnation of the Property or
any portion thereof, or (3) because of any judgment, decree or award for injury
or damage to the Property; excluding, however, any funds paid to BNPLC by
BNPLC's Parent, by an Affiliate of BNPLC or by any Participant that is made to
compensate BNPLC for any Losses BNPLC may suffer or incur in connection with
this Improvements Lease or the Property. Except as provided in subparagraph
10.(d), Extreme will promptly pay over to BNPLC any insurance, condemnation or
other proceeds covered by this Paragraph 10 which Extreme may receive from any
insurer, condemning authority or other third party. All proceeds covered by this
Paragraph 10, including those received by BNPLC from Extreme or third parties,
shall be applied as follows:

                    (i   First, proceeds covered by this Paragraph 10 will be
          used to reimburse BNPLC for any costs and expenses, including
          Attorneys' Fees, that BNPLC incurred to collect the proceeds.

                    (ii  Second, the proceeds remaining after such reimbursement
          to BNPLC (hereinafter, the "Remaining Proceeds") will be applied, as
          hereinafter more particularly provided, either as a Qualified
          Prepayment or to reimburse Extreme or BNPLC for the actual out-of-
          pocket costs of repairing or restoring the Property. Until, however,
          any Remaining Proceeds received by BNPLC are applied by BNPLC as a
          Qualified Prepayment or applied by BNPLC to reimburse costs of repairs
          to or restoration of the Property pursuant to this Paragraph 10, BNPLC
          shall hold and maintain such Remaining Proceeds as Escrowed Proceeds
          in an interest bearing account, and all interest earned on such
          account shall be added to and made a part of such Escrowed Proceeds.

               (b   Advances of Escrowed Proceeds to Extreme. Except as
                    ----------------------------------------
otherwise provided below in this Paragraph 10, BNPLC shall advance all Remaining
Proceeds held by it as Escrowed Proceeds to reimburse Extreme for the actual
out-of-pocket cost to Extreme of repairing or restoring the Property in
accordance with the requirements of this Improvements Lease and the other
Operative Documents as the applicable repair or restoration progresses and upon
compliance by Extreme with such terms, conditions and requirements as may be
reasonably

[Improvements]

                                     -18-
<PAGE>

imposed by BNPLC. In no event, however, shall BNPLC be required to pay Escrowed
Proceeds to Extreme in excess of the actual out-of-pocket cost to Extreme of the
applicable repair or restoration, as evidenced by invoices or other
documentation satisfactory to BNPLC, it being understood that BNPLC may retain
and apply any such excess as a Qualified Prepayment.

               (c   Application of Escrowed Proceeds as a Qualified Prepayment.
                    ----------------------------------------------------------
Provided that Extreme has completed any Initial Renovations which Extreme elects
to undertake and no Event of Default shall have occurred and be continuing,
BNPLC shall apply any Remaining Proceeds paid to it (or other amounts available
for application as a Qualified Prepayment) as a Qualified Prepayment on any date
that BNPLC is directed to do so by a notice from Extreme; however, if such a
notice from Extreme specifies an effective date for a Qualified Prepayment that
is less than five Business Days after BNPLC's actual receipt of the notice,
BNPLC may postpone the date of the Qualified Prepayment to any date not later
than five Business Days after BNPLC's receipt of the notice. In any event,
except when BNPLC is required by the preceding sentence to apply Remaining
Proceeds or other amounts as a Qualified Prepayment on the last day of a Base
Rent Period, BNPLC may deduct Breakage Costs incurred in connection with any
Qualified Prepayment from the Remaining Proceeds or other amounts available for
application as the Qualified Prepayment, and Extreme will reimburse BNPLC upon
request for any such Breakage Costs that BNPLC incurs but does not deduct.

               (d   Special Provisions Applicable After Completion of Initial
                    ---------------------------------------------------------
Renovations. If, after Extreme has completed any Initial Renovations which
-----------
Extreme elects to undertake, any taking by condemnation of any portion of the
Property or any casualty resulting in the diminution, destruction, demolition or
damage to any portion of the Property shall (in the good faith judgment of
BNPLC) reduce the then current "AS IS" market value by less than $500,000 and
(in the good faith estimation of BNPLC) be unlikely to result in Remaining
Proceeds of more than $500,000, and if no Event of Default shall have occurred
and be continuing, then BNPLC will, upon Extreme's request, instruct the
condemning authority or insurer, as applicable, to pay the Remaining Proceeds
resulting therefrom directly to Extreme. Extreme shall apply any such Remaining
Proceeds to the repair or restoration of the Property to a safe and secure
condition and to a value of no less than the value before taking or casualty.

               (e   Special Provisions Applicable After an Event of Default.
                    -------------------------------------------------------
Notwithstanding the foregoing, when any Event of Default shall have occurred and
be continuing, BNPLC shall be entitled to receive and collect all insurance,
condemnation or other proceeds governed by this Paragraph 10 and to apply all
Remaining Proceeds, when and to the extent deemed appropriate by BNPLC in its
sole discretion, either (A) to the reimbursement of Extreme or BNPLC for the
out-of-pocket cost of repairing or restoring the Property, or (B) as Qualified
Prepayments.

               (f   Extreme's Obligation to Restore. Regardless of the adequacy
                    -------------------------------
of any Remaining Proceeds available to Extreme hereunder, and notwithstanding
other provisions of this Improvements Lease to the contrary, if the Property is
damaged by fire or other casualty or less than all or substantially all of the
Property is taken by condemnation, Extreme must:

               (i   promptly restore or improve the Property or the remainder
         thereof to a value no less than Stipulated Loss Value and to a
         reasonably safe and sightly condition; or

               (ii  promptly restore the Property to a reasonably safe and
         sightly condition and pay to BNPLC for application as a Qualified
         Prepayment the amount (if any), as determined by BNPLC, needed to
         reduce Stipulated Loss Value to no more than the then current "AS IS"
         market value of the Property or remainder thereof.

[Improvements]

                                     -19-
<PAGE>

               (g   Takings of All or Substantially All of the Property. In the
                    ---------------------------------------------------
event of any taking of all or substantially all of the Property, BNPLC shall be
entitled to apply all Remaining Proceeds as a Qualified Prepayment. In addition,
if Stipulated Loss Value immediately prior to any such taking exceeds the sum of
the Remaining Proceeds resulting from such a condemnation, then BNPLC shall be
entitled to recover the excess from Extreme upon demand as an additional
Qualified Prepayment, whereupon this Improvements Lease shall terminate. Any
taking of so much of the Real Property as, in BNPLC's reasonable good faith
judgment, makes it impracticable to restore or improve the remainder thereof as
required by part (ii) of the preceding subparagraph shall be considered a taking
of substantially all the Property for purposes of this Paragraph 10.

          11.  Additional Representations, Warranties and Covenants of Extreme
Concerning the Property. Extreme represents, warrants and covenants as follows:

               (a   Compliance with Covenants and Laws. The use of the Property
                    ----------------------------------
permitted by this Improvements Lease complies, or will comply after Extreme
obtains available permits as the tenant under this Improvements Lease, in all
material respects with all Applicable Laws. Extreme has obtained or will
promptly obtain all utility, building, health and operating permits as may be
required by any governmental authority or municipality having jurisdiction over
the Property for the construction contemplated herein and the use of the
Property permitted by this Improvements Lease.

               (b   Operation of the Property. During the Term, Extreme shall
                    -------------------------
operate the Property in a good and workmanlike manner and substantially in
compliance with all Applicable Laws and will pay or cause to be paid all fees or
charges of any kind in connection therewith. (If Extreme does not promptly
correct any failure of the Property to comply with Applicable Laws that is the
subject of a written notice given to Extreme or BNPLC by any governmental
authority, then for purposes of the preceding sentence, Extreme shall be
considered not to have maintained the Property "substantially in accordance with
Applicable Laws" whether or not the noncompliance would be substantial in the
absence of the notice.) During the Term, Extreme shall not use or occupy, or
allow the use or occupancy of, the Property in any manner which violates any
Applicable Law or which constitutes a public or private nuisance or which makes
void, voidable or cancelable any insurance then in force with respect thereto.
During the Term, to the extent that any of the following would, individually or
in the aggregate, materially and adversely affect the value of the Property or
the use of the Property for purposes permitted by this Improvements Lease,
Extreme shall not, without BNPLC's prior consent: (i) initiate or permit any
zoning reclassification of the Property; (ii) seek any variance under existing
zoning ordinances applicable to the Property; (iii) use or permit the use of the
Property in a manner that would result in such use becoming a nonconforming use
under applicable zoning ordinances or similar laws, rules or regulations; (iv)
execute or file any subdivision plat affecting the Property; or (v) consent to
the annexation of the Property to any municipality. If during the Term (A) a
change in the zoning or other Applicable Laws affecting the permitted use or
development of the Property shall occur that (in BNPLC's good faith judgment)
reduces the value of the Property, or (B) conditions or circumstances on or
about the Property are discovered (such as the presence of an endangered
species) which substantially impede development and thereby (in BNPLC's good
faith judgment) reduce the value of the Property, then Extreme shall upon demand
pay BNPLC an amount equal to such reduction (as determined by BNPLC in good
faith) for application as a Qualified Prepayment. Extreme shall not permit any
drilling or exploration for, or extraction, removal or production of, minerals
from the surface or subsurface of the Property, and Extreme shall not do
anything that could reasonably be expected to significantly reduce the market
value of the Property. If Extreme receives a notice or claim from any federal,
state or other governmental authority that the Property is not in compliance
with any Applicable Law, or that any action may be taken against BNPLC because
the Property does not comply with any Applicable Law, Extreme shall promptly
furnish a copy of such notice or claim to BNPLC.

[Improvements]

                                     -20-
<PAGE>

          Notwithstanding the foregoing, Extreme may in good faith, by
appropriate proceedings, contest the validity and applicability of any
Applicable Law with respect to the Property, and pending such contest Extreme
shall not be deemed in default hereunder because of the violation of such
Applicable Law, if Extreme diligently prosecutes such contest to completion in a
manner reasonably satisfactory to BNPLC, and if Extreme promptly causes the
Property to comply with any such Applicable Law upon a final determination by a
court of competent jurisdiction that the same is valid and applicable to the
Property; provided, however, in any event such contest shall be concluded and
the violation of such Applicable Law must be corrected by Extreme and any claims
asserted against BNPLC or the Property because of such violation must be paid by
Extreme, all prior to the earlier of (i) the date that any criminal prosecution
is instituted or overtly threatened against BNPLC or any of its directors,
officers or employees because of such violation, (ii) the date that any action
is taken by any governmental authority against BNPLC or any property owned by
BNPLC (including the Property) because of such violation, or (iii) a Designated
Sale Date upon which, for any reason, Extreme or an Affiliate of Extreme or any
Applicable Purchaser shall not purchase BNPLC's interest in the Property
pursuant to the Purchase Agreement for a price to BNPLC (when taken together
with any additional payments made by Extreme pursuant to Paragraph 1(A)(2) of
                                                         -----------------
the Purchase Agreement, in the case of a purchase by an Applicable Purchaser)
equal to the Break Even Price.

               (c   Debts for Construction, Maintenance, Operation or
                    -------------------------------------------------
Development. Extreme shall cause all debts and liabilities incurred in the
-----------
construction, maintenance, operation or development of the Property, including
all debts and liabilities for labor, material and equipment and all debts and
charges for utilities servicing the Property, to be promptly paid; provided,
that nothing in this subparagraph will be construed to require Extreme to remove
Liens Removable by BNPLC.

          Notwithstanding the foregoing, Extreme may in good faith, by
appropriate proceedings, contest the validity, applicability or amount of any
asserted mechanic's or materialmen's lien and pending such contest Extreme shall
not be deemed in default under this subparagraph because of the contested lien
if (1) within sixty days after being asked to do so by BNPLC, Extreme bonds over
to BNPLC's reasonable satisfaction all such contested liens against the Property
alleged to secure an amount in excess of $500,000 (individually or in the
aggregate), (2) Extreme diligently prosecutes such contest to completion in a
manner reasonably satisfactory to BNPLC, and (3) Extreme promptly causes to be
paid any amount adjudged by a court of competent jurisdiction to be due, with
all costs and interest thereon, promptly after such judgment becomes final;
provided, however, that in any event each such contest shall be concluded and
the lien, interest and costs must be paid by Extreme prior to the earlier of (i)
the date that any criminal prosecution is instituted or overtly threatened
against BNPLC or its directors, officers or employees because of the nonpayment
thereof, (ii) the date that any writ or order is issued under which the Property
or any other property in which BNPLC has an interest may be seized or sold or
any other action is taken against BNPLC or any property in which BNPLC has an
interest because of the nonpayment thereof, or (iii) a Designated Sale Date upon
which, for any reason, Extreme or an Affiliate of Extreme or any Applicable
Purchaser shall not purchase BNPLC's interest in the Property pursuant to the
Purchase Agreement for a price to BNPLC (when taken together with any additional
payments made by Extreme pursuant to Paragraph 1(A)(2) of the Purchase
                                     -----------------
Agreement, in the case of a purchase by an Applicable Purchaser) equal to the
Break Even Price.

               (d   Repair, Maintenance, Alterations and Additions. Extreme
                    ----------------------------------------------
shall keep the Property in good order, operating condition and appearance and
shall cause all necessary repairs, renewals and replacements to be promptly
made. Extreme will not allow any of the Property to be materially misused,
abused or wasted, and Extreme shall promptly replace any worn-out fixtures and
Personal Property with fixtures and Personal Property comparable to the replaced
items when new. Except as required in connection with Initial Renovations made
in accordance with Paragraph 6, Extreme shall not, without the prior consent of
BNPLC, (i) remove from the Property any fixture or Personal Property having
significant value except such as are replaced by Extreme by fixtures or Personal
Property of equal suitability and value, free and clear of any lien or security
interest (and for purposes of

[Improvements]

                                     -21-
<PAGE>

this clause "significant value" will mean any fixture or Personal Property that
has a value of more than $100,000 or that, when considered together with all
other fixtures and Personal Property removed and not replaced by Extreme by
items of equal suitability and value, has an aggregate value of $500,000 or
more) or (ii) make material new Improvements or alter Improvements in any
material respect. Without limiting the foregoing, Extreme will notify BNPLC
before making any significant alterations to the Improvements after the
completion of any Initial Renovations which Extreme elects to undertake.

               (e   Permitted Encumbrances and Development Documents. Extreme
                    ------------------------------------------------
shall during the Term comply with and will cause to be performed all of the
covenants, agreements and obligations imposed upon the owner of any interest in
the Property by the Permitted Encumbrances (including the Premises Leases) or
the Development Documents. Without limiting the foregoing, Extreme shall cause
all amounts to be paid when due, the payment of which is secured by any Lien
against the Property created by the Permitted Encumbrances. Without the prior
consent of BNPLC, Extreme shall not enter into, initiate, approve or consent to
any modification of any Permitted Encumbrance or Development Document that would
create or expand or purport to create or expand obligations or restrictions
which would encumber BNPLC's interest in the Property. (Whether BNPLC must give
any such consent requested by Extreme during the Term of this Improvements Lease
shall be governed by subparagraph 3(A) of the Closing Certificate and
                     -----------------
Agreement.)

               (f   Books and Records Concerning the Property. Extreme shall
                    -----------------------------------------
keep books and records that are accurate and complete in all material respects
for the Property and, subject to Paragraph 15.(c), will permit all such books
and records (including all contracts, statements, invoices, bills and claims for
labor, materials and services supplied for the construction and operation of any
Improvements) to be inspected and copied by BNPLC. This subparagraph shall not
be construed as requiring Extreme to regularly maintain separate books and
records relating exclusively to the Property; provided, however, that upon
request, Extreme shall construct or abstract from its regularly maintained books
and records information required by this subparagraph relating to the Property.

          12.  Financial Covenants, Reporting Covenants and Other Covenants
Incorporated by Reference to Schedule 1. Throughout the Term of this
                             ----------
Improvements Lease, Extreme shall comply with the requirements of Schedule 1
                                                                  ----------
attached hereto.


          13.  Assignment and Subletting by Extreme.

               (a   BNPLC's Consent Required. Without the prior consent of
                    ------------------------
BNPLC, Extreme shall not assign, transfer, mortgage, pledge or hypothecate this
Improvements Lease or any interest of Extreme hereunder and shall not sublet all
or any part of the Property, by operation of law or otherwise; provided, that
subject to subparagraph 13.(c) below, (I) this provision shall not be construed
to prohibit any Premises Lease described in the Common Definitions and
Provisions Agreement (Improvements) or any transfer or sublease by a lessee
thereunder which is authorized by any Premises Lease, and (II) if (and after)
Extreme completes Initial Renovations, and so long as no Event of Default has
occurred and is continuing: (1) Extreme shall be entitled to sublet no more than
49% (computed on the basis of square footage) of the useable space in then
existing and completed building Improvements, if any, so long as (i) any
sublease by Extreme is made expressly subject and subordinate to the terms
hereof, and (ii) such sublease has a term equal to or less than the remainder of
the then effective Term of this Improvements Lease; and (2) Extreme shall be
entitled to assign or transfer this Improvements Lease or any interest of
Extreme hereunder to an Affiliate of Extreme if both Extreme and its Affiliate
confirm their joint and several liability hereunder by written notice given to
BNPLC.

               (b   Standard for BNPLC's Consent to Assignments and Certain
                    -------------------------------------------------------
Other Matters. Consents and approvals of BNPLC which are required by this
-------------
Paragraph 13 will not be unreasonably withheld or delayed, but

[Improvements]

                                     -21-
<PAGE>

Extreme acknowledges that BNPLC's withholding of such consent or approval shall
be reasonable if BNPLC determines in good faith that (1) giving the approval may
materially increase BNPLC's risk of liability for any existing or future
environmental problem, or (2) giving the approval is likely to increase BNPLC's
administrative burden of complying with or monitoring Extreme's compliance with
the requirements of this Improvements Lease.

               (c   Consent Not a Waiver. No consent by BNPLC to a sale,
                    --------------------
assignment, transfer, mortgage, pledge or hypothecation of this Improvements
Lease or Extreme's interest hereunder, and no assignment or subletting of the
Property or any part thereof in accordance with this Improvements Lease or
otherwise with BNPLC's consent, shall release Extreme from liability hereunder;
and any such consent shall apply only to the specific transaction thereby
authorized and shall not relieve Extreme from any requirement of obtaining the
prior consent of BNPLC to any further sale, assignment, transfer, mortgage,
pledge or hypothecation of this Improvements Lease or any interest of Extreme
hereunder.

          14.  Assignment by BNPLC.

               (a   Restrictions on Transfers. Except by a Permitted Transfer,
                    -------------------------
BNPLC shall not assign, transfer, mortgage, pledge, encumber or hypothecate this
Improvements Lease or the other Operative Documents or any interest of BNPLC in
and to the Property during the Term without the prior consent of Extreme, which
consent Extreme may withhold in its sole discretion. Further, notwithstanding
anything to the contrary herein contained, if withholding taxes are imposed on
the rents and other amounts payable to BNPLC hereunder because of BNPLC's
assignment of this Improvements Lease to any citizen of, or any corporation or
other entity formed under the laws of, a country other than the United States,
Extreme shall not be required to compensate BNPLC or any such assignee for the
withholding tax. If, in breach of this subparagraph, BNPLC transfers the
Property or any part thereof by a conveyance or that does not constitute a
Permitted Transfer, with the result that additional transfer taxes or other
Impositions are assessed against the Property or the owner thereof, BNPLC shall
be required to pay such additional transfer taxes or other Impositions.

               (b   Effect of Permitted Transfer or other Assignment by BNPLC.
                    ---------------------------------------------------------
If, without breaching subparagraph 14.(a), BNPLC sells or otherwise transfers
the Property and assigns to the transferee all of BNPLC's rights under this
Improvements Lease and under the other Operative Documents, and if the
transferee expressly assumes all of BNPLC's obligations under this Improvements
Lease and under the other Operative Documents, then BNPLC shall thereby be
released from any obligations arising after such assumption under this
Improvements Lease or under the other Operative Documents, and Extreme shall
look solely to each successor in interest of BNPLC for performance of such
obligations. (As used in this subparagraph, "Operative Documents" is intended to
mean not only the Operative Documents as defined in the Common Definitions and
Provisions Agreement (Improvements), but also the Operative Documents as defined
in the Other Common Definitions and Provisions Agreement.)

          15.  BNPLC's Right of Access.

               (a   During the Term, BNPLC and BNPLC's representatives may
(subject to subparagraphs 15.(c) and 15.(d)) enter the Property at any
reasonable time after five Business Days advance written notice to Extreme for
the purpose of making inspections or performing any work BNPLC is authorized to
undertake by the next subparagraph or for the purpose confirming whether Extreme
has complied with the requirements of this Improvements Lease or the other
Operative Documents.

               (b   If Extreme fails to perform any act or to take any action
required of it by this Improvements Lease or the Closing Certificate, or to pay
any money which Extreme is required by this

[Improvements]

                                     -23-
<PAGE>

Improvements Lease or the Closing Certificate to pay, and if such failure or
action constitutes an Event of Default or renders BNPLC or any director,
officer, employee or Affiliate of BNPLC at risk of criminal prosecution or
renders BNPLC's interest in the Property or any part thereof at risk of
forfeiture by forced sale or otherwise, then in addition to any other remedies
specified herein or otherwise available, BNPLC may, perform or cause to be
performed such act or take such action or pay such money. Any expenses so
incurred by BNPLC, and any money so paid by BNPLC, shall be a demand obligation
owing by Extreme to BNPLC. Further, BNPLC, upon making such payment, shall be
subrogated to all of the rights of the person, corporation or body politic
receiving such payment. But nothing herein shall imply any duty upon the part of
BNPLC to do any work which under any provision of this Improvements Lease
Extreme may be required to perform, and the performance thereof by BNPLC shall
not constitute a waiver of Extreme's default. BNPLC may during the progress of
any such work permitted by BNPLC hereunder on or in the Property keep and store
upon the Property all necessary materials, tools, and equipment. BNPLC shall not
in any event be liable for inconvenience, annoyance, disturbance, loss of
business, or other damage to Extreme or the subtenants or invitees of Extreme by
reason of making such repairs or the performance of any such work on or in the
Property, or on account of bringing materials, supplies and equipment into or
through the Property during the course of such work (except for any liability in
excess of the liability insurance limits established in Exhibit B resulting from
                                                        ---------
death or injury or damage to the property of third parties caused by the
Established Misconduct of BNPLC or its officers, employees, or agents in
connection therewith), and the obligations of Extreme under this Improvements
Lease shall not thereby be excused in any manner.

          (c   Extreme shall have no obligation to provide proprietary
information (as defined in the next sentence) to BNPLC, except and to the extent
that (1) BNPLC reasonably determines that BNPLC cannot accomplish the purposes
of BNPLC's inspection of the Property or exercise of other rights granted
pursuant to the various express provisions of this Improvements Lease and the
other Operative Documents without evaluating such information. For purposes of
this Improvements Lease "proprietary information" includes Extreme's
intellectual property, trade secrets and other confidential information of value
to Extreme about, among other things, Extreme's manufacturing processes,
products, marketing and corporate strategies, but in no event will "proprietary
information" include any disclosure of substances and materials (and their
chemical composition) which are or previously have been present in, on or under
the Property at the time of any inspections by BNPLC, nor will "proprietary
information" include any additional disclosures reasonably required to permit
BNPLC to determine whether the presence of such substances and materials has
constituted a violation of Environmental Laws. In addition, under no
circumstances shall Extreme have any obligation to disclose to BNPLC or any
other party any proprietary information of Extreme (including, without
limitation, any pending applications for patents or trademarks, any research and
design and any trade secrets) except if and to the limited extent reasonably
necessary to comply with the express provisions of this Improvements Lease or
the other Operative Documents.

          (d   So long as Extreme remains in possession of the Property, BNPLC
or BNPLC's representative will, before making any inspection or performing any
work on the Property authorized by this Improvements Lease, if then requested to
do so by Extreme to maintain Extreme's security: (i) sign in at Extreme's
security or information desk if Extreme has such a desk on the premises, (ii)
wear a visitor's badge or other reasonable identification, (iii) permit an
employee of Extreme to observe such inspection or work, and (iv) comply with
other similar reasonable nondiscriminatory security requirements of Extreme that
do not, individually or in the aggregate, significantly interfere with
inspections or work of BNPLC authorized by this Improvements Lease.

     16.  Events of Default. Each of the following events shall be an "Event of
Default" by Extreme under this Improvements Lease:


[Improvements]

                                     -24-


<PAGE>

          (a   Extreme shall fail to pay when due any installment of Rent due
hereunder and such failure shall continue for three (3) Business Days after
Extreme is notified in writing thereof.

          (b   Extreme shall fail to cause any representation or warranty of
Extreme contained herein or in the Closing Certificate that was false or
misleading in any material respect when made to be made true and not misleading
(other than as described in the other clauses of this Paragraph 16), or Extreme
shall fail to comply with any term, provision or covenant of this Improvements
Lease or of the Closing Certificate (other than as described in the other
clauses of this Paragraph 16), and in either case shall not cure such failure
prior to the earlier of (A) thirty days after written notice thereof is sent to
Extreme or (B) the date any writ or order is issued for the levy or sale of any
property owned by BNPLC (including the Property) or any criminal prosecution is
instituted or overtly threatened against BNPLC or any of its directors, officers
or employees because of such failure; provided, however, that so long as no such
writ or order is issued and no such criminal prosecution is instituted or
overtly threatened, the period within which such failure may be cured by Extreme
shall be extended for a further period (not to exceed an additional sixty days)
as shall be necessary for the curing thereof with diligence, if (but only if)
(x) such failure is susceptible of cure but cannot with reasonable diligence be
cured within such thirty day period, (y) Extreme shall promptly have commenced
to cure such failure and shall thereafter continuously prosecute the curing
thereof with reasonable diligence and (z) the extension of the period for cure
will not, in any event, cause the period for cure to extend beyond five days
prior to the expiration of this Improvements Lease.

          (c   Extreme shall abandon the Property.

          (d   Extreme or any Subsidiary shall fail to make any payment or
payments of principal, premium or interest, of Debt of Extreme described in the
next sentence when due (taking into consideration the time Extreme may have to
cure such failure, if any, under the documents governing such Debt). As used in
this clause 14(a)(v), "Debt" shall include only Debt (as defined in the Common
Definitions and Provisions Agreement (Improvements)) of Extreme or any of its
Subsidiaries now existing or arising in the future (1) payable to any Interested
Party, or (2) payable to any other Person and with respect to which $5,000,000
or more is actually due and payable because of acceleration or otherwise.

          (e   Extreme: (a) shall generally not, or be unable to, or shall admit
in writing its inability to, pay its debts as such debts become due; or (b)
shall make an assignment for the benefit of creditors, petition or apply to any
tribunal for the appointment of a custodian, receiver or trustee for it or a
substantial part of its assets; or (c) shall file any petition or application to
commence any proceeding under any bankruptcy, reorganization, arrangement,
readjustment of debt, dissolution or liquidation law or statute of any
jurisdiction, whether now or hereafter in effect; or (d) shall have had any such
petition or application filed against it; or (e) by any act or omission shall
indicate its consent to, approval of or acquiescence in any such petition,
application or proceeding or order for relief or the appointment of a custodian,
receiver or trustee for all or any substantial part of its property; or (f)
shall suffer any such custodianship, receivership or trusteeship to continue
undischarged for a period of sixty days or more.

          (f   One or more final judgments, decrees or orders for the payment of
money in excess of $5,000,000 in the aggregate shall be rendered against Extreme
and such judgments, decrees or orders shall continue unsatisfied and in effect
for a period of thirty consecutive days without Extreme's having obtained an
agreement (or after the expiration or termination of an agreement) of the
Persons entitled to enforce such judgment, decrees or orders not to enforce the
same pending negotiations with Extreme concerning the satisfaction or other
discharge of the same. (For purposes of this provision, no judgment, decree or
order will be considered "final" until Extreme's right to appeal, if any, shall
have expired or been exhausted.)


[Improvements]

                                     -25-
<PAGE>

          (g   Extreme shall breach the requirements of Paragraph 12, which by
reference to Schedule 1 establishes certain financial covenants and other
             ----------
requirements.

          (h   as of the effective date of this Improvements Lease, any of the
representations or warranties of Extreme contained in subparagraphs 2(A) - (K)
of the Closing Certificate shall be false or misleading in any material respect.

          (i   Extreme shall fail to pay the full amount of any Supplemental
Payment required by the Purchase Agreement on the Designated Sale Date.

          (j   Extreme shall fail to comply with any term, provision or
condition of the Pledge Agreement after the expiration of any applicable notice
and cure period set forth in the Pledge Agreement.

          17.  Remedies.

               (a   Basic Remedies. At any time after an Event of Default and
                    --------------
after BNPLC has given any notice required by subparagraph 17.(b), BNPLC shall be
entitled at BNPLC's option (and without limiting BNPLC in the exercise of any
other right or remedy BNPLC may have, and without any further demand or notice
except as expressly described in this subparagraph 17.(a)), to exercise any one
or more of the following remedies:

                    (i     By notice to Extreme, BNPLC may terminate Extreme's
          right to possession of the Property. A notice given in connection with
          unlawful detainer proceedings specifying a time within which to cure a
          default shall terminate Extreme's right to possession if Extreme fails
          to cure the default within the time specified in the notice.

                    (ii    Upon termination of Extreme's right to possession and
          without further demand or notice, BNPLC may re-enter the Property in
          any manner not prohibited by Applicable Law and take possession of all
          improvements, additions, alterations, equipment and fixtures thereon
          and remove any persons in possession thereof. Any property in the
          Improvements may be removed and stored in a warehouse or elsewhere at
          the expense and risk of and for the account of Extreme.

                    (iii)  Upon termination of Extreme's right to possession,
          this Improvements Lease shall terminate and BNPLC may recover from
          Extreme:

                              a)   The worth at the time of award of the unpaid
               Rent which had been earned at the time of termination;

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

                              c)   The worth at the time of award of the amount
               by which the unpaid Rent for the balance of the scheduled Term
               after the time of award exceeds the amount of such rental loss
               that Extreme proves could be reasonably avoided; and

                              d)   Any other amount necessary to compensate
               BNPLC for all the detriment proximately caused by Extreme's
               failure to perform Extreme's obligations under this Improvements
               Lease or which in the ordinary course of things would be likely
               to result therefrom, including the


[Improvements]

                                     -26-
<PAGE>

               costs and expenses (including Attorneys' Fees, advertising costs
               and brokers' commissions) of recovering possession of the
               Property, removing persons or property therefrom, placing the
               Property in good order, condition, and repair, preparing and
               altering the Property for reletting, all other costs and expenses
               of reletting, and any loss incurred by BNPLC as a result of
               Extreme's failure to perform Extreme's obligations under the
               other Operative Documents.

               The "worth at the time of award" of the amounts referred to in
               subparagraph 17.(a)(iii)a) and subparagraph 17.(a)(iii)b) shall
               be computed by allowing interest at the Default Rate. The "worth
               at the time of award" of the amount referred to in subparagraph
               17.(a)(iii)c) 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 one percent (1%).

                         e)   Such other amounts in addition to or in lieu of
               the foregoing as may be permitted from time to time by applicable
               California law.

                    (iv) BNPLC shall have the remedy described in California
          Civil Code Section 1951.4 (lessor may continue lease in force even
          after lessee's breach and abandonment and recover rent as it becomes
          due, if lessee has right to sublet or assign, subject only to
          reasonable limitations). Accordingly, even if Extreme has breached
          this Improvements Lease and abandoned the Property, this Improvements
          Lease shall continue in effect for so long as BNPLC does not terminate
          Extreme's right to possession, and BNPLC may enforce all of BNPLC's
          rights and remedies under this Improvements Lease, including the right
          to recover the Rent as it becomes due under this Improvements Lease.
          Extreme's right to possession shall not be deemed to have been
          terminated by BNPLC except pursuant to subparagraph 17.(a)(i) hereof.
          The following shall not constitute a termination of Extreme's right to
          possession:

                         a)   Acts of maintenance or preservation or efforts to
               relet the Property;

                         b)   The appointment of a receiver upon the initiative
               of BNPLC to protect BNPLC's interest under this Improvements
               Lease; or

                         c)   Reasonable withholding of consent to an assignment
               or subletting, or terminating a subletting or assignment by
               Extreme.

               (b)  Notice Required So Long As the Purchase Option and Extreme's
                    ------------------------------------------------------------
Initial Remarketing Rights and Obligations Continue Under the Purchase
----------------------------------------------------------------------
Agreement. So long as Extreme remains in possession of the Property and there
---------
has been no termination of the Purchase Option and Extreme's Initial Remarketing
Rights and Obligations as provided Paragraph 4 of the Purchase Agreement,
                                   -----------
BNPLC's right to exercise remedies provided in subparagraph 17.(a) will be
subject to the condition precedent that BNPLC shall have notified Extreme, at a
time when an Event of Default shall have occurred and be continuing, of BNPLC's
intent to exercise remedies provided in subparagraph 17.(a) at least sixty days
prior to exercising the remedies. The condition precedent is intended to provide
Extreme with an opportunity to exercise the Purchase Option or Extreme's Initial
Remarketing Rights and Obligations before losing possession of the Property
pursuant to subparagraph 17.(a). The condition precedent is not, however,
intended to extend any period for curing an Event of Default. Accordingly, if an
Event of Default has occurred, and regardless of whether any Event of Default is
then continuing, BNPLC may proceed immediately to exercise remedies provided in
subparagraph 17.(a) at any time after the earlier of (i) sixty days after BNPLC
has given such a notice to Extreme, (ii) any date upon which Extreme
relinquishes possession of the Property, or (iii) any termination of the
Purchase Option and Extreme's Initial Remarketing Rights and Obligations.


[Improvements]

                                     -27-
<PAGE>

          (c)  Enforceability. This Paragraph 17 shall be enforceable to the
               --------------
maximum extent not prohibited by Applicable Law, and the unenforceability of any
provision in this Paragraph shall not render any other provision unenforceable.

          (d)  Remedies Cumulative. No right or remedy herein conferred upon or
               -------------------
reserved to BNPLC is intended to be exclusive of any other right or remedy, and
each and every such right and remedy shall be cumulative and in addition to any
other right or remedy given to BNPLC hereunder or now or hereafter existing in
favor of BNPLC under Applicable Law or in equity. In addition to other remedies
provided in this Improvements Lease, BNPLC shall be entitled, to the extent
permitted by Applicable Law or in equity, to injunctive relief in case of the
violation, or attempted or threatened violation, of any of the covenants,
agreements, conditions or provisions of this Improvements Lease, or to a decree
compelling performance of any of the other covenants, agreements, conditions or
provisions of this Improvements Lease to be performed by Extreme, or to any
other remedy allowed to BNPLC at law or in equity. Nothing contained in this
Improvements Lease shall limit or prejudice the right of BNPLC to prove for and
obtain in proceedings for bankruptcy or insolvency of Extreme by reason of the
termination of this Improvements Lease, an amount equal to the maximum allowed
by any statute or rule of law in effect at the time when, and governing the
proceedings in which, the damages are to be proved, whether or not the amount be
greater, equal to, or less than the amount of the loss or damages referred to
above. Without limiting the generality of the foregoing, nothing contained
herein shall modify, limit or impair any of the rights and remedies of BNPLC
under the Purchase Documents, and BNPLC shall not be required to give the sixty
day notice described in subparagraph 17.(b) as a condition precedent to any
acceleration of the Designated Sale Date or to taking any action to enforce the
Purchase Documents.

     18.  Default by BNPLC. If BNPLC should default in the performance of any of
its obligations under this Improvements Lease, BNPLC shall have the time
reasonably required, but in no event less than thirty days, to cure such default
after receipt of notice from Extreme specifying such default and specifying what
action Extreme believes is necessary to cure the default. If Extreme prevails in
any litigation brought against BNPLC because of BNPLC's failure to cure a
default within the time required by the preceding sentence, then Extreme shall
be entitled to an award against BNPLC for the monetary damages proximately
caused to Extreme by such default.

     Notwithstanding the foregoing, BNPLC's right to cure as provided in this
Paragraph 18 will not in any event extend the time within which BNPLC must
remove Liens Removable by BNPLC as required by Paragraph 19 beyond the
Designated Sale Date.

     19.  Quiet Enjoyment. Provided Extreme pays the Base Rent and all
Additional Rent payable hereunder as and when due and payable and keeps and
fulfills all of the terms, covenants, agreements and conditions to be performed
by Extreme hereunder, BNPLC shall not during the Term disturb Extreme's
peaceable and quiet enjoyment of the Property; however, such enjoyment shall be
subject to the terms, provisions, covenants, agreements and conditions of this
Improvements Lease, to Permitted Encumbrances, to Development Documents and to
any other claims not constituting Liens Removable by BNPLC. If any Lien
Removable by BNPLC is claimed against the Property, BNPLC will remove the Lien
Removable by BNPLC promptly. Any breach by BNPLC of this Paragraph shall render
BNPLC liable to Extreme for any monetary damages proximately caused thereby, but
as more specifically provided in subparagraph 4.(b) above, no such breach shall
entitle Extreme to terminate this Improvements Lease or excuse Extreme from its
obligation to pay Rent.

     20.  Surrender Upon Termination. Unless Extreme or an Applicable Purchaser
purchases or has purchased BNPLC's entire interest in the Property pursuant to
the terms of the Purchase Agreement and BNPLC's entire interest in the
Improvements and other "Property" under (and as defined in) the Other Purchase
Agreement,


[Improvements]

                                     -28-
<PAGE>

Extreme shall, upon the termination of Extreme's right to occupancy, surrender
to BNPLC the Property, including Improvements constructed by Extreme and
fixtures and furnishings included in the Property, free of all Hazardous
Substances (including Permitted Hazardous Substances) and tenancies and with all
Improvements in substantially the same condition as of the date the same were
initially completed, excepting only (i) ordinary wear and tear that occurs
between the maintenance, repairs and replacements required by other provisions
of this Improvements Lease or the Other Lease Agreement, and (ii) demolition,
alterations and additions which are expressly permitted by the terms of this
Improvements Lease or the Other Lease Agreement and which have been completed by
Extreme in a good and workmanlike manner in accordance with all Applicable Laws.
Any movable furniture or movable personal property belonging to Extreme or any
party claiming under Extreme, if not removed at the time of such termination and
if BNPLC shall so elect, shall be deemed abandoned and become the property of
BNPLC without any payment or offset therefor. If BNPLC shall not so elect, BNPLC
may remove such property from the Property and store it at Extreme's risk and
expense.

     Nothing in this Paragraph 20 will be construed to require Extreme to
surrender the Property to BNPLC during the continuation of any breach by BNPLC
of any obligation it has under the Purchase Agreement to convey the Property to
Extreme or an Applicable Purchaser.

     21.  Holding Over by Extreme. Should Extreme not purchase BNPLC's right,
title and interest in the Property as provided in the Purchase Agreement, but
nonetheless continue to hold the Property after the termination of this
Improvements Lease without BNPLC's consent, whether such termination occurs by
lapse of time or otherwise, such holding over shall constitute and be construed
as a tenancy from day to day only, at a daily Base Rent equal to: (i) Stipulated
Loss Value on the day in question, times (ii) the Default Rate for such day;
divided by (iii) three hundred and sixty; subject, however, to all of the terms,
provisions, covenants and agreements on the part of Extreme hereunder. No
payments of money by Extreme to BNPLC after the termination of this Improvements
Lease shall reinstate, continue or extend the Term of this Improvements Lease
and no extension of this Improvements Lease after the termination thereof shall
be valid unless and until the same shall be reduced to writing and signed by
both BNPLC and Extreme.

     22.  Independent Obligations Evidenced by the Other Operative Documents.
Extreme acknowledges and agrees that nothing contained in this Improvements
Lease shall limit, modify or otherwise affect any of Extreme's obligations under
the other Operative Documents, which obligations are intended to be separate,
independent and in addition to, and not in lieu of, the obligations set forth
herein. In the event of any inconsistency between the express terms and
provisions of the Purchase Documents and the express terms and provisions of
this Improvements Lease, the express terms and provisions of the Purchase
Documents shall control. In the event of any inconsistency between the express
terms and provisions of the Closing Certificate and the express terms and
provisions of this Improvements Lease, the express terms and provisions of this
Improvements Lease shall control; provided, nothing herein will limit or impair
Extreme's obligations under the Closing Certificate following any expiration of
termination of this Improvements Lease.


                         [The signature pages follow.]



[Improvements]

                                     -29-
<PAGE>

     IN WITNESS WHEREOF, Extreme and BNPLC have caused this Lease Agreement
(Improvements) to be executed as of June 1, 2000.


                                        "Extreme"

                                        EXTREME NETWORKS, INC.


                                        By: _________________________________
                                            Name:____________________________
                                            Title:___________________________
<PAGE>

[Continuation of signature pages to Lease Agreement (Improvements) dated to be
effective June 1, 2000]



                                        "BNPLC"

                                        BNP LEASING CORPORATION


                                        By: _________________________________
                                            Lloyd G. Cox, Vice President
<PAGE>

                                   Exhibit A
                                   ---------

                               Legal Description

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.
<PAGE>

                                   Exhibit B
                                   ---------

                            Insurance Requirements


I.   LIABILITY INSURANCE:

     A.   Extreme must maintain commercial general liability ("CGL") insurance
on an occurrence basis, affording immediate protection to the limit of not less
than $20,000,000 combined single limit for bodily and personal injury, death and
property damage in respect of any one occurrence. The CGL insurance must be
primary to, and shall receive no contribution from, any insurance policies or
self-insurance programs otherwise afforded to or available to the Interested
Parties, collectively or individually. Further, the CGL insurance must include
blanket contractual liability coverage which insures contractual liability under
the indemnifications set forth in this Improvements Lease (though such coverage
or the amount thereof shall in no way limit such indemnifications).

     B.   Any deductible or self-insured retention applicable to the CGL
insurance shall not exceed $500,000.

     C.   The forms of insurance policies (including endorsements) used to
provide the CGL insurance required by this Improvements Lease, and the insurance
company or companies providing the CGL insurance, must be acceptable to BNPLC.
BNPLC shall have the right from time to time and at any time to review and
approve such policy forms (including endorsements) and the insurance company or
companies providing the insurance. Without limiting the generality of the
foregoing, BNPLC may reasonably require (and unless and until Extreme is
otherwise notified by BNPLC, BNPLC does require) that such insurance be provided
under forms and by companies consistent with the following:

          (1)  Forms: CGL Insurance must be provided on Insurance Services
               -----
               Office ("ISO") forms CG 0001 1093 or CG 0001 0196 or equivalent
               substitute forms providing the same or greater coverage.

          (2)  Rating Requirements: Insurance must be provided through insurance
               -------------------
               or reinsurance companies rated by the A.M. Best Company of
               Oldwick, New Jersey as having a policyholder's rating of A or
               better and a reported financial information rating of X or
               better.

          (3)  Required Endorsements: CGL Insurance must be endorsed to provide
               ---------------------
               or include:

               (a)  ISO additional insured form CG 2026 1185 or equivalent
                    substitute form, without modification (and under the
                    commercial umbrella, if any), designating as additional
                    insureds "BNPLC and other Interested Parties, as defined in
                    the Common Definitions and Provisions Agreement
                    (Improvements) between Extreme Networks, Inc. and BNP
                    Leasing Corporation dated June 1, 2000)"; and

               (b)  provisions entitling BNPLC to 30 days' notice from the
                    insurer prior to any cancellation to the CGL coverage.

          (4)  Other Insurance: Each policy to contain standard CGL "other
               ---------------
               insurance" wording, unmodified in any way that would make it
               excess over or contributory with the additional insured's own
               commercial general liability coverage.


[Improvements]

<PAGE>

II.  PROPERTY INSURANCE:

     A.   Extreme must maintain property insurance in "special form" (including
theft) or against "all risks," providing the broadest available coverage for all
Improvements (as defined in the Common Provisions and Definitions Agreement) and
equipment included in the Property, on a blanket basis if multiple buildings are
involved, with no exclusions for vandalism, malicious mischief, or sprinkler
leakage and all coverage perils normally included within the definitions of
extended coverage, vandalism, malicious mischief and, if the Property is in a
flood zone, flood. In addition, boiler and machinery coverage must be maintained
at all times by endorsement to the property insurance policy or by separate
policy.

     B.   The property insurance required hereby must provide coverage in the
amount no less than replacement value (exclusive of land, foundation, footings,
excavations and grading) with endorsements for contingent liability from
operation of building laws, increased cost of construction and demolition costs
which may be necessary to comply with building laws. Subject to the approval of
BNPLC, Extreme will be responsible for determining the amount of property
insurance to be maintained from time to time, but Extreme must maintain such
coverage on an agreed value basis to eliminate the effects of coinsurance.

     C.   Any deductible or self-insured retention applicable to the property
insurance shall not exceed $500,000.

     D.   The property insurance shall cover not only the value of Extreme's
interest in the Improvements, but also the interest of BNPLC, with BNPLC shown
as an insured as its interests may appear.

     E.   The forms of insurance policies (including endorsements) used to
provide the property insurance required by this Improvements Lease, and the
insurance company or companies providing the property insurance, must be
acceptable to BNPLC. BNPLC shall have the right from time to time and at any
time to review and approve such policy forms (including endorsements) and the
insurance company or companies providing such insurance. Without limiting the
generality of the foregoing, BNPLC may reasonably require (and unless and until
Extreme is otherwise notified by BNPLC, BNPLC does require) that such insurance
be provided under forms and by companies consistent with the following:

          (1)  Rating Requirements: Insurance to be provided through insurance
               -------------------
          or reinsurance companies rated by the A.M. Best Company of Oldwick,
          New Jersey as having (a) a policyholder's rating of A or better, (b) a
          reported financial information rating of no less than X, and (c) in
          the case of each insurance or reinsurance company, a reported
          financial information rating which indicates an adjusted
          policyholders' surplus equal to or greater than the underwriting
          exposure that such company has under the insurance or reinsurance it
          is providing for the Property.

          (2)  Required Endorsements: Extreme's property insurance must be
               ---------------------
endorsed to provide or include:

               (a)  a waiver of subrogation in favor of "BNPLC and other
                    Interested Parties, as defined in the Common Definitions and
                    Provisions Agreement (Improvements) between Extreme
                    Networks, Inc. and BNP Leasing Corporation dated June 1,
                    2000)";

               (b)  that Extreme's insurance is primary, with any policies of
                    BNPLC or other Interested Parties being excess, secondary
                    and noncontributing;

               (c)  that the protection afforded to BNPLC by such insurance
                    shall not be reduced or impaired by acts or omissions of
                    Extreme or any other beneficiary or insured; and

                              Exhibit B - Page 2

[Improvements]
<PAGE>

               (d)  that BNPLC must be notified at least thirty days prior to
                    any cancellation of insurance coverage.


III. OTHER INSURANCE RELATED REQUIREMENTS:

     A.   BNPLC must be notified in writing immediately by Extreme of claims
against Extreme that might cause a reduction below seventy-five percent (75%) of
any aggregate limit of any policy.

     B.   Extreme's property insurance must be evidenced by ACORD form 27
"Evidence of Property Insurance" completed and interlineated in a manner
satisfactory to BNPLC to show compliance with the requirements of this Exhibit.
Copies of endorsements to the property insurance must be attached to such form.

     C.   Extreme's CGL insurance must be evidenced by ACORD form 25
"Certificate of Insurance" completed and interlineated in a manner satisfactory
to BNPLC to show compliance with the requirements of this Exhibit. Copies of
endorsements to the CGL insurance must be attached to such form.

     D.   Such evidence of required insurance must be delivered upon execution
of this Improvements Lease and new certificate or evidence of insurance must be
delivered no later than 10 days prior to expiration of existing policy.

     E.   Extreme shall not cancel, fail to renew, or make or permit any
material reduction in any of the policies or certificates described in this
Exhibit without the prior written consent of BNPLC. The certificates (ACORD
forms 27 and 25) described in this Exhibit must contain the following express
provision:

     "This is to certify that the policies of insurance described herein have
     been issued to the insured Extreme Networks, Inc. for whom this certificate
     is executed and are in force at this time. In the event of cancellation of
     coverage affecting the certificate holder, at least thirty days prior
     notice shall be given to the certificate holder."

     F.   The limits of liability under the liability insurance required by this
Improvements Lease may be provided by a single policy of insurance or by a
combination of primary and umbrella policies, but in no event shall the total
limits of liability available for any one occurrence or accident be less than
those required by this Exhibit.

     G.   Extreme shall provide copies, certified as complete and correct by an
authorized agent of the applicable insurer, of all insurance policies required
by this Exhibit within ten days after receipt of a request for such copies from
BNPLC.

                              Exhibit B - Page 3

[Improvements]
<PAGE>

                                   Exhibit C
                                   ---------

                        Notice of LIBOR Period Election


BNP Leasing Corporation
12201 Merit Drive
Suite 860
Dallas, Texas 75251
Attention: Lloyd G. Cox

     Re: Lease Agreement (Improvements) and Lease Agreement (Land), both dated
as of June 1, 2000, and both between Extreme Networks, Inc., as tenant, and BNP
Leasing Corporation, as landlord

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the two Lease Agreements referenced above. This letter
constitutes notice to you that the LIBOR Period Election under both of the Lease
Agreements shall be:

                                        ________________ month(s),

beginning with the first Base Rent Period that commences on or after:

                                        ______________, ____.


NOTE: YOU SHALL BE ENTITLED TO DISREGARD THIS NOTICE IF THE NUMBER OF MONTHS
----
SPECIFIED ABOVE IS NOT A PERMITTED NUMBER UNDER THE DEFINITION OF "LIBOR PERIOD
ELECTION" IN THE COMMON DEFINITIONS AND PROVISIONS AGREEMENTS REFERENCED IN THE
LEASE AGREEMENTS, OR IF THE DATE SPECIFIED ABOVE CONCERNING THE COMMENCEMENT OF
THE LIBOR PERIOD ELECTION IS LESS THAN TEN BUSINESS DAYS AFTER YOUR RECEIPT OF
THIS NOTICE. HOWEVER, WE ASK THAT YOU NOTIFY US IMMEDIATELY IF FOR ANY REASON
YOU BELIEVE THIS NOTICE IS DEFECTIVE.

     Executed this _____ day of ______________, 20___.


                                        Extreme Networks, Inc.

                                        Name:_________________________________
                                        Title:________________________________

[cc all Participants]







     [Improvements]
<PAGE>

                                  Schedule 1
                                  ----------

                              FINANCIAL COVENANTS

[DRAFTING NOTE: TK WILL MANUALLY SUBSTITUTE THE FINAL SCHEDULE 1 (A SEPARATE
 --------------
 WORD PROCESSING FILE) FOR THIS PAGE IN THE EXECUTION COPIES OF THIS DOCUMENT.]







     [Improvements]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.10
<SEQUENCE>6
<FILENAME>0006.txt
<DESCRIPTION>FORM OF PURCHASE AGREEMENT (LAND) JUNE 1, 2000
<TEXT>

<PAGE>

================================================================================
                                                                   EXHIBIT 10.10



                              PURCHASE AGREEMENT
                                    (LAND)

                                    BETWEEN

                            BNP LEASING CORPORATION


                                   ("BNPLC")

                                      AND

                            EXTREME NETWORKS, INC.

                                  ("Extreme")





                                 June 1, 2000

                           (Santa Clara, California)

================================================================================
<PAGE>

                               TABLE OF CONTENTS
                               -----------------

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
1.       Extreme's Options and Obligations on the Designated Sale Date........................................    1
         (A)      Right to Purchase; Initial Remarketing Rights and Obligations...............................    1
                  -------------------------------------------------------------
         (B)      Determinations Concerning Price.............................................................    3
                  -------------------------------
         (C)      Designation of the Purchaser................................................................    4
                  ----------------------------
         (D)      Effect of the Purchase Option and Extreme's Initial Remarketing Rights and Obligations on
                  -----------------------------------------------------------------------------------------
                  Subsequent Title Encumbrances...............................................................    4
                  -----------------------------
         (E)      Security for the Purchase Option and Extreme's Initial Remarketing Rights and Obligations...    4
                  -----------------------------------------------------------------------------------------
         (F)      Delivery of Books and Records If BNPLC Retains the Property.................................    5
                  -----------------------------------------------------------

2.       Extreme's Rights and Options After the Designated Sale Date..........................................    5
         (A)      Extreme's Extended Right to Remarket........................................................    5
                  ------------------------------------
         (B)      Definition of Minimum Extended Remarketing Price............................................    5
                  ------------------------------------------------
         (C)      BNPLC's Right to Sell.......................................................................    6
                  ---------------------
         (D)      Extreme's Right to Excess Sales Proceeds....................................................    7
                  ----------------------------------------
         (E)      Permitted Transfers During Extreme's Extended Remarketing Period............................    7
                  ----------------------------------------------------------------

3.       Terms of Conveyance Upon Purchase....................................................................    7

4.       Survival and Termination of the Rights and Obligations of Extreme and BNPLC..........................    8
         (A)      Status of this Agreement Generally..........................................................    8
                  ----------------------------------
         (B)      Automatic Termination of Extreme's Rights...................................................    8
                  -----------------------------------------
         (C)      Termination of Extreme's Extended Remarketing Rights to Permit a Sale by BNPLC..............    9
                  ------------------------------------------------------------------------------
         (D)      Payment Only to BNPLC.......................................................................    9
                  ---------------------
         (E)      Remedies Under the Other Operative Documents................................................    9
                  --------------------------------------------
         (F)      Occupancy by Extreme Prior to Closing of a Sale.............................................    9
                  -----------------------------------------------

5.       Security for Extreme's Obligations; Return of Funds..................................................    9

6.       Certain Remedies Cumulative..........................................................................   10

7.       Attorneys' Fees and Legal Expenses...................................................................   10

8.       Estoppel Certificate.................................................................................   10

9.       Successors and Assigns...............................................................................   10
</TABLE>

[Land]
<PAGE>

                            Exhibits and Schedules
                            ----------------------

Exhibit A......................................................Legal Description
---------

Exhibit B...................Requirements Re: Form of Grant Deed and Ground Lease
---------

Exhibit C............................................Bill of Sale and Assignment
---------

Exhibit D..........................................Acknowledgment and Disclaimer
---------

Exhibit E................................................Secretary's Certificate
---------

Exhibit F.................................Certificate Concerning Tax Withholding
---------

[Land]
<PAGE>

                              PURCHASE AGREEMENT
                                    (LAND)


     This PURCHASE AGREEMENT (LAND) (this "Agreement") is made and dated as of
June 1, 2000 (the "Effective Date") by and between BNP LEASING CORPORATION, a
Delaware corporation ("BNPLC"), and EXTREME NETWORKS, INC., a California
corporation ("Extreme").

                                   RECITALS

     Contemporaneously with the execution of this Agreement, BNPLC and Extreme
are executing a Common Definitions and Provisions Agreement (Land) dated as of
the Effective Date (the "Common Definitions and Provisions Agreement (Land)"),
which by this reference is incorporated into and made a part of this Agreement
for all purposes. As used in this Agreement, capitalized terms defined in the
Common Definitions and Provisions Agreement (Land) and not otherwise defined in
this Agreement are intended to have the respective meanings assigned to them in
the Common Definitions and Provisions Agreement (Land).

     Pursuant to the Acquisition Contract, which covers the Land described in
Exhibit A, BNPLC is acquiring the Land and any appurtenances thereto and the
---------
existing Improvements thereon from Seller contemporaneously with the execution
of this Agreement. Pursuant to the Lease Agreement (Land) executed by BNPLC and
Extreme contemporaneously with this Agreement (the "Land Lease"), BNPLC is
leasing the Land to Extreme. (All of BNPLC's interests, including those created
by the documents delivered at the closing under the Acquisition Contract, in the
Land and in all other real and personal property from time to time covered by
the Land Lease and included within the "Property" as defined therein are
hereinafter collectively referred to as the "Property". The Property does not
include the Improvements, it being understood that the Other Purchase Agreement
constitutes a separate agreement providing for the possible sale of the
Improvements and the appurtenances thereto, and only the Improvements and the
appurtenances thereto, from BNPLC to Extreme or a third party designated by
Extreme.)

     Extreme and BNPLC have reached agreement upon the terms and conditions upon
which Extreme will purchase or arrange for the purchase of the Property, and by
this Agreement they desire to evidence such agreement.

                                  AGREEMENTS

     1.   Extreme's Options and Obligations on the Designated Sale Date.

          (A)  Right to Purchase; Initial Remarketing Rights and Obligations.
               -------------------------------------------------------------
Whether or not an Event of Default shall have occurred and be continuing or the
Land Lease shall have been terminated, but subject to Paragraph 4 below:

               (1)  Extreme shall have the right (the "Purchase Option") to
     purchase or cause an Affiliate of Extreme to purchase the Property and
     BNPLC's interest in Escrowed Proceeds, if any, on the Designated Sale Date
     for a cash price equal to the Break Even Price (as defined below).

               (2)  If neither Extreme nor an Affiliate of Extreme purchases the
     Property and BNPLC's interest in any Escrowed Proceeds on the Designated
     Sale Date as provided in the preceding
<PAGE>

     subparagraph 1.(A)(1), then Extreme shall have the following rights and
     obligations (collectively, "Extreme's Initial Remarketing Rights and
     Obligations"):

               (a)  First, Extreme shall have the right (but not the obligation)
        to cause an Applicable Purchaser who is not an Affiliate of Extreme to
        purchase the Property and BNPLC's interest in any Escrowed Proceeds on
        the Designated Sale Date for a cash purchase price (the "Third Party
        Price") determined as provided below. If, however, the Break Even Price
        exceeds the sum of any Third Party Price tendered or to be tendered to
        BNPLC by an Applicable Purchaser and any Supplemental Payment paid by
        Extreme as described below, then BNPLC may affirmatively elect to
        decline such tender from the Applicable Purchaser and to keep the
        Property and any Escrowed Proceeds rather than sell to the Applicable
        Purchaser pursuant to this subparagraph (a "Voluntary Retention of the
        Property").

               (b)  Second, if the Third Party Price actually paid by an
        Applicable Purchaser to BNPLC on the Designated Sale Date exceeds the
        Break Even Price, Extreme shall be entitled to such excess, subject,
        however, to BNPLC's right to offset against such excess any and all sums
        that are then due from Extreme to BNPLC under the other Operative
        Documents.

               (c)  Third, if for any reason whatsoever (including a Voluntary
        Retention of the Property or a decision by Extreme not to exercise its
        right to purchase or cause an Applicable Purchaser to purchase from
        BNPLC as described above) neither Extreme nor an Applicable Purchaser
        pays a net cash price to BNPLC on the Designated Sale Date equal to or
        in excess of the Break Even Price in connection with a sale of the
        Property and BNPLC's interest in any Escrowed Proceeds pursuant to this
        Agreement, then Extreme shall have the obligation to pay to BNPLC on the
        Designated Sale Date a supplemental payment (the "Supplemental Payment")
        equal to the lesser of (1) the amount by which the Break Even Price
        exceeds such net cash price (if any) actually received by BNPLC on the
        Designated Sale Date (such excess being hereinafter called a
        "Deficiency") or (2) the Maximum Remarketing Obligation. As used herein,
        the "Maximum Remarketing Obligation" means a dollar amount determined in
        accordance with the following provisions:

                         1)   The "Maximum Remarketing Obligation" will equal
          the product of (i) Stipulated Loss Value on the Designated Sale Date,
          times (ii) 100% minus the Residual Risk Percentage, provided that both
          of the following conditions are satisfied:

                              (x)  Extreme shall not have elected to accelerate
               the Designated Sale Date as provided in clause (2) of the
               definition of Designated Sale Date in the Common Definitions and
               Provisions Agreement (Land).

                              (y)  No Event of Default, other than an Issue 97-1
               Non-performance-related Subjective Event of Default, shall occur
               on or be continuing on the Designated Sale Date.

                         2)   If either of the conditions listed in subparagraph
          1) preceding are not satisfied, the "Maximum Remarketing Obligation"
          will equal the Break Even Price.

If any Supplemental Payment or other amount payable to BNPLC pursuant to this
subparagraph 1.(A) is not actually paid to BNPLC on the Designated Sale Date,
Extreme shall pay interest on the past due amount computed at the Default Rate
from the Designated Sale Date.

[Land]

                                       2
<PAGE>

          (B)  Determinations Concerning Price.
               -------------------------------

               (1)  Determination of the Break Even Price. As used herein,
                    -------------------------------------
"Break Even Price" means an amount equal, on the Designated Sale Date, to
Stipulated Loss Value, plus all out-of-pocket costs and expenses (including
                       ----
appraisal costs, withholding taxes (if any) not constituting Excluded Taxes, and
Attorneys' Fees) incurred by BNPLC in connection with any sale of BNPLC's
interests in the Property under this Agreement or in connection with collecting
payments due hereunder, but less the aggregate amounts (if any) of Direct
                        --------
Payments to Participants and Deposit Taker Losses.

               (2)  Determination of Third Party Price.  The Third Party Price
                    ----------------------------------
required of any Applicable Purchaser purchasing from BNPLC under
subparagraph 1.(A)(2)(a) will be determined as follows:

               (a)  Extreme may give a notice (a "Remarketing Notice") to BNPLC
          and to each of the Participants no earlier than one hundred twenty
          days before the Designated Sale Date and no later than ninety days
          before the Designated Sale Date, specifying an amount as the Third
          Party Price that Extreme believes in good faith to constitute
          reasonably equivalent value for the Property and any Escrowed
          Proceeds. Once given, a Remarketing Notice shall not be rescinded or
          modified without BNPLC's written consent.

               (b)  If BNPLC believes in good faith that the Third Party Price
          specified by Extreme in a Remarketing Notice does not constitute
          reasonably equivalent value for the Property and any Escrowed
          Proceeds, BNPLC may at any time before sixty days prior to the
          Designated Sale Date respond to the Remarketing Notice with a notice
          back to Extreme, objecting to the Third Party Price so specified by
          Extreme. If BNPLC receives a Remarketing Notice, yet does not respond
          with an objection as provided in the preceding sentence, the Third
          Party Price suggested by Extreme in the Remarketing Notice will be the
          Third Party Price for purposes of this Agreement. If, however, BNPLC
          does respond with an objection as provided in this subparagraph, and
          if Extreme and BNPLC do not otherwise agree in writing upon a Third
          Party Price, then the Third Party Price will be the lesser of (I) fair
          market value of the Property, plus the amount of any Escrowed
          Proceeds, as determined by a professional independent appraiser
          selected by BNPLC, or (II) the Break Even Price.

               (c)  If for any reason, including an acceleration of the
          Designated Sale Date as provided in the definition thereof in the
          Common Definitions and Provisions Agreement (Land), Extreme does not
          deliver a Remarketing Notice to BNPLC within the time period specified
          above, then the Third Party Price will be an amount determined in good
          faith by BNPLC as constituting reasonably equivalent value for the
          Property and any Escrowed Proceeds, but in no event more than the
          Break Even Price.

