EXHIBIT 10.37


                              STANDARD OFFICE LEASE

                                 BY AND BETWEEN


                          1212 FLOWER REAL ESTATE, LLC
                      a Delaware limited liability company

                                  AS LANDLORD,


                                       AND


                           PEOPLE'S LIBERATION, INC.,
                            a California corporation


                                   AS TENANT


                                    SUITE 500

             1212 South Flower Street, Los Angeles, California 90015


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                               TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE 1    BASIC LEASE PROVISIONS ........................................   1
ARTICLE 2    TERM/PREMISES .................................................   2
ARTICLE 3    RENTAL ........................................................   3
             (a)   Basic Rental ............................................   3
             (b)   Increase in Direct Costs ................................   3
             (c)   Definitions..............................................   3
             (d)   Determination of Payment ................................   7
ARTICLE 4    SECURITY DEPOSIT...............................................   9
ARTICLE 5    HOLDING OVER ..................................................  11
ARTICLE 6    PERSONAL PROPERTY TAXES........................................  11
ARTICLE 7    USE ...........................................................  12
ARTICLE 8    CONDITION OF PREMISES .........................................  12
ARTICLE 9    REPAIRS AND ALTERATIONS .......................................  13
ARTICLE 10   LIENS .........................................................  15
ARTICLE 11   PROJECT SERVICES ..............................................  15
ARTICLE 12   RIGHTS OF LANDLORD ............................................  17
ARTICLE 13   INDEMNITY; EXEMPTION OF LANDLORD FROM LIABILITY ...............  17
             (a)   Indemnity ...............................................  17
             (b)   Exemption of Landlord from Liability ....................  17
ARTICLE 14   INSURANCE .....................................................  18
             (a)   Tenant's Insurance ......................................  18
             (b)   Form of Policies ........................................  19
             (c)   Landlord's Insurance ....................................  19
             (d)   Waiver of Subrogation ...................................  19
             (e)   Compliance with Law .....................................  20

ARTICLE 15   ASSIGNMENT AND SUBLETTING .....................................  20

ARTICLE 16   DAMAGE OR DESTRUCTION .........................................  23

ARTICLE 17   SUBORDINATION .................................................  24
ARTICLE 18   EMINENT DOMAIN ................................................  25
ARTICLE 19   DEFAULT .......................................................  25


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<PAGE>


                               TABLE OF CONTENTS
                                (continued) Page

ARTICLE 20   REMEDIES.......................................................  27
ARTICLE 21   TRANSFER OF LANDLORD'S INTEREST ...............................  28
ARTICLE 22   BROKER ........................................................  29
ARTICLE 23   PARKING .......................................................  29
ARTICLE 24   WAIVER.........................................................  30
ARTICLE 25   ESTOPPEL CERTIFICATE ..........................................  30
ARTICLE 26   LIABILITY OF LANDLORD .........................................  31
ARTICLE 27   INABILITY TO PERFORM ..........................................  32
ARTICLE 28   HAZARDOUS WASTE ...............................................  32
ARTICLE 29   SURRENDER OF PREMISES; REMOVAL OF PROPERTY ....................  34
ARTICLE 30   OPTION TO EXTEND ..............................................  35
ARTICLE 31   MISCELLANEOUS .................................................  38
             (a)   Severability; Entire Agreement ..........................  38
             (b)   Attorneys' Fees; Waiver of Jury Trial ...................  38
             (c)   Time of Essence .........................................  39
             (d)   Headings; Joint and Several .............................  39
             (e)   Reserved Area ...........................................  39
             (f)   No Option................................................  39
             (g)   Use of Project Name; Improvements .......................  39
             (h)   Rules and Regulations....................................  39
             (i)   Quiet Possession ........................................  40
             (j)   Rent ....................................................  40
             (k)   Successors and Assigns ..................................  40
             (l)   Notices .................................................  40
             (m)   Persistent Delinquencies ................................  41
             (n)   Right of Landlord to Perform ............................  41
             (o)   Access, Changes in Project, Facilities, Name ............  41
             (p)   Signing Authority........................................  42
             (q)   Identification of Tenant ................................  42
             (r)   Substitute Premises .....................................  43


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<PAGE>


                                TABLE OF CONTENTS
                                  (continued)

             (s)   Survival of Obligations .................................  44
             (t)   Confidentiality .........................................  44
             (u)   Governing Law ...........................................  44
             (v)   Property Manager ........................................  44
             (w)   Representations Not Personal ............................  45
             (x)   Anti-Terrorism Representation ...........................  45
             (y)   Signage .................................................  46
             (z)   Cross Default ...........................................  47
             (z)   Exhibits and Addendum ...................................  47
EXHIBIT A    PREMISES ...................................................... A-1
EXHIBIT B    RULES AND REGULATIONS ......................................... B-1
EXHIBIT C    NOTICE OF LEASE TERM DATES AND TENANT'S PROPORTIONATE SHARE.... C-1
EXHIBIT D    [INTENTIONALLY OMITTED] ....................................... D-1
EXHIBIT E    SIGNING RESOLUTION ............................................ E-1


                                     -iii-
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                             STANDARD OFFICE LEASE

                  This Standard  Office Lease ("LEASE") is made and entered into
as of January 22, 2009,  by and between 1212 FLOWER REAL ESTATE,  LLC A DELAWARE
LIMITED  LIABILITY  COMPANY  ("LANDLORD"),  and  PEOPLE'S  LIBERATION,  INC.,  a
California corporation ("TENANT").

                  Landlord hereby leases to Tenant and Tenant hereby leases from
Landlord the premises described as Suite No. 500 of 1212 South Flower Street, as
designated on the plan attached  hereto and  incorporated  herein as Exhibit "A"
("PREMISES"), of the project ("PROJECT") now known as 1212 and 1226 South Flower
Street,  Los  Angeles,  California  90015,  for the Term and upon the  terms and
conditions  hereinafter  set forth,  and  Landlord  and Tenant  hereby  agree as
follows:

                                   ARTICLE 1

                             BASIC LEASE PROVISIONS

         A.       Term:

                  Commencement Date: March 1, 2009

                  Expiration Date: March 31, 2012

         B.       Square Footage: 12,977 rentable square feet

         C.       Basic Rental:


    LEASE PERIOD              ANNUAL BASIC RENTAL      MONTHLY BASIC RENTAL
    ------------              -------------------      --------------------
3/1/2009 - 2/28/2010              $300,000                  $25,000

3/1/2010 - 2/28/2011              $360,000                  $30,000

3/1/2011 - 3/31/2012              $384,000                  $32,000


Notwithstanding  the  foregoing,  so long as Tenant is not in default under this
Lease, Monthly Basic Rental for March 2009 shall be abated.

         D.       Base Year: 2009

         E.       Tenant's Proportionate Share: 18.5%

         F.       Security Deposit:  A security deposit of $100,000 shall be due
                  and payable by Tenant to Landlord upon  Tenant's  execution of
                  this Lease,  subject to adjustment in accordance  with Article
                  4, below.


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         G.       Permitted Use: General office use

         H.       Broker(s): CB Richard Ellis, Inc. and Madison Partners

         I.       Parking  Passes:  Tenant shall have the use of forty-six  (46)
                  unreserved  parking  spaces  and  four  (4)  reserved  parking
                  spaces, at the rate provided in Article 23 hereof.  Subject to
                  availability  and at Landlord's  sole  discretion,  Tenant may
                  lease up to twelve (12) additional  unreserved  parking spaces
                  at the rental rate established by Landlord from time to time.

         J.       First  Month's  Rent:  Basic  Rental in the  amount of $25,000
                  shall be due and payable by Tenant to Landlord  upon  Tenant's
                  execution  of this Lease and shall be applied by  Landlord  to
                  the first month of rent  actually  due from Tenant  under this
                  Lease.

                                   ARTICLE 2

                                 TERM/PREMISES

                  The Term of this Lease shall commence on the Commencement Date
as set forth in Article l.A of the Basic Lease  Provisions  and shall end on the
Expiration  Date set forth in Article  l.A of the Basic  Lease  Provisions.  For
purposes of this Lease, the term "LEASE YEAR" shall mean each consecutive twelve
(12) month period during the Lease Term, with the first Lease Year commencing on
the Commencement  Date;  however,  (a) if the  Commencement  Date falls on a day
other than the first day of a calendar month,  the first Lease Year shall end on
the last day of the eleventh  (11th) month after the  Commencement  Date and the
second (2nd) and each  succeeding  Lease Year shall commence on the first day of
the next calendar month, and (b) the last Lease Year shall end on the Expiration
Date.  Landlord  shall use  commercially  reasonable  efforts to provide  Tenant
access to the Premises on or before February 27, 2009; provided,  however,  that
if such early access is granted,  all terms and provisions of this Lease (except
the obligation to pay Basic Rental) shall apply during  Tenant's early occupancy
of the  Premises,  including,  without  limitation,  all indemnity and insurance
provisions.  If  Landlord  is unable to deliver  possession  of the  Premises to
Tenant on or before the  anticipated  Commencement  Date,  Landlord shall not be
subject to any  liability  for its failure to do so, and such failure  shall not
affect the  validity  of this  Lease nor the  obligations  of Tenant  hereunder;
provided,  however,  that Tenant shall be relieved of the obligation to pay Rent
until such date as Landlord delivers  possession to Tenant, and further provided
that such delay in delivery of  possession  does not exceed sixty (60) days.  If
Landlord  fails to deliver  possession  of the  Premises  to Tenant on or before
expiration of the sixtieth  (60th) day from the date hereby  required,  then the
Lease shall  terminate and neither party shall have any obligation to the other,
except that all Tenant deposits shall be refunded by Landlord promptly,  without
the need for further  notice.  Landlord  and Tenant  hereby  stipulate  that the
Premises contains the number of square


                                      -2-
<PAGE>


feet  specified  in Article  1.B of the Basic  Lease  Provisions.  Landlord  may
deliver to Tenant a Commencement Letter in a form substantially  similar to that
attached  hereto as  Exhibit  "C,"  which  Tenant  shall  execute  and return to
Landlord  within five (5) days of receipt  thereof.  Failure of Tenant to timely
execute and deliver the Commencement  Letter shall constitute an  acknowledgment
by Tenant that the  statements  included  in such  notice are true and  correct,
without exception.

                                   ARTICLE 3

                                     RENTAL

         (a)      BASIC RENTAL. Tenant agrees to pay to Landlord during the Term
                  hereof,  at  Landlord's  office or to such other  person or at
                  such  other  place as  directed  from time to time by  written
                  notice to Tenant from Landlord, the initial monthly and annual
                  sums  as  set  forth  in  Article   1.C  of  the  Basic  Lease
                  Provisions,  payable  in  advance  on the  first  day of  each
                  calendar month,  without demand,  setoff or deduction,  and in
                  the event this Lease  commences or the date of  expiration  of
                  this Lease occurs other than on the first day or last day of a
                  calendar  month,  the rent for such month  shall be  prorated.
                  Notwithstanding  the  foregoing,  the first full  month's rent
                  shall be paid to Landlord in  accordance  with  Article 1.J of
                  the Basic Lease Provisions.

         (b)      INCREASE  IN DIRECT  COSTS.  The term  "BASE  YEAR"  means the
                  calendar  year set forth in  Article  1.D of the  Basic  Lease
                  Provisions.  If, in any calendar  year during the Term of this
                  Lease,  the "DIRECT  COSTS" (as  hereinafter  defined) paid or
                  incurred by Landlord shall be higher than the Direct Costs for
                  the Base Year, Tenant shall pay an additional sum for such and
                  each  subsequent  calendar  year  equal to the  product of the
                  amount set forth in Article 1.E of the Basic Lease  Provisions
                  multiplied by such increased  amount of "Direct Costs." In the
                  event  either the  Premises  and/or the Project is expanded or
                  reduced,   then   Tenant's   Proportionate   Share   shall  be
                  appropriately  adjusted,  and as to the calendar year in which
                  such change occurs, Tenant's Proportionate Share for such year
                  shall be  determined on the basis of the number of days during
                  that particular calendar year that such Tenant's Proportionate
                  Share was in effect.  In the event this Lease shall  terminate
                  on any date other than the last day of a  calendar  year,  the
                  additional sum payable hereunder by Tenant during the calendar
                  year in which this Lease  terminates  shall be prorated on the
                  basis of the relationship  which the number of days which have
                  elapsed from the  commencement  of said  calendar  year to and
                  including  said date on which this Lease  terminates  bears to
                  three hundred sixty (360). Any and all amounts due and payable
                  by Tenant  pursuant to Article 3(b),  (c) and (d) hereof shall
                  be deemed  "ADDITIONAL RENT" and Landlord shall be entitled to
                  exercise  the same rights and  remedies  upon default in these
                  payments as Landlord is entitled to exercise  with  respect to
                  defaults in monthly Basic Rental payments.

