ENCORE CAPITAL GROUP INC
MASTER LEASE
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>masterlease.txt
<DESCRIPTION>MASTER LEASE
<TEXT>

                                                                    Exhibit 10.1



                                                                Initials________
American Industrial Real Estate Association 1982
MULTI-TENANT-GROSS



1.   Parties. This Lease, dated, for reference purposes only, September 12, 1994
     , is made by and between  Transcontinental  Realty Investors,  a California
     Business  Trust  (herein  called  "Lessor") and  West  Capital  Financial
     Services Corp., a California Corporation (herein called "Lessee").

2.   Premises, Parking and Common Areas.

2.1  Premises.  Lessor hereby leases to Lessee and Lessee leases from Lessor for
     the term, at the rental,  and upon all of the  conditions set forth herein,
     real  property  situation in the County of San Diego , State of  California
     commonly  known as 5775  Roscoe  Court,  San  Diego,  California  92123 and
     described as an  approximately  32,504 square foot  office/R&D  building as
     shown on the attached Exhibit "A", herein referred to as the "premises", as
     may be  outlined on an Exhibit  attached  hereto,  including  rights to the
     Common Areas as  hereinafter  specified but not including any rights to the
     roof of the  Premises or to any  Building  in the  Industrial  Center.  The
     Premises are a portion of a building, herein referred to as the "Building".
     The Premises,  the Building,  the Common Ares, the land upon which the same
     are located,  along with all other buildings and improvements  thereon, are
     herein collectively referred to as the "Industrial Center".

2.2  Vehicle  Parking.  Lessee  shall be entitled to One  Hundred  Thirty  (130)
     vehicle parking spaces, unreserved and unassigned, on those portions of the
     Common Areas  designated  by Lessor for parking.  Lessee shall not use more
     parking spaces than said number. Said parking spaces shall be used only for
     parking by  vehicles  no larger  than full size  passenger  automobiles  or
     pick-up trucks,  herein called  "Permitted  Size Vehicles".  Vehicles other
     than  Permitted  Size  Vehicles  are  herein   referred  to  as  "Oversized
     Vehicles".  Lessee  shall be entitled to designate  six (6) parking  spaces
     with signs  located on the  Premises  adjacent to the Building for Lessee's
     exclusive  use.  2.2.1Lessee  shall not permit or allow any  vehicles  that
     belong to or are  controlled  by Lessee or Lessee's  employees,  suppliers,
     shippers, customers, or invitees to be loaded, unloaded, or parked in areas
     other that those designated by Lessor for such activities.

2.2.2If Lessee permits or allows any of the prohibited  activities  described in
     paragraph  2.2 of this  Lease,  then Lessor  shall have the right,  without
     notice,  in addition to such other rights and remedies that it may have, to
     remove or tow away the  vehicle  involved  and  charge  the cost to Lessee,
     which cost shall be immediately  payable upon demand by Lessor.  2.3 Common
     Areas -  Definition.  The term  "Common  Areas" is defined as all areas and
     facilities  outside the Premises and without the exterior  boundary line of
     the  Industrial  Center that are provided and designated by the Lessor from
     time to time for the  general  non-exclusive  use of Lessor,  Lessee and of
     other  lessees of the  Industrial  Center and their  respective  employees,
     suppliers,  shippers,  customers and  invitees,  including  parking  areas,
     loading and unloading areas, trash areas,  roadways,  sidewalks,  walkways,
     parkways, driveways and landscaped areas.

2.4  Common Areas  -Lessee's  Rights.  Lessor hereby  grants to Lessee,  for the
     benefit of Lessee and its  employees,  suppliers,  shippers,  customers and
     invitees, during the term of this Lease, the non-exclusive right to use, in
     common with others  entitled  to such use,  the Common  Areas as they exist
     from time to time, subject to any rights,  powers, and privileges  reserved
     by  Lessor  under  the  terms  hereof  or under  the terms of any rules and
     regulations or  restrictions  governing the use of the  Industrial  Center.
     Under no  circumstances  shall the right  herein  granted to use the Common
     Areas be deemed to include the right to store any property,  temporarily or
     permanently,  in the Common Areas. Any such storage shall be permitted only
     by the prior written consent of Lessor or Lessor's  designated agent, which
     consent  may be  revoked at any time.  In the event  that any  unauthorized
     storage shall occur than Lessor shall have the right,  without  notice,  in
     addition to such other rights and remedies  that it may have, to remove the
     property  and charge the cost to  Lessee,  which cost shall be  immediately
     payable upon demand by Lessor.

2.5  Common  Areas  -Rules and  Regulations.  Lessor or such other  person(s) as
     Lessor may appoint shall have the exclusive  control and  management of the
     Common Areas and shall have the right, from to time, to establish,  modify,
     amend and enforce  reasonable  rules and regulations  with respect thereto.
     Lessee  agrees to abide by and  conform to all such rules and  regulations,
     and to cause its employees, suppliers, shippers, customers, and invitees to
     so abide and  conform.  Lessor shall not be  responsible  to Lessee for the
     non-compliance  with said  rules and  regulations  by other  lessees of the
     Industrial Center.

2.6  Common  Areas  -Changes.  Lessor  shall have the right,  in  Lessor's  sole
     discretion,  from time to time:  (a) To make  changes to the Common  Areas,
     including,  without  limitation,  changes in the location,  size, shape and
     number of driveways,  entrances, parking spaces, parking areas, loading and
     unloading areas, ingress,  egress,  direction of traffic,  landscaped areas
     and  walkways;  (b)  To  close  temporarily  any of the  Common  Areas  for
     maintenance  purposes, so long as reasonable access to the Premises remains
     available;  (c) To  designate  other land  outside  the  boundaries  of the
     Industrial  Center to be a part of the Common Areas;  (d) To add additional
     buildings and improvements to the Common Areas; (e) To use the Common Areas
     while engaged in making additional improvements,  repairs or alterations to
     the Industrial  Center, or any portion thereof;  (f) To do and perform such
     other acts and make such other changes in, to or with respect to the Common
     Areas and  Industrial  Center  as Lessor  may,  in the  exercises  of sound
     business judgment, deem to be appropriate.

2.6.1Lessor  shall at all times  provide  the  parking  facilities  required  by
     applicable  law and in no event  shall the  number of parking  spaces  that
     Lessee  is  entitled  to  under  paragraph  2.2 be  reduced  and  shall  be
     maintained within the existing  boundaries of the Industrial  Center.  Upon
     ten (10) days  notice  from  Lessee  that there is a shortage  of  Lessee's
     pro-rata  share of parking  spaces,  Lessor  shall be  required to take all
     measures  necessary  (policing,  parking  permits,  parking gate) to ensure
     Lessee obtains its pro-rata allocation of parking spaces.

3.   Term.

3.1  Term.  The term of this Lease shall be for Sixty (60) months  commencing
     upon substantial completion of Tenant Improvements and ending  sixty (60)
     months  thereafter,  unless  sooner  terminated  pursuant to any  provision
     hereof. In no event shall the term of the Lease or any obligation of Lessee
     to pay rent on any space commence  until such space has been  substantially
     completed  pursuant to Lessee's final plans and  specifications  and Lessee
     can  reasonably  conduct its business.  Substantial  completion of Lessee's
     Premises  additionally  shall be  deemed  to mean that  Lessor  shall  have
     provided  to  Lessee  continuous  and  uninterrupted  access  to  Premises,
     Building and parking facilities  sufficient to accommodate Lessee's parking
     requirements (employees and visitors). In addition,  substantial completion
     shall mean that all systems and services to be furnished by Lessor pursuant
     to the  terms  and  conditions  of the  Lease  shall be in  continuous  and
     uninterrupted  effect and the  Building  has been issued a  Certificate  of
     Occupancy from the City of San Diego.

3.2  Delay in Possession.  Notwithstanding  said  commencement  date, if for any
     reason Lessor cannot  deliver  possession of the Premises to Lessee on said
     date,  Lessor shall not be subject to any  liability  therefore,  nor shall
     such failure affect the validity of this Lease or the obligations of Lessee
     hereunder or extend the term hereof,  but in such case, Lessee shall not be
     obligated to pay rent or perform any other  obligation  of Lessee under the
     terms of this  Lease,  except as may be  otherwise  provided in this Lease,
     until possession of the Premises is tendered to Lessee; provided,  however,
     that if Lessor shall not have delivered  possession of the Premises  within
     ninety  (90) days from said  commencement  date.  Lessee  may,  at Lessee's
     option,  by notice in  writing to Lessor  within ten (10) days  thereafter,
     cancel this Lease,  in which event the parties shall be discharged from all
     obligations  hereunder;  provided  further,  however,  that if such written
     notice of Lessee is not received by Lessor within said ten (10) day period,
     Lessee's right to cancel this Lease  hereunder shall terminate and be of no
     further force and effect.

3.3  Early   Possession.   If  Lessee   occupies  the  Premises  prior  to  said
     commencement date, such occupancy shall be subject to all provision of this
     Lease,  such occupancy shall not advance the  termination  date, and Lessee
     shall  pay rent for such  period  at the  initial  monthly  rates set forth
     below.  Lessee, along with its contractors,  subcontractors,  agents, etc.,
     shall be  permitted  to enter  Lessee's  Premises  at any time prior to the
     anticipated  commencement  date with no  obligation  to pay  rent,  for the
     purpose  of  installing  furniture,   fixtures,  equipment,  and  leasehold
     improvements.  Such  prior  occupancy  shall  not  interfere  with or delay
     completion of the tenant improvements, or result in additional costs to the
     Lessor.  This prior occupancy provision shall be separate and distinct from
     the obligation of Lessor and/or Lessee as to the completion of the basic or
     special leasehold improvements.

4.   Rent.

4.1  Base  Rent.  Lessee  shall pay to  Lessor,  as base Rent for the  Premises,
     without  any  offset or  deduction,  except as may be  otherwise  expressly
     provided  in this  Lease,  on the First (1st) day of each month of the term
     hereof,  monthly  payments  in  advance  of  per  schedule  -see  Addendum,
     Paragraph 47. Lessee shall pay Lessor upon execution  hereof $ 27,628.40 as
     Base Rent for the first  month of the Lease  term.  The second  months rent
     (payable  n Month 7) shall be equal  to the  amount  of the  prorated  rent
     applicable to the first month of the Lease term. Rent for any period during
     the  term  hereof  which is for less  than  one  month  shall be a pro rata
     portion  of the Base Rent.  Rent  shall be  payable in lawful  money of the
     United  States to  Lessor at the  address  stated  herein or to such  other
     persons or at such other places as Lessor may designate in writing.

4.2  Operating Expenses.  In the event Lessor's operating expenses which include
     landscape, general maintenance, repairs, real property taxes, fire casualty
     and  liability  insurance,  and  management  for the building  which Leased
     Premises  are a part shall,  in any  calendar  year during the term of this
     Lease,  exceed the base year  expenses as shown in Addendum  Paragraph  59,
     Lessee  agrees to pay as  Additional  Rent  Lessee's pro rata share of such
     excess operating  expenses.  Lessor may invoice Lessee monthly for Lessee's
     pro rata share of the estimated  operating expenses for each calendar year,
     which amount shall be adjusted each year based upon  anticipated  operating
     expenses.  Within nine months  following the close of each  calendar  year,
     Lessor shall provide Lessee an accounting  showing in reasonable detail all
     computations  of  Additional  Rent  due  this  section.  In the  event  the
     accounting shows that the total of the monthly payments made by
<PAGE>


     Lessee  Exceeds  the  amount of  Additional  Rent due by Lessee  under this
     section,  the Lessee  shall be entitled  to a refund of the excess.  In the
     event the accounting shows that the total of the monthly payments made
     by Lessee is less than the amount of  Additional  Rent due by Lessee  under
     this  section,  the  account  shall be  accompanied  by an invoice  for the
     Additional Rent. Notwithstanding any other provisions in this Lease, during
     the year in which the Lease  terminates,  Lessor,  prior to the termination
     date,  shall have the option to invoice  Lessee for Lessee's pro rata share
     of this excess operating expenses based upon the previous y ear's operating
     expenses. If this Lease shall terminate on a day other than the last day of
     a  calendar  year,  the  amount of any  Additional  Rent  payable by Lessee
     applicable  to the year in which  such  termination  shall  occur  shall be
     prorated on the ratio that the number of days from the  commencement of the
     calendar year to and including the  termination  date bears to 365.  Lessee
     shall have the right, at its own expense and within a reasonable  time, the
     audit Lessor's  books  relevant to the  Additional  Rent payable under this
     section.  Lessee agrees to pay any  Additional  Rent due under this section
     within ten days  following  receipt of this invoice or  accounting  showing
     Additional  Rent due.  Lessee shall be granted  protection from real estate
     tax  increases  as a result of the event of sale or  refinance  during  the
     initial Lease term. (See Addendum Paragraph 59.)

5.   Security Deposit.  Lessee shall deposit with Lessor upon execution hereof $
     27,628.40  as  security  for  Lessee's  faithful  performance  of  Lessee's
     obligations  hereunder.  If Lessee  fails to pay rent or other  charges due
     hereunder,  or otherwise  defaults  with  respect to any  provision of this
     Lease,  Lessor may use,  apply or retain all or any portion of said deposit
     for the  payment of any rent or other  charge in default or for the payment
     of any other sum to which Lessor may become obligated by reason of Lessee's
     default,  or to  compensate  Lessor for any loss or damage which Lessor may
     suffer  thereby.  If Lessor so uses or applies  all or any  portion of said
     deposit,  Lessee shall within ten (10) days after written demand  therefore
     deposit cash or check with Lessor in an amount  sufficient  to restore said
     deposit to the full amount then  required  of Lessee.  If the monthly  rent
     shall,  from time to time,  increase during the term of this Lease,  Lessee
     shall, at the time of such increase,  deposit with Lessor  additional money
     as a security deposit so that the total amount of the security deposit held
     by Lessor shall at all times bear the same  proportion  to the then current
     Base Rent as the initial  security  deposit  bears to the initial Base Rent
     set  forth in  paragraph  4.  Lessor  shall  not be  required  to keep said
     security deposit separate from its general accounts. If Lessee performs all
     of Lessee's obligations hereunder,  said deposit, or so much thereof as has
     not theretofore been applied by Lessor, shall be returned,  without payment
     of  interest  or other  increment  for its use,  to Lessee (or, at Lessor's
     option, to the last assignee,  if any, of Lessee's  interest  hereunder) at
     the  expiration  of the term  hereof,  and after  Lessee  has  vacated  the
     Premises.  No trust relationship is crated herein between Lessor and Lessee
     with respect to said Security Deposit.

6.   Use.

6.1  Use. The Premises  shall be used and occupied only for general office space
     and any other legally permitted uses compatible with a comparable  building
     in Kearny Mesa.