If any payment to BNPLC by an Applicable Purchaser hereunder is held to
constitute a preference or a voidable transfer under Applicable Law, or must for
any other reason be refunded by BNPLC to the Applicable Purchaser or to another
Person, and if such payment to BNPLC reduced or had the effect of reducing a
Supplemental Payment or increased or had the effect of increasing any excess
sale proceeds paid to Extreme pursuant to subparagraph 1(A)(2)(b) or pursuant to
subparagraph 2.(D), then Extreme shall pay to BNPLC upon demand an amount equal
to the reduction of the Supplemental Payment or to the increase of the excess
sale proceeds paid to Extreme, as applicable, and this Agreement shall continue
to

[Land]

                                       3
<PAGE>

     be effective or shall be reinstated as necessary to permit BNPLC to enforce
     its right to collect such amount from Extreme.

          (C)  Designation of the Purchaser. To give BNPLC the opportunity
               ----------------------------
before the Designated Sale Date to prepare the deed and other documents that
BNPLC must tender pursuant to Paragraph 3 (collectively, the "Sale Closing
Documents"), Extreme must, by a notice to BNPLC given at least seven days prior
to the Designated Sale Date, specify irrevocably, unequivocally and with
particularity the party who will purchase the Property in order to satisfy the
obligations of Extreme set forth in subparagraph 1(A). If for any reason Extreme
                                                 ----
fails to so specify a party who will in accordance with the terms and conditions
set forth herein purchase the Property (be it Extreme itself, an Affiliate of
Extreme or another Applicable Purchaser), BNPLC shall be entitled to postpone
the tender of the Sale Closing Documents until a date after the Designated Sale
Date and not more than twenty days after Extreme finally does so specify a
party, but such postponement will not relieve or postpone the obligation of
Extreme to make a Supplemental Payment on the Designated Sale Date as provided
in Paragraph 1.(A)(2)(c).

          (D)  Effect of the Purchase Option and Extreme's Initial Remarketing
               ---------------------------------------------------------------
Rights and Obligations on Subsequent Title Encumbrances. Any conveyance of the
-------------------------------------------------------
Property to Extreme or any Applicable Purchaser pursuant to this Paragraph 1.(A)
shall cut off and terminate any interest in the Land or other Property claimed
by, through or under BNPLC, including any interest claimed by the Participants
and including any Liens Removable by BNPLC (such as, but not limited to, any
judgment liens established against the Property because of a judgment rendered
against BNPLC and any leasehold or other interests conveyed by BNPLC in the
ordinary course of BNPLC's business), but not including personal obligations of
Extreme to BNPLC under the Land Lease or other Operative Documents (including
obligations arising under the indemnities therein). Anyone accepting or taking
any interest in the Property by or through BNPLC after the date of this
Agreement shall acquire such interest subject to the Purchase Option and
Extreme's Initial Remarketing Rights and Obligations. Further, Extreme and any
Applicable Purchaser shall be entitled to pay any payment required by this
Agreement for the purchase of the Property directly to BNPLC notwithstanding any
prior conveyance or assignment by BNPLC, voluntary or otherwise, of any right or
interest in this Agreement or the Property, and neither Extreme nor any
Applicable Purchaser shall be responsible for the proper distribution or
application of any such payments by BNPLC; and any such payment to BNPLC shall
discharge the obligation of Extreme to cause such payment to all Persons
claiming an interest in such payment. Contemporaneously with the execution of
this Agreement, the parties shall record a memorandum of this Agreement for
purposes of effecting constructive notice to all Persons of Extreme's rights
under this Agreement, including its rights under this subparagraph.

          (E)  Security for the Purchase Option and Extreme's Initial
               ------------------------------------------------------
Remarketing Rights and Obligations. To secure BNPLC's obligation to sell the
-----------------------------------
Property pursuant to Paragraph 1.(A) and to pay any damages to Extreme caused by
a breach of such obligations, including any such breach caused by a rejection or
termination of this Agreement in any bankruptcy or insolvency proceeding
instituted by or against BNPLC, as debtor, BNPLC does hereby grant to Extreme a
lien and security interest against all rights, title and interests of BNPLC from
time to time in and to the Land and other Property. Extreme may enforce such
lien and security interest judicially after any such breach by BNPLC, but not
otherwise. Contemporaneously with the execution of this Agreement, Extreme and
BNPLC will execute a memorandum of this Agreement which is in recordable form
and which specifically references the lien granted in this subparagraph, and
Extreme shall be entitled to record such memorandum at any time prior to the
Designated Sale Date.

          (F)  Delivery of Books and Records If BNPLC Retains the Property.
               ----------------------------------------------------------
Unless Extreme or its Affiliate or another Applicable Purchaser purchases the
Property pursuant to Paragraph 1.(A), promptly after the Designated Sale Date
Extreme shall deliver to BNPLC copies of books and records of Extreme which will
be necessary or useful to any future owner's or occupant's use of the Property.

[Land]

                                       4
<PAGE>

          2.      Extreme's Rights and Options after the Designated Sale Date.

                  (A)    Extreme's Extended Right to Remarket. During the two
                         ------------------------------------
years following the Designated Sale Date ("Extreme's Extended Remarketing
Period"), Extreme shall have the right ("Extreme's Extended Remarketing Right")
to cause an Applicable Purchaser who is not an Affiliate of Extreme to purchase
the Property for a cash purchase price not below the Minimum Extended
Remarketing Price (as defined below). Extreme's Extended Remarketing Right
shall, however, be subject to all of the following conditions:

                         (1)  The Property and BNPLC's interest in Escrowed
          Proceeds, if any, shall not have been sold on the Designated Sale Date
          as provided in Paragraph 1 or within the thirty days thereafter as
          provided in subparagraph 4.(B).

                         (2)  No Voluntary Retention occurred as described in
          subparagraph 1.(A)(2)(a).

                         (3)  Extreme's Extended Remarketing Right shall not
          have been terminated pursuant to subparagraph 4.(B) below because of
          Extreme's failure to make any Supplemental Payment required on the
          Designated Sale Date.

                         (4)  Extreme's Extended Remarketing Right shall not
          have been terminated by BNPLC pursuant to subparagraph 4.(C) below to
          facilitate BNPLC's sale of the Property to a third party in accordance
          with subparagraph 2.(C).

                         (5)  At least thirty days prior to the date upon which
          BNPLC is to convey the Property to an Applicable Purchaser because of
          Extreme's exercise of Extreme's Extended Remarketing Right (the "Final
          Sale Date"), Extreme shall have notified BNPLC of (x) the date
          proposed by Extreme as the Final Sale Date (which must be a Business
          Day), (y) the full legal name of the Applicable Purchaser and such
          other information as will be required to prepare the Sale Closing
          Documents, and (z) the amount of the purchase price that the
          Applicable Purchaser will pay (consistent with the minimum required
          pursuant to the other provisions of this subparagraph 2.(A)) for the
          Property.

                  (B)    Definition of Minimum Extended Remarketing Price. As
                         ------------------------------------------------
used herein, the "Minimum Extended Remarketing Price" means, subject to
reduction as provided in subparagraph 2.(C) below, an amount equal to the sum of
the following:

                         (1)  the amount by which the Break Even Price computed
          on the Designated Sale Date exceeds any Supplemental Payment actually
          paid to BNPLC on the Designated Sale Date, together with interest on
          such excess computed at the Default Rate from the period commencing on
          the Designated Sale Date and ending on the Final Sale Date, plus
                                                                      ----

                         (2)  all out-of-pocket costs and expenses (including
          withholding taxes [if any], other than Excluded Taxes, and Attorneys'
          Fees) incurred by BNPLC in connection with the sale to the Applicable
          Purchaser, to the extent not already included in the computation of
          Break Even Price, and plus
                            --------

                         (3)  the sum of all Impositions, insurance premiums and
          other Losses of every kind suffered or incurred by BNPLC or any other
          Interested Party with respect to the ownership, operation or
          maintenance of the Property on or after the Designated Sale Date,
          together with interest on such Impositions, insurance premiums and
          other Losses computed at the Default Rate from the date paid or
          incurred to the Final Sale Date.

[Land]

                                       5
<PAGE>

If, however, Losses described in the preceding clause (3) consist of claims
against BNPLC or another Interested Party that have not been liquidated prior to
the Final Sale Date (and, thus, such Losses have yet to be fixed in amount as of
the Final Sale Date), then Extreme may elect to exclude any such Losses from the
computation of the Minimum Extended Remarketing Price by providing to BNPLC, for
the benefit of BNPLC and other Interested Parties, a written agreement to
indemnify and defend BNPLC and other Interested Parties against such Losses. To
be effective hereunder for purposes of reducing the Minimum Extended Remarketing
Price (and, thus, the Break Even Price), any such written indemnity must be
fully executed and delivered by Extreme on or prior to the Final Sale Date, must
include provisions comparable to subparagraphs 5(c)(ii), (iii), (iv) and (v) of
                                 -------------------------------------------
the Land Lease and otherwise must be in form and substance satisfactory to
BNPLC.

          (C)  BNPLC's Right to Sell. After the Designated Sale Date, if the
               ---------------------
Property has not already been sold by BNPLC pursuant to Paragraph 1 or this
Paragraph 2, BNPLC shall have the right to sell the Property or offer the
Property for sale to any third party on any terms believed to be appropriate by
BNPLC in its sole good faith business judgment; provided, however, that so long
as the conditions to Extreme's Extended Remarketing Rights specified in
subparagraph 2.(A) continue to be satisfied:

               (1)  BNPLC shall not sell the Property to an Affiliate of BNPLC
     on terms less favorable than those which BNPLC would require from a
     prospective purchaser not an Affiliate of BNPLC;

               (2)  If BNPLC receives or desires to make a written proposal
     (whether in the form of a "letter of intent" or other nonbinding expression
     of interest or in the form of a more definitive purchase and sale
     agreement) for a sale of the Property to a prospective purchaser (a "Third
     Party Sale Proposal"), and if on the basis of such Third Party Sale
     Proposal BNPLC expects to enter into or to pursue negotiations for a
     definitive purchase and sale agreement with the prospective purchaser, then
     prior to executing any such definitive agreement, BNPLC shall submit the
     Third Party Sale Proposal to Extreme with a notice (the "Third Party Sale
     Notice") explaining that (A) BNPLC is then prepared to accept a price not
     below an amount specified in such Third Party Sale Notice (the "Third Party
     Target Price") if BNPLC and the prospective purchaser reach agreement on
     other terms and conditions to be incorporated into a definitive purchase
     and sale agreement, and (B) Extreme's Extended Remarketing Right may be
     terminated pursuant to subparagraph 4.(C) of this Agreement unless Extreme
     causes an Applicable Purchaser to consummate a purchase of the Property
     pursuant to this Paragraph 2 within ninety days after the date of such
     Third Party Sale Notice.

For a period of ninety days (but only ninety days) after the date of any Third
Party Sale Notice, the Minimum Extended Remarketing Price shall be limited in
amount so that it does not exceed the Third Party Target Price specified by
BNPLC therein. Accordingly, if BNPLC has delivered a Third Party Sale Notice
specifying a Third Party Target Price below the Minimum Extended Remarketing
Price calculated as provided in subparagraph 2.(B) within the ninety days prior
to the Final Sale Date for any sale to an Applicable Purchaser by BNPLC pursuant
to this Paragraph 2, then the Minimum Extended Remarketing Price applicable to
such sale shall be reduced to the amount of the Third Party Target Price so
specified. Such a reduction, however, will apply only to a sale to an Applicable
Purchaser actually consummated within the ninety days after the date of the
applicable Third Party Sale Notice.

          (D)  Extreme's Right to Excess Sales Proceeds. If the cash price
               ----------------------------------------
actually paid by any third party purchasing the Property from BNPLC during
Extreme's Extended Remarketing Period, including any price paid by an Applicable
Purchaser purchasing from BNPLC pursuant to this Paragraph 2, exceeds the
Minimum Extended Remarketing Price (calculated as provided in subparagraph
2.(B), without reduction pursuant to

[Land]

                                       6
<PAGE>

subparagraph 2.(C)), then Extreme shall be entitled to the excess; provided,
that BNPLC may offset and retain from the excess any and all sums that are then
due and unpaid from Extreme to BNPLC under any of the Operative Documents.

          (E)  Permitted Transfers During Extreme's Extended Remarketing Period.
               ----------------------------------------------------------------
Any "Permitted Transfer" described in clause (6) of the definition thereof in
                                      ----------
the Common Definitions and Provisions Agreement (Land) to an Affiliate of BNPLC
or that covers BNPLC's entire interest in the Land will be subject to Extreme's
Extended Remarketing Right if, at the time of the Permitted Transfer, Extreme's
Extended Remarketing Right has not expired or been terminated as provided
herein. Any other Permitted Transfer described in clause (6) of the definition
thereof, however, will not be subject to Extreme's Extended Remarketing Right.
Thus, for example, BNPLC's conveyance of a utility easement or space lease more
than thirty days after the Designated Sale Date to a Person not an Affiliate of
BNPLC shall not be subject to Extreme's Extended Remarketing Right, though
following the conveyance of the lesser estate, Extreme's Extended Remarketing
Right may continue to apply to BNPLC's remaining interest in the Land and any
Personal Property.

     3    Terms of Conveyance Upon Purchase. As necessary to consummate any sale
of the Property to Extreme or an Applicable Purchaser pursuant to this
Agreement, BNPLC must, subject to any postponement permitted by subparagraph
1.(C), promptly after the tender of the purchase price and any other payments to
BNPLC required pursuant to Paragraph 1 or Paragraph 2, as applicable, convey all
of BNPLC's right, title and interest in the Land and other Property to Extreme
or the Applicable Purchaser, as the case may be, by BNPLC's execution,
acknowledgment (where appropriate) and delivery of the Sale Closing Documents.
Such conveyance by BNPLC will be subject only to the Permitted Encumbrances and
any other encumbrances that do not constitute Liens Removable by BNPLC. However,
such conveyance shall not include the rights of BNPLC or other Interested
Parties under the indemnities provided in the Operative Documents, including
rights to any payments then due from Extreme under the indemnities or that may
become due thereafter because of any expense or liability incurred by BNPLC or
another Interested Party resulting in whole or in part from events or
circumstances occurring or alleged to have occurred before such conveyance. All
costs, both foreseen and unforeseen, of any purchase by Extreme or an Applicable
Purchaser hereunder shall be the responsibility of the purchaser. The Sale
Closing Documents used to accomplish such conveyance shall consist of the
following: (1) a Corporation Grant Deed in the form attached as Exhibit B-1 or
                                                                -----------
Exhibit B-2 or Exhibit B-4, as required by Exhibit B, (2) if required by Exhibit
-----------    -----------                 ---------                     -------
B, a Ground Lease in the form attached as Exhibit B-3, which Extreme or the
-                                         -----------
Applicable Purchase must execute and return to BNPLC, (3) a Bill of Sale and
Assignment in the form attached as Exhibit C, (4) an Acknowledgment of
                                   ---------
Disclaimer of Representations and Warranties, in the form attached as Exhibit D,
                                                                      ---------
which Extreme or the Applicable Purchaser must execute and return to BNPLC, (5)
a Secretary's Certificate in the form attached as Exhibit E, and (6) a
                                                  ---------
certificate concerning tax withholding in the form attached as Exhibit F. If for
                                                               ---------
any reason BNPLC fails to tender the Sale Closing Documents as required by this
Paragraph 3, BNPLC may cure such refusal at any time before thirty days after
receipt of a demand for such cure from Extreme.

     4    Survival and Termination of the Rights and Obligations of Extreme and
Bnplc.

          (A)  Status of this Agreement Generally. Except as expressly provided
               ----------------------------------
herein, this Agreement shall not terminate; nor shall Extreme have any right to
terminate this Agreement; nor shall Extreme be entitled to any reduction of the
Break Even Price, any Deficiency, the Maximum Remarketing Obligation, any
Supplemental Payment or the Minimum Extended Remarketing Price hereunder; nor
shall the obligations of Extreme to BNPLC under Paragraph 1 be affected, by
reason of (i) any damage to or the destruction of all or any part of the
Property from whatever cause (though it is understood that Extreme will receive
any remaining Escrowed Proceeds yet to be applied as provided in the Land Lease
that may result from such damage if Extreme purchases the Property and the
Escrowed Proceeds as herein provided), (ii) the taking of or damage to the
Property or any portion thereof by eminent domain or otherwise for any reason
(though it is understood that Extreme will receive any remaining

[Land]

                                       7
<PAGE>

Escrowed Proceeds yet to be applied as provided in the Land Lease that may
result from such taking or damage if Extreme purchases the Property and the
Escrowed Proceeds as herein provided), (iii) the prohibition, limitation or
restriction of Extreme's us e of all or any portion of the Property or any
interference with such use by governmental action or otherwise, (iv) any
eviction of Extreme or any party claiming under Extreme by paramount title or
otherwise, (v) Extreme's prior acquisition or ownership of any interest in the
Property, (vi) any default on the part of BNPLC under this Agreement, the Land
Lease or any other agreement to which BNPLC is a party, or (vii) any other
cause, whether similar or dissimilar to the foregoing, any existing or future
law to the contrary notwithstanding. It is the intention of the parties hereto
that the obligations of Extreme hereunder (including the obligation to make any
Supplemental Payment as provided in Paragraph 1) shall be separate and
independent covenants and agreements from BNPLC's obligations under this
Agreement or any other agreement between BNPLC and Extreme; provided, however,
that nothing in this subparagraph shall excuse BNPLC from its obligation to
tender the Sale Closing Documents in substantially the form attached hereto as
exhibits when required by Paragraph 3. Further, nothing in this subparagraph
shall be construed as a waiver by Extreme of any right Extreme may have at law
or in equity to the following remedies, whether because of BNPLC's failure to
remove a Lien Removable by BNPLC or because of any other default by BNPLC under
this Agreement: (i) the recovery of monetary damages, (ii) injunctive relief in
case of the violation, or attempted or threatened violation, by BNPLC of any of
the express covenants, agreements, conditions or provisions of this Agreement
which are binding upon BNPLC, or (iii) a decree compelling performance by BNPLC
of any of the express covenants, agreements, conditions or provisions of this
Agreement which are binding upon BNPLC.

          (B)  Automatic Termination of Extreme's Rights. Without limiting
               -----------------------------------------
BNPLC's right to enforce Extreme's obligation to pay any Supplemental Payment or
other amounts required by this Agreement, the rights of Extreme (to be
distinguished from the obligations of Extreme) included in Extreme's Initial
Remarketing Rights and Obligations, the Purchase Option and Extreme's Extended
Remarketing Rights shall all terminate automatically if Extreme shall fail to
pay the full amount of any Supplemental Payment required by subparagraph
1.(A)(2)(c) on the Designated Sale Date or if BNPLC shall elect a Voluntary
Retention of the Property as provided in subparagraph 1.(A)(2)(a).
Notwithstanding anything in this subparagraph to the contrary, however, even
after a failure to pay any required Supplemental Payment on the Designated Sale
Date, Extreme may nonetheless tender to BNPLC the full Break Even Price and all
amounts then due under the Operative Documents, together with interest on the
total Break Even Price computed at the Default Rate from the Designated Sale
Date to the date of tender, on any Business Day within thirty days after the
Designated Sale Date, and if presented with such a tender within thirty days
after the Designated Sale Date, BNPLC must accept it and promptly thereafter
deliver any Escrowed Proceeds and the Sale Closing Documents listed in Paragraph
3 to Extreme.

          (C)  Termination of Extreme's Extended Remarketing Rights to Permit a
               ----------------------------------------------------------------
Sale by BNPLC. At any time more than ninety days after BNPLC has delivered a
-------------
Third Party Sale Notice to Extreme as described in subparagraph 2.(C)(2), BNPLC
may terminate Extreme's Extended Remarketing Rights contemporaneously with the
consummation of a sale of the Property by BNPLC to any third party (be it the
prospective purchaser named in the Third Party Sale Notice or another third
party) at a price equal to or in excess of the Third Party Target Price
specified in the Third Party Sale Notice, so as to permit the sale of the
Property unencumbered by Extreme's Extended Remarketing Rights.

          (D)  Payment Only to BNPLC. All amounts payable under this Agreement
               ---------------------
by Extreme and, if applicable, by an Applicable Purchaser must be paid directly
to BNPLC, and no payment to any other party shall be effective for the purposes
of this Agreement. In addition to the payments required under subparagraph
1.(A), on the Designated Sale Date Extreme must pay all amounts then due to
BNPLC under the Land Lease or other Operative Documents. This subparagraph shall
not, however, be construed to limit Extreme's right to require the deduction of
Direct Payments to Participants and Deposit Taker Losses in the calculation of
the Break Even Price as provided in subparagraph 1.(B)(1).

[Land]                                 8
<PAGE>

          (E)  Remedies Under the Other Operative Documents. No repossession of
               --------------------------------------------
or re-entering upon the Property or exercise of any other remedies available to
BNPLC under the Land Lease or other Operative Documents shall terminate
Extreme's rights or obligations hereunder, all of which shall survive BNPLC's
exercise of remedies under the other Operative Documents. Extreme acknowledges
that the consideration for this Agreement is separate and independent of the
consideration for the Land Lease and the Closing Certificate, and Extreme's
obligations hereunder shall not be affected or impaired by any event or
circumstance that would excuse Extreme from performance of its obligations under
such other Operative Documents.

          (F)  Occupancy by Extreme Prior to Closing of a Sale. Prior to the
               -----------------------------------------------
closing of any sale of the Property to Extreme or an Applicable Purchaser
hereunder, Extreme's occupancy of the Land and its use of the Property shall
continue to be subject to the terms and conditions of the Land Lease, including
the terms setting forth Extreme's obligation to pay rent, prior to any
termination or expiration of the Land Lease pursuant to its express terms and
conditions.

     5    Security for Extreme's Obligations; Return of Funds. Extreme's
obligations under this Agreement are secured by the Pledge Agreement, reference
to which is hereby made for a description of the Collateral covered thereby and
the rights and remedies provided to BNPLC thereby. Although the collateral agent
appointed for BNPLC as provided in the Pledge Agreement shall be entitled to
hold all Collateral as security for the full and faithful performance by Extreme
of Extreme's covenants and obligations under this Agreement, the Collateral
shall not be considered an advance payment of the Break Even Price or any
Supplemental Payment or a measure of BNPLC's damages should Extreme breach this
Agreement. If Extreme does breach this Agreement and fails to cure the same
within any time specified herein for the cure, BNPLC may, from time to time,
without prejudice to any other remedy and without notice to Extreme, require the
collateral agent to immediately apply the proceeds of any disposition of the
Collateral (and any cash included in the Collateral) to amounts then due
hereunder from Extreme. If by a Permitted Transfer BNPLC conveys its interest in
the Property before the Designated Sale Date, BNPLC may also assign BNPLC's
interest in the Collateral to the transferee. BNPLC shall be entitled to return
any Collateral not sold or used to satisfy the obligations secured by the Pledge
Agreement directly to Extreme notwithstanding any prior actual or attempted
conveyance or assignment by Extreme, voluntary or otherwise, of any right to
receive the same; neither BNPLC nor the collateral agent named in the Pledge
Agreement shall be responsible for the proper distribution or application by
Extreme of any such Collateral returned to Extreme; and any such return of
Collateral to Extreme shall discharge any obligation of BNPLC to deliver such
Collateral to all Persons claiming an interest in the Collateral. Further, BNPLC
shall be entitled to deliver any Escrowed Proceeds it holds on the Designated
Sale Date directly to Extreme or to any Applicable Purchaser purchasing BNPLC's
interest in the Property and the Escrowed Proceeds pursuant to this Agreement
notwithstanding any prior actual or attempted conveyance or assignment by
Extreme, voluntary or otherwise, of any right to receive the same; BNPLC shall
not be responsible for the proper distribution or application by Extreme or any
Applicable Purchaser of any such Escrowed Proceeds paid over to Extreme or the
Applicable Purchaser; and any such payment of Escrowed Proceeds to Extreme or an
Applicable Purchaser shall discharge any obligation of BNPLC to deliver the same
to all Persons claiming an interest therein.

     6    Certain Remedies Cumulative. No right or remedy herein conferred upon
or reserved to BNPLC is intended to be exclusive of any other right or remedy
BNPLC has with respect to the Property, 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 at law or in equity or by statute. In addition to
other remedies available under this Agreement, either party shall be entitled,
to the extent permitted by applicable law, to a decree compelling performance of
any of the other party's agreements hereunder.

[Land]                                 9
<PAGE>

     7    Attorneys' Fees and Legal Expenses. If either party to this Agreement
commences any legal action or other proceeding to enforce any of the terms of
this Agreement, or because of any breach by the other party or dispute
hereunder, the party prevailing in such action or proceeding shall be entitled
to recover from the other party all Attorneys' Fees incurred in connection
therewith, whether or not such controversy, claim or dispute is prosecuted to a
final judgment. Any such Attorneys' Fees incurred by either party in enforcing a
judgment in its favor under this Agreement shall be recoverable separately from
such judgment, and the obligation for such Attorneys' Fees is intended to be
severable from other provisions of this Agreement and not to be merged into any
such judgment.

     8    Estoppel Certificate. Upon request by BNPLC, Extreme shall execute,
acknowledge and deliver a written statement certifying that this Agreement is
unmodified and in full effect (or, if there have been modifications, that this
Agreement is in full effect as modified, and setting forth such modification)
and either stating that no default exists hereunder or specifying each such
default of which Extreme has knowledge. Any such statement may be relied upon by
any Participant or prospective purchaser or assignee of BNPLC with respect to
the Property.

     9    Successors and Assigns. The terms, provisions, covenants and
conditions hereof shall be binding upon Extreme and BNPLC and their respective
permitted successors and assigns and shall inure to the benefit of Extreme and
BNPLC and all permitted transferees, mortgagees, successors and assignees of
Extreme and BNPLC with respect to the Property; provided, that (A) the rights of
BNPLC hereunder shall not pass to Extreme or any Applicable Purchaser or any
subsequent owner claiming through Extreme or an Applicable Purchaser, (B) BNPLC
shall not assign this Agreement or any rights hereunder except pursuant to a
Permitted Transfer, and (C) Extreme shall not assign this Agreement or any
rights hereunder without the prior written consent of BNPLC.

                           [Signature pages follow.]

[Land]                                10
<PAGE>

     IN WITNESS WHEREOF, Extreme and BNPLC have caused this Agreement to be
executed as of June 1, 2000.


                                             "Extreme"

                                             EXTREME NETWORKS, INC.


                                             By:  ______________________________
                                                  Name:_________________________
                                                  Title:________________________
<PAGE>

[Continuation of signature pages to Purchase Agreement (Land) dated to be
effective June 1, 2000]


                                             "BNPLC"

                                             BNP LEASING CORPORATION


                                             By:  ______________________________
                                                  Lloyd G. Cox, Vice President
<PAGE>

                                   Exhibit A
                                   ---------

                               LEGAL DESCRIPTION

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

[Land]
<PAGE>

                                   Exhibit B
                                   ---------

             Requirements Re: Form of Grant Deed and Ground Lease

The form of deed to be used to convey BNPLC's interest in the Land to Extreme or
an Applicable Purchaser will depend upon whether BNPLC's interest in the
Improvements has been or is being conveyed at the same time to the same party.

If BNPLC's interests in both the Land and the Improvements are to be conveyed to
Extreme or an Applicable Purchaser at the same time, because a sale under this
Purchase Agreement and a sale under the Other Purchase Agreement (covering the
Improvements) are being consummated at the same time and to the same party, then
the one deed in form attached as Exhibit B-1 will be used to convey both.
                                 -----------

If, however, a sale of BNPLC's interest in the Improvements pursuant to the
Other Purchase Agreement has not been consummated before, and is not being
consummated contemporaneously with the sale of BNPLC's interest in the Land
under this Agreement, then BNPLC's interest in the Land will be conveyed by a
deed in the from attached as Exhibit B-2, and BNPLC and the grantee under such
                             -----------
deed shall, as a condition to BNPLC's obligation to deliver the deed, execute
and deliver a Ground Lease covering the Land in the form attached hereto as
Exhibit B-3.
-----------

Finally, BNPLC's interest in the Land will be conveyed by a deed in the from
attached as Exhibit B-4 if BNPLC's interest in the Improvements has been sold
pursuant to the Other Purchase Agreement before a sale of BNPLC's interest in
the Land under this Agreement, or if BNPLC's interest in the Improvements is
being sold contemporaneously with a sale of BNPLC's interest in the Land, but
the purchaser of the Improvements is not the same as the purchaser of the Land.

[Land]
<PAGE>

                                  Exhibit B-1
                                  -----------

                            CORPORATION GRANT DEED


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
-------------------------

NAME:[Extreme or the Applicable Purchaser]
ADDRESS:  ___________________________
ATTN:     ___________________________
CITY:     ___________________________
STATE:___________________________
Zip:      ___________________________

MAIL TAX STATEMENTS TO:
----------------------

NAME:[Extreme or the Applicable Purchaser]
ADDRESS:  ___________________________
ATTN:     ___________________________
CITY:     ___________________________
STATE:___________________________
Zip:      ___________________________


                            CORPORATION GRANT DEED
                       (Covering Land and Improvements)

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, BNP
LEASING CORPORATION, a Delaware corporation ("Grantor"), hereby grants to
[Extreme or the Applicable Purchaser] ("Grantee") all of Grantor's interest in
the land situated in Santa Clara, California, described on Annex A attached
hereto and hereby made a part hereof and all improvements on such land, together
with the any other right, title and interest of Grantor in and to any easements,
rights-of-way, privileges and other rights appurtenant to such land or the
improvements thereon; provided, however, that this grant is subject to the
encumbrances described on Annex B (the "Permitted Encumbrances"). Grantee hereby
assumes the obligations (including any personal obligations) of Grantor, if any,
created by or under, and agrees to be bound by the terms and conditions of, the
Permitted Encumbrances to the extent that the same concern or apply to the land
or improvements conveyed by this deed.

[Land]
<PAGE>

                                             BNP LEASING CORPORATING

Date: As of __________                       By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

                                             [Extreme or Applicable Purchaser]

Date: As of __________                       By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

STATE OF _____________   )
                         )    SS
COUNTY OF ____________   )

     On ___________________ before me,__________, personally appeared_________
and__________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.


     Signature_________________________________

[Land]                       Exhibit B-1 - Page 2
<PAGE>

STATE OF _____________   )
                         )    SS
COUNTY OF ____________   )


     On ___________________ before me,__________, personally appeared__________
and___________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.



     Signature____________________________

[Land]                       Exhibit B-1 - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION

[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
--------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DEED TO WHICH THIS DESCRIPTION IS ATTACHED IS
ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

[Land]                       Exhibit B-1 - Page 4
<PAGE>

                                    Annex B

                            Permitted Encumbrances

[DRAFTING NOTE: TO THE EXTENT THAT ENCUMBRANCES (OTHER THAN "LIENS REMOVABLE BY
---------------
BNPLC") ARE IDENTIFIED IN ADDITION TO THOSE DESCRIBED BELOW, SUCH ADDITIONAL
ENCUMBRANCES WILL BE ADDED TO THE LIST BELOW AND THIS "DRAFTING NOTE" WILL BE
DELETED BEFORE THIS DEED IS ACTUALLY EXECUTED AND DELIVERED BY BNPLC. SUCH
ADDITIONAL ENCUMBRANCES WOULD INCLUDE ANY NEW ENCUMBRANCES APPROVED BY BNPLC AS
"PERMITTED ENCUMBRANCES" UNDER THE LAND LEASE OR THE OTHER LEASE AGREEMENT FROM
TIME TO TIME OR BECAUSE OF EXTREME'S REQUEST FOR BNPLC'S CONSENT OR APPROVAL TO
AN ADJUSTMENT.]

     This conveyance is subject to all encumbrances not constituting a "Lien
Removable by BNPLC" (as defined in the Common Definitions and Provisions
Agreement (Land) incorporated by reference into the Lease Agreement (Land)
referenced in the last item of the list below), including the following matters
to the extent the same are still valid and in force:

1.   TAXES for the fiscal year 2000-2001, a lien not yet due or payable.

2.   The lien of supplemental taxes, if any, assessed pursuant to the provisions
     of Chapter 3.5, (commencing with Section 75) to the Revenue and Taxation
     Code of the State of California.

3.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara
     For:      electric wire overhang purposes
     Recorded:      November 28, 1960 in Book 4995, Page 160, Official Records
     Affects: Northerly 5 feet of said land, and as shown on the survey prepared
                    by Anthony C. McCants, L.S. 5944, dated April 27, 2000,
                    revised May 22, 2000

4.   The fact that the ownership of said land does not include any right of
     ingress or egress to or from Lawrence Expressway contiguous thereto, said
     right having been relinquished by deed,
     From:     Jefferson Union Elementary School District of the County of Santa
               Clara
     To:       County of Santa Clara, State of California
     Recorded:      June 4, 1965 in Book 6982, Page 1, Official Records

     Said land, however, abuts on a public street other than the one referred to
     above, over which rights of vehicular access have not been relinquished.

5.   An Agreement, affecting said land, for the purposes stated herein and
     subject to the terms, covenants, conditions, restrictions, and easements,
     if any, contained therein
     For:      Postponed Traffic Signal Improvements
     Dated:    October 4, 1983
     Executed by:   City of Santa Clara, California, a municipal corporation
                    and MPJ, a California partnership
     Recorded:      November 16, 1983 in Book I 070, Page 333, Official Records.

6.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara, a municipal corporation
     For:      roadway purposes and public utilities
     Recorded:      November 30, 1983 in Book I 111, Page 606, Official Records
     Affects:A portion of that certain 24.740 acre parcel of land as shown on
                    that certain Record of Survey filed for record in Book 447
                    of Maps, at page 33, Santa Clara County Records, described
                    as

[Land]                       Exhibit B-1 - Page 5
<PAGE>

                    follows:

     Beginning at a point in the Northerly line of Monroe Avenue, as shown on
     said map at the Westerly terminus of the course shown as N. 89 degrees 25
     minutes 00 seconds E. 760.70; thence from said point of beginning along
     said Northerly line N. 89 degrees 25 minutes 00 seconds E. 760.70 feet and
     N. 2.00 feet; thence leaving said Northerly line along a line parallel with
     said course of N. 89 degrees 25 minutes 00 seconds E.; S. 89 degrees 25
     minutes 00 seconds W. 334.99 feet; thence leaving said parallel line N. 87
     degrees 09 minutes 00 seconds W. 66.79 feet; thence along a line parallel
     with said course N. 89 degrees 25 minutes 00 seconds E.; S. 89 degrees 25
     minutes 00 seconds W. 359.00 feet; thence leaving said Westerly line along
     a tangent curve to the right, with a radius of 50.00 feet, through a
     central angle of 90 degrees 34 minutes 33 seconds for an arc length of
     79.04 feet to a point of cusp in the Westerly line of said 24.740 acre
     parcel; thence along said Westerly line S. 0 degrees 00 minutes 27 seconds
     E. 6.00 feet; thence leaving said Westerly line along a tangent curve to
     the left, with a radius of 50.00 feet, through a central angle of 90
     degrees 34 minutes 33 seconds for an arc length of 79.04 feet to the point
     of beginning, and as shown on the survey prepared by Anthony C. McCants,
     L.S. 5944, dated April 27, 2000, revised May 22, 2000.

7.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara, a municipal corporation
     For:      underground electrical distribution and/or communication systems
     Recorded:      May 17, 1984 in Book I 552, Page 595, Official Records
     Affects. as follows:

     Parcel 1:

     Commencing at the point of intersection of the Westerly line of that
     certain 24.74 acre parcel of land shown upon that Record of Survey filed
     for recorded August 10, 1979 in Book 447 of Maps, at page 33, Santa Clara
     County Records, with a line parallel with and 10 feet Southerly of,
     measured at right angles to, the Northerly line of said parcel; thence
     along said parallel line N. 89 degrees 25 minutes 00 seconds E. 107.00
     feet; thence parallel with said Westerly line S. 0 degrees 00 minutes 27
     seconds E. 319.16 feet; thence S. 34 degrees 02 minutes 45 seconds W. 87.51
     feet, more or less, to intersection with a line parallel with and 58 feet
     Easterly of measured at right angles to, said Westerly line; thence along
     last said parallel line S. 0 degrees 00 minutes 27 seconds E. 294.30 feet,
     more or less, to intersection with a line parallel with and 5 feet
     Northerly of, measured at right angles to, the Northerly line of that real
     property conveyed to the City of Santa Clara by that deed filed for record
     November 30, 1983 in Book I 111 of Official Records, at page 606, said
     County Records; thence along last said parallel line the following three
     (3) courses: N. 89 degrees 25 minutes 00 seconds E. 351.81 feet; S. 87
     degrees 09 minutes 00 seconds E. 66.79 feet; N. 89 degrees 25 minutes 00
     seconds E. 334.69 feet; thence continuing parallel with the Southerly line
     of first said parcel N. 89 degrees 25 minutes 00 seconds E. 181.89 feet,
     more or less, to termination in the Easterly line of that certain parcel of
     real property conveyed to MPJ Partnership, by that Grant Deed filed for
     record August 25, 1983 in Book H 838 of Official Records, at page 215, said
     County Records.

     Parcel 2:

     A portion of said 24.74 acre parcel of land contiguous to and Northerly of
     said real property conveyed by deed recorded in Book I 111, at page 606,
     contiguous to and Westerly of hereinabove described strip of land and
     bounded on the North by a line parallel with and 5 feet Northerly of,
     measured at right angles to, that course N. 89 degrees 25 minutes 00
     seconds E. 351.81 feet in the hereinabove described centerline.

     Parcel 3:

[Land]                       Exhibit B-1 - Page 6
<PAGE>

     A strip of land 10 feet in width and 30 feet in length of centerline of
     said strip being parallel with and 325.5 feet Southerly of, measured at
     right angles to, said Northerly line of the 24.74 acre parcel and
     terminating on the West in the Easterly line of first hereinabove described
     strip; thence continuing Easterly along last said parallel line for a
     distance of 15 feet, as the centerline of a strip of land 15 feet in width,
     to termination of said centerline and strip.

     Parcel 4:

     A strip of land 10 feet in width and 12 feet in length the centerline of
     said strip being parallel with and 116.5 feet Southerly of, measured at
     right angles to, said Northerly line of the 24.74 acre parcel and
     terminating on the West in the Easterly line of first hereinabove described
     strip; thence continuing Easterly along last said parallel line for a
     distance of 15 feet in width, lying 5 feet Northerly and 10 feet Southerly
     of said parallel line to the Easterly terminus of said strip.

     Parcel 5:

     A strip of land 10 feet in width, the centerline of said strip being
     described as follows:

     Commencing at the point of intersection of the Northerly line of first
     hereinabove described strip of land with a line parallel with and 824.5
     feet Easterly of, measured at right angles to, that course in the Westerly
     boundary of said 24.75 acre parcel bearing N. 0 degrees 00 minutes 27
     seconds W.; thence along last said parallel line N. 0 degrees 00 minutes 27
     seconds W. 367.96 feet, more or less, to a line parallel with and 327 feet
     Southerly of, measured at right angles to, said Northerly line of the 24.74
     acre parcel; thence along last said parallel line S. 89 degrees 25 minutes
     00 seconds W. 78 feet to a line parallel with and 746.5 feet Easterly of,
     measured at right angles to, said Westerly line of the 24.74 acre parcel;
     thence along last said parallel line N. 0 degrees 00 minutes 27 seconds W.
     203 feet; thence continuing as the centerline of a strip of land 15 feet in
     width N. 0 degrees 00 minutes 27 seconds W. 15 feet, more or less, to
     termination of said strip and centerline in a line parallel with and 109
     feet Southerly of, measured at right angles to, last said Northerly line.

     Parcel 6:

     A 15 foot square parcel of land contiguous to and Southerly of last
     hereinabove described 10 foot wide strip of land and centered on the
     Southerly prolongation of hereinabove mentioned course N. 0 degrees 00
     minutes 27 seconds W. 203 feet, and as shown on the survey prepared by
     Anthony C. McCants, L.S. 5944, dated April 27, 2000, revised May 22, 2000.

8.   Lease Agreement (Land) dated as of June 1, 2000, by and between BNP Leasing
     Corporation, as lessor, and Extreme Networks, Inc., as lessee, and Lease
     Agreement (Improvements) dated as of June 1, 2000, by and between BNP
     Leasing Corporation, as lessor, and Extreme Networks, Inc., as lessee.

[Land]

                             Exhibit B-1 - Page 7
<PAGE>

                                  Exhibit B-2
                                  -----------

                            CORPORATION GRANT DEED


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
-------------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:  _______________________________
ATTN:     _______________________________
CITY:     _______________________________
STATE:_______________________________
Zip:      _______________________________

MAIL TAX STATEMENTS TO:
----------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:  _______________________________
ATTN:     _______________________________
CITY:     _______________________________
STATE:_______________________________
Zip:      _______________________________

                            CORPORATION GRANT DEED
             (Covering Land but not the Improvements On the Land)

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, BNP
LEASING CORPORATION, a Delaware corporation ("Grantor"), hereby grants to
[Extreme or the Applicable Purchaser] ("Grantee") all of Grantor's interest in
the land situated in Santa Clara, California, described on Annex A attached
hereto and hereby made a part hereof (the "Land"), together with the any other
right, title and interest of Grantor in and to any easements, rights-of-way,
privileges and other rights appurtenant to the Land; provided, however, that
this grant is subject to the encumbrances described on Annex B (the "Permitted
Encumbrances") and any reservations or qualifications set forth below. Grantee
hereby assumes the obligations (including any personal obligations) of Grantor,
if any, created by or under, and agrees to be bound by the terms and conditions
of, the Permitted Encumbrances to the extent that the same concern or apply to
the Land.

Although this deed conveys Grantor's interest in the Land itself, this deed does
not convey any interest in any buildings or other improvements on the Land
(collectively, "Improvements") or any rights or easements appurtenant to
Improvements. Grantor retains and reserves all right, title and interest of
Grantor in and to Improvements and any rights and easements appurtenant to
Improvements, together with a leasehold estate in and to the Land and any rights
and easements appurtenant to the Land, which leasehold estate will permit the
construction, maintenance and use of Improvements by Grantor and Grantor's
successors and assigns on and subject to the terms and conditions set forth in
the Ground Lease dated of even date herewith, executed by Grantee, as lessor,
and Grantor, as lessee. Reference is made to such Ground Lease, all the terms
and conditions of which are incorporated into this deed as if set forth herein.

[Land]

                             Exhibit B-2 - Page 2
<PAGE>

                                             BNP LEASING CORPORATING

Date: As of __________                       By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

                                             [Extreme or Applicable Purchaser]

Date: As of __________                       By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

STATE OF _____________   )
                         )    SS
COUNTY OF ____________   )


     On ___________________ before me,_________, personally appeared________
and___________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.


     Signature____________________


[Land]

                             Exhibit B-2 - Page 2
<PAGE>

STATE OF ____________      )
                           )  SS
COUNTY OF ___________      )


     On ___________________ before me,_________ , personally appeared________
and____________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.



     Signature_______________________

[Land]

                             Exhibit B-2 - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION


[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
---------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DEED TO WHICH THIS DESCRIPTION IS ATTACHED IS
ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

[Land]

                             Exhibit B-2 - Page 4
<PAGE>

                                    Annex B

                            Permitted Encumbrances

[DRAFTING NOTE: TO THE EXTENT THAT ENCUMBRANCES (OTHER THAN "LIENS REMOVABLE BY
---------------
BNPLC") ARE IDENTIFIED IN ADDITION TO THOSE DESCRIBED BELOW, SUCH ADDITIONAL
ENCUMBRANCES WILL BE ADDED TO THE LIST BELOW AND THIS "DRAFTING NOTE" WILL BE
DELETED BEFORE THIS DEED IS ACTUALLY EXECUTED AND DELIVERED BY BNPLC. SUCH
ADDITIONAL ENCUMBRANCES WOULD INCLUDE ANY NEW ENCUMBRANCES APPROVED BY BNPLC AS
"PERMITTED ENCUMBRANCES" UNDER THE LAND LEASE OR THE OTHER LEASE AGREEMENT FROM
TIME TO TIME OR BECAUSE OF EXTREME'S REQUEST FOR BNPLC'S CONSENT OR APPROVAL TO
AN ADJUSTMENT.]

     This conveyance is subject to all encumbrances not constituting a "Lien
Removable by BNPLC" (as defined in the Common Definitions and Provisions
Agreement (Land) incorporated by reference into the Lease Agreement (Land)
referenced in the last item of the list below), including the following matters
to the extent the same are still valid and in force:

1.   TAXES for the fiscal year 2000-2001, a lien not yet due or payable.

2.   The lien of supplemental taxes, if any, assessed pursuant to the provisions
     of Chapter 3.5, (commencing with Section 75) to the Revenue and Taxation
     Code of the State of California.

3.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara
     For:      electric wire overhang purposes
     Recorded:      November 28, 1960 in Book 4995, Page 160, Official Records
     Affects: Northerly 5 feet of said land, and as shown on the survey prepared
                    by Anthony C. McCants, L.S. 5944, dated April 27, 2000,
                    revised May 22, 2000

4.   The fact that the ownership of said land does not include any right of
     ingress or egress to or from Lawrence Expressway contiguous thereto, said
     right having been relinquished by deed,
     From:     Jefferson Union Elementary School District of the County of Santa
               Clara
     To:       County of Santa Clara, State of California
     Recorded:      June 4, 1965 in Book 6982, Page 1, Official Records

     Said land, however, abuts on a public street other than the one referred to
     above, over which rights of vehicular access have not been relinquished.

5.   An Agreement, affecting said land, for the purposes stated herein and
     subject to the terms, covenants, conditions, restrictions, and easements,
     if any, contained therein
     For:     Postponed Traffic Signal Improvements
     Dated:   October 4, 1983
     Executed by: City of Santa Clara, California, a municipal corporation and
                  MPJ, a California partnership
     Recorded:    November 16, 1983 in Book I 070, Page 333, Official Records.

6.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara, a municipal corporation
     For:   roadway purposes and public utilities
     Recorded:      November 30, 1983 in Book I 111, Page 606, Official Records
     Affects: A portion of that certain 24.740 acre parcel of land as shown on
                    that certain Record of Survey filed for record in Book 447
                    of Maps, at page 33, Santa Clara County Records, described
                    as

[Land]

                             Exhibit B-2 - Page 5
<PAGE>

                    follows:

     Beginning at a point in the Northerly line of Monroe Avenue, as shown on
     said map at the Westerly terminus of the course shown as N. 89 degrees 25
     minutes 00 seconds E. 760.70; thence from said point of beginning along
     said Northerly line N. 89 degrees 25 minutes 00 seconds E. 760.70 feet and
     N. 2.00 feet; thence leaving said Northerly line along a line parallel with
     said course of N. 89 degrees 25 minutes 00 seconds E.; S. 89 degrees 25
     minutes 00 seconds W. 334.99 feet; thence leaving said parallel line N. 87
     degrees 09 minutes 00 seconds W. 66.79 feet; thence along a line parallel
     with said course N. 89 degrees 25 minutes 00 seconds E.; S. 89 degrees 25
     minutes 00 seconds W. 359.00 feet; thence leaving said Westerly line along
     a tangent curve to the right, with a radius of 50.00 feet, through a
     central angle of 90 degrees 34 minutes 33 seconds for an arc length of
     79.04 feet to a point of cusp in the Westerly line of said 24.740 acre
     parcel; thence along said Westerly line S. 0 degrees 00 minutes 27 seconds
     E. 6.00 feet; thence leaving said Westerly line along a tangent curve to
     the left, with a radius of 50.00 feet, through a central angle of 90
     degrees 34 minutes 33 seconds for an arc length of 79.04 feet to the point
     of beginning, and as shown on the survey prepared by Anthony C. McCants,
     L.S. 5944, dated April 27, 2000, revised May 22, 2000.

7.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara, a municipal corporation
     For:   underground electrical distribution and/or communication systems
     Recorded:      May 17, 1984 in Book I 552, Page 595, Official Records
     Affects. as follows:

     Parcel 1:

     Commencing at the point of intersection of the Westerly line of that
     certain 24.74 acre parcel of land shown upon that Record of Survey filed
     for recorded August 10, 1979 in Book 447 of Maps, at page 33, Santa Clara
     County Records, with a line parallel with and 10 feet Southerly of,
     measured at right angles to, the Northerly line of said parcel; thence
     along said parallel line N. 89 degrees 25 minutes 00 seconds E. 107.00
     feet; thence parallel with said Westerly line S. 0 degrees 00 minutes 27
     seconds E. 319.16 feet; thence S. 34 degrees 02 minutes 45 seconds W. 87.51
     feet, more or less, to intersection with a line parallel with and 58 feet
     Easterly of measured at right angles to, said Westerly line; thence along
     last said parallel line S. 0 degrees 00 minutes 27 seconds E. 294.30 feet,
     more or less, to intersection with a line parallel with and 5 feet
     Northerly of, measured at right angles to, the Northerly line of that real
     property conveyed to the City of Santa Clara by that deed filed for record
     November 30, 1983 in Book I 111 of Official Records, at page 606, said
     County Records; thence along last said parallel line the following three
     (3) courses: N. 89 degrees 25 minutes 00 seconds E. 351.81 feet; S. 87
     degrees 09 minutes 00 seconds E. 66.79 feet; N. 89 degrees 25 minutes 00
     seconds E. 334.69 feet; thence continuing parallel with the Southerly line
     of first said parcel N. 89 degrees 25 minutes 00 seconds E. 181.89 feet,
     more or less, to termination in the Easterly line of that certain parcel of
     real property conveyed to MPJ Partnership, by that Grant Deed filed for
     record August 25, 1983 in Book H 838 of Official Records, at page 215, said
     County Records.

     Parcel 2:

     A portion of said 24.74 acre parcel of land contiguous to and Northerly of
     said real property conveyed by deed recorded in Book I 111, at page 606,
     contiguous to and Westerly of hereinabove described strip of land and
     bounded on the North by a line parallel with and 5 feet Northerly of,
     measured at right angles to, that course N. 89 degrees 25 minutes 00
     seconds E. 351.81 feet in the hereinabove described centerline.

     Parcel 3:

[Land]

                             Exhibit B-2 - Page 6
<PAGE>

     A strip of land 10 feet in width and 30 feet in length of centerline of
     said strip being parallel with and 325.5 feet Southerly of, measured at
     right angles to, said Northerly line of the 24.74 acre parcel and
     terminating on the West in the Easterly line of first hereinabove described
     strip; thence continuing Easterly along last said parallel line for a
     distance of 15 feet, as the centerline of a strip of land 15 feet in width,
     to termination of said centerline and strip.

     Parcel 4:

     A strip of land 10 feet in width and 12 feet in length the centerline of
     said strip being parallel with and 116.5 feet Southerly of, measured at
     right angles to, said Northerly line of the 24.74 acre parcel and
     terminating on the West in the Easterly line of first hereinabove described
     strip; thence continuing Easterly along last said parallel line for a
     distance of 15 feet in width, lying 5 feet Northerly and 10 feet Southerly
     of said parallel line to the Easterly terminus of said strip.

     Parcel 5:

     A strip of land 10 feet in width, the centerline of said strip being
     described as follows:

     Commencing at the point of intersection of the Northerly line of first
     hereinabove described strip of land with a line parallel with and 824.5
     feet Easterly of, measured at right angles to, that course in the Westerly
     boundary of said 24.75 acre parcel bearing N. 0 degrees 00 minutes 27
     seconds W.; thence along last said parallel line N. 0 degrees 00 minutes 27
     seconds W. 367.96 feet, more or less, to a line parallel with and 327 feet
     Southerly of, measured at right angles to, said Northerly line of the 24.74
     acre parcel; thence along last said parallel line S. 89 degrees 25 minutes
     00 seconds W. 78 feet to a line parallel with and 746.5 feet Easterly of,
     measured at right angles to, said Westerly line of the 24.74 acre parcel;
     thence along last said parallel line N. 0 degrees 00 minutes 27 seconds W.
     203 feet; thence continuing as the centerline of a strip of land 15 feet in
     width N. 0 degrees 00 minutes 27 seconds W. 15 feet, more or less, to
     termination of said strip and centerline in a line parallel with and 109
     feet Southerly of, measured at right angles to, last said Northerly line.

     Parcel 6:

     A 15 foot square parcel of land contiguous to and Southerly of last
     hereinabove described 10 foot wide strip of land and centered on the
     Southerly prolongation of hereinabove mentioned course N. 0 degrees 00
     minutes 27 seconds W. 203 feet, and as shown on the survey prepared by
     Anthony C. McCants, L.S. 5944, dated April 27, 2000, revised May 22, 2000.

8.   Lease Agreement (Land) dated as of June 1, 2000, by and between BNP Leasing
     Corporation, as lessor, and Extreme Networks, Inc., as lessee, and Lease
     Agreement (Improvements) dated as of June 1, by and between BNP Leasing
     Corporation, as lessor, and Extreme Networks, Inc., as lessee.

[Land]

                             Exhibit B-2 - Page 7
<PAGE>

                                  Exhibit B-3
                                  -----------

                                 GROUND LEASE

     This GROUND LEASE (this "Ground Lease"), by and between BNP LEASING
CORPORATION, a Delaware corporation ("BNPLC"), whose address is 12201 Merit
Drive, Suite 860,Dallas, Texas 75251, and [Extreme or the Applicable Purchaser],
a ___________ ("Lessor"), whose address is ____________________. as of
____________, ____ (the "GL Effective Date").

                                   RECITALS

     This Ground Lease is being executed pursuant to a Purchase Agreement (Land)
dated as of June 1, 2000 (the "Purchase Agreement"), between BNP Leasing
Corporation and Extreme Networks, Inc., covering the land described in Annex 1
                                                                       -------
attached hereto (the "Land"). Incorporated by reference into the Purchase
Agreement is a Common Definitions and Provisions Agreement (Land) dated as of
the effective date of the Purchase Agreement (the "CDPA"), between BNP Leasing
Corporation and Extreme Networks, Inc. The CDPA is hereby incorporated into and
made a part of this Ground Lease for all purposes. Capitalized terms defined in
the CDPA and used but not otherwise defined herein are intended in this Ground
Lease to have the respective meanings ascribed to them in the CDPA. The
provisions in Article II of the CDPA are intended to apply to this Ground Lease
as if set forth herein and as if this Ground Lease were one of the "Operative
Documents" as defined therein.

     Lessor and BNPLC have reached agreement as to the terms and conditions upon
which Lessor is willing to lease the Land described in Annex 1 to BNPLC for a
                                                       -------
term of approximately just less that 35 years, and by this Ground Lease Lessor
and BNPLC desire to evidence such agreement.

                               GRANTING CLAUSES

     NOW, THEREFORE, in consideration of the rent to be paid and the covenants
and agreements to be performed by BNPLC, as hereinafter set forth, Lessor does
hereby LEASE, DEMISE and LET unto BNPLC for the term hereinafter set forth the
Land, together with:

          (1   all easements and rights-of-way now owned or hereafter acquired
     by Lessor for use in connection with the Land or as a means of access
     thereto; and

          (2   all right, title and interest of Lessor, now owned or hereafter
     acquired, in and to (A) any land lying within the right-of-way of any
     street, open or proposed, adjoining the Land, (B) any and all sidewalks and
     alleys adjacent to the Land and (C) any strips and gores between the Land
     and any abutting land not owned by Lessor.

The Land and all of the property described in the preceding clauses (1) and (2)
are hereinafter referred to collectively as the "Real Property".

     To the extent, but only to the extent, that assignable rights or interests
in, to or under the following have been or will be acquired by Lessor as the
owner of any interest in the Real Property, Lessor also hereby grants and
assigns to BNPLC for the term of this Ground Lease (and thereafter, if BNPLC
purchases the Real Property from

[Land]
<PAGE>

Lessor pursuant to the Repurchase Option described in Paragraph 12) the right to
use and enjoy (and, in the case of contract rights, to enforce) such rights or
interests of Lessor:

          (a)  the Permitted Encumbrances; and

          (b)  any general intangibles, permits, licenses, franchises,
     certificates, and other rights and privileges related to the Real Property
     that BNPLC (rather than Lessor) would have acquired if BNPLC had itself
     acquired the fee estate in the Real Property (excluding, however, any
     rights and privileges of Lessor under this Ground Lease, any rights or
     privileges of Lessor under the Purchase Agreement or other Operative
     Documents, and [without limiting Lessor's obligations under subparagraphs
     4.(B), 6.(B) or 6.(C)] any rights and privileges of Lessor under the
     Development Documents described in Annex 3).
                                        -------

Such rights and interests of Lessor, whether now existing or hereafter arising,
are hereinafter collectively called the "GL Personal Property". The Real
Property and the GL Personal Property are hereinafter sometimes collectively
called the "GL Property."

     Provided, however, the leasehold estate conveyed hereby and BNPLC's rights
hereunder are expressly made subject and subordinate to the Permitted
Encumbrances, including those listed on Annex 2. FURTHER, IF AND SO LONG AS THE
                                        -------
OTHER LEASE AGREEMENT AND THE OTHER PURCHASE AGREEMENT (BOTH AS DEFINED IN THE
-     -     -                 -     -        -
CDPA) REMAIN IN FORCE, THE RIGHTS AND OBLIGATIONS OF LESSOR AND BNPLC HEREUNDER
----                                                 -          -----
SHALL BE SUBJECT TO ANY CONTRARY PROVISIONS THEREIN. ACCORDINGLY, BNPLC'S RIGHTS
                                                                  -----
UNDER PARAGRAPH 7 BELOW SHALL BE SUBJECT TO THE PROVISIONS GOVERNING INSURANCE
AND CONDEMNATION IN THE OTHER LEASE AGREEMENT, IF AND SO LONG AS THE OTHER LEASE
                        -     -     -                                -     -
AGREEMENT REMAINS IN FORCE.
-

                         GENERAL TERMS AND CONDITIONS

     The GL Property is leased by Lessor to BNPLC and is accepted and is to be
used and possessed by BNPLC upon and subject to the following terms and
conditions:

     1.   Ground Lease Term and Early Termination by BNPLC. The term of this
Ground Lease (the "Ground Lease Term") shall commence on and include the GL
Effective Date and end on last Business Day prior to the thirty-fifth
anniversary of the GL Effective Date. However, subject to the prior approval of
any Leasehold Mortgagee, BNPLC shall have the right to terminate this Ground
Lease by giving a notice to Lessor stating that BNPLC unequivocally elects to
terminate effective as of a date specified in such notice, which may be any date
more than thirty days after the notice and after the expiration or termination
of the Lease pursuant to its terms.

     2.   No Other Ground Lease Termination. Except as expressly provided
herein, this Ground Lease shall not terminate, nor shall Lessor have any right
to terminate this Ground Lease, nor shall the obligations of Lessor under this
Ground Lease be excused, for any reason whatsoever, including any of the
following: (i) any damage to or the destruction of all or any part of the GL
Property from whatever cause, (ii) the taking of the GL Property or any portion
thereof by eminent domain or otherwise for any reason, (iii) any default on the
part of BNPLC under this Ground Lease or under any other agreement to which
Lessor and BNPLC are parties, or (iv) any other cause whether similar or
dissimilar to the foregoing, any existing or future law to the contrary
notwithstanding. It is the intention of the parties hereto that the obligations
of Lessor hereunder shall be separate and independent of the covenants and
agreements of BNPLC. However, nothing in this Paragraph shall be construed as a
waiver by Lessor of any right Lessor may have at law or in equity to recover
monetary damages for any default under this Ground Lease by BNPLC.

[Land]

                             Exhibit B-3 - Page 2
<PAGE>

     3.   Ground Lease Rent. On each anniversary of the GL Effective Date,
BNPLC shall make a payment to Lessor of rent for the then preceding year
("Ground Lease Rent"), in currency that at the time of payment is legal tender
for public and private debts in the United States of America. Each such payment
of Ground Lease Rent shall equal the Fair Rental Value, determined as provided
in Annex 4.
   -------

     4.   Use of GL Property.

          (A0  Permitted Uses and Construction of Improvements. Subject
               -----------------------------------------------
to the Permitted Encumbrances and the terms hereof, BNPLC may use and occupy the
GL Property for any purpose permitted by Applicable Laws and may construct,
maintain and use any Improvements on the Land which are permitted by Applicable
Laws.

          (B0  Cooperation by Lessor and its Affiliates.
               ----------------------------------------

          (1   After the expiration or any earlier termination of the Lease, if
     a use of the GL Property by BNPLC or any new Improvements or any removal or
     modification of Improvements proposed by BNPLC would violate any Permitted
     Encumbrance, Development Document or Applicable Law unless Lessor or any of
     its Affiliates, as an owner of adjacent property or otherwise, gave its
     consent or approval thereto or agreed to join in a modification of a
     Permitted Encumbrance or Development Document, then Lessor shall give and
     cause its Affiliates to give such consent or approval or join in such
     modification.

          (2   To the extent, if any, that any Permitted Encumbrance,
     Development Document or Applicable Law requires the consent or approval of
     Lessor or any of its Affiliates or of the City of Santa Clara or any other
     Person to an assignment of this Ground Lease or a transfer of any interest
     in the GL Property by BNPLC or its successors or assigns, Lessor will
     without charge give and cause its Affiliates to give such consent or
     approval and will cooperate in any way reasonably requested by BNPLC to
     assist BNPLC to obtain such consent or approval from the City or any other
     Person; provided, however, the assignment or transfer is not then
     prohibited by the Lease.

          (3   Lessor's obligations under this subparagraph 4.(B) shall be
     binding upon any successor or assign of Lessor with respect to the Land and
     other properties encumbered by the Permitted Encumbrances or subject to the
     Development Documents, and such obligations shall survive any sale of
     Lessor's interest in the GL Property to BNPLC because of BNPLC's exercise
     of the Repurchase Option (as defined in Paragraph 12).

          (C0  Title to Improvements. Any and all Improvements of whatever
               ---------------------
nature at any time constructed, placed or maintained upon any part of the Land
shall be and remain the property of BNPLC and BNPLC's sublessee's, assignees,
licensees and concessionaires, as their interests may appear; provided, any such
Improvements which remain on the Land when this Ground Lease expires or is
terminated shall become and thereupon be the property of Lessor, free and clear
of any Liens Removable by BNPLC. It is the intention of Lessor and BNPLC that
severance of fee title to the Land and the Improvements shall not change the
character of the Improvements as real property. BNPLC may at any time after
Lessor ceases to have possession of the GL Property as tenant under the Lease
and prior to the expiration or termination of this Ground Lease remove all or
any Improvements from the Land without the consent of Lessor and without any
obligation to Lessor or its Affiliates to provide compensation or to construct
other Improvements on or about the Land.