         (c)      DEFINITIONS. As used herein the term "DIRECT COSTS" shall mean
                  the sum of the following:


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<PAGE>


                  (i)      "TAX COSTS," which shall mean any and all real estate
                           taxes and other  similar  charges on real property or
                           improvements,  assessments,  water and sewer charges,
                           and all other charges assessed,  reassessed or levied
                           upon the  Project and  appurtenances  thereto and the
                           parking  or  other  facilities  thereof,  or the real
                           property    thereunder    (collectively   the   "REAL
                           PROPERTY") or  attributable  thereto or on the rents,
                           issues,   profits  or  income   received  or  derived
                           therefrom which are assessed, reassessed or levied by
                           the United  States,  the State of  California  or any
                           local government authority or agency or any political
                           subdivision  thereof,  and shall  include  Landlord's
                           reasonable  legal  fees,   costs  and   disbursements
                           incurred in connection with proceedings for reduction
                           of Tax Costs or any part thereof; provided,  however,
                           if at any  time  after  the  date of this  Lease  the
                           methods of taxation now  prevailing  shall be altered
                           so  that  in  lieu  of  or  as a  supplement  to or a
                           substitute  for  the  whole  or any  part  of any Tax
                           Costs, there shall be assessed,  reassessed or levied
                           (a) a tax, assessment, reassessment, levy, imposition
                           or  charge  wholly  or  partially  as a  net  income,
                           capital or franchise  levy or otherwise on the rents,
                           issues, profits or income derived therefrom, or (b) a
                           tax,  assessment,  reassessment,  levy (including but
                           not limited to any municipal, state or federal levy),
                           imposition or charge measured by or based in whole or
                           in part  upon  the Real  Property  and  imposed  upon
                           Landlord,  or (c) a license fee  measured by the rent
                           payable  under  this  Lease,  then  all  such  taxes,
                           assessments,  reassessments  or  levies  or the  part
                           thereof so measured  or based,  shall be deemed to be
                           included  in the term  "Direct  Costs." In  addition,
                           when calculating Tax Costs for the Base Year, special
                           assessments  shall  only be  deemed  included  in Tax
                           Costs  for the  Base  Year to the  extent  that  such
                           special assessments are included in Tax Costs for the
                           applicable subsequent calendar year during the Term.

                  (ii)     "OPERATING  COSTS,"  which  shall  mean all costs and
                           expenses  incurred by Landlord in connection with the
                           maintenance,  operation,  replacement,  ownership and
                           repair   of   the   Project,   the   equipment,   the
                           intrabuilding    network   cable,   adjacent   walks,
                           landscaped   and   common   areas  and  the   parking
                           structure,  areas  and  facilities  of  the  Project,
                           including,   but  not   limited   to,   non-executive
                           salaries,   wages,  medical,   surgical  and  general
                           welfare benefits and pension payments, payroll taxes,
                           fringe   benefits,    employment   taxes,    workers'
                           compensation,  uniforms and dry cleaning  thereof for
                           all persons who perform duties reasonably required in
                           connection with the operation, maintenance and repair
                           of the  Project,  its  equipment,  the  intrabuilding
                           network cable and the adjacent  walks and  landscaped
                           areas,  including  janitorial,  gardening,  security,
                           parking,  operating  engineer,   elevator,  painting,
                           plumbing,     electrical,     carpentry,     heating,
                           ventilation, air conditioning,  window washing, hired
                           services,  a reasonable allowance for depreciation of
                           the  cost  of  acquiring  or the  rental  expense  of
                           personal property used in the maintenance,  operation
                           and repair of the Project, accountant's fees incurred
                           in the  preparation  of rent  adjustment  statements,
                           legal fees, real estate tax consulting fees, personal
                           property  taxes on property  used in the  maintenance
                           and operation of the Project, fees, costs,


                                      -4-
<PAGE>


                           expenses or dues payable pursuant to the terms of any
                           covenants,  conditions  or  restrictions  or  owners'
                           association   pertaining  to  the  Project,   capital
                           expenditures   incurred   to  effect   economies   of
                           operation  of,  or  stability  of  services  to,  the
                           Project   and   capital   expenditures   required  by
                           government    regulations,    laws,   or   ordinances
                           including,  but not  limited  to the  Americans  with
                           Disabilities   Act;   costs   incurred   (capital  or
                           otherwise) on a regular  recurring  basis every three
                           (3) or more years for  certain  maintenance  projects
                           (e.g.,  parking  lot slurry  coat or  replacement  of
                           lobby and  elevator cab  carpeting);  the cost of all
                           charges  for   electricity,   gas,  water  and  other
                           utilities  furnished  to the Project,  including  any
                           taxes  thereon;  the cost of all charges for fire and
                           extended coverage,  liability and all other insurance
                           for the Project carried by Landlord;  the cost of all
                           building and cleaning  supplies  and  materials;  the
                           cost of all charges  for  cleaning,  maintenance  and
                           service contracts and other services with independent
                           contractors  and  administration   fees;  a  property
                           management  fee not to exceed  four  percent  (4%) of
                           total  Direct  Costs  (which  fee may be  imputed  if
                           Landlord  has  internalized  management  or otherwise
                           acts as its own property manager) and license, permit
                           and inspection  fees relating to the Project.  In the
                           event,  during any calendar year, the Project is less
                           than ninety-five percent (95%) occupied at all times,
                           Operating  Costs  shall be  adjusted  to reflect  the
                           Operating Costs of the Project as though  ninety-five
                           percent  (95%) were  occupied  at all times,  and the
                           increase or decrease in the sums owed hereunder shall
                           be based upon such Operating Costs as so adjusted. In
                           no  event  shall  costs  for any  item  of  utilities
                           included in Direct Costs for any year  subsequent  to
                           the Base Year be less  than the  amount  included  in
                           Direct Costs for the Base Year for such utility item.
                           Notwithstanding anything to the contrary set forth in
                           this Article 3, when calculating  Operating Costs for
                           the Base Year,  Operating  Costs  shall  exclude  (a)
                           market-wide labor-rate increases due to extraordinary
                           circumstances including, but not limited to, boycotts
                           and  strikes,  (b)  utility  rate  increases  due  to
                           extraordinary   circumstances   including,   but  not
                           limited  to,   conservation   surcharges,   boycotts,
                           embargoes or other shortages, and (c) amortization of
                           any  capital  items  including,  but not  limited to,
                           capital  improvements,  capital  repairs  and capital
                           replacements  (including  such amortized  costs where
                           the actual  improvement,  repair or  replacement  was
                           made in prior years). Notwithstanding anything to the
                           contrary   set   forth  in  this   Article   3,  when
                           calculating  Operating Costs, Landlord shall exclude:
                           (a) Costs  incurred by Landlord  for the repairs of a
                           capital  nature  to the  Project  (as  determined  in
                           accordance   with  generally   accepting   accounting
                           principles) required as a result of a casualty event;
                           (b)  Costs  of  capital  improvements  and  equipment
                           including, without limitation,  alterations which are
                           considered  capital   improvements  and  replacements
                           under  generally   accepted   accounting   principles
                           consistently  applied ("Capital  Items"),  except for
                           (i)  the  annual  amortization  (amortized  over  the
                           useful life) of costs,  including financing costs, if
                           any incurred by Landlord after the Commencement  Date
                           for any capital improvements installed or paid for by
                           Landlord and required by any new (or change in) laws,
                           rules  or   regulations   of  any   governmental   or
                           quasi-governmental  authority which are enacted after
                           the


                                      -5-
<PAGE>


                           Commencement  Date;  (ii) the cost of  Capital  Items
                           acquired  to  reduce  the  Operating  Costs  or  as a
                           labor-saving  measure or to affect other economics in
                           the   operation  or   maintenance   of  the  Property
                           (amortized at an annual rate  reasonably  calculated,
                           including   interest  of  the  actual  interest  rate
                           incurred  by  Landlord)  to equal  the  amount of the
                           Operating  Costs to be saved  in each  calendar  year
                           throughout  the  term  (as  determined  at  the  time
                           Landlord elects to proceed with a capital improvement
                           or the  capital  equipment  to reduce  the  operating
                           expenses); (iii) minor capital improvements, tools or
                           expenditures;  or  (iv)  capital  improvements  which
                           reduce  expenses which would otherwise be included in
                           Operating  Costs;  (c) rentals for personal  property
                           (except when needed in connection with normal repairs
                           and  maintenance  of  permanent   systems)  which  if
                           purchased,  rather than  rented,  would  constitute a
                           capital improvement  (including,  without limitation,
                           air   conditioning   systems  and   elevators);   (d)
                           depreciation,  amortization and interest  payments on
                           Capital Items, except on materials,  tools,  supplies
                           and  vendor-type  equipment  purchased by Landlord to
                           enable  Landlord to supply  services  Landlord  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,  not to exceed in the
                           aggregate the amount charged by such third party, all
                           as determined in accordance  with generally  accepted
                           accounting principles, consistently applied, and when
                           depreciation   or   amortization   is   permitted  or
                           required,  the  item  shall  be  amortized  over  its
                           reasonably anticipated useful for life; (e) marketing
                           costs,  including leasing  commissions and attorneys'
                           fees incurred in connection  with the  development or
                           leasing of the Project, including without limitation,
                           expenses  incurred in  relationship to the bankruptcy
                           of any tenant,  subtenant  or assignee;  and,  costs,
                           including  permit,   license  and  inspection  costs,
                           incurred with respect to the  installation  of tenant
                           or other  occupant  improvements  made for  Tenant or
                           other   occupants  in  the  Project  or  incurred  in
                           renovating   or  otherwise   improving,   decorating,
                           painting or redecorating  vacant space for tenants or
                           other  occupants  of the  Project;  (f)  expenses  in
                           connection  with services or other benefits which are
                           not provided to Tenant or for which Tenant is charged
                           directly but which are not provided to another tenant
                           or  occupant  of  the   Project;   (g)  premiums  for
                           earthquake   insurance   unless  such   premiums  are
                           included in the Base Year  calculation  of  Operating
                           Costs; (h) ground lease rentals, interest, principal,
                           points  and  fees on  debts  or  amortization  on any
                           mortgage or  mortgages  or any other debt  instrument
                           encumbering  the  Project;   (i)  Landlord's  general
                           corporate  overhead  and general  and  administrative
                           expenses and accountant's fees (as distinguished from
                           the  costs of  operating  the  Project)  except as it
                           specifically   relates  to  the   Project;   (j)  any
                           compensation  paid to  clerks,  attendants,  or other
                           persons in commercial  concessions  (e.g.,  retail or
                           restaurant  operations) operated by Landlord,  except
                           in the  parking  garage;  (k) legal fees and  related
                           legal costs  (including in  connection  therewith all
                           attorneys'  fees and costs of  settlement,  judgments
                           and damages awarded against  Landlord and payments in
                           lieu  thereof)  together  with  any  damages  awarded
                           against Landlord arising from late payments


                                      -6-
<PAGE>


                           made by Landlord or  violations  of law;  (l) amounts
                           charged to Tenant or any other  tenant in the Project
                           with  respect  to all  items and  services  for which
                           Tenant or any other tenant in the Project  reimburses
                           Landlord or is obligated to reimburse Landlord (other
                           than  through  the  Tenant's  proportionate  share of
                           Operating   Costs)   or   which   Landlord   provides
                           selectively   to  one   or   more   tenants   without
                           reimbursement   without   benefit  to   Tenant;   (m)
                           advertising and promotional  expenditures,  and costs
                           of signs in or on the Project; (n) services provided,
                           taxes   attributable   to,  and  cost   incurred   in
                           connection  with  the  operation  of any  retail  and
                           restaurant  operations in the Project, if any, except
                           to the extent the square  footage of such  operations
                           are  included in the rentable  square  footage of the
                           Project and do not exceed the  services,  utility and
                           tax costs  which  would  have been  incurred  had the
                           retail and/or  restaurant space been used for general
                           office  purposes;  (o) costs  incurred as a result of
                           the failure by the  original  owner of the Project to
                           comply  with laws  enacted  on or before the date the
                           temporary   certificate   of  occupancy  (or  similar
                           permit)  for the  shell and core of the  Project  was
                           validly  issued;  (p) costs of  complying  with laws,
                           codes,   regulations   or   ordinances   relating  to
                           Hazardous   Materials   in  building   materials   or
                           otherwise in the Project,  or Hazardous  Materials in
                           the soil or  groundwater  under  the  Project,  which
                           exist  in  violation  of   applicable   Laws  on  the
                           Commencement  Date; (q) Costs incurred with upgrading
                           the Project to comply with the current interpretation
                           of   disability,   life,   fire  and  safety   codes,
                           ordinances,  statutes,  or other laws in effect prior
                           to the  Effective  Date;  or (r) costs  arising  from
                           Landlord's charitable or political contributions.

         (d)      DETERMINATION OF PAYMENT.

                  (i)      If for any calendar year ending or commencing  within
                           the  Term,  Tenant's  Proportionate  Share of  Direct
                           Costs  for  such  calendar   year  exceeds   Tenant's
                           Proportionate  Share  of  Direct  Costs  for the Base
                           Year,  then  Tenant  shall  pay to  Landlord,  in the
                           manner  set  forth in  Article  3(d)(ii)  and  (iii),
                           below, and as additional rent, an amount equal to the
                           excess (the "EXCESS").