6.2  Compliance with Law.

(a)  Lessor  warrants to Lessee that the Premises,  in the state existing on the
     date that the Lease term commences, but without regard to the use for which
     Lessee  will  occupy  the  Premises,  does not  violate  any  covenants  or
     restrictions  of record,  or any applicable  building  code,  regulation or
     ordinance in effect on such Lease term  commencement  date. In the event it
     is determined  that this warranty has been  violated,  then it shall be the
     obligation of the Lessor, after written notice from Lessee, to promptly, as
     Lessor's sole cost and expense,  rectify any such  violation.  In the event
     Lessee  does not give to Lessor  written  notice of the  violation  of this
     warranty within six months from the date that the Lease term commences, the
     correction  of same shall be the  obligation of the Lessee at Lessee's sole
     cost. The warranty  contained in this paragraph 6.2(a) shall be of no force
     or  effect  if,  prior to the date of this  Lease,  Lessee  was an owner or
     occupant of the Premises and, in such event,  Lessor shall correct any such
     violation at Lessee's sole cost.

(b)  Except as provided in paragraph  6.2(a) Lessee shall, at Lessee's  expense,
     promptly   comply  with  all  applicable   statutes,   ordinances,   rules,
     regulations, orders, covenants and restrictions of record, and requirements
     of any fire  insurance  underwriters  or rating  bureaus,  now in effect or
     which may hereafter come into effect,  whether or not they reflect a change
     in policy from that now  existing,  during the term or any part of the term
     hereof,  relating in any manner to the Premises and the  occupation and use
     by Lessee of the Premises and of the Common Areas. Lessee shall not use nor
     permit the use of the  Premises or the Common Areas in any manner that will
     tend to create waste or nuisance or shall tend to disturb  other  occupants
     of the Industrial Center.

6.3  Condition of Premises.

(a)  Lessor shall deliver the Premises to Lessee clean and free of debris on the
     Lease commencement date (unless Lessee is already in possession) and Lessor
     warrants to Lessee that the plumbing,  lighting, air conditioning,  heating
     loading doors and roof in the Premises shall be in good operating condition
     on the Lease  commencement date. Lessor shall be responsible for making the
     alterations necessary to bring the parking area of Project into conformance
     with applicable code sufficient to allow general  contractor  and/or Lessee
     to obtain the necessary building permits.  Lessor shall indemnify Lessee as
     to any liability  related to any additional  Americans with  Disability Act
     (ADA) upgrades required to the exterior of the Premises.  In the event that
     it is determined that this warranty has been violated, then it shall be the
     obligation of Lessor,  after receipt of written  notice from Lessee setting
     forth  with  specificity  the nature of the  violation,  the  promptly,  at
     Lessor's sole cost,  rectify such violation.  Lessee's failure to give such
     written   notice  to  Lessor  within  thirty   (30)days   after  the  Lease
     commencement  date shall cause the conclusive  presumption  that Lessor has
     complied with all of Lessor's obligations hereunder. The warranty contained
     in this  paragraph  6.3(a)  shall be of no force or  effect if prior to the
     date of this Lease, Lessee was an owner or occupant of the Premises.

(b)  Except as  otherwise  provided in this  Lease,  Lessee  hereby  accepts the
     Premises in their condition  existing as of the Lease  commencement date or
     the date  that  Lessee  takes  possession  of the  Premises,  whichever  is
     earlier,  subject to all  applicable  zoning,  municipal,  county and state
     laws,  ordinances and  regulations  governing and regulating the use of the
     Premises,  and any covenants or  restrictions  of record,  and accepts this
     Lease  subject  thereto  and to all  matters  disclosed  thereby and by any
     exhibits  attached  hereto.  Lessee  acknowledges  that neither  Lessor nor
     Lessor's agent has made any representation or warranty as to the present or
     future suitability of the Premises for the conduct of Lessee's business.

7.   Maintenance, Repairs, Alterations and Common Area Services.

7.1  Lessor's   Obligations.   Subject  to  the  provisions  of  paragraphs  4.2
     (Operating Expenses),  6 (Use), 7.2 (Lessee's Obligations) and 9 (Damage or
     Destruction)  and except for damage caused by any negligent or  intentional
     act  or  omission  of  Lessee,  Lessee's  employees,  suppliers,  shippers,
     customers,  or  invitees,  in which event  Lessee  shall repair the damage,
     Lessor, at Lessor's expense, subject to reimbursement pursuant to paragraph
     4.2,  shall keep in good  condition  and repair the  foundations,  exterior
     walls,  structural  condition of interior  bearing  walls,  and roof of the
     Premises,  as well as the parking lots, walkways,  driveways,  landscaping,
     fences,  signs and utility  installations of the Common Areas and all parts
     thereof,  as well as providing the services for which there is an Operating
     Expense pursuant to paragraph 4.2. Lessor shall not, however,  be obligated
     to paint the  exterior or interior  surface of  exterior  walls,  nor shall
     Lessor be required to maintain,  repair or replace windows,  doors or plate
     glass of the  Premises.  Lessor  shall have no  obligation  to make repairs
     under this  paragraph 7.1 until a reasonable  time after receipt of written
     notice from Lessee of the need for such repairs.  Lessee  expressly  waives
     the  benefits  of any  statute  now or  hereafter  in  effect  which  would
     otherwise afford Lessee the right to make repairs at Lessor's expense or to
     the terminate  this Lease because of Lessor's  failure to keep the Premises
     in good order, condition and repair. Lessor shall not be liable for damages
     or loss of any kind or nature by reason of Lessor's  failure to furnish any
     Common Area  Services  when such failure is caused by  accident,  breakage,
     repairs,  strikes,  lockout, or other labor disturbances or disputes of any
     character, or by any other cause beyond the reasonable control of Lessor.

7.2  Lessee's Obligations.

(a)  Subject  to  the   provisions   of   paragraphs  6  (Use),   7.1  (Lessor's
     Obligations),  and 9 (Damage or Destruction),  Lessee, at Lessee's expense,
     shall keep in good order,  condition and repair the Premises and every part
     thereof (whether or not the damaged portion of the Premises or the means of
     repairing  the  same  are  reasonably  or  readily  accessible  to  Lessee)
     including,  without limiting the generality of the foregoing, all plumbing,
     heating, ventilating and air conditioning systems (Lessee shall procure and
     maintain,  at Lessee's expense,  a ventilating and air conditioning  system
     maintenance  contract),  electrical  and lighting  facilities and equipment
     within the  Premises,  fixtures,  interior  walls and interior  surfaces of
     exterior  walls,  ceilings,  windows,  doors,  plate glass,  and  skylights
     located  within the  Premises.  Lessor  reserves  the right to procure  and
     maintain the ventilating and air conditioning system maintenance  contract.
     Lessor,  within the operating expenses of the Building included in the base
     year,  shall be required to maintain  the HVAC,  plumbing,  electrical  and
     lighting, etc.

(b)  If Lessee fails to perform Lessee's obligations under this paragraph 7.2 or
     under any other paragraph of this Lease, Lessor may enter upon the Premises
     after then (10) days' prior written notice to Lessee (except in the case of
     emergency, in which no notice shall be required),  perform such obligations
     on  Lessee's  behalf and put the  Premises  in good  order,  condition  and
     repair,  and the cost thereof together with interest thereon at the maximum
     rate then  allowable by law shall be due and payable as additional  rent to
     Lessor together with Lessee's next Base Rent installment.

(c)  On the last day of the term hereof,  or on any sooner  termination,  Lessee
     shall  surrender the Premises to Lessor in the same  condition as received,
     ordinary  wear and tear  except,  clean and free of  debris.  Any damage or
     deterioration of the Premises shall not be deemed ordinary wear and tear if
     the same could have been prevented by good  maintenance  practices.  Lessee
     shall repair any damage to the Premises  occasioned by the  installation or
     removal of Lessee's trade fixtures, alterations, furnishings and equipment.
     Notwithstanding  anything to the contrary  otherwise  stated in this Lease,
     Lessee shall leave the air lines,  power  panels,  electrical  distribution
     systems,  lighting fixtures, space heaters, air conditioning,  plumbing and
     fencing on the Premises in good operating condition.

7.3  Alterations and Additions.

(a)  Lessee  shall  not,   without  Lessor's  prior  written  consent  make  any
     alterations,  improvements,  additions,  or Utility Installations in, on or
     about the Premises,  or the  Industrial  Center,  except for  nonstructural
     alterations  to the Premises not  exceeding $ 15,000 in  cumulative  costs,
     during the term of this Lease and not exceeding $10,000 in cumulative costs
     during any twelve (12) month period. In any event, whether or not excess of
     $ 15,000 in cumulative  cost,  Lessee shall make no change or alteration to
     the  exterior of the  Premises  nor the  exterior of the  Building  nor the
     Industrial  Center without Lessor's prior written consent.  As used in this
     paragraph 7.3 the term "Utility Installation" shall mean carpeting,  window
     covering,  air  lines,  power  panels,   electrical  distribution  systems,
     lighting fixtures, space heaters, air conditioning,  plumbing, and fencing.
     Lessor may  require  that  Lessee  remove  any or all of said  alterations,
     improvements,  additions or Utility  Installations at the expiration of the
     term,  and  restore  Premises  and the  Industrial  Center  to their  prior
     condition.  Lessor may require Lessee to provide  Lessor,  at Lessee's sole
     cost and expense,  a lien and completion bond in an amount equal to one and
     one-half  times the estimated cost of such  improvements,  to insure Lessor
     against any liability for mechanic's and materialmen's  liens and to insure
     completion of the work.  Should Lessee make any alterations,  improvements,
     additions  or Utility  Installations  without the prior  approval of Lessor
     may, at any time during the term of this Lease,  require that Lessee remove
     any or all of the same.

(b)  Any  alterations,  improvements,  additions or Utility  Installations in or
     about the  Premises or the  Industrial  Center that Lessee  shall desire to
     make and which  requires  the consent of the Lessor  shall be  presented to
     Lessor in written form, with proposed  detailed plans. If Lessor shall give
     its consent,  the consent shall be deemed conditioned upon Lessee acquiring
     a permit to do so from appropriate governmental agencies, the furnishing of
     a copy  thereof  to Lessor  prior to the  commencement  of the work and the
     compliance  by  Lessee of all  conditions  of said  permit in a prompt  and
     expeditious manner.

(c)  Lessee shall pay, when due, all claims for labor or materials  furnished or
     alleged  to  have  been  furnished  to or for  Lessee  at or for use in the
     Premises,  which  claims  are or  may  be  secured  by  any  mechanic's  or
     materialmen's  lien against the Premises,  or the Industrial Center, or any
     interest  therein.  Lessee  shall give  Lessor not less than ten (10) days'
     notice prior to the  commencement  of any work in the Premises,  and Lessor
     shall  have the right to post  notices of  non-responsibility  in or on the
     Premises or the  Building as  provided  by law.  If Lessee  shall,  in good
     faith,  contest the validity of any such lien, claim or demand, then Lessee
     shall,  at its sole expense  defend itself and Lessor  against the same and
     shall  pay and  satisfy  any such  adverse  judgment  that may be  rendered
     thereon before the  enforcement  thereof against the Lessor or the Premises
     or the Industrial Center,  upon the condition that if Lessor shall require,
     Lessee shall furnish to Lessor a surety bond  satisfactory  to Lessor in an
     amount equal to such  contested  lien claim or demand  indemnifying  Lessor
     against  liability for the same and holding the Premises and the Industrial
     Center free from the effect of such lien or claim. In addition,  Lessor may
     require Lessee to pay Lessor's attorneys fees and costs in participating in
     such action if Lessor  shall decide it is to Lessor's  best  interest to do
     so.

(d)  All alterations, improvements, additions and Utility Installations (whether
     or not such Utility  Installations  constitute  trade  fixtures of Lessee),
     which may be made on the  Premises,  shall be the  property  of Lessor  and
     shall remain upon and be surrendered with the Premises at the expiration of
     the Lease term,  unless Lessor requires their removal pursuant to paragraph
     7.3(a).  Notwithstanding the provisions of this paragraph 7.3(b),  Lessee's
     machinery and  equipment,  other than that which is affixed to the Premises
     so that it cannot be removed without  material damage to the Premises,  and
     other than Utility  Installations,  shall remain the property of Lessee and
     may be removed by Lessee subject to the provisions of paragraph 7.2.

7.4  Utility  Additions.  Lessor reserves the right to install new or additional
     utility  facilities  throughout  the  Building and the Common Areas for the
     benefit of Lessor or Lessee, or any other lessee of the Industrial  Center,
     including,  but  not by way of  limitation,  such  utilities  as  plumbing,
     electrical  systems,  security  systems,  communication  systems,  and fire
     protection  and detection  systems,  so long as such  installations  do not
     unreasonably interfere with Lessee's use of the Premises.

8.   Insurance; Indemnity.

8.1  Liability  Insurance-Lessee.  Lessee shall, at Lessee's expense, obtain and
     keep in force  during  the term of this Lease a policy of  Combined  Single
     Limit  Bodily  Injury and Property  Damage  Insurance  insuring  Lessee and
     Lessor  against  any  liability  arising  out  of  the  use,  occupancy  or
     maintenance of the Premises and the Industrial Center. Such insurance shall
     be in an amount not less than $500,000.00 per occurrence.  The policy shall
     insure performance by Lessee of the indemnity  provisions of this paragraph
     8. The limits of said insurance shall not, however,  limit the liability of
     Lessee hereunder.

8.2  Liability  Insurance-Lessor.  Lessor  shall obtain and keep in force during
     the term of this Lease a policy of Combined  Single Limit Bodily Injury and
     Property Damage  Insurance,  insuring Lessor,  but not Lessee,  against any
     liability  arising out of the ownership,  use,  occupancy or maintenance of
     the  Industrial   Center  in  an  amount  not  less  than  $500,000.00  per
     occurrence.

8.3  Property  Insurance.  Lessor shall obtain and keep in force during the term
     of this Lease a policy or policies of insurance  covering loss of damage to
     the Industrial Center  improvements,  but not Lessee's  personal  property,
     fixtures, equipment or tenant improvements,  in an amount not to exceed the
     full  replacement  value thereof,  as the same may exist from time to time,
     providing  protection against all perils included within the classification
     of fire, extended coverage,  vandalism,  malicious mischief,  flood (in the
     event same is required by a lender having a lien on the  Premises)  special
     extended  perils  ("all  risk",  as such  term  is  used  in the  insurance
     industry),  plate glass  insurance and such other insurance as Lessor deems
     advisable.  In addition,  Lessor shall obtain and keep in force, during the
     terms of this Lease, a policy of rental value  insurance  covering a period
     of one year, with loss payable to Lessor,  which insurance shall also cover
     shall also cover all Operating Expenses for said period.

8.4  Payment of Premium Increase.

(a)  After the term of this Lease has commenced, Lessee shall not be responsible
     for paying Lessee's Share of any increase in the property insurance premium
     for the Industrial Center specified by Lessor's  insurance carrier as being
     caused by the use, acts or omissions of any other lessees of the Industrial
     Center,  or by the nature of such other lessee's  occupancy which create an
     extraordinary or unusual risk.