     5.   Assignment and Subletting; Pass Through of BNPLC'S Liability
Insurance and Indemnity Rights. BNPLC may sublet or assign this Ground Lease
without the consent of Lessor or any of its Affiliates, subject only to
limitations set forth in the Lease for the benefit of Lessor so long as those
limitations

[Land]

                             Exhibit B-3 - Page 3
<PAGE>

remain in force.

     To the extent that BNPLC may from time to time after the expiration or
earlier termination of the Other Lease Agreement require any subtenant to agree
to maintain liability insurance against claims of third parties and agree to
make BNPLC an additional or named insured under such insurance, BNPLC shall also
require the subtenant to agree to make Lessor an additional or named insured.
However, BNPLC shall have no liability to Lessor for a breach by the subtenant
of any such agreements, and to the extent that BNPLC's rights as an additional
or named insured are subject to exceptions or limitations concerning BNPLC's own
acts or omissions or the acts or omissions of anyone other than the subtenant,
so too may Lessor's rights as an additional or named insured be subject to
exceptions or limitations concerning Lessor's own acts or omissions or the acts
or omissions of anyone other than the subtenant.

     To the extent that BNPLC may itself from time to time after the expiration
or earlier termination of the Other Lease Agreement maintain liability insurance
against claims of third parties which may arise because of any occurrence on or
alleged to have occurred on or about the GL Property, BNPLC shall cause Lessor
to be an additional or named insured under such insurance, provided Lessor pays
or reimburses BNPLC for any additional insurance premium required to have Lessor
made an insured.

     To the extent that BNPLC may from time to time after the expiration or
earlier termination of the Other Lease Agreement require any subtenant to agree
to indemnify BNPLC against Environmental Losses or other Losses concerning the
GL Property, BNPLC shall also require the subtenant to agree to indemnify
Lessor. However, BNPLC shall have no liability to Lessor for a breach by the
subtenant of any such agreement, and to the extent that BNPLC's rights as an
indemnitee of the subtenant are subject to exceptions or limitations concerning
BNPLC's own acts or omissions or the acts or omissions of anyone other than the
subtenant, so too may Lessor's rights as an indemnitee be subject to exceptions
or limitations concerning Lessor's own acts or omissions or the acts or
omissions of anyone other than the subtenant.

     6.   Representations, Warranties and Covenants of Lessor Concerning the
Property. Lessor represents, warrants and covenants as follows:

          (A0  Title to the Property. This Ground Lease shall vest in BNPLC good
               ---------------------
and marketable title to a leasehold estate in the Land, subject only to the
terms and conditions hereof, the Permitted Encumbrances, the Development
Documents and any Liens Removable by BNPLC. Lessor shall not, without the prior
consent of BNPLC, create, place or authorize, or through any act or failure to
act, acquiesce in the placing of, any deed of trust, mortgage or other Lien,
whether statutory, constitutional or contractual against or covering the GL
Property or any part thereof (other than Permitted Encumbrances and Liens
Removable by BNPLC), regardless of whether the same are expressly or otherwise
subordinate to the Operative Documents or BNPLC's interest in the Property.

          (B0  Modification of Permitted Encumbrances and Development Documents.
               ----------------------------------------------------------------
Without the prior consent of BNPLC, Lessor shall not enter into, initiate,
approve or consent to any modification of any Permitted Encumbrance or
Development Document that would create or expand or purport to create or expand
obligations or restrictions which would encumber the GL Property or any
improvements constructed thereon.

          (C0  Performance and Preservation of the Development Documents and
               -------------------------------------------------------------
Permitted Encumbrances for the Benefit of BNPLC. Not only during the term of the
-----------------------------------------------
Other Lease Agreement, but thereafter throughout the term of this Ground Lease,
Lessor shall comply with and perform the obligations imposed by the Permitted
Encumbrances and the Development Documents upon Lessor or upon any owner of the
Land, and shall do whatever is required to preserve the rights and benefits
conferred or intended to be conferred by the Permitted Encumbrances and the
Development Documents, as necessary to facilitate any construction contemplated
in the Other Lease Agreement and the use of the Improvements by BNPLC and its
successors, assigns and subtenants under this Ground Lease after the expiration
or any earlier termination of the Other Lease Agreement. Further, if

[Land]

                             Exhibit B-3 - Page 4
<PAGE>

Lessor or any Affiliate of Lessor now or hereafter owns, acquires or leases land
(other than the Land) that is the subject of a Permitted Encumbrance or
Development Document, then Lessor shall, and shall cause its Affiliate to,
assume liability for and indemnify BNPLC and other Interested Parties and defend
and hold them harmless from and against all Losses (including Losses caused by
any decline in the value of the Property or of the Improvements) that they would
not have incurred or suffered but for (i) a termination of such Permitted
Encumbrance or Development Document, to which Lessor or its Affiliate agreed, or
which resulted from a breach thereof by Lessor or its Affiliate, or (ii) a
refusal of Lessor or its Affiliate to agree to any waiver or modification
requested by BNPLC of restrictions upon the Property or the transfer thereof
imposed by such Permitted Encumbrance or Development Document, or (iii) anything
done, authorized or suffered by Lessor or its Affiliate in violation of such
Permitted Encumbrance or Development Document. Lessor's obligations under this
subparagraph 6.(C) shall be binding upon any successor or assign of Lessor or
its Affiliates with respect to their interest in properties subject to the
Development Documents and Permitted Encumbrances.

          7.   Insurance and Condemnation.

               (A0 Entitlement to Insurance and Condemnation Proceeds. All
                   --------------------------------------------------
insurance and condemnation proceeds payable with respect to any damage to or
taking of the GL Property shall be payable to and become the property of BNPLC;
provided, however, Lessor shall be entitled to receive condemnation proceeds
awarded for the value of Lessor's remainder interest in the Land exclusive of
the Improvements. BNPLC is authorized to take all action necessary on behalf of
both BNPLC and Lessor (as lessor under this Ground Lease) to collect insurance
and condemnation proceeds.

               (B0 Collection of Insurance Proceeds. In the event any of the GL
                   --------------------------------
Property is destroyed or damaged by fire, explosion, windstorm, hail or by any
other casualty against which insurance shall have been required hereunder, (i)
BNPLC may make proof of loss, (ii) each insurance company concerned is hereby
authorized and directed to make payment for such loss directly to BNPLC for
application as required by subparagraph 7.(A), and (iii) BNPLC's consent must be
obtained for any settlement, adjustment or compromise of any claims for loss,
damage or destruction under any policy or policies of insurance.

               (C0 Collection of Condemnation Proceeds. All proceeds of
                   -----------------------------------
condemnation awards or proceeds of sale in lieu of condemnation with respect to
the GL Property and all judgments, decrees and awards for injury or damage to
the GL Property shall be paid to BNPLC and applied as provided in subparagraph
7.(A) above. BNPLC is hereby authorized, in the name of Lessor, to execute and
deliver valid acquittances for, and to appeal from, any such judgment, decree or
award concerning condemnation of any of the GL Property. BNPLC shall not be, in
any event or circumstances, liable or responsible for failure to collect, or to
exercise diligence in the collection of, any such proceeds, judgments, decrees
or awards.

          8.   Leasehold Mortgages.

               (A0  By Leasehold Mortgage BNPLC may encumber BNPLC's leasehold
estate in the GL Property created by this Ground Lease, as well as BNPLC's
rights and interests in buildings, fixtures, equipment and Improvements situated
on the Land and rents, issues, profits, revenues and other income to be derived
by BNPLC therefrom.

               (B0  Any Leasehold Mortgagee or other party, including any
corporation formed by a Leasehold Mortgagee, may become the legal owner of the
leasehold estate created by this Ground Lease, and of the Improvements,
equipment, fixtures and other property assigned as additional security pursuant
to a Leasehold Mortgage, by foreclosure of a Leasehold Mortgage or as a result
of the assignment or conveyance in lieu of foreclosure. Further, any such
Leasehold Mortgagee or other party may itself, after becoming the legal owner
and holder of the leasehold estate created by this Ground Lease, or of any
Improvements, equipment, fixtures and other

                             Exhibit B-3 - Page 5

[Land]
<PAGE>

property assigned as additional security pursuant to a Leasehold Mortgage,
convey or pledge the same without the consent of Lessor.

               (C0  Lessor shall serve notice of any default by BNPLC hereunder
upon any Leasehold Mortgagee. No notice of a default by BNPLC shall be deemed
effective until it is so served. Any Leasehold Mortgagee shall have the right to
correct or cure any such default within the same period of time after receipt of
such notice as is given to BNPLC under this Ground Lease to correct or cure
defaults, plus an additional period of thirty days thereafter. Lessor will
accept performance by any Leasehold Mortgagee of any covenant, condition or
agreement on BNPLC's part to be performed hereunder with the same force and
effect as though performed by BNPLC.

               (D0  If this Ground Lease should terminate by reason of a
disaffirmance or rejection of this Ground Lease by BNPLC or any receiver,
liquidator or trustee for the property of BNPLC, or by any governmental
authority which had taken possession of the business or property of BNPLC by
reason of the insolvency or alleged insolvency of BNPLC, then:

               (1        Lessor shall give notice thereof to each Leasehold
          Mortgagee; and upon request of any Leasehold Mortgagee made within
          sixty days after Lessor has given such notice, Lessor shall enter into
          a new ground lease of the GL Property with such Leasehold Mortgagee
          for the remainder of the Ground Lease Term, at the same Ground Lease
          Rent and on the same terms and conditions as contained in this Ground
          Lease.

               (2        The estate of the Leasehold Mortgagee, as lessee under
          the new lease, shall have priority equal to the estate of BNPLC
          hereunder. That is, there shall be no charge, lien or burden upon the
          GL Property prior to or superior to the estate granted by such new
          lease which was not prior to or superior to the estate of BNPLC under
          this Ground Lease as of the date immediately preceding the termination
          of this Ground Lease.

               (3        Notwithstanding the foregoing, if Lessor shall receive
          requests to enter into a new ground lease from more than one Leasehold
          Mortgagee, Lessor shall be required to enter into only one new ground
          lease, and the new ground lease shall be to the requesting Leasehold
          Mortgagee who holds the highest priority lien or interest in BNPLC's
          leasehold estate in the Land. If the liens or security interests of
          two or more such requesting Leasehold Mortgagees which shared the
          highest priority just prior to the termination of this Ground Lease,
          the new ground lease shall name all such Leasehold Mortgagees as co-
          tenants thereunder.

               (E0  If BNPLC has agreed with any Leasehold Mortgagee that such
Leasehold Mortgagee's consent will be required to any modification or early
termination of this Ground Lease by BNPLC, and if Lessor has been notified of
such agreement, such consent will be required.

               (F0  No Leasehold Mortgagee will assume any liability under this
Ground Lease either by virtue of its Leasehold Mortgage or by any subsequent
receipt or collection of rents or profits generated from the GL Property, unless
and until the Leasehold Mortgagee acquires BNPLC's leasehold estate in the GL
Property at foreclosure or by deed in lieu of foreclosure.

               (G0  Although the foregoing provisions concerning Leasehold
Mortgages and Leasehold Mortgagees will be self operative, Lessor agrees to
include, in addition to the items specified in Paragraph 11, confirmation of the
foregoing in any statement provided to a Leasehold Mortgagee or prospective
Leasehold Mortgagee pursuant to Paragraph 11.

                             Exhibit B-3 - Page 6

[Land]
<PAGE>

          9.   Events of Default.

               (A0  Definition of Ground Lease Default.  Each of the following
                    ----------------------------------
events shall be deemed to be a "Ground Lease Default" by BNPLC under this Ground
Lease:

               (1   BNPLC shall fail to pay when due any installment of Ground
          Lease Rent due hereunder and such failure shall continue for sixty
          days after BNPLC receives notice thereof.

               (2   BNPLC shall fail to comply with any term, provision or
          covenant of this Ground Lease (other than as described in the other
          clauses of this subparagraph 9.(A)), and shall not cure such failure
          prior to the earlier of (A) ninety days after notice thereof is sent
          to BNPLC, or (B) the date any writ or order is issued for the levy or
          sale of any property owned by Lessor or its Affiliates (including the
          GL Property) because of such failure or any criminal action is
          instituted against BNPLC or any of its directors, officers or
          employees because of such failure; provided, however, that so long as
          no such writ or order is issued and no such criminal actions is
          instituted, if such failure is susceptible of cure but cannot with
          reasonable diligence be cured within such ninety day period, and if
          BNPLC shall promptly have commenced to cure the same and shall
          thereafter prosecute the curing thereof with reasonable diligence, the
          period within which such failure may be cured shall be extended for
          such further period as shall be necessary for the curing thereof with
          reasonable diligence.

               (B0  Remedy. Upon the occurrence of a Ground Lease Default which
                    ------
is not cured within any applicable period expressly permitted by subparagraph
9.(A), Lessor's sole and exclusive remedies shall be to sue BNPLC for the
collection of any amount due under this Ground Lease, to sue for the specific
enforcement of BNPLC's obligations hereunder, or to enjoin the continuation of
the Ground Lease Default; provided, however, no limitation of Lessor's remedies
contained herein will prevent Lessor from recovering any reasonable costs Lessor
may incur to mitigate its damages by curing a Ground Lease Default that BNPLC
has failed to cure itself (so long as the cure by Lessor is pursued in a lawful
manner and the costs Lessor seeks to recover do not exceed the actual damages to
be mitigated). Lessor may not terminate this Ground Lease or BNPLC's right to
possession under this Ground Lease. Any judgment which Lessor may obtain against
BNPLC for amounts due under this Ground Lease may be collected only through
resort of a judgement lien against BNPLC's interest in the GL Property and any
Improvements. BNPLC shall have no personal liability for the payment amounts due
under this or for the performance of any obligations of BNPLC under this Ground
Lease.

          10.  Quiet Enjoyment.  Neither Lessor nor any third party lawfully
claiming any right or interest in the GL Property shall during the Ground Lease
Term disturb BNPLC's peaceable and quiet enjoyment of the GL Property; however,
such enjoyment shall be subject to the terms, provisions, covenants, agreements
and conditions of this Ground Lease and the Permitted Encumbrances, to which
this Ground Lease is subject and subordinate as hereinabove set forth.

         11.   Estoppel Certificate.  Lessor shall from time to time, within ten
days after receipt of request by BNPLC, deliver a statement in writing
certifying:

               (A0  that this Ground Lease is unmodified and in full force and
effect (or if modified that this Ground Lease as so modified is in full force
and effect);

               (B0  that to the knowledge of Lessor BNPLC has not previously
assigned or hypothecated its rights or interests under this Ground Lease, except
as is described in such statement with as much specificity as Lessor is able to
provide;

               (C0  the term of this Ground Lease and the Ground Lease Rent
then in effect and any additional

                             Exhibit B-3 - Page 7

[Land]
<PAGE>

charges;

               (D0  that BNPLC is not in default under any provision of this
Ground Lease (or if in default, the nature thereof in detail) and a statement as
to any outstanding obligations on the part of Lessor or BNPLC; and

               (E0  such other matters as are reasonably requested by BNPLC.

Lessor's failure to deliver such statement within such time shall be conclusive
upon BNPLC (i) that this Ground Lease is in full force and effect, without
modification except as may be represented by BNPLC, (ii) that there are no
uncured defaults in BNPLC's performance hereunder.

          12.  Option To Repurchase.  Subject to the terms and conditions set
forth in Annex 5, BNPLC (and any assignee of BNPLC's entire interest in the GL
         -------
Property, but not any subtenant or assignee of a lesser interest) shall have the
option (the "Repurchase Option") to purchase Lessor's interest in the GL
Property. To secure BNPLC's right to recover any damages caused by a breach of
the Repurchase Option or other provisions of this Ground Lease by Lessor,
including any such breach caused by a rejection or termination of this Ground
Lease in any bankruptcy or insolvency proceeding instituted by or against
Lessor, as debtor, Lessor does hereby grant to BNPLC a lien and security
interest against the Land and against all rights, title and interests of Lessor
from time to time in and to the GL Property.

                         [The signature pages follow.]

                             Exhibit B-3 - Page 8

[Land]
<PAGE>

               IN WITNESS WHEREOF, this Ground Lease is hereby executed in
multiple originals as of the date first written above.





                                        "Lessor"

                                        [Extreme or the Applicable Purchaser]



                                        By: ____________________________________
                                               Name: ___________________________
                                               Title: __________________________

                             Exhibit B-3 - Page 9

[Land]
<PAGE>

[Continuation of signature pages to GROUND LEASE dated as of ___________, ____]





                                        "BNPLC"

                                        BNP LEASING CORPORATION




                                        By: ____________________________________
                                               Name: ___________________________
                                               Title: __________________________

                             Exhibit B-3 - Page 10

[Land]
<PAGE>

STATE OF ___________                )
                                    )
COUNTY OF _____________             )

          On _____________, _____, before me, ________________________,
personally appeared ____________________________, personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person whose name
is subscribed to the within instrument and acknowledged to me that he executed
the same in his authorized capacity, and that by his signature on the instrument
the person, or the entity upon behalf of which the person acted, executed the
instrument.

                                        WITNESS my hand and official seal.




                                        Signature ______________________________

                             Exhibit B-3 - Page 11

[Land]
<PAGE>

STATE OF ________                   )
                                    )
COUNTY OF __________                )

          On ___________, _____, before me, ________________________, personally
appeared ____________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument and acknowledged to me that he executed the same in his authorized
capacity, and that by his signature on the instrument the person, or the entity
upon behalf of which the person acted, executed the instrument.

                                        WITNESS my hand and official seal.





                                        Signature ______________________________

                             Exhibit B-3 - Page 12

[Land]
<PAGE>

                                    Annex 1
                                    -------

                               Legal Description

[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
 --------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DEED TO WHICH THIS DESCRIPTION IS ATTACHED IS
ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

                             Exhibit B-3 - Page 13

[Land]
<PAGE>

                                    Annex 2
                                    -------

                            Permitted Encumbrances

The leasehold and other interests in the Land hereby conveyed by Lessor are
conveyed subject to the following matters to the extent the same are still valid
and in force:

[THE SAME LIST OF PERMITTED ENCUMBRANCES ATTACHED TO THE GRANT DEED FROM BNPLC
TO EXTREME OR THE APPLICABLE PURCHASER SHALL BE INSERTED HERE.]

                             Exhibit B-3 - Page 14

[Land]
<PAGE>

                                    Annex 3
                                    -------

                         List of Development Documents

None.

[Land]

                             Exhibit B-3 - Page 15
<PAGE>

                                    Annex 4
                                    -------

                      DETERMINATION OF FAIR RENTAL VALUE

         Each annual payment of Ground Lease Rent will equal the Fair Rental
Value, computed as of the most recent Rental Determination Date when such
payment becomes due. As used in this Annex:

                  "Fair Rental Value" means (and all appraisers and other
         persons involved in the determination of the Fair Rental Value will be
         so advised) the annual rent, as determined in accordance with this
         Annex, that would be agreed upon between a willing tenant, under no
         compulsion to lease, and a willing landlord, under no compulsion to
         lease, for unimproved land comparable in size and location to the Land,
                    ----------
         exclusive of any Improvements but assuming that there is no higher and
         better use for such land than as a site for improvements of comparable
         size and utility to the Improvements, at the time a determination is
         required under hereunder and taking into consideration the condition of
         the Land, the encumbrances affecting the title to the Land and all
         applicable zoning, land use approvals and other governmental permits
         relating to the Land at the time of such determination; and

                  "Rental Determination Date" means the GL Effective Date and
         each fifth anniversary of the GL Effective Date.

         If Lessor and BNPLC have not agreed upon Fair Rental Value as of any
Rental Determination Date within one hundred eighty days after the such date,
then Fair Rental Value will be determined as follows:

                  (a0 Lessor and BNPLC shall each appoint a real estate
         appraiser who is familiar with rental values for properties in the
         vicinity of the Land and who has not previously acted for either party.
         Each party will make the appointment no later than ten days after
         receipt of notice from the other party that the appraisal process
         described in this Annex has been invoked. The agreement of the two
         appraisers as to Fair Rental Value will be binding upon Lessor and
         BNPLC. If the two appraisers cannot agree upon the Fair Rental Value
         within ten days following their appointment, they shall within another
         ten days agree upon a third real estate appraiser. Immediately
         thereafter, each of the first two appraisers will submit his best
         estimate of the appropriate Fair Rental Value (together with a written
         report supporting such estimate) to the third appraiser and the third
         appraiser will choose between the two estimates. The estimate of Fair
         Rental Value chosen by the third appraiser as the closest to the
         prevailing annual fair rental value will be binding upon Lessor and
         BNPLC. Notification in writing of this estimate shall be made to Lessor
         and BNPLC within fifteen days following the selection of the third
         appraiser.

                  (b0 If appraisers must be selected under the procedure set out
         above and either BNPLC or Lessor fails to appoint an appraiser or fails
         to notify the other party of such appointment within fifteen days after
         receipt of notice that the prescribed time for appointing the
         appraisers has passed, then the other party's appraiser will determine
         the Fair Rental Value. All appraisers selected for the appraisal
         process set out in this Annex will be disinterested, reputable,
         qualified real estate appraisers with the designation of MAI or
         equivalent and with at least 5 years experience in appraising
         properties comparable to the Land.

                  (c0 If a third appraiser must be chosen under the procedure
         set out above, he or she will be chosen on the basis of objectivity and
         competence, not on the basis of his relationship with the other
         appraisers or the parties to this Ground Lease, and the first two
         appraisers will be so advised. Although the first two appraisers will
         be instructed to attempt in good faith to agree upon the third
         appraiser, if for any reason they cannot agree within the prescribed
         time, either Lessor and BNPLC may require the first two appraisers to
         immediately submit its top choice for the third appraiser to the then
         highest ranking officer of the California Bar Association who will
         agree to help and who has no attorney/client or other significant

[Land]

                             Exhibit B-3 - Page 16
<PAGE>

         relationship to either Lessor or BNPLC. Such officer will have complete
         discretion to select the most objective and competent third appraiser
         from between the choices of each of the first two appraisers, and will
         do so within twenty days after such choices are submitted to him.

                  (d0 Either Lessor or BNPLC may notify the appraiser selected
         by the other party to demand the submission of an estimate of Fair
         Rental Value or a choice of a third appraiser as required under the
         procedure described above; and if the submission of such an estimate or
         choice is required but the other party's appraiser fails to comply with
         the demand within fifteen days after receipt of such notice, then the
         Fair Rental Value or choice of the third appraiser, as the case may be,
         selected by the other appraiser (i.e., the notifying party's appraiser)
         will be binding upon Lessor and BNPLC.

                  (e0 Lessor and BNPLC shall each bear the expense of the
         appraiser appointed by it, and the expense of the third appraiser and
         of any officer of the California Bar Association who participates in
         the appraisal process described above will be shared equally by Lessor
         and BNPLC.

[Land]

                             Exhibit B-3 - Page 17
<PAGE>

                                    Annex 5
                                    -------

                               REPURCHASE OPTION

         Subject to the terms of this Annex, BNPLC shall have an option (the
"Option") to buy Lessor's fee interest in the GL Property at any time during the
term of this Ground Lease for a purchase price (the "Option Price") to Lessor
equal to the fair market value of the GL Property, determined as described in
the next paragraph.

         For the purposes of this Annex, "fair market value" of the GL Property
means (and all appraisers and other persons involved in the determination of the
Option Price will be so advised) the price that would be agreed upon between a
willing buyer, under no compulsion to buy, and a willing seller, under no
compulsion to sell, for the Land, exclusive of any Improvements as if the Land
were unimproved, but assuming that there is no higher and better use for the
     ----------
Land than as a site for the construction of improvements of comparable size and
utility to the Improvements, at the time of BNPLC's exercise of the Option and
taking into consideration the encumbrances affecting the title to the Land and
all applicable zoning, land use approvals and other governmental permits
relating to the Land at the time of the exercise of the Option.

         If BNPLC exercises the Option, which BNPLC may do by notifying Lessor
that BNPLC has elected to buy Lessor's interest in the GL Property as provided
herein, then:

                  (a0 To the extent, if any, required as a condition imposed by
         law to the conveyance of the fee interest in the GL Property to BNPLC,
         Lessor shall promptly at its expense do whatever is necessary to obtain
         approvals of a new Parcel Map or lot line adjustments.

                  (b0 Upon BNPLC's tender of the Option Price to Lessor, Lessor
         will convey to BNPLC by general warranty deed and assignment, subject
         only to the Permitted Encumbrances, good and marketable title to the
         fee estate in the Land , to Lessor's interest in all other GL Property
         and, to the extent still in force, to Lessor's Extended Remarketing
         Rights under the Purchase Agreement.

                  (c0 BNPLC's obligation to close the purchase shall be subject
         to the following terms and conditions, all of which are for the benefit
         of BNPLC: (1) BNPLC shall have been furnished with evidence
         satisfactory to BNPLC that Lessor can convey title as required by the
         preceding subparagraph; (2) nothing shall have occurred or been
         discovered after BNPLC exercised the Option that could significantly
         and adversely affect title to the GL Property or BNPLC's use thereof,
         (3) all of the representations of Lessor in this Ground Lease shall
         continue to be true as if made effective on the date of the closing
         and, with respect to any such representations which may be limited to
         the knowledge of Lessor or any of Lessor's representatives, would
         continue to be true on the date of the closing if all relevant facts
         and circumstances were known to Lessor and such representatives, (4)
         BNPLC shall find the Option Price acceptable after it is determined as
         provided in this Annex, and (5) BNPLC shall have been tendered the deed
         and other documents which are described in this Annex as documents to
         be delivered to BNPLC at the closing of BNPLC's purchase.

                  (d0 Closing of the purchase will be scheduled on the first
         Business Day following thirty days after the Option Price is
         established in accordance with the terms and conditions of this Annex
         and after any approvals described in subparagraph (a) above are
         obtained, and prior to closing BNPLC's occupancy of the GL Property
         shall continue to be subject to the terms and conditions of this Ground
         Lease, including the terms setting forth BNPLC's obligation to pay
         rent. Closing shall take place at the offices of any title insurance
         company reasonably selected by BNPLC to insure title under the title
         insurance policy described below.

[Land]

                             Exhibit B-3 - Page 18
<PAGE>

                  (e0 Any transfer taxes or notices or registrations required by
         law in connection with the sale contemplated by this Annex will be the
         responsibility of Lessor.

                  (f0 Lessor will deliver a certificate of nonforeign status to
         BNPLC at closing as needed to comply with the provisions of the Foreign
         Investors Real Property Tax Act (FIRPTA) or any comparable federal,
         state or local law in effect at the time.

                  (g0 Lessor will also pay for and deliver to BNPLC at the
         closing an owner's title insurance policy in the full amount of the
         Option Price, issued by a title insurance company designated by BNPLC
         (or written confirmation from the title company that it is then
         prepared to issue such a policy), and subject only to standard printed
         exceptions which the title insurance company refuses to delete or
         modify in a manner acceptable to BNPLC and to Permitted Encumbrances.

                  (h0 Lessor shall also deliver at the closing all other
         documents or things reasonably required to be delivered to BNPLC or by
         the title insurance company to evidence Lessor's ability to transfer
         the GL Property to BNPLC.

         If Lessor and BNPLC do not otherwise agree upon the amount of the
Option Price within twenty days after BNPLC exercises the Option, the Option
Price shall be determined in accordance with the following procedure:

                      (1 Lessor and BNPLC shall each appoint a real estate
                  appraiser who is familiar with properties in the vicinity of
                  the Land and who has not previously acted for either party.
                  Each party will make the appointment no later than ten days
                  after receipt of notice from the other party that the
                  appraisal process described in this Annex has been invoked.
                  The agreement of the two appraisers as to the Option Price
                  will be binding upon Lessor and BNPLC. If the two appraisers
                  cannot agree upon the Option Price within ten days following
                  their appointment, they shall within another ten days agree
                  upon a third real estate appraiser. Immediately thereafter,
                  each of the first two appraisers will submit his best estimate
                  of the appropriate Option Price (together with a written
                  report supporting such estimate) to the third appraiser and
                  the third appraiser will choose between the two estimates. The
                  estimate of Option Price chosen by the third appraiser as the
                  closest to the prevailing fair market value will be binding
                  upon Lessor and BNPLC. Notification in writing of the Option
                  Price shall be made to Lessor and BNPLC within fifteen days
                  following the selection of the third appraiser.

                           (2 If appraisers must be selected under the procedure
                  set out above and either BNPLC or Lessor fails to appoint an
                  appraiser or fails to notify the other party of such
                  appointment within fifteen days after receipt of notice that
                  the prescribed time for appointing the appraisers has passed,
                  then the other party's appraiser will determine the Option
                  Price. All appraisers selected for the appraisal process set
                  out in this Annex will be disinterested, reputable, qualified
                  real estate appraisers with the designation of MAI or
                  equivalent and with at least 5 years experience in appraising
                  properties comparable to the Land.

                           (3 If a third appraiser must be chosen under the
                  procedure set out above, he will be chosen on the basis of
                  objectivity and competence, not on the basis of his
                  relationship with the other appraisers or the parties to this
                  Ground Lease, and the first two appraisers will be so advised.
                  Although the first two appraisers will be instructed to
                  attempt in good faith to agree upon the third appraiser, if
                  for any reason they cannot agree within the prescribed time,
                  either Lessor and BNPLC may require the first two appraisers
                  to immediately submit its top choice for the third appraiser
                  to the then highest ranking officer of the California Bar
                  Association who will agree to help and who has no
                  attorney/client or other significant relationship to either
                  Lessor or BNPLC. Such officer

[Land]

                             Exhibit B-3 - Page 19
<PAGE>

                  will have complete discretion to select the most objective and
                  competent third appraiser from between the choices of each of
                  the first two appraisers, and will do so within ten days after
                  such choices are submitted to him.

                           (4 Either Lessor or BNPLC may notify the appraiser
                  selected by the other party to demand the submission of an
                  estimate of Option Price or a choice of a third appraiser as
                  required under the procedure described above; and if the
                  submission of such an estimate or choice is required but the
                  other party's appraiser fails to comply with the demand within
                  fifteen days after receipt of such notice, then the Option
                  Price or choice of the third appraiser, as the case may be,
                  selected by the other appraiser (i.e., the notifying party's
                  appraiser) will be binding upon Lessor and BNPLC.

                           (5 Lessor and BNPLC shall each bear the expense of
                  the appraiser appointed by it, and the expense of the third
                  appraiser and of any officer of the California Bar Association
                  who participates in the appraisal process described above will
                  be shared equally by Lessor and BNPLC.

[Land]

                             Exhibit B-3 - Page 20
<PAGE>

                                  Exhibit B-4
                                  -----------

                            CORPORATION GRANT DEED


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
-------------------------

NAME:    [Extreme or the Applicable Purchaser]
ADDRESS: ___________________
ATTN:    ___________________
CITY:    ___________________
STATE:   ___________________
Zip:     ___________________

MAIL TAX STATEMENTS TO:
----------------------

NAME:    [Extreme or the Applicable Purchaser]
ADDRESS: ___________________
ATTN:    ___________________
CITY:    ___________________
STATE:   ___________________
Zip:     ___________________


                            CORPORATION GRANT DEED
             (Covering Land but not the Improvements On the Land)

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, BNP
LEASING CORPORATION, a Delaware corporation ("Grantor"), hereby grants to
[Extreme or the Applicable Purchaser] ("Grantee") all of Grantor's interest in
the land situated in Santa Clara, California, described on Annex A attached
hereto and hereby made a part hereof (the "Land"), together with the any other
right, title and interest of Grantor in and to any easements, rights-of-way,
privileges and other rights appurtenant to the Land; provided, however, that
this grant is subject to the encumbrances described on Annex B (the "Permitted
Encumbrances") and any reservations or qualifications set forth below. Grantee
hereby assumes the obligations (including any personal obligations) of Grantor,
if any, created by or under, and agrees to be bound by the terms and conditions
of, the Permitted Encumbrances to the extent that the same concern or apply to
the Land.

Although this deed conveys Grantor's interest in the Land itself, this deed does
not convey any interest in any buildings or other improvements on the Land
(collectively, "Improvements") or any rights or easements appurtenant to
Improvements. Prior to or contemporaneously with the delivery of this deed,
Grantor has conveyed or is conveying the Improvements and appurtenant rights and
easements to another party.

[Land]
<PAGE>

                                               BNP LEASING CORPORATION

Date: As of ____________                       By:     ________________________
                                                       Its:

                                               Attest: ________________________
                                                       Its:

                                               [Extreme or Applicable Purchaser]


Date: As of ____________                       By:     _________________________
                                                       Its:

                                               Attest: ________________________
                                                       Its:

STATE OF ____________      )
                           )       SS
COUNTY OF ___________      )


         On ___________________ before me, ______________, personally appeared
________ and _________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

         WITNESS my hand and official seal.

         Signature____________________

[Land]

                             Exhibit B-4 - Page 2
<PAGE>

STATE OF ____________      )
                           )       SS
COUNTY OF ___________      )


         On ___________________ before me, _______________, personally appeared
__________ and __________, personally known to me (or proved to me on the basis
of satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

         WITNESS my hand and official seal.

         Signature_____________________

[Land]

                             Exhibit B-4 - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION


[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
 -------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DEED TO WHICH THIS DESCRIPTION IS ATTACHED IS
ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

[Land]

                             Exhibit B-4 - Page 4
<PAGE>

                                    Annex B

                            Permitted Encumbrances

[DRAFTING NOTE: TO THE EXTENT THAT ENCUMBRANCES (OTHER THAN "LIENS REMOVABLE BY
 -------------
BNPLC") ARE IDENTIFIED IN ADDITION TO THOSE DESCRIBED BELOW, SUCH ADDITIONAL
ENCUMBRANCES WILL BE ADDED TO THE LIST BELOW AND THIS "DRAFTING NOTE" WILL BE
DELETED BEFORE THIS DEED IS ACTUALLY EXECUTED AND DELIVERED BY BNPLC. SUCH
ADDITIONAL ENCUMBRANCES WOULD INCLUDE ANY NEW ENCUMBRANCES APPROVED BY BNPLC AS
"PERMITTED ENCUMBRANCES" UNDER THE LAND LEASE OR THE OTHER LEASE AGREEMENT FROM
TIME TO TIME OR BECAUSE OF EXTREME'S REQUEST FOR BNPLC'S CONSENT OR APPROVAL TO
AN ADJUSTMENT.]

         This conveyance is subject to all encumbrances not constituting a "Lien
Removable by BNPLC" (as defined in the Common Definitions and Provisions
Agreement (Land) incorporated by reference into the Lease Agreement (Land)
referenced in the last item of the list below), including the following matters
to the extent the same are still valid and in force:

1.       TAXES for the fiscal year 2000-2001, a lien not yet due or payable.

2.       The lien of supplemental taxes, if any, assessed pursuant to the
         provisions of Chapter 3.5, (commencing with Section 75) to the Revenue
         and Taxation Code of the State of California.

3.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of:   City of Santa Clara
         For:     electric wire overhang purposes
         Recorded: November 28, 1960 in Book 4995, Page 160, Official Records
         Affects: Northerly 5 feet of said land, and as shown on the survey
                  prepared by Anthony C. McCants, L.S. 5944, dated
                  April 27, 2000, revised May 22, 2000

4.       The fact that the ownership of said land does not include any right of
         ingress or egress to or from Lawrence Expressway contiguous thereto,
         said right having been relinquished by deed,
         From: Jefferson Union Elementary School District of the County of Santa
               Clara
         To:   County of Santa Clara, State of California
         Recorded:         June 4, 1965 in Book 6982, Page 1, Official Records

         Said land, however, abuts on a public street other than the one
         referred to above, over which rights of vehicular access have not been
         relinquished.

5.       An Agreement, affecting said land, for the purposes stated herein and
         subject to the terms, covenants, conditions, restrictions, and
         easements, if any, contained therein
         For:     Postponed Traffic Signal Improvements
         Dated:   October 4, 1983
         Executed by: City of Santa Clara, California, a municipal corporation
         and MPJ, a California partnership Recorded: November 16, 1983 in Book I
         070, Page 333, Official Records.

6.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of:   City of Santa Clara, a municipal corporation
         For:  roadway purposes and public utilities
         Recorded:   November 30, 1983 in Book I 111, Page 606, Official Records
         Affects: A portion of that certain 24.740 acre parcel of land as shown
         on that certain Record of Survey filed for record in Book 447 of Maps,
         at page 33, Santa Clara County Records, described as

[Land]

                             Exhibit B-4 - Page 5
<PAGE>

                              follows:

         Beginning at a point in the Northerly line of Monroe Avenue, as shown
         on said map at the Westerly terminus of the course shown as N. 89
         degrees 25 minutes 00 seconds E. 760.70; thence from said point of
         beginning along said Northerly line N. 89 degrees 25 minutes 00 seconds
         E. 760.70 feet and N. 2.00 feet; thence leaving said Northerly line
         along a line parallel with said course of N. 89 degrees 25 minutes 00
         seconds E.; S. 89 degrees 25 minutes 00 seconds W. 334.99 feet; thence
         leaving said parallel line N. 87 degrees 09 minutes 00 seconds W. 66.79
         feet; thence along a line parallel with said course N. 89 degrees 25
         minutes 00 seconds E.; S. 89 degrees 25 minutes 00 seconds W. 359.00
         feet; thence leaving said Westerly line along a tangent curve to the
         right, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to a
         point of cusp in the Westerly line of said 24.740 acre parcel; thence
         along said Westerly line S. 0 degrees 00 minutes 27 seconds E. 6.00
         feet; thence leaving said Westerly line along a tangent curve to the
         left, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to the
         point of beginning, and as shown on the survey prepared by Anthony C.
         McCants, L.S. 5944, dated April 27, 2000, revised May 22, 2000.

7.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of:    City of Santa Clara, a municipal corporation
         For:  underground electrical distribution and/or communication systems
         Recorded:    May 17, 1984 in Book I 552, Page 595, Official Records
         Affects. as follows:

         Parcel 1:

         Commencing at the point of intersection of the Westerly line of that
         certain 24.74 acre parcel of land shown upon that Record of Survey
         filed for recorded August 10, 1979 in Book 447 of Maps, at page 33,
         Santa Clara County Records, with a line parallel with and 10 feet
         Southerly of, measured at right angles to, the Northerly line of said
         parcel; thence along said parallel line N. 89 degrees 25 minutes 00
         seconds E. 107.00 feet; thence parallel with said Westerly line S. 0
         degrees 00 minutes 27 seconds E. 319.16 feet; thence S. 34 degrees 02
         minutes 45 seconds W. 87.51 feet, more or less, to intersection with a
         line parallel with and 58 feet Easterly of measured at right angles to,
         said Westerly line; thence along last said parallel line S. 0 degrees
         00 minutes 27 seconds E. 294.30 feet, more or less, to intersection
         with a line parallel with and 5 feet Northerly of, measured at right
         angles to, the Northerly line of that real property conveyed to the
         City of Santa Clara by that deed filed for record November 30, 1983 in
         Book I 111 of Official Records, at page 606, said County Records;
         thence along last said parallel line the following three (3) courses:
         N. 89 degrees 25 minutes 00 seconds E. 351.81 feet; S. 87 degrees 09
         minutes 00 seconds E. 66.79 feet; N. 89 degrees 25 minutes 00 seconds
         E. 334.69 feet; thence continuing parallel with the Southerly line of
         first said parcel N. 89 degrees 25 minutes 00 seconds E. 181.89 feet,
         more or less, to termination in the Easterly line of that certain
         parcel of real property conveyed to MPJ Partnership, by that Grant Deed
         filed for record August 25, 1983 in Book H 838 of Official Records, at
         page 215, said County Records.

         Parcel 2:

         A portion of said 24.74 acre parcel of land contiguous to and Northerly
         of said real property conveyed by deed recorded in Book I 111, at page
         606, contiguous to and Westerly of hereinabove described strip of land
         and bounded on the North by a line parallel with and 5 feet Northerly
         of, measured at right angles to, that course N. 89 degrees 25 minutes
         00 seconds E. 351.81 feet in the hereinabove described centerline.

         Parcel 3:


[Land]
                             Exhibit B-4 - Page 6
<PAGE>

         A strip of land 10 feet in width and 30 feet in length of centerline of
         said strip being parallel with and 325.5 feet Southerly of, measured at
         right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on the West in the Easterly line of first hereinabove
         described strip; thence continuing Easterly along last said parallel
         line for a distance of 15 feet, as the centerline of a strip of land 15
         feet in width, to termination of said centerline and strip.

         Parcel 4:

         A strip of land 10 feet in width and 12 feet in length the centerline
         of said strip being parallel with and 116.5 feet Southerly of, measured
         at right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on the West in the Easterly line of first hereinabove
         described strip; thence continuing Easterly along last said parallel
         line for a distance of 15 feet in width, lying 5 feet Northerly and 10
         feet Southerly of said parallel line to the Easterly terminus of said
         strip.

         Parcel 5:

         A strip of land 10 feet in width, the centerline of said strip being
         described as follows:

         Commencing at the point of intersection of the Northerly line of first
         hereinabove described strip of land with a line parallel with and 824.5
         feet Easterly of, measured at right angles to, that course in the
         Westerly boundary of said 24.75 acre parcel bearing N. 0 degrees 00
         minutes 27 seconds W.; thence along last said parallel line N. 0
         degrees 00 minutes 27 seconds W. 367.96 feet, more or less, to a line
         parallel with and 327 feet Southerly of, measured at right angles to,
         said Northerly line of the 24.74 acre parcel; thence along last said
         parallel line S. 89 degrees 25 minutes 00 seconds W. 78 feet to a line
         parallel with and 746.5 feet Easterly of, measured at right angles to,
         said Westerly line of the 24.74 acre parcel; thence along last said
         parallel line N. 0 degrees 00 minutes 27 seconds W. 203 feet; thence
         continuing as the centerline of a strip of land 15 feet in width N. 0
         degrees 00 minutes 27 seconds W. 15 feet, more or less, to termination
         of said strip and centerline in a line parallel with and 109 feet
         Southerly of, measured at right angles to, last said Northerly line.

         Parcel 6:

         A 15 foot square parcel of land contiguous to and Southerly of last
         hereinabove described 10 foot wide strip of land and centered on the
         Southerly prolongation of hereinabove mentioned course N. 0 degrees 00
         minutes 27 seconds W. 203 feet, and as shown on the survey prepared by
         Anthony C. McCants, L.S. 5944, dated April 27, 2000, revised May 22,
         2000.

8.       Lease Agreement (Land) dated as of June 1, 2000, by and between BNP
         Leasing Corporation, as lessor, and Extreme Networks, Inc., as lessee,
         and Lease Agreement (Improvements) dated as of June 1, 2000, by and
         between BNP Leasing Corporation, as lessor, and Extreme Networks, Inc.,
         as lessee.


[Land]
                             Exhibit B-4 - Page 7
<PAGE>

                                   Exhibit C
                                   ---------

                          BILL OF SALE AND ASSIGNMENT


         Reference is made to: (1) that certain Purchase Agreement (Land)
between BNP Leasing Corporation ("Assignor") and Extreme Networks, Inc., dated
as of June 1, 2000, (the "Purchase Agreement") and (2) that certain Lease
Agreement (Land) between Assignor, as landlord, and Extreme Networks, Inc., as
tenant, dated as of June __, 2000 (the "Land Lease"). (Capitalized terms used
and not otherwise defined in this document are intended to have the meanings
assigned to them in the Common Definitions and Provisions Agreement (Land)
incorporated by reference into both the Purchase Agreement and Land Lease.)

         As contemplated by the Purchase Agreement, Assignor hereby sells,
transfers and assigns unto [EXTREME OR THE APPLICABLE PURCHASER, AS THE CASE MAY
BE], a _____________ ("Assignee"), all of Assignor's right, title and interest
in and to the following property, if any, to the extent such property is
assignable:

         (a)   the Land Lease;

         (b)   any pending or future award made because of any condemnation
affecting the Property or because of any conveyance to be made in lieu thereof,
and any unpaid award for damage to the Property and any unpaid proceeds of
insurance or claim or cause of action for damage, loss or injury to the
Property; and

         (c)   all other property included within the definition of "Property"
as set forth in the Purchase Agreement.

Provided, however, excluded from this conveyance and reserved to Assignor are
any rights or privileges of Assignor under the following ("Excluded Rights"):
(1) the indemnities set forth in the Land Lease, whether such rights are
presently known or unknown, including rights of the Assignor to be indemnified
against environmental claims of third parties as provided in the Land Lease
which may not presently be known, (2) provisions in the Land Lease that
establish the right of Assignor to recover any accrued unpaid rent under the
Land Lease which may be outstanding as of the date hereof, (3) agreements
between Assignor and "BNPLC's Parent" or any "Participant," both as defined in
the Land Lease, or any modification or extension thereof, or (4) any other
instrument being delivered to Assignor contemporaneously herewith pursuant to
the Purchase Agreement. To the extent that this conveyance does include any
rights to receive future payments under the Land Lease, such rights ("Included
Rights") shall be subordinate to Assignor's Excluded Rights, and Assignee hereby
waives any rights to enforce Included Rights until such time as Assignor has
received all payments to which it remains entitled by reason of Excluded Rights.
If any amount shall be paid to Assignee on account of any Included Rights at any
time before Assignor has received all payments to which it is entitled because
of Excluded Rights, such amount shall be held in trust by Assignee for the
benefit of Assignor, shall be segregated from the other funds of Assignee and
shall forthwith be paid over to Assignor to be held by Assignor as collateral
for, or then or at any time thereafter applied in whole or in part by Assignor
against, the payments due to Assignor because of Excluded Rights, whether
matured or unmatured, in such order as Assignor shall elect.

         Assignor does for itself and its successors covenant and agree to
warrant and defend the title to the property assigned herein against the just
and lawful claims and demands of any person claiming under or through a Lien
Removable by BNPLC, but not otherwise.

         Assignee hereby assumes and agrees to keep, perform and fulfill
Assignor's obligations, if any, relating to any permits or contracts, under
which Assignor has rights being assigned herein.


[Land]
<PAGE>

         IN WITNESS WHEREOF, the parties have executed this instrument as of
_______________, _____.



                                        ASSIGNOR:
                                        --------

                                        BNP LEASING CORPORATION a Delaware
                                        corporation



                                        By:__________________________________
                                        Its:_________________________________


                                        ASSIGNEE:
                                        --------

                                        [Extreme or the Applicable Purchaser], a
                                        ____________________



                                        By:__________________________________
                                        Its:_________________________________


[Land]
                              Exhibit C - Page 2
<PAGE>

STATE OF ____________          )
                               )    SS
COUNTY OF ___________   )


         On ___________________ before me, _______, personally appeared ______
and _______, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

         WITNESS my hand and official seal.



         Signature _________________________




STATE OF ____________          )
                               )    SS
COUNTY OF ___________   )


         On ___________________ before me, _______, personally appeared ______
and _______, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

         WITNESS my hand and official seal.



         Signature _________________________


[Land]
                              Exhibit C - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION

[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
 --------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DOCUMENT TO WHICH THIS DESCRIPTION IS ATTACHED
IS ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.



[Land]
                              Exhibit C - Page 4
<PAGE>

                                   Exhibit D
                                   ---------

        ACKNOWLEDGMENT OF DISCLAIMER OF REPRESENTATIONS AND WARRANTIES

         THIS ACKNOWLEDGMENT OF DISCLAIMER OF REPRESENTATIONS AND WARRANTIES
(this "Certificate") is made as of ___________________, ____, by [Extreme or the
Applicable Purchaser, as the case may be], a ___________________ ("Grantee").

         Contemporaneously with the execution of this Certificate, BNP Leasing
Corporation, a Delaware corporation ("BNPLC"), is executing and delivering to
Grantee (1) a corporate grant deed and (2) a Bill of Sale and Assignment (the
foregoing documents and any other documents to be executed in connection
therewith are herein called the "Conveyancing Documents" and any of the
properties, rights or other matters assigned, transferred or conveyed pursuant
thereto are herein collectively called the "Subject Property").

         Notwithstanding any provision contained in the Conveyancing Documents
to the contrary, Grantee acknowledges that BNPLC makes no representations or
warranties of any nature or kind, whether statutory, express or implied, with
respect to environmental matters or the physical condition of the Subject
Property, and Grantee, by acceptance of the Conveyancing Documents, accepts the
Subject Property "AS IS," "WHERE IS," "WITH ALL FAULTS" and without any such
                  -----    --------    ---------------
representation or warranty by Grantor as to environmental matters, the physical
condition of the Subject Property, compliance with subdivision or platting
requirements or construction of any improvements. Without limiting the
generality of the foregoing, Grantee hereby further acknowledges and agrees that
warranties of merchantability and fitness for a particular purpose are excluded
from the transaction contemplated by the Conveyancing Documents, as are any
warranties arising from a course of dealing or usage of trade. Grantee hereby
assumes all risk and liability (and agrees that BNPLC shall not be liable for
any special, direct, indirect, consequential, or other damages) resulting or
arising from or relating to the ownership, use, condition, location,
maintenance, repair, or operation of the Subject Property, except for damages
proximately caused by (and attributed by any applicable principles of
comparative fault to) the Established Misconduct of BNPLC. As used in the
preceding sentence, "Established Misconduct" is intended to have, and be limited
to, the meaning given to it in the Common Definitions and Provisions Agreement
(Land) incorporated by reference into the Purchase Agreement between BNPLC and
Extreme Networks, Inc. dated as of June 1, 2000, pursuant to which Purchase
Agreement BNPLC is delivering the Conveyancing Documents.

         The provisions of this Certificate shall be binding on Grantee, its
successors and assigns and any other party claiming through Grantee. Grantee
hereby acknowledges that BNPLC is entitled to rely and is relying on this
Certificate.

         EXECUTED as of ________________, ____.

                                        [Extreme or the Applicable Purchaser]
                                        By:_____________________________________
                                           Name:________________________________
                                           Title:_______________________________



[Land]
<PAGE>

                                   Exhibit E
                                   ---------

                            SECRETARY'S CERTIFICATE


         The undersigned, [Secretary or Assistant Secretary] of BNP Leasing
Corporation, a Delaware corporation (the "Corporation"), hereby certifies as
follows:

         1.    That he is the duly, elected, qualified and acting Secretary [or
Assistant Secretary] of the Corporation and has custody of the corporate
records, minutes and corporate seal.

         2.    That the following named persons have been properly designated,
elected and assigned to the office in the Corporation as indicated below; that
such persons hold such office at this time and that the specimen signature
appearing beside the name of such officer is his or her true and correct
signature.

[The following blanks must be completed with the names and signatures of the
officers who will be signing the deed and other Sale Closing Documents on behalf
of the Corporation.]

Name                      Title                        Signature
----                      -----                        ---------

_______________           _________________            _________________________

_______________           _________________            _________________________


         3. That the resolutions attached hereto and made a part hereof were
duly adopted by the Board of Directors of the Corporation in accordance with the
Corporation's Articles of Incorporation and Bylaws. Such resolutions have not
been amended, modified or rescinded and remain in full force and effect.

         IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal
of the Corporation on this __, day of ___, __.



                             _________________________________
                             [signature and title]



[Land]
<PAGE>

                           CORPORATE RESOLUTIONS OF
                            BNP LEASING CORPORATION


         WHEREAS, pursuant to that certain Purchase Agreement (Land) (herein
called the "Purchase Agreement") dated as of June 1, 2000, by and between BNP
Leasing Corporation (the "Corporation") and [Extreme or the Applicable Purchaser
as the case may be] ("Purchaser"), the Corporation agreed to sell and Purchaser
agreed to purchase or cause the Applicable Purchaser (as defined in the Purchase
Agreement) to purchase the Corporation's interest in the property (the
"Property") located in Santa Clara, California more particularly described
therein.

         NOW THEREFORE, BE IT RESOLVED, that the Board of Directors of the
Corporation, in its best business judgment, deems it in the best interest of the
Corporation and its shareholders that the Corporation convey the Property to
Purchaser or the Applicable Purchaser pursuant to and in accordance with the
terms of the Purchase Agreement.

         RESOLVED FURTHER, that the proper officers of the Corporation, and each
of them, are hereby authorized and directed in the name and on behalf of the
Corporation to cause the Corporation to fulfill its obligations under the
Purchase Agreement.

         RESOLVED FURTHER, that the proper officers of the Corporation, and each
of them, are hereby authorized and directed to take or cause to be taken any and
all actions and to prepare or cause to be prepared and to execute and deliver
any and all deeds and other documents, instruments and agreements that shall be
necessary, advisable or appropriate, in such officer's sole and absolute
discretion, to carry out the intent and to accomplish the purposes of the
foregoing resolutions.

[Land]
                              Exhibit E - Page 2
<PAGE>

                                   Exhibit F
                                   ---------

                               FIRPTA STATEMENT

         Section 1445 of the Internal Revenue Code of 1986, as amended, provides
that a transferee of a U.S. real property interest must withhold tax if the
transferor is a foreign person. Sections 18805, 18815 and 26131 of the
California Revenue and Taxation Code, as amended, provide that a transferee of a
California real property interest must withhold income tax if the transferor is
a nonresident seller.

         To inform [Extreme or the Applicable Purchaser] (the "Transferee") that
withholding of tax is not required upon the disposition of a California real
property interest by transferor, BNP Leasing Corporation (the "Seller"), the
undersigned hereby certifies the following on behalf of the Seller:

         1. The Seller is not a foreign corporation, foreign partnership,
foreign trust, or foreign estate (as those terms are defined in the Internal
Revenue Code and Income Tax Regulations);

         2. The United States employer identification number for the Seller is
_____________________;

         3.The office address of the Seller is ______________
_________________________ _________________.

         4. The Seller is qualified to do business in California.

         The Seller understands that this certification may be disclosed to the
Internal Revenue Service and/or to the California Franchise Tax Board by the
Transferee and that any false statement contained herein could be punished by
fine, imprisonment, or both.

         The Seller understands that the Transferee is relying on this affidavit
in determining whether withholding is required upon said transfer.

         Under penalties of perjury I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of the Seller.

         Dated: ___________, ____.


                                            By:_________________________
                                             Name:______________________
                                             Title:_____________________

[Land]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.11
<SEQUENCE>7
<FILENAME>0007.txt
<DESCRIPTION>FORM OF PURCHASE AGREEMENT (IMPROVEMENTS) JUNE 1, 2000
<TEXT>

<PAGE>

================================================================================

                                                                   EXHIBIT 10.11


                              PURCHASE AGREEMENT
                                (IMPROVEMENTS)



                                    BETWEEN



                            BNP LEASING CORPORATION


                                   ("BNPLC")


                                      AND


                            EXTREME NETWORKS, INC.

                                  ("Extreme")




                                 June 1, 2000

                           (Santa Clara, California)

================================================================================
<PAGE>

                               TABLE OF CONTENTS
                               -----------------

<TABLE>
<CAPTION>
                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
1.   EXTREME'S OPTIONS AND OBLIGATIONS ON THE DESIGNATED SALE DATE............................................    1
     (A)  Right to Purchase; Initial Remarketing Rights and Obligation........................................    1
          ------------------------------------------------------------
     (B)  Determinations Concerning Price.....................................................................    3
          -------------------------------
     (C)  Designation of the Purchaser........................................................................    4
          ----------------------------
     (D)  Effect of the Purchase Option and Extreme's Initial Remarketing Rights and Obligations..............    4
          --------------------------------------------------------------------------------------
          on Subsequent Title Encumbrances
          --------------------------------
     (E)  Security for the Purchase Option and Extreme's Initial Remarketing Rights and Obligations...........    4
          -----------------------------------------------------------------------------------------
     (F)  Delivery of Books and Records If BNPLC Retains the Property.........................................    5
          -----------------------------------------------------------

2.   EXTREME'S RIGHTS AND OPTIONS AFTER THE DESIGNATED SALE DATE..............................................    5
     (A)  Extreme's Extended Right to Remarket................................................................    5
          ------------------------------------
     (B)  Definition of Minimum Extended Remarketing Price....................................................    6
          ------------------------------------------------
     (C)  BNPLC's Right to Sell...............................................................................    6
          ---------------------
     (D)  Extreme's Right to Excess Sales Proceeds............................................................    7
          ----------------------------------------
     (E)  Permitted Transfers During Extreme's Extended Remarketing Period....................................    7
          ----------------------------------------------------------------

3.   TERMS OF CONVEYANCE UPON PURCHASE........................................................................    7

4.   SURVIVAL AND TERMINATION OF THE RIGHTS AND OBLIGATIONS OF EXTREME AND BNPLC..............................    8
     (A)  Status of this Agreement Generally..................................................................    8
          ----------------------------------
     (B)  Automatic Termination of Extreme's Rights...........................................................    8
          -----------------------------------------
     (C)  Termination of Extreme's Extended Remarketing Rights to Permit a Sale by BNPLC......................    9
          ------------------------------------------------------------------------------
     (D)  Payment Only to BNPLC...............................................................................    9
          ---------------------
     (E)  Remedies Under the Other Operative Documents........................................................    9
          --------------------------------------------
     (F)  Occupancy by Extreme Prior to Closing of a Sale.....................................................    9
          -----------------------------------------------

5.   SECURITY FOR EXTREME'S OBLIGATIONS; RETURN OF FUNDS......................................................    9

6.   CERTAIN REMEDIES CUMULATIVE..............................................................................   10

7.   ATTORNEYS' FEES AND LEGAL EXPENSES.......................................................................   10

8.   ESTOPPEL CERTIFICATE.....................................................................................   10

9.   SUCCESSORS AND ASSIGNS...................................................................................   10
</TABLE>
<PAGE>

                            Exhibits and Schedules
                            ----------------------

<TABLE>
<S>                                                            <C>
Exhibit A.....................................................                      Legal Description
---------

Exhibit B.....................................................           Grant Deed Form Requirements
---------

Exhibit C.....................................................            Bill of Sale and Assignment
---------

Exhibit D.....................................................          Acknowledgment and Disclaimer
---------

Exhibit E.....................................................                Secretary's Certificate
---------

Exhibit F..................................................... Certificate Concerning Tax Withholding
---------
</TABLE>
<PAGE>

                              PURCHASE AGREEMENT
                                (IMPROVEMENTS)


     This PURCHASE AGREEMENT (IMPROVEMENTS) (this "Agreement") is made and dated
as of June 1, 2000 (the "Effective Date") by and between BNP LEASING
CORPORATION, a Delaware corporation ("BNPLC"), and EXTREME NETWORKS, INC., a
Delaware corporation ("Extreme").

                                   RECITALS

     Contemporaneously with the execution of this Agreement, BNPLC and Extreme
are executing a Common Definitions and Provisions Agreement (Improvements) dated
as of the Effective Date (the "Common Definitions and Provisions Agreement
(Improvements)"), which by this reference is incorporated into and made a part
of this Agreement for all purposes. As used in this Agreement, capitalized terms
defined in the Common Definitions and Provisions Agreement (Improvements) and
not otherwise defined in this Agreement are intended to have the respective
meanings assigned to them in the Common Definitions and Provisions Agreement
(Improvements).

     Pursuant to the Acquisition Contract, which covers the Land described in
Exhibit A, BNPLC is acquiring the Land and any appurtenances thereto and the
---------
existing Improvements thereon from Seller contemporaneously with the execution
of this Agreement. Pursuant to the Lease Agreement (Improvements) executed by
BNPLC and Extreme contemporaneously with this Agreement (the "Improvements
Lease"), BNPLC is leasing the Improvements on the Land to Extreme and agreeing
to provide funding for renovations, remodeling, improvements and furnishing of
the Improvements, all of which will be owned by BNPLC. (All of BNPLC's
interests, including those created by the documents delivered at the closing
under the Acquisition Contract, in the Improvements and in all other real and
personal property from time to time covered by the Improvements Lease and
included within the "Property" as defined therein are hereinafter collectively
referred to as the "Property". The Property does not include the Land itself, it
being understood that the Other Purchase Agreement constitutes a separate
agreement providing for the possible sale of the Land and the appurtenances
thereto, and only the Land and the appurtenances thereto, from BNPLC to Extreme
or a third party designated by Extreme.)

     Extreme and BNPLC have reached agreement upon the terms and conditions upon
which Extreme will purchase or arrange for the purchase of the Property, and by
this Agreement they desire to evidence such agreement.

                                  AGREEMENTS

     1.   EXTREME'S OPTIONS AND OBLIGATIONS ON THE DESIGNATED SALE DATE.

          (A)  Right to Purchase; Initial Remarketing Rights and Obligation.
               ------------------------------------------------------------
Whether or not an Event of Default shall have occurred and be continuing or the
Improvements Lease shall have been terminated, but subject to Paragraph 4 below:

               (1)  Extreme shall have the right (the "Purchase Option") to
     purchase or cause an Affiliate of Extreme to purchase the Property and
     BNPLC's interest in Escrowed Proceeds, if any, on the Designated Sale Date
     for a cash price equal to the Break Even Price (as defined below).

               (2)  If neither Extreme nor an Affiliate of Extreme purchases the
     Property and BNPLC's interest in any Escrowed Proceeds on the Designated
     Sale Date as provided in the preceding
<PAGE>

     subparagraph 1.(A)(1), then Extreme shall have the following rights and
     obligations (collectively, "Extreme's Initial Remarketing Rights and
     Obligations"):

                    (a)  First, Extreme shall have the right (but not the
          obligation) to cause an Applicable Purchaser who is not an Affiliate
          of Extreme to purchase the Property and BNPLC's interest in any
          Escrowed Proceeds on the Designated Sale Date for a cash purchase
          price (the "Third Party Price") determined as provided below. If,
          however, the Break Even Price exceeds the sum of any Third Party Price
          tendered or to be tendered to BNPLC by an Applicable Purchaser and any
          Supplemental Payment paid by Extreme as described below, then BNPLC
          may affirmatively elect to decline such tender from the Applicable
          Purchaser and to keep the Property and any Escrowed Proceeds rather
          than sell to the Applicable Purchaser pursuant to this subparagraph (a
          "Voluntary Retention of the Property").

                    (b)  Second, if the Third Party Price actually paid by an
          Applicable Purchaser to BNPLC on the Designated Sale Date exceeds the
          Break Even Price, Extreme shall be entitled to such excess, subject,
          however, to BNPLC's right to offset against such excess any and all
          sums that are then due from Extreme to BNPLC under the other Operative
          Documents.