                  (ii)     Landlord shall give Tenant a yearly expense  estimate
                           statement (the "ESTIMATE  STATEMENT") which shall set
                           forth Landlord's reasonable estimate (the "ESTIMATE")
                           of what the  total  amount  of  Direct  Costs for the
                           then-current calendar year shall be and the estimated
                           Excess  (the  "ESTIMATED  EXCESS") as  calculated  by
                           comparing  Tenant's  Proportionate  Share  of  Direct
                           Costs for such  calendar  year,  which shall be based
                           upon the Estimate, to Tenant's Proportionate Share of
                           Direct  Costs  for the  Base  Year.  The  failure  of
                           Landlord to timely furnish the Estimate Statement for
                           any calendar year prior to the expiration of eighteen
                           (18) months from the end of such calendar year, shall
                           not preclude  Landlord  from  enforcing its rights to
                           collect any Estimated Excess under this Article 3. If
                           pursuant  to  the  Estimate  Statement  an  Estimated
                           Excess is calculated  for the  then-current  calendar
                           year, Tenant shall pay, with its next installment of


                                       -7-
<PAGE>


                           Monthly Basic Rental due, a fraction of the Estimated
                           Excess for the then-current calendar year (reduced by
                           any amounts  paid  pursuant  to the last  sentence of
                           this Article  3(d)(ii)).  Such fraction shall have as
                           its numerator the number of months which have elapsed
                           in such  current  calendar  year to the month of such
                           payment, both months inclusive, and shall have twelve
                           (12)  as  its  denominator.   Until  a  new  Estimate
                           Statement  is  furnished,  Tenant  shall pay monthly,
                           with the Monthly Basic Rental installments, an amount
                           equal to  one-twelfth  (1/12) of the total  Estimated
                           Excess set forth in the previous  Estimate  Statement
                           delivered by Landlord to Tenant.

                  (iii)    In  addition,  Landlord  shall  endeavor  to  give to
                           Tenant on or before the first day of April  following
                           the end of  each  calendar  year,  a  statement  (the
                           "STATEMENT")  which  shall  state  the  Direct  Costs
                           incurred or accrued for such preceding calendar year,
                           and which shall  indicate the amount,  if any, of the
                           Excess.  Upon  receipt  of  the  Statement  for  each
                           calendar  year  during the Term,  if amounts  paid by
                           Tenant as  Estimated  Excess are less than the actual
                           Excess as  specified on the  Statement,  Tenant shall
                           pay,  with  its next  installment  of  Monthly  Basic
                           Rental  due,  the full  amount of the Excess for such
                           calendar year, less the amounts,  if any, paid during
                           such calendar year as Estimated Excess.  If, however,
                           the Statement  indicates  that amounts paid by Tenant
                           as  Estimated  Excess  are  greater  than the  actual
                           Excess   as   specified   on  the   Statement,   such
                           overpayment  shall be credited  against Tenant's next
                           installments  of  Estimated  Excess.  The  failure of
                           Landlord  to timely  furnish  the  Statement  for any
                           calendar  year  shall  not  prejudice  Landlord  from
                           enforcing  its  rights  under  this  Article  3. Even
                           though the Term has  expired  and Tenant has  vacated
                           the Premises,  provided  that  Landlord  delivers the
                           report to Tenant  within  eighteen  (18) months after
                           expiration of the period  covered  thereby,  when the
                           final determination is made of Tenant's Proportionate
                           Share of the Direct  Costs for the  calendar  year in
                           which this Lease terminates, if an Excess is present,
                           Tenant shall immediately pay to Landlord an amount as
                           calculated pursuant to the provisions of this Article
                           3(d). The provisions of this Article  3(d)(iii) shall
                           survive the expiration or earlier  termination of the
                           Term.

                  (iv)     Within one hundred twenty (120) days after receipt of
                           a Statement by Tenant  ("REVIEW  PERIOD"),  if Tenant
                           disputes  the  amount  set  forth  in the  Statement,
                           Tenant's employees or an independent certified public
                           accountant   (which  accountant  is  a  member  of  a
                           nationally or regionally recognized accounting firm),
                           designated by Tenant, may, after reasonable notice to
                           Landlord and at reasonable times,  inspect Landlord's
                           records at Landlord's  offices,  provided that Tenant
                           is  not  then  in  default  after  expiration  of all
                           applicable  cure  periods and  provided  further that
                           Tenant and such accountant or  representative  shall,
                           and  each  of  them  shall  use  their   commercially
                           reasonable  efforts to cause their respective  agents
                           and employees to, maintain all information  contained
                           in   Landlord's   records   in   strict   confidence.
                           Notwithstanding the


                                      -8-
<PAGE>


                           foregoing, Tenant shall only have the right to review
                           Landlord's  records  one (1) time  during  any twelve
                           (12) month  period.  Tenant's  failure to dispute the
                           amounts set forth in any Statement  within the Review
                           Period  shall be deemed to be  Tenant's  approval  of
                           such  Statement,  and  Tenant  thereafter  waives the
                           right or ability to dispute  the amounts set forth in
                           such Statement. If after such inspection,  but within
                           thirty  (30) days  after the  Review  Period,  Tenant
                           notifies   Landlord  in  writing  that  Tenant  still
                           disputes  such  amounts,  a  certification  as to the
                           proper  amount  shall  be  made  by  an   independent
                           certified public accountant  selected by Landlord and
                           who  is  a  member  of  a  nationally  or  regionally
                           recognized accounting firm, but who is not affiliated
                           with   Landlord  and  has   performed,   directly  or
                           indirectly,  no work for  Landlord  for a  period  of
                           twenty-four  (24) months prior to the selection  made
                           hereunder.  Landlord  shall  cooperate  in good faith
                           with  Tenant  and  the  accountant  and  provide  the
                           accountant reasonable access at normal business hours
                           to the information upon which the certification is to
                           be based. The accountant may make copies of pertinent
                           documents in support of the accountant's  findings as
                           long  as a  commercially  reasonable  confidentiality
                           agreement  is  provided  to   Landlord,   in  a  form
                           acceptable  to  Landlord,  before any such copies are
                           made.   The   accountant   shall   render   a   final
                           certification   within   forty-five   (45)   days  of
                           commencement of the audit contemplated hereby. Tenant
                           shall pay all costs of the accountant, including fees
                           and  expenses,   provided,   however,  that  if  such
                           certification  by  the  accountant  proves  that  the
                           Direct  Costs  set  forth  in  the   Statement   were
                           overstated by more than ten percent  (10%),  then the
                           cost  of  the   accountant   and  the  cost  of  such
                           certification shall be paid for by Landlord. Promptly
                           following the parties' receipt of such certification,
                           the parties shall make such  appropriate  payments or
                           reimbursements, as the case may be, to each other, as
                           are   determined   to  be  owing   pursuant  to  such
                           certification.

                  (v)      If  the  Project  is  a  part  of  a   multi-building
                           development,  those Direct Costs attributable to such
                           development as a whole (and not  attributable  solely
                           to  any   individual   building   therein)  shall  be
                           allocated by Landlord to the Project and to the other
                           buildings  within such  development  on an  equitable
                           basis.

                                   ARTICLE 4

                                SECURITY DEPOSIT

         (a)      Tenant  has  deposited  with  Landlord  the sum set  forth  in
                  Article 1.F of the Basic Lease  Provisions as security for the
                  full and faithful performance of every provision of this Lease
                  to be performed by Tenant. If Tenant breaches any provision of
                  this Lease,  including but not limited to the payment of rent,
                  Landlord may use all or any part of this Security  Deposit for
                  the  payment of any rent or any other sums in  default,  or to
                  compensate  Landlord  for  any  other  loss  or  damage  which
                  Landlord  may  suffer by reason of  Tenant's  default.  If any
                  portion of said deposit is so used or applied, Tenant


                                      -9-
<PAGE>


                  shall,  within five (5) days after  written  demand  therefor,
                  deposit cash with Landlord in an amount  sufficient to restore
                  the Security Deposit to its original amount.  If Monthly Basic
                  Rental  is  increased,  the  amount  of the  Security  Deposit
                  required to be maintained by Tenant shall also be increased so
                  as to maintain,  at all times and from time to time,  the same
                  ratio  to  Monthly   Basic   Rental  as   applicable   on  the
                  Commencement  Date.  Tenant agrees that Landlord  shall not be
                  required to keep the Security  Deposit in trust,  segregate it
                  or  keep  it  separate  from  Landlord's  general  funds,  but
                  Landlord may commingle  the Security  Deposit with its general
                  funds and Tenant  shall not be  entitled  to  interest on such
                  deposit.  At the  expiration  of the Lease Term,  and provided
                  there  exists no default  by Tenant  hereunder,  the  Security
                  Deposit or any  balance  thereof  shall be  returned to Tenant
                  (or, at Landlord's  option,  to Tenant's  assignee),  provided
                  that subsequent to the expiration of this Lease,  Landlord may
                  retain from said  Security  Deposit  (i) an amount  reasonably
                  estimated   by  Landlord  to  cover   potential   Direct  Cost
                  reconciliation  payments due with respect to the calendar year
                  in which this Lease  terminates  or  expires  (such  amount so
                  retained shall not, in any event,  exceed ten percent (10%) of
                  estimated  Direct  Cost  payments  due  from  Tenant  for such
                  calendar  year  through  the  date of  expiration  or  earlier
                  termination  of this Lease and any amounts so retained and not
                  applied to such  reconciliation  shall be  returned  to Tenant
                  within  thirty  (30) days  after  Landlord's  delivery  of the
                  Statement  for such calendar  year),  (ii) any and all amounts
                  reasonably  estimated  by  Landlord  to cover the  anticipated
                  costs  to be  incurred  by  Landlord  to  remove  any  signage
                  provided  to Tenant  under this Lease and to repair any damage
                  caused by such  removal  (in which case any  excess  amount so
                  retained by Landlord shall be returned to Tenant within thirty
                  (30) days after such  removal and  repair),  and (iii) any and
                  all amounts  permitted by law or this Article 4. Tenant hereby
                  waives  the  provisions  of Section  1950.7 of the  California
                  Civil Code and all other  provisions  of law, now or hereafter
                  in  effect,  which  provide  that  Landlord  may claim  from a
                  security  deposit  only those  sums  reasonably  necessary  to
                  remedy  defaults  in the  payment  of rent,  to repair  damage
                  caused by Tenant or to clean  the  Premises,  it being  agreed
                  that Landlord may, in addition,  claim those sums specified in
                  this Article 4 above and/or those sums reasonably necessary to
                  compensate Landlord for any other loss or damage,  foreseeable
                  or unforeseeable, caused by the acts or omissions of Tenant or
                  any officer, employee, agent, contractor or invitee of Tenant.

         (b)      On the first and second  anniversary of the Commencement Date,
                  provided  no  events  or  conditions   have  occurred  or  are
                  occurring that would constitute an Event of Default under this
                  Lease, the amount of the Security  Deposit required  hereunder
                  shall be reduced according to the following schedule:

                  LEASE PERIOD                    AMOUNT OF SECURITY DEPOSIT
                  ------------                    --------------------------
                  Lease Year 1                            $100,000.00
                  Lease Year 2                            $ 75,000.00
                  Lease Year 3- Expiration Date           $ 50,000.00


                                      -10-
<PAGE>


                  So long no Event of Default  is  occurring  or has  previously
                  occurred   on  the  first  and  second   anniversary   of  the
                  Commencement  Date,  Landlord  shall  apply  amounts  held  by
                  Landlord that are in excess of the Security  Deposit  required
                  pursuant  to the above  schedule  to the next  installment  of
                  Monthly  Basic Rent due and payable  under this Lease.  In the
                  event  that an Event of Default  by Tenant  occurs  under this
                  Lease,  Tenant shall no longer be entitled to any reduction of
                  the  Security  Deposit,  and  the  Security  Deposit  required
                  hereunder  shall be the amount then held by Landlord,  subject
                  to  Tenant's  obligations  to  replenish  in  accordance  with
                  Article 4(a), above.

                                   ARTICLE 5

                                  HOLDING OVER

                  Should Tenant,  without Landlord's written consent,  hold over
after  termination  of this Lease,  Tenant  shall  become a tenant from month to
month only upon each and all of the terms herein  provided as may be  applicable
to a month to month  tenancy,  and any such holding over shall not constitute an
extension of this Lease.  During such holding over, Tenant shall pay in advance,
monthly,  rent at one hundred fifty percent (150%) of the rate in effect for the
last month of the Term of this Lease,  in  addition  to, and not in lieu of, all
other  payments  required  to be made by  Tenant  hereunder,  including  but not
limited to Tenant's Proportionate Share of any increase in Direct Costs. Nothing
contained  in this  Article 5 shall be  construed  as consent by Landlord to any
holding over of the  Premises by Tenant,  and  Landlord  expressly  reserves the
right to require  Tenant to surrender  possession of the Premises to Landlord as
provided in this Lease upon the  expiration or earlier  termination of the Term.
If Tenant fails to surrender the Premises upon the  expiration or termination of
this Lease,  Tenant agrees to indemnify,  defend and hold Landlord harmless from
all costs, loss, expense or liability, including without limitation, claims made
by any succeeding tenant, and real estate brokers' claims and attorneys' fees.