8.5  Insurance  Policies.  Insurance  required  hereunder  shall be in companies
     holding a "General  Policyholders Rating" of at least B plus, or such other
     rating as may be required by a lender having a lien on the Premises, as set
     forth in the most current issue of "Best's Insurance  Guide".  Lessee shall
     not do or permit to be done anything  which shall  invalidate the insurance
     policies  carried  by Lessor.  Lessee  shall  deliver  to Lessor  copies of
     liability  insurance  policies required under paragraph 8.1 or certificates
     evidencing  the  existence and amounts of such  insurance  within seven (7)
     days after the  commencement  date of this Lease.  No such policy  shall be
     cancelable or subject to reduction of coverage or other modification except
     after thirty (30) days prior written  notice to Lessor.  Lessee  shall,  at
     last thirty (30) days prior to the  expiration  of such  policies,  furnish
     Lessor with renewals or "binders" thereof.

8.6  Waiver of  Subrogation.  Lessee and Lessor each hereby  release and relieve
     the other,  and waive their entire right of recovery  against the other for
     loss or damage  arising out of or incident  of the perils  insured  against
     which  perils  occur  in,  on or about  the  Premises,  whether  due to the
     negligence  of  Lessor  or Lessee o their  agents,  employees,  contractors
     and/or  invitees.  Lessee and Lessor shall,  upon obtaining the policies of
     insurance  required  hereunder,  give  notice to the  insurance  carrier or
     carriers that the foregoing  mutual waiver of  subrogation  is contained in
     this Lease.

8.7  Indemnity. Lessee shall indemnify and hold harmless Lessor from and against
     any and all claims arising from Lessee's use of the Industrial  Center,  or
     from the conduct of Lessee's business or from any activity,  work or things
     done, permitted or suffered by Lessee in or about the Premises or elsewhere
     and shall further  indemnify and hold harmless  Lessor from and against any
     and all claims arising from any breach or default in the performance of any
     obligation on Lessee's part to be performed  under the terms of this Lease,
     or arising from any act or omission of Lessee,  or any of Lessee's  agents,
     contractors, or employees, and from and against all costs, attorney's fees,
     expenses and  liabilities  incurred in the defense of any such claim or any
     action or proceeding brought thereon,  and in case any action or proceeding
     be brought  against Lessor by reason of any such claim.  Lessee upon notice
     from Lessor shall defend the same at Lessee's expense by counsel reasonably
     satisfactory  to Lessor  and Lessor  shall  cooperate  with  Lessee in such
     defense.  Lessee, as a material part of the consideration to Lessor, hereby
     assumes all risk of damage to property of Lessee or injury to persons,  in,
     upon or about the Industrial  Center and Lessee hereby waives all claims in
     respect  thereof  against  Lessor.

8.8 Exemption of Lessor from Liability.
     Lessee hereby agrees that Lessor shall not be liable for injury to Lessee's
     business or any loss of income therefrom or for damage to the goods, wares,
     merchandise  or other  property of Lessee,  Lessee's  employees,  invitees,
     customers,  or any other person in or about the Premises or the  Industrial
     Center,  nor shall  Lessor be liable  for  injury to the  person of Lessee,
     Lessee's employees, agents or contractors, whether such damage or injury is
     caused by or results from fire, steam, electricity,  gas, water or rain, or
     from  the  breakage,  leakage,  obstruction  or  other  defects  of  pipes,
     sprinklers,  wires,  appliances,  plumbing,  air  conditioning  or lighting
     fixtures,  or from any other cause,  whether said damage or injury  results
     from  conditions  arising upon the  Premises or upon other  portions of the
     Industrial  Center,  or from  other  sources or places  and  regardless  of
     whether  the cause of such damage or injury or the means of  repairing  the
     same is inaccessible to Lessee.  Lessor shall not be liable for any damages
     arising  from any act or neglect of any other  lessee,  occupant or user of
     the  Industrial  Center,  nor from the  failure  of Lessor to  enforce  the
     provisions of any other lease of the Industrial Center.


9.   Damage or Destruction.

9.1  Definitions.

(a)  "Premises  Partial  Damage"  shall  mean if the  Premises  are  damaged  or
     destroyed to the extent that the cost of repair is less than fifty  percent
     of the then replacement cost of the Premises.
(b)  "Premises  Total  Destruction"  shall mean if the  Premises  are damaged or
     destroyed to the extent that the cost of repair is fifty percent or more of
     the then replacement cost of the Premises.
(c)  "Premises  Building Partial Damage" shall mean if the Building of which the
     Premises  are a part is damaged or destroyed to the extent that the cost to
     repair is less  than  fifty  percent  of the then  replacement  cost of the
     Building.
(d)  "Premises  Building Total  Destruction" shall mean if the Building of which
     the Premises are a part is damaged or destroyed to the extent that the cost
     to  repair is fifty  percent  or more of the then  replacement  cost of the
     Building.
(e)  "Industrial  Center  Buildings"  shall  mean  all of the  buildings  on the
     Industrial Center site.
(f)  "Industrial   Center  Buildings  Total   Destruction"  shall  mean  if  the
     Industrial Center Buildings are damaged or destroyed to the extent that the
     cost of repair is fifty percent or more of the then replacement cost of the
     Industrial Center Buildings.
(g)  "Insured  Loss"  shall mean  damage or  destruction  which was caused by an
     event required to be covered by the insurance described in paragraph 8. The
     fact that an Insured Loss has a  deductible  amount shall not make the loss
     an uninsured loss.
(h)  "Replacement  Cost" shall mean the amount of money necessary to be spent in
     order to repair or rebuild the damaged area to the  condition  that existed
     immediately  prior to the damage occurring  excluding all improvements made
     by lessees.

9.2  Premises Partial Damage; Premises Building Partial Damage.

(a)  Insured Loss:  Subject to the  provisions of paragraphs  9.4 and 9.5, if at
     any time during the term of this Lease there is damage  which is an insured
     Loss and which falls into the  classification  of either  Premises  Partial
     Damage or Premises Building Partial Damage,  then Lessor shall, at Lessor's
     expense,  repair such damage to the  Premises,  but not Lessee's  fixtures,
     equipment or tenant  improvements,  as soon as reasonably possible and this
     Lease shall continue in full force effect.
(b)  Uninsured Loss:  Subject to the provisions of paragraphs 9.4 and 9.5, if at
     any time  during  the term of this  Lease  there is damage  which is not an
     insured Loss and which falls within the  classification of Premises Partial
     Damage or Premises Building Partial Damage, unless caused by a negligent or
     willful  act of Lessee (in which  event  Lessee  shall make the  repairs at
     Lessee's  expense),  which damage  prevents Lessee from using the Premises,
     Lessor may at  Lessor's  option  either (i) repair  such  damage as soon as
     reasonably  possible at Lessor's  expense,  in which event this Lease shall
     continue in full force and effect,  or (ii) give  written  notice to Lessee
     within thirty (30) days after the date of the  occurrence of such damage of
     Lessor's intention to cancel and terminate this Lease as of the date of the
     occurrence of such damage. In the event,  Lessor elects to give such notice
     of Lessor's intention to cancel and terminate this Lease, Lessee shall have
     the right  within  ten (10) days after the  receipt of such  notice to give
     written  notice to Lessor of  Lessee's  intention  to repair such damage at
     Lessee's expense,  without  reimbursement  from Lessor, in which event this
     Lease shall continue in full force and effect,  and Lessee shall proceed to
     make such repairs as soon as reasonably  possible.  If Lessee does not give
     such notice  within such 10-day  period this Lease shall be  cancelled  and
     terminated as of the date of the occurrence of such damage.

9.3  Premises Total Destruction; Premises Building Total Destruction. Industrial
     Center Buildings Total Destruction

(a)  Subject to the  provisions of paragraphs 9.4 and 9.5, if at any time during
     the term of this  Lease  there is  damage,  whether or not it is an Insured
     Loss, and which falls into the classifications of either (i) Premises Total
     Destruction,   or  (ii)  Premises  Building  Total  Destruction,  or  (iii)
     Industrial Center Buildings Total Destruction,  then Lessor may at Lessor's
     option  either (i) repair  such  damage or  destruction,  but not  Lessee's
     fixtures, equipment or tenant improvements,  as soon as reasonably possible
     at  Lessor's  expense,  and this  Lease  shall  continue  in full force and
     effect, or (ii) give written notice to Lessee within thirty (30) days after
     the date of occurrence  of such damage of Lessor's  intention to cancel and
     terminate  this  Lease,  in which case this Lease  shall be  cancelled  and
     terminated as of the date of the occurrence of such damage.

9.4  Damage Near End of Term.

(a)  Subject to paragraph  9.4(b),  if at any time during the last six months of
     the term of this  Lease  there is  substantial  damage,  whether  or not an
     Insured Loss,  which falls within the  classification  of Premises  Partial
     Damage, Lessor may at Lessor's option cancel and terminate this Lease as of
     the date of occurrence of such damage by giving written notice to Lessee of
     Lessor's  election to do so within 30 days after the date of  occurrence of
     such damage.
(b)  Notwithstanding paragraph 9.4(a), in the event that Lessee has an option to
     extend or renew this Lease,  and the time  within  which said option may be
     exercised has not yet expired,  Lessee shall exercise such option, if it is
     to be exercised at all, no later than twenty (20) days after the occurrence
     of an Insured Loss falling within the  classification  of Premises  Partial
     Damage during the last six months of the term of this Lease. If Lessee duly
     exercises such option during said twenty (20) day period,  Lessor shall, at
     Lessor's expense, repair such damage, but not Lessee's fixtures,  equipment
     or tenant improvements, as soon as reasonably possible and this Lease shall
     continue in full force and effect.  If Lessee fails to exercise such option
     during  said twenty  (20) day  period,  then Lessor may at Lessor's  option
     terminate  and cancel this Lease as of the  expiration  of said twenty (20)
     day period by giving written notice to Lessee of Lessor's election to do so
     within ten (10) days after the  expiration  of said twenty (20) day period,
     notwithstanding  any  term or  provision  in the  grant  of  option  to the
     contrary.

9.5  Abatement of Rent; Lessee's Remedies.

(a)  In the event  Lessor  repairs or  restores  the  Premises  pursuant  to the
     provisions of this  paragraph 9, the rent payable  hereunder for the period
     during which such damage,  repair or restoration  continues shall be abated
     in  proportion  to the  degree to which  Lessee's  use of the  Premises  is
     impaired.  Except for abatement of rent, if any, Lessee shall have no claim
     against  Lessor  for any  damage  suffered  by reason  of any such  damage,
     destruction, repair or restoration.
(b)  If Lessor shall be  obligated  to repair or restore the Premises  under the
     provisions  of this  paragraph  9 and shall  not  commence  such  repair or
     restoration  within  ninety (90) days after such  obligation  shall accrue,
     Lessee may at  Lessee's  option  cancel and  terminate  the Lease by giving
     Lessor  written  notice of Lessee's  election to do so at any time prior to
     the  commencement of such repair or  restoration.  In such event this Lease
     shall terminate as of the date of such notice.

9.6  Termination-Advance Payments.  Upon termination of this Lease pursuant to
     this paragraph 9, an equitable  adjustment shall be made concerning advance
     rent and any advance  payments made by Lessee to Lessor.  Lessor shall,  in
     addition,  return to Lessee so much of Lessee's security deposit as has not
     theretofore been applied by Lessor.

9.7  Waiver.  Lessor and Lessee waive the provisions of any statute which relate
     to termination  of leases when leased  property is destroyed and agree that
     such event shall be governed by the terms of this Lease.

10.  Real Property Taxes.

10.1 Payment of Tax Increase. Lessor shall pay the real property tax, as defined
     in paragraph 10.3, applicable to the Industrial Center, provided,  however,
     that Lessee shall pay, in addition to rent,  Lessee's  Share (as defined in
     paragraph  4.2) of the  amount,  if  any,  by  which  real  property  taxes
     applicable  to the Premises  increase  over the fiscal real estate tax year
     1994-1995.  Such payment  shall be made by Lessee  within  thirty (30) days
     after  receipt of Lessor's  written  statement  setting forth the amount of
     such increase and the computation  thereof. If the term of this Lease shall
     not  expire  concurrently  with  the  expiration  of the tax  fiscal  year.
     Lessee's  liability  for  increased  taxes for the last partial  lease year
     shall be prorated on an annual basis.

10.2 Additional  Improvements.  Lessee  shall  not  be  responsible  for  paying
     Lessee's  share of any increase in real  property tax  specified in the tax
     assessor's   record's  and  work  sheets  as  being  caused  by  additional
     improvements  placed  upon the  Industrial  Center by other  lessees  or by
     Lessor for the  exclusive  enjoyment of such other  lessees.  Lessee shall,
     however,  pay to Lessor at the time that  Operating  Expenses  are  payable
     under  paragraph  4.2 the entirety of any increase in real  property tax if
     assessed  soley  by  reason  of  additional  improvements  placed  upon the
     premises by Lessee or at Lessee's request after 1995.

10.3 Definition of "Real Property Tax". As used herein,  the term "real property
     tax" shall  include  any form of real  estate tax or  assessment,  general,
     special, ordinary, or extraordinary, and any license fee, commercial rental
     tax,  improvement  bond or bonds,  levy,  or tax (other  than  inheritance,
     personal  income or estate taxes) imposed on the  Industrial  Center or any
     portion  thereof by any  authority  having the direct or indirect  power to
     tax,  including  any city,  county,  state or  federal  government,  or any
     school, agricultural, sanitary, fire, street, drainage or other improvement
     district thereof,  as against any legal or equitable  interest of Lessor in
     the Industrial Center or in any portion thereof,  as against Lessor's right
     to rent or other  income  therefrom,  and as against  Lessor's  business of
     leasing the  Industrial  Center.  The term "real  property  tax" shall also
     include any tax, fee, levy,  assessment or charge (i) in  substitution  of,
     partially or totally, any tax, fee, levy,  assessment or charge hereinabove
     included  within the  definition of "real property tax", or (ii) the nature
     of which was hereinbefore  included within the definition of "real property
     tax", or (iii) which is imposed for a service or right not charged prior to
     June 1, 1978, or, if previously  charged,  has been increased since June 1,
     1978, or (iv) which is imposed as a result of a transfer, either partial or
     total, of Lessor's interest in the Industrial Center or which is added to a
     tax or charge hereinbefore  included within the definition of real property
     tax by reason of such  transfer,  or (v) which is imposed by reason of this
     transaction, any modifications or changes hereto, or any transfers hereof.

10.4 Joint  Assessment.  If the Industrial  Center is not  separately  assessed,
     Lessee's  Share of the real  property tax  liability  shall be an equitable
     proportion of the real property taxes for all of the land and  improvements
     included within the tax parcel  assessed,  such proportion to be determined
     by Lessor from the respective  valuations  assigned in the assessor's  work
     sheets or such other information as may be reasonably  available.  Lessor's
     reasonable determination thereof, in good faith, shall be conclusive.