                    (c)  Third, if for any reason whatsoever (including a
          Voluntary Retention of the Property or a decision by Extreme not to
          exercise its right to purchase or cause an Applicable Purchaser to
          purchase from BNPLC as described above) neither Extreme nor an
          Applicable Purchaser pays a net cash price to BNPLC on the Designated
          Sale Date equal to or in excess of the Break Even Price in connection
          with a sale of the Property and BNPLC's interest in any Escrowed
          Proceeds pursuant to this Agreement, then Extreme shall have the
          obligation to pay to BNPLC on the Designated Sale Date a supplemental
          payment (the "Supplemental Payment") equal to the lesser of (1) the
          amount by which the Break Even Price exceeds such net cash price (if
          any) actually received by BNPLC on the Designated Sale Date (such
          excess being hereinafter called a "Deficiency") or (2) the Maximum
          Remarketing Obligation. As used herein, the "Maximum Remarketing
          Obligation" means a dollar amount determined in accordance with the
          following provisions:

                              1)   The "Maximum Remarketing Obligation" will
               equal the product of (i) Stipulated Loss Value on the Designated
               Sale Date, times (ii) 100% minus the Residual Risk Percentage,
               provided that both of the following conditions are satisfied:

                                   (x)  Extreme shall not have elected to
                    accelerate the Designated Sale Date as provided in clause
                    (2) of the definition of Designated Sale Date in the Common
                    Definitions and Provisions Agreement (Improvements).

                                   (y)  No Event of Default, other than an Issue
                    97-1 Non-performance-related Subjective Event of Default,
                    shall occur on or be continuing on the Designated Sale Date.

                              2)   If either of the conditions listed in
               subparagraph 1) preceding are not satisfied, the "Maximum
               Remarketing Obligation" will equal the Break Even Price.

If any Supplemental Payment or other amount payable to BNPLC pursuant to this
subparagraph 1.(A) is not actually paid to BNPLC on the Designated Sale Date,
Extreme shall pay interest on the past due amount computed at the Default Rate
from the Designated Sale Date.

                                       2
<PAGE>

          (B)  Determinations Concerning Price.
               -------------------------------

               (1)  Determination of the Break Even Price.  As used herein,
                    -------------------------------------
     "Break Even Price" means an amount equal, on the Designated Sale Date, to
     Stipulated Loss Value, plus all out-of-pocket costs and expenses (including
     appraisal costs, withholding taxes (if any) not constituting Excluded
     Taxes, and Attorneys' Fees) incurred by BNPLC in connection with any sale
     of BNPLC's interests in the Property under this Agreement or in connection
     with collecting payments due hereunder, but less the aggregate amounts (if
                                             --------
     any) of Direct Payments to Participants and Deposit Taker Losses.

               (2)  Determination of Third Party Price.  The Third Party Price
                    ----------------------------------
     required of any Applicable Purchaser purchasing from BNPLC under
     subparagraph 1.(A)(2)(a) will be determined as follows:

               (a)  Extreme may give a notice (a "Remarketing Notice") to BNPLC
          and to each of the Participants no earlier than one hundred twenty
          days before the Designated Sale Date and no later than ninety days
          before the Designated Sale Date, specifying an amount as the Third
          Party Price that Extreme believes in good faith to constitute
          reasonably equivalent value for the Property and any Escrowed
          Proceeds. Once given, a Remarketing Notice shall not be rescinded or
          modified without BNPLC's written consent.

               (b)  If BNPLC believes in good faith that the Third Party Price
          specified by Extreme in a Remarketing Notice does not constitute
          reasonably equivalent value for the Property and any Escrowed
          Proceeds, BNPLC may at any time before sixty days prior to the
          Designated Sale Date respond to the Remarketing Notice with a notice
          back to Extreme, objecting to the Third Party Price so specified by
          Extreme. If BNPLC receives a Remarketing Notice, yet does not respond
          with an objection as provided in the preceding sentence, the Third
          Party Price suggested by Extreme in the Remarketing Notice will be the
          Third Party Price for purposes of this Agreement. If, however, BNPLC
          does respond with an objection as provided in this subparagraph, and
          if Extreme and BNPLC do not otherwise agree in writing upon a Third
          Party Price, then the Third Party Price will be the lesser of (I) fair
          market value of the Property, plus the amount of any Escrowed
          Proceeds, as determined by a professional independent appraiser
          selected by BNPLC, or (II) the Break Even Price.

               (c)  If for any reason, including an acceleration of the
          Designated Sale Date as provided in the definition thereof in the
          Common Definitions and Provisions Agreement (Improvements), Extreme
          does not deliver a Remarketing Notice to BNPLC within the time period
          specified above, then the Third Party Price will be an amount
          determined in good faith by BNPLC as constituting reasonably
          equivalent value for the Property and any Escrowed Proceeds, but in no
          event more than the Break Even Price.

     If any payment to BNPLC by an Applicable Purchaser hereunder is held to
     constitute a preference or a voidable transfer under Applicable Law, or
     must for any other reason be refunded by BNPLC to the Applicable Purchaser
     or to another Person, and if such payment to BNPLC reduced or had the
     effect of reducing a Supplemental Payment or increased or had the effect of
     increasing any excess sale proceeds paid to Extreme pursuant to
     subparagraph 1(A)(2)(b) or pursuant to subparagraph 2.(D), then Extreme
     shall pay to BNPLC upon demand an amount equal to the reduction of the
     Supplemental Payment or to the increase of the excess sale proceeds paid to
     Extreme, as applicable, and this Agreement shall continue to be effective
     or shall be reinstated as necessary to permit BNPLC to enforce its right to
     collect such amount from Extreme.

                                       3
<PAGE>

          (C)  Designation of the Purchaser. To give BNPLC the opportunity
               ----------------------------
before the Designated Sale Date to prepare the deed and other documents that
BNPLC must tender pursuant to Paragraph 3 (collectively, the "Sale Closing
Documents"), Extreme must, by a notice to BNPLC given at least seven days prior
to the Designated Sale Date, specify irrevocably, unequivocally and with
particularity the party who will purchase the Property in order to satisfy the
obligations of Extreme set forth in subparagraph 1(A). If for any reason Extreme
fails to so specify a party who will in accordance with the terms and conditions
set forth herein purchase the Property (be it Extreme itself, an Affiliate of
Extreme or another Applicable Purchaser), BNPLC shall be entitled to postpone
the tender of the Sale Closing Documents until a date after the Designated Sale
Date and not more than twenty days after Extreme finally does so specify a
party, but such postponement will not relieve or postpone the obligation of
Extreme to make a Supplemental Payment on the Designated Sale Date as provided
in Paragraph 1.(A)(2)(c).

          (D)  Effect of the Purchase Option and Extreme's Initial Remarketing
               ---------------------------------------------------------------
Rights and Obligations on Subsequent Title Encumbrances. Any conveyance of the
-------------------------------------------------------
Property to Extreme or any Applicable Purchaser pursuant to this Paragraph 1.(A)
shall cut off and terminate any interest in the Improvements or other Property
claimed by, through or under BNPLC, including any interest claimed by the
Participants and including any Liens Removable by BNPLC (such as, but not
limited to, any judgment liens established against the Property because of a
judgment rendered against BNPLC and any leasehold or other interests conveyed by
BNPLC in the ordinary course of BNPLC's business), but not including personal
obligations of Extreme to BNPLC under the Improvements Lease or other Operative
Documents (including obligations arising under the indemnities therein). Anyone
accepting or taking any interest in the Property by or through BNPLC after the
date of this Agreement shall acquire such interest subject to the Purchase
Option and Extreme's Initial Remarketing Rights and Obligations. Further,
Extreme and any Applicable Purchaser shall be entitled to pay any payment
required by this Agreement for the purchase of the Property directly to BNPLC
notwithstanding any prior conveyance or assignment by BNPLC, voluntary or
otherwise, of any right or interest in this Agreement or the Property, and
neither Extreme nor any Applicable Purchaser shall be responsible for the proper
distribution or application of any such payments by BNPLC; and any such payment
to BNPLC shall discharge the obligation of Extreme to cause such payment to all
Persons claiming an interest in such payment. Contemporaneously with the
execution of this Agreement, the parties shall record a memorandum of this
Agreement for purposes of effecting constructive notice to all Persons of
Extreme's rights under this Agreement, including its rights under this
subparagraph.

          (E)  Security for the Purchase Option and Extreme's Initial
               ------------------------------------------------------
Remarketing Rights and Obligations. To secure BNPLC's obligation to sell the
----------------------------------
Property pursuant to Paragraph 1.(A) and to pay any damages to Extreme caused by
a breach of such obligations, including any such breach caused by a rejection or
termination of this Agreement in any bankruptcy or insolvency proceeding
instituted by or against BNPLC, as debtor, BNPLC does hereby grant to Extreme a
lien and security interest against all rights, title and interests of BNPLC from
time to time in and to the Improvements and other Property. Extreme may enforce
such lien and security interest judicially after any such breach by BNPLC, but
not otherwise. Contemporaneously with the execution of this Agreement, Extreme
and BNPLC will execute a memorandum of this Agreement which is in recordable
form and which specifically references the lien granted in this subparagraph,
and Extreme shall be entitled to record such memorandum at any time prior to the
Designated Sale Date.

          (F)  Delivery of Books and Records If BNPLC Retains the Property.
               -----------------------------------------------------------
Unless Extreme or its Affiliate or another Applicable Purchaser purchases the
Property pursuant to Paragraph 1.(A), promptly after the Designated Sale Date
Extreme shall deliver to BNPLC copies of all plans and specifications for the
Property prepared in connection with any Initial Renovations made as
contemplated by the Improvements Lease, together with all other books and
records of Extreme which will be necessary or useful to any future owner's or
occupant's use of the Property in the manner permitted by the Improvements
Lease.

     2.   EXTREME'S RIGHTS AND OPTIONS AFTER THE DESIGNATED SALE DATE.

                                       4
<PAGE>

          (A)  Extreme's Extended Right to Remarket. During the two years
               ------------------------------------
following the Designated Sale Date ("Extreme's Extended Remarketing Period"),
Extreme shall have the right ("Extreme's Extended Remarketing Right") to cause
an Applicable Purchaser who is not an Affiliate of Extreme to purchase the
Property for a cash purchase price not below the Minimum Extended Remarketing
Price (as defined below). Extreme's Extended Remarketing Right shall, however,
be subject to all of the following conditions:

               (1)  The Property and BNPLC's interest in Escrowed Proceeds, if
     any, shall not have been sold on the Designated Sale Date as provided in
     Paragraph 1 or within the thirty days thereafter as provided in
     subparagraph 4.(B).

               (2)  No Voluntary Retention of the Property shall have occurred
     as described in subparagraph 1.(A)(2)(a).

               (3)  Extreme's Extended Remarketing Right shall not have been
     terminated pursuant to subparagraph 4.(B) below because of Extreme's
     failure to make any Supplemental Payment required on the Designated Sale
     Date.

               (4)  Extreme's Extended Remarketing Right shall not have been
     terminated by BNPLC pursuant to subparagraph 4.(C) below to facilitate
     BNPLC's sale of the Property to a third party in accordance with
     subparagraph 2.(C).

               (5)  At least thirty days prior to the date upon which BNPLC is
     to convey the Property to an Applicable Purchaser because of Extreme's
     exercise of Extreme's Extended Remarketing Right (the "Final Sale Date"),
     Extreme shall have notified BNPLC of (x) the date proposed by Extreme as
     the Final Sale Date (which must be a Business Day), (y) the full legal name
     of the Applicable Purchaser and such other information as will be required
     to prepare the Sale Closing Documents, and (z) the amount of the purchase
     price that the Applicable Purchaser will pay (consistent with the minimum
     required pursuant to the other provisions of this subparagraph 2.(A)) for
     the Property.

          (B)  Definition of Minimum Extended Remarketing Price. As used herein,
               ------------------------------------------------
the "Minimum Extended Remarketing Price" means, subject to reduction as provided
in subparagraph 2.(C) below, an amount equal to the sum of the following:

               (1)  the amount by which the Break Even Price computed on the
     Designated Sale Date exceeds any Supplemental Payment actually paid to
     BNPLC on the Designated Sale Date, together with interest on such excess
     computed at the Default Rate from the period commencing on the Designated
     Sale Date and ending on the Final Sale Date, plus
                                                  ----

               (2)  all out-of-pocket costs and expenses (including withholding
     taxes [if any], other than Excluded Taxes, and Attorneys' Fees) incurred by
     BNPLC in connection with the sale to the Applicable Purchaser, to the
     extent not already included in the computation of Break Even Price, and
                                                                         ---
     plus
     ----

               (3)  the sum of all Impositions, insurance premiums and other
     Losses of every kind suffered or incurred by BNPLC or any other Interested
     Party with respect to the ownership, operation or maintenance of the
     Property on or after the Designated Sale Date, together with interest on
     such Impositions, insurance premiums and other Losses computed at the
     Default Rate from the date paid or incurred to the Final Sale Date.

If, however, Losses described in the preceding clause (3) consist of claims
against BNPLC or another Interested Party that have not been liquidated prior to
the Final Sale Date (and, thus, such Losses have yet to be fixed in

                                       5
<PAGE>

amount as of the Final Sale Date), then Extreme may elect to exclude any such
Losses from the computation of the Minimum Extended Remarketing Price by
providing to BNPLC, for the benefit of BNPLC and other Interested Parties, a
written agreement to indemnify and defend BNPLC and other Interested Parties
against such Losses. To be effective hereunder for purposes of reducing the
Minimum Extended Remarketing Price (and, thus, the Break Even Price), any such
written indemnity must be fully executed and delivered by Extreme on or prior to
the Final Sale Date, must include provisions comparable to subparagraphs
                                                           -------------
5(c)(ii), (iii), (iv) and (v) of the Improvements Lease and otherwise must be in
-----------------------------
form and substance satisfactory to BNPLC.

          (C)  BNPLC's Right to Sell.  After the Designated Sale Date, if the
               ---------------------
Property has not already been sold by BNPLC pursuant to Paragraph 1 or this
Paragraph 2, BNPLC shall have the right to sell the Property or offer the
Property for sale to any third party on any terms believed to be appropriate by
BNPLC in its sole good faith business judgment; provided, however, that so long
as the conditions to Extreme's Extended Remarketing Rights specified in
subparagraph 2.(A) continue to be satisfied:

               (1)  BNPLC shall not sell the Property to an Affiliate of BNPLC
     on terms less favorable than those which BNPLC would require from a
     prospective purchaser not an Affiliate of BNPLC;

               (2)  If BNPLC receives or desires to make a written proposal
     (whether in the form of a "letter of intent" or other nonbinding expression
     of interest or in the form of a more definitive purchase and sale
     agreement) for a sale of the Property to a prospective purchaser (a "Third
     Party Sale Proposal"), and if on the basis of such Third Party Sale
     Proposal BNPLC expects to enter into or to pursue negotiations for a
     definitive purchase and sale agreement with the prospective purchaser, then
     prior to executing any such definitive agreement, BNPLC shall submit the
     Third Party Sale Proposal to Extreme with a notice (the "Third Party Sale
     Notice") explaining that (A) BNPLC is then prepared to accept a price not
     below an amount specified in such Third Party Sale Notice (the "Third Party
     Target Price") if BNPLC and the prospective purchaser reach agreement on
     other terms and conditions to be incorporated into a definitive purchase
     and sale agreement, and (B) Extreme's Extended Remarketing Right may be
     terminated pursuant to subparagraph 4.(C) of this Agreement unless Extreme
     causes an Applicable Purchaser to consummate a purchase of the Property
     pursuant to this Paragraph 2 within ninety days after the date of such
     Third Party Sale Notice.

For a period of ninety days (but only ninety days) after the date of any Third
Party Sale Notice, the Minimum Extended Remarketing Price shall be limited in
amount so that it does not exceed the Third Party Target Price specified by
BNPLC therein. Accordingly, if BNPLC has delivered a Third Party Sale Notice
specifying a Third Party Target Price below the Minimum Extended Remarketing
Price calculated as provided in subparagraph 2.(B) within the ninety days prior
to the Final Sale Date for any sale to an Applicable Purchaser by BNPLC pursuant
to this Paragraph 2, then the Minimum Extended Remarketing Price applicable to
such sale shall be reduced to the amount of the Third Party Target Price so
specified. Such a reduction, however, will apply only to a sale to an Applicable
Purchaser actually consummated within the ninety days after the date of the
applicable Third Party Sale Notice.

          (D)  Extreme's Right to Excess Sales Proceeds.  If the cash price
               ----------------------------------------
actually paid by any third party purchasing the Property from BNPLC during
Extreme's Extended Remarketing Period, including any price paid by an Applicable
Purchaser purchasing from BNPLC pursuant to this Paragraph 2, exceeds the
Minimum Extended Remarketing Price (calculated as provided in subparagraph
2.(B), without reduction pursuant to subparagraph 2.(C)), then Extreme shall be
entitled to the excess; provided, that BNPLC may offset and retain from the
excess any and all sums that are then due and unpaid from Extreme to BNPLC under
any of the Operative Documents.

                                       6
<PAGE>

          (E)  Permitted Transfers During Extreme's Extended Remarketing Period.
               ----------------------------------------------------------------
Any "Permitted Transfer" described in clause (6) of the definition thereof in
                                      ----------
the Common Definitions and Provisions Agreement (Improvements) to an Affiliate
of BNPLC or that covers BNPLC's entire interest in the Improvements will be
subject to Extreme's Extended Remarketing Right if, at the time of the Permitted
Transfer, Extreme's Extended Remarketing Right has not expired or been
terminated as provided herein. Any other Permitted Transfer described in clause
(6) of the definition thereof, however, will not be subject to Extreme's
Extended Remarketing Right. Thus, for example, BNPLC's conveyance of a utility
easement or space lease more than thirty days after the Designated Sale Date to
a Person not an Affiliate of BNPLC shall not be subject to Extreme's Extended
Remarketing Right, though following the conveyance of the lesser estate,
Extreme's Extended Remarketing Right may continue to apply to BNPLC's remaining
interest in the Improvements and any Personal Property.

     3.   TERMS OF CONVEYANCE UPON PURCHASE. As necessary to consummate any sale
of the Property to Extreme or an Applicable Purchaser pursuant to this
Agreement, BNPLC must, subject to any postponement permitted by subparagraph
1.(C), promptly after the tender of the purchase price and any other payments to
BNPLC required pursuant to Paragraph 1 or Paragraph 2 (as applicable), and this
Paragraph 3 (as applicable), convey all of BNPLC's right, title and interest in
the Improvements and other Property to Extreme or the Applicable Purchaser, as
the case may be, by BNPLC's execution, acknowledgment (where appropriate) and
delivery of the Sale Closing Documents. Such conveyance by BNPLC will be subject
only to the Permitted Encumbrances and any other encumbrances that do not
constitute Liens Removable by BNPLC. However, such conveyance shall not include
the rights of BNPLC or other Interested Parties under the indemnities provided
in the Operative Documents, including rights to any payments then due from
Extreme under the indemnities or that may become due thereafter because of any
expense or liability incurred by BNPLC or another Interested Party resulting in
whole or in part from events or circumstances occurring or alleged to have
occurred before such conveyance. All costs, both foreseen and unforeseen, of any
purchase by Extreme or an Applicable Purchaser hereunder shall be the
responsibility of the purchaser. The Sale Closing Documents used to accomplish
such conveyance shall consist of the following: (1) a Corporation Grant Deed in
the form attached as Exhibit B-1 or Exhibit B-2 or Exhibit B-3, as required by
                     -----------    -----------    -----------
Exhibit B, (2) a Bill of Sale and Assignment in the form attached as Exhibit C,
---------                                                            ---------
(3) an Acknowledgment of Disclaimer of Representations and Warranties, in the
form attached as Exhibit D, which Extreme or the Applicable Purchaser must
                 ---------
execute and return to BNPLC, (4) a Secretary's Certificate in the form attached
as Exhibit E, and (5) a certificate concerning tax withholding in the form
   ---------
attached as Exhibit F. If for any reason BNPLC fails to tender the Sale Closing
            ---------
Documents as required by this Paragraph 3, BNPLC may cure such refusal at any
time before thirty days after receipt of a demand for such cure from Extreme.

     4    SURVIVAL AND TERMINATION OF THE RIGHTS AND OBLIGATIONS OF EXTREME AND
BNPLC.

          (A)  Status of this Agreement Generally. Except as expressly provided
               ----------------------------------
herein, this Agreement shall not terminate; nor shall Extreme have any right to
terminate this Agreement; nor shall Extreme be entitled to any reduction of the
Break Even Price, any Deficiency, the Maximum Remarketing Obligation, any
Supplemental Payment or the Minimum Extended Remarketing Price hereunder; nor
shall the obligations of Extreme to BNPLC under Paragraph 1 be affected, by
reason of (i) any damage to or the destruction of all or any part of the
Property from whatever cause (though it is understood that Extreme will receive
any remaining Escrowed Proceeds yet to be applied as provided in the
Improvements Lease that may result from such damage if Extreme purchases the
Property and the Escrowed Proceeds as herein provided), (ii) the taking of or
damage to the Property or any portion thereof by eminent domain or otherwise for
any reason (though it is understood that Extreme will receive any remaining
Escrowed Proceeds yet to be applied as provided in the Improvements Lease that
may result from such taking or damage if Extreme purchases the Property and the
Escrowed Proceeds as herein provided), (iii) the prohibition, limitation or
restriction of Extreme's use of all or any portion of the Property or any
interference with such use by governmental action or otherwise, (iv) any
eviction of Extreme or any party claiming under Extreme by paramount title or
otherwise, (v) Extreme's prior acquisition or ownership of any interest in the
Property, (vi) any default on the part of BNPLC under this Agreement, the
Improvements Lease or any other agreement to which

                                       7
<PAGE>

BNPLC is a party, or (vii) any other cause, whether similar or dissimilar to the
foregoing, any existing or future law to the contrary notwithstanding. It is the
intention of the parties hereto that the obligations of Extreme hereunder
(including the obligation to make any Supplemental Payment as provided in
Paragraph 1) shall be separate and independent covenants and agreements from
BNPLC's obligations under this Agreement or any other agreement between BNPLC
and Extreme; provided, however, that nothing in this subparagraph shall excuse
BNPLC from its obligation to tender the Sale Closing Documents in substantially
the form attached hereto as exhibits when required by Paragraph 3. Further,
nothing in this subparagraph shall be construed as a waiver by Extreme of any
right Extreme may have at law or in equity to the following remedies, whether
because of BNPLC's failure to remove a Lien Removable by BNPLC or because of any
other default by BNPLC under this Agreement: (i) the recovery of monetary
damages, (ii) injunctive relief in case of the violation, or attempted or
threatened violation, by BNPLC of any of the express covenants, agreements,
conditions or provisions of this Agreement which are binding upon BNPLC, or
(iii) a decree compelling performance by BNPLC of any of the express covenants,
agreements, conditions or provisions of this Agreement which are binding upon
BNPLC.

          (B)  Automatic Termination of Extreme's Rights. Without limiting
               -----------------------------------------
BNPLC's right to enforce Extreme's obligation to pay any Supplemental Payment or
other amounts required by this Agreement, the rights of Extreme (to be
distinguished from the obligations of Extreme) included in Extreme's Initial
Remarketing Rights and Obligations, the Purchase Option and Extreme's Extended
Remarketing Rights shall all terminate automatically if Extreme shall fail to
pay the full amount of any Supplemental Payment required by subparagraph
1.(A)(2)(c) on the Designated Sale Date or if BNPLC shall elect a Voluntary
Retention of the Property as provided in subparagraph 1.(A)(2)(a).
Notwithstanding anything in this subparagraph to the contrary, however, even
after a failure to pay any required Supplemental Payment on the Designated Sale
Date, Extreme may nonetheless tender to BNPLC the full Break Even Price and all
amounts then due under the Operative Documents, together with interest on the
total Break Even Price computed at the Default Rate from the Designated Sale
Date to the date of tender, on any Business Day within thirty days after the
Designated Sale Date, and if presented with such a tender within thirty days
after the Designated Sale Date, BNPLC must accept it and promptly thereafter
deliver any Escrowed Proceeds and the Sale Closing Documents listed in Paragraph
3 to Extreme.

          (C)  Termination of Extreme's Extended Remarketing Rights to Permit a
               ----------------------------------------------------------------
Sale by BNPLC. At any time more than ninety days after BNPLC has delivered a
-------------
Third Party Sale Notice to Extreme as described in subparagraph 2.(C)(2), BNPLC
may terminate Extreme's Extended Remarketing Rights contemporaneously with the
consummation of a sale of the Property by BNPLC to any third party (be it the
prospective purchaser named in the Third Party Sale Notice or another third
party) at a price equal to or in excess of the Third Party Target Price
specified in the Third Party Sale Notice, so as to permit the sale of the
Property unencumbered by Extreme's Extended Remarketing Rights.

          (D)  Payment Only to BNPLC. All amounts payable under this Agreement
               ---------------------
by Extreme and, if applicable, by an Applicable Purchaser must be paid directly
to BNPLC, and no payment to any other party shall be effective for the purposes
of this Agreement. In addition to the payments required under subparagraph
1.(A), on the Designated Sale Date Extreme must pay all amounts then due to
BNPLC under the Land Lease or other Operative Documents. This subparagraph shall
not, however, be construed to limit Extreme's right to require the deduction of
Direct Payments to Participants and Deposit Taker Losses in the calculation of
the Break Even Price as provided in subparagraph 1.(B)(1).

     In additional to the payments required under subparagraph 1.(A), on the
Designated Sale Date Extreme must pay all amounts then due to BNPLC under the
Improvements Lease or other Operative Documents.

          (E)  Remedies Under the Other Operative Documents. No repossession of
               --------------------------------------------
or re-entering upon the Property or exercise of any other remedies available to
BNPLC under the Land Lease or other Operative Documents shall terminate
Extreme's rights or obligations hereunder, all of which shall survive BNPLC's
exercise of remedies under the other Operative Documents. Extreme acknowledges
that the consideration for this Agreement is separate and independent of the
consideration for the Land Lease and the Closing

                                       8
<PAGE>

Certificate, and Extreme's obligations hereunder shall not be affected or
impaired by any event or circumstance that would excuse Extreme from performance
of its obligations under such other Operative Documents.

          (F)  Occupancy by Extreme Prior to Closing of a Sale. Prior to the
               -----------------------------------------------
closing of any sale of the Property to Extreme or an Applicable Purchaser
hereunder, Extreme's occupancy of the Land and its use of the Property shall
continue to be subject to the terms and conditions of the Land Lease, including
the terms setting forth Extreme's obligation to pay rent, prior to any
termination or expiration of the Land Lease pursuant to its express terms and
conditions.

     5    SECURITY FOR EXTREME'S OBLIGATIONS; RETURN OF FUNDS. Extreme's
obligations under this Agreement are secured by the Pledge Agreement, reference
to which is hereby made for a description of the Collateral covered thereby and
the rights and remedies provided to BNPLC thereby. Although the collateral agent
appointed for BNPLC as provided in the Pledge Agreement shall be entitled to
hold all Collateral as security for the full and faithful performance by Extreme
of Extreme's covenants and obligations under this Agreement, the Collateral
shall not be considered an advance payment of the Break Even Price or any
Supplemental Payment or a measure of BNPLC's damages should Extreme breach this
Agreement. If Extreme does breach this Agreement and fails to cure the same
within any time specified herein for the cure, BNPLC may, from time to time,
without prejudice to any other remedy and without notice to Extreme, require the
collateral agent to immediately apply the proceeds of any disposition of the
Collateral (and any cash included in the Collateral) to amounts then due
hereunder from Extreme. If by a Permitted Transfer BNPLC conveys its interest in
the Property before the Designated Sale Date, BNPLC may also assign BNPLC's
interest in the Collateral to the transferee. BNPLC shall be entitled to return
any Collateral not sold or used to satisfy the obligations secured by the Pledge
Agreement directly to Extreme notwithstanding any prior actual or attempted
conveyance or assignment by Extreme, voluntary or otherwise, of any right to
receive the same; neither BNPLC nor the collateral agent named in the Pledge
Agreement shall be responsible for the proper distribution or application by
Extreme of any such Collateral returned to Extreme; and any such return of
Collateral to Extreme shall discharge any obligation of BNPLC to deliver such
Collateral to all Persons claiming an interest in the Collateral. Further, BNPLC
shall be entitled to deliver any Escrowed Proceeds it holds on the Designated
Sale Date directly to Extreme or to any Applicable Purchaser purchasing BNPLC's
interest in the Property and the Escrowed Proceeds pursuant to this Agreement
notwithstanding any prior actual or attempted conveyance or assignment by
Extreme, voluntary or otherwise, of any right to receive the same; BNPLC shall
not be responsible for the proper distribution or application by Extreme or any
Applicable Purchaser of any such Escrowed Proceeds paid over to Extreme or the
Applicable Purchaser; and any such payment of Escrowed Proceeds to Extreme or an
Applicable Purchaser shall discharge any obligation of BNPLC to deliver the same
to all Persons claiming an interest therein.

     6    CERTAIN REMEDIES CUMULATIVE. No right or remedy herein conferred upon
or reserved to BNPLC is intended to be exclusive of any other right or remedy
BNPLC has with respect to the Property, 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 at law or in equity or by statute. In addition to
other remedies available under this Agreement, either party shall be entitled,
to the extent permitted by applicable law, to a decree compelling performance of
any of the other party's agreements hereunder.

     7    ATTORNEYS' FEES AND LEGAL EXPENSES. If either party to this Agreement
commences any legal action or other proceeding to enforce any of the terms of
this Agreement, or because of any breach by the other party or dispute
hereunder, the party prevailing in such action or proceeding shall be entitled
to recover from the other party all Attorneys' Fees incurred in connection
therewith, whether or not such controversy, claim or dispute is prosecuted to a
final judgment. Any such Attorneys' Fees incurred by either party in enforcing a
judgment in its favor under this Agreement shall be recoverable separately from
such judgment, and the obligation for such Attorneys' Fees is intended to be
severable from other provisions of this Agreement and not to be merged into any
such judgment.

                                       9
<PAGE>

     8    ESTOPPEL CERTIFICATE. Upon request by BNPLC, Extreme shall execute,
acknowledge and deliver a written statement certifying that this Agreement is
unmodified and in full effect (or, if there have been modifications, that this
Agreement is in full effect as modified, and setting forth such modification)
and either stating that no default exists hereunder or specifying each such
default of which Extreme has knowledge. Any such statement may be relied upon by
any Participant or prospective purchaser or assignee of BNPLC with respect to
the Property.

     9    SUCCESSORS AND ASSIGNS. The terms, provisions, covenants and
conditions hereof shall be binding upon Extreme and BNPLC and their respective
permitted successors and assigns and shall inure to the benefit of Extreme and
BNPLC and all permitted transferees, mortgagees, successors and assignees of
Extreme and BNPLC with respect to the Property; provided, that (A) the rights of
BNPLC hereunder shall not pass to Extreme or any Applicable Purchaser or any
subsequent owner claiming through Extreme or an Applicable Purchaser, (B) BNPLC
shall not assign this Agreement or any rights hereunder except pursuant to a
Permitted Transfer, and (C) Extreme shall not assign this Agreement or any
rights hereunder without the prior written consent of BNPLC.

                           [Signature pages follow.]

                                      10
<PAGE>

     IN WITNESS WHEREOF, Extreme and BNPLC have caused this Agreement to be
executed as of June 1, 2000.


                                             "Extreme"

                                             EXTREME NETWORKS, INC.


                                             By:  ___________________________
                                                  Name:______________________
                                                  Title:_____________________
<PAGE>

[Continuation of signature pages to Purchase Agreement (Land) dated to be
effective June 1, 2000]


                                             "BNPLC"

                                             BNP LEASING CORPORATION

                                             By:  ______________________________
                                                  Lloyd G. Cox, Vice President
<PAGE>

                                   Exhibit A
                                   ---------

                               LEGAL DESCRIPTION

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.
<PAGE>

                                   Exhibit B
                                   ---------

             Requirements Re: Form of Grant Deed and Ground Lease

The form of deed to be used to convey BNPLC's interest in the Land to Extreme or
an Applicable Purchaser will depend upon whether BNPLC's interest in the
Improvements has been or is being conveyed at the same time to the same party.

If BNPLC's interests in both the Land and the Improvements are to be conveyed to
Extreme or an Applicable Purchaser at the same time, because a sale under this
Purchase Agreement and a sale under the Other Purchase Agreement (covering the
Improvements) are being consummated at the same time and to the same party, then
the one deed in form attached as Exhibit B-1 will be used to convey both.
                                 -----------

If, however, a sale of BNPLC's interest in the Improvements pursuant to the
Other Purchase Agreement has not been consummated before, and is not being
consummated contemporaneously with the sale of BNPLC's interest in the Land
under this Agreement, then BNPLC's interest in the Land will be conveyed by a
deed in the from attached as Exhibit B-2, and BNPLC and the grantee under such
deed shall, as a condition to BNPLC's obligation to deliver the deed, execute
and deliver a Ground Lease covering the Land in the form attached hereto as
Exhibit B-3.
-----------

Finally, BNPLC's interest in the Land will be conveyed by a deed in the from
attached as Exhibit B-4 if BNPLC's interest in the Improvements has been sold
pursuant to the Other Purchase Agreement before a sale of BNPLC's interest in
the Land under this Agreement, or if BNPLC's interest in the Improvements is
being sold contemporaneously with a sale of BNPLC's interest in the Land, but
the purchaser of the Improvements is not the same as the purchaser of the Land.
<PAGE>

                                  Exhibit B-1
                                  -----------

                            CORPORATION GRANT DEED

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
-------------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:  _____________________________
ATTN:     _____________________________
CITY:     _____________________________
STATE: ________________________________
Zip:      _____________________________

MAIL TAX STATEMENTS TO:
----------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:  _____________________________
ATTN:     _____________________________
CITY:     _____________________________
STATE: ________________________________
Zip:      _____________________________


                            CORPORATION GRANT DEED
                       (Covering Land and Improvements)

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, BNP
LEASING CORPORATION, a Delaware corporation ("Grantor"), hereby grants to
[Extreme or the Applicable Purchaser] ("Grantee") all of Grantor's interest in
the land situated in Santa Clara, California, described on Annex A attached
hereto and hereby made a part hereof and all improvements on such land, together
with the any other right, title and interest of Grantor in and to any easements,
rights-of-way, privileges and other rights appurtenant to such land or the
improvements thereon; provided, however, that this grant is subject to the
encumbrances described on Annex B (the "Permitted Encumbrances"). Grantee hereby
assumes the obligations (including any personal obligations) of Grantor, if any,
created by or under, and agrees to be bound by the terms and conditions of, the
Permitted Encumbrances to the extent that the same concern or apply to the land
or improvements conveyed by this deed.
<PAGE>

                                             BNP LEASING CORPORATION

Date: As of_____________                     By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

                                             [Extreme or Applicable Purchaser]


Date: As of_____________                     By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

STATE OF _____________    )
                          )   SS
COUNTY OF _____________   )


     On___________________ before me,_________, personally appeared _________
and________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.

     Signature________________________________

                             Exhibit B-1 - Page 2
<PAGE>

STATE OF _____________    )
                          )   SS
COUNTY OF _____________   )



     On___________________ before me,_________, personally appeared _________
and____________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.


     Signature____________________________

                             Exhibit B-1 - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION

[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
---------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DEED TO WHICH THIS DESCRIPTION IS ATTACHED IS
ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.


                             Exhibit B-1 - Page 4
<PAGE>

                                    Annex B

                            Permitted Encumbrances

[DRAFTING NOTE: TO THE EXTENT THAT ENCUMBRANCES (OTHER THAN "LIENS REMOVABLE BY
---------------
BNPLC") ARE IDENTIFIED IN ADDITION TO THOSE DESCRIBED BELOW, SUCH ADDITIONAL
ENCUMBRANCES WILL BE ADDED TO THE LIST BELOW AND THIS "DRAFTING NOTE" WILL BE
DELETED BEFORE THIS DEED IS ACTUALLY EXECUTED AND DELIVERED BY BNPLC. SUCH
ADDITIONAL ENCUMBRANCES WOULD INCLUDE ANY NEW ENCUMBRANCES APPROVED BY BNPLC AS
"PERMITTED ENCUMBRANCES" UNDER THE LAND LEASE OR THE OTHER LEASE AGREEMENT FROM
TIME TO TIME OR BECAUSE OF EXTREME'S REQUEST FOR BNPLC'S CONSENT OR APPROVAL TO
AN ADJUSTMENT.]

     This conveyance is subject to all encumbrances not constituting a "Lien
Removable by BNPLC" (as defined in the Common Definitions and Provisions
Agreement (Land) incorporated by reference into the Lease Agreement (Land)
referenced in the last item of the list below), including the following matters
to the extent the same are still valid and in force:

1.   TAXES for the fiscal year 2000-2001, a lien not yet due or payable.

2.   The lien of supplemental taxes, if any, assessed pursuant to the provisions
     of Chapter 3.5, (commencing with Section 75) to the Revenue and Taxation
     Code of the State of California.

3.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara
     For:      electric wire overhang purposes
     Recorded: November 28, 1960 in Book 4995, Page 160, Official Records
     Affects:  Northerly 5 feet of said land, and as shown on the survey
               prepared by Anthony C. McCants, L.S. 5944, dated April 27, 2000,
               revised May 22, 2000

4.   The fact that the ownership of said land does not include any right of
     ingress or egress to or from Lawrence Expressway contiguous thereto, said
     right having been relinquished by deed,
     From:  Jefferson Union Elementary School District of the County of Santa
            Clara
     To:    County of Santa Clara, State of California
     Recorded:  June 4, 1965 in Book 6982, Page 1, Official Records

     Said land, however, abuts on a public street other than the one referred to
     above, over which rights of vehicular access have not been relinquished.

5.   An Agreement, affecting said land, for the purposes stated herein and
     subject to the terms, covenants, conditions, restrictions, and easements,
     if any, contained therein
     For:      Postponed Traffic Signal Improvements
     Dated:    October 4, 1983
     Executed by:   City of Santa Clara, California, a municipal corporation and
                    MPJ, a California partnership
     Recorded:      November 16, 1983 in Book I 070, Page 333, Official Records.

6.   An easement affecting the portion of said land and for the purpose stated
     herein and incidental purposes,
     In Favor Of:   City of Santa Clara, a municipal corporation
     For:      roadway purposes and public utilities
     Recorded:      November 30, 1983 in Book I 111, Page 606, Official Records
     Affects:A portion of that certain 24.740 acre parcel of land as shown on
                    that certain Record of Survey filed for record in Book 447
                    of Maps, at page 33, Santa Clara County Records, described
                    as

                         Exhibit B-1 - Page 5 follows:
<PAGE>

                         follows:

         Beginning at a point in the Northerly line of Monroe Avenue, as shown
         on said map at the Westerly terminus of the course shown as N. 89
         degrees 25 minutes 00 seconds E. 760.70; thence from said point of
         beginning along said Northerly line N. 89 degrees 25 minutes 00 seconds
         E. 760.70 feet and N. 2.00 feet; thence leaving said Northerly line
         along a line parallel with said course of N. 89 degrees 25 minutes 00
         seconds E.; S. 89 degrees 25 minutes 00 seconds W. 334.99 feet; thence
         leaving said parallel line N. 87 degrees 09 minutes 00 seconds W. 66.79
         feet; thence along a line parallel with said course N. 89 degrees 25
         minutes 00 seconds E.; S. 89 degrees 25 minutes 00 seconds W. 359.00
         feet; thence leaving said Westerly line along a tangent curve to the
         right, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to a
         point of cusp in the Westerly line of said 24.740 acre parcel; thence
         along said Westerly line S. 0 degrees 00 minutes 27 seconds E. 6.00
         feet; thence leaving said Westerly line along a tangent curve to the
         left, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to the
         point of beginning, and as shown on the survey prepared by Anthony C.
         McCants, L.S. 5944, dated April 27, 2000, revised May 22, 2000.

7.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of: City of Santa Clara, a municipal corporation
         For:   underground electrical distribution and/or communication systems
         Recorded:    May 17, 1984 in Book I 552, Page 595, Official Records
         Affects. as follows:

         Parcel 1:

         Commencing at the point of intersection of the Westerly line of that
         certain 24.74 acre parcel of land shown upon that Record of Survey
         filed for recorded August 10, 1979 in Book 447 of Maps, at page 33,
         Santa Clara County Records, with a line parallel with and 10 feet
         Southerly of, measured at right angles to, the Northerly line of said
         parcel; thence along said parallel line N. 89 degrees 25 minutes 00
         seconds E. 107.00 feet; thence parallel with said Westerly line S. 0
         degrees 00 minutes 27 seconds E. 319.16 feet; thence S. 34 degrees 02
         minutes 45 seconds W. 87.51 feet, more or less, to intersection with a
         line parallel with and 58 feet Easterly of measured at right angles to,
         said Westerly line; thence along last said parallel line S. 0 degrees
         00 minutes 27 seconds E. 294.30 feet, more or less, to intersection
         with a line parallel with and 5 feet Northerly of, measured at right
         angles to, the Northerly line of that real property conveyed to the
         City of Santa Clara by that deed filed for record November 30, 1983 in
         Book I 111 of Official Records, at page 606, said County Records;
         thence along last said parallel line the following three (3) courses:
         N. 89 degrees 25 minutes 00 seconds E. 351.81 feet; S. 87 degrees 09
         minutes 00 seconds E. 66.79 feet; N. 89 degrees 25 minutes 00 seconds
         E. 334.69 feet; thence continuing parallel with the Southerly line of
         first said parcel N. 89 degrees 25 minutes 00 seconds E. 181.89 feet,
         more or less, to termination in the Easterly line of that certain
         parcel of real property conveyed to MPJ Partnership, by that Grant Deed
         filed for record August 25, 1983 in Book H 838 of Official Records, at
         page 215, said County Records.

         Parcel 2:

         A portion of said 24.74 acre parcel of land contiguous to and Northerly
         of said real property conveyed by deed recorded in Book I 111, at page
         606, contiguous to and Westerly of hereinabove described strip of land
         and bounded on the North by a line parallel with and 5 feet Northerly
         of, measured at right angles to, that course N. 89 degrees 25 minutes
         00 seconds E. 351.81 feet in the hereinabove described centerline.

         Parcel 3:

         A strip of land 10 feet in width and 30 feet in length of centerline of
         said strip being parallel with and 325.5 feet Southerly of, measured at
         right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on

                             Exhibit B-1 - Page 6
<PAGE>

         the West in the Easterly line of first hereinabove described strip;
         thence continuing Easterly along last said parallel line for a distance
         of 15 feet, as the centerline of a strip of land 15 feet in width, to
         termination of said centerline and strip.

         Parcel 4:

         A strip of land 10 feet in width and 12 feet in length the centerline
         of said strip being parallel with and 116.5 feet Southerly of, measured
         at right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on the West in the Easterly line of first hereinabove
         described strip; thence continuing Easterly along last said parallel
         line for a distance of 15 feet in width, lying 5 feet Northerly and 10
         feet Southerly of said parallel line to the Easterly terminus of said
         strip.

         Parcel 5:

         A strip of land 10 feet in width, the centerline of said strip being
         described as follows:

         Commencing at the point of intersection of the Northerly line of first
         hereinabove described strip of land with a line parallel with and 824.5
         feet Easterly of, measured at right angles to, that course in the
         Westerly boundary of said 24.75 acre parcel bearing N. 0 degrees 00
         minutes 27 seconds W.; thence along last said parallel line N. 0
         degrees 00 minutes 27 seconds W. 367.96 feet, more or less, to a line
         parallel with and 327 feet Southerly of, measured at right angles to,
         said Northerly line of the 24.74 acre parcel; thence along last said
         parallel line S. 89 degrees 25 minutes 00 seconds W. 78 feet to a line
         parallel with and 746.5 feet Easterly of, measured at right angles to,
         said Westerly line of the 24.74 acre parcel; thence along last said
         parallel line N. 0 degrees 00 minutes 27 seconds W. 203 feet; thence
         continuing as the centerline of a strip of land 15 feet in width N. 0
         degrees 00 minutes 27 seconds W. 15 feet, more or less, to termination
         of said strip and centerline in a line parallel with and 109 feet
         Southerly of, measured at right angles to, last said Northerly line.

         Parcel 6:

         A 15 foot square parcel of land contiguous to and Southerly of last
         hereinabove described 10 foot wide strip of land and centered on the
         Southerly prolongation of hereinabove mentioned course N. 0 degrees 00
         minutes 27 seconds W. 203 feet, and as shown on the survey prepared by
         Anthony C. McCants, L.S. 5944, dated April 27, 2000, revised May 22,
         2000.

8.       Lease Agreement (Land) dated as of June 1, 2000, by and between BNP
         Leasing Corporation, as lessor, and Extreme Networks, Inc., as lessee,
         and Lease Agreement (Improvements) dated as of June 1, 2000, by and
         between BNP Leasing Corporation, as lessor, and Extreme Networks, Inc.,
         as lessee.

                             Exhibit B-1 - Page 7
<PAGE>

                                  Exhibit B-2
                                  -----------

                            CORPORATION GRANT DEED


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
-------------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:       ___________________
ATTN:          ___________________
CITY:          ___________________
STATE:   ___________________
Zip:           ___________________

MAIL TAX STATEMENTS TO:
----------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:       ___________________
ATTN:          ___________________
CITY:          ___________________
STATE:   ___________________
Zip:           ___________________

                            CORPORATION GRANT DEED
        (Covering Improvements but not the Land under the Improvements)

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, BNP
LEASING CORPORATION, a Delaware corporation ("Grantor"), hereby grants to
[Extreme or the Applicable Purchaser] ("Grantee") all of Grantor's interest in
the buildings and other improvements (the "Improvements") on the land situated
in Santa Clara, California, described on Annex A attached hereto and hereby made
a part hereof (the "Land"), together with the any other right, title and
interest of Grantor in and to any easements, rights-of-way, privileges and other
rights appurtenant to the Improvements; provided, however, that this grant is
subject to the encumbrances described on Annex B (the "Permitted Encumbrances")
and any reservations or qualifications set forth below. Grantee hereby assumes
the obligations (including any personal obligations) of Grantor, if any, created
by or under, and agrees to be bound by the terms and conditions of, the
Permitted Encumbrances to the extent that the same concern or apply to the
Improvements.

Although this deed conveys Grantor's interest in the Improvements, this deed
does not convey any interest in the Land under the Improvements or any rights or
easements appurtenant to Improvements. Grantor retains and reserves all right,
title and interest of Grantor in and to the Land and any rights and easements
appurtenant to Land. Further, this deed does not convey any right of access over
or right to use the Land, it being understood that the right of Grantee or its
successors and assigns to maintain or use the improvements conveyed hereby shall
be on and subject to the terms and conditions of any separate ground lease or
deed that Grantee may from time to time obtain from the owner of the Land. If
Grantee does not obtain a separate deed or ground lease giving Grantee the
authority to maintain the Improvements on the Land, Grantee shall remove or
abandon the Improvements promptly upon request of the owner of the Land. Nothing
herein or in the agreements pursuant to which this deed is being delivered shall
be construed as an obligation on the part of Grantor to deliver or cooperate
reasonably in obtaining for Grantee any deed or ground lease covering the Land
described on Annex A.
<PAGE>

                                             BNP LEASING CORPORATION

Date: As of ____________                     By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

                                             [Extreme or Applicable Purchaser]


Date: As of ____________                     By:     ___________________________
                                                     Its:

                                             Attest: ___________________________
                                                     Its:

STATE OF ____________      )
                           )       SS
COUNTY OF ___________      )


     On ___________________ before me,__________, personally appeared __________
and ______________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.



     Signature _______________________________

                             Exhibit B-2 - Page 2
<PAGE>

STATE OF ____________      )
                           )       SS
COUNTY OF ___________      )


     On ___________________ before me, ___________, personally appeared ________
and ____________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.



     Signature ______________________________

                             Exhibit B-2 - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION


[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
 --------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DEED TO WHICH THIS DESCRIPTION IS ATTACHED IS
ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

                             Exhibit B-2 - Page 4
<PAGE>

                                    Annex B

                            Permitted Encumbrances

[DRAFTING NOTE: TO THE EXTENT THAT ENCUMBRANCES (OTHER THAN "LIENS REMOVABLE BY
 --------------
BNPLC") ARE IDENTIFIED IN ADDITION TO THOSE DESCRIBED BELOW, SUCH ADDITIONAL
ENCUMBRANCES WILL BE ADDED TO THE LIST BELOW AND THIS "DRAFTING NOTE" WILL BE
DELETED BEFORE THIS DEED IS ACTUALLY EXECUTED AND DELIVERED BY BNPLC. SUCH
ADDITIONAL ENCUMBRANCES WOULD INCLUDE ANY NEW ENCUMBRANCES APPROVED BY BNPLC AS
"PERMITTED ENCUMBRANCES" UNDER THE LAND LEASE OR THE OTHER LEASE AGREEMENT FROM
TIME TO TIME OR BECAUSE OF EXTREME'S REQUEST FOR BNPLC'S CONSENT OR APPROVAL TO
AN ADJUSTMENT.]

         This conveyance is subject to all encumbrances not constituting a "Lien
Removable by BNPLC" (as defined in the Common Definitions and Provisions
Agreement (Improvements) incorporated by reference into the Lease Agreement
(Improvements) referenced in the last item of the list below), including the
following matters to the extent the same are still valid and in force:

1.       TAXES for the fiscal year 2000-2001, a lien not yet due or payable.

2.       The lien of supplemental taxes, if any, assessed pursuant to the
         provisions of Chapter 3.5, (commencing with Section 75) to the Revenue
         and Taxation Code of the State of California.

3.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of: City of Santa Clara
         For:     electric wire overhang purposes
         Recorded:    November 28, 1960 in Book 4995, Page 160, Official Records
         Affects: Northerly 5 feet of said land, and as shown on the survey
                      prepared by Anthony C. McCants, L.S. 5944, dated
                      April 27, 2000, revised May 22, 2000

4.       The fact that the ownership of said land does not include any right of
         ingress or egress to or from Lawrence Expressway contiguous thereto,
         said right having been relinquished by deed,
         From: Jefferson Union Elementary School District of the County of Santa
               Clara
         To:   County of Santa Clara, State of California
         Recorded:  June 4, 1965 in Book 6982, Page 1, Official Records

         Said land, however, abuts on a public street other than the one
         referred to above, over which rights of vehicular access have not been
         relinquished.

5.       An Agreement, affecting said land, for the purposes stated herein and
         subject to the terms, covenants, conditions, restrictions, and
         easements, if any, contained therein
         For:     Postponed Traffic Signal Improvements
         Dated:   October 4, 1983
         Executed by: City of Santa Clara, California, a municipal corporation
         and MPJ, a California partnership
         Recorded:    November 16, 1983 in Book I 070, Page 333, Official
                      Records.

6.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,

         In Favor Of: City of Santa Clara, a municipal corporation
         For:     roadway purposes and public utilities
         Recorded:    November 30, 1983 in Book I 111, Page 606, Official
                      Records
         Affects: A portion of that certain 24.740 acre parcel of land as shown
                      on that certain Record of Survey filed for record in Book
                      447 of Maps, at page 33, Santa Clara County Records,
                      described as

                             Exhibit B-2 - Page 5
<PAGE>

                    follows:

         Beginning at a point in the Northerly line of Monroe Avenue, as shown
         on said map at the Westerly terminus of the course shown as N. 89
         degrees 25 minutes 00 seconds E. 760.70; thence from said point of
         beginning along said Northerly line N. 89 degrees 25 minutes 00 seconds
         E. 760.70 feet and N. 2.00 feet; thence leaving said Northerly line
         along a line parallel with said course of N. 89 degrees 25 minutes 00
         seconds E.; S. 89 degrees 25 minutes 00 seconds W. 334.99 feet; thence
         leaving said parallel line N. 87 degrees 09 minutes 00 seconds W. 66.79
         feet; thence along a line parallel with said course N. 89 degrees 25
         minutes 00 seconds E.; S. 89 degrees 25 minutes 00 seconds W. 359.00
         feet; thence leaving said Westerly line along a tangent curve to the
         right, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to a
         point of cusp in the Westerly line of said 24.740 acre parcel; thence
         along said Westerly line S. 0 degrees 00 minutes 27 seconds E. 6.00
         feet; thence leaving said Westerly line along a tangent curve to the
         left, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to the
         point of beginning, and as shown on the survey prepared by Anthony C.
         McCants, L.S. 5944, dated April 27, 2000, revised May 22, 2000.

7.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of: City of Santa Clara, a municipal corporation
         For:   underground electrical distribution and/or communication systems
         Recorded:    May 17, 1984 in Book I 552, Page 595, Official Records
         Affects. as follows:

         Parcel 1:

         Commencing at the point of intersection of the Westerly line of that
         certain 24.74 acre parcel of land shown upon that Record of Survey
         filed for recorded August 10, 1979 in Book 447 of Maps, at page 33,
         Santa Clara County Records, with a line parallel with and 10 feet
         Southerly of, measured at right angles to, the Northerly line of said
         parcel; thence along said parallel line N. 89 degrees 25 minutes 00
         seconds E. 107.00 feet; thence parallel with said Westerly line S. 0
         degrees 00 minutes 27 seconds E. 319.16 feet; thence S. 34 degrees 02
         minutes 45 seconds W. 87.51 feet, more or less, to intersection with a
         line parallel with and 58 feet Easterly of measured at right angles to,
         said Westerly line; thence along last said parallel line S. 0 degrees
         00 minutes 27 seconds E. 294.30 feet, more or less, to intersection
         with a line parallel with and 5 feet Northerly of, measured at right
         angles to, the Northerly line of that real property conveyed to the
         City of Santa Clara by that deed filed for record November 30, 1983 in
         Book I 111 of Official Records, at page 606, said County Records;
         thence along last said parallel line the following three (3) courses:
         N. 89 degrees 25 minutes 00 seconds E. 351.81 feet; S. 87 degrees 09
         minutes 00 seconds E. 66.79 feet; N. 89 degrees 25 minutes 00 seconds
         E. 334.69 feet; thence continuing parallel with the Southerly line of
         first said parcel N. 89 degrees 25 minutes 00 seconds E. 181.89 feet,
         more or less, to termination in the Easterly line of that certain
         parcel of real property conveyed to MPJ Partnership, by that Grant Deed
         filed for record August 25, 1983 in Book H 838 of Official Records, at
         page 215, said County Records.

         Parcel 2:

         A portion of said 24.74 acre parcel of land contiguous to and Northerly
         of said real property conveyed by deed recorded in Book I 111, at page
         606, contiguous to and Westerly of hereinabove described strip of land
         and bounded on the North by a line parallel with and 5 feet Northerly
         of, measured at right angles to, that course N. 89 degrees 25 minutes
         00 seconds E. 351.81 feet in the hereinabove described centerline.

         Parcel 3:

         A strip of land 10 feet in width and 30 feet in length of centerline of
         said strip being parallel with and 325.5 feet Southerly of, measured at
         right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on

                             Exhibit B-2 - Page 6
<PAGE>

         the West in the Easterly line of first hereinabove described strip;
         thence continuing Easterly along last said parallel line for a distance
         of 15 feet, as the centerline of a strip of land 15 feet in width, to
         termination of said centerline and strip.

         Parcel 4:

         A strip of land 10 feet in width and 12 feet in length the centerline
         of said strip being parallel with and 116.5 feet Southerly of, measured
         at right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on the West in the Easterly line of first hereinabove
         described strip; thence continuing Easterly along last said parallel
         line for a distance of 15 feet in width, lying 5 feet Northerly and 10
         feet Southerly of said parallel line to the Easterly terminus of said
         strip.

         Parcel 5:

         A strip of land 10 feet in width, the centerline of said strip being
         described as follows:

         Commencing at the point of intersection of the Northerly line of first
         hereinabove described strip of land with a line parallel with and 824.5
         feet Easterly of, measured at right angles to, that course in the
         Westerly boundary of said 24.75 acre parcel bearing N. 0 degrees 00
         minutes 27 seconds W.; thence along last said parallel line N. 0
         degrees 00 minutes 27 seconds W. 367.96 feet, more or less, to a line
         parallel with and 327 feet Southerly of, measured at right angles to,
         said Northerly line of the 24.74 acre parcel; thence along last said
         parallel line S. 89 degrees 25 minutes 00 seconds W. 78 feet to a line
         parallel with and 746.5 feet Easterly of, measured at right angles to,
         said Westerly line of the 24.74 acre parcel; thence along last said
         parallel line N. 0 degrees 00 minutes 27 seconds W. 203 feet; thence
         continuing as the centerline of a strip of land 15 feet in width N. 0
         degrees 00 minutes 27 seconds W. 15 feet, more or less, to termination
         of said strip and centerline in a line parallel with and 109 feet
         Southerly of, measured at right angles to, last said Northerly line.

         Parcel 6:

         A 15 foot square parcel of land contiguous to and Southerly of last
         hereinabove described 10 foot wide strip of land and centered on the
         Southerly prolongation of hereinabove mentioned course N. 0 degrees 00
         minutes 27 seconds W. 203 feet, and as shown on the survey prepared by
         Anthony C. McCants, L.S. 5944, dated April 27, 2000, revised May 22,
         2000.

8.       Lease Agreement (Land) dated as of June 1, 2000, by and between BNP
         Leasing Corporation, as lessor, and Extreme Networks, Inc., as lessee,
         and Lease Agreement (Improvements) dated as of June 1, 2000, by and
         between BNP Leasing Corporation, as lessor, and Extreme Networks, Inc.,
         as lessee.

                             Exhibit B-2 - Page 7
<PAGE>

                                  Exhibit B-3
                                  -----------

                            CORPORATION GRANT DEED


RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
-------------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:       ___________________
ATTN:          ___________________
CITY:          ___________________
STATE:   ___________________
Zip:           ___________________

MAIL TAX STATEMENTS TO:
----------------------

NAME: [Extreme or the Applicable Purchaser]
ADDRESS:       ___________________
ATTN:          ___________________
CITY:          ___________________
STATE:   ___________________
Zip:           ___________________

                            CORPORATION GRANT DEED
          (Covering Improvements but not Land under the Improvements)

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, BNP
LEASING CORPORATION, a Delaware corporation ("Grantor"), hereby grants to
[Extreme or the Applicable Purchaser] ("Grantee") all of Grantor's interest in
the buildings and other improvements (the "Improvements") on the land situated
in Santa Clara, California, described on Annex A attached hereto and hereby made
a part hereof (the "Land"), together with the any other right, title and
interest of Grantor in and to any easements, rights-of-way, privileges and other
rights appurtenant to the Improvements; provided, however, that this grant is
subject to the encumbrances described on Annex B (the "Permitted Encumbrances")
and any reservations or qualifications set forth below. Grantee hereby assumes
the obligations (including any personal obligations) of Grantor, if any, created
by or under, and agrees to be bound by the terms and conditions of, the
Permitted Encumbrances to the extent that the same concern or apply to the
Improvements.

Although this deed conveys Grantor's interest in the Improvements on the Land,
this deed does not convey any interest in the Land itself or any rights or
easements appurtenant to Land. Prior to or contemporaneously with the delivery
of this deed, Grantor has conveyed or is conveying the Land and appurtenant
rights and easements to another party, subject to the terms and conditions of a
Ground Lease dated ________, filed or to be filed for record in the Santa Clara
County records. Grantor is assigning it's rights as lessee under the Ground
Lease to Grantee by a separate instrument dated of even date herewith.
<PAGE>

                                        BNP LEASING CORPORATION

Date: As of ____________                By:     ________________________________
                                                Its:

                                        Attest: ________________________________
                                                Its:

                                        [Extreme or Applicable Purchaser]


Date: As of ____________                By:     ________________________________
                                                Its:

                                        Attest: ________________________________
                                                Its:

STATE OF ____________      )
                           )       SS
COUNTY OF ___________      )


     On ___________________ before me,_________, personally appeared ___________
and _____________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.



     Signature _________________________________

                             Exhibit B-3 - Page 2
<PAGE>

STATE OF ____________      )
                           )       SS
COUNTY OF ___________      )


     On ___________________ before me, ___________, personally appeared ________
and __________, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the persons whose names are subscribed to the
within instrument and acknowledged to me that they executed the same in their
authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

     WITNESS my hand and official seal.




     Signature _______________________________

                             Exhibit B-3 - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION


[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE LAND LEASE CHANGES
 --------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DEED TO WHICH THIS DESCRIPTION IS ATTACHED IS
ACTUALLY EXECUTED AND DELIVERED.]


All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

                             Exhibit B-3 - Page 4
<PAGE>

                                    Annex B

                            Permitted Encumbrances

[DRAFTING NOTE: TO THE EXTENT THAT ENCUMBRANCES (OTHER THAN "LIENS REMOVABLE BY
 --------------
BNPLC") ARE IDENTIFIED IN ADDITION TO THOSE DESCRIBED BELOW, SUCH ADDITIONAL
ENCUMBRANCES WILL BE ADDED TO THE LIST BELOW AND THIS "DRAFTING NOTE" WILL BE
DELETED BEFORE THIS DEED IS ACTUALLY EXECUTED AND DELIVERED BY BNPLC. SUCH
ADDITIONAL ENCUMBRANCES WOULD INCLUDE ANY NEW ENCUMBRANCES APPROVED BY BNPLC AS
"PERMITTED ENCUMBRANCES" UNDER THE LAND LEASE OR THE OTHER LEASE AGREEMENT FROM
TIME TO TIME OR BECAUSE OF EXTREME'S REQUEST FOR BNPLC'S CONSENT OR APPROVAL TO
AN ADJUSTMENT.]

         This conveyance is subject to all encumbrances not constituting a "Lien
Removable by BNPLC" (as defined in the Common Definitions and Provisions
Agreement (Improvements) incorporated by reference into the Lease Agreement
(Improvements) referenced in the last item of the list below), including the
following matters to the extent the same are still valid and in force:

1.       TAXES for the fiscal year 2000-2001, a lien not yet due or payable.

2.       The lien of supplemental taxes, if any, assessed pursuant to the
         provisions of Chapter 3.5, (commencing with Section 75) to the Revenue
         and Taxation Code of the State of California.

3.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of: City of Santa Clara
         For:     electric wire overhang purposes
         Recorded:    November 28, 1960 in Book 4995, Page 160, Official Records
         Affects: Northerly 5 feet of said land, and as shown on the survey
                           prepared by Anthony C. McCants, L.S. 5944, dated
                           April 27, 2000, revised May 22, 2000

4.       The fact that the ownership of said land does not include any right of
         ingress or egress to or from Lawrence Expressway contiguous thereto,
         said right having been relinquished by deed,
         From: Jefferson Union Elementary School District of the County of Santa
               Clara
         To:   County of Santa Clara, State of California
         Recorded:   June 4, 1965 in Book 6982, Page 1, Official Records

         Said land, however, abuts on a public street other than the one
         referred to above, over which rights of vehicular access have not been
         relinquished.

5.       An Agreement, affecting said land, for the purposes stated herein and
         subject to the terms, covenants, conditions, restrictions, and
         easements, if any, contained therein
         For:     Postponed Traffic Signal Improvements
         Dated:   October 4, 1983
         Executed by: City of Santa Clara, California, a municipal corporation
                      and MPJ, a California partnership
         Recorded: November 16, 1983 in Book I 070, Page 333, Official Records.