                                   ARTICLE 6

                            PERSONAL PROPERTY TAXES

                  Tenant shall pay,  prior to  delinquency,  all taxes  assessed
against or levied  upon trade  fixtures,  furnishings,  equipment  and all other
personal property of Tenant located in the Premises.  In the event any or all of
Tenant's trade  fixtures,  furnishings,  equipment and other  personal  property
shall be assessed and taxed with  property of Landlord,  or if the cost or value
of any  leasehold  improvements  in the Premises  exceeds the cost or value of a
Project-standard  buildout  as  determined  by Landlord  and, as a result,  real
property taxes for the Project are  increased,  Tenant shall pay to Landlord its
share of such taxes within ten (10) days after delivery to Tenant by Landlord of
a statement  in writing  setting  forth the amount of such taxes  applicable  to
Tenant's property or above-standard improvements. Tenant shall assume and pay to
Landlord at the time of paying  Basic  Rental,  any excise,  sales,  use,  rent,
occupancy, garage, parking,


                                      -11-
<PAGE>


gross receipts or other taxes (other than net income taxes) which may be imposed
on or on account of letting of the  Premises or the  payment of Basic  Rental or
any other sums due or payable  hereunder,  and which Landlord may be required to
pay or collect  under any law now in effect or hereafter  enacted.  Tenant shall
pay directly to the party or entity entitled  thereto all business license fees,
gross  receipts taxes and similar taxes and  impositions  which may from time to
time be assessed against or levied upon Tenant,  as and when the same become due
and before  delinquency.  Notwithstanding  anything  to the  contrary  contained
herein, any sums payable by Tenant under this Article 6 shall not be included in
the computation of "Tax Costs."

                                   ARTICLE 7

                                      USE

                  Tenant shall use and occupy the Premises  only for the use set
forth in Article 1.G of the Basic Lease  Provisions  and shall not use or occupy
the  Premises  or permit the same to be used or occupied  for any other  purpose
without the prior  written  consent of Landlord,  which  consent may be given or
withheld in Landlord's sole and absolute  discretion,  and Tenant agrees that it
will use the Premises in such a manner so as not to  interfere  with or infringe
the rights of other tenants in the Project.  Tenant shall,  at its sole cost and
expense,  promptly comply with all laws,  statutes,  ordinances and governmental
regulations  or  requirements  now in force or which may  hereafter  be in force
relating to or affecting (i) the condition,  use or occupancy of the Premises or
the Project, excluding structural changes to the Project not related to Tenant's
particular use of the Premises,  and (ii) improvements  installed or constructed
in the  Premises by or for the benefit of Tenant.  Tenant shall not do or permit
to be done anything which would  invalidate or increase the cost of any fire and
extended  coverage  insurance  policy  covering the Project  and/or the property
located therein, and Tenant shall comply with all rules, orders, regulations and
requirements  of any  organization  which sets out  standards,  requirements  or
recommendations  commonly  referred  to by major  fire  insurance  underwriters.
Tenant shall  promptly,  upon  demand,  reimburse  Landlord  for any  additional
premium charges for any such insurance policy assessed or increased by reason of
Tenant's failure to comply with the provisions of this Article.

                                   ARTICLE 8

                             CONDITIONS OF PREMISES

                  Tenant hereby agrees that the Premises shall be taken "as is,"
"with all faults, "without any representations or warranties," and Tenant hereby
agrees and warrants that it has  investigated and inspected the condition of the
Premises  and the  suitability  of same for Tenant's  purposes,  and Tenant does
hereby waive and disclaim any objection to, cause of action based upon, or claim
that its  obligations  hereunder  should be reduced  or  limited  because of the
condition of the Premises or the Project or the suitability of same for Tenant's
purposes, subject to Landlord's obligation to deliver


                                      -12-
<PAGE>


the Premises  free from  Landlord's  personal  property,  broom clean and in the
condition  existing  as of the  date of this  Lease,  reasonable  wear  and tear
excepted.  Tenant  acknowledges  that  neither  Landlord  nor any  agent nor any
employee of Landlord has made any representation or warranty with respect to the
Premises or the  Project or with  respect to the  suitability  of either for the
conduct of Tenant's business,  and Tenant expressly warrants and represents that
Tenant has relied solely on its own investigation and inspection of the Premises
and the Project in its decision to enter into this Lease and let the Premises in
an "As Is" condition.  The existing leasehold improvements in the Premises as of
the date of this Lease shall be referred to herein as the "TENANT IMPROVEMENTS."
The taking of possession of the Premises by Tenant shall conclusively  establish
that the Premises and the Project were at such time in  satisfactory  condition.
Tenant hereby  waives  Sections 1941 and 1942 of the Civil Code of California or
any successor provision of law.

                  Landlord  reserves the right from time to time, but subject to
payment by and/or  reimbursement from Tenant as otherwise provided herein:(i) to
install, use, maintain, repair, replace and relocate for service to the Premises
and/or other parts of the Project  pipes,  ducts, conduits,  wires,  appurtenant
fixtures,  and  mechanical  systems,  wherever  located in the  Premises  or the
Project,  (ii) to alter,  close or relocate  any facility in the Premises or the
Common Areas or otherwise conduct any of the above activities for the purpose of
complying with a general plan for fire/life  safety for the Project or otherwise
and (iii) to comply  with any  federal,  state or local law,  rule or order with
respect  thereto or the  regulation  thereof not  currently in effect.  Landlord
shall attempt to perform any such work with the least inconvenience to Tenant as
possible,  but in no event shall Tenant be permitted to withhold or reduce Basic
Rental or other  charges due  hereunder  as a result of same or  otherwise  make
claim against Landlord for interruption or interference  with Tenant's  business
and/or operations.

                                   ARTICLE 9

                            REPAIRS AND ALTERATIONS

                  Landlord shall maintain the structural portions of the Project
including the foundation,  floor/ceiling  slabs,  roof,  curtain wall,  exterior
glass,  columns,  beams, shafts,  stairs,  stairwells,  elevator cabs and common
areas and shall also maintain and repair the basic mechanical,  electrical, life
safety,   plumbing,    sprinkler   systems   and   heating,    ventilating   and
air-conditioning  systems (provided,  however,  that Landlord's  obligation with
respect to any such systems  shall be to repair and maintain  those  portions of
the systems  located in the core of the Project or in other areas outside of the
Premises,   but  Tenant  shall  be   responsible  to  repair  and  maintain  any
distribution  of such  systems  throughout  the  Premises).  Except as expressly
provided as  Landlord's  obligation  in this  Article 9,  Tenant  shall keep the
Premises in good  condition and repair.  All damage or injury to the Premises or
the Project  resulting  from the act or  negligence  of Tenant,  its  employees,
agents or visitors, guests, invitees or licensees or by the use of the Premises


                                      -13-
<PAGE>


shall be  promptly  repaired  by Tenant,  at its sole cost and  expense,  to the
satisfaction of Landlord; PROVIDED, HOWEVER, that for damage to the Project as a
result  of  casualty  or  for  any  repairs  that  may  impact  the  mechanical,
electrical,  plumbing,  heating,  ventilation or air-conditioning systems of the
Project,  Landlord  shall have the right (but not the  obligation) to select the
contractor and oversee all such repairs. Landlord may make any repairs which are
not promptly  made by Tenant after  Tenant's  receipt of written  notice and the
reasonable  opportunity  of Tenant to make said repair  within five (5) business
days from  receipt  of said  written  notice,  and  charge  Tenant  for the cost
thereof,  which cost shall be paid by Tenant  within five (5) days from  invoice
from Landlord.  Tenant shall be  responsible  for the design and function of all
nonstandard  improvements of the Premises,  whether or not installed by Landlord
at Tenant's request.  Tenant waives all rights to make repairs at the expense of
Landlord,  or to deduct the cost  thereof  from the rent.  Tenant  shall make no
alterations,   changes  or  additions  in  or  to  the  Premises  (collectively,
"ALTERATIONS")  without  Landlord's  prior  written  consent,  and then  only by
contractors  or mechanics  approved by Landlord in writing and upon the approval
by  Landlord  in  writing  of  fully   detailed   and   dimensioned   plans  and
specifications  pertaining to the  Alterations  in question,  to be prepared and
submitted by Tenant at its sole cost and expense.  Tenant shall at its sole cost
and  expense  obtain all  necessary  approvals  and  permits  pertaining  to any
Alterations  approved by Landlord.  If Landlord,  in approving any  Alterations,
specifies a commencement date therefor,  Tenant shall not commence any work with
respect to such  Alterations  prior to such  date.  Tenant  hereby  indemnifies,
defends and agrees to hold  Landlord free and harmless from all liens and claims
of lien,  and all other  liability,  claims and demands  arising out of any work
done or  material  supplied  to the  Premises  by or at the request of Tenant in
connection with any Alterations.  If permitted  Alterations are made, they shall
be made at Tenant's  sole cost and expense and shall be and become the  property
of  Landlord,  except that  Landlord  may, by written  notice to Tenant given at
least thirty (30) days prior to the end of the Term,  require Tenant at Tenant's
expense to remove  all  partitions,  counters,  railings  and other  Alterations
installed by Tenant,  and to repair any damages to the  Premises  caused by such
removal. Any and all costs attributable to or related to the applicable building
codes of the city in which the Project is located (or any other authority having
jurisdiction  over the Project)  arising from  Tenant's  plans,  specifications,
improvements,  alterations or otherwise shall be paid by Tenant at its sole cost
and expense. With regard to repairs,  Alterations or any other work arising from
or  related  to this  Article  9,  Landlord  shall be  entitled  to  receive  an
administrative/supervision  fee (which fee shall vary  depending upon whether or
not Tenant  orders the work  directly  from  Landlord)  sufficient to compensate
Landlord for all overhead, general conditions, fees and other costs and expenses
arising from Landlord's involvement with such work.


                                      -14-
<PAGE>


                                   ARTICLE 10

                                     LIENS

                  Tenant  shall keep the  Premises and the Project free from any
mechanics'  liens,  vendors'  liens or any other  liens  arising out of any work
performed,  materials furnished or obligations incurred by Tenant, and agrees to
defend,  indemnify and hold harmless  Landlord from and against any such lien or
claim or action thereon,  together with costs of suit and reasonable  attorneys'
fees  incurred by Landlord in connection  with any such claim or action.  Before
commencing  any work of  alteration,  addition or  improvement  to the Premises,
Tenant shall give  Landlord at least ten (10) business  days' written  notice of
the proposed  commencement  of such work (to afford  Landlord an  opportunity to
post appropriate notices of  non-responsibility).  In the event that there shall
be  recorded  against the  Premises or the Project or the  property of which the
Premises  is a part any claim or lien  arising  out of any such work  performed,
materials  furnished  or  obligations  incurred by Tenant and such claim or lien
shall not be removed  or  discharged  within  ten (10) days of filing,  Landlord
shall  have the  right but not the  obligation  to pay and  discharge  said lien
without  regard to  whether  such lien  shall be lawful or correct or to require
that Tenant  deposit with Landlord in cash,  lawful money of the United  States,
one hundred fifty percent  (150%) of the amount of such claim,  which sum may be
retained by Landlord until such claim shall have been removed of record or until
judgment  shall have been  rendered on such claim and such  judgment  shall have
become final,  at which time Landlord shall have the right to apply such deposit
in discharge of the judgment on said claim and any costs,  including  attorneys'
fees incurred by Landlord, and shall remit the balance thereof to Tenant.

                                   ARTICLE 11

                                PROJECT SERVICES

         (a)      Landlord  agrees to furnish to the  Premises,  at a cost to be
                  included  in  Operating  Costs,  from 8:00  a.m.  to 6:00 p.m.
                  Mondays  through  Fridays  and  8:00  a.m.  to  1:00  p.m.  on
                  Saturdays,   excepting  local  and  national   holidays,   air
                  conditioning and heat, all in such reasonable quantities as in
                  the  judgment  of  Landlord is  reasonably  necessary  for the
                  comfortable occupancy of the Premises.  In addition,  Landlord
                  shall provide  electric current for normal lighting and normal
                  office machines,  elevator service and water on the same floor
                  as the Premises  for  lavatory  and drinking  purposes in such
                  reasonable  quantities  as in  the  judgment  of  Landlord  is
                  reasonably  necessary for general  office use.  Janitorial and
                  maintenance  services  shall  be  furnished  five (5) days per
                  week,  excepting  local and  national  holidays.  Tenant shall
                  comply  with all  rules and  regulations  which  Landlord  may
                  reasonably establish for the proper functioning and protection
                  of  the  common  area  air  conditioning,  heating,  elevator,
                  electrical  intrabuilding  network cable and plumbing systems.
                  Landlord  shall not be liable for,  and there shall be no rent
                  abatement  as  a  result  of,  any   stoppage,   reduction  or
                  interruption  of any  such  services  caused  by  governmental
                  rules,   regulations  or  ordinances,   riot,  strike,   labor
                  disputes,


                                      -15-
<PAGE>


                  breakdowns,  accidents,  necessary  repairs  or  other  cause.
                  Except as  specifically  provided in this  Article 11,  Tenant
                  agrees to pay for all utilities and other services utilized by
                  Tenant and additional  building  services  furnished to Tenant
                  not  uniformly  furnished to all tenants of the Project at the
                  rate generally charged by Landlord to tenants of the Project.

         (b)      Tenant  will  not,   without  the  prior  written  consent  of
                  Landlord,  use any  apparatus or device in the Premises  which
                  will in any way  increase the amount of  electricity  or water
                  usually  furnished  or  supplied  for use of the  Premises  as
                  general office space;  nor connect any  apparatus,  machine or
                  device with water pipes or electric  current  (except  through
                  existing electrical outlets in the Premises),  for the purpose
                  of using electric current or water.