10.5 Personal Property Taxes.

(a)  Lessee shall pay prior to delinquency all taxes assessed against and levied
     upon trade fixtures, furnishings, equipment and all other personal property
     of Lessee  contained in the Premises or elsewhere.  When  possible,  Lessee
     shall  cause  said trade  fixtures,  furnishings,  equipment  and all other
     personal  property  to be  assessed  and  billed  separately  from the real
     property of Lessor.
(b)  If any of Lessee's said personal  property  shall be assessed with Lessor's
     real property,  Lessee shall pay to Lessor the taxes attributable to Lessee
     within ten (10) days after receipt of a written statement setting forth the
     taxes applicable to Lessee's property.

11.  Utilities.  Lessee shall pay for all, electricity and telephone supplied to
     the Premises, together with any taxes thereon. If any such services are not
     separately  metered to the Premises,  Lessee shall pay at Lessor's  option,
     either Lessee's Share or a reasonable proportion to be determined by Lessor
     of all charges jointly metered with other premises in the Building.  Lessor
     shall pay for water, gas and sewer.

12.  Assignment and Subletting.

12.1 Lessor's Consent Required.  Lessee shall not voluntarily or by operation of
     law assign, transfer,  mortgage,  sublet, or otherwise transfer or encumber
     all or any part of  Lessee's  interest  in the  Lease  or in the  Premises,
     without Lessor's prior written consent, which Lessor shall not unreasonably
     withhold. Lessor shall respond to Lessee's request for consent hereunder in
     a  timely  manner  and  any  attempted  assignment,   transfer,   mortgage,
     encumbrance  or subletting  without such consent  shall be void,  and shall
     constitute  a breach of this  Lease  without  the need for notice to Lessee
     under paragraph 13.1.

12.2 Lessee Affiliate.  Notwithstanding the provisions of paragraph 12.1 hereof,
     Lessee may assign or sublet the Premises,  or any portion thereof,  without
     Lessor's consent, to any corporation which controls, is controlled by or is
     under common control with Lessee, or to any corporation  resulting from the
     merger or  consolidation  with  Lessee,  or to any  person or entity  which
     acquires all the assets of Lessee as a going  concern of the business  that
     is being conducted on the Premises, all of which are referred to as "Lessee
     Affiliate",  provided that before such  assignment  shall be effective said
     assignee shall assume, in full, the obligations of Lessee under this Lease.
     Any such assignment shall not, in any way, affect or limit the liability of
     Lessee  under the terms of this  Lease  even if after  such  assignment  or
     subletting  the  terms of this  Lease are  materially  changed  or  altered
     without the consent of Lessee, the consent of whom shall not be necessary.

12.3 Terms and  Conditions of  Assignment.  Regardless of Lessor's  consent,  no
     assignment shall release Lessee of Lessee's obligations  hereunder or alter
     the primary  liability of Lessee to pay the Base Rent and Lessee's Share of
     Operating Expenses, and to perform all other obligations to be performed by
     Lessee hereunder.  Lessor may accept rent from any person other than Lessee
     pending approval or disapproval of such assignment.  Neither a delay in the
     approval or disapproval of such assignment nor the acceptance of rent shall
     constitute a waiver or estoppel of Lessor's  right to exercise its remedies
     for the breach of any of the terms or  conditions  of this  paragraph 12 or
     this Lease.  Consent to one  assignment  shall not be deemed consent to any
     subsequent assignment. In the event of default by any assignee of Lessee or
     any  successor of Lessee,  in the  performance  of any of the terms hereof,
     Lessor may  proceed  directly  against  Lessee  without  the  necessity  of
     exhausting remedies against said assignee. Lessor may consent to subsequent
     assignments of this Lease or amendments or modifications to this Lease with
     assignees of Lessee,  without notifying Lessee, or any successor of Lessee,
     and without  obtaining its or their  consent  thereto and such action shall
     not relieve Lessee of liability under this Lease.

12.4 Terms and  Conditions  Applicable  to  Subletting.  Regardless  of Lessor's
     consent,  the following terms and conditions  shall apply to any subletting
     by  Lessee of all or any part of the  Premises  and  shall be  included  in
     sublessee:

(a)  Lessee hereby assigns and transfers to Lessor all of the Lessee's  interest
     in all rentals and income arising from any sublease heretofore or hereafter
     made by Lessee,  and Lessor may collect such rent and income and apply same
     toward Lessee's obligations under the Lease; provided,  however, that until
     a default shall occur I the performance of Lessee's  obligations under this
     Lease, Lessee may receive,  collect and enjoy the rents accruing under such
     sublease.  Lessor shall not, by reason of this or any other  assignment  of
     such sublease to Lessor nor by reason of the collection of the rents from a
     sublessee,  be deemed  liable to the sublessee for any failure of Lessee to
     perform and comply with any of Lessee's obligations to such sublessee under
     such sublease.  Lessee hereby  irrevocably  authorizes and directs any such
     sublessee,  upon  receipt of a written  notice from Lessor  stating  that a
     default exists in the performance of Lessee's obligations under this Lease,
     to pay to Lessor the rents due and to become due under the sublease.
(b)  No sublease  entered into by Lessee shall be effective  unless and until it
     has been approved in writing by Lessor.  Additionally, such sublease shall
     not be changed or modified  without  Lessor's  prior written  consent.  Any
     sublessee shall, by reason of entering into a sublease under this Lease, be
     deemed,  for the benefit of Lessor,  to have  assumed and agreed to conform
     and comply with each and every obligation  herein to be performed by Lessee
     other  than  such  obligations  as are  contrary  to or  inconsistent  with
     provisions  contained in a sublease to which Lessor has expressly consented
     in writing.
(c)  If  Lessee's  obligations  under this Lease have been  guaranteed  by third
     parties,  then a  sublease,  and  Lessor's  consent  thereto,  shall not be
     effective unless and guarantors give their written consent to such sublease
     and the terms thereof.
(d)  The consent by Lessor to any  subletting  shall not release Lessee from its
     obligations  or alter the primary  liability  of Lessee to pay the rent and
     perform and comply with all of the  obligations  of Lessee to be  performed
     under this Lease.
(e)  The consent by Lessor to any  subletting  shall not constitute a consent to
     any  subsequent  subletting by Lessee or to any assignment or subletting by
     the sublessee.  However,  Lessor may consent to subsequent  sublettings and
     assignments  of the sublease or any  amendments or  modifications  thereto
     without notifying Lessee or anyone else liable on the Lease or sublease and
     without  obtaining  their  consent and such action  shall not relieve  such
     persons from liability.
(f)  In the event of any default  under this Lese,  Lessor may proceed  directly
     against  Lessee,  any  guarantors  or any  one  else  responsible  for  the
     performance of this Lease, without first  exhausting  Lessor's  remedies
     against any other person or entity responsible  therefore to Lessor, or any
     security held Lessor or Lessee.
(g)  In the event Lessee shall  default in the  performance  of its  obligations
     under this Lease,  Lessor,  at its option and without any  obligation to do
     so, may require any  sublessee  to attorn to Lessor,  in which event Lessor
     shall undertake the obligations of Lessee under such sublease from the time
     of the  exercise  of said  option  to the  termination  of  such  sublease;
     provided,  however,  Lessor  shall not be liable for any  prepaid  rents or
     security  deposit  paid by such  sublessee to Lessee or for any other prior
     defaults of Lessee under such sublease.
(h)  Each and every  consent  required  of Lessee  under a  sublease  shall also
     require the consent of Lessor.
(i)  No  sublessees  shall  further  assign  or  sublet  all or any  part of the
     Premises without Lessor's prior written consent.
(j)  Lessor's  written consent to any subletting of the Premises by Lessee shall
     not  constitute an  acknowledgement  that no default then exists under this
     Lease of the  obligations  to be performed by Lessee nor shall such consent
     be deemed a waiver of any then existing default, except as may be otherwise
     stated by Lessor at the time.
(k)  With respect to any subletting to which Lessor has consented, Lessor agrees
     to deliver a copy of any notice of default by Lessee to the sublessee. Such
     sublessee  shall have the right to cure a default of Lessee within ten (10)
     days after service of said notice of default upon such  sublessee,  and the
     sublessee shall have a right of  reimbursement  and offset from and against
     Lessee for any such defaults cured by the sublessee.

12.5 Attorney's Fees. In the event Lessee shall assign or sublet the Premises or
     request the consent of Lessor to any  assignment or subletting or if Lessee
     shall request the consent of Lessor for any act Lessee  proposes to do then
     Lessee shall pay Lessor's reasonable  attorneys fees incurred in connection
     therewith, such attorneys fees not to exceed $350.00 for each such request.
     13. Default; Remedies.

13.1 Default.  The  occurrence of any one or more of the following  events shall
     constitute a material default of this Lease by Lessee:

(a)  The abandonment of the Premises by Lessee.
(b)  The  failure  by Lessee to make any  payment  of rent or any other  payment
     required  to be made by  Lessee  hereunder,  as and when  due,  where  such
     failure shall  continue for a period of five (5) days after written  notice
     thereof from Lessor to Lessee.  In the event that Lessor serves Lessee with
     a Notice  to Pay Rent or Quit  pursuant  to  applicable  Unlawful  Detainer
     statutes such Notice to Pay Rent or Quit shall also  constitute  the notice
     required by this subparagraph.
(c)  Except as  otherwise  provided  in this  Lease,  the  failure  by Lessee to
     observe or perform any of the  covenants,  conditions or provisions of this
     Lease to be  observed  or  performed  by Lessee,  other than  described  in
     paragraph  (b) above,  where such  failure  shall  continue for a period of
     thirty  (30) days  after  written  notice  thereof  from  Lessor to Lessee;
     provided,  however,  that if the nature of Lessee's  noncompliance  is such
     that more than thirty (30) days are reasonably  required for its cure, then
     Lessee shall not be deemed to be in default if Lessee  commenced  such cure
     within  said thirty (30) day period and  thereafter  diligently  prosecutes
     such cure to completion.  To the extent  permitted by law, such thirty (30)
     day notice shall  constitute the sole and exclusive  notice  required to be
     given to Lessee under applicable Unlawful Detainer statutes.
(d)  (i) The making by Lessee of any general  arrangement or general  assignment
     for the benefit of creditors;  (ii) Lessee becomes a "debtor" as defined in
     11 U.S.C. ss.101 or any successor statute thereto (unless, in the case of a
     petition  filed  against  Lessee,  the same is dismissed  within sixty (60)
     days); (iii) the appointment of a trustee or receiver to take possession of
     substantially all of Lessee's assets located at the Premises or of Lessee's
     interest in this Lease,  where  possession is not restored to Lessee within
     thirty  (30) days;  or (iv) the  attachment,  execution  or other  judicial
     seizure of substantially  all of Lessee's assets located at the Premises or
     of Lessee's  interest in this Lease,  where such seizure is not  discharged
     within thirty (30) days. In the event that any provision of this  paragraph
     13.1 (d) is contrary to any applicable  law, such provision  shall be of no
     force or effect.
(e)  The  discovery by Lessor that any  financial  statement  given to Lessor by
     Lessee,  any assignee of Lessee,  , any  successor in interest of Lessee or
     any guarantor of Lessee's obligation hereunder, was materially false.

13.2 Remedies.  In the event of any such material default by Lessee,  Lessor may
     at any time  thereafter,  with or  without  notice  or demand  and  without
     limiting  Lessor in the  exercise of any right or remedy  which  Lessor may
     have by reason of such default:
(a)  Terminate Lessee's right to possession of the Premises by any lawful means,
     in which case this Lease and the term  hereof  shall  terminate  and Lessee
     shall immediately  surrender  possession of the Premises to Lessor. In such
     event Lessor shall be entitled to recover from Lessee all damages  incurred
     by Lessor by reason of Lessee's default including,  but not limited to, the
     cost of  recovering  possession  of the  Premises;  expenses of  reletting,
     including necessary  renovation and alteration of the Premises,  reasonable
     attorney's fees, and any real estate commission actually paid; the worth at
     the time of award by the court having jurisdiction thereof of the amount by
     which the  unpaid  rent for the  balance of the term after the time of such
     award  exceeds  the amount of such  rental  loss for the same  period  that
     Lessee  proves  could be  reasonably  avoided;  that portion of the leasing
     commission  paid by Lessor  pursuant  to  paragraph  15  applicable  to the
     unexpired term of this Lease.
(b)  Maintain  Lessee's  right to  possession  in which  case this  Lease  shall
     continue in effect whether or not Lessee shall have abandoned the Premises.
     In such event  Lessor  shall be entitled to enforce all of Lessor's  rights
     and remedies  under this Lease,  including the right to recover the rent as
     it becomes due hereunder.
(c)  Pursue any other remedy now or hereafter available to Lessor under the laws
     or judicial decisions of the state wherein the Premises are located. Unpaid
     installments of rent and other unpaid monetary  obligations of Lessee under
     the  terms  of this  Lease  shall  bear  interest  from the date due at the
     Default  Rate  defined  as Bank of  America  prime  lending  rate plus five
     percent (15%).

13.3 Default by Lessor.  Lessor shall not be in default  unless  Lessor fails to
     perform obligations  required of Lessor within a reasonable time, but in no
     event later than thirty (30) days after written  notice by Lessee to Lessor
     and to the  holder  of any first  mortgage  or deed of trust  covering  the
     Premises  whose name and address shall have  theretofore  been furnished to
     Lessee in writing,  specifying  wherein  Lessor has failed to perform  such
     obligation; provided, however, that if the nature of Lessor's obligation is
     such that more than  thirty (30) days are  required  for  performance  then
     Lessor shall not be in default if Lessor commences  performance within such
     thirty (30) day period and  thereafter  diligently  prosecutes  the same to
     completion.

13.4 Late  Charges.  Lessee hereby  acknowledges  that late payment by Lessee to
     Lessor of Base Rent, Lessee's Share of Operating Expenses or other sums due
     hereunder will cause Lessor to incur costs not  contemplated by this Lease,
     the exact amount of which will be extremely  difficult to  ascertain.  Such
     costs include,  but are not limited to processing  and accounting  charges,
     and late  charges  which  may be  imposed  on  Lessor  by the  terms of any
     mortgage or trust dead covering the Industrial Center.  Accordingly, if any
     installment  of Base Rent,  Operating  Expenses,  or any other sum due from
     Lessee shall not be received by Lessor or Lessor's designee within ten (10)
     days after such amount  shall be due,  then,  without any  requirement  for
     notice to Lessee,  Lessee  shall pay to Lessor a late charge equal to 3% of
     such  overdue  amount.  The  parties  hereby  agree  that such late  charge
     represents a fair and reasonable estimate of the costs Lessor will incur by
     reason of late payment by Lessee.  Acceptance of such late charge by Lessor
     shall in no event  constitute a waiver of Lessee's  default with respect to
     such overdue  amount,  nor prevent Lessor from  exercising any of the other
     rights and remedies granted  hereunder.  In the event that a late charge is
     payable  hereunder,  whether or not  collected,  for three (3)  consecutive
     installments of any of the aforesaid monetary  obligations of Lessee,  then
     Base Rent shall automatically  become due and payable quarterly in advance,
     rather than monthly,  notwithstanding  paragraph 4.1 or any other provision
     of this Lease to the contrary.