6.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of: City of Santa Clara, a municipal corporation
         For:     roadway purposes and public utilities
         Recorded:   November 30, 1983 in Book I 111, Page 606, Official Records
         Affects:  A portion of that certain 24.740 acre parcel of land as shown
                     on that certain Record of Survey filed for record in Book
                     447 of Maps, at page 33, Santa Clara County Records,
                     described as

                             Exhibit B-3 - Page 5
<PAGE>

                        follows:

         Beginning at a point in the Northerly line of Monroe Avenue, as shown
         on said map at the Westerly terminus of the course shown as N. 89
         degrees 25 minutes 00 seconds E. 760.70; thence from said point of
         beginning along said Northerly line N. 89 degrees 25 minutes 00 seconds
         E. 760.70 feet and N. 2.00 feet; thence leaving said Northerly line
         along a line parallel with said course of N. 89 degrees 25 minutes 00
         seconds E.; S. 89 degrees 25 minutes 00 seconds W. 334.99 feet; thence
         leaving said parallel line N. 87 degrees 09 minutes 00 seconds W. 66.79
         feet; thence along a line parallel with said course N. 89 degrees 25
         minutes 00 seconds E.; S. 89 degrees 25 minutes 00 seconds W. 359.00
         feet; thence leaving said Westerly line along a tangent curve to the
         right, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to a
         point of cusp in the Westerly line of said 24.740 acre parcel; thence
         along said Westerly line S. 0 degrees 00 minutes 27 seconds E. 6.00
         feet; thence leaving said Westerly line along a tangent curve to the
         left, with a radius of 50.00 feet, through a central angle of 90
         degrees 34 minutes 33 seconds for an arc length of 79.04 feet to the
         point of beginning, and as shown on the survey prepared by Anthony C.
         McCants, L.S. 5944, dated April 27, 2000, revised May 22, 2000.

7.       An easement affecting the portion of said land and for the purpose
         stated herein and incidental purposes,
         In Favor Of: City of Santa Clara, a municipal corporation
         For:     underground electrical distribution and/or communication
         systems
         Recorded:    May 17, 1984 in Book I 552, Page 595, Official Records
         Affects. as follows:

         Parcel 1:

         Commencing at the point of intersection of the Westerly line of that
         certain 24.74 acre parcel of land shown upon that Record of Survey
         filed for recorded August 10, 1979 in Book 447 of Maps, at page 33,
         Santa Clara County Records, with a line parallel with and 10 feet
         Southerly of, measured at right angles to, the Northerly line of said
         parcel; thence along said parallel line N. 89 degrees 25 minutes 00
         seconds E. 107.00 feet; thence parallel with said Westerly line S. 0
         degrees 00 minutes 27 seconds E. 319.16 feet; thence S. 34 degrees 02
         minutes 45 seconds W. 87.51 feet, more or less, to intersection with a
         line parallel with and 58 feet Easterly of measured at right angles to,
         said Westerly line; thence along last said parallel line S. 0 degrees
         00 minutes 27 seconds E. 294.30 feet, more or less, to intersection
         with a line parallel with and 5 feet Northerly of, measured at right
         angles to, the Northerly line of that real property conveyed to the
         City of Santa Clara by that deed filed for record November 30, 1983 in
         Book I 111 of Official Records, at page 606, said County Records;
         thence along last said parallel line the following three (3) courses:
         N. 89 degrees 25 minutes 00 seconds E. 351.81 feet; S. 87 degrees 09
         minutes 00 seconds E. 66.79 feet; N. 89 degrees 25 minutes 00 seconds
         E. 334.69 feet; thence continuing parallel with the Southerly line of
         first said parcel N. 89 degrees 25 minutes 00 seconds E. 181.89 feet,
         more or less, to termination in the Easterly line of that certain
         parcel of real property conveyed to MPJ Partnership, by that Grant Deed
         filed for record August 25, 1983 in Book H 838 of Official Records, at
         page 215, said County Records.

         Parcel 2:

         A portion of said 24.74 acre parcel of land contiguous to and Northerly
         of said real property conveyed by deed recorded in Book I 111, at page
         606, contiguous to and Westerly of hereinabove described strip of land
         and bounded on the North by a line parallel with and 5 feet Northerly
         of, measured at right angles to, that course N. 89 degrees 25 minutes
         00 seconds E. 351.81 feet in the hereinabove described centerline.

         Parcel 3:

         A strip of land 10 feet in width and 30 feet in length of centerline of
         said strip being parallel with and 325.5 feet Southerly of, measured at
         right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on

                             Exhibit B-3 - Page 6
<PAGE>

         the West in the Easterly line of first hereinabove described strip;
         thence continuing Easterly along last said parallel line for a distance
         of 15 feet, as the centerline of a strip of land 15 feet in width, to
         termination of said centerline and strip.

         Parcel 4:

         A strip of land 10 feet in width and 12 feet in length the centerline
         of said strip being parallel with and 116.5 feet Southerly of, measured
         at right angles to, said Northerly line of the 24.74 acre parcel and
         terminating on the West in the Easterly line of first hereinabove
         described strip; thence continuing Easterly along last said parallel
         line for a distance of 15 feet in width, lying 5 feet Northerly and 10
         feet Southerly of said parallel line to the Easterly terminus of said
         strip.

         Parcel 5:

         A strip of land 10 feet in width, the centerline of said strip being
         described as follows:

         Commencing at the point of intersection of the Northerly line of first
         hereinabove described strip of land with a line parallel with and 824.5
         feet Easterly of, measured at right angles to, that course in the
         Westerly boundary of said 24.75 acre parcel bearing N. 0 degrees 00
         minutes 27 seconds W.; thence along last said parallel line N. 0
         degrees 00 minutes 27 seconds W. 367.96 feet, more or less, to a line
         parallel with and 327 feet Southerly of, measured at right angles to,
         said Northerly line of the 24.74 acre parcel; thence along last said
         parallel line S. 89 degrees 25 minutes 00 seconds W. 78 feet to a line
         parallel with and 746.5 feet Easterly of, measured at right angles to,
         said Westerly line of the 24.74 acre parcel; thence along last said
         parallel line N. 0 degrees 00 minutes 27 seconds W. 203 feet; thence
         continuing as the centerline of a strip of land 15 feet in width N. 0
         degrees 00 minutes 27 seconds W. 15 feet, more or less, to termination
         of said strip and centerline in a line parallel with and 109 feet
         Southerly of, measured at right angles to, last said Northerly line.

         Parcel 6:

         A 15 foot square parcel of land contiguous to and Southerly of last
         hereinabove described 10 foot wide strip of land and centered on the
         Southerly prolongation of hereinabove mentioned course N. 0 degrees 00
         minutes 27 seconds W. 203 feet, and as shown on the survey prepared by
         Anthony C. McCants, L.S. 5944, dated April 27, 2000, revised May 22,
         2000.

8.       Lease Agreement (Land) dated as of June 1, 2000, by and between BNP
         Leasing Corporation, as lessor, and Extreme Networks, Inc., as lessee,
         and Lease Agreement (Improvements) dated as of June 1, 2000, by and
         between BNP Leasing Corporation, as lessor, and Extreme Networks, Inc.,
         as lessee.

                             Exhibit B-3 - Page 7
<PAGE>

                                   Exhibit C
                                   ---------

                          BILL OF SALE AND ASSIGNMENT


     Reference is made to: (1) that certain Purchase Agreement (Improvements)
between BNP Leasing Corporation ("Assignor") and Extreme Networks, Inc., dated
as of June 1, 2000, (the "Purchase Agreement") and (2) that certain Lease
Agreement (Improvements) between Assignor, as landlord, and Extreme Networks,
Inc., as tenant, dated as of June 1, 2000 (the "Improvements Lease").
(Capitalized terms used and not otherwise defined in this document are intended
to have the meanings assigned to them in the Common Definitions and Provisions
Agreement (Improvements) incorporated by reference into both the Purchase
Agreement and Improvements Lease.)

     As contemplated by the Purchase Agreement, Assignor hereby sells, transfers
and assigns unto [EXTREME OR THE APPLICABLE PURCHASER, AS THE CASE MAY BE], a
_____________ ("Assignee"), all of Assignor's right, title and interest in and
to the following property, if any, to the extent such property is assignable:

     (a)  the Improvements Lease [DRAFTING NOTE: THE FOLLOWING WILL BE ADDED
ONLY IF APPLICABLE BECAUSE OF THE SIMULTANEOUS DELIVERY OF A GRANT DEED IN THE
FORM OF EXHIBIT B-3: and the Ground Lease dated _________, between _________, as
        -----------
lessor, and Assignor, as lessee, filed for record on in ___________ of Santa
Clara County records (the "Ground Lease")];

     (b)  any pending or future award made because of any condemnation affecting
the Property or because of any conveyance to be made in lieu thereof, and any
unpaid award for damage to the Property and any unpaid proceeds of insurance or
claim or cause of action for damage, loss or injury to the Property; and

     (c)  all other property included within the definition of "Property" as set
forth in the Purchase Agreement, including but not limited to any of the
following transferred to Assignor by the tenant pursuant to Paragraph 7 of the
                                                            -----------
Improvements Lease or otherwise acquired by Assignor, at the time of the
execution and delivery of the Improvements Lease and Purchase Agreement or
thereafter, by reason of Assignor's status as the owner of any interest in the
Property: (1) any goods, equipment, furnishings, furniture, chattels and
tangible personal property of whatever nature that are located on the Property
and all renewals or replacements of or substitutions for any of the foregoing;
(ii) the rights of Assignor, existing at the time of the execution of the
Improvements Lease and Purchase Agreement or thereafter arising, under Permitted
Encumbrances or Development Documents (both as defined in the Improvements
Lease); and (iii) any other permits, licenses, franchises, certificates, and
other rights and privileges related to the Property that Assignee would have
acquired if Assignee had itself acquired the Improvements covered by the
Improvements Lease and constructed the Improvements included in the Property.

Provided, however, excluded from this conveyance and reserved to Assignor are
any rights or privileges of Assignor under the following ("Excluded Rights"):
(1) the indemnities set forth in the Improvements Lease, whether such rights are
presently known or unknown, including rights of the Assignor to be indemnified
against environmental claims of third parties as provided in the Improvements
Lease which may not presently be known, (2) provisions in the Improvements Lease
that establish the right of Assignor to recover any accrued unpaid rent under
the Improvements Lease which may be outstanding as of the date hereof, (3)
agreements between Assignor and "BNPLC's Parent" or any "Participant," both as
defined in the Improvements Lease, or any modification or extension thereof, or
(4) any other instrument being delivered to Assignor contemporaneously herewith
pursuant to the Purchase Agreement. To the extent that this conveyance does
include any rights to receive future payments under the Improvements Lease, such
rights ("Included Rights") shall be subordinate to Assignor's Excluded Rights,
and Assignee hereby waives any rights to enforce Included Rights until such time
as Assignor has received all payments to which it remains entitled by reason of
Excluded Rights. If any amount shall be paid to Assignee on account of any
Included Rights at any time before Assignor has received all payments to which
it is entitled because of Excluded Rights, such amount shall be held in trust by
Assignee for the benefit of Assignor, shall be segregated from the other funds
of Assignee and shall forthwith be paid over to Assignor to be held by Assignor
as collateral for, or then or at any time thereafter applied in whole or
<PAGE>

in part by Assignor against, the payments due to Assignor because of Excluded
Rights, whether matured or unmatured, in such order as Assignor shall elect.

          Assignor does for itself and its successors covenant and agree to
warrant and defend the title to the property assigned herein against the just
and lawful claims and demands of any person claiming under or through a Lien
Removable by BNPLC, but not otherwise.

          Assignee hereby assumes and agrees to keep, perform and fulfill
Assignor's obligations, if any, relating to any permits or contracts, under
which Assignor has rights being assigned herein.

          IN WITNESS WHEREOF, the parties have executed this instrument as of
_______________, _____.



                                        ASSIGNOR:
                                        --------

                                        BNP LEASING CORPORATION a Delaware
                                        corporation



                                        By:_____________________________________
                                        Its:____________________________________


                                        ASSIGNEE:
                                        --------

                                        [Extreme or the Applicable Purchaser], a
                                        ____________________



                                        By:_____________________________________
                                        Its:____________________________________

                              Exhibit C - Page 2
<PAGE>

STATE OF ____________               )
                                    )        SS
COUNTY OF ___________      )


          On ___________________ before me,__________ , personally appeared
____________ and ____________, personally known to me (or proved to me on the
basis of satisfactory evidence) to be the persons whose names are subscribed to
the within instrument and acknowledged to me that they executed the same in
their authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

          WITNESS my hand and official seal.




          Signature _______________________________




STATE OF ____________               )
                                    )        SS
COUNTY OF ___________      )


          On ___________________ before me,__________ , personally appeared
___________ and ____________, personally known to me (or proved to me on the
basis of satisfactory evidence) to be the persons whose names are subscribed to
the within instrument and acknowledged to me that they executed the same in
their authorized capacities, and that by their signatures on the instrument the
person, or the entity upon behalf of which the persons acted, executed the
instrument.

          WITNESS my hand and official seal.



          Signature _______________________________

                              Exhibit C - Page 3
<PAGE>

                                    Annex A

                               LEGAL DESCRIPTION

[DRAFTING NOTE: TO THE EXTENT THAT THE "LAND" COVERED BY THE OTHER LEASE CHANGES
 --------------
FROM TIME TO TIME BECAUSE OF ADJUSTMENTS FOR WHICH EXTREME REQUESTS BNPLC'S
CONSENT OR APPROVAL, SO TOO WILL THE DESCRIPTION OF THE LAND BELOW CHANGE. ANY
SUCH CHANGES WILL BE INCORPORATED INTO THE DESCRIPTION BELOW AND THIS "DRAFTING
NOTE" WILL BE DELETED BEFORE THE DOCUMENT TO WHICH THIS DESCRIPTION IS ATTACHED
IS ACTUALLY EXECUTED AND DELIVERED.]

All that certain real property situated in the City of Santa Clara, County of
Santa Clara, State of California, described as follows:

Being a portion of that certain 24.740 acre parcel as shown on that certain
Record of Survey filed in Book 447 of Maps, at Page 33, Santa Clara County
Records, described as follows:

Beginning at the Northwest corner of said 24.740 acre parcel; thence from said
point of beginning along the Northerly line of said 24.470 acre parcel N. 89
degrees 25 minutes 00 seconds E. 995.17 feet; thence leaving said Northerly
lines S. 0 degrees 10 minutes 00 seconds W. 705.02 feet to a point in the
Southerly line of said 24.740 acre parcel; thence along said Southerly line the
following courses: S. 89 degrees 25 minutes 00 seconds W. 181.82 feet; S. 2.00
feet and S. 89 degrees 25 minutes 00 seconds W. 760.70 feet; thence leaving said
Southerly line along a tangent curve to the right, with a radius of 50.00 feet,
through a central angle of 90 degrees 34 minutes 33 seconds for an arc length of
79.4 feet to a point in the Westerly line of said 24.470 acre parcel; thence
along said Westerly line N. 0 degrees 00 minutes 27 seconds W. 656.49 feet to
the point of beginning.

                              Exhibit C - Page 4
<PAGE>

                                   Exhibit D
                                   ---------

        ACKNOWLEDGMENT OF DISCLAIMER OF REPRESENTATIONS AND WARRANTIES

     THIS ACKNOWLEDGMENT OF DISCLAIMER OF REPRESENTATIONS AND WARRANTIES (this
"Certificate") is made as of ___________________, ____, by [Extreme or the
Applicable Purchaser, as the case may be], a ___________________ ("Grantee").

     Contemporaneously with the execution of this Certificate, BNP Leasing
Corporation, a Delaware corporation ("BNPLC"), is executing and delivering to
Grantee (1) a corporate grant deed and (2) a Bill of Sale and Assignment (the
foregoing documents and any other documents to be executed in connection
therewith are herein called the "Conveyancing Documents" and any of the
properties, rights or other matters assigned, transferred or conveyed pursuant
thereto are herein collectively called the "Subject Property").

     Notwithstanding any provision contained in the Conveyancing Documents to
the contrary, Grantee acknowledges that BNPLC makes no representations or
warranties of any nature or kind, whether statutory, express or implied, with
respect to environmental matters or the physical condition of the Subject
Property, and Grantee, by acceptance of the Conveyancing Documents, accepts the
Subject Property "AS IS," "WHERE IS," "WITH ALL FAULTS" and without any such
                  -- --    ----- --    ---- --- ------
representation or warranty by Grantor as to environmental matters, the physical
condition of the Subject Property, compliance with subdivision or platting
requirements or construction of any improvements. Without limiting the
generality of the foregoing, Grantee hereby further acknowledges and agrees that
warranties of merchantability and fitness for a particular purpose are excluded
from the transaction contemplated by the Conveyancing Documents, as are any
warranties arising from a course of dealing or usage of trade. Grantee hereby
assumes all risk and liability (and agrees that BNPLC shall not be liable for
any special, direct, indirect, consequential, or other damages) resulting or
arising from or relating to the ownership, use, condition, location,
maintenance, repair, or operation of the Subject Property, except for damages
proximately caused by (and attributed by any applicable principles of
comparative fault to) the Established Misconduct of BNPLC. As used in the
preceding sentence, "Established Misconduct" is intended to have, and be limited
to, the meaning given to it in the Common Definitions and Provisions Agreement
(Improvements) incorporated by reference into the Purchase Agreement between
BNPLC and Extreme Networks, Inc. dated as of June 1, 2000, pursuant to which
Purchase Agreement BNPLC is delivering the Conveyancing Documents.

     The provisions of this Certificate shall be binding on Grantee, its
successors and assigns and any other party claiming through Grantee. Grantee
hereby acknowledges that BNPLC is entitled to rely and is relying on this
Certificate.

     EXECUTED as of ________________, ____.


                                       [Extreme or the Applicable Purchaser]
                                       By:______________________________________
                                          Name:_________________________________
                                          Title:________________________________
<PAGE>

                                   Exhibit E
                                   ---------

                            SECRETARY'S CERTIFICATE


     The undersigned, [Secretary or Assistant Secretary] of BNP Leasing
Corporation, a Delaware corporation (the "Corporation"), hereby certifies as
follows:

     1.   That he is the duly, elected, qualified and acting Secretary [or
Assistant Secretary] of the Corporation and has custody of the corporate
records, minutes and corporate seal.

     2.   That the following named persons have been properly designated,
elected and assigned to the office in the Corporation as indicated below; that
such persons hold such office at this time and that the specimen signature
appearing beside the name of such officer is his or her true and correct
signature.

[The following blanks must be completed with the names and signatures of the
officers who will be signing the deed and other Sale Closing Documents on behalf
of the Corporation.]

Name                        Title                      Signature
----                        -----                      ---------

___________________         ________________           _________________________

___________________         ________________           _________________________

     3.   That the resolutions attached hereto and made a part hereof were duly
adopted by the Board of Directors of the Corporation in accordance with the
Corporation's Articles of Incorporation and Bylaws. Such resolutions have not
been amended, modified or rescinded and remain in full force and effect.

     IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of
the Corporation on this __, day of __, _.


                                        ____________________________
                                        [signature and title]
<PAGE>

                           CORPORATE RESOLUTIONS OF
                            BNP LEASING CORPORATION


     WHEREAS, pursuant to that certain Purchase Agreement (Improvements) (herein
called the "Purchase Agreement") dated as of June 1, 2000, by and between BNP
Leasing Corporation (the "Corporation") and [Extreme or the Applicable Purchaser
as the case may be] ("Purchaser"), the Corporation agreed to sell and Purchaser
agreed to purchase or cause the Applicable Purchaser (as defined in the Purchase
Agreement) to purchase the Corporation's interest in the property (the
"Property") located in Santa Clara, California more particularly described
therein.

     NOW THEREFORE, BE IT RESOLVED, that the Board of Directors of the
Corporation, in its best business judgment, deems it in the best interest of the
Corporation and its shareholders that the Corporation convey the Property to
Purchaser or the Applicable Purchaser pursuant to and in accordance with the
terms of the Purchase Agreement.

     RESOLVED FURTHER, that the proper officers of the Corporation, and each of
them, are hereby authorized and directed in the name and on behalf of the
Corporation to cause the Corporation to fulfill its obligations under the
Purchase Agreement.

     RESOLVED FURTHER, that the proper officers of the Corporation, and each of
them, are hereby authorized and directed to take or cause to be taken any and
all actions and to prepare or cause to be prepared and to execute and deliver
any and all deeds and other documents, instruments and agreements that shall be
necessary, advisable or appropriate, in such officer's sole and absolute
discretion, to carry out the intent and to accomplish the purposes of the
foregoing resolutions.

                              Exhibit E - Page 2
<PAGE>

                                   Exhibit F
                                   ---------

                               FIRPTA STATEMENT

     Section 1445 of the Internal Revenue Code of 1986, as amended, provides
that a transferee of a U.S. real property interest must withhold tax if the
transferor is a foreign person. Sections 18805, 18815 and 26131 of the
California Revenue and Taxation Code, as amended, provide that a transferee of a
California real property interest must withhold income tax if the transferor is
a nonresident seller.

     To inform [Extreme or the Applicable Purchaser] (the "Transferee") that
withholding of tax is not required upon the disposition of a California real
property interest by transferor, BNP Leasing Corporation (the "Seller"), the
undersigned hereby certifies the following on behalf of the Seller:

     1.   The Seller is not a foreign corporation, foreign partnership, foreign
trust, or foreign estate (as those terms are defined in the Internal Revenue
Code and Income Tax Regulations);

     2.   The United States employer identification number for the Seller is
_____________________;

     3.   The office address of the Seller is ______________
_________________________ _________________.

     4.   The Seller is qualified to do business in California.

     The Seller understands that this certification may be disclosed to the
Internal Revenue Service and/or to the California Franchise Tax Board by the
Transferee and that any false statement contained herein could be punished by
fine, imprisonment, or both.

     The Seller understands that the Transferee is relying on this affidavit in
determining whether withholding is required upon said transfer.

     Under penalties of perjury I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of the Seller.

     Dated: ___________, ____.


                                        By:___________________________
                                        Name:_________________________
                                        Title:________________________
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.12
<SEQUENCE>8
<FILENAME>0008.txt
<DESCRIPTION>FORM OF PLEDGE AGREEMENT (LAND) JUNE 1, 2000
<TEXT>

<PAGE>

================================================================================

                                                            EXHIBIT 10.12


                               PLEDGE AGREEMENT
                                    (LAND)


                                     AMONG


                            BNP LEASING CORPORATION

                                   ("BNPLC")

                             BNP PARIBAS, AS AGENT

                                   ("Agent")


                            EXTREME NETWORKS, INC.

                                  ("Extreme")


                                      AND


                       PARTICIPANTS AS DESCRIBED HEREIN






                                 June 1, 2000


================================================================================
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                     Page
                                                                                                                     ----
<S>                                                                                                                  <C>
ARTICLE I DEFINITIONS AND INTERPRETATION...........................................................................   -1-
         Section 1.1 Capitalized Terms Used But Not Defined in This Agreement......................................   -1-
                     --------------------------------------------------------
         Section 1.2 Definitions...................................................................................   -1-
                     -----------
                  Account..........................................................................................   -1-
                  Account Office...................................................................................   -2-
                  Agent............................................................................................   -2-
                  BNPLC............................................................................................   -2-
                  BNPLC's Corresponding Obligations to Participants................................................   -2-
                  Cash Collateral..................................................................................   -2-
                  Certificate of Deposit...........................................................................   -2-
                  Collateral.......................................................................................   -2-
                  Collateral Imbalance.............................................................................   -2-
                  Collateral Percentage............................................................................   -2-
                  Default..........................................................................................   -3-
                  Deposit Taker....................................................................................   -3-
                  Deposit Taker Losses.............................................................................   -3-
                  Deposit Taker's Acknowledgment and Agreement.....................................................   -3-
                  Disqualified Deposit Taker.......................................................................   -3-
                  Event of Default.................................................................................   -3-
                  Extreme..........................................................................................   -4-
                  Extreme's Purchase Agreement Obligations.........................................................   -4-
                  Initially Qualified Deposit Taker................................................................   -5-
                  Lien.............................................................................................   -5-
                  Material Lease Default...........................................................................   -5-
                  Minimum Collateral Percentage....................................................................   -5-
                  Minimum Collateral Value.........................................................................   -6-
                  Notice of Security Interest......................................................................   -6-
                  Other Liable Party...............................................................................   -6-
                  Participants.....................................................................................   -6-
                  Participation Agreement..........................................................................   -6-
                  Percentage.......................................................................................   -6-
                  Qualified Pledge.................................................................................   -6-
                  Secured Obligations..............................................................................   -6-
                  Supplement.......................................................................................   -6-
                  Transaction Documents............................................................................   -6-
                  Value............................................................................................   -7-
         Section 1.3  Attachments..................................................................................   -7-
                      -----------
         Section 1.4  Amendment of Defined Instruments.............................................................   -7-
                      --------------------------------
         Section 1.5  References and Titles........................................................................   -7-
                      ---------------------

ARTICLE II SECURITY INTEREST.......................................................................................   -7-
         Section 2.1  Pledge and Grant of Security Interest........................................................   -7-
                      -------------------------------------
         Section 2.2  Return of Collateral After the Secured Obligations are Satisfied in Full.....................   -8-
                      ------------------------------------------------------------------------

ARTICLE III DETERMINATION OF THE COLLATERAL PERCENTAGE.............................................................   -8-
         Section 3.1  Determination of the Collateral Percentage Generally.........................................   -8-
                      ----------------------------------------------------
</TABLE>
<PAGE>

<TABLE>
<S>                                                                                                                  <C>
         Section 3.2  Limitations on Extreme's Right to Lower the Collateral Percentage............................   -8-
                      -----------------------------------------------------------------
         Section 3.3  Minimum Collateral Percentages Dependent Upon the Adjusted EBITDAR Coverage Ratio............   -9-
                      ---------------------------------------------------------------------------------

ARTICLE IV   PROVISIONS CONCERNING DEPOSIT TAKERS..................................................................   -9-
         Section 4.1  Qualification of Deposit Takers Generally....................................................   -9-
                      -----------------------------------------
         Section 4.2  Existing Deposit Takers......................................................................   -9-
                      -----------------------
         Section 4.3  Replacement of Participants Proposed by Extreme..............................................  -10-
                      -----------------------------------------------
         Section 4.4  Mandatory Substitution for Disqualified Deposit Takers.......................................  -10-
                      ------------------------------------------------------
         Section 4.5  Voluntary Substitution of Deposit Takers.....................................................  -10-
                      ----------------------------------------
         Section 4.6  Delivery of Notice of Security Interest by Extreme and Agent.................................  -10-
                      ------------------------------------------------------------
         Section 4.7  Constructive Possession of Collateral........................................................  -11-
                      -------------------------------------
         Section 4.8  Attempted Setoff by Deposit Takers...........................................................  -11-
                      ----------------------------------
         Section 4.9  Deposit Taker Losses.........................................................................  -11-
                      --------------------
         Section 4.10  Losses Resulting from Failure of Deposit Taker to Comply with this Agreement................  -11-
                       ----------------------------------------------------------------------------

ARTICLE V   DELIVERY AND MAINTENANCE OF CASH COLLATERAL............................................................  -12-
         Section 5.1  Delivery of Funds by Extreme.................................................................  -12-
                      ----------------------------
         Section 5.2  Transition Account...........................................................................  -12-
                      ------------------
         Section 5.3  Allocation of Cash Collateral Among Deposit Takers...........................................  -12-
                      --------------------------------------------------
         Section 5.4  Issuance and Redemption of Certificates of Deposit...........................................  -13-
                      --------------------------------------------------
         Section 5.5  Status of the Accounts Under the Reserve Requirement Regulations.............................  -13-
                      ----------------------------------------------------------------
         Section 5.6  Acknowledgment by Extreme that Requirements of this Agreement are Commercially Reasonable....  -13-
                      -----------------------------------------------------------------------------------------

ARTICLE VI   WITHDRAWAL OF CASH COLLATERAL.........................................................................  -14-
         Section 6.1  Withdrawal of Collateral Prior to the Designated Sale Date...................................  -14-
                      ----------------------------------------------------------
         Section 6.2  Withdrawal and Application of Cash Collateral to Reduce or Satisfy the Secured
                      ------------------------------------------------------------------------------
                       Obligations to the Participants.............................................................  -14-
                       -------------------------------
         Section 6.3  Withdrawal and Application of Cash Collateral to Reduce or Satisfy the Secured
                      ------------------------------------------------------------------------------
                       Obligations to BNPLC........................................................................  -15-
                      ---------------------
         Section 6.4  Withdrawal of Cash Collateral From Accounts Maintained by Disqualified Deposit Takers........  -15-
                      -------------------------------------------------------------------------------------

ARTICLE VII   REPRESENTATIONS AND COVENANTS OF Extreme.............................................................  -15-
         Section 7.1  Representations of Extreme...................................................................  -15-
                      --------------------------
         Section 7.2  Covenants of Extreme.........................................................................  -16-
                      --------------------

ARTICLE VIII    AUTHORIZED ACTION BY AGENT.........................................................................  -17-
         Section 8.1  Power of Attorney............................................................................  -17-
                      -----------------

ARTICLE IX    DEFAULT AND REMEDIES.................................................................................  -18-
         Section 9.1  Remedies.....................................................................................  -18-
                      --------

ARTICLE X    OTHER RECOURSE........................................................................................  -18-
         Section 10.1  Recovery Not Limited........................................................................  -18-
                       --------------------

ARTICLE XI   PROVISIONS CONCERNING AGENT...........................................................................  -19-
         Section 11.1  Appointment and Authority...................................................................  -19-
                       -------------------------
         Section 11.2  Exculpation, Agent's Reliance, Etc..........................................................  -19-
                       ----------------------------------
         Section 11.3  Participant's Credit Decisions..............................................................  -20-
                       ------------------------------
         Section 11.4  Indemnity...................................................................................  -20-
                       ---------
         Section 11.5  Agent's Rights as Participant and Deposit Taker.............................................  -20-
                       -----------------------------------------------
</TABLE>
<PAGE>

<TABLE>
<S>                                                                                                                  <C>
         Section 11.6  Investments.................................................................................  -20-
                       -----------
         Section 11.7  Benefit of Article XI.......................................................................  -21-
                       ---------------------
         Section 11.8  Resignation.................................................................................  -21-
                       -----------

ARTICLE XII   MISCELLANEOUS........................................................................................  -21-
         Section 12.1 Provisions Incorporated From Other Operative Documents.......................................  -21-
                      ------------------------------------------------------
         Section 12.2  Cumulative Rights, etc......................................................................  -21-
                       ----------------------
         Section 12.3  Survival of Agreements......................................................................  -21-
                       ----------------------
         Section 12.4  Other Liable Party..........................................................................  -22-
                       ------------------
         Section 12.5  Termination.................................................................................  -22-
                       -----------
</TABLE>
<PAGE>

<TABLE>
<S>                                              <C>
Attachment 1.........................................................................Form of Certificate of Deposit

Attachment 2..................................................................Supplement to Pledge Agreement (Land)

Attachment 3.......................................Notice of Extreme's Election to Change the Collateral Percentage

Attachment 4............................................................................Notice of Security Interest

Attachment 5...............................................................................Examples of Calculations

Attachment 6.....................................Notice of Extreme's Requirement to Withdraw Excess Cash Collateral

Attachment 7.....................................Notice of Extreme's Requirement of Direct Payments to Participants

Attachment 8.....................................Notice of Extreme's Requirement of Direct Payments to Participants

Attachment 9........................................................Notice of Extreme's Requirement of a Withdrawal
                                                               of Cash Collateral from a Disqualified Deposit Taker

Schedule 1...............................................................Financial Covenants and Negative Covenants
----------
</TABLE>

                                     -iv-
<PAGE>

                               PLEDGE AGREEMENT
                                    (LAND)

     This PLEDGE AGREEMENT (LAND) (this "Agreement") is made as of June 1, 2000
(the "Effective Date"), by EXTREME NETWORKS, INC., a California corporation
("Extreme"); BNP LEASING CORPORATION, a Delaware corporation ("BNPLC"); BNP
PARIBAS ("BNPLC's Parent"), as a "Participant"; and BNP PARIBAS, acting in its
capacity as agent for BNPLC and the Participants (in such capacity, "Agent").

                                   RECITALS
                                   --------

     A.   Extreme and BNPLC are parties to: (i) a Common Definitions and
Provisions Agreement (Land) dated as of the Effective Date (the "Common
Definitions and Provisions Agreement (Land)"); and (ii) a Purchase Agreement
(Land) dated as of the Effective Date (the "Purchase Agreement"), pursuant to
which Extreme has agreed to make a "Supplemental Payment" (as defined in the
Common Definitions and Provisions Agreement (Land)), in consideration of the
rights granted to Extreme by the Purchase Agreement.

     B.   Pursuant to a Participation Agreement dated the date hereof (the
"Participation Agreement"), BNPLC's Parent has agreed with BNPLC to participate
in the risks and rewards to BNPLC of the Purchase Agreement and other Operative
Documents (as defined in the Common Definitions and Provisions Agreement
(Land)), and the parties to this Agreement anticipate that other financial
institutions may become parties to the Participation Agreement as Participants,
agreeing to participate in the risks and rewards to BNPLC of the Purchase
Agreement and other Operative Documents.

     C.   Extreme may from time to time deliver cash collateral for its
obligations to BNPLC under the Purchase Agreement and for BNPLC's corresponding
obligations to Participants under the Participation Agreement. This Agreement
sets forth the terms and conditions governing such cash collateral.

                                   AGREEMENT
                                   ---------

     NOW, THEREFORE, in consideration of the above recitals and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

                   ARTICLE I DEFINITIONS AND INTERPRETATION

     Section 1.1  Capitalized Terms Used But Not Defined in This Agreement. All
                  --------------------------------------------------------
capitalized terms used in this Agreement which are defined in Article I of
the Common Definitions and Provisions Agreement (Land) and not otherwise defined
herein shall have the same meanings herein as set forth in the Common
Definitions and Provisions Agreement (Land). All terms used in this Agreement
which are defined in the UCC and not otherwise defined herein shall have the
same meanings herein as set forth therein, except where the context otherwise
requires.

     Section 1.2  Definitions. When used in this Agreement, the following terms
                  -----------
shall have the following respective meanings:

          "Account" shall mean any deposit account maintained by a Deposit Taker
     into which Cash Collateral may be deposited at any time, excluding the
     Transition Account.
<PAGE>

          "Account Office" shall mean, with respect to any Account maintained by
     any Deposit Taker, the office of such Deposit Taker in California or New
     York at which such Account is maintained as specified in the applicable
     Deposit Taker's Acknowledgment and Agreement.

          "Agent" shall have the meaning given to that term in the introductory
     paragraph hereof.

          "BNPLC" shall have the meaning given to that term in the introductory
     paragraph hereof.

          "BNPLC's Corresponding Obligations to Participants" shall mean BNPLC's
     obligations under the Participation Agreement to pay Participants their
     respective Percentages of (or amounts equal to their respective Percentages
     of) sums "actually received by BNPLC" (as defined in the Participation
     Agreement) in satisfaction of Extreme's Purchase Agreement Obligations;
     provided, however, any modification of the Participation Agreement executed
     after the date hereof without Extreme's written consent shall not be
     considered for purposes of determining BNPLC's Corresponding Obligations to
     Participants under this Agreement.

          "Cash Collateral" shall mean (i) all money of Extreme which Extreme
     has delivered to Agent for deposit with a Deposit Taker pursuant to this
     Agreement, and (ii) any additional money delivered to Agent as Collateral
     pursuant to Section 4.9.

          "Certificate of Deposit" shall mean a certificate of deposit issued by
     a Deposit Taker as required by Section 5.4 below to evidence an Account
     into which Cash Collateral has been deposited pursuant to this Agreement.
     Each Certificate of Deposit shall be issued in an amount equal to the Value
     of the Account which it evidences and shall otherwise be in the form set
     forth as ATTACHMENT 1.
              ------------

          "Collateral" shall have the meaning given to that term in Section 2.1
     hereof.

          "Collateral Imbalance" shall mean on any date prior to the Designated
     Sale Date that the Value (without duplication) of Accounts maintained by
     and Certificates of Deposit issued by the Deposit Taker for any Participant
     (other than a Disqualified Deposit Taker) does not equal such Participant's
     Percentage, multiplied by the lesser of (1) the Minimum Collateral Value in
     effect on such date, or (2) the aggregate Value of all Collateral subject
     to this Agreement on such date. For purposes of determining whether a
     Collateral Imbalance exists, the Value of any Accounts maintained by a bank
     that is acting as Deposit Taker for two or more Participants will be deemed
     to be held for them in proportion to their respective Percentages, and the
     Value of any Accounts maintained by a bank as Deposit Taker for both a
     Participant and BNPLC (as in the case of BNPLC's Parent acting as Deposit
     Taker for itself, as a Participant, and for BNPLC) will be deemed to be
     held for the Participant only to the extent necessary to prevent or
     mitigate a Collateral Imbalance and otherwise for BNPLC.

          "Collateral Percentage" shall mean the percentage designated by
     Extreme in accordance with this Agreement from time to time, but never less
     than the Minimum Collateral Percentage established as provided in Part III
     of Schedule 1.
        ----------

          "Default" means any Event of Default and any default, event or
     condition which would, with the giving of any requisite notices and the
     passage of any requisite periods of time, constitute an Event of Default.

                                      -2-
<PAGE>

          "Deposit Taker" for BNPLC shall mean BNPLC's Parent and for each
     Participant shall mean the Participant itself; provided, that each of BNPLC
     and the Participants, for itself only, may from time to time designate
     another Deposit Taker as provided in Sections 4.4 and 4.5 below.

          "Deposit Taker Losses" shall mean the Value of any Cash Collateral
     delivered to a Deposit Taker, but that the Deposit Taker will not (because
     of the insolvency of the Deposit Taker, offsets by the Deposit Taker in
     violation of the Deposit Taker's Acknowledgment and Agreement, or
     otherwise) return to Extreme or return to Agent for disposition or
     application as provided herein or as required by applicable law.

          "Deposit Taker's Acknowledgment and Agreement" shall have the meaning
     given to that term in subsection 4.1.2 hereof.

          "Disqualified Deposit Taker" shall mean any Deposit Taker with whom
     Agent may decline to deposit Collateral pursuant to Section 4.1.

          "Event of Default" shall mean the occurrence of any of the following:

               (a)  the failure by Extreme to pay all or any part of Extreme's
          Purchase Agreement Obligations when due, after giving effect to any
          applicable notice and grace periods expressly provided for in the
          Purchase Agreement;

               (b)  the failure by Extreme to provide funds as and when required
          by Section 5.1 of this Agreement, if within seven Business Days after
          such failure commences Extreme does not (1) cure such failure by
          delivering the funds required by Section 5.1, and (2) pay to BNPLC as
          additional Rent under the Land Lease an amount equal to interest at
          the Default Rate (as defined in the Land Lease) on such funds for the
          period from which they were first due to the date of receipt by Agent;

               (c)  the failure of the pledge or security interest contemplated
          herein in the Transition Account or any Account, Certificate of
          Deposit or Cash Collateral to be a Qualified Pledge (regardless of the
          characterization of the Transition Account or any Accounts,
          Certificates of Deposit or Cash Collateral as deposit accounts,
          instruments or general intangibles under the UCC), unless:

                    (I)  such failure would not exist but for a breach of this
               Agreement by Agent or a breach of a Deposit Taker's
               Acknowledgment and Agreement by a Deposit Taker, or

                    (II) within five Business Days after Extreme becomes aware
               of such failure, Extreme shall (1) notify Agent, BNPLC and the
               Participants of such failure, and (2) cure such failure, and (3)
               to the extent required by Section 7.2.9, pay to BNPLC any
               additional Base Rent that has accrued under the Land Lease
               because of (or that would have accrued if BNPLC had been aware
               of) such failure, together with interest at the Default Rate on
               any such additional Base Rent;

               (d)  the failure of any representation herein by Extreme to be
          true (other than a failure described in another clause of this
          definition of Event of Default), if such failure is not cured within
          thirty days after Extreme receives written notice thereof from Agent;

                                      -3-
<PAGE>

               (e)  the failure of any representation made by Extreme in
          subsection 7.1.1 to be true, if within fifteen (15) days after Extreme
          becomes aware of such failure, Extreme does not (1) notify Agent,
          BNPLC and the Participants of such failure, and (2) cure such failure,
          and (3) pay to BNPLC any additional Base Rent that has accrued under
          the Land Lease because of (or that would have accrued if BNPLC had
          been aware of) such failure, and (4) pay to BNPLC interest at the
          Default Rate on any such additional Base Rent;

               (f)  the failure by Extreme timely and properly to observe, keep
          or perform any covenant, agreement, warranty or condition herein
          required to be observed, kept or performed (other than a failure
          described in another clause of this definition of Event of Default),
          if such failure is not cured within thirty days after Extreme receives
          written notice thereof from Agent; and

               (g)  the failure by BNPLC to pay when due on or after the
          Designated Sale Date any of BNPLC's Corresponding Obligations to
          Participants, after giving effect to any applicable notice and grace
          periods expressly provided for in the Participation Agreement.

     Notwithstanding the foregoing, if ever the aggregate Value of Cash
     Collateral held by Agent and the Deposit Takers exceeds the Minimum
                                                     -------
     Collateral Value then in effect, a failure of the pledge or security
     interest contemplated herein in such excess Cash Collateral to be a valid,
                                     -----------
     perfected, first priority pledge or security interest shall not constitute
     an Event of Default under this Agreement. Accordingly, to provide a cure as
     required to avoid an Event of Default under clauses (c) or (e) of this
     definition, Extreme could deliver additional Cash Collateral - the pledge
     of which or security interest in which created by this Agreement is a
     Qualified Pledge - sufficient in amount to cause the aggregate Value of the
     Cash Collateral then held by Agent and the Deposit Takers subject to a
     Qualified Pledge hereunder to equal or exceed the Minimum Collateral Value.

          "Extreme" shall have the meaning given to that term in the
     introductory paragraph hereof.

          "Extreme's Purchase Agreement Obligations" shall mean all of Extreme's
     obligations under the Purchase Agreement, including (i) Extreme's
     obligation to pay any Supplemental Payment as required under subparagraph
                                                                  ------------
     1(A) of the Purchase Agreement, and (ii) any damages incurred by BNPLC
     ----
     because of (A) Extreme's breach of the Purchase Agreement or (B) the
     rejection by Extreme of the Purchase Agreement in any bankruptcy or
     insolvency proceeding.

          "Initially Qualified Deposit Taker" means (1) BNP PARIBAS, acting
     through any branch, office or agency that can lawfully maintain an Account
     as a Deposit Taker hereunder, and (2) any of the fifty largest (measured by
     total assets) U.S. banks, or one of the one hundred largest (measured by
     total assets) banks in the world, with debt ratings of at least (i) A- (in
     the case of long term debt) and A-1 (in the case of short term debt) or the
     equivalent thereof by Standard and Poor's Corporation, and (ii) A3 (in the
     case of long term debt) and P-2 (in the case of short term debt) or the
     equivalent thereof by Moody's Investor Service, Inc. The parties believe it
     improbable that the ratings systems used by Standard and Poor's Corporation
     and by Moody's Investor Service, Inc. will be discontinued or changed, but
     if such ratings systems are discontinued or changed, Extreme shall be
     entitled to select and use a comparable ratings systems as a substitute for
     the S&P Rating or the Moody Rating, as the case may be, for purposes of
     determining the status of any bank as an Initially Qualified Deposit Taker.

          "Lien" shall mean, with respect to any property or assets, any right
     or interest therein of a creditor to secure indebtedness of any kind which
     is owed to him or any other arrangement with such creditor which provides
     for the payment of such indebtedness out of such property or assets

                                      -4-
<PAGE>

     or which allows him to have such indebtedness satisfied out of such
     property or assets prior to the general creditors of any owner thereof,
     including any lien, mortgage, security interest, pledge, deposit,
     production payment, rights of a vendor under any title retention or
     conditional sale agreement or lease substantially equivalent thereto, tax
     lien, mechanic's or materialman's lien, or any other charge or encumbrance
     for security purposes, whether arising by law or agreement or otherwise,
     but excluding any right of setoff which arises without agreement in the
     ordinary course of business. "Lien" also means any filed financing
     statement, any registration with an issuer of uncertificated securities, or
     any other arrangement which would serve to perfect a Lien described in the
     preceding sentence, regardless of whether such financing statement is
     filed, such registration is made, or such arrangement is undertaken before
     or after such Lien exists.

          "Material Lease Default" shall mean any of the following:

               (1)  any "Event of Default" under and as defined in the Land
          Lease, including any such Event of Default consisting of a failure of
          Extreme to comply with the requirements of Schedule I attached to the
                                                     ----------
          Land Lease; and

               (2)(a) any failure of Extreme to make any payment required by and
          when first due under the Land Lease, regardless of whether any period
          provided in the Land Lease for the cure of such failure by Extreme
          shall have expired, and (b) any other default, event or condition
          which would, with the giving of any requisite notices and the passage
          of any requisite periods of time, constitute an "Event of Default"
          under and as defined in the Land Lease, if such other default, event
          or failure involves a material noncompliance with Applicable Law. (For
          purposes of this definition, "material" noncompliance with Applicable
          Law will include any noncompliance, the correction of which has been
          requested by a governmental authority, or because of which a threat of
          action against the Property or BNPLC has been asserted by a
          governmental authority.)

          "Minimum Collateral Percentage" shall mean the percentage established
     as such from time to time as described in Part III of Schedule 1.
                                                           ----------

          "Minimum Collateral Value" shall mean (1) as of the Designated Sale
     Date or any prior date, an amount equal to the Collateral Percentage
     multiplied by the Stipulated Loss Value determined as of that date in
     accordance with the Land Lease; and (2) as of any date after the Designated
     Sale Date, an amount equal to the Break Even Price plus any unpaid interest
     accrued on past due amounts payable pursuant to Paragraph 1(a) of the
     Purchase Agreement.

          "Notice of Security Interest" shall have the meaning given to
     that term in subsection 4.1.1 hereof.

          "Other Liable Party" shall mean any Person, other than Extreme, who
     may now or may at any time hereafter be primarily or secondarily liable for
     any of the Secured Obligations or who may now or may at any time hereafter
     have granted to Agent a pledge of or security interest in any of the
     Collateral.

          "Participants" shall mean BNPLC's Parent and any other financial
     institutions which may hereafter become parties to (i) this Agreement by
     completing, executing and delivering to Extreme and Agent a Supplement, and
     (ii) the Participation Agreement.

          "Participation Agreement" shall have the meaning given to such term in
     Recital B hereof.
     ---------

                                      -5-
<PAGE>

          "Percentage" shall mean with respect to each Participant and the
     Deposit Taker for such Participant, such Participant's "Percentage" under
     and as defined in the Participation Agreement for purposes of computing
     such Participant's right thereunder to receive payments of (or amounts
     equal to a percentage of) any sales proceeds or Supplemental Payment
     received by BNPLC under the Purchase Agreement. Percentages may be adjusted
     from time to time as provided in the Participation Agreement or as provided
     in supplements thereto executed as provided in the Participation Agreement.

          "Qualified Pledge" means a pledge or security interest that
     constitutes a valid, perfected, first priority pledge or security interest.

          "Secured Obligations" shall mean and include both Extreme's Purchase
     Agreement Obligations and BNPLC's Corresponding Obligations to
     Participants.

          "Supplement" shall mean a supplement to this Agreement in the form of
     ATTACHMENT 2.
     ------------

          "Transaction Documents" shall mean, collectively, this Agreement, the
     Land Lease, the Purchase Agreement and the Participation Agreement.

          "Transition Account" shall have the meaning given it in Section 5.2.

          "UCC" shall mean the Uniform Commercial Code as in effect in the State
     of California from time to time, and the Uniform Commercial Code as in
     effect in any other jurisdiction which governs the perfection or non-
     perfection of the pledge of and security interests in the Collateral
     created by this Agreement.

          "Value" shall mean with respect to any Account, Certificate of Deposit
     or Cash Collateral on any date, a dollar value determined as follows
     (without duplication):

               (a)  cash shall be valued at its face amount on such date;

               (b)  an Account shall be valued at the principal balance thereof
          on such date; and

               (c)  a Certificate of Deposit shall be valued at the face amount
          thereof.

     Section 1.3  Attachments. All attachments to this Agreement are a part
                  -----------
hereof for all purposes.

     Section 1.4  Amendment of Defined Instruments. Unless the context otherwise
                  --------------------------------
requires or unless otherwise provided herein, references in this Agreement to a
particular agreement, instrument or document (including references to the Land
Lease, Purchase Agreement and Participation Agreement) also refer to and include
all valid renewals, extensions, amendments, modifications, supplements or
restatements of any such agreement, instrument or document; provided that
nothing contained in this Section shall be construed to authorize any Person to
execute or enter into any such renewal, extension, amendment, modification,
supplement or restatement.

     Section 1.5  References and Titles. All references in this Agreement to
                  ---------------------
Attachments, Articles, Sections, subsections, and other subdivisions refer to
the Attachments, Articles, Sections, subsections and other subdivisions of this
Agreement unless expressly provided otherwise. Titles appearing at the

                                      -6-
<PAGE>

beginning of any subdivision are for convenience only and do not constitute any
part of any such subdivision and shall be disregarded in construing the language
contained in this Agreement. The words "this Agreement", "herein", "hereof",
"hereby", "hereunder" and words of similar import refer to this Agreement as a
whole and not to any particular subdivision unless expressly so limited. The
phrases "this Article," "this Section" and "this subsection" and similar phrases
refer only to the Articles, Sections or subsections hereof in which the phrase
occurs. The word "or" is not exclusive, and the word "including" (in all of its
forms) means "including without limitation". Pronouns in masculine, feminine and
neuter gender shall be construed to include any other gender, and words in the
singular form shall be construed to include the plural and vice versa unless the
context otherwise requires.

                         ARTICLE II SECURITY INTEREST

     Section 2.1  Pledge and Grant of Security Interest. As security for the
                  -------------------------------------
Secured Obligations, Extreme hereby pledges and assigns to Agent (for the
ratable benefit of BNPLC and the Participants) and grants to Agent (for the
ratable benefit of BNPLC and the Participants) a continuing security interest
and lien in and against all right, title and interest of Extreme in and to the
following property, whether now owned or hereafter acquired by Extreme
(collectively and severally, the "Collateral"):

          (a)  All Cash Collateral, all Accounts, the Transition Account and all
     Certificates of Deposit issued from time to time and general intangibles
     arising therefrom or relating thereto (however, "general intangibles" as
     used in this clause shall not include any general intangibles not related
     to Cash Collateral, Accounts, the Transition Account or Certificates of
     Deposit issued from time to time, and thus will not include, without
     limitation, any intellectual property of Extreme); and all documents,
     instruments and agreements evidencing the same; and all extensions,
     renewals, modifications and replacements of the foregoing; and any interest
     or other amounts payable in connection therewith; and

          (b)  All proceeds of the foregoing (including whatever is receivable
     or received when Collateral or proceeds is invested, sold, collected,
     exchanged, returned, substituted or otherwise disposed of, whether such
     disposition is voluntary or involuntary, including rights to payment and
     return premiums and insurance proceeds under insurance with respect to any
     Collateral, and all rights to payment with respect to any cause of action
     affecting or relating to the Collateral).

The pledge, assignment and grant of a security interest made by Extreme
hereunder is for security of the Secured Obligations only; the parties to this
Agreement do not intend that Extreme's delivery of the Collateral to Agent as
herein provided will constitute an advance payment of any Secured Obligations or
liquidated damages, nor do the parties intend that the Collateral increase the
dollar amount of the Secured Obligations.

     Section 2.2  Return of Collateral After the Secured Obligations are
                  ------------------------------------------------------
Satisfied in Full. If any proceeds of Collateral remain after all Secured
-----------------
Obligations have been paid in full, Agent will deliver or direct the Deposit
Takers to deliver such proceeds to Extreme or other Persons entitled thereto by
law.

            ARTICLE III DETERMINATION OF THE COLLATERAL PERCENTAGE

     Section 3.1  Determination of the Collateral Percentage Generally.
                  ----------------------------------------------------
Effective as of the date of this Agreement, and until a new Collateral
Percentage becomes effective, the Collateral Percentage is 100%. Subject to the
provisions of this Article III, Extreme may from time to time designate a new
Collateral Percentage which is any multiple of 10% from 0% to 100% (i.e., 0%,
10%, 20%, 30%, etc.) by written notice delivered to Agent, BNPLC and the
Participants in the form of ATTACHMENT 3. Any new Collateral Percentage so
                            ------------
designated shall not become effective, however, until the commencement of the

                                      -7-
<PAGE>

next following Base Rent Period which is at least ten Business Days after the
receipt of such notice by Agent, BNPLC and the Participants. Further, if Extreme
provides more than one notice of a change in the Collateral Percentage to be
effective on a the first day of a particular Base Rent Period, then the latest
such notice from Extreme which satisfies the requirements of the preceding
sentence (and of Sections 3.2 and 3.3) will control. Without limiting mandatory
changes in the Collateral Percentage required by Section 3.3, in no event shall
the Collateral Percentage be changed more often than once in any calendar
quarter because of any election by Extreme to designate a new Collateral
Percentage as provided in this Section. After any Collateral Percentage becomes
effective as provided in this Article, it shall remain in effect until a
different Collateral Percentage becomes effective as provided in this Article.

     Section 3.2  Limitations on Extreme's Right to Lower the Collateral
                  ------------------------------------------------------
Percentage. Notwithstanding the foregoing, no designation by Extreme of a new
----------
Collateral Percentage will be effective to reduce the Collateral Percentage if
the designation is given, or the reduction would otherwise become effective, on
or after the Designated Sale Date or when any of the following shall have
occurred and be continuing:

          3.2.1  any Material Lease Default;

          3.2.2  any Event of Default under and as defined in this Agreement;

          3.2.3  any Default under and as defined in this Agreement -excluding,
     however, any such Default limited to a failure of Extreme described in
     clause (c) or clause (e) of the definition of Event of Default above, with
     respect to which the time for cure specified in clause (c) or clause (e),
     as applicable, has not expired.

     Section 3.3  Minimum Collateral Percentages Dependent Upon the Adjusted
                  ----------------------------------------------------------
EBITDAR Coverage Ratio. NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN
----------------------
CONTAINED, THE COLLATERAL PERCENTAGE SHALL NOT BE LESS THAN THE MINIMUM
COLLATERAL PERCENTAGE ESTABLISHED FROM TIME TO TIME AS DESCRIBED IN PART III OF
SCHEDULE 1. Accordingly, and because a new Base Rent Period will begin on the
----------
first Business Day of the first calendar month following any Failed Collateral
Test Date as provided in subparagraph 3(c)(ii)a) of the Land Lease, Extreme
                         -----------------------
shall be required by Section 5.1 to deliver additional Collateral on the first
Business Day of the first calendar month after any Failed Collateral Test Date.

                ARTICLE IV PROVISIONS CONCERNING DEPOSIT TAKERS

     Section 4.1  Qualification of Deposit Takers Generally. Agent may decline
                  -----------------------------------------
to deposit or maintain Collateral hereunder with any Person designated as a
Deposit Taker, if such Person has failed to satisfy or no longer satisfies the
following requirements:

          4.1.1  Such Person must have received from Agent and Extreme a
     completed, executed Notice of Security Interest in the form of ATTACHMENT 4
                                                                    ------------
     (a "Notice of Security Interest") which specifically identifies any and all
     Accounts in which such Person shall hold Cash Collateral delivered to it
     pursuant to this Agreement and which designates Account Offices with
     respect to all such Accounts in New York or California.

          4.1.2  Such Person must have executed the Acknowledgment and Agreement
     at the end of such Notice of Security Interest (the "Deposit Taker's
     Acknowledgment and Agreement") and returned the same to Agent. Further,
     such Person must have complied with the Deposit Taker's Acknowledgment and
     Agreement, and the representations set forth therein with respect to such
     Person must continue to be true and correct.

                                      -8-
<PAGE>

          4.1.3  Such Person must be a commercial bank, organized under the laws
     of the United States of America or a state thereof or under the laws of
     another country which is doing business in the United States of America;
     must be authorized to maintain deposit accounts for others through Account
     Offices in New York or California (as specified in the Deposit Taker's
     Acknowledgment and Agreement); and must be an Affiliate of BNPLC or the
     Participant for whom such Person will act as Deposit Taker or must have a
     combined capital, surplus and undivided profits of at least $500,000,000.

          4.1.4  Such Person must have complied with the provisions in this
     Agreement applicable to Deposit Takers, including the provisions of Section
     5.4 concerning the issuance and redemption of Certificates of Deposit.

     Section 4.2  Existing Deposit Takers. BNPLC's Parent (as Deposit Taker for
                  -----------------------
itself and for BNPLC) has received a Notice of Security Agreement dated the
Effective Date and has responded to such a notice with a Deposit Taker's
Acknowledgment and Agreement dated the Effective Date, as contemplated in
subsections 4.1.1 and 4.1.2.

     Section 4.3  Replacement of Participants Proposed by Extreme. So long as no
                  -----------------------------------------------
Event of Default has occurred and is continuing, BNPLC shall not unreasonably
withhold its approval for a substitution under the Participation Agreement of a
new Participant proposed by Extreme for any Participant, the Deposit Taker for
whom would no longer meet the requirements for an Initially Qualified Deposit
Taker; provided, however, that (A) the proposed substitution can be accomplished
without a release or breach by BNPLC of its rights and obligations under the
Participation Agreement; (B) the new Participant will agree (by executing a
Supplement and a supplement to the Participation Agreement as contemplated
therein and by other agreements as may be reasonably required by BNPLC and
Extreme) to become a party to the Participation Agreement and to this Agreement,
to designate an Initially Qualified Deposit Taker as the Deposit Taker for it
under this Agreement and to accept a Percentage under the Participation
Agreement equal to the Percentage of the Participant to be replaced; (C) the new
Participant (or Extreme) will provide the funds required to pay the termination
fee by Section 6.4 of the Participation Agreement to accomplish the
       -----------
substitution; (D) Extreme (or the new Participant) agrees in writing to
indemnify and defend BNPLC for any and all Losses incurred by BNPLC in
connection with or because of the substitution, including the cost of preparing
supplements to the Participation Agreement and this Agreement and including any
cost of defending and paying any claim asserted by the Participant to be
replaced because of the substitution (but not including any liability of BNPLC
to such Participant for damages caused by BNPLC's bad faith or gross negligence
in the performance of BNPLC's obligations under the Participation Agreement
prior to the substitution); (E) the new Participant shall be a reputable
financial institution having a net worth of no less than seven and one half
percent (7.5%) of total assets and total assets of no less than
$10,000,000,000.00 (all according to then recent audited financial statements);
and (F) in no event will BNPLC be required to approve a substitution pursuant to
this Section 4.3 which will replace a Participant that is an Affiliate of BNPLC.
BNPLC shall attempt in good faith to assist (and cause BNPLC's Parent to attempt
in good faith to assist) Extreme in identifying a new Participant that Extreme
may propose to substitute for an existing Participant pursuant to this Section,
as Extreme may reasonably request from time to time. However, in no event shall
BNPLC itself, or any of its Affiliates, be required to take the Percentage of
any Participant to be replaced.

     Section 4.4  Mandatory Substitution for Disqualified Deposit Takers. If any
                  ------------------------------------------------------
Deposit Taker shall cease to satisfy the requirements set forth in Section 4.1,
the party for whom such Disqualified Deposit Taker has been designated as
Deposit Taker (i.e., BNPLC or the applicable Participant) shall promptly (1)
provide notice thereof to Agent and Extreme, and (2) designate a substitute
Deposit Taker and cause the substitute to satisfy the requirements set forth in
Section 4.1. Pending the designation of the substitute and the satisfaction by
it of the requirements set forth in Section 4.1, Agent may withdraw Collateral
held by

                                      -9-
<PAGE>

the Disqualified Deposit Taker and deposit such Collateral with other Deposit
Takers, subject to Section 5.3 below.

         Section 4.5 Voluntary Substitution of Deposit Takers. With the written
                     ----------------------------------------
approval of Agent, which approval will not be unreasonably withheld, BNPLC or
any Participant may at any time designate for itself a new Deposit Taker (in
replacement of any prior Deposit Taker acting for it hereunder); provided, the
Person so designated has satisfied the requirements set forth in Section 4.1;
and, provided further, unless the designation of a new Deposit Taker is required
by Section 4.4 to replace a Disqualified Deposit Taker, at the time of the
replacement such Person must be an Initially Qualified Deposit Taker.

         Section 4.6 Delivery of Notice of Security Interest by Extreme and
                     ------------------------------------------------------
Agent. To the extent required for the designation of a new Deposit Taker by
-----
BNPLC or any Participant pursuant to Section 4.5, or to permit the substitution
or replacement of a Deposit Taker for BNPLC or any Participant as provided in
Sections 4.4 and 4.5, Extreme and Agent shall promptly execute and deliver any
properly completed Notice of Security Interest requested by BNPLC or the
applicable Participant.

         Section 4.7 Constructive Possession of Collateral. The possession by a
                     -------------------------------------
Deposit Taker of any deposit accounts, money, instruments, chattel paper or
other property constituting Collateral or evidencing Collateral shall be deemed
to be possession by Agent or a person designated by Agent, for purposes of
perfecting the security interest granted to Agent hereunder pursuant to the UCC
or other Applicable Law; and notifications to a Deposit Taker by other Persons
holding any such property, and Acknowledgments, receipts or confirmations from
any such Persons delivered to a Deposit Taker, shall be deemed notifications to,
or Acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of such Deposit Taker for the benefit of Agent
for the purposes of perfecting such security interests under Applicable Law.

         Section 4.8 Attempted Setoff by Deposit Takers. By delivery of a
                     ----------------------------------
Deposit Taker's Acknowledgment and Agreement, each Deposit Taker shall be
required to agree not to setoff or attempt a setoff, without in each case first
                                                     --------------------------
obtaining the prior written authorization of Agent, Secured Obligations owed to
--------------------------------------------------
it against any Collateral held by it from time to time. Further, by delivery of
a Deposit Taker's Acknowledgment and Agreement, each Deposit Taker shall be
required to agree not to setoff or attempt a setoff, without in each case first
                                                     --------------------------
obtaining the prior written authorization of both Extreme and Agent, obligations
-------------------------------------------------------------------
owed to it other than Secured Obligations against any Collateral held by it from
time to time. Any Deposit Taker for BNPLC or a Participant shall not be
permitted by BNPLC or the applicable Participant, as the case may be, to violate
such agreements. However, Extreme acknowledges and agrees (without limiting its
right to recover damages from a Deposit Taker that violates such agreements)
that Agent shall not be responsible for, or be deemed to have taken any action
against Extreme because of, any Deposit Taker's violation of such agreements;
and, neither BNPLC nor any Participant shall be responsible for, or be deemed to
have taken any action against Extreme because of, any violation of such
agreements by a Deposit Taker for another party.