         (c)      If Tenant  shall  require  electric  current in excess of that
                  which  Landlord is obligated to furnish  under  Article  11(a)
                  above,  Tenant  shall  first  obtain  the  written  consent of
                  Landlord,  which  Landlord may refuse in its sole and absolute
                  discretion,  to the use  thereof  and  Landlord  may  cause an
                  electric  current  meter or  submeter to be  installed  in the
                  Premises to measure the amount of such excess electric current
                  consumed by Tenant in the Premises. The cost of any such meter
                  and of  installation,  maintenance and repair thereof shall be
                  paid for by  Tenant  and  Tenant  agrees  to pay to  Landlord,
                  promptly upon demand therefor by Landlord, for all such excess
                  electric  current  consumed  by any  such use as shown by said
                  meter at the rates  charged  for such  service  by the city in
                  which the Project is located or the local public  utility,  as
                  the case may be,  furnishing  the  same,  plus any  additional
                  expense  incurred  by  Landlord  in  keeping  account  of  the
                  electric current so consumed.

         (d)      If any  lights,  machines  or  equipment  (including  but  not
                  limited to computers) are used by Tenant in the Premises which
                  materially affect the temperature  otherwise maintained by the
                  air conditioning  system, or generate  substantially more heat
                  in the  Premises  than  would  be  generated  by the  building
                  standard  lights and usual office  equipment,  Landlord  shall
                  have the right to install any machinery  and  equipment  which
                  Landlord  reasonably  deems  necessary to restore  temperature
                  balance,  including  but not limited to  modifications  to the
                  standard   air   conditioning   equipment,    and   the   cost
                  thereof, including the cost of installation and any additional
                  cost of operation and maintenance occasioned thereby, shall be
                  paid by Tenant to Landlord  upon demand by Landlord.  Landlord
                  shall not be liable  under  any  circumstances  for loss of or
                  injury  to  property,   however   occurring,   through  or  in
                  connection with or incidental to failure to furnish any of the
                  foregoing.

         (e)      If   Tenant   requires   heating,   ventilation   and/or   air
                  conditioning  during  times  other than the times  provided in
                  Article  11(a) above,  Tenant shall give Landlord such advance
                  notice as  Landlord  shall  reasonably  require  and shall pay
                  Landlord's standard charge for such after-hours use.


                                      -16-
<PAGE>


         (f)      Landlord may impose a reasonable  charge for any  utilities or
                  services (other than electric current and heating, ventilation
                  and/or air  conditioning  which  shall be governed by Articles
                  11(c)  and (e)  above)  utilized  by  Tenant  in excess of the
                  amount or type that Landlord reasonably  determines is typical
                  for general office use.

                                   ARTICLE 12

                               RIGHT OF LANDLORD

                  Landlord  and its  agents  shall  have the  right to enter the
Premises  at all  reasonable  times for the purpose of  cleaning  the  Premises,
examining or inspecting the same,  serving or posting and keeping posted thereon
notices as provided by law, or which Landlord deems necessary for the protection
of Landlord or the Property, showing the same to prospective tenants, lenders or
purchasers  of the  Project,  in the case of an  emergency,  and for making such
alterations,  repairs,  improvements  or  additions  to the  Premises  or to the
Project as Landlord  may deem  necessary  or  desirable.  If Tenant shall not be
personally  present to open and permit an entry  into the  Premises  at any time
when such an entry by Landlord is necessary or permitted hereunder, Landlord may
enter by means of a master  key or may  enter  forcibly,  only in the case of an
emergency, without liability to Tenant and without affecting this Lease.

                                   ARTICLE 13

                INDEMNITY: EXEMPTION OF LANDLORD FROM LIABILITY

         (a)      INDEMNITY.  Tenant shall  indemnify,  defend and hold Landlord
                  harmless from any and all claims  arising from Tenant's use of
                  the  Premises  or the  Project  or  from  the  conduct  of its
                  business  or from any  activity,  work or thing  which  may be
                  permitted  or suffered  by Tenant in or about the  Premises or
                  the  Project  and shall  further  indemnify,  defend  and hold
                  Landlord  harmless from and against any and all claims arising
                  from  any  breach  or  default  in  the   performance  of  any
                  obligation on Tenant's  part to be performed  under this Lease
                  or arising from any negligence of Tenant or any of its agents,
                  contractors,  employees  or  invitees,  patrons,  customers or
                  members  in or about the  Project  and from any and all costs,
                  attorneys'  fees,  expenses  and  liabilities  incurred in the
                  defense  of any  claim or any  action  or  proceeding  brought
                  thereon,   including  negotiations  in  connection  therewith.
                  Tenant hereby assumes all risk of damage to property or injury
                  to persons in or about the Premises from any cause, and Tenant
                  hereby waives all claims in respect thereof against  Landlord,
                  excepting  where  the  damage  is  caused  solely by the gross
                  negligence or willful misconduct of Landlord.

         (b)      EXEMPTION OF LANDLORD FROM  LIABILITY.  Landlord  shall not be
                  liable  for  injury to  Tenant's  business,  or loss of income
                  therefrom,  or,  except in  connection  with  damage or injury
                  resulting from the gross  negligence or willful  misconduct of
                  Landlord,  or its  authorized  agents,  for damage that may be
                  sustained by the person, goods, wares, merchandise or property
                  of Tenant,  its employees,  invitees,  customers,  agents,  or
                  contractors,  or any other person in, on or about the Premises
                  directly  or  indirectly  caused by or  resulting  from  fire,
                  steam, electricity, gas, water, or


                                      -17-
<PAGE>


                  rain  which  may  leak or flow  from or into  any  part of the
                  Premises, or from the breakage, leakage,  obstruction or other
                  defects of the pipes, sprinklers, wires, appliances, plumbing.
                  air conditioning,  light fixtures, or mechanical or electrical
                  systems or from  intrabuilding  network  cable,  whether  such
                  damage or injury  results  from  conditions  arising  upon the
                  Premises  or upon other  portions of the Project or from other
                  sources or places and  regardless of whether the cause of such
                  damage  or  injury  or the  means  or  repairing  the  same is
                  inaccessible to Tenant. Landlord shall not be liable to Tenant
                  for any damages  arising  from any act or neglect of any other
                  tenant of the building.

                  Tenant   acknowledges  that  Landlord's  election  to  provide
                  mechanical  surveillance or to post security  personnel in the
                  project is solely within Landlord's discretion; Landlord shall
                  have no liability in connection  with the decision  whether or
                  not to provide  such  services  and Tenant  hereby  waives all
                  claims based thereon.  Landlord shall not be liable for losses
                  due to theft,  vandalism, or like causes. Tenant shall defend,
                  indemnify,  and hold  Landlord  harmless  from any such claims
                  made by any employee, licensee, invitee, contractor, agent, or
                  other  person  whose  presence in, on or about the Premises or
                  the Project is attendant to the business of Tenant.

                                   ARTICLE 14

                                   INSURANCE

         (a)      TENANT'S INSURANCE. Tenant shall, at all times during the Term
                  of this Lease,  and at its own cost and  expense,  procure and
                  continue  in  force  the  following  insurance  coverage:  (i)
                  Commercial General Liability  Insurance with a combined single
                  limit for bodily injury and property  damages of not less than
                  Two Million  Dollars  ($2,000,000)  per  occurrence  and Three
                  Million  Dollars   ($3,000,000)   in  the  annual   aggregate,
                  including products liability coverage if applicable,  covering
                  the insuring  provisions of this Lease and the  performance of
                  Tenant  of  the  indemnity  and  exemption  of  Landlord  from
                  liability  agreements  set forth in Article 13 hereof;  (ii) a
                  policy  of  standard  fire,   extended  coverage  and  special
                  extended coverage insurance (all risks), including a vandalism
                  and malicious mischief endorsement, sprinkler leakage coverage
                  and earthquake sprinkler leakage where sprinklers are provided
                  in an amount equal to the full  replacement  value new without
                  deduction  for  depreciation  of all (A) Tenant  Improvements,
                  Alterations,  fixtures and other  improvements in the Premises
                  and  (B)  trade  fixtures,  furniture,   equipment  and  other
                  personal  property  installed  by or at the expense of Tenant;
                  (iii) Worker's  Compensation  coverage as required by law; and
                  (iv) business  interruption,  loss of income and extra expense
                  insurance  covering  failure  of  Tenant's  telecommunications
                  equipment   and  covering  all  other   perils,   failures  or
                  interruptions.  Tenant  shall  carry and  maintain  during the
                  entire  Lease  Term   (including   any  option   periods,   if
                  applicable),  at  Tenant's  sole cost and  expense,  increased
                  amounts  of the  insurance  required  to be  carried by Tenant
                  pursuant to this Article 14 and such other reasonable types of
                  insurance coverage and in such reasonable amounts covering


                                      -18-
<PAGE>


                  the  Premises  and  Tenant's  operations  therein,  as  may be
                  reasonably required by Landlord.

         (b)      FORM  OF  POLICIES.   The  aforementioned  minimum  limits  of
                  policies  and Tenant's  procurement  and  maintenance  thereof
                  shall in no event limit the liability of Tenant hereunder. The
                  Commercial  General  Liability  Insurance  policy  shall  name
                  Landlord,  Landlord's property manager,  Landlord's  lender(s)
                  and such other  persons or firms as  Landlord  specifies  from
                  time to  time,  as  additional  insureds  with an  appropriate
                  endorsement  to the  policy(s).  All such  insurance  policies
                  carried by Tenant shall be with  companies  having a rating of
                  not less than A-VIII in Best's Insurance  Guide.  Tenant shall
                  furnish to Landlord,  from the insurance  companies,  or cause
                  the insurance companies to furnish,  certificates of coverage.
                  No such policy shall be  cancelable or subject to reduction of
                  coverage or other  modification or  cancellation  except after
                  thirty  (30) days'  prior  written  notice to  Landlord by the
                  insurer.  All such  policies  shall be  endorsed to agree that
                  Tenant's  policy is primary and that any insurance  covered by
                  Landlord  is  excess  and not  contributing  with  any  Tenant
                  insurance requirement hereunder. Tenant shall, at least twenty
                  (20) days prior to the  expiration of such  policies,  furnish
                  Landlord  with  renewals  or  binders.  Tenant  agrees that if
                  Tenant  does not  take  out and  maintain  such  insurance  or
                  furnish  Landlord with renewals or binders,  Landlord may (but
                  shall not be required to) procure  said  insurance on Tenant's
                  behalf and charge Tenant the cost thereof,  which amount shall
                  be payable by Tenant upon demand  with  interest  (at the rate
                  set forth in Article  20(e) below) from the date such sums are
                  extended.   Tenant  shall  have  the  right  to  provide  such
                  insurance  coverage  pursuant to blanket policies  obtained by
                  Tenant,   provided  such  blanket  policies  expressly  afford
                  coverage  to the  Premises  and to Tenant as  required by this
                  Lease.

         (c)      LANDLORD'S INSURANCE. Landlord shall, as a cost to be included
                  in Operating  Costs,  procure and maintain at all times during
                  the Term of this  Lease,  a policy or  policies  of  insurance
                  covering  loss or damage to the  Project  in the amount of the
                  full  replacement  costs without  deduction  for  depreciation
                  thereof  (exclusive  of Tenant's  trade  fixtures,  inventory,
                  personal property and equipment), providing protection against
                  all  perils  included  within the  classification  of fire and
                  extended coverage,  vandalism coverage and malicious mischief,
                  sprinkler leakage, water damage, and special extended coverage
                  on  building.  Additionally,  Landlord  may (but  shall not be
                  required  to) carry:  (i) Bodily  Injury and  Property  Damage
                  Liability   Insurance   and/or   Excess   Liability   Coverage
                  Insurance;  and (ii) Earthquake and/or Flood Damage Insurance;
                  and  (iii)  Rental  Income  Insurance  at its  election  or if
                  required  by its  lender  from  time to time  during  the Term
                  hereof,  in such  amounts  and with such limits as Landlord or
                  its lender may deem  appropriate.  The costs of such insurance
                  shall be included in Operating Costs.

         (d)      WAIVER  OF  SUBROGATION.  Tenant  hereby  agrees  to have  its
                  insurers issuing the insurance described in Articles 14(a)(ii)
                  and  14(a)(iv)  waive  any  rights  of  subrogation  that such
                  companies may have against Landlord. Tenant hereby waives any


                                      -19-
<PAGE>


                  right that Tenant may have against Landlord as a result of any
                  loss or damage to the extent such loss or damage is  insurable
                  under such policies.

         (e)      COMPLIANCE  WITH LAW.  Tenant  agrees that it will not, at any
                  time, during the Term of this Lease,  carry any stock of goods
                  or do anything in or about the  Premises  that will in any way
                  tend to increase the insurance rates upon the Project.  Tenant
                  agrees to pay Landlord  immediately  upon demand the amount of
                  any  increase in premiums for  insurance  against loss by fire
                  that  may be  charged  during  the  Term of this  Lease on the
                  amount of  insurance  to be carried by Landlord on the Project
                  resulting from the foregoing,  or from Tenant doing any act in
                  or about said  Premises  that does so increase  the  insurance
                  rates,  whether or not Landlord  shall have  consented to such
                  act on the  part  of  Tenant.  If  Tenant  installs  upon  the
                  Premises  any  electrical   equipment  which   constitutes  an
                  overload of electrical lines of the Premises,  Tenant shall at
                  its own cost and  expense in  accordance  with all other Lease
                  provisions,  and subject to the  provisions  of Articles 9, 10
                  and 11, hereof,  make whatever changes are necessary to comply
                  with  requirements  of  the  insurance  underwriters  and  any
                  governmental  authority  having  jurisdiction  thereover,  but
                  nothing  herein   contained  shall  be  deemed  to  constitute
                  Landlord's  consent to such overloading.  Tenant shall, at its
                  own expense,  comply with all  requirements  of the  insurance
                  authority having  jurisdiction  over the Project necessary for
                  the  maintenance  of  reasonable  fire and  extended  coverage
                  insurance  for  the  Premises,  including  without  limitation
                  thereto,   the  installation  of  fire   extinguishers  or  an
                  automatic dry chemical extinguishing system.