14.  Condemnation,  If the  Premises  or any portion  thereof or the  Industrial
     Center  are taken  under the power of  eminent  domain,  or sold  under the
     threat  of the  exercise  of said  power  (all of which are  herein  called
     "condemnation"),  this Lease shall  terminate as to the part so taken as of
     the date the  condemning  authority  takes title or  possession,  whichever
     first  occurs.  If more than ten percent of the floor area of the Premises,
     or more than  twenty-five  percent  of that  portion  of the  Common  Areas
     designated as parking for the Industrial  Center is taken by  condemnation,
     Lessee may, at Lessee's  option,  to be  exercised  in writing  only within
     thirty (30) days after  Lessor shall have given  Lessee  written  notice of
     such  taking (or in the  absence of such  notice,  within  thirty (30) days
     after the condemning authority shall have taken possession)  terminate this
     Lease as of the date the condemning  authority  takes such  possession.  It
     Lessee does not terminate this Lease in accordance with the foregoing, this
     Lease  shall  remain in full  force and  effect  as to the  portion  of the
     Premises remaining, except that the rent shall be reduced in the proportion
     that the floor area of the Premises  taken bears to the total floor area of
     the  Premises.  No  reduction of rent shall occur if the only area taken is
     that which does not have the Premises  located  thereon.  Any award for the
     taking of all or any part of the Premises under the power of eminent domain
     or any payment made under threat of the exercise of such power shall be the
     property of Lessor,  whether such award shall be made as  compensation  for
     diminution  in value of the  leasehold  or for the taking of the fee, or as
     severance damages; provided,  however, that Lessee shall be entitled to any
     award  for loss of or damage  to  Lessee's  trade  fixtures  and  removable
     personal  property  and  the  present  value  of  the  remaining  leasehold
     interest.  In the event that this Lease is not terminated by reason of such
     condemnation,  Lessor shall to the extent of severance  damages received by
     Lessor in  connection  with such  condemnation,  repair  any  damage to the
     Premises caused by such  condemnation  except to the extent that Lessee has
     been reimbursed therefor by the condemning authority.  Lessee shall pay any
     amount  in excess of such  severance  damages  required  to  complete  such
     repair.

15.  Broker's Fee.

(a)  Upon  execution  of this Lease by both  parties,  Lessor  shall pay to John
     Burnham and Company,  Licensed real estate broker(s), a fee as set forth in
     a separate  agreement  between Lessor and said  broker(s),  or in the event
     there is no separate  agreement between Lessor and said broker(s),  the sum
     of  $____________,  for brokerage  services  rendered by said  broker(s) to
     Lessor in this transaction.
(b)  Upon  execution of this Lease by both parties,  Lessor shall pay to Cushman
     Realty  Corporation,  licensed real estate broker,  a fee as set forth is a
     separate  agreement between said broker and calculated as five percent (5%)
     of the NNN rental rate for the term of the Lease.  In the event that Lessor
     fails to pay any amounts to broker on or before the date(s) due, broker may
     send  written  notice to Lessor  and Lessee of such  failure  and if Lessor
     fails to pay said amounts within thirty (30) days after said notice, Lessee
     shall have the option to pay to broker  amounts  due and to offset  amounts
     against Lessee's next rental obligations which may become due under a fully
     executed Lease.
(c)  Lessor  further  agrees that if Lessee  exercises an Option,  as defined in
     paragraph 39.1 of this Lease,  which is granted to Lessee under this Lease,
     or any  subsequently  granted option which is  substantially  similar to an
     Option granted to Lessee under this Lease, or if Lessee acquires any rights
     to the  Premises  or other  premises  described  in this  Lease  which  are
     substantially  similar to what  Lessee  would have  acquired  had an Option
     herein granted to lessee been exercised, or if Lessee remains in possession
     of the  Premises  after the  expiration  of the terms of this  Lease  after
     having failed to exercise an Option, or if said broker(s) are the procuring
     cause  of any  other  lease  or  sale  entered  into  between  the  parties
     pertaining to the Premises and/or any adjacent property in which Lessor has
     an  interest,  then as to any of said  transactions,  Lessor shall pay said
     broker(s) a fee in accordance with the schedule of said broker(s)
     in effect at the time of execution of this Lease.
(d)  Lessor  agrees to pay said fee not only on  behalf  of  Lessor  but also on
     behalf of any person,  corporation,  association  or other entity having an
     ownership interest in said real property or any part thereof, when such fee
     is due  hereunder.  Any  transferee  of Lessor's  interests  in this Lease,
     whether such  transfer is by  agreement  or by  operation of law,  shall be
     deemed to have assumed  Lessor's  obligation  under this paragraph 15. Said
     broker shall be third party beneficiary of the provisions of this paragraph
     15.

16.  Estoppel Certificate.

(a)  Each party (as "responding party") shall at any time upon not less than ten
     (10) days' prior written notice from the other party  ("requesting  party")
     execute,  acknowledge  and deliver to the requesting  party a statement in
     writing (i) certifying  that this Lease is unmodified and in full force and
     effect  (or,  if  modified,  stating  the nature of such  modification  and
     certifying  that this Lease,  as so modified,  is in full force and effect)
     and the date to which the rent and other  charges are paid in  advance,  if
     any, and (ii)  acknowledging  that there are not, to the responding party's
     knowledge,  any uncured  defaults on the part of the requesting  party,  or
     specifying  such  defaults in any are claimed.  Any such  statement  may be
     conclusively  relied upon by any  prospective  purchaser or encumbrancer of
     the Premises or of the business of the requesting party.
(b)  At the  requesting  party's  option,  the failure to deliver such statement
     within such time shall be  material  default of this Lease by the party who
     is to respond,  without any  further  notice to such party,  or it shall be
     conclusive upon such party that (i) this Lease is in full force and effect,
     without  modification except as may be represented by the requesting party,
     (ii) there are not uncured defaults in the requesting party's  performance,
     and (iii) if Lessor is the requesting party, not more than one month's rent
     has been paid in advance.
(c)  If Lessor desires to finance,  refinance, or sell the Industrial Center, or
     any part  thereof,  Lessee  hereby  agrees  to  deliver  to any  lender  or
     purchaser  designated by Lessor such financial  statements of Lessee as may
     be reasonably  required by such lender or purchaser.  Such statements shall
     include the past three (3) years' financial  statements of Lessee. All such
     financial  statements  shall be  received  by  Lessor  and such  lender  or
     purchaser in confidence and shall be used only for the purposes  herein set
     forth.
17.  Lessor's  Liability.  The term  "Lessor" as used herein shall mean only the
     owner or owners,  at the time in  question,  of the fee title or a lessee's
     interest  in a  ground  lease  of the  Industrial  Center,  and  except  as
     expressly  provided in  paragraph  15, in the event of any transfer of such
     title or  interest.  Lessor  herein  named  (and in case of any  subsequent
     transfer  than the  grantor)  shall be relieved  from and after the date of
     such transfer of all liability as respects Lessor's obligations  thereafter
     to be performed, provided that any funds in the hands of Lessor or the then
     grantor at the time of such  transfer,  in which  Lessee  has an  interest,
     shall be delivered to the grantee. The obligations  contained in this Lease
     to be  performed  by Lessor  shall,  subject as  aforesaid,  the binding on
     Lessor's  successors and assigns,  only during their respective  periods of
     ownership.

18.  Severability.  The  invalidity of any provision of this Lease as determined
     by a court of competent  jurisdiction,  shall in no way affect the validity
     of any other provision hereof.

19.  Interest on Past-due Obligations.  Except as expressly herein provided, any
     amount due to Lessor not paid when due shall bear  interest  at the Default
     Rate from the date due.  Payment of such interest  shall not excuse or cure
     any default by Lessee under this Lease;  provided,  however,  that interest
     shall not be payable on late charges  incurred by Lessee nor on any amounts
     upon which late charges are paid by Lessee.

20.  Time of Essence.  Time is of the essence with respect to the obligations to
     be performed under this Lease.

21.  Additional  Rent.  All monetary  obligations  of Lessee to Lessor under the
     terms  of this  Lease,  including  but not  limited  to  Lessee's  Share of
     Operating  Expenses and insurance and tax expenses  payable shall be deemed
     to be rent.

22.  Incorporation  of Prior  Agreements;  Amendments.  This Lease  contains all
     agreements of the parties with respect to any matter mentioned  herein.  No
     prior or contemporaneous  agreement or understanding pertaining to any such
     matter  shall be  effective.  This lease may be modified  in writing  only,
     signed by the parties in interest at the time of the  modification.  Except
     as otherwise stated in this Lease,  Lessee hereby acknowledges that neither
     the real estate  broker  listed in paragraph 15 hereof nor any  cooperating
     broker on this  transaction nor the Lessor or any employee or agents of any
     of said persons has made an oral or written  warranties or  representations
     to Lessee relative to the condition or use by Lessee of the Premises or the
     Industrial   Center  and  Lessee   acknowledges  that  Lessee  assumes  all
     responsibility  regarding to Occupational  Safety Health Act, the legal use
     and  adaptability  of the  Premises  and the  compliance  thereof  with all
     applicable  laws and  regulations  in effect  during the term of this Lease
     except as otherwise specifically stated in this Lease.

23.  Notices. Any notice required or permitted to be given hereunder shall be in
     writing and may be given by personal  delivery or by certified mail, and if
     given  personally  or by  mail,  shall  be  deemed  sufficiently  given  if
     addressed to Lessee or to Lessor at the address  noted below the  signature
     of the respective  parties,  as the case may be. Either party may by notice
     to the other specify a different address for notice purposes. A copy of all
     notices  required or  permitted  to be given to Lessor  hereunder  shall be
     concurrently  transmitted  to such party or parties  at such  addresses  as
     Lessor may from time to time hereafter designate by notice to Lessee.

24.  Waivers.  No waiver by Lessor  or any  provision  hereof  shall be deemed a
     waiver of any other provision hereof or of any subsequent  breach by Lessee
     of the same or any other  provision.  Lessor's  consent to, or approval or,
     any act shall not be deemed to render unnecessary the obtaining of Lessor's
     consent to or approval of any subsequent  act by Lessee.  The acceptance of
     rent  hereunder by Lessor shall not be a waiver of any preceding  breach by
     Lessee of any provision hereof, other than the failure of Lessee to pay the
     particular  rent so  accepted,  regardless  of Lessor's  knowledge  of such
     preceding breach at the time of acceptance of such rent.

25.  Recording.  Either  Lessor or Lessee  shall,  upon  request  of the  other,
     execute,  acknowledge and deliver to the other a "short form" memorandum of
     this Lease for recording purposes.

26.  Holding Over. If Lessee,  with Lessor's  consent,  remains in possession of
     the Premises or any part thereof  after the  expiration of the term hereof,
     such  occupancy  shall  be a  tenancy  from  month  to  month  upon all the
     provisions of this Lease  pertaining to the obligations of Lessee,  but all
     Options,  if any,  granted  under the terms of this  Lease  shall be deemed
     terminated and be of no further effect during said month to month tenancy.

27.  Cumulative  Remedies.  No  remedy  or  election  hereunder  shall be deemed
     exclusive  but  shall,  wherever  possible,  be  cumulative  with all other
     remedies at law or in equity.

28.  Covenants  and  Conditions.  Each  provision of this Lease  performable  by
     Lessee shall be deemed both a covenant and a condition.

29.  Binding Effect: Choice of Law. Subject to any provisions hereof restricting
     assignment  or  subletting  by Lessee  and  subject  to the  provisions  of
     paragraph   17,  this  Lease  shall  bind  the  parties,   their   personal
     representatives,  successors  and assigns.  This Lease shall be governed by
     the laws of the  State  where the  Industrial  Center  is  located  and any
     litigation  concerning  this Lease  between  the  parties  hereto  shall be
     initiated in the county in which the Industrial Center is located.

30.  Subordination.

(a)  This Lease,  and any Option granted hereby,  at Lessor's  option,  shall be
     subordinate  to any ground  lease,  mortgage,  dead of trust,  or any other
     hypothecation  or security  now or  hereafter  placed  upon the  Industrial
     Center and to any and all advances made on the security  thereof and to all
     renewals,  modifications,   consolidations,   replacements  and  extensions
     thereof. Provided any future mortgagee executes a non-disturbance agreement
     substantially  similar to the example  shown in Exhibit D attached  hereto.
     Notwithstanding  such subordination,  Lessee's right to quiet possession of
     the Premises shall not be disturbed if Lessee is not in default and so long
     as Lessee shall pay the rent and observe and perform all of the  provisions
     of this Lease,  unless this Lease is otherwise  terminated  pursuant to its
     terms. If any mortgagee,  trustee or ground lessor shall elect to have this
     Lease and any Options  granted  hereby  prior to the lion of its  mortgage,
     dead of trust or ground  lease,  and shall give written  notice  thereof to
     Lessee, this Lease and such Options shall be deemed prior to such mortgage,
     deed of trust or ground lease, whether this Lease or such Options are dated
     prior or subsequent to the date of said  mortgage,  deed of trust or ground
     lease or the date of recording thereof.
(b)  Lessee  agrees  to  execute  any   documents   required  to  effectuate  an
     attornment,  a  subordination  or to make this Lease or any Option  granted
     herein prior to the lion of any mortgage, deed of trust or ground lease, as
     the case may be. Lessee's failure to execute such documents within ten (10)
     days after  written  demand shall  constitute a material  default by Lessee
     hereunder  without further notice to Lessee or, at Lessor's option,  Lessor
     shall   execute   such   documents   on  behalf   of  Lessee  as   Lessee's
     attorney-in-fact.  Lessee  does hereby  make,  constitute  and  irrevocably
     appoint Lessor as Lessee's  attorney-,in-fact  and in Lessee's name,  place
     and stead,  to execute such  documents in  accordance  with this  paragraph
     30(b).

31.  Attorney's  Fees. If either party or the broker(s) named herein
     bring an action to enforce the terms  hereof or declare  rights  hereunder,
     the  prevailing  party in any such  action,  on trial or  appeal,  shall be
     entitled to his reasonable  attorney's  fees to be paid by the losing party
     as fixed by the court.  The provisions of this paragraph shall inure to the
     benefit of the broker named herein who seeks to enforce a right hereunder.

32.  Lessor's  Access,   Lessor  and  Lessor's  agents  shall,   upon  providing
     twenty-four  24  hours  notice  to  Lessee.  have the  right to enter the
     Premises  at  reasonable  times for the  purpose  of  inspecting  the same,
     showing the same to prospective purchasers, lenders, or lessees, and making
     such alterations,  repairs, improvements or additions to the Premises or to
     the Industrial Center as Lessor may deem necessary or desirable. Lessor may
     at any time place on or about the  Premises or the  Building  any  ordinary
     "For Sale" signs and Lessor may at any time during the last 120 days of the
     term hereof place on or about the Premises any ordinary  "For Lease" signs.
     All  activities  of Lessor  pursuant  to this  paragraph  shall be  without
     abatement of rent,  nor shall  Lessor have any  liability to Lessee for the
     same.