         Section 4.9 Deposit Taker Losses. Agent shall not be responsible for
                     --------------------
any Deposit Taker Losses. However, Deposit Taker Losses with respect to a
Deposit Taker for a particular Participant shall reduce the amount of BNPLC's
Corresponding Obligations to Participants which are payable to such Participant
as provided in Section 2.2 of the Participation Agreement. Further, when Deposit
               -----------
Taker Losses with respect to a Deposit Taker for a particular Participant are
incurred in excess of the payments of Secured Obligations that such Participant
would then have been entitled to receive under the Participation Agreement but
for such Deposit Taker Losses, such Participant must immediately pay the excess
to Agent as additional Collateral hereunder, failing which Extreme may recover
any damages suffered by it because of the Deposit Taker Losses from such Deposit
Taker or such Participant.

                                     -10-
<PAGE>

         Section 4.10 Losses Resulting from Failure of Deposit Taker to Comply
                      --------------------------------------------------------
with this Agreement. Any Participant, the Deposit Taker for whom has failed to
-------------------
comply with the requirements of this Agreement or any Notices of Security
Interest and any Deposit Taker's Acknowledgments and Agreements (the
"Responsible Participant") must defend, indemnify, and hold harmless BNPLC,
Agent and the other Participants from and against any Losses resulting from such
failure. Without limiting the foregoing, if the failure of a Deposit Taker for a
Responsible Participant to comply strictly with the terms of this Agreement
(including, without limitation, the provisions of Section 5.4 concerning the
issuance and redemption of Certificates of Deposit and the requirement that any
cash deposits be held in a deposit account located in either New York or
California) causes, in whole or in part, the security interest of Agent in the
Collateral held by such Deposit Taker to be unperfected, then any and all Losses
suffered as a result of such nonperfection shall be borne solely by the
Responsible Participant and shall not be shared by BNPLC, Agent or the other
Participants.

            ARTICLE V   DELIVERY AND MAINTENANCE OF CASH COLLATERAL

         Section 5.1 Delivery of Funds by Extreme. On the first day of any Base
                     ----------------------------
Rent Period, and on any other date designated in a notice given by Agent to
Extreme at least three Business Days prior to the date so designated, Extreme
must deliver to Agent, subject to the pledge and security interest created
hereby, funds as Cash Collateral then needed (if any) to cause the Value of the
Collateral to be no less than the Minimum Collateral Value. Each delivery of
funds required by the preceding sentence must be received by Agent no later than
12:00 noon (San Francisco time) on the date it is required; if received after
12:00 noon it will be considered for purposes of the Improvements Lease as
received on the next following Business Day. At least five Business Days prior
to the first day of any Base Rent Period upon which it is expected that Extreme
will be required to deliver additional funds pursuant to this Section, Extreme
shall notify BNPLC, Agent and each of the Participants thereof and of the amount
Extreme expects to deliver to Agent as Cash Collateral on the applicable Base
Rent Date. In addition to required deliveries of Cash Collateral as provided in
the foregoing provisions, Extreme may on any date (whether or not the first day
of a Base Rent Period) deliver additional Cash Collateral to Agent as necessary
to prevent any Default from becoming an Event of Default. Upon receipt of any
funds delivered to it by Extreme as Cash Collateral, Agent shall immediately
deposit the same with the Deposit Takers in accordance with the requirements of
Sections 5.3 and 5.4 below.

         Section 5.2 Transition Account. Pending deposit in the Accounts or
                     ------------------
other application as provided herein, all Cash Collateral received by Agent
shall be credited to and held by Agent in an account (the "Transition Account")
styled "Extreme Collateral Account, held for the benefit of BNP Leasing
Corporation and the Participants," separate and apart from all other property
and funds of Extreme or other Persons, and no other property or funds shall be
deposited in the Transition Account. The books and records of Agent shall
reflect that the Transition Account and all Cash Collateral on deposit therein
are owned by Extreme, subject to a pledge and security interest in favor of
Agent for the benefit of BNPLC and Participants.

         Section 5.3 Allocation of Cash Collateral Among Deposit Takers. Funds
                     --------------------------------------------------
received by Agent from Extreme as Cash Collateral will be allocated for deposit
among the Deposit Takers as follows:

         first, to the extent possible the funds will be allocated as required
         -----
         to rectify and prevent any Collateral Imbalance; and

         second, the funds will be allocated to the Deposit Taker for BNPLC,
         ------
         unless the Deposit Taker for BNPLC has become a Disqualified Deposit
         Taker, in which case the funds will be allocated to other Deposit
         Takers who are not Disqualified Deposit Takers as Agent deems
         appropriate.

                                     -11-
<PAGE>

Further, if for any reason a Collateral Imbalance is determined by Agent to
exist, Agent shall, as required to rectify or mitigate the Collateral Imbalance,
promptly reallocate Collateral among Deposit Takers by withdrawing Cash
Collateral from some Accounts and redepositing it in other Accounts. (If any
party to this Agreement believes that the Value of the Accounts held by a
particular Deposit Taker causes a Collateral Imbalance to exist, that party will
promptly notify BNPLC, Extreme and Agent.) Subject to the foregoing, and
provided that Agent does not thereby create or exacerbate a Collateral
Imbalance, Agent may withdraw and redeposit Cash Collateral in order to
reallocate the same among Deposit Takers from time to time as Agent deems
appropriate. For purposes of illustration only, examples of the allocations
required by this Section are set forth in ATTACHMENT 5.
                                          ------------

         Section 5.4 Issuance and Redemption of Certificates of Deposit. Upon
                     --------------------------------------------------
the receipt of any deposit of Cash Collateral from Agent, each Deposit Taker
shall issue a Certificate of Deposit evidencing the Account into which such
deposit is made and deliver such Certificate of Deposit to Agent for the benefit
of BNPLC and the Participants. Each Certificate of Deposit shall be issued in an
amount equal to the Value of the Account which it evidences and shall otherwise
be in the form set forth as ATTACHMENT 1 to this Agreement. Upon depositing any
                            ------------
Cash Collateral into an Account that is already evidenced by an outstanding
Certificate of Deposit, Agent will surrender the outstanding Certificate of
Deposit, and in exchange the Deposit Taker receiving the deposit will issue a
new Certificate of Deposit, evidencing the total amount of Cash Collateral in
the Account after the deposit. A Deposit Taker that has issued a Certificate of
Deposit may require the surrender of the Certificate of Deposit as a condition
to a withdrawal from the Account evidenced thereby, including any withdrawal
required or permitted by this Agreement. Upon surrender of a Certificate of
Deposit in connection with a withdrawal of less than all of the Cash Collateral
in the Account evidenced thereby, the applicable Deposit Taker will concurrently
issue a new Certificate of Deposit to Agent, evidencing the balance of the Cash
Collateral remaining on deposit in the Account after the withdrawal.
Notwithstanding the foregoing, if any Certificate of Deposit held by Agent shall
be destroyed, lost or stolen, the Deposit Taker that issued the Certificate,
upon the written request of Agent, shall issue a new Certificate of Deposit to
Agent in lieu of and in substitution for the Certificate of Deposit so
destroyed, lost or stolen. However, as applicant for the substitute Certificate
of Deposit, Agent must indemnify (at no cost to Extreme) the applicable Deposit
Taker against any liability on the Certificate of Deposit destroyed, lost or
stolen, and Agent shall furnish to the Deposit Taker an affidavit of an officer
of Agent setting forth the fact of destruction, loss or theft and confirming the
status of Agent as holder of the Certificate of Deposit immediately prior to the
destruction, loss or theft. If any Certificate of Deposit held by Agent shall
become mutilated, the Deposit Taker that issued the Certificate, upon the
written request of Agent, shall issue a new Certificate of Deposit to Agent in
exchange and substitution for the mutilated Certificate of Deposit. Agent shall
hold all Certificates of Deposit for the benefit of BNPLC and the Participants,
subject to the pledge and security interest created hereby.

         Section 5.5 Status of the Accounts Under the Reserve Requirement
                     ----------------------------------------------------
Regulations. Deposit Takers shall be permitted to structure the Accounts as
-----------
nonpersonal time deposits under 12 C.F.R., Part II, Chapter 204 (commonly known
as "Regulation D"). Accordingly, each Deposit Taker may require at least seven
days advance notice of any withdrawal or transfer of funds from Accounts it
maintains and may limit the number of withdrawals or transfers from such
Accounts to no more than six in any calendar month, notwithstanding anything to
the contrary herein or in any deposit agreement that Extreme and any Deposit
Taker may enter into with respect to any Account. As necessary to satisfy the
seven days notice requirement with respect to withdrawals by Agent when required
by Extreme pursuant to the provisions below, Agent shall notify Deposit Takers
promptly after receipt of any notice from Extreme described in subsection 6.1.2
or 6.2.1 or in Section 6.3.

         Section 5.6 Acknowledgment by Extreme that Requirements of this
                     ---------------------------------------------------
Agreement are Commercially Reasonable. Extreme acknowledges and agrees that the
-------------------------------------
requirements set forth herein concerning receipt,

                                     -12-
<PAGE>

deposit, withdrawal, allocation, application and distribution of Cash Collateral
by Agent, including the requirements and time periods set forth in the next
Article, are commercially reasonable.

                  ARTICLE VI   WITHDRAWAL OF CASH COLLATERAL

Extreme may not withdraw Cash Collateral, except as follows:

     Section 6.1 Withdrawal of Collateral Prior to the Designated Sale Date.
                 ----------------------------------------------------------
Extreme may require Agent to present Certificates of Deposit for payment and
withdraw Cash Collateral from Accounts on any date prior to the Designated Sale
Date and to deliver such Cash Collateral to Extreme (which delivery shall be
free and clear of all liens and security interests hereunder); provided,
however, that in each case:

          6.1.1 Such withdrawal and delivery of the Cash Collateral to Extreme
     will not cause the Value of the remaining Collateral to be less than the
     Minimum Collateral Value.

          6.1.2 by a notice in the form of ATTACHMENT 6, Extreme must give
                                           ------------
     Agent, BNPLC and the Participants notice of the required withdrawal at
     least ten days prior to the date upon which the withdrawal is to occur.

          6.1.3 No Default or Event of Default shall have occurred and be
     continuing at the time Extreme gives the notice required by the preceding
     subsection or on the date upon which the withdrawal is required.

          6.1.4 Extreme must pay to Agent any and all costs incurred by
     Agent in connection with the withdrawal.

          6.1.5 Agent shall determine the Accounts from which to make any
     withdrawal required by Extreme pursuant to this Section as necessary to
     prevent or mitigate any Collateral Imbalance.

     Section 6.2 Withdrawal and Application of Cash Collateral to Reduce or
                 ----------------------------------------------------------
Satisfy the Secured Obligations to the Participants. To reduce the "Break Even
---------------------------------------------------
Price" or "Supplemental Payment" required under (and as defined in) the Purchase
Agreement (and, thus, to reduce the Secured Obligations), Extreme may require
Agent to withdraw Cash Collateral then held by or for Agent pursuant to this
Agreement on the Designated Sale Date and to deliver the same on the Designated
Sale Date or on any date thereafter prior to an Event of Default (which delivery
shall be free and clear of all liens and security interests hereunder) directly
to the Participants in proportion to their respective rights to payment of
BNPLC's Corresponding Obligations to Participants and for application thereto or
the reduction thereof pursuant to Section 2.2 of the Participation Agreement;
                                  -----------
provided, that:

          6.2.1 by a notice in the form of ATTACHMENT 7, Extreme must have
                                           ------------
     notified Agent, BNPLC and each of the Participants of the required
     withdrawal and payment to Participants at least ten days prior to the date
     upon which it is to occur;

          6.2.2 the required withdrawal shall be made as determined by Agent,
     first, from the Accounts maintained by the Deposit Takers for the
     Participants, and then (to the extent necessary) from the Accounts
     maintained by the Deposit Taker for BNPLC; and

          6.2.3 in any event, no withdrawals or payments directly to
     Participants shall be required by this Section 6.2 (or permitted over the
     objection of BNPLC) in excess of those required to satisfy BNPLC's
     Corresponding Obligations to Participants or to reduce such obligations to
     zero under the Participation Agreement.

                                     -13-
<PAGE>

          Section 6.3 Withdrawal and Application of Cash Collateral to Reduce or
                      ----------------------------------------------------------
Satisfy the Secured Obligations to BNPLC. To satisfy Extreme's Purchase
----------------------------------------
Agreement Obligations, Extreme may require Agent to withdraw any Cash Collateral
held by the Deposit Taker for BNPLC pursuant to this Agreement on the Designated
Sale Date and to deliver the same on the Designated Sale Date or on any date
thereafter prior to an Event of Default (which delivery shall be free and clear
of all liens and security interests hereunder) directly to BNPLC as a payment on
behalf of Extreme of amounts due under the Purchase Agreement; provided, that by
a notice in the form of ATTACHMENT 8, Extreme must have notified Agent and BNPLC
of the required withdrawal and payment to BNPLC at least ten days prior to the
date upon which it is to occur.

          Section 6.4 Withdrawal of Cash Collateral From Accounts Maintained by
                      ---------------------------------------------------------
Disqualified Deposit Takers. Extreme may from time to time prior to the
---------------------------
Designated Sale Date (regardless of the existence of any Default or Event of
Default) require Agent to withdraw any or all Cash Collateral from any Account
maintained by a Disqualified Deposit Taker and deposit it, still subject to the
pledge and grant of security interest hereunder, with other Deposit Takers who
are not Disqualified Deposit Takers (in accordance with the requirements of
Sections 5.3 and 5.4) on any date prior to the Designated Sale Date; provided,
that by a notice in the form of ATTACHMENT 9, Extreme must have notified Agent,
BNPLC and each of the Participants of the required withdrawal at least ten days
prior to the date upon which it is to occur.

            ARTICLE VII   REPRESENTATIONS AND COVENANTS OF EXTREME

     Section 7.1  Representations of Extreme. Extreme represents to BNPLC, Agent
                  --------------------------
and the Participants as follows:

          7.1.1 Extreme is the legal and beneficial owner of the Collateral (or,
     in the case of after-acquired Collateral, at the time Extreme acquires
     rights in the Collateral, will be the legal and beneficial owner thereof).
     No other Person has (or, in the case of after-acquired Collateral, at the
     time Extreme acquires rights therein, will have) any right, title, claim or
     interest (by way of Lien, purchase option or otherwise) in, against or to
     the Collateral, except for rights created hereunder.

          7.1.2 Agent has (or in the case of after-acquired Collateral, at the
     time Extreme acquires rights therein, will have) a valid, first priority,
     perfected pledge of and security interest in the Collateral, regardless of
     the characterization of the Collateral as deposit accounts, instruments or
     general intangibles under the UCC, but assuming that the representations of
     each Deposit Taker in its Deposit Taker's Acknowledgment and Agreement are
     true.

          7.1.3 Extreme has delivered to Agent, together with all necessary
     stock powers, endorsements, assignments and other necessary instruments of
     transfer, the originals of all documents, instruments and agreements
     evidencing Accounts, Certificates of Deposit or Cash Collateral.

          7.1.4 Extreme's chief executive office is located at the address of
     Extreme set forth in Article II of the Common Definitions and Provisions
     Agreement (Land) or at another address in California specified in a notice
     that Extreme has given to Agent as required by Section 7.2.4.

          7.1.5 To the knowledge of Extreme, neither the ownership or the
     intended use of the Collateral by Extreme, nor the pledge of Accounts or
     the grant of the security interest by Extreme to Agent herein, nor the
     exercise by Agent of its rights or remedies hereunder, will (i) violate any
     provision of (a) Applicable Law, (b) the articles or certificate of
     incorporation, charter or bylaws of Extreme, or (c) any agreement,
     judgment, license, order or permit applicable to or binding upon Extreme,
     or (ii) result in or require the creation of any Lien, charge or
     encumbrance upon any

                                     -14-
<PAGE>

     assets or properties of Extreme except as expressly contemplated in this
     Agreement. Except as expressly contemplated in this Agreement, to the
     knowledge of Extreme no consent, approval, authorization or order of, and
     no notice to or filing with any court, governmental authority or third
     party is required in connection with the pledge or grant by Extreme of the
     security interest contemplated herein or the exercise by Agent of its
     rights and remedies hereunder.

     Section 7.2  Covenants of Extreme.  Extreme hereby agrees as follows:
                  --------------------

          7.2.1 Extreme, at Extreme's expense, shall promptly procure, execute
     and deliver to Agent all documents, instruments and agreements and perform
     all acts which are necessary, or which Agent may reasonably request, to
     establish, maintain, preserve, protect and perfect the Collateral, the
     pledge thereof to Agent or the security interest granted to Agent therein
     and the first priority of such pledge or security interest or to enable
     Agent to exercise and enforce its rights and remedies hereunder with
     respect to any Collateral. Without limiting the generality of the preceding
     sentence, Extreme shall (A) procure, execute and deliver to Agent all stock
     powers, endorsements, assignments, financing statements and other
     instruments of transfer requested by Agent, (B) deliver to Agent promptly
     upon receipt all originals of Collateral consisting of instruments,
     documents and chattel paper, (C) cause the security interest of Agent in
     any Collateral consisting of securities to be recorded or registered in the
     books of any financial intermediary or clearing corporation requested by
     Agent, and (D) reimburse Agent upon request for any legal opinion Agent may
     elect to obtain from a nationally recognized commercial law firm authorized
     to practice in New York concerning the enforceability, first priority and
     perfection of Agent's security interest in any Collateral maintained in New
     York, if BNPLC or any Participant should at any time elect to use a Deposit
     Taker that will maintain one or more Accounts in New York.

          7.2.2 Extreme shall not use or consent to any use of any Collateral in
     violation of any provision of this Agreement or any other Transaction
     Document or any Applicable Law.

          7.2.3 Extreme shall pay promptly when due all taxes and other
     governmental charges, all Liens and all other charges now or hereafter
     imposed upon, relating to or affecting any Collateral.

          7.2.4 Without thirty days' prior written notice to Agent, Extreme
     shall not change Extreme's name or place of business (or, if Extreme has
     more than one place of business, its chief executive office).

          7.2.5 Extreme shall appear in and defend, on behalf of Agent, any
     action or proceeding which may affect Extreme's title to or Agent's
     interest in the Collateral.

          7.2.6 Subject to the express rights of Extreme under Article VI,
     Extreme shall not surrender or lose possession of (other than to Agent or a
     Deposit Taker pursuant hereto), sell, encumber, lease, rent, option, or
     otherwise dispose of or transfer any Collateral or right or interest
     therein, and Extreme shall keep the Collateral free of all Liens.

          7.2.7 Extreme will not take any action which would in any manner
     impair the value or enforceability of Agent's pledge of or security
     interest in any Collateral, nor will Extreme fail to take any action which
     is required to prevent (and which Extreme knows is required to prevent) an
     impairment of the value or enforceability of Agent's pledge of or security
     interest in any Collateral.

          7.2.8 Extreme shall pay (and shall indemnify and hold harmless Agent
     from and against) all Losses incurred by Agent in connection with or
     because of (A) the interest acquired by Agent in any Collateral pursuant to
     this Agreement, or (B) the negotiation or administration of this Agreement,
     whether such Losses are incurred at the time of execution of this Agreement
     or at any

                                     -15-
<PAGE>

     time in the future. Costs and expenses included in such Losses may include,
     without limitation, all filing and recording fees, taxes, UCC search fees
     and Attorneys' Fees incurred by Agent with respect to the Collateral.

          7.2.9 Without limiting the foregoing, within five Business Days after
     Extreme becomes aware of any failure of the pledge or security interest
     contemplated herein in the Transition Account or any Account, Certificate
     of Deposit or Cash Collateral to be a valid, perfected, first priority
     pledge or security interest (regardless of the characterization of the
     Transition Account or any Accounts, Certificates of Deposit or Cash
     Collateral as deposit accounts, instruments or general intangibles under
     the UCC), Extreme shall notify Agent, BNPLC and the Participants of such
     failure. In addition, if the failure would not exist but for Extreme's
     delivery of Cash Collateral to Agent subject to prior Liens or other claims
     by one or more third parties, or but for the grant by Extreme itself of any
     Lien or other interest in the Collateral to one or more third parties,
     then, in addition to any other remedies available to BNPLC or Agent under
     the circumstances, Extreme must pay to BNPLC any additional Base Rent that
     has accrued under the Land Lease because of (or that would have accrued if
     BNPLC had been aware of) the failure, together with interest at the Default
     Rate on any such additional Base Rent.

                  ARTICLE VIII    AUTHORIZED ACTION BY AGENT

     Section 8.1 Power of Attorney. Extreme hereby irrevocably appoints Agent as
                 -----------------
Extreme's attorney-in-fact for the purpose of authorizing Agent to perform (but
Agent shall not be obligated to and shall incur no liability to Extreme or any
third party for failure to perform) any act which Extreme is obligated by this
Agreement to perform, and to exercise, consistent with the other provisions of
this Agreement, such rights and powers as Extreme might exercise with respect to
the Collateral during any period in which a Default or Event of Default has
occurred and is continuing, including the right to (a) collect by legal
proceedings or otherwise and endorse, receive and receipt for all dividends,
interest, payments, proceeds and other sums and property now or hereafter
payable on or on account of the Collateral; (b) enter into any extension,
reorganization, deposit, merger, consolidation or other agreement pertaining to,
or deposit, surrender, accept, hold or apply other property in exchange for the
Collateral; (c) insure, process, preserve and enforce the Collateral; (d) make
any compromise or settlement, and take any action it deems advisable, with
respect to the Collateral; (e) pay any indebtedness of Extreme relating to the
Collateral; and (f) execute UCC financing statements and other documents,
instruments and agreements required hereunder. Extreme agrees that such care as
Agent gives to the safekeeping of its own property of like kind shall constitute
reasonable care of the Collateral when in Agent's possession; provided, however,
                                                              --------  -------
that Agent shall not be obligated to Extreme to give any notice or take any
action to preserve rights against any other Person in connection with the
Secured Obligations or with respect to the Collateral.

                      ARTICLE IX    DEFAULT AND REMEDIES

     Section 9.1 Remedies. In addition to all other rights and remedies granted
                 --------
to Agent, BNPLC or the Participants by this Agreement, the Land Lease, the
Purchase Agreement, the Participation Agreement, the UCC and other Applicable
Laws, Agent may, upon the occurrence and during the continuance of any Event of
Default, exercise any one or more of the following rights and remedies, all of
which will be in furtherance of its rights as a secured party under the UCC:

          (a) Agent may collect, receive, appropriate or realize upon the
     Collateral or otherwise foreclose or enforce the pledge of or security
     interests in any or all Collateral in any manner permitted by Applicable
     Law or in this Agreement; and

                                     -16-
<PAGE>

          (b) Agent may notify any or all Deposit Takers to pay all or any
     portion of the Collateral held by such Deposit Taker(s) directly to Agent.

Agent shall distribute the proceeds of all Collateral received by Agent after
the occurrence of an Event of Default to BNPLC and the Participants for
application to the Secured Obligations. If any proceeds of Collateral remain
after all Secured Obligations have been paid in full, Agent will deliver or
direct the Deposit Takers to deliver such proceeds to Extreme or other Persons
entitled thereto. In any case where notice of any sale or disposition of any
Collateral is required, Extreme hereby agrees that seven (7) Business Days
notice of such sale or disposition is reasonable.

                          ARTICLE X    OTHER RECOURSE


     Section 10.1 Recovery Not Limited. To the fullest extent permitted by
                  --------------------
applicable law, Extreme waives any right to require that Agent, BNPLC or the
Participants proceed against any other Person, exhaust any Collateral or other
security for the Secured Obligations, or to have any Other Liable Party joined
with Extreme in any suit arising out of the Secured Obligations or this
Agreement, or pursue any other remedy in their power. Extreme waives any and all
notice of acceptance of this Agreement. Extreme further waives notice of the
creation, modification, rearrangement, renewal or extension for any period of
any of the Secured Obligations of any Other Liable Party from time to time and
any defense arising by reason of any disability or other defense of any Other
Liable Party or by reason of the cessation from any cause whatsoever of the
liability of any Other Liable Party. Until all of the Secured Obligations shall
have been paid in full, Extreme shall have no right to subrogation,
reimbursement, contribution or indemnity against any Other Liable Party and
Extreme waives the right to enforce any remedy which Agent, BNPLC or any
Participant has or may hereafter have against any Other Liable Party, and waives
any benefit of and any right to participate in any other security whatsoever now
or hereafter held by Agent, BNPLC or any Participant. Extreme authorizes Agent,
BNPLC and the Participants, without notice or demand and without any reservation
of rights against Extreme and without affecting Extreme's liability hereunder or
on the Secured Obligations, from time to time to (a) take or hold any other
property of any type from any other Person as security for the Secured
Obligations, and exchange, enforce, waive and release any or all of such other
property, (b) after any Event of Default, apply or require the application of
the Collateral (in accordance with this Agreement) or such other property in any
order they may determine and to direct the order or manner of sale thereof as
they may determine, (c) renew, extend for any period, accelerate, modify,
compromise, settle or release any of the obligations of any Other Liable Party
with respect to any or all of the Secured Obligations or other security for the
Secured Obligations, and (d) release or substitute any Other Liable Party.

                   ARTICLE XI   PROVISIONS CONCERNING AGENT

     In the event of any conflict between the following and other provisions in
this Agreement, the following will control:

     Section 11.1 Appointment and Authority. BNPLC and each Participant hereby
                  -------------------------
irrevocably authorizes Agent, and Agent hereby undertakes, to take all actions
and to exercise such powers under this Agreement as are specifically delegated
to Agent by the terms hereof, together with all other powers reasonably
incidental thereto. The relationship of Agent to the Participants is only that
of one commercial bank acting as collateral agent for others, and nothing herein
shall be construed to constitute Agent a trustee or other fiduciary for any
Participant or anyone claiming through or under a Participant nor to impose on
Agent duties and obligations other than those expressly provided for in this
Agreement. With respect to any matters not expressly provided for in this
Agreement and any matters which this Agreement places within the discretion of
Agent, Agent shall not be required to exercise any discretion or take any
action, and it may request instructions from BNPLC and Participants with respect
to any such matter, in

                                     -17-
<PAGE>

which case it shall be required to act or to refrain from acting (and shall be
fully protected and free from liability to all Participants in so acting or
refraining from acting) upon the instructions of the Majority, as defined in the
Participation Agreement, including itself as a Participant and BNPLC; provided,
however, that Agent shall not be required to take any action which exposes it to
a risk of personal liability that it considers unreasonable or which is contrary
to this Agreement or the other documents referenced herein or to Applicable Law.

     Section 11.2 Exculpation, Agent's Reliance, Etc. Neither Agent nor any of
                  ----------------------------------
its directors, officers, agents, attorneys, or employees shall be liable for any
action taken or omitted to be taken by any of them under or in connection with
this Agreement, INCLUDING THEIR NEGLIGENCE OF ANY KIND, except that each shall
be liable for its own gross negligence or willful misconduct. Without limiting
the generality of the foregoing, Agent (1) may treat the rights of any
Participant under its Participation Agreement as continuing until Agent receives
written notice of the assignment or transfer of those rights in accordance with
such Participation Agreement, signed by such Participant and in form
satisfactory to Agent; (2) may consult with legal counsel (including counsel for
Extreme), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts, unless
the action taken or omitted constitutes misconduct; (3) makes no warranty or
representation and shall not be responsible for any statements, warranties or
representations made in or in connection with this Agreement or the other
documents referenced herein; (4) shall not have any duty to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions of the Transaction Documents on the part of any party thereto, or to
inspect the property (including the books and records) of any party thereto; (5)
shall not be responsible to any Participant for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of any Transaction
Document or any instrument or document furnished in connection therewith; (6)
may rely upon the representations and warranties of Extreme, Participants and
Deposit Takers in exercising its powers hereunder; and (7) shall incur no
liability under or in respect of the Transaction Documents by acting upon any
notice, consent, certificate or other instrument or writing (including any
telecopy, telegram, cable or telex) believed by it to be genuine and signed or
sent by the proper Person or Persons.

     Section 11.3 Participant's Credit Decisions. Each Participant acknowledges
                  ------------------------------
that it has, independently and without reliance upon Agent or any other
Participant, made its own analysis of Extreme and the transactions contemplated
hereby and its own independent decision to enter into the Transaction Documents
to which it is a party. Each Participant also acknowledges that it will,
independently and without reliance upon Agent or any other Participant and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Transaction Documents.

     Section 11.4 Indemnity. Each Participant agrees to indemnify Agent (to the
                  ---------
extent not reimbursed by Extreme within ten days after demand) from and against
such Participant's Percentage of any and all Losses of any kind or nature
whatsoever which to any extent (in whole or in part) may be imposed on, incurred
by, or asserted against Agent growing out of, resulting from or in any other way
associated with any of the Collateral, the Transaction Documents and the
transactions and events (including the enforcement thereof) at any time
associated therewith or contemplated therein. THE FOREGOING INDEMNIFICATION
SHALL APPLY WHETHER OR NOT SUCH LOSSES ARE IN ANY WAY OR TO ANY EXTENT OWED, IN
WHOLE OR IN PART, UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY, OR ARE CAUSED,
IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY AGENT,
PROVIDED ONLY THAT NO PARTICIPANT SHALL BE OBLIGATED UNDER THIS SECTION TO
INDEMNIFY AGENT FOR THAT PORTION, IF ANY, OF ANY LOSS WHICH IS PROXIMATELY
CAUSED BY AGENT'S OWN INDIVIDUAL GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, AS
DETERMINED IN A

                                     -18-
<PAGE>

FINAL JUDGMENT RENDERED AGAINST AGENT. Cumulative of the foregoing, each
Participant agrees to reimburse Agent promptly upon demand for such
Participant's Percentage share of any costs and expenses to be paid to Agent by
Extreme hereunder to the extent that Agent is not timely reimbursed by Extreme
as provided in subsection 7.2.8. As used in this Section the term "Agent" shall
refer not only to the Person designated as such in the introductory paragraph of
this Agreement, but also to each director, officer, agent, attorney, employee,
representative and Affiliate of such Person.

     Section 11.5 Agent's Rights as Participant and Deposit Taker. In its
                  -----------------------------------------------
capacity as a Participant, BNP PARIBAS shall have the same rights and
obligations as any Participant and may exercise such rights as though it were
not Agent. In its capacity as a Deposit Taker, BNP PARIBAS shall have the same
rights and obligations as any Deposit Taker and may exercise such rights as
though it were not Agent. BNP PARIBAS and any of its Affiliates may accept
deposits from, lend money to, act as Trustee under indentures of, and generally
engage in any kind of business with Extreme or its Affiliates, all as if BNP
PARIBAS were not designated as the Agent hereunder and without any duty to
account therefor to any other Participant.

     Section 11.6 Investments. Whenever Agent in good faith determines that it
                  -----------
is uncertain about how to distribute any funds which it has received hereunder,
or whenever Agent in good faith determines that there is any dispute among BNPLC
and Participants about how such funds should be distributed, Agent may choose to
defer distribution of the funds which are the subject of such uncertainty or
dispute. If Agent in good faith believes that the uncertainty or dispute will
not be promptly resolved, or if Agent is otherwise required to invest funds
pending distribution, Agent shall invest such funds pending distribution, all
interest on any such investment shall be distributed upon the distribution of
such investment and in the same proportion and to the same Persons as such
investment. All moneys received by Agent for distribution to BNPLC or
Participants shall be held by Agent pending such distribution solely as Agent
hereunder, and Agent shall have no equitable title to any portion thereof.

     Section 11.7 Benefit of Article XI. The provisions of this Article (other
                  ---------------------
than the following Section 11.8) are intended solely for the benefit of Agent,
BNPLC and Participants, and Extreme shall not be entitled to rely on any such
provision or assert any such provision in a claim or defense against Agent,
BNPLC or any Participant. Agent, BNPLC and Participants may waive or amend such
provisions as they desire without any notice to or consent of Extreme.

     Section 11.8 Resignation. Agent may resign at any time by giving written
                  -----------
notice thereof to BNPLC, Participants and Extreme. Upon any such resignation the
Majority (as defined in the Participation Agreement) shall have the right to
appoint a successor Agent, subject to Extreme's consent, such consent not to be
unreasonably withheld. A successor must be appointed for any retiring Agent, and
such Agent's resignation shall become effective when such successor accepts such
appointment. If, within thirty days after the date of the retiring Agent's
resignation, no successor Agent has been appointed and has accepted such
appointment, then the retiring Agent may appoint a successor Agent, which shall
be a commercial bank organized or licensed to conduct a banking or trust
business under the laws of the United States of America or of any state thereof.
Upon the acceptance of any appointment as Agent hereunder by a successor Agent,
the retiring Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Agent's resignation hereunder, the provisions
of this Article 10.1 shall continue to inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent.

                                     -19-
<PAGE>

                          ARTICLE XII   MISCELLANEOUS

     Section 12.1 Provisions Incorporated From Other Operative Documents.
                  ------------------------------------------------------
Reference is made to the Common Definitions and Provisions Agreement (Land), to
the Purchase Agreement and to the Participation Agreement for a statement of the
terms thereof. Without limiting the generality of the foregoing, the provisions
of Article II of the Common Definitions and Provisions Agreement (Land) are
incorporated into this Agreement for all purposes as if set forth in this
Article.

     Section 12.2 Cumulative Rights, etc. Except as herein expressly provided to
                  ----------------------
the contrary, the rights, powers and remedies of Agent, BNPLC and the
Participants under this Agreement shall be in addition to all rights, powers and
remedies given to them by virtue of any Applicable Law, any other Document or
any other agreement, all of which rights, powers, and remedies shall be
cumulative and may be exercised successively or concurrently without impairing
their respective rights hereunder. Extreme waives any right to require Agent,
BNPLC or any Participant to proceed against any Person or to exhaust any
Collateral or to pursue any remedy in Agent's, BNPLC's or such Participant's
power.

     Section 12.3 Survival of Agreements. All representations and warranties of
                  ----------------------
Extreme herein, and all covenants and agreements herein shall survive the
execution and delivery of this Agreement, the execution and delivery of any
other Transaction Documents and the creation of the Secured Obligations and
continue until terminated or released as provided herein.

     Section 12.4 Other Liable Party. Neither this Agreement nor the exercise by
                  ------------------
Agent or the failure of Agent to exercise any right, power or remedy conferred
herein or by law shall be construed as relieving any Other Liable Party from
liability on the Secured Obligations or any deficiency thereon. This Agreement
shall continue irrespective of the fact that the liability of any Other Liable
Party may have ceased or irrespective of the validity or enforceability of any
other agreement evidencing or securing the Secured Obligations to which Extreme
or any Other Liable Party may be a party, and notwithstanding the
reorganization, death, incapacity or bankruptcy of any Other Liable Party, or
any other event or proceeding affecting any Other Liable Party.

     Section 12.5 Termination. Following the Designated Sale Date, upon
                  -----------
satisfaction in full of all Secured Obligations and upon written request for the
termination hereof delivered by Extreme to Agent, (i) this Agreement and the
pledge and security interest created hereby shall terminate and all rights to
the Collateral shall revert to Extreme and (ii) Agent will, upon Extreme's
request and at Extreme's expense execute and deliver to Extreme such documents
as Extreme shall reasonably request to evidence such termination and release.

                         [The signature pages follow.]

                                     -20-
<PAGE>

     IN WITNESS WHEREOF, Extreme, BNPLC, Agent and the Participants whose
signatures appear below have caused this Agreement to be executed as of June 1,
2000.


                                                  "Extreme"

                                                  EXTREME NETWORKS, INC.


                                                  By:_________________________
                                                     Name:____________________
                                                     Title:___________________
<PAGE>

[Continuation of signature pages to Pledge Agreement (Land) dated to be
effective June 1, 2000]


                                           "BNPLC"

                                           BNP LEASING CORPORATION


                                           By: ____________________________
                                               Lloyd G. Cox, Vice President
<PAGE>

[Continuation of signature pages to Pledge Agreement (Land) dated to be
effective June 1, 2000]



                                            "AGENT"

                                            BNP PARIBAS


                                            By:_______________________
                                               Name:__________________
                                               Title:_________________






                                            "PARTICIPANT"

                                            BNP PARIBAS


                                            By:_______________________
                                               Name:__________________
                                               Title:_________________
<PAGE>

                                 ATTACHMENT 1
                              TO PLEDGE AGREEMENT
                              -------------------

                            CERTIFICATE OF DEPOSIT

                                (No. _________)


                              [---------, -----]


[NAME OF THE ISSUING
DEPOSIT TAKER AND THE
ADDRESS OF ITS APPLICABLE
ACCOUNT OFFICE]


Payable to
the order of:  BNP PARIBAS, as Agent under the Pledge Agreement (Land) dated
               June 1, 2000, among Extreme Networks, Inc., BNP Leasing
               Corporation, BNP PARIBAS and any other financial institutions
               which are from time to time Participants under such Pledge
               Agreement (Land) and BNP PARIBAS, acting in its capacity as agent
               for BNPLC and the Participants

                                                                        Dollars
-------------------------------------------------------------------------------
in current funds, without interest, seven days after presentment of this
certificate properly endorsed.

The bank issuing this certificate acknowledges and certifies that on the date
indicated above the payee deposited the dollar amount indicated above, and that
such amount shall be payable as provided above.


                                                       _________________________
                                                       Authorized Signature
<PAGE>

                                 ATTACHMENT 2
                              TO PLEDGE AGREEMENT
                              -------------------

                        SUPPLEMENT TO PLEDGE AGREEMENT
                        ------------------------------

                              [----------, ----]

BNP PARIBAS

_______________________
_______________________
_______________________


Extreme Networks, Inc.

_______________________
_______________________
_______________________


1.   Reference is made to the Pledge Agreement (Land) (the "Pledge Agreement")
dated June 1, 2000 among Extreme Networks, Inc. ("Extreme"), BNP Leasing
Corporation ("BNPLC"), BNP PARIBAS and any other financial institutions which
are from time to time Participants under such Pledge Agreement (collectively,
the "Participants") and BNP PARIBAS, acting in its capacity as agent for BNPLC
and the Participants (in such capacity, "Agent"). Unless otherwise defined
herein, all capitalized terms used in this Supplement have the respective
meanings given to those terms in the Pledge Agreement.

2.   The undersigned hereby certifies to Agent and Extreme that the undersigned
has become a party to the Participation Agreement by executing a supplement as
provided therein and that its Percentage thereunder is ______%.

3.   The undersigned, by executing and delivering this Supplement to Extreme and
Agent, hereby agrees to become a party to the Pledge Agreement and agrees to be
bound by all of the terms thereof applicable to Participants. The Deposit Taker
for the undersigned shall be _________________, until such time as another
Deposit Taker for the undersigned shall be designated in accordance with
Sections 4.4 or 4.5 of the Pledge Agreement. The undersigned certifies to Agent
and Extreme that such Deposit Taker is an Initially Qualified Deposit Taker and
satisfies the requirements for a Deposit Taker set forth in Section 4.1 of the
Pledge Agreement.

IN WITNESS WHEREOF, the undersigned has executed this Supplement as of the day
and year indicated above.

                                    [__________________________________________]



                                    By:_________________________________________
                                          Name:_________________________________
                                          Title:________________________________
<PAGE>

                                 ATTACHMENT 3
                              TO PLEDGE AGREEMENT
                              -------------------

       NOTICE OF EXTREME'S ELECTION TO CHANGE THE COLLATERAL PERCENTAGE
       ----------------------------------------------------------------

                              [---------, -----]



BNP PARIBAS
[address of BNP]


Re:  Pledge Agreement (Land) (the "Pledge Agreement") dated June 1, 2000 among
--
            Extreme Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any
            other financial institutions which are from time to time
            Participants under such Pledge Agreement and BNP PARIBAS, acting in
            its capacity as agent for BNPLC and the Participants

Gentlemen:

Capitalized terms used in this letter are intended to have the meanings assigned
to them in the Pledge Agreement referenced above. This letter constitutes notice
to you, as Agent under the Pledge Agreement, that pursuant to Section 3.1 of the
Pledge Agreement, Extreme elects to change the Collateral Percentage to:


                                             __________ percent (___%),

on the following Base Rent Date (which will be the first day of a new Base Rent
Period):

                                                  ----------, ----

Extreme expects that multiplying the new Collateral Percentage specified above
against Stipulated Loss Value of:

              ____________________________ Dollars ($__________),

will result in an expected new Minimum Collateral Value of:

              ____________________________ Dollars ($__________).


[NOTE: THE NEXT PARAGRAPH WILL BE INCLUDED ONLY IN A NOTICE OF AN INCREASE IN
THE COLLATERAL PERCENTAGE, BECAUSE OF WHICH EXTREME WILL BE REQUIRED TO DELIVER
ADDITIONAL CASH COLLATERAL TO SATISFY THE MINIMUM COLLATERAL VALUE REQUIREMENTS
IN SECTION 5.1 OF THE PLEDGE AGREEMENT:


Because of the increase in the Collateral Percentage which will result from
this notice and the corresponding increase in the Minimum Collateral Value,
Extreme will deliver additional Cash Collateral to you as required by Section
5.1 of the Pledge Agreement no later than 12:00 noon (San Francisco time) on the
Base Rent Date specified above, in the amount of:
<PAGE>

             ____________________________ Dollars ($__________).]

To assure you that Extreme has satisfied the conditions to its right to change
the Collateral Percentage as provided in this notice, and to induce you to rely
upon this notice in discharging your responsibilities under the Pledge
Agreement, Extreme certifies to you that:

     1.   Extreme is giving this notice to you, BNPLC and the Participants at
least ten Business Days prior to the Base Rent Date specified above, and such
Base Rent Date is the commencement of a Base Rent Period.

     2.   No Event of Default or other event or circumstance that would,
 pursuant to Section 3.2 of the Pledge Agreement, preclude Extreme from
 designating the new Collateral Percentage above has occurred and is continuing,
 and Extreme does not anticipate that on the Base Rent Date specified above
 there will have occurred and be continuing any such Event of Default or other
 event or circumstance.

     3.   The new Collateral Percentage specified by Extreme above is not less
than the Minimum Collateral Percentage currently in effect.

NOTE: YOU SHALL BE ENTITLED TO DISREGARD THIS NOTICE IF THE STATEMENTS ABOVE ARE
-----
NOT CORRECT. HOWEVER, WE ASK THAT YOU NOTIFY EXTREME IMMEDIATELY IF FOR ANY
REASON YOU BELIEVE THIS NOTICE IS DEFECTIVE.


                                       EXTREME NETWORKS, INC.

                                       By:____________________________________
                                            Name:_____________________________
                                            Title:____________________________
[cc BNPLC and all Participants]


                                      -2-
<PAGE>

                                 ATTACHMENT 4
                              TO PLEDGE AGREEMENT
                              -------------------

                          NOTICE OF SECURITY INTEREST
                          ---------------------------

                              [---------, -----]


[Name of Deposit Taker]
[Address of Deposit Taker]



1.   Reference is made to the Pledge Agreement (Land) (the "Pledge Agreement")
dated June 1, 2000 among Extreme Networks, Inc. ("Extreme"), BNP Leasing
Corporation ("BNPLC"), BNP PARIBAS and any other financial institutions which
are from time to time Participants under such Pledge Agreement (collectively,
the "Participants") and BNP PARIBAS, acting in its capacity as agent for BNPLC
and the Participants (in such capacity, "Agent"). Unless otherwise defined
herein, all capitalized terms used in this Notice have the respective meanings
given to those terms in the Pledge Agreement.

2.   Extreme has informed Agent that Extreme has established with the addressee
of this Notice (the "Deposit Taker") the following non-interest bearing
Account(s) to be maintained at the following Account Office(s):

   Account           Account         Account
    Type             Office          Number
------------         -------         -------
Time Deposit         _______         _______
Time Deposit         _______         _______
Time Deposit         _______         _______


Extreme has further informed Agent that Extreme intends to maintain Cash
Collateral in such Account(s), and that to evidence such Account(s) and the
amount of Cash Collateral held therein from time to time, Extreme has authorized
the Deposit Taker to issue Certificates of Deposit payable to the order of Agent
as provided in the Pledge Agreement.

     3.   Extreme and Agent hereby notify Deposit Taker that, pursuant to the
Pledge Agreement, Extreme has granted to Agent, for the ratable benefit of BNPLC
and the Participants as security for the Secured Obligations, a pledge of and
security interest in all Accounts and other Collateral maintained by Extreme
with Deposit Taker, including the Account(s) described in Section 2 above.

     4.   In furtherance of such grant, Extreme and Agent hereby authorize and
direct Deposit Taker to:

          (a)  hold all Collateral for Agent and as Agent's bailee,
     separate and apart from all other property and funds of Extreme and all
     other Persons and to permit no other funds to be deposited or credited
     to the Account(s);
<PAGE>

          (b)  make a notation in its books and records of the interest of Agent
     in the Collateral and that the Account(s) and all deposits therein or sums
     credited thereto are subject to a pledge and security interest in favor of
     Agent;

          (c)  issue and redeem Certificates of Deposit evidencing the
     Account(s), as directed by Agent pursuant to the Pledge Agreement;

          (d)  take such other steps as Agent may reasonably request to record,
     maintain, validate and perfect its pledge of and security interest in the
     Collateral; and

          (e)  upon receipt of notice from Agent that an Event of Default has
     occurred, transfer and deliver to Agent or its nominee, together with all
     necessary endorsements, all or such portion of the Collateral held by
     Deposit Taker as Agent shall direct; provided, however, that in connection
     therewith the Deposit Taker may require compliance by Agent with the
     provisions in Section 5.4 of the Pledge Agreement for redemption of any
     outstanding Certificates of Deposit which evidence the Account(s).

     5.   Extreme and Agent agree that (a) the possession by Deposit Taker of
all money, instruments, chattel paper and other property constituting Collateral
shall be deemed to be possession by Agent or a person designated by Agent, for
purposes of perfecting the security interest granted to Agent hereunder pursuant
to Section 9305, 8313 or 8213 of the UCC (as the case may be), and (b)
   --------------------------
notifications by Deposit Taker to other Persons holding any such property, and
Acknowledgments, receipts or confirmations from such Persons delivered to
Deposit Taker, shall be deemed notifications to, or Acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Deposit Taker for the benefit of Agent for the purposes of perfecting
such security interests under applicable law.

     6.   As contemplated by the Pledge Agreement, please acknowledge Deposit
Taker's receipt of, and consent to, this notice and confirm the representations
and agreements set forth in the Acknowledgment and Agreement attached hereto by
executing the same and returning this letter to Agent. For your files, a copy of
this letter is enclosed which you may retain. The authorizations and directions
set forth herein may not be revoked or modified without the written consent of
Agent.

                                       "AGENT"

                                       BNP PARIBAS


                                       By:  _________________________________
                                            Name:____________________________
                                            Title:___________________________

                                       "EXTREME"

                                       EXTREME NETWORKS, INC.


                                       By: ___________________________________
                                           Name:______________________________
                                           Title:_____________________________

                                      -2-
<PAGE>

                         ACKNOWLEDGMENT AND AGREEMENT
                               OF DEPOSIT TAKER


     Deposit Taker hereby acknowledges receipt of, and consents to, the
above notice, acknowledges that it will hold the Collateral for Agent and as
Agent's bailee, agrees to comply with the authorizations and directions set
forth above and represents to and agrees with Extreme and Agent as follows:

          (a)  Deposit Taker is a commercial bank, organized under the
     laws of the United States of America or a state thereof or under the laws
     of another country which is doing business in the United States of America.
     Deposit Taker is authorized to maintain deposit accounts for others through
     the Account Offices specified in the above notice, and Deposit Taker will
     not move the accounts described in the above notice to other offices
     without the prior written authorization of Agent and Extreme.

          (b)  Deposit Taker has a combined capital, surplus and undivided
     profits of at least $500,000,000.

          (c)  The information set forth above regarding the Account(s) is
     accurate. Such Account(s) is (are) currently open and Deposit Taker has no
     prior notice of any other pledge, security interest, Lien, adverse claim or
     interest in such Account(s).

          (d)  Deposit Taker shall promptly notify Extreme and Agent if
     the representations made by Deposit Taker above cease to be true and
     correct.

          (e)  Deposit Taker shall not (i) allow the withdrawal of funds from
     any Account by any Person other than Agent, or (ii) without in each case
                                                         --------------------
     first obtaining the prior written authorization of Agent, setoff or attempt
     --------------------------------------------------------
     to setoff any Secured Obligations owed to Deposit Taker against any
     Collateral held from time to time by Deposit Taker, or (iii) without in
                                                                  ----------
     each case first obtaining the prior written authorization of both Extreme
     -------------------------------------------------------------------------
     and Agent, setoff or attempt to setoff any obligations owed to Deposit
     ---------
     Taker other than Secured Obligations, against any Collateral held from time
     to time by Deposit Taker.

                                            [__________________________________]


                                            By:_________________________________
                                                  Name:_________________________
                                                  Title:________________________

                                            [Date]
<PAGE>

                                 ATTACHMENT 5
                              TO PLEDGE AGREEMENT
                              -------------------

                       EXAMPLES OF CALCULATIONS REQUIRED
                       ---------------------------------
                        TO AVOID A COLLATERAL IMBALANCE
                        -------------------------------

     The examples below are provided to illustrate the calculations required
for allocations of Cash Collateral in a manner that will avoid a Collateral
Imbalance. The examples are not intended to reflect actual numbers under this
Agreement or actual Percentages of BNPLC or any of the Participants; nor are the
examples intended to provide a formula for the allocations that would be
appropriate in every case. The examples also reflect adjustments that would be
appropriate if the Collateral Percentage were adjusted from time to time from
and after the Effective Date.

                                 EXAMPLE NO. 1

Assumptions:
-----------

1.   Two Participants ("Participant A" and "Participant B") are parties to the
     Participation Agreement with BNPLC. Participant A's Percentage is 50% and
     Participant B's Percentage is 45%, leaving BNPLC with a Percentage of 5%.

2.   On the Effective Date, the Initial Funding Advance was $12,000,000,
     resulting in a Stipulated Loss Value of $12,000,000, allocable as follows:

<TABLE>
     <S>                                                                                       <C>
     A.   BNPLC's Parent (providing BNPLC's share) (5%)......................................  $  600,000
     B.   Participant A (50%)................................................................   6,000,000
     C.   Participant B (45%)................................................................   5,400,000
                                                                                               ----------
          TOTAL..............................................................................  $12,000,00
</TABLE>

3.   The Minimum Collateral Value on the Effective Date was $7,200,000
     (reflecting a Collateral Percentage of 60% times Stipulated Loss Value).

4.   On the Effective Date, Extreme had delivered to Agent Cash Collateral of
     $7,200,000, equal to the Minimum Collateral Value, as required by Section
     5.1 of this Agreement.

Allocation of Cash Collateral Required: To avoid a Collateral Imbalance under
--------------------------------------
these assumptions, Agent would be required to allocate the $7,200,000 to the
Deposit Takers for BNPLC and the Participants as follows:

<TABLE>
     <S>                                                                                       <C>
     A.   BNPLC's Deposit Taker (5% of Minimum Collateral Value).............................  $    360,000
     B.   Participant A's Deposit Taker (50% of Minimum Collateral Value)....................     3,600,000
     C.   Participant B's  Deposit Taker (45% of Minimum Collateral Value)...................     3,240,000
                                                                                               ------------
          TOTAL..............................................................................  $  7,200,000
</TABLE>

                                 EXAMPLE NO. 2

Assumptions:  Assume the same facts as in Example No. 1, and in addition assume
-----------
that:

1.   Effective as of the first Base Rent Date, Extreme increased its Collateral
     Percentage from 60% to
<PAGE>

     80%, raising the Minimum Collateral Value to $9,600,000. Because of such
     increase, Extreme also delivered an additional $2,400,000 as Cash
     Collateral to Agent on the first Base Rent Date, bringing the total of all
     Cash Collateral delivered by Extreme to $9,600,000 as required by Section
     5.1 of this Agreement.

2.   Also effective as of the first Base Rent Date, a new Participant approved
     by Extreme ("Participant C") became a party to this Agreement and the
     Participation Agreement, taking a Percentage of 20%. Simultaneously,
     Participant A and Participant B entered into supplements to the
     Participation Agreement which reduced their Percentages to 40% and 35%,
     respectively.

Allocation of Cash Collateral Required: To avoid a Collateral Imbalance under
--------------------------------------
these assumptions, Agent would be required to allocate the Cash Collateral as
required to leave the Deposit Takers for BNPLC and the Participants with the
following amounts:

<TABLE>
     <S>                                                                                           <C>
     A.   BNPLC's Deposit Taker (5% of Minimum Collateral Value).................................  $  480,000
     B.   Participant A's Deposit Taker (40% of Minimum Collateral Value)........................   3,840,000
     C.   Participant B's Deposit Taker (35% of Minimum Collateral Value)........................   3,360,000
     D.   Participant C's  Deposit Taker (20% of Minimum Collateral Value).......................   1,920,000
                                                                                                   ----------

          TOTAL..................................................................................  $9,600,000
</TABLE>

Thus, to prevent a Collateral Imbalance, Agent would have to allocate the
$2,400,000 of additional Cash Collateral it received on the first Base Rent Date
as follows:

<TABLE>
     <S>                                                                                          <C>
     A.   BNPLC's Deposit Taker ($480,000 less $360,000 already on deposit) ....................  $  120,000
     B.   Participant A's Deposit Taker ($3,840,000 less $3,600,000 already on deposit).........     240,000
     C.   Participant B's Deposit Taker ($3,360,000 less $3,240,000 already on deposit).........     120,000
     D.   Participant C's  Deposit Taker ($1,920,000 less $0 already on deposit)................  $1,920,000
                                                                                                  ----------

          TOTAL.................................................................................  $2,400,000
</TABLE>

                                 EXAMPLE NO. 3

Assumptions:  Assume the same facts as in Example No. 2, except that:
-----------                                              -----------

1.   Instead of increasing its Collateral Percentage from 60% to 80%, Extreme
     increased its Collateral Percentage to 70% on the first Base Rent Date,
     raising the Minimum Collateral Value to $8,400,000. Because of such
     increase, Extreme delivered an additional $1,200,000 as additional Cash
     Collateral to Agent on the first Base Rent Date, bringing the total of all
     Cash Collateral delivered by Extreme to $8,400,000 as required by Section
     5.1 of this Agreement.

Allocation of Cash Collateral Required: To avoid a Collateral Imbalance under
--------------------------------------
these assumptions, Agent would be required to allocate the Cash Collateral as
required to leave the Deposit Takers for BNPLC and the Participants with the
following amounts:

<TABLE>
     <S>                                                                                         <C>
     A.   BNPLC's Deposit Taker (5% of Minimum Collateral Value)..............................   $  420,000
     B.   Participant A's Deposit Taker (40% of Minimum Collateral Value).....................    3,360,000
     C.   Participant B's Deposit Taker (35% of Minimum Collateral Value).....................    2,940,000
     D.   Participant C's  Deposit Taker (20% of Minimum Collateral Value)....................    1,680,000
                                                                                                 ----------
          TOTAL...............................................................................   $8,400,000
</TABLE>

                                      -2-
<PAGE>

Thus, to prevent a Collateral Imbalance, Agent would have to allocate the
$1,200,000 of additional Cash Collateral it received on the first Base Rent Date
as follows:

<TABLE>
     <S>                                                                                             <C>
     A.   BNPLC's Deposit Taker ($420,000 less $360,000 already on deposit) ........................ $   60,000
     B.   Participant A's Deposit Taker ($3,360,000 less $3,600,000 already on deposit).............   (240,000)
     C.   Participant B's Deposit Taker ($2,940,000 less $3,240,000 already on deposit).............   (300,000)
     D.   Participant C's  Deposit Taker ($1,680,000 less $0 already on deposit)....................  1,680,000
                                                                                                     ----------

          TOTAL..................................................................................... $1,200,000
</TABLE>

NOTE: THE NEGATIVE AMOUNTS (IN PARENTHESIS) ABOVE REPRESENT REQUIRED WITHDRAWALS
----                                                                 -----------
RATHER THAN DEPOSITS. AS EXAMPLE NO. 3 ILLUSTRATES, TO AVOID A COLLATERAL
IMBALANCE AGENT MAY FROM TIME TO TIME HAVE TO WITHDRAW CASH COLLATERAL HELD BY
THE DEPOSIT TAKER FOR ONE PARTICIPANT AND DEPOSIT IT IN AN ACCOUNT MAINTAINED BY
A DEPOSIT TAKER FOR ANOTHER PARTICIPANT.

                                      -3-
<PAGE>

                                 ATTACHMENT 6
                              TO PLEDGE AGREEMENT
                              -------------------

                      NOTICE OF EXTREME'S REQUIREMENT TO
                      ----------------------------------
                        WITHDRAW EXCESS CASH COLLATERAL
                        -------------------------------



                            [_________, _____]


BNP PARIBAS
[address of BNP]


     Re:     Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
             Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
             institutions which are from time to time Participants under such
             Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
             agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice to you, as Agent under the Pledge
Agreement, that pursuant to Section 6.1 of the Pledge Agreement, Extreme
requires you to withdraw from the Accounts and return to Extreme the following
amount:

                        __________________ Dollars ($__________)

on the following date:

                               ----------, ----


     To assure you that Extreme has satisfied the conditions to its right to
require such withdrawal, and to induce you to comply with this notice, Extreme
certifies to you that:

          1.   Your withdrawal and delivery of the amount specified above to
     Extreme will not cause the Value of the remaining Collateral to be less
     than the Minimum Collateral Value. After giving effect to such withdrawal,
     the Collateral remaining in the Accounts maintained by the Deposit Takers
     will be:

                        __________________ Dollars ($__________),
<PAGE>

     and the Minimum Collateral Value on the date specified above will equal:


                        __________________ Dollars ($__________).


     Such Minimum Collateral Value equals the Collateral Percentage of:


                          __________ percent (___%),


     times the Stipulated Loss Value of:


                        __________________ Dollars ($__________).


          2.   Extreme is giving this notice to you, BNPLC and the Participants
     at least ten days prior to the date specified above.

          3.   No Default or Event of Default has occurred and is continuing as
     of the date of this notice, and Extreme does not anticipate that any
     Default or Event of Default will have occurred and be continuing on the
     date upon which the withdrawal is required.

          4.   Extreme agrees that you may determine the Accounts from which to
     make any withdrawal required by Extreme pursuant to this Section as
     necessary to prevent or mitigate any Collateral Imbalance.

     NOTE: YOU SHALL BE ENTITLED TO DISREGARD THIS NOTICE IF THE STATEMENTS
     ----
     ABOVE ARE NOT CORRECT OR IF THE DATE FOR WITHDRAWAL SPECIFIED ABOVE IS LESS
     THAN TEN DAYS AFTER YOUR RECEIPT OF THIS NOTICE. HOWEVER, WE ASK THAT YOU
     NOTIFY EXTREME IMMEDIATELY IF FOR ANY REASON YOU BELIEVE THIS NOTICE IS
     DEFECTIVE.

                                      -2-
<PAGE>

     Please remember that the express terms of Certificates of Deposit issued
pursuant to the Pledge Agreement require presentment of the Certificates of
Deposit seven days before Cash Collateral is to be withdrawn from the Accounts
they evidence. Accordingly, you must present Certificates of Deposit to Deposit
Takers seven days prior to the withdrawal of Cash Collateral required by this
notice. For your convenience, we have attached a letter as Annex 1 to this
                                                           -------
notice that you might execute and send to Deposit Takers to advise them of your
intent to withdraw and of your presentment of Certificates of Deposit as
required in connection therewith. The attached letter also sets forth the
amounts Extreme believes you must withdraw from each Account to avoid a
Collateral Imbalance.

                                              EXTREME NETWORKS, INC.

                                              By: ______________________________
                                                    Name:_______________________
                                                    Title:______________________

[cc BNPLC and all Participants]

                                      -3-
<PAGE>

                                    Annex 1
                                    -------
                     TO EXTREME'S NOTICE OF REQUIREMENT TO
                     -------------------------------------
                        WITHDRAW CASH EXCESS COLLATERAL
                        -------------------------------

                              [_________, _____]

Deposit Takers on the
Attached Distribution List

     Re:    Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
            Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
            institutions which are from time to time Participants under such
            Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
            agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice from the undersigned, as Agent under
the Pledge Agreement, that pursuant to Section 6.1 of the Pledge Agreement,
Extreme requires Agent to withdraw from the Accounts and return to Extreme the
amounts listed below on the following date:

                               __________, ____


     Accordingly, on such date, the undersigned intends to withdraw the
following amounts from the following Accounts, and with this letter the
undersigned is presenting Certificates of Deposit as required in connection with
such withdrawal:

 Deposit Taker                        Account No.          Amount


1.________________               ___________________           $________

2.________________               ___________________           $________

3.________________               ___________________           $________

4.________________               ___________________           $________

                                  TOTAL WITHDRAWALS:           $========

                                      BNP PARIBAS, AS AGENT

                                      By:   ____________________________________
                                            Name:_______________________________
                                            Title:______________________________

[cc BNPLC and Extreme]

                                      -4-
<PAGE>

                                 ATTACHMENT 7
                              TO PLEDGE AGREEMENT
                              -------------------

                      NOTICE OF EXTREME'S REQUIREMENT OF
                      ----------------------------------
                        DIRECT PAYMENTS TO PARTICIPANTS
                        -------------------------------


                              [_________, _____]




BNP PARIBAS
[address of BNP]


     Re:     Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
             Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
             institutions which are from time to time Participants under such
             Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
             agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice to you, as Agent under the Pledge
Agreement, that pursuant to Section 6.2 of the Pledge Agreement, Extreme
requires you to withdraw from the Accounts and pay directly to the Participants
(in proportion to their respective Percentages) the following amount:

              ____________________________ Dollars ($__________)

on the following date (which, Extreme acknowledges, must be the Designated Sale
Date or a date thereafter prior to an Event of Default):

                               __________, ____


         The amount specified above equals the following percentage (equal to
the aggregate of all Participant's Percentages):

                          ___________percent (___%),


times the total of all Cash Collateral presently pledged under the Pledge
Agreement:


              ____________________________ Dollars ($__________).
<PAGE>

     To assure you that Extreme has satisfied the conditions to its right to
require such withdrawal, and to induce you to comply with this notice, Extreme
certifies to you that Extreme is giving this notice to you, BNPLC and the
Participants at least ten days prior to the date of required withdrawal and
payment specified above.