                                   ARTICLE 15

                           ASSIGNMENT AND SUBLETTING

                  Tenant   shall   have  no  power   to,   either   voluntarily,
involuntarily,  by  operation of law or  otherwise,  sell,  assign,  transfer or
hypothecate  this Lease,  or sublet the Premises or any part thereof,  or permit
the  Premises or any part  thereof to be used or  occupied by anyone  other than
Tenant or Tenant's employees without the prior written consent of Landlord which
shall not be  unreasonably  delayed,  conditioned  or  withheld.  If Tenant is a
corporation,   unincorporated  association,  partnership  or  limited  liability
company, the sale,  assignment,  transfer or hypothecation of any class of stock
or other ownership  interest in such  corporation,  association,  partnership or
limited liability company in excess of forty-nine percent (49%) in the aggregate
shall be deemed an assignment  within the meaning and provisions of this Article
15.  Tenant  may  transfer  its  interest  pursuant  to this Lease only upon the
following express conditions, which conditions are agreed by Landlord and Tenant
to be reasonable:

         (a)      That the  proposed  transferee  shall be  subject to the prior
                  written  consent  of  Landlord,  which  consent  will  not  be
                  unreasonably  delayed,  conditioned  or withheld but,  without
                  limiting  the  generality  of  the  foregoing,   it  shall  be
                  reasonable for Landlord to deny such consent if:


-20-
<PAGE>


                  (i)      The use to be made of the  Premises  by the  proposed
                           transferee is (a) not generally  consistent  with the
                           character  and nature of all other  tenancies  in the
                           Project,  or  (b)  a use  which  conflicts  with  any
                           so-called  "exclusive"  then in favor  of, or for any
                           use  which  is  the  same  as  that   stated  in  any
                           percentage  rent  lease  to,  another  tenant  of the
                           Project or any other  buildings which are in the same
                           complex as the  Project,  or (c) a use which would be
                           prohibited   by  any  other  portion  of  this  Lease
                           (including,   but  not  limited  to,  any  Rules  and
                           Regulations then in effect);

                  (ii)     The   financial   responsibility   of  the   proposed
                           transferee  relative  to  Tenant  is  not  reasonably
                           satisfactory to Landlord or in any event not at least
                           equal to those which were  possessed  by Tenant as of
                           the date of execution of this Lease;

                  (iii)    The  proposed  transferee  is  either a  governmental
                           agency or instrumentality thereof; or

                  (iv)     Either  the  proposed  transferee  or any  person  or
                           entity  which  directly or  indirectly  controls,  is
                           controlled  by or is under  common  control  with the
                           proposed transferee (A) occupies space in the Project
                           at the time of the  request  for  consent,  or (B) is
                           negotiating  with  Landlord  or has  negotiated  with
                           Landlord during the six (6) month period  immediately
                           preceding the date of the proposed transfer, to lease
                           space in the Project.

         (b)      Whether or not Landlord consents to any such transfer,  Tenant
                  shall pay to Landlord  Landlord's then standard processing fee
                  and reasonable attorneys' fees incurred in connection with the
                  proposed transfer in an amount not to exceed the aggregate sum
                  of $2,500.00;

         (c)      That  the  proposed  transferee  shall  execute  an  agreement
                  pursuant to which it shall agree to perform  faithfully and be
                  bound by all of the terms, covenants,  conditions,  provisions
                  and agreements of this Lease applicable to that portion of the
                  Premises so transferred; and

         (d)      That an executed  duplicate  original of said  assignment  and
                  assumption  agreement or other  transfer on a form  reasonably
                  approved by Landlord,  shall be  delivered to Landlord  within
                  five (5) days  after  the  execution  thereof,  and that  such
                  transfer shall not be binding upon Landlord until the delivery
                  thereof  to  Landlord  and  the   execution  and  delivery  of
                  Landlord's  consent  thereto.  It  shall  be  a  condition  to
                  Landlord's  consent  to any  subleasing,  assignment  or other
                  transfer of part or all of Tenant's  interest in the  Premises
                  (hereinafter  referred  to  as a  "TRANSFER")  that  (i)  upon
                  Landlord's  consent  to any  Transfer,  Tenant  shall  pay and
                  continue to pay fifty percent (50%) of any "Transfer  Premium"
                  (defined below), received by Tenant from the transferee;  (ii)
                  any  sublessee  of part  or all of  Tenant's  interest  in the
                  Premises  shall  agree that in the event  Landlord  gives such
                  sublessee notice that Tenant is in default under this


                                      -21-
<PAGE>


                  Lease,  such sublessee  shall  thereafter make all sublease or
                  other payments directly to Landlord, which will be received by
                  Landlord  without any liability  whether to honor the sublease
                  or otherwise  (except to credit such payments against sums due
                  under this Lease),  and any sublessee shall agree to attorn to
                  Landlord or its successors and assigns at their request should
                  this Lease be  terminated  for any  reason,  except that in no
                  event shall Landlord or its successors or assigns be obligated
                  to accept such attornment; (iii) any such Transfer and consent
                  shall be  effected on forms  supplied  by Landlord  and/or its
                  legal counsel;  (iv) Landlord may require that Tenant not then
                  be in default hereunder in any respect;  and (v) Tenant or the
                  proposed  subtenant or assignee  (collectively,  "TRANSFEREE")
                  shall agree to pay Landlord,  upon demand, as additional rent,
                  a sum  equal to the  additional  costs,  if any,  incurred  by
                  Landlord for  maintenance and repair as a result of any change
                  in the  nature  of  occupancy  caused  by such  subletting  or
                  assignment. "TRANSFER PREMIUM" shall mean all rent, additional
                  rent  or  other  consideration  payable  by  a  Transferee  in
                  connection   with  a  Transfer  in  excess  of  the  rent  and
                  Additional  Rent payable by Tenant under this Lease during the
                  term of the Transfer and if such  Transfer is less than all of
                  the  Premises,  the Transfer  Premium shall be calculated on a
                  rentable  square foot  basis.  "Transfer  Premium"  shall also
                  include,  but not be limited  to, key  money,  bonus  money or
                  other cash  consideration  paid by a  transferee  to Tenant in
                  connection  with such  Transfer,  and any payment in excess of
                  fair market  value for  services  rendered  by Tenant,  to the
                  Transferee  and any payment in excess of fair market value for
                  assets,   fixtures,   inventory,   equipment,   or   furniture
                  transferred  by Tenant to the  Transferee in  connection  with
                  such Transfer. Any sale assignment, hypothecation, transfer or
                  subletting of this Lease which is not in  compliance  with the
                  provisions of this Article 15 shall be void and shall,  at the
                  option of Landlord,  terminate  this Lease.  In no event shall
                  the consent by  Landlord to an  assignment  or  subletting  be
                  construed as relieving Tenant, any assignee, or sublessee from
                  obtaining  the  express  written  consent of  Landlord  to any
                  further assignment or subletting,  or as releasing Tenant from
                  any  liability  or  obligation  hereunder  whether or not then
                  accrued and Tenant shall continue to be fully liable therefor.
                  No  collection  or  acceptance  of rent by  Landlord  from any
                  person  other  than  Tenant  shall be  deemed a waiver  of any
                  provision of this Article 15 or the acceptance of any assignee
                  or  subtenant  hereunder,  or a release  of Tenant  (or of any
                  successor  of  Tenant  or  any   subtenant).   Notwithstanding
                  anything  to the  contrary  in this  Lease,  if  Tenant or any
                  proposed  Transferee  claims that  Landlord  has  unreasonably
                  withheld  or delayed  its  consent  under  this  Article 15 or
                  otherwise  has  breached  or  acted  unreasonably  under  this
                  Article  15,  their  sole  remedies  shall  be  a  declaratory
                  judgment and an injunction  for the relief sought  without any
                  monetary damages, and Tenant hereby waives all other remedies,
                  including,  without limitation,  any right at law or equity to
                  terminate  this  Lease,  on its own behalf  and, to the extent
                  permitted under all applicable laws, on behalf of the proposed
                  Transferee. Notwithstanding anything to the contrary contained
                  in this  Article 15,  Landlord  agrees that it shall grant its
                  approval  of a  Transfer  by  Tenant  resulting  from a  stock
                  offering  to Justin  Timberlake  or an  affiliate,  so long as
                  Tenant  reasonably  demonstrates  to  Landlord  that:  (x) the
                  financial  condition  of the proposed  transferee  relative to
                  Tenant is at least equal to the financial condition of Tenant


                                      -22-
<PAGE>


                  as of the date of  execution  of this  Lease;  and (y)  Tenant
                  retains control of the entity comprising "Tenant".

                                   ARTICLE 16

                             DAMAGE OR DESTRUCTION

                  If the  Project is damaged by fire or other  insured  casualty
and the insurance  proceeds have been made  available  therefor by the holder or
holders of any mortgages or deeds of trust covering the Premises or the Project,
the damage shall be repaired by Landlord to the extent such  insurance  proceeds
are  available  therefor and  provided  such  repairs  can, in  Landlord's  sole
opinion,  be completed within two hundred seventy (270) days after the necessity
for repairs as a result of such  damage  becomes  known to Landlord  without the
payment of overtime or other premiums, and until such repairs are completed rent
shall be abated in proportion  to the part of the Premises  which is unusable by
Tenant in the conduct of its  business  (but there shall be no abatement of rent
by reason of any portion of the  Premises  being  unusable for a period equal to
one (1) day or less).  However,  if the damage is due to the fault or neglect of
Tenant, its employees, agents, contractors, guests, invitees and the like, there
shall be no abatement of rent, unless and to the extent Landlord receives rental
income  insurance  proceeds.  Upon the occurrence of any damage to the Premises,
Tenant  shall assign to Landlord (or to any party  designated  by Landlord)  all
insurance proceeds payable to Tenant under Article 14(a)(ii)(A) above; PROVIDED,
HOWEVER,  that if the cost of repair of  improvements  within  the  Premises  by
Landlord  exceeds the amount of  insurance  proceeds  received by Landlord  from
Tenant's insurance carrier, as so assigned by Tenant, such excess costs shall be
paid by Tenant to Landlord prior to Landlord's repair of such damage. If repairs
cannot,  in Landlord's  opinion,  be completed  within two hundred seventy (270)
days after the necessity for repairs as a result of such damage becomes known to
Landlord without the payment of overtime or other premiums, Landlord may, at its
option,  either (i) make them in a reasonable  time and in such event this Lease
shall continue in effect and the rent shall be abated,  if at all, in the manner
provided  in this  Article  16, or (ii)  elect not to effect  such  repairs  and
instead terminate this Lease, by notifying Tenant in writing of such termination
within sixty (60) days after  Landlord  learns of the necessity for repairs as a
result of damage,  such notice to include a termination date giving Tenant sixty
(60) days to vacate the Premises.  In addition,  Landlord may elect to terminate
this Lease if the Project  shall be damaged by fire or other  casualty or cause,
whether or not the Premises are affected,  and the damage is not fully  covered,
except for deductible amounts, by Landlord's insurance policies. Finally, if the
Premises or the  Project is damaged to any  substantial  extent  during the last
twelve (12) months of the Term, then notwithstanding  anything contained in this
Article 16 to the  contrary,  Landlord  shall have the option to terminate  this
Lease by giving  written  notice to Tenant of the exercise of such option within
sixty (60) days after Landlord learns of the necessity for repairs as the


                                      -23-
<PAGE>


result of such damage.  A total  destruction of the Project shall  automatically
terminate  this Lease.  Except as provided in this Article 16, there shall be no
abatement  of rent and no  liability  of  Landlord by reason of any injury to or
interference  with  Tenant's  business or property  arising  from such damage or
destruction or the making of any repairs,  alterations or  improvements in or to
any portion of the Project or the Premises or in or to  fixtures,  appurtenances
and equipment therein. Tenant understands that Landlord will not carry insurance
of any kind on Tenant's furniture, furnishings, trade fixtures or equipment, and
that Landlord shall not be obligated to repair any damage thereto or replace the
same. Except for proceeds  relating to Tenant's  furniture,  furnishings,  trade
fixtures and equipment,  Tenant  acknowledges that Tenant shall have no right to
any  proceeds of  insurance  relating to property  damage.  With  respect to any
damage which Landlord is obligated to repair or elects to repair,  Tenant,  as a
material inducement to Landlord entering into this Lease, irrevocably waives and
releases  its  rights  under the  provisions  of  Sections  1932 and 1933 of the
California Civil Code.