33.  Auctions.  Lessee shall not  conduct,  nor permit to be  conducted,  either
     voluntarily or  involuntarily,  any auction upon the Premises or the Common
     Areas  without  first  having  obtained  Lessor's  prior  written  consent.
     Notwithstanding anything to the contrary in this Lease, Lessor shall not be
     obligated to exercise any standard of reasonableness in determining whether
     to grant such consent.

34.  Signs.  Lessee shall not place any sign upon the Premises or the Industrial
     Center without Lessor's prior written consent. Under no circumstances shall
     Lessee  place a sign on any roof of the  Industrial  Center.  See  Addendum
     Paragraph 54.

35. Merger. The voluntary or other surrender of this Lease by
     Lessee, or a mutual cancellation thereof, or a termination by Lessor, shall
     not work a merger, and shall, at the option of Lessor, terminate all or any
     existing  subtenancies  or may,  at the  option of  Lessor,  operate  as an
     assignment to Lessor of any or all of such subtenancies.

36.  Consents.  Except  for  paragraph  33  hereof,  wherever  in this Lease the
     consent of one party is required to an act of the other party such  consent
     shall not be unreasonably withhold or delayed.

37.  Guarantor.  In the event  that there is a  guarantor  of this  Lease,  said
     guarantor shall have the same obligations as Lessee under this Lease.

38.  Quiet  Possession.  Upon  Lessee  paying  the  rent  for the  Premises  and
     observing and performing all of the covenants, conditions and provisions on
     Lessee's  part to be observed and  performed  hereunder,  Lessee shall have
     quiet  possession of the Premises for the entire term hereof subject to all
     of the provisions of this Lease.  The  individuals  executing this Lease on
     behalf of  Lessor  represent  and  warrant  to  Lessee  that they are fully
     authorized and legally  capable of executing this Lease on behalf of Lessor
     and that such  execution is binding  upon all parties  holding an ownership
     interest in the Property.

39.  Options.

39.1 Definition.  As used in this  paragraph the word "Option" has the following
     meaning:  (1) the right or option  to extend  the term of this  Lease or to
     renew  this  Lease to extend or renew any lease  that  Lessee  has on other
     property of Lessor;  (2) the option or right of first  refusal to lease the
     Premises or the right of first offer to lease the  Premises or the right of
     first  refusal to lease other space within the  Industrial  Center or other
     property of Lessor or the right of first offer to lease other space  within
     the Industrial Center or other property of Lessor;  (3) the right or option
     to purchase the Premises or the  Industrial  Center,  or the right of first
     refusal to purchase the Premises or the industrial  Center, or the right of
     first offer to purchase the Premises or the Industrial Center, or the right
     or option to  purchase  other  property  of  Lessor,  or the right of first
     refusal to purchase other property of Lessor or the right of first offer to
     purchase other property of Lessor.

39.2 Options  Personal.  Each Option granted to Lessee in this Lease is personal
     to the  original  Lessee and may be exercised  only by the original  Lessee
     while  occupying  the Premises who does so without the intent of thereafter
     assigning this Lease or subletting the Premises or any portion thereof, and
     may not be exercised or be assigned,  voluntarily, or involuntarily,  by or
     to any  person or entity  other than  Lessee,  provided,  however,  that an
     Option may be exercised  by or assigned to any Lessee  Affiliate as defined
     in paragraph  12.2 of this Lease.  The Options,  if any,  herein granted to
     Lessee are not assignable  separate and apart from this Lease,  nor may any
     Option be separated from this Lease in any manner, either by reservation or
     otherwise.

39.3 Multiple  Options.  In the event that  Lessee has any  multiple  options to
     extend or renew this Lease a later option  cannot be  exercised  unless the
     prior option to extend or renew this Lease has been so exercised.

39.4 Effect of Default on Options.

(a)  Lessee  shall  have no right to  exercise  an Option,  notwithstanding  any
     provision  in the grant of  Option to the  contrary,  (i)  during  the time
     commencing  from  the date  Lessor  gives to  Lessee  a notice  of  default
     pursuant  to  paragraph  13.1  (b) or 13.1  (c) and  continuing  until  the
     noncompliance  alleged in said  notice of default is cured,  or (ii) during
     the period of time  commencing  on the date after a monetary  obligation to
     Lessor is due from  Lessee and unpaid  (without  any  necessity  for notice
     thereof to Lessee) and  continuing  until the obligation is paid, off (iii)
     at any time after an event of default  described  in  paragraphs  13.1 (a),
     13.1 (d), or 13.1 (a)  (without  any  necessity of Lessor to give notice of
     such  default to  Lessee),  or (iv) in the event  that  Lessor has given to
     Lessee  three or more  notices  of default  under  paragraph  13.1 (b),  or
     paragraph  13.1 (c),  whether or not the defaults are cured,  during the 12
     month period of time immediately  prior to the time that Lessee attempts to
     exercise the subject Option.
(b)  The period of time  within  which an Option may be  exercised  shall not be
     extended or enlarged by reason of Lessee's  inability to exercise an Option
     because of the provisions of paragraph 39.4(a).
(c)  All rights of Lessee under the provisions of an Option shall  terminate and
     be of no further force or effect,  notwithstanding  Lessee's due and timely
     exercise of the Option, if, after such exercise and during the term of this
     Lease,  (i) Lessee fails to pay to Lessor a monetary  obligation  of Lessee
     for a period of thirty (30) days after such obligation becomes due (without
     any necessity of Lessor to give notice  thereof to Lessee),  or (ii) Lessee
     fails to commence to cure a default  specified in paragraph  13.1(c) within
     thirty (30) days after the date that Lessor  gives notice to Lessee of such
     default and/or Lessee fails thereafter to diligently prosecute said core to
     completion,  or (iii) Lessee commits a default described in paragraphs 13.1
     (a),  13.1 (d) or 13.1 (a) (without any  necessity of Lessor to give notice
     of such  default to Lessee),  or (iv) Lessor  gives to Lessee three or more
     notices of default under paragraph 13.1 (b), or paragraph 13.1 (c), whether
     or not the  defaults  are  cured.

40.  Security  Measures.  Lessee hereby  acknowledges  that Lessor shall have no
     obligation  whatsoever to provide guard service or other security  measures
     for the benefit of the Premises or the  Industrial  Center.  Lessee assumes
     all  responsibility  for the protection of Lessee, its agents, and invitees
     and the property of Lessee and of Lessee's agents and invitees from acts of
     third parties.  Nothing herein contained shall prevent Lessor,  at Lessor's
     sole option,  from providing security  protection for the Industrial Center
     or any part  thereof,  in which  event the cost  thereof  shall be included
     within the definition of Operating Expenses, as set forth in paragraph 4.2.

41.  Easements. Lessor reserves to itself the right, from time to time, to grant
     such  easements,  rights and  dedications  that Lessor  deems  necessary or
     desirable, and to cause the recordation of Parcel Maps and restrictions, so
     long as such easements,  rights, dedications,  Maps and restrictions do not
     unreasonably interfere with the use of the Premises by Lessee. Lessee shall
     sign any of the aforementioned documents upon request of Lessor and failure
     to do so shall  constitute  a  material  default  of this  Lease by  Lessee
     without the need for further notice to Lessee.

42.  Performance  Under Protest.  If at any time a dispute shall arise as to any
     amount  or sum of money  to be paid by one  party to the  other  under  the
     provisions  hereof,  the party against whom the obligation to pay the money
     is asserted shall have the right to make payment,  under protest,  and such
     payment  shall not be  regarded  as a  voluntary  payment,  and there shall
     survive  the  right on the  part of said  party to pay such sum or any part
     thereof,  said  party  shall be  entitled  to  recover  such sum or so much
     thereof as it was not legally  required to pay under the provisions of this
     Lease.

43.  Authority.  If  Lessee  is a  corporation,  trust  or  general  or  limited
     partnership,  each individual executing this Lease on behalf of such entity
     represents  and warrants  that he or she is duly  authorized to execute and
     deliver  this Lease on behalf of said  entity.  If Lessee is a  corporation
     trust or partnership, Lessee shall, within thirty (30) days after execution
     of this Lease, deliver to Lessor evidence of such authority satisfactory to
     Lessor.

44.  Conflict. Any conflict between the printed provisions of this Lease and the
     typewritten or handwritten  provisions,  if any, shall be controlled by the
     typewritten or handwritten provisions.

45.  Offer. Preparation of this Lease by Lessor or Lessor's agent and submission
     of same to Lessee  shall not be deemed an offer to lease.  This Lease shall
     become  binding  upon Lessor and Lessee only when fully  executed by Lessor
     and Lessee.

46.  Addendum.  Attached hereto is an addendum or addenda containing  paragraphs
     47 through 59 which constitute a part of this Lease.


LESSOR AND LESSEE HAVE  CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISIONS CONTAINED HEREIN AND, BY EXECUTION OF THIS LEASE, SHOW THEIR INFORMED
AND VOLUNTARY  CONSENT THERETO.  THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS
LEASE IS  EXECUTED,  THE TERMS OF THIS  LEASE ARE  COMMERCIALLY  REASONABLE  AND
EFFECTUATE  THE INTENT AND  PURPOSE  OF LESSOR  AND LESSEE  WITH  RESPECT TO THE
PREMISES.  THIS LEASE HAS BEEN  PREPARED  FOR  SUBMISSION  TO YOUR  ATTORNEY FOR
APPROVAL. NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN INDUSTRIAL
REAL ESTATE  ASSOCIATION OR BY THE REAL ESTATE BROKER OR ITS AGENTS OR EMPLOYEES
AS TO THE LEGAL  SUFFICIENCY,  LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEAS OR
THE TRANSACTION  RELATING THERETO: THE PARTIES SHALL RELY SOLELY UPON THE ADVICE
OF THEIR OWN LEGAL COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE.


<TABLE>

<CAPTION>
                 LESSOR                                                          LESSEE
     <S>                                                            <C>

     Transcontinental Realty Investors,                             West Capital Financial Services Corp.,
     a California BusinessTrust                                     a California  Corporation

     By:  _____/s/ David W. Starowicz                               By:  ______/s/ Michael A. Joplin
          David W. Starowicz, Vice President                             Michael A. Joplin
                                                                         President and Chief Executive Officer

     By:  _____________________________                             By:  ______________________________


     Executed on________9/15/94                                     Executed on________9/13/94
               (Corporate Seal)                                               (Corporate Seal)


     ADDRESS FOR NOTICES AND RENT                                   ADDRESS

     John Burnham & Company                                         3111 Camino del Rio North, Suite 200
     Attn:  Real Estate Management                                  San Diego, CA  92108

     P.O. Box 2910, San Diego, California  92112                    Address after September 1994:

                                                                    5775 Roscoe Court, San Diego, California 92123



</TABLE>








(R) 1982 -By American Industrial Real Estate  Association.  All rights reserved,
No part of these  words may be  reproduced  in any form  without  permission  in
writing.  For these forms write the American Industrial Real Estate Association,
350 South Figueroa Street, Suite 275, Los, CA 90071 (213) 687-8777

<PAGE>






           ADDENDUM TO STANDARD INDUSTRIAL LEASE -MULTI TENANT -GROSS


This  ADDENDUM is an addition to and an  amendment  to that Lease dated June 24,
1994 between  TRANSCONTINENTAL REALTY INVESTORS,  INC., Lessor, and WEST CAPITAL
FINANCIAL SERVICES CORPORATION, Lessee. In the event of any conflict between any
provision  in the Lease and a  section  in this  Addendum,  the  Addendum  shall
govern.

47. RENTAL RATE: The monthly rent payable under Paragraph 4 shall be:
<TABLE>


<S>               <C>                       <C>

                  Months 01 & 07-12         -$27,628.40 Per Month
                  Months 13-24              -$28457.25  Per Month
                  Months 25-36              -$29,310.97 Per Month
                  Months 37-48              -$30,190.30 Per Month
                  Months 49-60              -$31,096.00 Per Month
</TABLE>

48. RENTAL ABATEMENT: So long as Lessee faithfully performs all of the terms and
conditions of the lease,  Lessor hereby agrees to abate  Lessee's  obligation to
pay the base rent for the second (2nd) through sixth (6th) lease months.

49.  RECIPROCAL  RIGHTS:  Lessee  acknowledges  that all driveways,  parking and
loading areas (not including loading docks and any designated parking spaces) in
the  complex  are to be used in common with other  tenants in the  Complex,  and
their guests,  customers, and suppliers, and that none of the said areas are for
the exclusive use of Lessee.

50. HAZARDOUS MATERIALS:  The term "Hazardous Materials",  as used in this Lease
shall mean pollutants,  contaminants,  toxic or hazardous  wastes,  or any other
substances,  the use and/or the removal of which is required or the use of which
is restricted,  prohibited or penalized by an  "Environmental  Law",  which term
shall mean any federal,  state,  or local law,  ordinance or other  statute of a
governmental or quasi-governmental authority relating to pollution or protection
of the environment.  Lessee hereby agrees that (i) no activity will be conducted
on the  Premises  that will  produce any  Hazardous  Substance,  except for such
activities that are part of the ordinary course for Lessee's business activities
(the "Permitted Activities") provided said Permitted Activities are conducted in
accordance  with all  Environmental  Laws and have been  approved  in advance in
writing by Lessor;  Lessee  shall be  responsible  for  obtaining  any  required
permits  and  paying  any  fees  and  providing  any  testing  required  by  any
governmental  agency,  (ii) the Premises  will not be used in any manner for the
storage of any  Hazardous  Substances  except for the storage of such  materials
that  are  used  in  the  ordinary  course  of  Lessee's  business   ("Permitted
Materials")  provided such Permitted  Materials are properly  stored in a manner
and location meeting all  Environmental  Laws and approved in advance in writing
by Lessor;  Lessee shall be responsible  for obtaining any required  permits any
paying any fees and providing any testing required by any  governmental  agency;
(iii) no portion of the  Premises  will be used as a  landfill  or a dump;  (iv)
Lessee will not install any  underground  tanks of any type; (v) Lessee will not
allow any surface or subsurface  conditions to exist or come into existence as a
result of Lessee's  actions or the  conduct of  Lessee's  business on the Leased
Premises that  constitute or with the passage of time may constitute a public or
private  nuisance;  (vi) Lessee will not permit any  Hazardous  Substances to be
brought onto the Premises,  except for the Permitted  Materials described below,
or  hereafter  approved in writing by Lessor and if so brought or found  located
thereon,  the same shall be immediately removed,  with proper disposal,  and all
required  cleanup  procedures  shall be  diligently  undertaken  pursuant to all
Environmental Laws. Lessor or Lessor's  representative  shall have the right but
not the  obligation  to enter the Premises for the  purposes of  inspecting  the
storage,  use and disposal of Permitted  Materials to ensure compliance with all
Environmental Laws. Should it be determined, in Lessor's sole opinion, that said
Permitted  Materials  are being  improperly  stored,  used, or disposed of, then
Lessee shall immediately take such corrective action with 24 hours, Lessor shall
have the right to perform such work and Lessee shall promptly  reimburse  Lessor
for any and all costs  associated with said work. If at any time during or after
the term of the Lease,  the Premises are found to be so  contaminated or subject
to said conditions, and such contamination is caused by Lessee or the conduct of
its business on the Leased Premises,  Lessee shall  diligently  institute proper
and thorough  cleanup  procedures  at Lessee's  sole cost,  and Lessee agrees to
indemnify,  save and hold Lessor harmless from all and against claims,  demands,
actions,  liabilities,  costs,  expenses,  damages and obligations of any nature
arising from or as a result of the use of the Premises by Lessee, and regardless
of  whether  or not  Lessor  is found to be  solely,  concurrently,  or  jointly
negligent with Lessee. The foregoing indemnification and the responsibilities of
Lessee shall  survive the  termination  or  expiration  of this Lease.  Anything
contained herein to the contrary notwithstanding,  Lessor shall not unreasonably
withhold  its  consent  with  respect  to  the  use,   storage,   generation  or
manufacturing of Hazardous  Substances on or about the Leased Premises  provided
same is done in the ordinary course of Lessee's business, and in compliance with
all environmental laws.