     Please remember that the express terms of Certificates of Deposit issued
pursuant to the Pledge Agreement require presentment of the Certificates of
Deposit seven days before Cash Collateral is to be withdrawn from the Accounts
they evidence. Accordingly, you must present Certificates of Deposit to Deposit
Takers seven days prior to the withdrawal of Cash Collateral required by this
notice. For your convenience, we have attached a letter as Annex 1 to this
                                                           -------
notice that you might execute and send to Deposit Takers to advise them of your
intent to withdraw and of your presentment of Certificates of Deposit as
required in connection therewith. The attached letter also sets forth the
amounts Extreme believes you must withdraw from each Account to comply with
subsection 6.2.2 of the Pledge Agreement.

                                       EXTREME NETWORKS, INC.

                                       By:______________________________________
                                            Name:_______________________________
                                            Title:______________________________
[cc BNPLC and all Participants]

                                      -2-
<PAGE>

                                    Annex 1
                                    -------
                     TO EXTREME'S NOTICE OF REQUIREMENT TO
                     -------------------------------------
                         WITHDRAW CASH COLLATERAL FOR
                         ----------------------------
                        DIRECT PAYMENTS TO PARTICIPANTS
                        -------------------------------
                              [_________, _____]


Deposit Takers on the
Attached Distribution List

     Re:     Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
             Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
             institutions which are from time to time Participants under such
             Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
             agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice from the undersigned, as Agent under
the Pledge Agreement, that pursuant to Section 6.2 of the Pledge Agreement,
Extreme requires Agent to withdraw from the Accounts and pay to the Participants
(in proportion to their respective Percentages) the amounts listed below on the
following date:

                               __________, ____

     Accordingly, on such date, the undersigned intends to withdraw the
following amounts from the following Accounts, and with this letter the
undersigned is presenting Certificates of Deposit as required in connection with
such withdrawal:

Deposit Taker                Account No.              Amount

1._________________       __________________             $__________

2._________________       __________________             $__________

3._________________       __________________             $__________

4._________________       __________________             $__________

                          TOTAL WITHDRAWALS:             $==========

                                         BNP PARIBAS, AS AGENT

                                         By:  __________________________________
                                              Name:_____________________________
                                              Title:____________________________
[cc BNPLC and Extreme]

                                      -3-
<PAGE>

                                 ATTACHMENT 8
                              TO PLEDGE AGREEMENT
                              -------------------

                      NOTICE OF EXTREME'S REQUIREMENT OF
                      ----------------------------------
                            DIRECT PAYMENT TO BNPLC
                            -----------------------
                              [_________, _____]

BNP PARIBAS
[address of BNP]

     Re:   Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
           Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
           institutions which are from time to time Participants under such
           Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
           agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice to you, as Agent under the Pledge
Agreement, that pursuant to Section 6.3 of the Pledge Agreement, Extreme
requires you to withdraw from the Account maintained by the Deposit Taker for
BNPLC and pay directly to BNPLC on behalf of Extreme as a payment required by
the Purchase Agreement the following amount:

              ____________________________ Dollars ($__________)

on the following date (which, Extreme acknowledges, must be the Designated Sale
Date or a date thereafter prior to an Event of Default):

                               __________, ____

     To assure you that Extreme has satisfied the conditions to its right to
require such withdrawal, and to induce you to comply with this notice, Extreme
certifies to you that Extreme is giving this notice to you and BNPLC at least
ten days prior to the date of required withdrawal and payment specified above.

     Please remember that the express terms of Certificates of Deposit
issued pursuant to the Pledge Agreement require presentment of the Certificates
of Deposit seven days before Cash Collateral is to be withdrawn from the
Accounts they evidence. Accordingly, you must present Certificates of Deposit to
the Deposit Taker for BNPLC seven days prior to the withdrawal of Cash
Collateral required by this notice. For your convenience, we have attached a
letter as Annex 1 to this notice that you might execute and send to the Deposit
          -------
Taker for BNPLC to advise it of your intent to withdraw and of your presentment
of Certificates of Deposit as required in connection therewith. The attached
letter also sets forth the amount Extreme believes you must withdraw to comply
with Section 6.3 of the Pledge Agreement.

                                             EXTREME NETWORKS, INC.

                                             By:________________________________
                                                   Name:________________________
                                                   Title:_______________________
[cc BNPLC]
<PAGE>

                                    Annex 1
                                    -------
                     TO EXTREME'S NOTICE OF REQUIREMENT OF
                     -------------------------------------
                            DIRECT PAYMENT TO BNPLC
                            -----------------------


                              [_________, _____]


[Name of the Deposit Taker for BNPLC]
[Address of such Deposit Taker]

     Re:      Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
              Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
              institutions which are from time to time Participants under such
              Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
              agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice from the undersigned, as Agent under
the Pledge Agreement, that pursuant to Section 6.3 of the Pledge Agreement,
Extreme requires Agent to withdraw from the Account maintained by you, as
Deposit Taker for BNPLC, the sum of:

              ____________________________ Dollars ($__________)


and pay the same to BNPLC as a payment required by the Purchase Agreement on the
following date:

                               __________, ____


         Accordingly, on such date, the undersigned intends to withdraw such
amount from the following Account maintained by you as Deposit Taker for BNPLC,
and with this letter the undersigned is presenting Certificate(s) of Deposit as
required in connection with such withdrawal.

                                         BNP PARIBAS, AS AGENT

                                         By:  __________________________________
                                              Name:_____________________________
                                              Title:____________________________

[cc BNPLC and Extreme]

                                      -2-
<PAGE>

                                 ATTACHMENT 9
                              TO PLEDGE AGREEMENT
                              -------------------

                NOTICE OF EXTREME'S REQUIREMENT OF A WITHDRAWAL
                -----------------------------------------------
                            OF CASH COLLATERAL FROM
                            -----------------------
                         A DISQUALIFIED DEPOSIT TAKER
                         ----------------------------


                              [_________, _____]


BNP PARIBAS
[address of BNP]


     Re:      Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
              Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
              institutions which are from time to time Participants under such
              Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
              agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice to you, as Agent under the Pledge
Agreement, that pursuant to Section 6.4 of the Pledge Agreement, Extreme
requires you to withdraw from the following Account maintained by the following
Deposit Taker:

                    Deposit Taker                  Account No.
                    -----------------------    -------------------

Cash Collateral in the following amount:

                    ______________________ Dollars ($__________)


and to deposit such Cash Collateral with other Deposit Takers who are not
Disqualified Deposit Takers no later than ten days after the date upon which you
receive this notice.

     To assure you that Extreme has the right to require such withdrawal, and to
induce you to comply with this notice, Extreme certifies to you that the Deposit
Taker specified above has become a Disqualified Deposit Taker because it no
longer satisfies the requirements listed in Section 4.1 of the Pledge Agreement.
Specifically, such Deposit Taker no longer satisfies the following requirements:

[EXTREME MUST INSERT HERE A DESCRIPTION OF WHICH REQUIREMENTS THE DEPOSIT TAKER
NO LONGER SATISFIES AND HOW EXTREME HAS DETERMINED THAT THE REQUIREMENTS ARE NO
LONGER SATISFIED, ALL IN SUFFICIENT DETAIL TO PERMIT THE PARTICIPANT FOR WHOM
SUCH DEPOSIT TAKER HAS BEEN MAINTAINING AN ACCOUNT TO RESPOND IF IT BELIEVES
THAT EXTREME IS IN
<PAGE>

ERROR.]

     Please remember that the express terms of Certificates of Deposit issued
pursuant to the Pledge Agreement require presentment of the Certificates of
Deposit seven days before Cash Collateral is to be withdrawn from the Accounts
they evidence. Accordingly, you must present Certificates of Deposit to the
Deposit Taker specified above seven days prior to the withdrawal of Cash
Collateral required by this notice. For your convenience, we have attached a
letter as Annex 1 to this notice that you might execute and send to such Deposit
          -------
Taker to advise it of your intent to withdraw and of your presentment of
Certificates of Deposit as required in connection therewith. The attached letter
also sets forth the amount Extreme believes you must withdraw to comply with
Section 6.4 of the Pledge Agreement.

                                            EXTREME NETWORKS, INC.

                                            By:_________________________________
                                                 Name:__________________________
                                                 Title:_________________________
[cc BNPLC]

                                      -2-
<PAGE>

                                    Annex 1
                                    -------
              TO EXTREME'S NOTICE OF REQUIREMENT OF A WITHDRAWAL
              --------------------------------------------------
                            OF CASH COLLATERAL FROM
                            -----------------------
                         A DISQUALIFIED DEPOSIT TAKER
                         ----------------------------


                              [_________, _____]


[Name of the Deposit Taker for BNPLC]
[Address of such Deposit Taker]

     Re:   Pledge Agreement (Land) dated June 1, 2000 among Extreme Networks,
     --
           Inc., BNP Leasing Corporation, BNP PARIBAS and any other financial
           institutions which are from time to time Participants under such
           Pledge Agreement (Land) and BNP PARIBAS, acting in its capacity as
           agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Land) referenced above (the "Pledge
Agreement"). This letter constitutes notice from the undersigned, as Agent under
the Pledge Agreement, that pursuant to Section 6.4 of the Pledge Agreement,
Extreme has advised Agent that you are a Disqualified Deposit Taker, and Extreme
requires Agent to withdraw from the Account maintained by you, as a Deposit
Taker under the Pledge Agreement, the sum of:

              ____________________________ Dollars ($__________)


no later than the following date:

                               __________, ____


     Accordingly, on such date, the undersigned intends to withdraw such amount
from the Account maintained by you as Deposit Taker (Account No. __________),
and with this letter the undersigned is presenting Certificate(s) of Deposit as
required in connection with such withdrawal.

                                           BNP PARIBAS, AS AGENT

                                           By:   _______________________________
                                                 Name:__________________________
                                                 Title:_________________________

[cc BNPLC and Extreme]

                                      -3-
<PAGE>

                                  Schedule 1
                              TO PLEDGE AGREEMENT
                              -------------------

     [IN PLACE OF THIS PAGE, SUBSTITUTE SCHEDULE 1 ATTACHED TO THE LEASE]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.13
<SEQUENCE>9
<FILENAME>0009.txt
<DESCRIPTION>FORM OF PLEDGE AGREEMENT (IMPROVEMENTS) JUNE 1, 2000
<TEXT>

<PAGE>

================================================================================

                                                                   EXHIBIT 10.13

                               PLEDGE AGREEMENT

                                (IMPROVEMENTS)

                                     AMONG

                            BNP LEASING CORPORATION

                                   ("BNPLC")

                             BNP PARIBAS, AS AGENT

                                   ("Agent")


                            EXTREME NETWORKS, INC.

                                  ("Extreme")


                                      AND

                       PARTICIPANTS AS DESCRIBED HEREIN

                                 June 1, 2000

================================================================================
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                Page
<S>                                                                                                             <C>
ARTICLE I   DEFINITIONS AND INTERPRETATION.......................................................................-1-
         Section 1.1  Capitalized Terms Used But Not Defined in This Agreement...................................-1-
                      --------------------------------------------------------
         Section 1.2  Definitions................................................................................-1-
                      -----------
                  Account........................................................................................-1-
                  Account Office.................................................................................-2-
                  Agent..........................................................................................-2-
                  BNPLC..........................................................................................-2-
                  BNPLC's Corresponding Obligations to Participants..............................................-2-
                  Cash Collateral................................................................................-2-
                  Certificate of Deposit.........................................................................-2-
                  Collateral.....................................................................................-2-
                  Collateral Imbalance...........................................................................-2-
                  Collateral Percentage..........................................................................-2-
                  Default........................................................................................-3-
                  Deposit Taker..................................................................................-3-
                  Deposit Taker Losses...........................................................................-3-
                  Deposit Taker's Acknowledgment and Agreement...................................................-3-
                  Disqualified Deposit Taker.....................................................................-3-
                  Event of Default...............................................................................-3-
                  Extreme........................................................................................-4-
                  Extreme's Purchase Agreement Obligations.......................................................-4-
                  Initially Qualified Deposit Taker..............................................................-5-
                  Lien...........................................................................................-5-
                  Material Lease Default.........................................................................-5-
                  Minimum Collateral Percentage..................................................................-5-
                  Minimum Collateral Value.......................................................................-6-
                  Notice of Security Interest....................................................................-6-
                  Other Liable Party.............................................................................-6-
                  Participants...................................................................................-6-
                  Participation Agreement........................................................................-6-
                  Percentage.....................................................................................-6-
                  Qualified Pledge...............................................................................-6-
                  Secured Obligations............................................................................-6-
                  Supplement.....................................................................................-6-
                  Transaction Documents..........................................................................-6-
                  Value..........................................................................................-7-
         Section 1.3  Attachments................................................................................-7-
                      -----------
         Section 1.4  Amendment of Defined Instruments...........................................................-7-
                      --------------------------------
         Section 1.5  References and Titles......................................................................-7-
                      ---------------------

ARTICLE II   SECURITY INTEREST...................................................................................-7-
         Section 2.1  Pledge and Grant of Security Interest......................................................-7-
                      -------------------------------------
         Section 2.2  Return of Collateral After the Secured Obligations are Satisfied in Full...................-8-
                      ------------------------------------------------------------------------

ARTICLE III   DETERMINATION OF THE COLLATERAL PERCENTAGE.........................................................-8-
         Section 3.1  Determination of the Collateral Percentage Generally.......................................-8-
                      ----------------------------------------------------
</TABLE>
<PAGE>

<TABLE>
<S>                                                                                                             <C>
         Section 3.2  Limitations on Extreme's Right to Lower the Collateral Percentage......................... -8-
                      -----------------------------------------------------------------
         Section 3.3  Minimum Collateral Percentages Dependent Upon the Adjusted EBITDAR Coverage Ratio......... -9-
                      ---------------------------------------------------------------------------------

ARTICLE IV   PROVISIONS CONCERNING DEPOSIT TAKERS............................................................... -9-
         Section 4.1  Qualification of Deposit Takers Generally................................................. -9-
                      -----------------------------------------
         Section 4.2  Existing Deposit Takers................................................................... -9-
                      -----------------------
         Section 4.3  Replacement of Participants Proposed by Extreme...........................................-10-
                      -----------------------------------------------
         Section 4.4  Mandatory Substitution for Disqualified Deposit Takers....................................-10-
                      ------------------------------------------------------
         Section 4.5  Voluntary Substitution of Deposit Takers..................................................-10-
                      ----------------------------------------
         Section 4.6  Delivery of Notice of Security Interest by Extreme and Agent..............................-10-
                      ------------------------------------------------------------
         Section 4.7  Constructive Possession of Collateral.....................................................-11-
                      -------------------------------------
         Section 4.8  Attempted Setoff by Deposit Takers........................................................-11-
                      ----------------------------------
         Section 4.9  Deposit Taker Losses......................................................................-11-
                      --------------------
         Section 4.10  Losses Resulting from Failure of Deposit Taker to Comply with this Agreement.............-11-
                       ----------------------------------------------------------------------------

ARTICLE V   DELIVERY AND MAINTENANCE OF CASH COLLATERAL.........................................................-12-
         Section 5.1  Delivery of Funds by Extreme..............................................................-12-
                      ----------------------------
         Section 5.2  Transition Account........................................................................-12-
                      ------------------
         Section 5.3  Allocation of Cash Collateral Among Deposit Takers........................................-12-
                      --------------------------------------------------
         Section 5.4  Issuance and Redemption of Certificates of Deposit........................................-13-
                      --------------------------------------------------
         Section 5.5  Status of the Accounts Under the Reserve Requirement Regulations..........................-13-
                      ----------------------------------------------------------------
         Section 5.6  Acknowledgment by Extreme that Requirements of this Agreement are Commercially Reasonable.-13-
                      -----------------------------------------------------------------------------------------

ARTICLE VI   WITHDRAWAL OF CASH COLLATERAL......................................................................-14-
         Section 6.1  Withdrawal of Collateral Prior to the Designated Sale Date................................-14-
                      ----------------------------------------------------------
         Section 6.2  Withdrawal and Application of Cash Collateral to Reduce or Satisfy the Secured Obligations
                      ------------------------------------------------------------------------------------------
                      to the Participants.......................................................................-14-
                      ------------------
         Section 6.3  Withdrawal and Application of Cash Collateral to Reduce or Satisfy the Secured Obligations
                      ------------------------------------------------------------------------------------------
                      to BNPLC..................................................................................-15-
                      --------
         Section 6.4  Withdrawal of Cash Collateral From Accounts Maintained by Disqualified Deposit Takers.....-15-
                      -------------------------------------------------------------------------------------

ARTICLE VII   REPRESENTATIONS AND COVENANTS OF Extreme..........................................................-15-
         Section 7.1  Representations of Extreme................................................................-15-
                      --------------------------
         Section 7.2  Covenants of Extreme......................................................................-16-
                      --------------------

ARTICLE VIII    AUTHORIZED ACTION BY AGENT......................................................................-17-
         Section 8.1  Power of Attorney.........................................................................-17-
                      -----------------

ARTICLE IX    DEFAULT AND REMEDIES..............................................................................-18-
         Section 9.1  Remedies..................................................................................-18-
                      --------

ARTICLE X    OTHER RECOURSE.....................................................................................-18-
         Section 10.1  Recovery Not Limited.....................................................................-18-
                       --------------------

ARTICLE XI   PROVISIONS CONCERNING AGENT........................................................................-19-
         Section 11.1  Appointment and Authority................................................................-19-
                       -------------------------
         Section 11.2  Exculpation, Agent's Reliance, Etc.......................................................-19-
                       ----------------------------------
         Section 11.3  Participant's Credit Decisions...........................................................-20-
                       ------------------------------
         Section 11.4  Indemnity................................................................................-20-
                       ---------
         Section 11.5  Agent's Rights as Participant and Deposit Taker..........................................-20-
                       -----------------------------------------------
</TABLE>
<PAGE>

<TABLE>
<S>                                                                                                             <C>
         Section 11.6  Investments..............................................................................-20-
                       -----------
         Section 11.7  Benefit of Article XI....................................................................-21-
                       ---------------------
         Section 11.8  Resignation..............................................................................-21-
                       -----------

ARTICLE XII   MISCELLANEOUS.....................................................................................-21-
         Section 12.1 Provisions Incorporated From Other Operative Documents....................................-21-
                      ------------------------------------------------------
         Section 12.2  Cumulative Rights, etc...................................................................-21-
                       ----------------------
         Section 12.3  Survival of Agreements...................................................................-21-
                       ----------------------
         Section 12.4  Other Liable Party.......................................................................-21-
                       ------------------
         Section 12.5  Termination..............................................................................-22-
                       -----------
</TABLE>
<PAGE>

<TABLE>
<S>                                              <C>
Attachment 1.........................................................................Form of Certificate of Deposit

Attachment 2..........................................................Supplement to Pledge Agreement (Improvements)

Attachment 3.......................................Notice of Extreme's Election to Change the Collateral Percentage

Attachment 4............................................................................Notice of Security Interest

Attachment 5...............................................................................Examples of Calculations

Attachment 6.....................................Notice of Extreme's Requirement to Withdraw Excess Cash Collateral

Attachment 7.....................................Notice of Extreme's Requirement of Direct Payments to Participants

Attachment 8.....................................Notice of Extreme's Requirement of Direct Payments to Participants

Attachment 9........................................................Notice of Extreme's Requirement of a Withdrawal
                                                               of Cash Collateral from a Disqualified Deposit Taker

Schedule 1...............................................................Financial Covenants and Negative Covenants
----------
</TABLE>
<PAGE>

                               PLEDGE AGREEMENT

                                (IMPROVEMENTS)

     This PLEDGE AGREEMENT (IMPROVEMENTS) (this "Agreement") is made as of June
1, 2000 (the "Effective Date"), by EXTREME NETWORKS, INC., a California
corporation ("Extreme"); BNP LEASING CORPORATION, a Delaware corporation
("BNPLC"); BNP PARIBAS ("BNPLC's Parent"), as a "Participant"; and BNP PARIBAS,
acting in its capacity as agent for BNPLC and the Participants (in such
capacity, "Agent").

                                   RECITALS

     A.  Extreme and BNPLC are parties to: (i) a Common Definitions and
Provisions Agreement (Improvements) dated as of the Effective Date (the "Common
Definitions and Provisions Agreement (Improvements)"); and (ii) a Purchase
Agreement (Improvements) dated as of the Effective Date (the "Purchase
Agreement"), pursuant to which Extreme has agreed to make a "Supplemental
Payment" (as defined in the Common Definitions and Provisions Agreement
(Improvements)), in consideration of the rights granted to Extreme by the
Purchase Agreement.

     B.  Pursuant to a Participation Agreement dated the date hereof (the
"Participation Agreement"), BNPLC's Parent has agreed with BNPLC to participate
in the risks and rewards to BNPLC of the Purchase Agreement and other Operative
Documents (as defined in the Common Definitions and Provisions Agreement
(Improvements)), and the parties to this Agreement anticipate that other
financial institutions may become parties to the Participation Agreement as
Participants, agreeing to participate in the risks and rewards to BNPLC of the
Purchase Agreement and other Operative Documents.

     C.  Extreme may from time to time deliver cash collateral for its
obligations to BNPLC under the Purchase Agreement and for BNPLC's corresponding
obligations to Participants under the Participation Agreement. This Agreement
sets forth the terms and conditions governing such cash collateral.

                                   AGREEMENT
                                   ---------

     NOW, THEREFORE, in consideration of the above recitals and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

                  ARTICLE I   DEFINITIONS AND INTERPRETATION

     Section 1.1 Capitalized Terms Used But Not Defined in This Agreement.
                 --------------------------------------------------------
All capitalized terms used in this Agreement which are defined in Article I of
the Common Definitions and Provisions Agreement (Improvements) and not otherwise
defined herein shall have the same meanings herein as set forth in the Common
Definitions and Provisions Agreement (Improvements). All terms used in this
Agreement which are defined in the UCC and not otherwise defined herein shall
have the same meanings herein as set forth therein, except where the context
otherwise requires.

     Section 1.2 Definitions. When used in this Agreement, the following terms
                 -----------
shall have the following respective meanings:

          "Account" shall mean any deposit account maintained by a Deposit Taker
     into which Cash Collateral may be deposited at any time, excluding the
     Transition Account.

          "Account Office" shall mean, with respect to any Account maintained by
     any Deposit Taker, the office of such Deposit Taker in California or New
     York at which such Account is maintained as specified in the applicable
     Deposit Taker's Acknowledgment and Agreement.
<PAGE>

          "Agent" shall have the meaning given to that term in the introductory
paragraph hereof.

          "BNPLC" shall have the meaning given to that term in the introductory
paragraph hereof.

          "BNPLC's Corresponding Obligations to Participants" shall mean BNPLC's
obligations under the Participation Agreement to pay Participants their
respective Percentages of (or amounts equal to their respective Percentages of)
sums "actually received by BNPLC" (as defined in the Participation Agreement) in
satisfaction of Extreme's Purchase Agreement Obligations; provided, however, any
modification of the Participation Agreement executed after the date hereof
without Extreme's written consent shall not be considered for purposes of
determining BNPLC's Corresponding Obligations to Participants under this
Agreement.

          "Cash Collateral" shall mean (i) all money of Extreme which Extreme
has delivered to Agent for deposit with a Deposit Taker pursuant to this
Agreement, and (ii) any additional money delivered to Agent as Collateral
pursuant to Section 4.9.

          "Certificate of Deposit" shall mean a certificate of deposit issued by
a Deposit Taker as required by Section 5.4 below to evidence an Account into
which Cash Collateral has been deposited pursuant to this Agreement. Each
Certificate of Deposit shall be issued in an amount equal to the Value of the
Account which it evidences and shall otherwise be in the form set forth as
ATTACHMENT 1.
------------

          "Collateral" shall have the meaning given to that term in Section 2.1
hereof.

          "Collateral Imbalance" shall mean on any date prior to the Designated
Sale Date that the Value (without duplication) of Accounts maintained by and
Certificates of Deposit issued by the Deposit Taker for any Participant (other
than a Disqualified Deposit Taker) does not equal such Participant's Percentage,
multiplied by the lesser of (1) the Minimum Collateral Value in effect on such
date, or (2) the aggregate Value of all Collateral subject to this Agreement on
such date. For purposes of determining whether a Collateral Imbalance exists,
the Value of any Accounts maintained by a bank that is acting as Deposit Taker
for two or more Participants will be deemed to be held for them in proportion to
their respective Percentages, and the Value of any Accounts maintained by a bank
as Deposit Taker for both a Participant and BNPLC (as in the case of BNPLC's
Parent acting as Deposit Taker for itself, as a Participant, and for BNPLC) will
be deemed to be held for the Participant only to the extent necessary to prevent
or mitigate a Collateral Imbalance and otherwise for BNPLC.

         "Collateral Percentage" shall mean the percentage designated by Extreme
in accordance with this Agreement from time to time, but never less than the
Minimum Collateral Percentage established as provided in Part III of Schedule 1.
                                                                     ----------

          "Default" means any Event of Default and any default, event or
condition which would, with the giving of any requisite notices and the passage
of any requisite periods of time, constitute an Event of Default.

          "Deposit Taker" for BNPLC shall mean BNPLC's Parent and for each
Participant shall mean the Participant itself; provided, that each of BNPLC and
the Participants, for itself only, may from time to time designate another
Deposit Taker as provided in Sections 4.4 and 4.5 below.

                                      -2-
<PAGE>

          "Deposit Taker Losses" shall mean the Value of any Cash Collateral
delivered to a Deposit Taker, but that the Deposit Taker will not (because of
the insolvency of the Deposit Taker, offsets by the Deposit Taker in violation
of the Deposit Taker's Acknowledgment and Agreement, or otherwise) return to
Extreme or return to Agent for disposition or application as provided herein or
as required by applicable law.

          "Deposit Taker's Acknowledgment and Agreement" shall have the meaning
given to that term in subsection 4.1.2 hereof.

          "Disqualified Deposit Taker" shall mean any Deposit Taker with whom
Agent may decline to deposit Collateral pursuant to Section 4.1.

          "Event of Default" shall mean the occurrence of any of the following:

               (a)  the failure by Extreme to pay all or any part of Extreme's
          Purchase Agreement Obligations when due, after giving effect to any
          applicable notice and grace periods expressly provided for in the
          Purchase Agreement;

               (b)  the failure by Extreme to provide funds as and when required
          by Section 5.1 of this Agreement, if within seven Business Days after
          such failure commences Extreme does not (1) cure such failure by
          delivering the funds required by Section 5.1, and (2) pay to BNPLC as
          additional Rent under the Improvements Lease an amount equal to
          interest at the Default Rate (as defined in the Improvements Lease) on
          such funds for the period from which they were first due to the date
          of receipt by Agent;

               (c)  the failure of the pledge or security interest contemplated
          herein in the Transition Account or any Account, Certificate of
          Deposit or Cash Collateral to be a Qualified Pledge (regardless of the
          characterization of the Transition Account or any Accounts,
          Certificates of Deposit or Cash Collateral as deposit accounts,
          instruments or general intangibles under the UCC), unless:

                    (I)  such failure would not exist but for a breach of this
               Agreement by Agent or a breach of a Deposit Taker's
               Acknowledgment and Agreement by a Deposit Taker, or

                    (II) within five Business Days after Extreme becomes aware
               of such failure, Extreme shall (1) notify Agent, BNPLC and the
               Participants of such failure, and (2) cure such failure, and (3)
               to the extent required by Section 7.2.9, pay to BNPLC any
               additional Base Rent that has accrued under the Improvements
               Lease because of (or that would have accrued if BNPLC had been
               aware of) such failure, together with interest at the Default
               Rate on any such additional Base Rent;

               (d)  the failure of any representation herein by Extreme to be
          true (other than a failure described in another clause of this
          definition of Event of Default), if such failure is not cured within
          thirty days after Extreme receives written notice thereof from Agent;

               (e)  the failure of any representation made by Extreme in
          subsection 7.1.1 to be true, if within fifteen (15) days after Extreme
          becomes aware of such failure, Extreme does not (1) notify Agent,
          BNPLC and the Participants of such failure, and (2) cure such failure,
          and (3) pay to BNPLC any additional Base Rent that has accrued under
          the

                                      -3-
<PAGE>

          Improvements Lease because of (or that would have accrued if BNPLC had
          been aware of) such failure, and (4) pay to BNPLC interest at the
          Default Rate on any such additional Base Rent;

               (f)  the failure by Extreme timely and properly to observe, keep
          or perform any covenant, agreement, warranty or condition herein
          required to be observed, kept or performed (other than a failure
          described in another clause of this definition of Event of Default),
          if such failure is not cured within thirty days after Extreme receives
          written notice thereof from Agent; and

               (g)  the failure by BNPLC to pay when due on or after the
          Designated Sale Date any of BNPLC's Corresponding Obligations to
          Participants, after giving effect to any applicable notice and grace
          periods expressly provided for in the Participation Agreement.

     Notwithstanding the foregoing, if ever the aggregate Value of Cash
     Collateral held by Agent and the Deposit Takers exceeds the Minimum
                                                     -------
     Collateral Value then in effect, a failure of the pledge or security
     interest contemplated herein in such excess Cash Collateral to be a valid,
                                     -----------
     perfected, first priority pledge or security interest shall not constitute
     an Event of Default under this Agreement. Accordingly, to provide a cure as
     required to avoid an Event of Default under clauses (c) or (e) of this
     definition, Extreme could deliver additional Cash Collateral - the pledge
     of which or security interest in which created by this Agreement is a
     Qualified Pledge - sufficient in amount to cause the aggregate Value of the
     Cash Collateral then held by Agent and the Deposit Takers subject to a
     Qualified Pledge hereunder to equal or exceed the Minimum Collateral Value.

          "Extreme" shall have the meaning given to that term in the
     introductory paragraph hereof.

          "Extreme's Purchase Agreement Obligations" shall mean all of Extreme's
     obligations under the Purchase Agreement, including (i) Extreme's
     obligation to pay any Supplemental Payment as required under subparagraph
                                                                  ------------
     1(A) of the Purchase Agreement, and (ii) any damages incurred by BNPLC
     ----
     because of (A) Extreme's breach of the Purchase Agreement or (B) the
     rejection by Extreme of the Purchase Agreement in any bankruptcy or
     insolvency proceeding.

          "Initially Qualified Deposit Taker" means (1) BNP PARIBAS, acting
     through any branch, office or agency that can lawfully maintain an Account
     as a Deposit Taker hereunder, and (2) any of the fifty largest (measured by
     total assets) U.S. banks, or one of the one hundred largest (measured by
     total assets) banks in the world, with debt ratings of at least (i) A- (in
     the case of long term debt) and A-1 (in the case of short term debt) or the
     equivalent thereof by Standard and Poor's Corporation, and (ii) A3 (in the
     case of long term debt) and P-2 (in the case of short term debt) or the
     equivalent thereof by Moody's Investor Service, Inc. The parties believe it
     improbable that the ratings systems used by Standard and Poor's Corporation
     and by Moody's Investor Service, Inc. will be discontinued or changed, but
     if such ratings systems are discontinued or changed, Extreme shall be
     entitled to select and use a comparable ratings systems as a substitute for
     the S&P Rating or the Moody Rating, as the case may be, for purposes of
     determining the status of any bank as an Initially Qualified Deposit Taker.

          "Lien" shall mean, with respect to any property or assets, any right
     or interest therein of a creditor to secure indebtedness of any kind which
     is owed to him or any other arrangement with such creditor which provides
     for the payment of such indebtedness out of such property or assets or
     which allows him to have such indebtedness satisfied out of such property
     or assets prior to the general creditors of any owner thereof, including
     any lien, mortgage, security interest, pledge, deposit, production payment,
     rights of a vendor under any title retention or conditional sale

                                      -4-
<PAGE>

     agreement or lease substantially equivalent thereto, tax lien, mechanic's
     or materialman's lien, or any other charge or encumbrance for security
     purposes, whether arising by law or agreement or otherwise, but excluding
     any right of setoff which arises without agreement in the ordinary course
     of business. "Lien" also means any filed financing statement, any
     registration with an issuer of uncertificated securities, or any other
     arrangement which would serve to perfect a Lien described in the preceding
     sentence, regardless of whether such financing statement is filed, such
     registration is made, or such arrangement is undertaken before or after
     such Lien exists.

          "Material Lease Default" shall mean any of the following:

               (1)  any "Event of Default" under and as defined in the
          Improvements Lease, including any such Event of Default consisting of
          a failure of Extreme to comply with the requirements of Schedule I
                                                                  ----------
          attached to the Improvements Lease; and

               (2)(a) any failure of Extreme to make any payment required by and
          when first due under the Improvements Lease, regardless of whether any
          period provided in the Improvements Lease for the cure of such failure
          by Extreme shall have expired, and (b) any other default, event or
          condition which would, with the giving of any requisite notices and
          the passage of any requisite periods of time, constitute an "Event of
          Default" under and as defined in the Improvements Lease, if such other
          default, event or failure involves a material noncompliance with
          Applicable Law. (For purposes of this definition, "material"
          noncompliance with Applicable Law will include any noncompliance, the
          correction of which has been requested by a governmental authority, or
          because of which a threat of action against the Property or BNPLC has
          been asserted by a governmental authority.)

          "Minimum Collateral Percentage" shall mean the percentage established
     as such from time to time as described in Part III of Schedule 1.
                                                           ----------

          "Minimum Collateral Value" shall mean (1) as of the Designated Sale
     Date or any prior date, an amount equal to the Collateral Percentage
     multiplied by the Stipulated Loss Value determined as of that date in
     accordance with the Improvements Lease; and (2) as of any date after the
     Designated Sale Date, an amount equal to the Break Even Price plus any
     unpaid interest accrued on past due amounts payable pursuant to Paragraph
     1(a) of the Purchase Agreement.

          "Notice of Security Interest" shall have the meaning given to that
     term in subsection 4.1.1 hereof.

          "Other Liable Party" shall mean any Person, other than Extreme, who
     may now or may at any time hereafter be primarily or secondarily liable for
     any of the Secured Obligations or who may now or may at any time hereafter
     have granted to Agent a pledge of or security interest in any of the
     Collateral.

          "Participants" shall mean BNPLC's Parent and any other financial
     institutions which may hereafter become parties to (i) this Agreement by
     completing, executing and delivering to Extreme and Agent a Supplement, and
     (ii) the Participation Agreement.

          "Participation Agreement" shall have the meaning given to such term in
     Recital B hereof.

          "Percentage" shall mean with respect to each Participant and the
     Deposit Taker for such Participant, such Participant's "Percentage" under
     and as defined in the Participation Agreement

                                      -5-
<PAGE>

     for purposes of computing such Participant's right thereunder to receive
     payments of (or amounts equal to a percentage of) any sales proceeds or
     Supplemental Payment received by BNPLC under the Purchase Agreement.
     Percentages may be adjusted from time to time as provided in the
     Participation Agreement or as provided in supplements thereto executed as
     provided in the Participation Agreement.

          "Qualified Pledge" means a pledge or security interest that
     constitutes a valid, perfected, first priority pledge or security interest.

          "Secured Obligations" shall mean and include both Extreme's Purchase
     Agreement Obligations and BNPLC's Corresponding Obligations to
     Participants.

          "Supplement" shall mean a supplement to this Agreement in the form of
     ATTACHMENT 2.
     ------------

          "Transaction Documents" shall mean, collectively, this Agreement, the
     Improvements Lease, the Purchase Agreement and the Participation Agreement.

          "Transition Account" shall have the meaning given it in Section 5.2.

          "UCC" shall mean the Uniform Commercial Code as in effect in the State
     of California from time to time, and the Uniform Commercial Code as in
     effect in any other jurisdiction which governs the perfection or non-
     perfection of the pledge of and security interests in the Collateral
     created by this Agreement.

          "Value" shall mean with respect to any Account, Certificate of Deposit
     or Cash Collateral on any date, a dollar value determined as follows
     (without duplication):

               (a)  cash shall be valued at its face amount on such date;

               (b)  an Account shall be valued at the principal balance thereof
          on such date; and

               (c)  a Certificate of Deposit shall be valued at the face amount
          thereof.


     Section 1.3  Attachments. All attachments to this Agreement are a part
                  -----------
hereof for all purposes.

     Section 1.4  Amendment of Defined Instruments. Unless the context otherwise
                  --------------------------------
requires or unless otherwise provided herein, references in this Agreement to a
particular agreement, instrument or document (including references to the
Improvements Lease, Purchase Agreement and Participation Agreement) also refer
to and include all valid renewals, extensions, amendments, modifications,
supplements or restatements of any such agreement, instrument or document;
provided that nothing contained in this Section shall be construed to authorize
any Person to execute or enter into any such renewal, extension, amendment,
modification, supplement or restatement.

     Section 1.5  References and Titles. All references in this Agreement to
                  ---------------------
Attachments, Articles, Sections, subsections, and other subdivisions refer to
the Attachments, Articles, Sections, subsections and other subdivisions of this
Agreement unless expressly provided otherwise. Titles appearing at the beginning
of any subdivision are for convenience only and do not constitute any part of
any such subdivision and shall be disregarded in construing the language
contained in this Agreement. The words

                                      -6-
<PAGE>

"this Agreement", "herein", "hereof", "hereby", "hereunder" and words of similar
import refer to this Agreement as a whole and not to any particular subdivision
unless expressly so limited. The phrases "this Article," "this Section" and
"this subsection" and similar phrases refer only to the Articles, Sections or
subsections hereof in which the phrase occurs. The word "or" is not exclusive,
and the word "including" (in all of its forms) means "including without
limitation". Pronouns in masculine, feminine and neuter gender shall be
construed to include any other gender, and words in the singular form shall be
construed to include the plural and vice versa unless the context otherwise
requires.

                         ARTICLE II SECURITY INTEREST

     Section 2.1  Pledge and Grant of Security Interest. As security for the
                  -------------------------------------
Secured Obligations, Extreme hereby pledges and assigns to Agent (for the
ratable benefit of BNPLC and the Participants) and grants to Agent (for the
ratable benefit of BNPLC and the Participants) a continuing security interest
and lien in and against all right, title and interest of Extreme in and to the
following property, whether now owned or hereafter acquired by Extreme
(collectively and severally, the "Collateral"):

          (a)  All Cash Collateral, all Accounts, the Transition Account and all
     Certificates of Deposit issued from time to time and general intangibles
     arising therefrom or relating thereto (however, "general intangibles" as
     used in this clause shall not include any general intangibles not related
     to Cash Collateral, Accounts, the Transition Account or Certificates of
     Deposit issued from time to time, and thus will not include, without
     limitation, any intellectual property of Extreme); and all documents,
     instruments and agreements evidencing the same; and all extensions,
     renewals, modifications and replacements of the foregoing; and any interest
     or other amounts payable in connection therewith; and

          (b)  All proceeds of the foregoing (including whatever is receivable
     or received when Collateral or proceeds is invested, sold, collected,
     exchanged, returned, substituted or otherwise disposed of, whether such
     disposition is voluntary or involuntary, including rights to payment and
     return premiums and insurance proceeds under insurance with respect to any
     Collateral, and all rights to payment with respect to any cause of action
     affecting or relating to the Collateral).

The pledge, assignment and grant of a security interest made by Extreme
hereunder is for security of the Secured Obligations only; the parties to this
Agreement do not intend that Extreme's delivery of the Collateral to Agent as
herein provided will constitute an advance payment of any Secured Obligations or
liquidated damages, nor do the parties intend that the Collateral increase the
dollar amount of the Secured Obligations.

     Section 2.2 Return of Collateral After the Secured Obligations are
                 ------------------------------------------------------
Satisfied in Full. If any proceeds of Collateral remain after all Secured
-----------------
Obligations have been paid in full, Agent will deliver or direct the Deposit
Takers to deliver such proceeds to Extreme or other Persons entitled thereto by
law.

            ARTICLE III DETERMINATION OF THE COLLATERAL PERCENTAGE

     Section 3.1 Determination of the Collateral Percentage Generally.
                 ----------------------------------------------------
Effective as of the date of this Agreement, and until a new Collateral
Percentage becomes effective, the Collateral Percentage is 100%. Subject to the
provisions of this Article III, Extreme may from time to time designate a new
Collateral Percentage which is any multiple of 10% from 0% to 100% (i.e., 0%,
10%, 20%, 30%, etc.) by written notice delivered to Agent, BNPLC and the
Participants in the form of ATTACHMENT 3. Any new Collateral Percentage so
                            ------------
designated shall not become effective, however, until the commencement of the
next following Base Rent Period which is at least ten Business Days after the
receipt of such notice by Agent, BNPLC and the Participants. Further, if Extreme
provides more than one notice of a change in the

                                      -7-
<PAGE>

Collateral Percentage to be effective on a the first day of a particular Base
Rent Period, then the latest such notice from Extreme which satisfies the
requirements of the preceding sentence (and of Sections 3.2 and 3.3) will
control. Without limiting mandatory changes in the Collateral Percentage
required by Section 3.3, in no event shall the Collateral Percentage be changed
more often than once in any calendar quarter because of any election by Extreme
to designate a new Collateral Percentage as provided in this Section. After any
Collateral Percentage becomes effective as provided in this Article, it shall
remain in effect until a different Collateral Percentage becomes effective as
provided in this Article.

     Section 3.2  Limitations on Extreme's Right to Lower the Collateral
                  ------------------------------------------------------
Percentage. Notwithstanding the foregoing, no designation by Extreme of a new
----------
Collateral Percentage will be effective to reduce the Collateral Percentage if
the designation is given, or the reduction would otherwise become effective, on
or after the Designated Sale Date or when any of the following shall have
occurred and be continuing:

          3.2.1 any Material Lease Default;

          3.2.2 any Event of Default under and as defined in this Agreement; or

          3.2.3 any Default under and as defined in this Agreement - excluding,
     however, any such Default limited to a failure of Extreme described in
     clause (c) or clause (e) of the definition of Event of Default above, with
     respect to which the time for cure specified in clause (c) or clause (e),
     as applicable, has not expired.

     Section 3.3  Minimum Collateral Percentages Dependent Upon the Adjusted
                  ----------------------------------------------------------
EBITDAR Coverage Ratio. NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN
----------------------
CONTAINED, THE COLLATERAL PERCENTAGE SHALL NOT BE LESS THAN THE MINIMUM
COLLATERAL PERCENTAGE ESTABLISHED FROM TIME TO TIME AS DESCRIBED IN PART III OF
SCHEDULE 1. Accordingly, and because a new Base Rent Period will begin on the
----------
first Business Day of the first calendar month following any Failed Collateral
Test Date as provided in subparagraph 3(c)(ii)a) of the Improvements Lease,
                         -----------------------
Extreme shall be required by Section 5.1 to deliver additional Collateral on the
first Business Day of the first calendar month after any Failed Collateral Test
Date.

                ARTICLE IV PROVISIONS CONCERNING DEPOSIT TAKERS

     Section 4.1  Qualification of Deposit Takers Generally. Agent may decline
                  -----------------------------------------
to deposit or maintain Collateral hereunder with any Person designated as a
Deposit Taker, if such Person has failed to satisfy or no longer satisfies the
following requirements:

             4.1.1 Such Person must have received from Agent and Extreme a
     completed, executed Notice of Security Interest in the form of ATTACHMENT 4
                                                                    ------------
     (a "Notice of Security Interest") which specifically identifies any and all
     Accounts in which such Person shall hold Cash Collateral delivered to it
     pursuant to this Agreement and which designates Account Offices with
     respect to all such Accounts in New York or California.

             4.1.2 Such Person must have executed the Acknowledgment and
     Agreement at the end of such Notice of Security Interest (the "Deposit
     Taker's Acknowledgment and Agreement") and returned the same to Agent.
     Further, such Person must have complied with the Deposit Taker's
     Acknowledgment and Agreement, and the representations set forth therein
     with respect to such Person must continue to be true and correct.

             4.1.3 Such Person must be a commercial bank, organized under the
     laws of the United States of America or a state thereof or under the laws
     of another country which is doing business

                                      -8-
<PAGE>

          in the United States of America; must be authorized to maintain
          deposit accounts for others through Account Offices in New York or
          California (as specified in the Deposit Taker's Acknowledgment and
          Agreement); and must be an Affiliate of BNPLC or the Participant for
          whom such Person will act as Deposit Taker or must have a combined
          capital, surplus and undivided profits of at least $500,000,000.

               4.1.4  Such Person must have complied with the provisions in this
          Agreement applicable to Deposit Takers, including the provisions of
          Section 5.4 concerning the issuance and redemption of Certificates of
          Deposit.

          Section 4.2 Existing Deposit Takers. BNPLC's Parent (as Deposit Taker
                      -----------------------
for itself and for BNPLC) has received a Notice of Security Agreement dated the
Effective Date and has responded to such a notice with a Deposit Taker's
Acknowledgment and Agreement dated the Effective Date, as contemplated in
subsections 4.1.1 and 4.1.2.

          Section 4.3  Replacement of Participants Proposed by Extreme. So long
                       -----------------------------------------------
as no Event of Default has occurred and is continuing, BNPLC shall not
unreasonably withhold its approval for a substitution under the Participation
Agreement of a new Participant proposed by Extreme for any Participant, the
Deposit Taker for whom would no longer meet the requirements for an Initially
Qualified Deposit Taker; provided, however, that (A) the proposed substitution
can be accomplished without a release or breach by BNPLC of its rights and
obligations under the Participation Agreement; (B) the new Participant will
agree (by executing a Supplement and a supplement to the Participation Agreement
as contemplated therein and by other agreements as may be reasonably required by
BNPLC and Extreme) to become a party to the Participation Agreement and to this
Agreement, to designate an Initially Qualified Deposit Taker as the Deposit
Taker for it under this Agreement and to accept a Percentage under the
Participation Agreement equal to the Percentage of the Participant to be
replaced; (C) the new Participant (or Extreme) will provide the funds required
to pay the termination fee by Section 6.4 of the Participation Agreement to
                              -----------
accomplish the substitution; (D) Extreme (or the new Participant) agrees in
writing to indemnify and defend BNPLC for any and all Losses incurred by BNPLC
in connection with or because of the substitution, including the cost of
preparing supplements to the Participation Agreement and this Agreement and
including any cost of defending and paying any claim asserted by the Participant
to be replaced because of the substitution (but not including any liability of
BNPLC to such Participant for damages caused by BNPLC's bad faith or gross
negligence in the performance of BNPLC's obligations under the Participation
Agreement prior to the substitution); (E) the new Participant shall be a
reputable financial institution having a net worth of no less than seven and one
half percent (7.5%) of total assets and total assets of no less than
$10,000,000,000.00 (all according to then recent audited financial statements);
and (F) in no event will BNPLC be required to approve a substitution pursuant to
this Section 4.3 which will replace a Participant that is an Affiliate of BNPLC.
BNPLC shall attempt in good faith to assist (and cause BNPLC's Parent to attempt
in good faith to assist) Extreme in identifying a new Participant that Extreme
may propose to substitute for an existing Participant pursuant to this Section,
as Extreme may reasonably request from time to time. However, in no event shall
BNPLC itself, or any of its Affiliates, be required to take the Percentage of
any Participant to be replaced.

          Section 4.4  Mandatory Substitution for Disqualified Deposit Takers.
                       ------------------------------------------------------
If any Deposit Taker shall cease to satisfy the requirements set forth in
Section 4.1, the party for whom such Disqualified Deposit Taker has been
designated as Deposit Taker (i.e., BNPLC or the applicable Participant) shall
promptly (1) provide notice thereof to Agent and Extreme, and (2) designate a
substitute Deposit Taker and cause the substitute to satisfy the requirements
set forth in Section 4.1. Pending the designation of the substitute and the
satisfaction by it of the requirements set forth in Section 4.1, Agent may
withdraw Collateral held by the Disqualified Deposit Taker and deposit such
Collateral with other Deposit Takers, subject to Section 5.3 below.

                                      -9-
<PAGE>

          Section 4.5  Voluntary Substitution of Deposit Takers. With the
                       ----------------------------------------
written approval of Agent, which approval will not be unreasonably withheld,
BNPLC or any Participant may at any time designate for itself a new Deposit
Taker (in replacement of any prior Deposit Taker acting for it hereunder);
provided, the Person so designated has satisfied the requirements set forth in
Section 4.1; and, provided further, unless the designation of a new Deposit
Taker is required by Section 4.4 to replace a Disqualified Deposit Taker, at the
time of the replacement such Person must be an Initially Qualified Deposit
Taker.

          Section 4.6  Delivery of Notice of Security Interest by Extreme and
                       ------------------------------------------------------
Agent. To the extent required for the designation of a new Deposit Taker by
-----
BNPLC or any Participant pursuant to Section 4.5, or to permit the substitution
or replacement of a Deposit Taker for BNPLC or any Participant as provided in
Sections 4.4 and 4.5, Extreme and Agent shall promptly execute and deliver any
properly completed Notice of Security Interest requested by BNPLC or the
applicable Participant.

          Section 4.7  Constructive Possession of Collateral. The possession by
                       -------------------------------------
a Deposit Taker of any deposit accounts, money, instruments, chattel paper or
other property constituting Collateral or evidencing Collateral shall be deemed
to be possession by Agent or a person designated by Agent, for purposes of
perfecting the security interest granted to Agent hereunder pursuant to the UCC
or other Applicable Law; and notifications to a Deposit Taker by other Persons
holding any such property, and Acknowledgments, receipts or confirmations from
any such Persons delivered to a Deposit Taker, shall be deemed notifications to,
or Acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of such Deposit Taker for the benefit of Agent
for the purposes of perfecting such security interests under Applicable Law.

          Section 4.8  Attempted Setoff by Deposit Takers. By delivery of a
                       ----------------------------------
Deposit Taker's Acknowledgment and Agreement, each Deposit Taker shall be
required to agree not to setoff or attempt a setoff, without in each case first
                                                     --------------------------
obtaining the prior written authorization of Agent, Secured Obligations owed to
--------------------------------------------------
it against any Collateral held by it from time to time. Further, by delivery of
a Deposit Taker's Acknowledgment and Agreement, each Deposit Taker shall be
required to agree not to setoff or attempt a setoff, without in each case first
                                                     --------------------------
obtaining the prior written authorization of both Extreme and Agent, obligations
-------------------------------------------------------------------
owed to it other than Secured Obligations against any Collateral held by it from
time to time. Any Deposit Taker for BNPLC or a Participant shall not be
permitted by BNPLC or the applicable Participant, as the case may be, to violate
such agreements. However, Extreme acknowledges and agrees (without limiting its
right to recover damages from a Deposit Taker that violates such agreements)
that Agent shall not be responsible for, or be deemed to have taken any action
against Extreme because of, any Deposit Taker's violation of such agreements;
and, neither BNPLC nor any Participant shall be responsible for, or be deemed to
have taken any action against Extreme because of, any violation of such
agreements by a Deposit Taker for another party.

          Section 4.9  Deposit Taker Losses. Agent shall not be responsible for
                       --------------------
any Deposit Taker Losses. However, Deposit Taker Losses with respect to a
Deposit Taker for a particular Participant shall reduce the amount of BNPLC's
Corresponding Obligations to Participants which are payable to such Participant
as provided in Section 2.2 of the Participation Agreement. Further, when Deposit
               -----------
Taker Losses with respect to a Deposit Taker for a particular Participant are
incurred in excess of the payments of Secured Obligations that such Participant
would then have been entitled to receive under the Participation Agreement but
for such Deposit Taker Losses, such Participant must immediately pay the excess
to Agent as additional Collateral hereunder, failing which Extreme may recover
any damages suffered by it because of the Deposit Taker Losses from such Deposit
Taker or such Participant.

          Section 4.10 Losses Resulting from Failure of Deposit Taker to Comply
                       --------------------------------------------------------
with this Agreement. Any Participant, the Deposit Taker for whom has failed to
-------------------
comply with the requirements of this Agreement or any Notices of Security
Interest and any Deposit Taker's Acknowledgments and Agreements (the

                                     -10-
<PAGE>

"Responsible Participant") must defend, indemnify, and hold harmless BNPLC,
Agent and the other Participants from and against any Losses resulting from such
failure. Without limiting the foregoing, if the failure of a Deposit Taker for a
Responsible Participant to comply strictly with the terms of this Agreement
(including, without limitation, the provisions of Section 5.4 concerning the
issuance and redemption of Certificates of Deposit and the requirement that any
cash deposits be held in a deposit account located in either New York or
California) causes, in whole or in part, the security interest of Agent in the
Collateral held by such Deposit Taker to be unperfected, then any and all Losses
suffered as a result of such nonperfection shall be borne solely by the
Responsible Participant and shall not be shared by BNPLC, Agent or the other
Participants.

             ARTICLE V DELIVERY AND MAINTENANCE OF CASH COLLATERAL

          Section 5.1  Delivery of Funds by Extreme. On the first day of any
                       ----------------------------
Base Rent Period, and on any other date designated in a notice given by Agent to
Extreme at least three Business Days prior to the date so designated, Extreme
must deliver to Agent, subject to the pledge and security interest created
hereby, funds as Cash Collateral then needed (if any) to cause the Value of the
Collateral to be no less than the Minimum Collateral Value. Each delivery of
funds required by the preceding sentence must be received by Agent no later than
12:00 noon (San Francisco time) on the date it is required; if received after
12:00 noon it will be considered for purposes of the Improvements Lease as
received on the next following Business Day. At least five Business Days prior
to the first day of any Base Rent Period upon which it is expected that Extreme
will be required to deliver additional funds pursuant to this Section, Extreme
shall notify BNPLC, Agent and each of the Participants thereof and of the amount
Extreme expects to deliver to Agent as Cash Collateral on the applicable Base
Rent Date. In addition to required deliveries of Cash Collateral as provided in
the foregoing provisions, Extreme may on any date (whether or not the first day
of a Base Rent Period) deliver additional Cash Collateral to Agent as necessary
to prevent any Default from becoming an Event of Default. Upon receipt of any
funds delivered to it by Extreme as Cash Collateral, Agent shall immediately
deposit the same with the Deposit Takers in accordance with the requirements of
Sections 5.3 and 5.4 below.

          Section 5.2  Transition Account. Pending deposit in the Accounts or
                       ------------------
other application as provided herein, all Cash Collateral received by Agent
shall be credited to and held by Agent in an account (the "Transition Account")
styled "Extreme Collateral Account, held for the benefit of BNP Leasing
Corporation and the Participants," separate and apart from all other property
and funds of Extreme or other Persons, and no other property or funds shall be
deposited in the Transition Account. The books and records of Agent shall
reflect that the Transition Account and all Cash Collateral on deposit therein
are owned by Extreme, subject to a pledge and security interest in favor of
Agent for the benefit of BNPLC and Participants.

          Section 5.3  Allocation of Cash Collateral Among Deposit Takers. Funds
                       --------------------------------------------------
received by Agent from Extreme as Cash Collateral will be allocated for deposit
among the Deposit Takers as follows:

          first, to the extent possible the funds will be allocated as required
          -----
          to rectify and prevent any Collateral Imbalance; and

          second, the funds will be allocated to the Deposit Taker for BNPLC,
          ------
          unless the Deposit Taker for BNPLC has become a Disqualified Deposit
          Taker, in which case the funds will be allocated to other Deposit
          Takers who are not Disqualified Deposit Takers as Agent deems
          appropriate.

Further, if for any reason a Collateral Imbalance is determined by Agent to
exist, Agent shall, as required to rectify or mitigate the Collateral Imbalance,
promptly reallocate Collateral among Deposit Takers by withdrawing Cash
Collateral from some Accounts and redepositing it in other Accounts. (If any
party to

                                     -11-
<PAGE>

this Agreement believes that the Value of the Accounts held by a particular
Deposit Taker causes a Collateral Imbalance to exist, that party will promptly
notify BNPLC, Extreme and Agent.) Subject to the foregoing, and provided that
Agent does not thereby create or exacerbate a Collateral Imbalance, Agent may
withdraw and redeposit Cash Collateral in order to reallocate the same among
Deposit Takers from time to time as Agent deems appropriate. For purposes of
illustration only, examples of the allocations required by this Section are set
forth in ATTACHMENT 5.
         ------------

          Section 5.4  Issuance and Redemption of Certificates of Deposit. Upon
                       --------------------------------------------------
the receipt of any deposit of Cash Collateral from Agent, each Deposit Taker
shall issue a Certificate of Deposit evidencing the Account into which such
deposit is made and deliver such Certificate of Deposit to Agent for the benefit
of BNPLC and the Participants. Each Certificate of Deposit shall be issued in an
amount equal to the Value of the Account which it evidences and shall otherwise
be in the form set forth as ATTACHMENT 1 to this Agreement. Upon depositing any
                            ------------
Cash Collateral into an Account that is already evidenced by an outstanding
Certificate of Deposit, Agent will surrender the outstanding Certificate of
Deposit, and in exchange the Deposit Taker receiving the deposit will issue a
new Certificate of Deposit, evidencing the total amount of Cash Collateral in
the Account after the deposit. A Deposit Taker that has issued a Certificate of
Deposit may require the surrender of the Certificate of Deposit as a condition
to a withdrawal from the Account evidenced thereby, including any withdrawal
required or permitted by this Agreement. Upon surrender of a Certificate of
Deposit in connection with a withdrawal of less than all of the Cash Collateral
in the Account evidenced thereby, the applicable Deposit Taker will concurrently
issue a new Certificate of Deposit to Agent, evidencing the balance of the Cash
Collateral remaining on deposit in the Account after the withdrawal.
Notwithstanding the foregoing, if any Certificate of Deposit held by Agent shall
be destroyed, lost or stolen, the Deposit Taker that issued the Certificate,
upon the written request of Agent, shall issue a new Certificate of Deposit to
Agent in lieu of and in substitution for the Certificate of Deposit so
destroyed, lost or stolen. However, as applicant for the substitute Certificate
of Deposit, Agent must indemnify (at no cost to Extreme) the applicable Deposit
Taker against any liability on the Certificate of Deposit destroyed, lost or
stolen, and Agent shall furnish to the Deposit Taker an affidavit of an officer
of Agent setting forth the fact of destruction, loss or theft and confirming the
status of Agent as holder of the Certificate of Deposit immediately prior to the
destruction, loss or theft. If any Certificate of Deposit held by Agent shall
become mutilated, the Deposit Taker that issued the Certificate, upon the
written request of Agent, shall issue a new Certificate of Deposit to Agent in
exchange and substitution for the mutilated Certificate of Deposit. Agent shall
hold all Certificates of Deposit for the benefit of BNPLC and the Participants,
subject to the pledge and security interest created hereby.

          Section 5.5  Status of the Accounts Under the Reserve Requirement
                       ----------------------------------------------------
Regulations. Deposit Takers shall be permitted to structure the Accounts as
-----------
nonpersonal time deposits under 12 C.F.R., Part II, Chapter 204 (commonly known
as "Regulation D"). Accordingly, each Deposit Taker may require at least seven
days advance notice of any withdrawal or transfer of funds from Accounts it
maintains and may limit the number of withdrawals or transfers from such
Accounts to no more than six in any calendar month, notwithstanding anything to
the contrary herein or in any deposit agreement that Extreme and any Deposit
Taker may enter into with respect to any Account. As necessary to satisfy the
seven days notice requirement with respect to withdrawals by Agent when required
by Extreme pursuant to the provisions below, Agent shall notify Deposit Takers
promptly after receipt of any notice from Extreme described in subsection 6.1.2
or 6.2.1 or in Section 6.3.

          Section 5.6  Acknowledgment by Extreme that Requirements of this
                       ---------------------------------------------------
Agreement are Commercially Reasonable. Extreme acknowledges and agrees that the
-------------------------------------
requirements set forth herein concerning receipt, deposit, withdrawal,
allocation, application and distribution of Cash Collateral by Agent, including
the requirements and time periods set forth in the next Article, are
commercially reasonable.

                                     -12-
<PAGE>

                   ARTICLE VI WITHDRAWAL OF CASH COLLATERAL

Extreme may not withdraw Cash Collateral, except as follows:

          Section 6.1 Withdrawal of Collateral Prior to the Designated Sale
                      -----------------------------------------------------
Date. Extreme may require Agent to present Certificates of Deposit for payment
----
and withdraw Cash Collateral from Accounts on any date prior to the Designated
Sale Date and to deliver such Cash Collateral to Extreme (which delivery shall
be free and clear of all liens and security interests hereunder); provided,
however, that in each case:

               6.1.1  Such withdrawal and delivery of the Cash Collateral to
          Extreme will not cause the Value of the remaining Collateral to be
          less than the Minimum Collateral Value.

               6.1.2  by a notice in the form of ATTACHMENT 6, Extreme must
                                                 ------------
          give Agent, BNPLC and the Participants notice of the required
          withdrawal at least ten days prior to the date upon which the
          withdrawal is to occur.

               6.1.3  No Default or Event of Default shall have occurred and
          be continuing at the time Extreme gives the notice required by the
          preceding subsection or on the date upon which the withdrawal is
          required.

               6.1.4  Extreme must pay to Agent any and all costs incurred by
          Agent in connection with the withdrawal.

               6.1.5  Agent shall determine the Accounts from which to make
          any withdrawal required by Extreme pursuant to this Section as
          necessary to prevent or mitigate any Collateral Imbalance.

          Section 6.2 Withdrawal and Application of Cash Collateral to Reduce or
                      ----------------------------------------------------------
Satisfy the Secured Obligations to the Participants. To reduce the "Break Even
---------------------------------------------------
Price" or "Supplemental Payment" required under (and as defined in) the Purchase
Agreement (and, thus, to reduce the Secured Obligations), Extreme may require
Agent to withdraw Cash Collateral then held by or for Agent pursuant to this
Agreement on the Designated Sale Date and to deliver the same on the Designated
Sale Date or on any date thereafter prior to an Event of Default (which delivery
shall be free and clear of all liens and security interests hereunder) directly
to the Participants in proportion to their respective rights to payment of
BNPLC's Corresponding Obligations to Participants and for application thereto or
the reduction thereof pursuant to Section 2.2 of the Participation Agreement;
                                  -----------
provided, that:

               6.2.1  by a notice in the form of ATTACHMENT 7, Extreme must
                                                 ------------
          have notified Agent, BNPLC and each of the Participants of the
          required withdrawal and payment to Participants at least ten days
          prior to the date upon which it is to occur;

               6.2.2  the required withdrawal shall be made as determined by
          Agent, first, from the Accounts maintained by the Deposit Takers for
          the Participants, and then (to the extent necessary) from the Accounts
          maintained by the Deposit Taker for BNPLC; and

               6.2.3  in any event, no withdrawals or payments directly to
          Participants shall be required by this Section 6.2 (or permitted over
          the objection of BNPLC) in excess of those required to satisfy BNPLC's
          Corresponding Obligations to Participants or to reduce such
          obligations to zero under the Participation Agreement.