                                   ARTICLE 17

                                 SUBORDINATION

                  This  Lease  is  subject  and  subordinate  to all  ground  or
underlying leases, mortgages and deeds of trust which affect the property or the
Project, including all renewals, modifications, consolidations, replacements and
extensions thereof; PROVIDED, HOWEVER, if the lessor under any such lease or the
holder or holders of any such  mortgage or deed of trust shall  advise  Landlord
that they desire or require  this Lease to be prior and superior  thereto,  upon
written  request of  Landlord  to Tenant,  Tenant  agrees to  promptly  execute,
acknowledge  and deliver any and all documents or instruments  which Landlord or
such lessor, holder or holders deem necessary or desirable for purposes thereof.
Landlord  shall  have the right to cause  this Lease to be and become and remain
subject and subordinate to any and all ground or underlying leases, mortgages or
deeds of trust  which may  hereafter  be executed  covering  the  Premises,  the
Project  or  the  property  or  any  renewals,  modifications,   consolidations,
replacements or extensions thereof,  for the full amount of all advances made or
to be made  thereunder  and  without  regard  to the time or  character  of such
advances,  together  with  interest  thereon  and  subject  to all the terms and
provisions thereof; PROVIDED,  HOWEVER, that Landlord obtains from the lender or
other party in question a written  undertaking  in favor of Tenant to the effect
that such lender or other party will not disturb  Tenant's  right of  possession
under this Lease if Tenant is not then or  thereafter  in breach of any covenant
or provision of this Lease. Tenant agrees, within ten (10) days after Landlord's
written request therefor,  to execute,  acknowledge and deliver upon request any
and all documents or instruments requested by Landlord or necessary or proper to
assure the subordination of this Lease to any such mortgages, deeds of trust, or
leasehold  estates.  Tenant agrees that in the event any proceedings are brought
for  the  foreclosure  of any  mortgage  or deed of  trust  or any  deed in lieu
thereof,  to attorn to the  purchaser  or any  successors  thereto upon any such
foreclosure  sale  or  deed in lieu  thereof  as so  requested  to do so by such
purchaser and to recognize such purchaser


                                      -24-
<PAGE>


as the lessor under this Lease; Tenant shall, within five (5) days after request
execute such further  instruments or assurances as such purchaser may reasonably
deem necessary to evidence or confirm such attornment.  Tenant agrees to provide
copies of any notices of Landlord's default under this Lease to any mortgagee or
deed of trust  beneficiary  whose address has been provided to Tenant and Tenant
shall  provide  such  mortgagee  or deed of  trust  beneficiary  a  commercially
reasonable  time after  receipt  of such  notice  within  which to cure any such
default.  Tenant waives the provisions of any current or future statute, rule or
law which may give or purport to give Tenant any right or election to  terminate
or  otherwise  adversely  affect  this Lease and the  obligations  of the Tenant
hereunder in the event of any foreclosure proceeding or sale.

                                   ARTICLE 18

                                 EMINENT DOMAIN

                  If the whole of the Premises or the Project or so much thereof
as to render  the  balance  unusable  by Tenant  shall be taken  under  power of
eminent domain, or is sold,  transferred or conveyed in lieu thereof, this Lease
shall automatically terminate as of the date of such condemnation,  or as of the
date possession is taken by the condemning  authority,  at Landlord's option. No
award for any partial or entire taking shall be  apportioned,  and Tenant hereby
assigns to Landlord any award which may be made in such taking or  condemnation,
together with any and all rights of Tenant now or hereafter arising in or to the
same or any part thereof; PROVIDED, HOWEVER, that nothing contained herein shall
be deemed to give  Landlord  any  interest in or to require  Tenant to assign to
Landlord any award made to Tenant for the taking of personal  property and trade
fixtures  belonging to Tenant and  removable by Tenant at the  expiration of the
Term  hereof as provided  hereunder  or for the  interruption  of, or damage to,
Tenant's  business.  In the event of a partial taking  described in this Article
18, or a sale, transfer or conveyance in lieu thereof,  which does not result in
a  termination  of this Lease,  the rent shall be  apportioned  according to the
ratio that the part of the  Premises  remaining  useable by Tenant  bears to the
total area of the  Premises.  Tenant  hereby  waives any and all rights it might
otherwise  have  pursuant to Section  1265.130 of the  California  Code of Civil
Procedure.

                                   ARTICLE 19

                                    DEFAULT

                  Each of the  following  acts or  omissions of Tenant or of any
guarantor of Tenant's performance hereunder, or occurrences, shall constitute an
"EVENT OF DEFAULT":

         (a)      Failure or refusal to pay Basic Rental, Additional Rent or any
                  other amount to be paid by Tenant to Landlord hereunder within
                  three (3)  calendar  days after notice that the same is due or
                  payable hereunder; said three (3) day period shall be in lieu


                                      -25-
<PAGE>


                  of, and not in addition to, the notice requirements of Section
                  1161 of the California  Code of Civil Procedure or any similar
                  or successor law;

         (b)      Except as set forth in items  (a)  above and (c)  through  and
                  including  (g) below,  failure to perform or observe any other
                  covenant  or  condition  of  this  Lease  to be  performed  or
                  observed  within thirty (30) days following  written notice to
                  Tenant of such  failure.  Such thirty (30) day notice shall be
                  in lieu of, and not in addition to, any required under Section
                  1161 of the California  Code of Civil Procedure or any similar
                  or successor law;

         (c)      Abandonment  or  vacating  or  failure  to  accept  tender  of
                  possession of the Premises or any significant portion thereof;

         (d)      The taking in  execution  or by similar  process or law (other
                  than by eminent domain) of the estate hereby created;

         (e)      The filing by Tenant or any  guarantor  hereunder in any court
                  pursuant  to  any  statute  of a  petition  in  bankruptcy  or
                  insolvency  or  for  reorganization  or  arrangement  for  the
                  appointment  of a  receiver  of all or a portion  of  Tenant's
                  property; the filing against Tenant or any guarantor hereunder
                  of any such petition,  or the commencement of a proceeding for
                  the  appointment  of a trustee,  receiver  or  liquidator  for
                  Tenant,  or  for  any  guarantor  hereunder,  or of any of the
                  property  of  either,  or a  proceeding  by  any  governmental
                  authority for the  dissolution or liquidation of Tenant or any
                  guarantor hereunder, if such proceeding shall not be dismissed
                  or  trusteeship  discontinued  within  thirty  (30) days after
                  commencement  of such  proceeding or the  appointment  of such
                  trustee or receiver;  or the making by Tenant or any guarantor
                  hereunder  of an  assignment  for the  benefit  of  creditors.
                  Tenant hereby  stipulates to the lifting of the automatic stay
                  in effect and relief from such stay for  Landlord in the event
                  Tenant  files a petition  under the United  States  Bankruptcy
                  laws,  for the  purpose of  Landlord  pursuing  its rights and
                  remedies against Tenant and/or a guarantor of this Lease;

         (f)      Tenant's  failure to cause to be released any mechanics' liens
                  filed  against the Premises or the Project  within twenty (20)
                  days  after  the  date  the  same  shall  have  been  filed or
                  recorded; or

         (g)      Tenant's  failure  to  observe  or  perform  according  to the
                  provisions  of Article 17 or 25 within two (2)  business  days
                  after notice from Landlord.

                  All  defaults by Tenant of any  covenant or  condition of this
                  Lease shall be deemed by the parties hereto to be material.


                                      -26-
<PAGE>


                                   ARTICLE 20

                                    REMEDIES

         (a)      Upon the occurrence of an Event of Default under this Lease as
                  provided in Article 19 hereof,  Landlord  may  exercise all of
                  its  remedies as may be permitted  by law,  including  but not
                  limited  to the  remedy  provided  by  Section  1951.4  of the
                  California  Civil  Code,  and  including  without  limitation,
                  terminating  this Lease,  reentering the Premises and removing
                  all persons and  property  therefrom,  which  property  may be
                  stored by Landlord at a warehouse  or  elsewhere  at the risk,
                  expense and for the account of Tenant.  If Landlord  elects to
                  terminate  this Lease,  Landlord  shall be entitled to recover
                  from Tenant the  aggregate  of all amounts  permitted  by law,
                  including  but not  limited  to (i) the  worth  at the time of
                  award of the amount of any unpaid  rent which had been  earned
                  at the time of such  termination;  plus  (ii) the worth at the
                  time of award of the  amount by which the  unpaid  rent  which
                  would have been  earned  after  termination  until the time of
                  award  exceeds  the  amount of such  rental  loss that  Tenant
                  proves  could  have been  reasonably  avoided;  plus (iii) the
                  worth at the time of award of the  amount by which the  unpaid
                  rent for the balance of the Lease Term after the time of award
                  exceeds  the amount of such  rental  loss that  Tenant  proves
                  could have been reasonably avoided; plus (iv) any other amount
                  necessary  to  compensate   Landlord  for  all  the  detriment
                  proximately   caused  by  Tenant's   failure  to  perform  its
                  obligations  under this Lease or which in the ordinary  course
                  of things  would be likely to result  therefrom,  specifically
                  including  but  not  limited  to,  brokerage  commissions  and
                  advertising  expenses  incurred,  expenses of  remodeling  the
                  Premises or any portion thereof for a new tenant,  whether for
                  the same or a different use, and any special  concessions made
                  to obtain a new tenant; and (v) at Landlord's  election,  such
                  other  amounts in addition to or in lieu of the  foregoing  as
                  may be permitted from time to time by applicable law. The term
                  "rent" as used in this Article 20(a) shall be deemed to be and
                  to mean all sums of every nature required to be paid by Tenant
                  pursuant  to the terms of this Lease to  Landlord.  As used in
                  items (i) and (ii),  above,  the  "worth at the time of award"
                  shall be computed  by allowing  interest at the rate set forth
                  in item (e),  below,  but in no case  greater than the maximum
                  amount  of such  interest  permitted  by law.  As used in item
                  (iii),  above,  the  "worth  at the  time of  award"  shall be
                  computed by  discounting  such amount at the discount  rate of
                  the Federal Reserve Bank of San Francisco at the time of award
                  plus one percent (1%).

         (b)      Nothing  in  this   Article  20  shall  be  deemed  to  affect
                  Landlord's   right  to   indemnification   for   liability  or
                  liabilities arising prior to the termination of this Lease for
                  personal injuries or property damage under the indemnification
                  clause or clauses contained in this Lease.

         (c)      Notwithstanding  anything to the  contrary  set forth  herein,
                  Landlord's   re-entry  to  perform  acts  of   maintenance  or
                  preservation  of or in  connection  with  efforts to relet the
                  Premises  or any  portion  thereof,  or the  appointment  of a
                  receiver  upon  Landlord's  initiative  to protect  Landlord's
                  interest under this Lease shall not


                                      -27-
<PAGE>


         (d)      All rights,  powers and  remedies of  Landlord  hereunder  and
                  under any other  agreement  now or hereafter in force  between
                  Landlord and Tenant shall be  cumulative  and not  alternative
                  and shall be in addition to all  rights,  powers and  remedies
                  given to  Landlord  by law,  and the  exercise  of one or more
                  rights  or  remedies  shall  not  impair  Landlord's  right to
                  exercise any other right or remedy.

         (e)      Any amount due from Tenant to Landlord  hereunder which is not
                  paid  when due  shall  bear  interest  at the  lower of twelve
                  percent (12%) per annum or the maximum lawful rate of interest
                  from the due date until paid,  unless  otherwise  specifically
                  provided  herein,  but the payment of such interest  shall not
                  excuse or cure any  default  by Tenant  under this  Lease.  In
                  addition  to such  interest:  (i) if Basic  Rental is not paid
                  within  ten (10)  days  after the same is due,  a late  charge
                  equal to five  percent  (5%) of the  amount  overdue  or $100,
                  whichever  is greater,  shall be assessed and shall accrue for
                  each  calendar  month  or  part  thereof  until  such  rental,
                  including the late charge,  is paid in full, which late charge
                  Tenant hereby  agrees is a reasonable  estimate of the damages
                  Landlord shall suffer as a result of Tenant's late payment and
                  (ii) an  additional  charge of $25 shall be  assessed  for any
                  check given to Landlord by or on behalf of Tenant which is not
                  honored  by  the  drawee   thereof;   which  damages   include
                  Landlord's   additional   administrative   and   other   costs
                  associated with such late payment and  unsatisfied  checks and
                  the parties agree that it would be  impracticable or extremely
                  difficult to fix Landlord's  actual damage in such event. Such
                  charges for interest and late payments and unsatisfied  checks
                  are separate and  cumulative  and are in addition to and shall
                  not  diminish  or  represent  a  substitute  for any or all of
                  Landlord's  rights or remedies  under any other  provision  of
                  this Lease.

                                   ARTICLE 21

                        TRANSFER OF LANDLORD'S INTEREST

                  In the event of any  transfer  or  termination  of  Landlord's
interest  in  the  Premises  or  the  Project  by  sale,  assignment,  transfer,
foreclosure,  deed-in-lieu  of  foreclosure or otherwise,  whether  voluntary or
involuntary, Landlord shall be automatically relieved of any and all obligations
and liabilities on the part of Landlord from and after the date of such transfer
or termination, including furthermore without


                                      -28-
<PAGE>


limitation, the obligation of Landlord under Article 4 and California Civil Code
1950.7, above, to return the security deposit, provided said security deposit is
transferred to said  transferee and that said  transferee  agrees to be bound by
the terms of this Lease. Tenant agrees to attorn to the transferee upon any such
transfer and to  recognize  such  transferee  as the lessor under this Lease and
Tenant  shall,  within  five  (5)  days  after  request,  execute  such  further
instruments or assurances as such  transferee  may reasonably  deem necessary to
evidence or confirm such attornment.