Lessor  represents and warrants to Lessee that Lessor, at Lessor's sole cost and
expense,  will  cause  Lessee's  Premises  to be in  full  compliance  with  any
governmental laws,  ordinances,  regulations or orders relating to environmental
conditions on, under or about Lessee's Premises ("Regulations"),  including, but
not  limited  to,  asbestos,  soil and ground  water  conditions  and  Hazardous
Materials  (defined below),  and Lessor shall defend,  indemnify and hold Lessee
harmless  from and  against  any and all  Lessee,  costs  (including  reasonable
attorneys'  fees),  liabilities  and claims arising from the violation of any of
the  Regulations  that may  affect  Lessee's  Premises  and  shall  assume  full
responsibility and cost to remedy such violations,  provided that the violations
are not caused by  Lessee.  Neither  Lessor  nor  Lessee  shall at any time use,
generate,  store or dispose of on, under or about Lessee's Premises or transport
to or from the same any hazardous wastes,  toxic substances or related materials
("Hazardous  Materials")  or permit or allow any  third-party  to do so, without
compliance with all Regulations.  Hazardous  Materials shall include,  but shall
not be limited  to,  substances  defined  as  "hazardous  substances"  or "toxic
substances"  in  the  Comprehensive  Environmental  Response,  Compensation  and
Liability  Act  of  1980,  as  amended,  42  U.S.C.A.   ss.1802;  the  Resource,
Conservation  Recovery Act, 42 U.S.C.A.  ss.6901,  et. seq.; or those substances
defined as "hazardous wastes" in applicable codes in the State of California and
in the regulations adopted and publications promulgated to such codes.

51. OUTSIDE STORAGE:  No storage will be allowed outside the building nor on any
of the common areas such as landscaping,  driveways,  parking lots,  fences, and
all sidewalks and parkways adjacent to the Premises.  This includes,  but is not
limited to, supplies,  materials,  goods,  pallets,  dunnage, and equipment.  No
vehicles,  including  boats and  trailers,  may be parked or stored  outside the
building  overnight.  Violation of this  provision  shall  constitute a material
breach of this Lease.

52. OUTSIDE WORK: No work shall be permitted on the sidewalks,  roofs,  streets,
driveways,  parking or landscaped areas.  This includes,  but is not limited to,
assembly,  construction,  mechanical work, painting, drying, outlying, cleaning,
or repair of goods or materials.  Violation of this provision shall constitute a
material breach of this Lease.

53.  COVENANTS,  CONDITIONS AND  RESTRICTIONS:  Lessor hereby  acknowledges that
Lessor has received and approved the declaration of covenants,  conditions,  and
restrictions for Chesapeake Ridge, San Diego,  California  identified in Exhibit
"B" attached hereto and agrees to this obligation  hereunder.  Any violations of
this  provision  shall  constitute  a  material  default  of this  Lease  or any
extension or assignment of this Lease thereof.

<PAGE>

54. SIGNAGE: Lessee shall place no exterior signs on or about the Premises or on
the grounds  surrounding the Premises  without  Lessor's prior written  consent.
Lessee  agrees to remove any signs and return  the face of the  building  to its
original condition, fair wear and tear excepted, upon expiration of the Lease or
any extension thereof.

55.  OPTION TO RENEW:  Lessee shall have the option to renew the Lease,  for all
space in the Building,  for one (1) additional term of five (5) years upon first
giving Lessor nine (9) months prior written  notice of its intention to exercise
such option. The rental rate for the renewal term will be the then net effective
market rental rate currently being granted by Lessors of comparable buildings to
new  lessees.  Lessee shall be informed in writing of Lessor's  proposed  rental
three (3) months prior to such time that notification by Lessee is required. The
Base Year for purposes of calculating  escalation shall adjust to the first year
of the renewal term and shall be projected as if the Project is fully occupied.

Definition  of Fair  Market  Value:  With  respect to the  renewal  option,  the
applicable  "fair market value" rental rate shall be that rate  (determined on a
.,gross"  lease  basis)  charged  for space of  comparable  size and  conditions
adjusted to reflect location in the Building,  further taking into consideration
the following:

a.   definition of "rentable area";
b.   location, quality, and age of the leasehold improvements;
c.   extent of leasehold improvements (existing, other than those then in
     Lessee's then existing premises, or to be provided);
d.   abatements (including with respect to base rental, operating expenses, real
     estate taxes, and parking charges);
e.   relocation/moving allowances;
f.   space planning allowances;
g.   any other concessions or inducements;
h.   extent of services provided or to be provided;
i.   base year or stop amount for escalation  purposes (both operating  expenses
     and real estate taxes);
j.   any other  adjustments  (including by way of Consumer  Price Index or other
     indexes to base rental);
k.   credit standing and financial stature of the lessee;
l.   term of lease;
m.   the time the particular rental rate under consideration was agreed upon and
     became or is to become effective;
n.   the payment of a leasing commission and/or fees or bonuses in lieu thereof,
     whether to Lessor or any person or entity affiliated with Lessor; and
o.   any other  relevant  term or condition  in making such "fair market  value"
     rental rate determination.

56. UTILITIES: Lessee shall be responsible for its share of electrical servicing
the  leased  premises.  Lessee  hereby  agrees  to pay  metered  expenses  as so
determined.

57. INTERRUPTION OF ESSENTIAL SERVICES: Notwithstanding anything in the Lease to
the  contrary,  if any  services  which are  essential  to  Lessee's  use of the
Premises (such as use of the Parking  Spaces,  HVAC, as necessary for reasonable
access,  electricity  and/or water,  telephone  service [if the  interruption in
telephone  service is attributable to causes within Lessor's  control) which are
supplied by Lessor ("essential services") are interrupted, and such interruption
is caused by circumstances  under Lessor's control,  Lessee shall be entitled to
an  abatement  of Base Rent and the  additional  rent if and to the extent  that
Lessee ceases doing business in the Premises on account  thereof.  The abatement
shall begin on the fifth (5th)  consecutive  business day after the interruption
commences and shall end when services have been  restored.  In addition,  if any
essential  services are interrupted and  interruption is caused by circumstances
under Lessor's control for a


<PAGE>


substantial  period during Normal  Business Hours on more than ten (10) business
days during any consecutive twelve (12) months, then Lessee shall be entitled to
an abatement of Base Rent and additional  rent charged if and to the extent that
Lessee ceases doing business in the Premises on account of such  interruption on
any  additional  business  days during such  12-month  period,  Lessee agrees to
promptly  notify  Lessor  and any  Superior  Mortgagee  of any  interruption  of
essential  services and any Rent abatement claimed by Lessee on account thereof.
Notwithstanding  anything  elsewhere to the contrary,  Lessee may terminate this
Lease  without  liability  to either  party if Lessee  has given  notice of such
interruption to Lessor and any Superior  Mortgagee within thirty (30) days after
the interruption commenced and are interrupted for ninety (90) or more days, and
such  interruption is caused by circumstances  under Lessor's  control,  and the
essential  services to be provided by Lessor are  interrupted for ninety (90) or
more  consecutive  days  provided  that Lessee gives notice of such  election to
terminate before the essential services have been restored.  Notwithstanding the
foregoing,  Lessee may not terminate this Lease and shall not be entitled to any
abatement of rent if the  interruption  of essential  services was caused by the
negligence or willful misconduct of Lessee or Lessee's Representatives.

58. TRUST EXCULPATION:  The Lessor under this Lease is  Transcontinental  Realty
Investors,  Inc.  ("Trust").  The  Declaration(s)  of Trust provide that (a) the
Trustee shall conduct the Trust's  activities in the name of the Trust,  (b) the
name of the Trust  refers to the  Trustees  collectively  as  trustees,  but not
individually or personally, (c) no trustee,  shareholder,  officer, employee, or
agent  shall  have  any  personal  liability,  jointly  or  severally,  for  any
obligation of or claim against the Trust,  and (d) all persons  dealing with the
Trust,  in any way,  must look solely to the assets of the Trust for the payment
of any claims  against the Trust.  Accordingly,  Lessee agrees to look solely to
the  respective  assets of the Trust for the  enforcement  of any claims against
Lessor.

59.  OPERATING  EXPENSES:   The  following  provisions  are  made  part  of  the
above-referenced  Lease.  In the event of any  conflict  between the Basic Lease
Terms and/or  General Terms,  Covenants and  Conditions  and this Addendum,  the
latter shall prevail.  The capitalized  terms not defined in this Addendum shall
have the same meaning as in the Lease.

Escalation.  The Base Rent does not  anticipate  any  increase  in the amount of
taxes on the Building,  the Land,  any  improvements  situated  thereon,  or any
Leasehold  Improvements  (together hereinafter referred to as the "Property") or
in the cost of operations and maintenance thereof.  Therefore, in order that the
Rent payable  throughout the Term shall reflect any such increases,  the parties
agree as hereinafter in this Addendum set forth.

(a)  Commencing  on the  expiration  of the Base Year and for each  year  (i.e.,
     12-month  period)  thereafter  (hereinafter  referred  to as a  "Comparison
     Year"),  Lessee shall pay Lessor an amount equal to Lessee's  Proportionate
     Share of the total Real  Expenses  (as  hereinafter  defined)  incurred  by
     Lessor for or during such  Comparison Year in excess of the total amount of
     Real Estate  Taxes and  Operating  Expenses  payable by Lessor for the Base
     Year (such excess hereinafter  referred to as the "Excess  Expenses").  (By
     way of example,  if the Commencement  Date were September 7, 1994, the Base
     Year would be October 1, 1994 through  September  30,  1995,  and the first
     Comparison Year would be October 1, 1995 through September 30, 1996.)

(b)  (i) "Real Estate Taxes" shall mean and include: (1) all general and special
     taxes,  assessments,  duties and levies,  if any,  payable  (adjusted after
     protest  or  litigation,  if any) for any part of the  Term,  exclusive  of
     penalties or  discounts,  on the  Properties;  (2) Any taxes which shall be
     levied on the rentals of the Building in lieu of any such Real Estate Taxes
     in whole or in part; (3) the  reasonable  expenses of contesting the amount
     or validity of any such taxes,  charges or assessments,  such expense to be
     applicable to the period of the item contested,  provided Lessor reasonably
     anticipated a reduction of Operating Expenses.  During the first sixty (60)
     months of the initial  Term, in the event of a  reassessment  under Article
     XIII(A) of the  California  Constitution  (Proposition  13") by reason of a
     change in ownership and/or refinancing of the Land,  Building,  or Project,
     Lessee shall not be required to pay any increase in Lessee's  Proportionate
     share of Excess Expenses attributable to such reassessment. All Real Estate
     Taxes  (except  those  specifically  charged to Lessee  because of Lessee's
     actions) which shall only be included in Excess Expenses to the extent such
     amounts would be payable if Lessor elected to pay such Real Estate Taxes in
     the maximum number of installments permitted,  even if Lessor elects to pay
     the same in a lump sum.

     (ii) "Operating Expenses" shall mean all expenses reasonably paid or
     incurred by Lessor or on Lessor's behalf in respect of the  management,
     repair, operation  and  maintenance  of  the  Land  and  Building,
     determined  in     accordance  with  generally  accepted  accounting
     principles  consistently  applied, including: (1) salaries, wages and
     benefits of employees of Lessor     to the extent engaged in the on-site
     management  (and off-site  management    [with job  description  equivalent
     of  building  manager  or below] to the  extent and in an amount  directly
     attributable  to the  Project),  repair,     operation  and  maintenance
     of the Land and Building;  (2) payroll  taxes,
     workmen's  compensation,  uniforms  and related  expenses  for such on-site
     employees (and off-site  employees to the extent and in an amount  directly
     attributable  to the  Project);  (3) the cost of all charges for oil,  gas,
     steam,  electricity,  any alternate  source of energy,  heat,  ventilation,
     air-conditioning,  water,  sewers and other utilities furnished to the Land
     and  Building  (including  the  Common  Areas and  leased  areas  thereof),
     together  with  any  taxes  on such  utilities;  (4) the  cost of  painting
     non-tenant space; (5) the cost of all charges for rent, casualty, liability
     and  fidelity  insurance  with  regard  to the  Land and  Building  and the
     maintenance or operation thereof;  (6) the cost of all supplies  (including
     cleaning supplies),  tools, materials and equipment, the rental thereof and
     sales and other taxes  thereon;  (7)  depreciation  of hand tools and other
     movable  equipment  used in the repair,  operation  or  maintenance  of the
     Building  up to a maximum or $2500 per year  (cumulative);  (8) the cost of
     all  charges  for  window  and other  cleaning,  janitorial,  and  security
     services;  (9)  repairs  made by Lessor at its  expense;  (10)  charges  of
     independent  contractors;  (11 ) exterior  and interior  landscaping;  (12)
     whether or not capitalized under generally accepted accounting  principles,
     costs  for  alterations  and  improvements  made by  reason of the laws and
     requirements  enacted  after  the  signing  of  this  Lease  of any  public
     authorities  (except for any capital  items  which are  required  under the
     general   regulatory   framework  of  Title  III  of  the  Americans   With
     Disabilities  Act ("ADA") and which are specifically  required  pursuant to
     state or local laws which are  enacted  after the  signing of this Lease to
     implement the previously enacted requirements of Title III of the ADA as to
     Building  and Common  Areas;  except  that  Lessee  shall pay all costs for
     compliance with the ADA within the Premises) or the reasonable requirements
     of insurance  bodies  generally  after the  reasonable  useful life of such
     alterations and improvements; (13) management fees or, if no managing agent
     is employed by Lessor,  a sum in lieu thereof which is not in excess of the
     then  prevailing  rates for  management  fees of other first  class  office
     buildings in the San Diego suburban area; (14) [Deleted];  (15) the cost of
     replacements, improvements or additions, and of any machinery or equipment,
     which are made or become  operational,  as the case may be,  whether or not
     capitalized under generally accepted accounting principles, during the Term
     and which have the effect of reducing the expenses which otherwise would be
     included  in  Operating  Expenses  to the  extent of the lesser of (A) such
     cost, as amortized by Lessor over anticipated  useful life with interest on
     the  unamortized  amount at the rate  actually  paid by Lessor,  or (B) the
     amount of such  reduction in Operating  Expenses;  (16)  reasonable  legal,
     accounting  and other  professional  fees incurred in  connection  with the
     operation,  maintenance  and  management  of the Land and  Building;  (117)
     [Deleted];  and (18)  except  as  specifically  excluded  below,  all other
     non-capital  charges  properly  allocable  to  the  repair,  operation  and
     maintenance of the Land or Building in accordance  with generally  accepted
     accounting principles.