          Section 6.3 Withdrawal and Application of Cash Collateral to Reduce or
                      ----------------------------------------------------------
Satisfy the Secured Obligations to BNPLC. To satisfy Extreme's Purchase
----------------------------------------
Agreement Obligations, Extreme may require

                                     -13-
<PAGE>

Agent to withdraw any Cash Collateral held by the Deposit Taker for BNPLC
pursuant to this Agreement on the Designated Sale Date and to deliver the same
on the Designated Sale Date or on any date thereafter prior to an Event of
Default (which delivery shall be free and clear of all liens and security
interests hereunder) directly to BNPLC as a payment on behalf of Extreme of
amounts due under the Purchase Agreement; provided, that by a notice in the form
of ATTACHMENT 8, Extreme must have notified Agent and BNPLC of the required
   ------------
withdrawal and payment to BNPLC at least ten days prior to the date upon which
it is to occur.

          Section 6.4  Withdrawal of Cash Collateral From Accounts Maintained by
                       ---------------------------------------------------------
Disqualified Deposit Takers. Extreme may from time to time prior to the
---------------------------
Designated Sale Date (regardless of the existence of any Default or Event of
Default) require Agent to withdraw any or all Cash Collateral from any Account
maintained by a Disqualified Deposit Taker and deposit it, still subject to the
pledge and grant of security interest hereunder, with other Deposit Takers who
are not Disqualified Deposit Takers (in accordance with the requirements of
Sections 5.3 and 5.4) on any date prior to the Designated Sale Date; provided,
that by a notice in the form of ATTACHMENT 9, Extreme must have notified Agent,
BNPLC and each of the Participants of the required withdrawal at least ten days
prior to the date upon which it is to occur.

             ARTICLE VII REPRESENTATIONS AND COVENANTS OF EXTREME

          Section 7.1  Representations of Extreme. Extreme represents to BNPLC,
                       --------------------------
Agent and the Participants as follows:

               7.1.1  Extreme is the legal and beneficial owner of the
          Collateral (or, in the case of after-acquired Collateral, at the time
          Extreme acquires rights in the Collateral, will be the legal and
          beneficial owner thereof). No other Person has (or, in the case of
          after-acquired Collateral, at the time Extreme acquires rights
          therein, will have) any right, title, claim or interest (by way of
          Lien, purchase option or otherwise) in, against or to the Collateral,
          except for rights created hereunder.

               7.1.2  Agent has (or in the case of after-acquired Collateral,
          at the time Extreme acquires rights therein, will have) a valid, first
          priority, perfected pledge of and security interest in the Collateral,
          regardless of the characterization of the Collateral as deposit
          accounts, instruments or general intangibles under the UCC, but
          assuming that the representations of each Deposit Taker in its Deposit
          Taker's Acknowledgment and Agreement are true.

               7.1.3  Extreme has delivered to Agent, together with all
          necessary stock powers, endorsements, assignments and other necessary
          instruments of transfer, the originals of all documents, instruments
          and agreements evidencing Accounts, Certificates of Deposit or Cash
          Collateral.

               7.1.4  Extreme's chief executive office is located at the
          address of Extreme set forth in Article II of the Common Definitions
          and Provisions Agreement (Improvements) or at another address in
          California specified in a notice that Extreme has given to Agent as
          required by Section 7.2.4.

               7.1.5  To the knowledge of Extreme, neither the ownership or
          the intended use of the Collateral by Extreme, nor the pledge of
          Accounts or the grant of the security interest by Extreme to Agent
          herein, nor the exercise by Agent of its rights or remedies hereunder,
          will (i) violate any provision of (a) Applicable Law, (b) the articles
          or certificate of incorporation, charter or bylaws of Extreme, or (c)
          any agreement, judgment, license, order or permit applicable to or
          binding upon Extreme, or (ii) result in or require the creation of any
          Lien, charge or encumbrance upon any assets or properties of Extreme
          except as expressly contemplated in this Agreement. Except as

                                     -14-
<PAGE>

          expressly contemplated in this Agreement, to the knowledge of Extreme
          no consent, approval, authorization or order of, and no notice to or
          filing with any court, governmental authority or third party is
          required in connection with the pledge or grant by Extreme of the
          security interest contemplated herein or the exercise by Agent of its
          rights and remedies hereunder.

          Section 7.2  Covenants of Extreme.  Extreme hereby agrees as follows:
                       --------------------

               7.2.1  Extreme, at Extreme's expense, shall promptly procure,
          execute and deliver to Agent all documents, instruments and agreements
          and perform all acts which are necessary, or which Agent may
          reasonably request, to establish, maintain, preserve, protect and
          perfect the Collateral, the pledge thereof to Agent or the security
          interest granted to Agent therein and the first priority of such
          pledge or security interest or to enable Agent to exercise and enforce
          its rights and remedies hereunder with respect to any Collateral.
          Without limiting the generality of the preceding sentence, Extreme
          shall (A) procure, execute and deliver to Agent all stock powers,
          endorsements, assignments, financing statements and other instruments
          of transfer requested by Agent, (B) deliver to Agent promptly upon
          receipt all originals of Collateral consisting of instruments,
          documents and chattel paper, (C) cause the security interest of Agent
          in any Collateral consisting of securities to be recorded or
          registered in the books of any financial intermediary or clearing
          corporation requested by Agent, and (D) reimburse Agent upon request
          for any legal opinion Agent may elect to obtain from a nationally
          recognized commercial law firm authorized to practice in New York
          concerning the enforceability, first priority and perfection of
          Agent's security interest in any Collateral maintained in New York, if
          BNPLC or any Participant should at any time elect to use a Deposit
          Taker that will maintain one or more Accounts in New York.

               7.2.2  Extreme shall not use or consent to any use of any
          Collateral in violation of any provision of this Agreement or any
          other Transaction Document or any Applicable Law.

               7.2.3  Extreme shall pay promptly when due all taxes and other
          governmental charges, all Liens and all other charges now or hereafter
          imposed upon, relating to or affecting any Collateral.

               7.2.4  Without thirty days' prior written notice to Agent,
          Extreme shall not change Extreme's name or place of business (or, if
          Extreme has more than one place of business, its chief executive
          office).

               7.2.5  Extreme shall appear in and defend, on behalf of Agent,
          any action or proceeding which may affect Extreme's title to or
          Agent's interest in the Collateral.

               7.2.6  Subject to the express rights of Extreme under Article
          VI, Extreme shall not surrender or lose possession of (other than to
          Agent or a Deposit Taker pursuant hereto), sell, encumber, lease,
          rent, option, or otherwise dispose of or transfer any Collateral or
          right or interest therein, and Extreme shall keep the Collateral free
          of all Liens.

               7.2.7  Extreme will not take any action which would in any
          manner impair the value or enforceability of Agent's pledge of or
          security interest in any Collateral, nor will Extreme fail to take any
          action which is required to prevent (and which Extreme knows is
          required to prevent) an impairment of the value or enforceability of
          Agent's pledge of or security interest in any Collateral.

               7.2.8  Extreme shall pay (and shall indemnify and hold harmless
          Agent from and against) all Losses incurred by Agent in connection
          with or because of (A) the interest acquired by Agent in any
          Collateral pursuant to this Agreement, or (B) the negotiation or
          administration of this Agreement, whether such Losses are incurred at
          the time of execution of this Agreement or at any time in the future.
          Costs and expenses included in such Losses may include, without
          limitation, all

                                     -15-
<PAGE>

          filing and recording fees, taxes, UCC search fees and Attorneys' Fees
          incurred by Agent with respect to the Collateral.

               7.2.9  Without limiting the foregoing, within five Business Days
          after Extreme becomes aware of any failure of the pledge or security
          interest contemplated herein in the Transition Account or any Account,
          Certificate of Deposit or Cash Collateral to be a valid, perfected,
          first priority pledge or security interest (regardless of the
          characterization of the Transition Account or any Accounts,
          Certificates of Deposit or Cash Collateral as deposit accounts,
          instruments or general intangibles under the UCC), Extreme shall
          notify Agent, BNPLC and the Participants of such failure. In addition,
          if the failure would not exist but for Extreme's delivery of Cash
          Collateral to Agent subject to prior Liens or other claims by one or
          more third parties, or but for the grant by Extreme itself of any Lien
          or other interest in the Collateral to one or more third parties,
          then, in addition to any other remedies available to BNPLC or Agent
          under the circumstances, Extreme must pay to BNPLC any additional Base
          Rent that has accrued under the Improvements Lease because of (or that
          would have accrued if BNPLC had been aware of) the failure, together
          with interest at the Default Rate on any such additional Base Rent.

                    ARTICLE VIII AUTHORIZED ACTION BY AGENT

          Section 8.1 Power of Attorney. Extreme hereby irrevocably appoints
                      -----------------
Agent as Extreme's attorney-in-fact for the purpose of authorizing Agent to
perform (but Agent shall not be obligated to and shall incur no liability to
Extreme or any third party for failure to perform) any act which Extreme is
obligated by this Agreement to perform, and to exercise, consistent with the
other provisions of this Agreement, such rights and powers as Extreme might
exercise with respect to the Collateral during any period in which a Default or
Event of Default has occurred and is continuing, including the right to (a)
collect by legal proceedings or otherwise and endorse, receive and receipt for
all dividends, interest, payments, proceeds and other sums and property now or
hereafter payable on or on account of the Collateral; (b) enter into any
extension, reorganization, deposit, merger, consolidation or other agreement
pertaining to, or deposit, surrender, accept, hold or apply other property in
exchange for the Collateral; (c) insure, process, preserve and enforce the
Collateral; (d) make any compromise or settlement, and take any action it deems
advisable, with respect to the Collateral; (e) pay any indebtedness of Extreme
relating to the Collateral; and (f) execute UCC financing statements and other
documents, instruments and agreements required hereunder. Extreme agrees that
such care as Agent gives to the safekeeping of its own property of like kind
shall constitute reasonable care of the Collateral when in Agent's possession;
provided, however, that Agent shall not be obligated to Extreme to give any
--------  -------
notice or take any action to preserve rights against any other Person in
connection with the Secured Obligations or with respect to the Collateral.

                       ARTICLE IX DEFAULT AND REMEDIES

          Section 9.1 Remedies. In addition to all other rights and remedies
                      --------
granted to Agent, BNPLC or the Participants by this Agreement, the Improvements
Lease, the Purchase Agreement, the Participation Agreement, the UCC and other
Applicable Laws, Agent may, upon the occurrence and during the continuance of
any Event of Default, exercise any one or more of the following rights and
remedies, all of which will be in furtherance of its rights as a secured party
under the UCC:

               (a)  Agent may collect, receive, appropriate or realize upon
          the Collateral or otherwise foreclose or enforce the pledge of or
          security interests in any or all Collateral in any manner permitted by
          Applicable Law or in this Agreement; and

                                     -16-
<PAGE>

               (b)  Agent may notify any or all Deposit Takers to pay all or any
          portion of the Collateral held by such Deposit Taker(s) directly to
          Agent.

Agent shall distribute the proceeds of all Collateral received by Agent after
the occurrence of an Event of Default to BNPLC and the Participants for
application to the Secured Obligations. If any proceeds of Collateral remain
after all Secured Obligations have been paid in full, Agent will deliver or
direct the Deposit Takers to deliver such proceeds to Extreme or other Persons
entitled thereto. In any case where notice of any sale or disposition of any
Collateral is required, Extreme hereby agrees that seven (7) Business Days
notice of such sale or disposition is reasonable.

                           ARTICLE X  OTHER RECOURSE

          Section 10.1 Recovery Not Limited. To the fullest extent permitted by
                       --------------------
applicable law, Extreme waives any right to require that Agent, BNPLC or the
Participants proceed against any other Person, exhaust any Collateral or other
security for the Secured Obligations, or to have any Other Liable Party joined
with Extreme in any suit arising out of the Secured Obligations or this
Agreement, or pursue any other remedy in their power. Extreme waives any and all
notice of acceptance of this Agreement. Extreme further waives notice of the
creation, modification, rearrangement, renewal or extension for any period of
any of the Secured Obligations of any Other Liable Party from time to time and
any defense arising by reason of any disability or other defense of any Other
Liable Party or by reason of the cessation from any cause whatsoever of the
liability of any Other Liable Party. Until all of the Secured Obligations shall
have been paid in full, Extreme shall have no right to subrogation,
reimbursement, contribution or indemnity against any Other Liable Party and
Extreme waives the right to enforce any remedy which Agent, BNPLC or any
Participant has or may hereafter have against any Other Liable Party, and waives
any benefit of and any right to participate in any other security whatsoever now
or hereafter held by Agent, BNPLC or any Participant. Extreme authorizes Agent,
BNPLC and the Participants, without notice or demand and without any reservation
of rights against Extreme and without affecting Extreme's liability hereunder or
on the Secured Obligations, from time to time to (a) take or hold any other
property of any type from any other Person as security for the Secured
Obligations, and exchange, enforce, waive and release any or all of such other
property, (b) after any Event of Default, apply or require the application of
the Collateral (in accordance with this Agreement) or such other property in any
order they may determine and to direct the order or manner of sale thereof as
they may determine, (c) renew, extend for any period, accelerate, modify,
compromise, settle or release any of the obligations of any Other Liable Party
with respect to any or all of the Secured Obligations or other security for the
Secured Obligations, and (d) release or substitute any Other Liable Party.

                    ARTICLE XI PROVISIONS CONCERNING AGENT

          In the event of any conflict between the following and other
provisions in this Agreement, the following will control:

          Section 11.1 Appointment and Authority. BNPLC and each Participant
                       -------------------------
hereby irrevocably authorizes Agent, and Agent hereby undertakes, to take all
actions and to exercise such powers under this Agreement as are specifically
delegated to Agent by the terms hereof, together with all other powers
reasonably incidental thereto. The relationship of Agent to the Participants is
only that of one commercial bank acting as collateral agent for others, and
nothing herein shall be construed to constitute Agent a trustee or other
fiduciary for any Participant or anyone claiming through or under a Participant
nor to impose on Agent duties and obligations other than those expressly
provided for in this Agreement. With respect to any matters not expressly
provided for in this Agreement and any matters which this Agreement places
within the discretion of Agent, Agent shall not be required to exercise any
discretion or take any action, and it may request instructions from BNPLC and
Participants with respect to any such matter, in

                                     -17-
<PAGE>

which case it shall be required to act or to refrain from acting (and shall be
fully protected and free from liability to all Participants in so acting or
refraining from acting) upon the instructions of the Majority, as defined in the
Participation Agreement, including itself as a Participant and BNPLC; provided,
however, that Agent shall not be required to take any action which exposes it to
a risk of personal liability that it considers unreasonable or which is contrary
to this Agreement or the other documents referenced herein or to Applicable Law.

         Section 11.2 Exculpation, Agent's Reliance, Etc. Neither Agent nor any
                      ----------------------------------
of its directors, officers, agents, attorneys, or employees shall be liable for
any action taken or omitted to be taken by any of them under or in connection
with this Agreement, INCLUDING THEIR NEGLIGENCE OF ANY KIND, except that each
shall be liable for its own gross negligence or willful misconduct. Without
limiting the generality of the foregoing, Agent (1) may treat the rights of any
Participant under its Participation Agreement as continuing until Agent receives
written notice of the assignment or transfer of those rights in accordance with
such Participation Agreement, signed by such Participant and in form
satisfactory to Agent; (2) may consult with legal counsel (including counsel for
Extreme), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts, unless
the action taken or omitted constitutes misconduct; (3) makes no warranty or
representation and shall not be responsible for any statements, warranties or
representations made in or in connection with this Agreement or the other
documents referenced herein; (4) shall not have any duty to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions of the Transaction Documents on the part of any party thereto, or to
inspect the property (including the books and records) of any party thereto; (5)
shall not be responsible to any Participant for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of any Transaction
Document or any instrument or document furnished in connection therewith; (6)
may rely upon the representations and warranties of Extreme, Participants and
Deposit Takers in exercising its powers hereunder; and (7) shall incur no
liability under or in respect of the Transaction Documents by acting upon any
notice, consent, certificate or other instrument or writing (including any
telecopy, telegram, cable or telex) believed by it to be genuine and signed or
sent by the proper Person or Persons.

         Section 11.3 Participant's Credit Decisions. Each Participant
                      ------------------------------
acknowledges that it has, independently and without reliance upon Agent or any
other Participant, made its own analysis of Extreme and the transactions
contemplated hereby and its own independent decision to enter into the
Transaction Documents to which it is a party. Each Participant also acknowledges
that it will, independently and without reliance upon Agent or any other
Participant and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Transaction Documents.

         Section 11.4 Indemnity. Each Participant agrees to indemnify Agent (to
                      ---------
the extent not reimbursed by Extreme within ten days after demand) from and
against such Participant's Percentage of any and all Losses of any kind or
nature whatsoever which to any extent (in whole or in part) may be imposed on,
incurred by, or asserted against Agent growing out of, resulting from or in any
other way associated with any of the Collateral, the Transaction Documents and
the transactions and events (including the enforcement thereof) at any time
associated therewith or contemplated therein. THE FOREGOING INDEMNIFICATION
SHALL APPLY WHETHER OR NOT SUCH LOSSES ARE IN ANY WAY OR TO ANY EXTENT OWED, IN
                                -
WHOLE OR IN PART, UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY, OR ARE CAUSED,
IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY AGENT,
PROVIDED ONLY THAT NO PARTICIPANT SHALL BE OBLIGATED UNDER THIS SECTION TO
INDEMNIFY AGENT FOR THAT PORTION, IF ANY, OF ANY LOSS WHICH IS PROXIMATELY
                                                 -
CAUSED BY AGENT'S OWN INDIVIDUAL GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, AS
DETERMINED IN A

                                     -18-
<PAGE>

FINAL JUDGMENT RENDERED AGAINST AGENT. Cumulative of the foregoing, each
Participant agrees to reimburse Agent promptly upon demand for such
Participant's Percentage share of any costs and expenses to be paid to Agent by
Extreme hereunder to the extent that Agent is not timely reimbursed by Extreme
as provided in subsection 7.2.8. As used in this Section the term "Agent" shall
refer not only to the Person designated as such in the introductory paragraph of
this Agreement, but also to each director, officer, agent, attorney, employee,
representative and Affiliate of such Person.

         Section 11.5 Agent's Rights as Participant and Deposit Taker. In its
                      -----------------------------------------------
capacity as a Participant, BNP PARIBAS shall have the same rights and
obligations as any Participant and may exercise such rights as though it were
not Agent. In its capacity as a Deposit Taker, BNP PARIBAS shall have the same
rights and obligations as any Deposit Taker and may exercise such rights as
though it were not Agent. BNP PARIBAS and any of its Affiliates may accept
deposits from, lend money to, act as Trustee under indentures of, and generally
engage in any kind of business with Extreme or its Affiliates, all as if BNP
PARIBAS were not designated as the Agent hereunder and without any duty to
account therefor to any other Participant.

         Section 11.6 Investments. Whenever Agent in good faith determines that
                      -----------
it is uncertain about how to distribute any funds which it has received
hereunder, or whenever Agent in good faith determines that there is any dispute
among BNPLC and Participants about how such funds should be distributed, Agent
may choose to defer distribution of the funds which are the subject of such
uncertainty or dispute. If Agent in good faith believes that the uncertainty or
dispute will not be promptly resolved, or if Agent is otherwise required to
invest funds pending distribution, Agent shall invest such funds pending
distribution, all interest on any such investment shall be distributed upon the
distribution of such investment and in the same proportion and to the same
Persons as such investment. All moneys received by Agent for distribution to
BNPLC or Participants shall be held by Agent pending such distribution solely as
Agent hereunder, and Agent shall have no equitable title to any portion thereof.

         Section 11.7 Benefit of Article XI. The provisions of this Article
                      ---------------------
(other than the following Section 11.8) are intended solely for the benefit of
Agent, BNPLC and Participants, and Extreme shall not be entitled to rely on any
such provision or assert any such provision in a claim or defense against Agent,
BNPLC or any Participant. Agent, BNPLC and Participants may waive or amend such
provisions as they desire without any notice to or consent of Extreme.

         Section 11.8 Resignation. Agent may resign at any time by giving
                      -----------
written notice thereof to BNPLC, Participants and Extreme. Upon any such
resignation the Majority (as defined in the Participation Agreement) shall have
the right to appoint a successor Agent, subject to Extreme's consent, such
consent not to be unreasonably withheld. A successor must be appointed for any
retiring Agent, and such Agent's resignation shall become effective when such
successor accepts such appointment. If, within thirty days after the date of the
retiring Agent's resignation, no successor Agent has been appointed and has
accepted such appointment, then the retiring Agent may appoint a successor
Agent, which shall be a commercial bank organized or licensed to conduct a
banking or trust business under the laws of the United States of America or of
any state thereof. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation
hereunder, the provisions of this Article 10.1 shall continue to inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent.

                                     -19-
<PAGE>

                          ARTICLE XII   MISCELLANEOUS

         Section 12.1 Provisions Incorporated From Other Operative Documents.
                      ------------------------------------------------------
Reference is made to the Common Definitions and Provisions Agreement
(Improvements), to the Purchase Agreement and to the Participation Agreement for
a statement of the terms thereof. Without limiting the generality of the
foregoing, the provisions of Article II of the Common Definitions and Provisions
Agreement (Improvements) are incorporated into this Agreement for all purposes
as if set forth in this Article.

         Section 12.2 Cumulative Rights, etc. Except as herein expressly
                      ----------------------
provided to the contrary, the rights, powers and remedies of Agent, BNPLC and
the Participants under this Agreement shall be in addition to all rights, powers
and remedies given to them by virtue of any Applicable Law, any other
Transaction Document or any other agreement, all of which rights, powers, and
remedies shall be cumulative and may be exercised successively or concurrently
without impairing their respective rights hereunder. Extreme waives any right to
require Agent, BNPLC or any Participant to proceed against any Person or to
exhaust any Collateral or to pursue any remedy in Agent's, BNPLC's or such
Participant's power.

         Section 12.3 Survival of Agreements. All representations and warranties
                      ----------------------
of Extreme herein, and all covenants and agreements herein shall survive the
execution and delivery of this Agreement, the execution and delivery of any
other Transaction Documents and the creation of the Secured Obligations and
continue until terminated or released as provided herein.

         Section 12.4 Other Liable Party. Neither this Agreement nor the
                      ------------------
exercise by Agent or the failure of Agent to exercise any right, power or remedy
conferred herein or by law shall be construed as relieving any Other Liable
Party from liability on the Secured Obligations or any deficiency thereon. This
Agreement shall continue irrespective of the fact that the liability of any
Other Liable Party may have ceased or irrespective of the validity or
enforceability of any other agreement evidencing or securing the Secured
Obligations to which Extreme or any Other Liable Party may be a party, and
notwithstanding the reorganization, death, incapacity or bankruptcy of any Other
Liable Party, or any other event or proceeding affecting any Other Liable Party.

         Section 12.5 Termination. Following the Designated Sale Date, upon
                      -----------
satisfaction in full of all Secured Obligations and upon written request for the
termination hereof delivered by Extreme to Agent, (i) this Agreement and the
pledge and security interest created hereby shall terminate and all rights to
the Collateral shall revert to Extreme and (ii) Agent will, upon Extreme's
request and at Extreme's expense execute and deliver to Extreme such documents
as Extreme shall reasonably request to evidence such termination and release.


                         [The signature pages follow.]

                                     -20-
<PAGE>

         IN WITNESS WHEREOF, Extreme, BNPLC, Agent and the Participants whose
signatures appear below have caused this Agreement to be executed as of June 1,
2000.


                                    "Extreme"

                                    EXTREME NETWORKS, INC.


                                    By:_______________________________
                                       Name:__________________________
                                       Title:_________________________
<PAGE>

[Continuation of signature pages to Pledge Agreement (Improvements) dated to be
effective June 1, 2000]



                                       "BNPLC"

                                       BNP LEASING CORPORATION


                                       By:___________________________
                                          Lloyd G. Cox, Vice President
<PAGE>

[Continuation of signature pages to Pledge Agreement (Improvements) dated to be
effective June 1, 2000]


                                       "AGENT"

                                       BNP PARIBAS


                                       By:_______________________________
                                          Name:__________________________
                                          Title:_________________________





                                       "PARTICIPANT"

                                       BNP PARIBAS


                                       By:_______________________________
                                          Name:__________________________
                                          Title:_________________________
<PAGE>

                                 ATTACHMENT 1
                              TO PLEDGE AGREEMENT
                              -------------------

                            CERTIFICATE OF DEPOSIT
                            ----------------------

                                (No. _________)

                              [_________, _____]


[NAME OF THE ISSUING
DEPOSIT TAKER AND THE
ADDRESS OF ITS APPLICABLE
ACCOUNT OFFICE]



Payable to
the order of:   BNP PARIBAS, as Agent under the Pledge Agreement (Improvements)
                dated June 1, 2000, among Extreme Networks, Inc., BNP Leasing
                Corporation, BNP PARIBAS and any other financial institutions
                which are from time to time Participants under such Pledge
                Agreement (Improvements) and BNP PARIBAS, acting in its capacity
                as agent for BNPLC and the Participants

                                                                         Dollars
--------------------------------------------------------------------------------
in current funds, without interest, seven days after presentment of this
certificate properly endorsed.

The bank issuing this certificate acknowledges and certifies that on the date
indicated above the payee deposited the dollar amount indicated above, and that
such amount shall be payable as provided above.


                                   ___________________________________
                                       Authorized Signature
<PAGE>

                                 ATTACHMENT 2
                              TO PLEDGE AGREEMENT
                              -------------------

                        SUPPLEMENT TO PLEDGE AGREEMENT
                        ------------------------------

                              [__________, ____]

BNP PARIBAS
____________________
____________________
____________________


Extreme Networks, Inc.
____________________
____________________
____________________


1.   Reference is made to the Pledge Agreement (Improvements) (the "Pledge
Agreement") dated June 1, 2000 among Extreme Networks, Inc. ("Extreme"), BNP
Leasing Corporation ("BNPLC"), BNP PARIBAS and any other financial institutions
which are from time to time Participants under such Pledge Agreement
(collectively, the "Participants") and BNP PARIBAS, acting in its capacity as
agent for BNPLC and the Participants (in such capacity, "Agent"). Unless
otherwise defined herein, all capitalized terms used in this Supplement have the
respective meanings given to those terms in the Pledge Agreement.

2.   The undersigned hereby certifies to Agent and Extreme that the undersigned
has become a party to the Participation Agreement by executing a supplement as
provided therein and that its Percentage thereunder is ______%.

3.   The undersigned, by executing and delivering this Supplement to Extreme and
Agent, hereby agrees to become a party to the Pledge Agreement and agrees to be
bound by all of the terms thereof applicable to Participants. The Deposit Taker
for the undersigned shall be _________________, until such time as another
Deposit Taker for the undersigned shall be designated in accordance with
Sections 4.4 or 4.5 of the Pledge Agreement. The undersigned certifies to Agent
and Extreme that such Deposit Taker is an Initially Qualified Deposit Taker and
satisfies the requirements for a Deposit Taker set forth in Section 4.1 of the
Pledge Agreement.

IN WITNESS WHEREOF, the undersigned has executed this Supplement as of the day
and year indicated above.

                                       [______________________________________]



                                       By:____________________________________
                                          Name:_______________________________
                                          Title:______________________________
<PAGE>

                                 ATTACHMENT 3
                              TO PLEDGE AGREEMENT
                              -------------------

       NOTICE OF EXTREME'S ELECTION TO CHANGE THE COLLATERAL PERCENTAGE
       ----------------------------------------------------------------

                              [_________, _____]



BNP PARIBAS
[address of BNP]


Re:  Pledge Agreement (Improvements) (the "Pledge Agreement") dated June 1, 2000
--           among Extreme Networks, Inc., BNP Leasing Corporation, BNP PARIBAS
             and any other financial institutions which are from time to time
             Participants under such Pledge Agreement and BNP PARIBAS, acting in
             its capacity as agent for BNPLC and the Participants

Gentlemen:

Capitalized terms used in this letter are intended to have the meanings assigned
to them in the Pledge Agreement referenced above. This letter constitutes notice
to you, as Agent under the Pledge Agreement, that pursuant to Section 3.1 of the
Pledge Agreement, Extreme elects to change the Collateral Percentage to:

                          __________ percent (___%),

on the following Base Rent Date (which will be the first day of a new Base Rent
Period):

                               __________, ____

Extreme expects that multiplying the new Collateral Percentage specified above
against Stipulated Loss Value of:

              ____________________________ Dollars ($__________),

will result in an expected new Minimum Collateral Value of:

              ____________________________ Dollars ($__________).


[NOTE: THE NEXT PARAGRAPH WILL BE INCLUDED ONLY IN A NOTICE OF AN INCREASE IN
 -----                                                            --------
THE COLLATERAL PERCENTAGE, BECAUSE OF WHICH EXTREME WILL BE REQUIRED TO DELIVER
ADDITIONAL CASH COLLATERAL TO SATISFY THE MINIMUM COLLATERAL VALUE REQUIREMENTS
IN SECTION 5.1 OF THE PLEDGE AGREEMENT:

Because of the increase in the Collateral Percentage which will result from this
notice and the corresponding increase in the Minimum Collateral Value, Extreme
will deliver additional Cash Collateral to you as required by Section 5.1 of the
Pledge Agreement no later than 12:00 noon (San Francisco time) on the Base Rent
Date specified above, in the amount of:
<PAGE>

             ____________________________ Dollars ($__________).]

To assure you that Extreme has satisfied the conditions to its right to change
the Collateral Percentage as provided in this notice, and to induce you to rely
upon this notice in discharging your responsibilities under the Pledge
Agreement, Extreme certifies to you that:

     1.   Extreme is giving this notice to you, BNPLC and the Participants at
least ten Business Days prior to the Base Rent Date specified above, and such
Base Rent Date is the commencement of a Base Rent Period.

     2.   No Event of Default or other event or circumstance that would,
pursuant to Section 3.2 of the Pledge Agreement, preclude Extreme from
designating the new Collateral Percentage above has occurred and is continuing,
and Extreme does not anticipate that on the Base Rent Date specified above there
will have occurred and be continuing any such Event of Default or other event or
circumstance.

     3.   The new Collateral Percentage specified by Extreme above is not less
than the Minimum Collateral Percentage currently in effect.

NOTE: YOU SHALL BE ENTITLED TO DISREGARD THIS NOTICE IF THE STATEMENTS ABOVE ARE
-----
NOT CORRECT. HOWEVER, WE ASK THAT YOU NOTIFY EXTREME IMMEDIATELY IF FOR ANY
REASON YOU BELIEVE THIS NOTICE IS DEFECTIVE.


                                       EXTREME NETWORKS, INC.


                                       By:____________________________________
                                          Name:_______________________________
                                          Title:______________________________

[cc BNPLC and all Participants]

                                      -2-
<PAGE>

                                 ATTACHMENT 4
                              TO PLEDGE AGREEMENT
                              -------------------

                          NOTICE OF SECURITY INTEREST
                          ---------------------------

                              [_________, _____]

[Name of Deposit Taker]
[Address of Deposit Taker]

1. Reference is made to the Pledge Agreement (Improvements) (the "Pledge
Agreement") dated June 1, 2000 among Extreme Networks, Inc. ("Extreme"), BNP
Leasing Corporation ("BNPLC"), BNP PARIBAS and any other financial institutions
which are from time to time Participants under such Pledge Agreement
(collectively, the "Participants") and BNP PARIBAS, acting in its capacity as
agent for BNPLC and the Participants (in such capacity, "Agent"). Unless
otherwise defined herein, all capitalized terms used in this Notice have the
respective meanings given to those terms in the Pledge Agreement.

2. Extreme has informed Agent that Extreme has established with the addressee
of this Notice (the "Deposit Taker") the following non-interest bearing
Account(s) to be maintained at the following Account Office(s):

  Account                Account          Account
   Type                   Office          Number
   ----                   ------          ------

Time Deposit           _________            _________
Time Deposit           _________            _________
Time Deposit           _________            _________

Extreme has further informed Agent that Extreme intends to maintain Cash
Collateral in such Account(s), and that to evidence such Account(s) and the
amount of Cash Collateral held therein from time to time, Extreme has authorized
the Deposit Taker to issue Certificates of Deposit payable to the order of Agent
as provided in the Pledge Agreement.

     3.   Extreme and Agent hereby notify Deposit Taker that, pursuant to the
Pledge Agreement, Extreme has granted to Agent, for the ratable benefit of BNPLC
and the Participants as security for the Secured Obligations, a pledge of and
security interest in all Accounts and other Collateral maintained by Extreme
with Deposit Taker, including the Account(s) described in Section 2 above.

     4.   In furtherance of such grant, Extreme and Agent hereby authorize and
direct Deposit Taker to:

          (a)  hold all Collateral for Agent and as Agent's bailee, separate and
     apart from all other property and funds of Extreme and all other Persons
     and to permit no other funds to be deposited or credited to the Account(s);
<PAGE>

          (b)  make a notation in its books and records of the interest of Agent
     in the Collateral and that the Account(s) and all deposits therein or sums
     credited thereto are subject to a pledge and security interest in favor of
     Agent;

          (c)  issue and redeem Certificates of Deposit evidencing the
     Account(s), as directed by Agent pursuant to the Pledge Agreement;

          (d)  take such other steps as Agent may reasonably request to record,
     maintain, validate and perfect its pledge of and security interest in

          (e)  upon receipt of notice from Agent that an Event of Default has
     occurred, transfer and deliver to Agent or its nominee, together with all
     necessary endorsements, all or such portion of the Collateral held by
     Deposit Taker as Agent shall direct; provided, however, that in connection
     therewith the Deposit Taker may require compliance by Agent with the
     provisions in Section 5.4 of the Pledge Agreement for redemption of any
     outstanding Certificates of Deposit which evidence the Account(s).

     5.   Extreme and Agent agree that (a) the possession by Deposit Taker of
all money, instruments, chattel paper and other property constituting Collateral
shall be deemed to be possession by Agent or a person designated by Agent, for
purposes of perfecting the security interest granted to Agent hereunder pursuant
to Section 9305, 8313 or 8213 of the UCC (as the case may be), and (b)
   --------------------------
notifications by Deposit Taker to other Persons holding any such property, and
Acknowledgments, receipts or confirmations from such Persons delivered to
Deposit Taker, shall be deemed notifications to, or Acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Deposit Taker for the benefit of Agent for the purposes of perfecting
such security interests under applicable law.

     6.   As contemplated by the Pledge Agreement, please acknowledge Deposit
Taker's receipt of, and consent to, this notice and confirm the representations
and agreements set forth in the Acknowledgment and Agreement attached hereto by
executing the same and returning this letter to Agent. For your files, a copy of
this letter is enclosed which you may retain. The authorizations and directions
set forth herein may not be revoked or modified without the written consent of
Agent.

                                    "AGENT"

                                    BNP PARIBAS


                                    By:________________________
                                       Name:___________________
                                       Title:__________________

                                    "EXTREME"

                                    EXTREME NETWORKS, INC.


                                    By:________________________
                                       Name:___________________
                                       Title:__________________

                                      -2-
<PAGE>

                         ACKNOWLEDGMENT AND AGREEMENT
                               OF DEPOSIT TAKER


     Deposit Taker hereby acknowledges receipt of, and consents to, the above
notice, acknowledges that it will hold the Collateral for Agent and as Agent's
bailee, agrees to comply with the authorizations and directions set forth above
and represents to and agrees with Extreme and Agent as follows:

          (a)  Deposit Taker is a commercial bank, organized under the laws of
     the United States of America or a state thereof or under the laws of
     another country which is doing business in the United States of America.
     Deposit Taker is authorized to maintain deposit accounts for others through
     the Account Offices specified in the above notice, and Deposit Taker will
     not move the accounts described in the above notice to other offices
     without the prior written authorization of Agent and Extreme.

          (b)  Deposit Taker has a combined capital, surplus and undivided
     profits of at least $500,000,000.

          (c)  The information set forth above regarding the Account(s) is
     accurate. Such Account(s) is (are) currently open and Deposit Taker has no
     prior notice of any other pledge, security interest, Lien, adverse claim or
     interest in such Account(s).

          (d)  Deposit Taker shall promptly notify Extreme and Agent if the
     representations made by Deposit Taker above cease to be true and correct.

          (e)  Deposit Taker shall not (i) allow the withdrawal of funds from
     any Account by any Person other than Agent, or (ii) without in each case
                                                         --------------------
     first obtaining the prior written authorization of Agent, setoff or attempt
     --------------------------------------------------------
     to setoff any Secured Obligations owed to Deposit Taker against any
     Collateral held from time to time by Deposit Taker, or (iii) without in
                                                                  ----------
     each case first obtaining the prior written authorization of both Extreme
     -------------------------------------------------------------------------
     and Agent, setoff or attempt to setoff any obligations owed to Deposit
     ---------
     Taker other than Secured Obligations, against any Collateral held from time
     to time by Deposit Taker.

                                              [________________________________]


                                              By:_____________________________
                                                     Name:____________________
                                                     Title:___________________

                                              [Date]
<PAGE>

                                 ATTACHMENT 5
                              TO PLEDGE AGREEMENT
                              -------------------

                       EXAMPLES OF CALCULATIONS REQUIRED
                       ---------------------------------
                        TO AVOID A COLLATERAL IMBALANCE
                        -------------------------------

     The examples below are provided to illustrate the calculations required for
allocations of Cash Collateral in a manner that will avoid a Collateral
Imbalance. The examples are not intended to reflect actual numbers under this
Agreement or actual Percentages of BNPLC or any of the Participants; nor are the
examples intended to provide a formula for the allocations that would be
appropriate in every case. The examples also reflect adjustments that would be
appropriate if the Collateral Percentage were adjusted from time to time from
and after the Effective Date.

                                 EXAMPLE NO. 1

Assumptions:
-----------

1.   Two Participants ("Participant A" and "Participant B") are parties to the
     Participation Agreement with BNPLC. Participant A's Percentage is 50% and
     Participant B's Percentage is 45%, leaving BNPLC with a Percentage of 5%.

2.   On the Effective Date, the Initial Funding Advance was $12,000,000,
     resulting in a Stipulated Loss Value of $12,000,000, allocable as follows:

     A.   BNPLC's Parent (providing BNPLC's share) (5%)...........  $   600,000
     B.   Participant A (50%).....................................    6,000,000
     C.   Participant B (45%).....................................    5,400,000
                                                                    -----------

          TOTAL...................................................  $12,000,000

3.   The Minimum Collateral Value on the Effective Date was $7,200,000
     (reflecting a Collateral Percentage of 60% times Stipulated Loss Value).

4.   On the Effective Date, Extreme had delivered to Agent Cash Collateral of
     $7,200,000, equal to the Minimum Collateral Value, as required by Section
     5.1 of this Agreement.

Allocation of Cash Collateral Required: To avoid a Collateral Imbalance under
--------------------------------------
these assumptions, Agent would be required to allocate the $7,200,000 to the
Deposit Takers for BNPLC and the Participants as follows:

<TABLE>
     <S>                                                                                 <C>
     A.   BNPLC's Deposit Taker (5% of Minimum Collateral Value)........................ $  360,000
     B.   Participant A's Deposit Taker (50% of Minimum Collateral Value)...............  3,600,000
     C.   Participant B's  Deposit Taker (45% of Minimum Collateral Value)..............  3,240,000
                                                                                         ----------

          TOTAL..........................................................................$7,200,000
</TABLE>

                                 EXAMPLE NO. 2

Assumptions:  Assume the same facts as in Example No. 1, and in addition assume
-----------
that:

1.   Effective as of the first Base Rent Date, Extreme increased its
     Collateral Percentage from 60% to
<PAGE>

     80%, raising the Minimum Collateral Value to $9,600,000. Because of such
     increase, Extreme also delivered an additional $2,400,000 as Cash
     Collateral to Agent on the first Base Rent Date, bringing the total of all
     Cash Collateral delivered by Extreme to $9,600,000 as required by Section
     5.1 of this Agreement.

2.   Also effective as of the first Base Rent Date, a new Participant approved
     by Extreme ("Participant C") became a party to this Agreement and the
     Participation Agreement, taking a Percentage of 20%. Simultaneously,
     Participant A and Participant B entered into supplements to the
     Participation Agreement which reduced their Percentages to 40% and 35%,
     respectively.

Allocation of Cash Collateral Required: To avoid a Collateral Imbalance under
--------------------------------------
these assumptions, Agent would be required to allocate the Cash Collateral as
required to leave the Deposit Takers for BNPLC and the Participants with the
following amounts:

<TABLE>
     <S>                                                                       <C>
     A.   BNPLC's Deposit Taker (5% of Minimum Collateral Value).............. $  480,000
     B.   Participant A's Deposit Taker (40% of Minimum Collateral Value).....  3,840,000
     C.   Participant B's Deposit Taker (35% of Minimum Collateral Value).....  3,360,000
     D.   Participant C's  Deposit Taker (20% of Minimum Collateral Value)....  1,920,000
                                                                               ----------

          TOTAL............................................................... $9,600,000
</TABLE>

Thus, to prevent a Collateral Imbalance, Agent would have to allocate the
$2,400,000 of additional Cash Collateral it received on the first Base Rent Date
as follows:

<TABLE>
     <S>                                                                                         <C>
     A.   BNPLC's Deposit Taker ($480,000 less $360,000 already on deposit) .................... $  120,000
     B.   Participant A's Deposit Taker ($3,840,000 less $3,600,000 already on deposit).........    240,000
     C.   Participant B's Deposit Taker ($3,360,000 less $3,240,000 already on deposit).........    120,000
     D.   Participant C's  Deposit Taker ($1,920,000 less $0 already on deposit)................  1,920,000
                                                                                                 ----------

          TOTAL................................................................................. $2,400,000
</TABLE>

                                 EXAMPLE NO. 3

Assumptions:  Assume the same facts as in Example No. 2, except that:
-----------                                              -----------

1.   Instead of increasing its Collateral Percentage from 60% to 80%, Extreme
     increased its Collateral Percentage to 70% on the first Base Rent Date,
     raising the Minimum Collateral Value to $8,400,000. Because of such
     increase, Extreme delivered an additional $1,200,000 as additional Cash
     Collateral to Agent on the first Base Rent Date, bringing the total of all
     Cash Collateral delivered by Extreme to $8,400,000 as required by Section
     5.1 of this Agreement.

Allocation of Cash Collateral Required: To avoid a Collateral Imbalance under
--------------------------------------
these assumptions, Agent would be required to allocate the Cash Collateral as
required to leave the Deposit Takers for BNPLC and the Participants with the
following amounts:

<TABLE>
     <S>                                                                                         <C>
     A.   BNPLC's Deposit Taker (5% of Minimum Collateral Value)..............................   $  420,000
     B.   Participant A's Deposit Taker (40% of Minimum Collateral Value).....................    3,360,000
     C.   Participant B's Deposit Taker (35% of Minimum Collateral Value).....................    2,940,000
     D.   Participant C's  Deposit Taker (20% of Minimum Collateral Value)....................    1,680,000
                                                                                                 ----------

          TOTAL...............................................................................   $8,400,000
</TABLE>

                                      -2-
<PAGE>

<TABLE>
          <S>                                                                                   <C>
          TOTAL...............................................................................  $8,400,000
</TABLE>

Thus, to prevent a Collateral Imbalance, Agent would have to allocate the
$1,200,000 of additional Cash Collateral it received on the first Base Rent Date
as follows:

<TABLE>
     <S>                                                                                        <C>
     A.   BNPLC's Deposit Taker ($420,000 less $360,000 already on deposit) ..................  $   60,000
     B.   Participant A's Deposit Taker ($3,360,000 less
          $3,600,000 already on deposit)......................................................    (240,000)
     C.   Participant B's Deposit Taker ($2,940,000 less
          $3,240,000 already on deposit)......................................................    (300,000)
     D.   Participant C's  Deposit Taker ($1,680,000 less $0 already on deposit)..............   1,680,000
                                                                                                ----------

          TOTAL...............................................................................  $1,200,000
</TABLE>

NOTE: THE NEGATIVE AMOUNTS (IN PARENTHESIS) ABOVE REPRESENT REQUIRED WITHDRAWALS
-----                                                                -----------
RATHER THAN DEPOSITS. AS EXAMPLE NO. 3 ILLUSTRATES, TO AVOID A COLLATERAL
IMBALANCE AGENT MAY FROM TIME TO TIME HAVE TO WITHDRAW CASH COLLATERAL HELD BY
THE DEPOSIT TAKER FOR ONE PARTICIPANT AND DEPOSIT IT IN AN ACCOUNT MAINTAINED BY
A DEPOSIT TAKER FOR ANOTHER PARTICIPANT.

                                      -3-
<PAGE>

                                 ATTACHMENT 6
                              TO PLEDGE AGREEMENT
                              -------------------

                      NOTICE OF EXTREME'S REQUIREMENT TO
                      ----------------------------------
                        WITHDRAW EXCESS CASH COLLATERAL
                        -------------------------------


                               [________,_____]


BNP PARIBAS
[address of BNP]

     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice to you, as Agent under the
Pledge Agreement, that pursuant to Section 6.1 of the Pledge Agreement, Extreme
requires you to withdraw from the Accounts and return to Extreme the following
amount:

              ____________________________ Dollars ($__________)

on the following date:

                               __________, ____


     To assure you that Extreme has satisfied the conditions to its right to
require such withdrawal, and to induce you to comply with this notice, Extreme
certifies to you that:

          1.   Your withdrawal and delivery of the amount specified above to
     Extreme will not cause the Value of the remaining Collateral to be less
     than the Minimum Collateral Value. After giving effect to such withdrawal,
     the Collateral remaining in the Accounts maintained by the Deposit Takers
     will be:

              ____________________________ Dollars ($__________),
<PAGE>

and the Minimum Collateral Value on the date specified above will equal:


              ____________________________ Dollars ($__________).


Such Minimum Collateral Value equals the Collateral Percentage of:


                          __________ percent (___%),


times the Stipulated Loss Value of:


              ____________________________ Dollars ($__________).


     2.   Extreme is giving this notice to you, BNPLC and the Participants at
least ten days prior to the date specified above.

     3.   No Default or Event of Default has occurred and is continuing as of
the date of this notice, and Extreme does not anticipate that any Default or
Event of Default will have occurred and be continuing on the date upon which the
withdrawal is required.

     4.   Extreme agrees that you may determine the Accounts from which to make
any withdrawal required by Extreme pursuant to this Section as necessary to
prevent or mitigate any Collateral Imbalance.

NOTE: YOU SHALL BE ENTITLED TO DISREGARD THIS NOTICE IF THE STATEMENTS ABOVE ARE
-----
NOT CORRECT OR IF THE DATE FOR WITHDRAWAL SPECIFIED ABOVE IS LESS THAN TEN DAYS
AFTER YOUR RECEIPT OF THIS NOTICE. HOWEVER, WE ASK THAT YOU NOTIFY EXTREME
IMMEDIATELY IF FOR ANY REASON YOU BELIEVE THIS NOTICE IS DEFECTIVE.

                                      -2-
<PAGE>

     Please remember that the express terms of Certificates of Deposit issued
pursuant to the Pledge Agreement require presentment of the Certificates of
Deposit seven days before Cash Collateral is to be withdrawn from the Accounts
they evidence. Accordingly, you must present Certificates of Deposit to Deposit
Takers seven days prior to the withdrawal of Cash Collateral required by this
notice. For your convenience, we have attached a letter as Annex 1 to this
                                                           -------
notice that you might execute and send to Deposit Takers to advise them of your
intent to withdraw and of your presentment of Certificates of Deposit as
required in connection therewith. The attached letter also sets forth the
amounts Extreme believes you must withdraw from each Account to avoid a
Collateral Imbalance.

                                   EXTREME NETWORKS, INC.

                                   By:_______________________
                                        Name:________________
                                        Title:_______________

[cc BNPLC and all Participants]

                                      -3-
<PAGE>

                                    Annex 1
                                    -------
                     TO EXTREME'S NOTICE OF REQUIREMENT TO
                        WITHDRAW CASH EXCESS COLLATERAL

                              [_________, _____]

Deposit Takers on the
Attached Distribution List

     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice from the undersigned, as
Agent under the Pledge Agreement, that pursuant to Section 6.1 of the Pledge
Agreement, Extreme requires Agent to withdraw from the Accounts and return to
Extreme the amounts listed below on the following date:

                               __________, ____

     Accordingly, on such date, the undersigned intends to withdraw the
following amounts from the following Accounts, and with this letter the
undersigned is presenting Certificates of Deposit as required in connection with
such withdrawal:

Deposit Taker                Account No.                 Amount


1.__________________       ____________________           $______________

2.__________________       ____________________           $______________

3.__________________       ____________________           $______________

4.__________________       ____________________           $______________

                           TOTAL WITHDRAWALS:             $==============


                                    BNP PARIBAS, AS AGENT

                                    By:________________________
                                         Name:_________________
                                         Title:________________

[cc BNPLC and Extreme]

                                      -4-
<PAGE>

                                 ATTACHMENT 7
                              TO PLEDGE AGREEMENT
                              -------------------

                      NOTICE OF EXTREME'S REQUIREMENT OF
                      ----------------------------------
                        DIRECT PAYMENTS TO PARTICIPANTS
                        -------------------------------



                              [_________, _____]


BNP PARIBAS
[address of BNP]


     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice to you, as Agent under the
Pledge Agreement, that pursuant to Section 6.2 of the Pledge Agreement, Extreme
requires you to withdraw from the Accounts and pay directly to the Participants
(in proportion to their respective Percentages) the following amount:

               ____________________________ Dollars ($__________)

on the following date (which, Extreme acknowledges, must be the Designated Sale
Date or a date thereafter prior to an Event of Default):


                               __________, ____

     The amount specified above equals the following percentage (equal to the
aggregate of all Participant's Percentages):


                          __________ percent (___%),


times the total of all Cash Collateral presently pledged under the Pledge
Agreement:


               ____________________________ Dollars ($__________).
<PAGE>

     To assure you that Extreme has satisfied the conditions to its right to
require such withdrawal, and to induce you to comply with this notice, Extreme
certifies to you that Extreme is giving this notice to you, BNPLC and the
Participants at least ten days prior to the date of required withdrawal and
payment specified above.

     Please remember that the express terms of Certificates of Deposit issued
pursuant to the Pledge Agreement require presentment of the Certificates of
Deposit seven days before Cash Collateral is to be withdrawn from the Accounts
they evidence. Accordingly, you must present Certificates of Deposit to Deposit
Takers seven days prior to the withdrawal of Cash Collateral required by this
notice. For your convenience, we have attached a letter as Annex 1 to this
                                                           -------
notice that you might execute and send to Deposit Takers to advise them of your
intent to withdraw and of your presentment of Certificates of Deposit as
required in connection therewith. The attached letter also sets forth the
amounts Extreme believes you must withdraw from each Account to comply with
subsection 6.2.2 of the Pledge Agreement.

                                                EXTREME NETWORKS, INC.

                                                By:____________________________
                                                      Name:____________________
                                                      Title:___________________
[cc BNPLC and all Participants]

                                      -2-
<PAGE>

                                    Annex 1
                                    -------
                     TO EXTREME'S NOTICE OF REQUIREMENT TO
                     -------------------------------------
                         WITHDRAW CASH COLLATERAL FOR
                         ----------------------------
                        DIRECT PAYMENTS TO PARTICIPANTS
                        -------------------------------
                              [---------, -----]

Deposit Takers on the
Attached Distribution List

     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice from the undersigned, as
Agent under the Pledge Agreement, that pursuant to Section 6.2 of the Pledge
Agreement, Extreme requires Agent to withdraw from the Accounts and pay to the
Participants (in proportion to their respective Percentages) the amounts listed
below on the following date:

                               __________, ____

     Accordingly, on such date, the undersigned intends to withdraw the
following amounts from the following Accounts, and with this letter the
undersigned is presenting Certificates of Deposit as required in connection with
such withdrawal:

 Deposit Taker               Account No.                 Amount

1._______________________   ______________________  $_________________________

2._______________________   ______________________  $_________________________

3._______________________   ______________________  $_________________________

4._______________________   ______________________  $_________________________


                             TOTAL WITHDRAWALS:     $_________________________


                                  BNP PARIBAS, AS AGENT

                                  By:_________________________________________
                                         Name:________________________________
                                         Title:_______________________________

[cc BNPLC and Extreme]

                                      -3-
<PAGE>

                                 ATTACHMENT 8
                              TO PLEDGE AGREEMENT
                              -------------------

                      NOTICE OF EXTREME'S REQUIREMENT OF
                      ----------------------------------
                            DIRECT PAYMENT TO BNPLC
                            -----------------------
                              [_________, _____]

BNP PARIBAS
[address of BNP]

     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice to you, as Agent under the
Pledge Agreement, that pursuant to Section 6.3 of the Pledge Agreement, Extreme
requires you to withdraw from the Account maintained by the Deposit Taker for
BNPLC and pay directly to BNPLC on behalf of Extreme as a payment required by
the Purchase Agreement the following amount:

              ____________________________ Dollars ($__________)

on the following date (which, Extreme acknowledges, must be the Designated Sale
Date or a date thereafter prior to an Event of Default):

                               __________, ____

     To assure you that Extreme has satisfied the conditions to its right to
require such withdrawal, and to induce you to comply with this notice, Extreme
certifies to you that Extreme is giving this notice to you and BNPLC at least
ten days prior to the date of required withdrawal and payment specified above.

     Please remember that the express terms of Certificates of Deposit issued
pursuant to the Pledge Agreement require presentment of the Certificates of
Deposit seven days before Cash Collateral is to be withdrawn from the Accounts
they evidence. Accordingly, you must present Certificates of Deposit to the
Deposit Taker for BNPLC seven days prior to the withdrawal of Cash Collateral
required by this notice. For your convenience, we have attached a letter as
Annex 1 to this notice that you might execute and send to the Deposit Taker for
-------
BNPLC to advise it of your intent to withdraw and of your presentment of
Certificates of Deposit as required in connection therewith. The attached letter
also sets forth the amount Extreme believes you must withdraw to comply with
Section 6.3 of the Pledge Agreement.

                                       EXTREME NETWORKS, INC.

                                       By:____________________________________
                                            Name:_____________________________
                                            Title:____________________________

[cc BNPLC]
<PAGE>

                                    Annex 1
                                    -------
                     TO EXTREME'S NOTICE OF REQUIREMENT OF
                     -------------------------------------
                            DIRECT PAYMENT TO BNPLC
                            -----------------------

                              [_________, _____]


[Name of the Deposit Taker for BNPLC]
[Address of such Deposit Taker]

     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice from the undersigned, as
Agent under the Pledge Agreement, that pursuant to Section 6.3 of the Pledge
Agreement, Extreme requires Agent to withdraw from the Account maintained by
you, as Deposit Taker for BNPLC, the sum of:

              ____________________________ Dollars ($__________)


and pay the same to BNPLC as a payment required by the Purchase Agreement on the
following date:

                               __________, ____


     Accordingly, on such date, the undersigned intends to withdraw such amount
from the following Account maintained by you as Deposit Taker for BNPLC, and
with this letter the undersigned is presenting Certificate(s) of Deposit as
required in connection with such withdrawal.

                                        BNP PARIBAS, AS AGENT

                                        By:   ________________________________
                                              Name:___________________________
                                              Title:__________________________

[cc BNPLC and Extreme]

                                      -2-
<PAGE>

                                 ATTACHMENT 9
                              TO PLEDGE AGREEMENT
                              -------------------

                NOTICE OF EXTREME'S REQUIREMENT OF A WITHDRAWAL
                -----------------------------------------------
                            OF CASH COLLATERAL FROM
                            -----------------------
                         A DISQUALIFIED DEPOSIT TAKER
                         ----------------------------


                              [_________, _____]


BNP PARIBAS
[address of BNP]


     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice to you, as Agent under the
Pledge Agreement, that pursuant to Section 6.4 of the Pledge Agreement, Extreme
requires you to withdraw from the following Account maintained by the following
Deposit Taker:

                   Deposit Taker                         Account No.
                   ----------------------------      --------------------


Cash Collateral in the following amount:

              ____________________________ Dollars ($__________)


and to deposit such Cash Collateral with other Deposit Takers who are not
Disqualified Deposit Takers no later than ten days after the date upon which you
receive this notice.

     To assure you that Extreme has the right to require such withdrawal, and to
induce you to comply with this notice, Extreme certifies to you that the Deposit
Taker specified above has become a Disqualified Deposit Taker because it no
longer satisfies the requirements listed in Section 4.1 of the Pledge Agreement.
Specifically, such Deposit Taker no longer satisfies the following requirements:

[EXTREME MUST INSERT HERE A DESCRIPTION OF WHICH REQUIREMENTS THE DEPOSIT TAKER
NO LONGER SATISFIES AND HOW EXTREME HAS DETERMINED THAT THE REQUIREMENTS ARE NO
LONGER SATISFIED, ALL IN SUFFICIENT DETAIL TO PERMIT THE PARTICIPANT FOR WHOM
SUCH DEPOSIT TAKER HAS BEEN MAINTAINING AN ACCOUNT TO RESPOND IF IT BELIEVES
THAT EXTREME IS IN ERROR.]
<PAGE>

     Please remember that the express terms of Certificates of Deposit issued
pursuant to the Pledge Agreement require presentment of the Certificates of
Deposit seven days before Cash Collateral is to be withdrawn from the Accounts
they evidence. Accordingly, you must present Certificates of Deposit to the
Deposit Taker specified above seven days prior to the withdrawal of Cash
Collateral required by this notice. For your convenience, we have attached a
letter as Annex 1 to this notice that you might execute and send to such Deposit
          -------
Taker to advise it of your intent to withdraw and of your presentment of
Certificates of Deposit as required in connection therewith. The attached letter
also sets forth the amount Extreme believes you must withdraw to comply with
Section 6.4 of the Pledge Agreement.

                                              EXTREME NETWORKS, INC.

                                              By:______________________________
                                                    Name:______________________
                                                    Title:_____________________
[cc BNPLC]

                                      -2-
<PAGE>

                                    Annex 1
                                    -------
              TO EXTREME'S NOTICE OF REQUIREMENT OF A WITHDRAWAL
              --------------------------------------------------
                            OF CASH COLLATERAL FROM
                            -----------------------
                         A DISQUALIFIED DEPOSIT TAKER
                         ----------------------------


                              [_________, _____]


[Name of the Deposit Taker for BNPLC]
[Address of such Deposit Taker]

     Re:  Pledge Agreement (Improvements) dated June 1, 2000 among Extreme
     --
          Networks, Inc., BNP Leasing Corporation, BNP PARIBAS and any other
          financial institutions which are from time to time Participants under
          such Pledge Agreement (Improvements) and BNP PARIBAS, acting in its
          capacity as agent for BNPLC and the Participants

Gentlemen:

     Capitalized terms used in this letter are intended to have the meanings
assigned to them in the Pledge Agreement (Improvements) referenced above (the
"Pledge Agreement"). This letter constitutes notice from the undersigned, as
Agent under the Pledge Agreement, that pursuant to Section 6.4 of the Pledge
Agreement, Extreme has advised Agent that you are a Disqualified Deposit Taker,
and Extreme requires Agent to withdraw from the Account maintained by you, as a
Deposit Taker under the Pledge Agreement, the sum of:

              ____________________________ Dollars ($__________)


no later than the following date:

                               __________, ____


     Accordingly, on such date, the undersigned intends to withdraw such amount
from the Account maintained by you as Deposit Taker (Account No. __________),
and with this letter the undersigned is presenting Certificate(s) of Deposit as
required in connection with such withdrawal.


                                          BNP PARIBAS, AS AGENT

                                          By:   ______________________________
                                                Name:_________________________
                                                Title:________________________

[cc BNPLC and Extreme]

                                      -3-
<PAGE>

                                  Schedule 1
                              TO PLEDGE AGREEMENT
                              -------------------

     [IN PLACE OF THIS PAGE, SUBSTITUTE SCHEDULE 1 ATTACHED TO THE LEASE]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21.1
<SEQUENCE>10
<FILENAME>0010.txt
<DESCRIPTION>SUBSIDIARIES OF REGISTRANT
<TEXT>

<PAGE>

                                                                    EXHIBIT 21.1



                          SUBSIDIARIES OF REGISTRANT
                          --------------------------



NAME                                          LOCATION
----                                          --------


Extreme Networks International                Cayman Islands
Extreme Networks Japan K.K.                   Japan
Extreme Networks Hong Kong Limited            Hong Kong
Extreme Networks IHC, Inc.                    Delaware
Extreme Networks FSC, Inc.                    Barbados
Extreme Networks UK Limited                   United Kingdom
Extreme Networks B.V.                         The Netherlands
Extreme Networks GmbH                         Germany
Extreme Networks Sarl                         France
Extreme Networks Srl                          Italy
Extreme Networks Canada, Inc.                 Canada
Extreme Networks YH                           Korea
IHC Networks AB                               Sweden
Extreme Networks Australia                    Australia
Extreme Networks EMEA                         Dubai
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>11
<FILENAME>0011.txt
<DESCRIPTION>CONSENT OF ERNST & YOUNG, LLP
<TEXT>

<PAGE>

                                                                    EXHIBIT 23.1




              CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 333-83729) pertaining to the Amended 1996 Stock Option Plan, 1999
Employee Stock Purchase Plan and an Individual Stock Option Agreement of Extreme
Networks, Inc. of our report dated July 18, 2000, except for note 9, as to which
the date is August 24, 2000, with respect to the consolidated financial
statements and schedule of Extreme Networks, Inc. included in the Annual Report
(Form 10-K) for the year ended June 30, 2000.


                                                           /s/ Ernst & Young LLP



Palo Alto, California
September 27, 2000
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-27.1
<SEQUENCE>12
<FILENAME>0012.txt
<DESCRIPTION>FINANCIAL DATA SCHEDULE
<TEXT>

<TABLE> <S> <C>

<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000

<S>                             <C>
<PERIOD-TYPE>                   12-MOS
<FISCAL-YEAR-END>                          JUL-02-2000
<PERIOD-START>                             JUL-01-1999
<PERIOD-END>                               JUL-02-2000
<CASH>                                         116,721
<SECURITIES>                                   190,784
<RECEIVABLES>                                   62,233
<ALLOWANCES>                                     1,237
<INVENTORY>                                     23,801
<CURRENT-ASSETS>                               302,484
<PP&E>                                          35,920
<DEPRECIATION>                                   9,170
<TOTAL-ASSETS>                                 515,930
<CURRENT-LIABILITIES>                           96,603
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                           106
<OTHER-SE>                                     418,915
<TOTAL-LIABILITY-AND-EQUITY>                   515,930
<SALES>                                        261,956
<TOTAL-REVENUES>                               261,956
<CGS>                                          126,916
<TOTAL-COSTS>                                  245,702
<OTHER-EXPENSES>                                    33
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                 490
<INCOME-PRETAX>                                 30,369
<INCOME-TAX>                                    10,321
<INCOME-CONTINUING>                             20,048
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    20,048
<EPS-BASIC>                                       0.20
<EPS-DILUTED>                                     0.18


</TABLE>
</TEXT>
</DOCUMENT>
</SUBMISSION>