<PAGE>



(iii) "Operating Expenses" shall not include:

(a)  any ground lease rental;

(b)  costs  incurred  by Lessor for the  repair of damage to the  Project to the
     extent  that  Lessor  is  reimbursed  by  insurance  (or  would  have  been
     reimbursed had Lessor carried the insurance coverage required to be carried
     by Lessor under the Lease) or  condemnation  proceeds or by lessees  (other
     than as their  share  of  Operating  Expense),  warrantors  or other  third
     persons (except that insurance deductibles paid by Lessor by be included as
     an Operating Expense);

(c)  costs,  including  permit,  license and  inspection  costs,  incurred  with
     respect to the  construction  or installation  of tenant  improvements  for
     tenants in the Project (including the original Tenant  Improvements for the
     Premises),  or incurred in renovating or otherwise  improving,  decorating,
     painting  or  redecorating  space for  tenants  or other  occupants  of the
     Project,  including  space planning and interior design costs and fees (but
     the foregoing shall not apply to common areas);

(d)  depreciation,  amortization and interest  payments,  except as specifically
     provided  in the  Lease,  and  except on  materials,  tools,  supplies  and
     vendor-type  equipment  purchased  by  Lessor  to  enable  Lessor to supply
     services Lessor might otherwise contract for with a third party, where such
     depreciation,  amortization and interest payments would otherwise have been
     included in the charge for such third party's  services,  all as determined
     in accordance with generally accepted accounting practices;

(e)  brokerage  commissions,  finders'  fees,  attorneys'  fees,  space planning
     costs,  advertising  costs and other costs incurred by Lessor in leasing or
     attempting to lease space in the Building;

(f)  attorneys'  fees and other costs and expenses  incurred in connection  with
     proposals,  negotiations or disputes with present or prospective tenants or
     other occupants of the Project, provided,  however, that Operating Expenses
     shall include any attorneys' fees and other costs and expenses  incurred in
     connection with  enforcement of rules and regulations of the Project or the
     Building,  and  other  similar  matters  relating  to  the  maintenance  of
     standards  required of Lessor  under the Lease for the  general  benefit of
     tenants in the Project;

(g)  interest,  principal,  points  and  fees  on debt  or  amortization  on any
     mortgage,  deed of trust or other debt encumbering the Project, or any part
     thereof;
(h)  any personal  Property  taxes  payable by Lessee or by other tenants of the
     Project;
(i)  the cost of repairing any  structural  defects in the Project and repairing
     any material  defects (as  reasonably  determined by Lessor) in the design,
     materials or workmanship of the Project, including, without limitation, the
     Building;
(j)  capital  improvements,  capital  replacements  and other  capital  costs as
     determined in accordance with generally accepted accounting principles, and
     except as permitted in b(ii), above;

(k)  expenses in  connection  with  repairs,  services,  installations  or other
     benefits of a type which are not offered to Lessee,  but which are provided
     to another  tenant or occupant,  except to the extent  Lessee  receives the
     benefit of such  services or repairs (and in this regard,  Lessee agrees to
     give such notice to Lessor  within a reasonable  time after Lessee  becomes
     aware of any expense which Lessee contends is within this category);

(l)  costs  incurred due to a violation by Lessor or any tenant of the terms and
     conditions  of any lease of space in the  Project,  or  penalties  or fines
     arising from Lessor's  violation of any governmental  rule or authority and
     costs  incurred in correcting any building code  violations  existing as of
     the date of this Lease is signed;

(m)  overhead and profit  increment paid to Lessor or subsidiaries or affiliates
     of Lessor for  management  or other  services  on or to the  Project or for
     goods,  supplies or other  materials,  to the extent that the costs of such
     services,  goods,  supplies or materials  exceed the reasonable  costs that
     would have been paid had the services,  supplies or materials been rendered
     on a competitive  basis (based upon a standard of similar office  buildings
     in  suburban  San Diego) and been  provided  by parties  unaffiliated  with
     Lessor capable of providing same;

(n)  Lessor's general  corporate  overhead and general  administrative  expenses
     (except to the extent  included in a management fee properly  chargeable as
     an Operating Expense under this Lease);

(o)  any compensation paid to clerks,  attendants or other persons in commercial
     concessions  operated by Lessor (except to the extent such  compensation is
     not offset by  revenue to Lessor or  Lessor's  subsidiaries  or  affiliates
     resulting from such commercial concessions);

(p)  rentals  and other  related  expenses  (other  than  taxes  and  insurance)
     incurred in leasing air conditioning systems,  elevators or other equipment
     ordinarily  considered to be or a capital nature,  except equipment that is
     presently  leased for use in or providing  services to the Project or which
     is  customarily  leased by  landlords  of  comparable  office  buildings in
     suburban San Diego and charged to tenants as an item of  expenses,  or that
     is used in providing security,  operational,  and maintenance services, and
     equipments,  the costs of which  would be  included  as an  expenses  under
     (b)(ii),  above (and this  category  (p) shall not exclude  from  Operating
     Expenses the cost of equipment  rentals on a short-term basis as reasonably
     necessary to repair,  maintain or provide  services to the Buildings or the
     Project);

(q)  all items and  services  sold or provided to Lessee or any other tenant for
     which  Lessor or a third  person is  separately  entitled to  reimbursement
     (other than as part of  Operating  Expenses)  over and above basic rent and
     escalations under the applicable lease;

(r)  electric power costs for which any tenant directly contracts with the local
     public service  company or pays to Lessor as any charge in addition to Rent
     or Operating Expenses;

(s)  costs arising from Lessor's  charitable or political  contributions or from
     costs or fees associated with Lessor's membership in a trade association;

(t)  damage  and  repairs  necessitated  by the  gr4oss  negligence  or  willful
     misconduct of Lessor or Lessor's employees, contractors or agents;

(u)  legal  expenses  incurred  in order for  Lessor to  resolve  disputes  with
     contractors  regarding latent defects in design,  materials or workmanship,
     or as a  result  of  Lessor's  defending  the  implied  covenant  of  quiet
     enjoyment in favor of Lessee;

(v)  costs of acquiring sculptures, paintings or other works of art;


<PAGE>


(w)  tax penalties incurred as a result of Lessor's  negligence,  inability,  or
     unwillingness to make payments when due;
(x)  costs  rising  from the  presence  of  hazardous  materials  or  substances
     ("Hazardous  Materials")  (as defined by applicable laws in effect at Lease
     Commencement  Date and in this Lease) in, on, under or about the  Buildings
     or Project  to the extent  that  Lessor is  obligated  to pay such costs as
     provided in the Lease;

(y)  any late fees, assessments, penalties, or similar charges assessed pursuant
     to covenants,  conditions  and  restrictions  ("RR&R's")  applicable to the
     Project resulting from Lessor's negligence or willful misconduct (but other
     fees,   assessments  and  penalties  arising  from  such  CC&R's  shall  be
     chargeable as Operating Expenses);

(z)  earthquake insurance;

(aa) any other general categories of expense,  added at Lessor's option, and not
     included in the Base Year,  unless Lessor makes a  corresponding  equitable
     increase in the Base Year Operating Expenses.

(c)  In order to provide  for  current  payments  on account of Excess  Expenses
     Lessee shall, at Lessor's request,  pay as additional rent, an amount equal
     to Lessee's  Proportionate Share of the Excess Expenses due for the ensuing
     12 months,  as reasonably  estimated by Lessor from time to time, in twelve
     (12) equal monthly  installments,  commencing on the first day of the month
     following the month in which Lessor notifies Lessee of the amount following
     the  month  in  which  Lessor  notifies  Lessee  of the  amount.  It is the
     intention  hereunder to estimate the amount of the Excess Expenses for each
     Comparison  Year and then to adjust  such  estimate in the  following  year
     based on the actual Excess Expenses incurred or paid by Lessor.

(d)  Within  sixty  (60)  days  after  the  end of the  Base  Year  and of  each
     Comparison  Year (or as soon  thereafter  as is  practical),  Lessor or the
     Building  Manager shall deliver to Lessee a reasonably  detailed  statement
     with line item breakdown of reasonably  detailed  categories,  certified by
     Lessor  ("Lessor's  Statement"),   of  the  Real  Estate  Taxes,  Operating
     Expenses,  Excess Expenses,  and Lessee's Proportionate Share of the Excess
     Expenses for the preceding Comparison Year. If Lessee's Proportionate Share
     of the actual Excess Expenses for the previous  Comparison Year exceeds the
     aggregate of the estimated  monthly  payments made by Lessee for such year,
     Lessee  shall  within  thirty  (30) days of the  receipt of the  statement,
     tender to Lessor an amount equal to such excess as additional rent. If such
     aggregate of the estimated monthly payments exceeds Lessee's  Proportionate
     Share of the actual Excess Expenses for such  Comparison  Year, then Lessor
     shall  credit  against   Lessee's  next  ensuing  monthly   installment  or
     installments  of the Rent an  amount  equal to such  difference  until  the
     credit is  exhausted.  Lessee  shall have the  right,  at its own costs and
     expense,  to audit or inspect  Lessor's records with respect to Real Estate
     Taxes,  Operating  Expenses,  and the  calculation  of Excess  Expenses and
     Lessee's  Proportionate  Share.  Lessor  shall  utilize,  and  cause  to be
     utilized,   accounting  records  and  procedures  conforming  to  generally
     accepted accounting principles  consistently applied (as generally accepted
     for similar  buildings in the San Diego suburban area),  including  without
     limitation,  all payments for  Operating  Expenses,  to enable the audit or
     inspection by Lessee  pursuant to this clause to be conducted.  Pursuant to
     the foregoing, Lessor shall be obligated to keep such records until two (2)
     years following the expiration or earlier  termination of the Lease. Lessee
     shall give Lessor not less than ten (10) business days prior written notice
     of its  intention  to conduct any such audit or  inspection.  Lessor  shall
     cooperate with Lessee during the course of such audit or inspection,  which
     shall be conducted  during  normal  business  hours in Lessor's  management
     office.  Lessor agrees to make personnel  available to Lessee as reasonably
     necessary for Lessee, Lessee's employees and agents, to conduct

<PAGE>


     such audit,but in no event shall such audit last more than five(5)business
     days in duration  for each year  audited.  Lessor  shall make such  records
     available to Lessee,  Lessee's  employees and agents, for inspection during
     Normal  Business Hours.  Lessee,  Lessee's  employees and agents,  shall be
     entitled to make photostatic copies of such records,  provided Lessee bears
     the  expense of such  copying.  The results of such  audit,  as  reasonably
     agreed upon by both  parties,  shall be binding upon Lessor and Lessee.  If
     Lessor and Lessee are unable to agree on the audit result,  the issue shall
     be resolved by arbitration. If such audit discloses that the amount paid by
     Lessee  at  Lessee's  Proportionate  Share  of  Excess  Expenses  has  been
     overstated  by  more  than  three  percent  (3%),   then,  in  addition  to
     immediately  repaying such  overpayment and associated  interest to Lessee,
     Lessor  shall also pay the  reasonable  costs  incurred  by Lessee for such
     audit. If such audit discloses that Lessee's  Proportionate  Share has been
     understated,  Lessee shall  immediately pay to Lessor the additional amount
     owing.

     Notwithstanding anything herein to the contrary,Lessor's Statement of
     Excess Expenses and Lessee's  Proportionate  Share shall be binding and
     conclusive    on Lessee as to each Comparison Year unless Lessee requests
     an audit within thirty (30) days after receipt of Lessor's Statement for
     the next following Comparison Year; provided,  further,  that in the event
     of a bona fide sale  or refinance of the Project,  Lessee shall within one
     hundred  ninety (190) days  after  receipt  of notice  from  Lessor,
     certify  in  writing to the proposed  buyer or  mortgagee  that  either
(a)  Lessee  accepts  Lessor's  Statement as to all  Comparison  Years for which
     Lessee has  received  Lessor's  Statement  or (b) Lessee  shall within such
     period  conduct  an audit for any  Comparison  Year as to which  Lessee has
     audit rights and provide the results of such audit to the proposed buyer or
     mortgagee.

(e)  If the  Commencement  Date is other than  January 1 and is in a  Comparison
     Year,  Lessee's  Proportionate  Share of Excess Expenses for the Comparison
     Year in  which  the  Commencement  Date  occurs  shall be  multiplied  by a
     fraction,  the  numerator  of which  shall be the  number  of days from the
     Commencement Date to the following December 31 and the denominator of which
     shall be 365.

(f)  Lessor agrees that Ill Lessor shall make no profit from Lessor's collection
     of Real Estate Taxes and Operating  Expenses (but this provision  shall not
     impair or limit  Lessor's  ability to charge a management  fee as otherwise
     provided in this  Lease);  and (ii) Lessor  shall reduce the amount of Real
     Estate Taxes and/or Operating Expenses (as applicable) by any refund Lessor
     receives in connection with any costs or expenditures  previously  included
     in Real Estate  Taxes or  Operating  Expenses,  less any costs  incurred by
     Lessor by obtaining any such refund.

(g)  When a credit is due from Lessor on the Termination  Date,  Lessee shall be
     entitled  to receive  the amount of the credit in the form of payment  from
     Lessor, provided,  however, that Lessor may, in lieu of such payment, apply
     the  credit  against  any  Rent  which  is due but not  paid on said  date.
     Interest  shall  accrue on any  amounts  which  Lessor is obliged to pay to
     Lessee by reason of this Addendum at the maximum rate permitted by law. The
     obligations  of Lessee and Lessor to make  payments or credits  required by
     this Addendum shall survive the Termination Date.

(h)  Any management agreement shall provide that Lessor operate the Building, in
     an  efficient  and  cost-effective  manner  so  as  to  minimize  operating
     expenses.  Lessee,  or Lessee's agent,  shall have the right at any time to
     review and copy all operating  records,  and Lessor shall maintain all such
     records for two (2) years.


<PAGE>





</TEXT>
</DOCUMENT>