                                   ARTICLE 22

                                     BROKER

                  In connection with this Lease,  Tenant Warrants and represents
that it has had dealings only with firm(s) set forth in Article 1.H of the Basic
Lease  Provisions and that it knows of no other person or entity who is or might
be entitled to a  commission,  finder's fee or other like payment in  connection
herewith  and does  hereby  indemnify  and agree to hold  Landlord,  its agents,
members,  partners,   representatives,   officers,   affiliates,   shareholders,
employees,  successors  and assigns  harmless from and against any and all loss,
liability  and  expenses  that  Landlord  may incur  should  such  warranty  and
representation prove incorrect, inaccurate or false.

                                   ARTICLE 23

                                    PARKING

                  Tenant   shall   rent  from   Landlord,   commencing   on  the
Commencement  Date, the number of unreserved parking passes set forth in Article
1.I of the Basic Lease  Provisions,  which  parking  passes shall pertain to the
Project parking  facility.  Tenant shall pay to Landlord for automobile  parking
passes the  prevailing  rate  charged  from time to time at the location of such
parking passes.  Landlord's  prevailing rate as of the Effective Date is $100.00
per  unreserved  space and  $150.00  per  reserved  space,  subject to change in
accordance with this Article.  In addition,  Tenant shall be responsible for the
full amount of any taxes  imposed by any  governmental  authority in  connection
with the  renting  of such  parking  passes by Tenant or the use of the  parking
facility  by  Tenant.  Tenant's  continued  right to use the  parking  passes is
conditioned  upon  Tenant  abiding  by  all  rules  and  regulations  which  are
prescribed  from time to time for the orderly  operation  and use of the parking
facility  where the parking  passes are located,  including any sticker or other
identification  system established by Landlord,  Tenant's  cooperation in seeing
that   Tenant's   employees  and  visitors  also  comply  with  such  rules  and
regulations,  and  Tenant  not  being in  default  under  this  Lease.  Landlord
specifically  reserves  the right to change  the  size,  configuration,  design,
layout and all other aspects of the Project  parking  facility at any time,  and
Tenant  acknowledges  and  agrees  that  Landlord  may,  without  incurring  any
liability  to Tenant and without any  abatement  of rent under this Lease,  from
time to time,  close-off or restrict access to the Project parking  facility for
purposes of  permitting or  facilitating  any such  construction,  alteration or
improvements. Landlord


                                      -29-
<PAGE>


may delegate its responsibilities hereunder to a parking operator or a lessee of
the parking  facility in which case such  parking  operator or lessee shall have
all the rights of control  attributed hereby to the Landlord.  Landlord reserves
the right to require  that parking be valet or  attended,  requiring  parkers to
leave keys with  parking  management  personnel,  at  Landlord's  election.  The
parking  passes  rented by Tenant  pursuant to this  Article 23 are  provided to
Tenant  solely for use by  Tenant's  own  personnel  and such  passes may not be
transferred,  assigned,  subleased  or  otherwise  alienated  by Tenant  without
Landlord's prior approval. Tenant may validate visitor parking by such method or
methods as the Landlord may establish,  at the validation rate from time to time
generally applicable to visitor parking.

                                   ARTICLE 24

                                     WAIVER

                  No waiver by Landlord of any  provision of this Lease shall be
deemed to be a waiver of any other provision hereof or of any subsequent  breach
by Tenant of the same or any other provision.  No provision of this Lease may be
waived by Landlord,  except by an  instrument  in writing  executed by Landlord.
Landlord's  consent to or  approval  of any act by Tenant  requiring  Landlord's
consent or approval shall not be deemed to render  unnecessary  the obtaining of
Landlord's  consent to or approval of any subsequent  act of Tenant,  whether or
not  similar to the act so  consented  to or  approved.  No act or thing done by
Landlord or  Landlord's  agents during the Term of this Lease shall be deemed an
acceptance  of a surrender  of the  Premises,  and no  agreement  to accept such
surrender  shall be valid unless in writing and signed by Landlord.  Any payment
by Tenant or receipt by Landlord  of an amount  less than the total  amount then
due  hereunder  shall be deemed to be in partial  payment only thereof and not a
waiver of the balance  due or an accord and  satisfaction,  notwithstanding  any
statement or  endorsement  to the contrary on any check or any other  instrument
delivered concurrently therewith or in reference thereto. Accordingly,  Landlord
may accept any such amount and  negotiate  any such check  without  prejudice to
Landlord's  right to recover all  balances due and owing and to pursue its other
rights against Tenant under this Lease, regardless of whether Landlord makes any
notation on such  instrument of payment or otherwise  notifies  Tenant that such
acceptance or negotiation is without prejudice to Landlord's rights.

                                   ARTICLE 25

                              ESTOPPEL CERTIFICATE

                  Tenant shall, at any time and from time to time, upon not less
than ten (10) days' prior written notice from Landlord, execute, acknowledge and
deliver to Landlord a statement in writing certifying the following information,
(but not limited to the following  information in the event further  information
is requested by Landlord):  (i) 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 modified, is in full force and


                                      -30-
<PAGE>


effect);  (ii) the  dates to which the  rental  and  other  charges  are paid in
advance, if any; (iii) the amount of Tenant's security deposit, if any; and (iv)
acknowledging that there are not, to Tenant's knowledge, any uncured defaults on
the part of Landlord  hereunder,  and no events or conditions  then in existence
which, with the passage of time or notice or both, would constitute a default on
the  part  of  Landlord  hereunder,  or  specifying  such  defaults,  events  or
conditions,  if any are claimed. It is expressly  understood and agreed that any
such statement may be relied upon by any  prospective  purchaser or encumbrancer
of all or any portion of the Real  Property.  Tenant's  failure to deliver  such
statement  within such time shall  constitute  an  admission  by Tenant that all
statements contained therein are true and correct.  Tenant agrees to execute all
documents required in accordance with this Article 25 within ten (10) days after
delivery of said  documents.  Tenant  hereby  irrevocably  appoints  Landlord as
Tenant's  attorney-in-fact  and in Tenant's name, place and stead to execute any
and all  documents  described in this Article 25 if Tenant fails to do so within
the specified time period.

                                   ARTICLE 26

                             LIABILITY OF LANDLORD

                  Notwithstanding  anything in this Lease to the  contrary,  any
remedy of Tenant for the  collection of a judgment (or other  judicial  process)
requiring  the  payment  of money by  Landlord  in the event of any  default  by
Landlord  hereunder or any claim,  cause of action or  obligation,  contractual,
statutory or otherwise by Tenant against Landlord concerning,  arising out of or
relating  to any  matter  relating  to this Lease and all of the  covenants  and
conditions or any obligations,  contractual,  statutory,  or otherwise set forth
herein,  shall be limited solely and  exclusively to an amount which is equal to
the interest of Landlord in and to the Project.  No other  property or assets of
Landlord,  or any member,  officer,  director,  shareholder,  partner,  trustee,
agent, servant or employee of Landlord (the  "REPRESENTATIVE")  shall be subject
to levy,  execution  or other  enforcement  procedure  for the  satisfaction  of
Tenant's remedies under or with respect to this Lease or Landlord's  obligations
to Tenant,  whether  contractual,  statutory or otherwise,  the  relationship of
Landlord and Tenant  hereunder,  or Tenant's  use or occupancy of the  Premises.
Tenant further understands that any liability, duty or obligation of Landlord to
Tenant shall  automatically  cease and terminate as of the date that Landlord or
any of Landlord's Representatives no longer have any right, title or interest in
or to the Project for any liabilities occurring from and after such date.

                                   ARTICLE 27

                              INABILITY TO PERFORM


                  Except as  otherwise  provided  hereafter,  and except for the
obligation to make payments of any kind hereunder,  each party shall be entitled
to an extension of the date of any performance required of such party under this
Lease in  accordance  with the terms of this  Article  27; if the failure of the
party to duly perform was solely because of a

                                      -31-
<PAGE>




Force Majeure Event  (defined  below);  provided  however,  that a Force Majeure
Event shall not be  recognized  under this lease unless (1) the party seeking to
assert such an event gives written no e other party,  which notice shall explain
in reasonable detail the nature of the Force Majeure Event, the obligations that
have been that have been affected by the Force Majeure Event, and how such Force
Majeure Event has impaired the performance of such  obligations  ("FORCE MAJEURE
EVENT NOTICE"), and (2) such Force Majeure Event actually and materially impairs
the due performance of such parties' obligations and continues for not less than
five  consecutive  business  days. So long as Force Majeure Even Notice has been
delivered,  the performance required by the notifying party shall be extended on
a day-to-day basis commencing on the date the Force Majeure Event first occurred
until such Force  Majeure Event has  terminated.  In the event the Force Majeure
Event continues for more than sixty (60) business days, either party may, on the
giving of written  notice to the other,  terminate  this Lease.  "FORCE  MAJEURE
EVENT" shall be an act of God, riot, war, civil unrest,  flood,  earthquake,  or
other cause beyond a party's reasonable control (including,  without limitation,
any mechanical,  electronic,  or communications  failure,  but excluding failure
caused by a party's financial condition or an act of negligence).

                                   ARTICLE 28

                                HAZARDOUS WASTE

         (a)      Tenant  shall not cause or permit any  Hazardous  Material (as
                  defined in Article 28(d),  below) to be brought,  kept or used
                  in or about the  Project by  Tenant,  its  agents,  employees,
                  contractors, or invitees. Tenant indemnifies Landlord from and
                  against any breach by Tenant of the obligations  stated in the
                  preceding  sentence,  and agrees to defend  and hold  Landlord
                  harmless  from  and  against  any and all  claims,  judgments,
                  damages,  penalties,  fines,  costs,  liabilities,  or  losses
                  (including,  without  limitation,  diminution  in value of the
                  Project,  damages  for  the  loss  or  restriction  or  use of
                  rentable  or usable  space or of any  amenity of the  Project,
                  damages  arising from any adverse impact or marketing of space
                  in the  Project,  and  sums  paid  in  settlement  of  claims,
                  attorneys' fees, consultant fees, and expert fees) which arise
                  during  or after  the Term of this  Lease as a result  of such
                  breach.  This  indemnification of Landlord by Tenant includes,
                  without  limitation,  costs  incurred in  connection  with any
                  investigation  of site  conditions  or any cleanup,  remedial,
                  removal,  or restoration work required by any federal,  state,
                  or local governmental agency or political  subdivision because
                  of Hazardous  Material  present in the soil or ground water on
                  or under the Project.  Without limiting the foregoing,  if the
                  presence of any  Hazardous  Material on the Project  caused or
                  permitted  by  Tenant  results  in  any  contamination  of the
                  Project and subject to the provisions of Articles 9, 10 and 11
                  hereof,  Tenant  shall  promptly  take all actions at its sole
                  expense  as  are  necessary  to  return  the  Project  to  the
                  condition  existing  prior  to the  introduction  of any  such
                  Hazardous  Material,  and the contractors to be used by Tenant
                  for such work must be approved  by  Landlord,  which  approval
                  shall not be  unreasonably  withheld  so long as such  actions
                  would not potentially have any material  adverse  long-term or
                  short-


                                      -32-
<PAGE>


                  term effect on the Project and so long as such  actions do not
                  materially interfere with the use and enjoyment of the Project
                  by the other tenants thereof.

         (b)      Landlord  and  Tenant  acknowledge  that  Landlord  may become
                  legally  liable  for the  costs  of  complying  with  Laws (as
                  defined  in  Article  28(e),   below)  relating  to  Hazardous
                  Material which are not the  responsibility  of Landlord or the
                  responsibility  of  Tenant,   including  the  following:   (i)
                  Hazardous  Material present in the soil or ground water on the
                  Project of which Landlord has no knowledge as of the Effective
                  Date of this  Lease;  (ii) a change  in Laws  which  relate to
                  Hazardous Material which make that Hazardous Material which is
                  present on the Real Property as of the Effective  Date of this
                  Lease,  whether  known or unknown to Landlord,  a violation of
                  such new Laws; (iii) Hazardous Material that migrates,  flows,
                  percolates, diffuses, or in any way moves on to, or under, the
                  Project  after  the  Effective  Date  of this  Lease;  or (iv)
                  Hazardous Material present on or under the Project as a result
                  of any discharge,  dumping or spilling (whether  accidental or
                  otherwise)  on the Project by other  lessees of the Project or
                  their  agents,  employees,  contractors,  or  invitees,  or by
                  others.  Accordingly,  Landlord and Tenant agree that the cost
                  of complying  with Laws relating to Hazardous  Material on the
                  Project  for which  Landlord  is legally  liable and which are
                  paid or incurred by Landlord  shall be an Operating  Cost (and
                  Tenant  shall pay  Tenant's  Proportionate  Share  thereof  in
                  accordance  with Article 3) unless the cost of such compliance
                  as between Landlord and Tenant is made the  responsibility  of
                  Tenant  pursuant to Article  28(a),  above.  To the extent any
                  such  Operating   Cost  relating  to  Hazardous   Material  is
                  subsequently  recovered or reimbursed  through  insurance,  or
                  recovery  from  responsible  third  parties  or other  action,
                  Tenant shall be entitled to a proportionate  reimbursement  to
                  the  extent  it has paid its share of such  Operating  Cost to
                  which such recovery or reimbursement relates.

         (c)      It shall not be  unreasonable  for  Landlord to  withhold  its
                  consent  to  any   proposed   Transfer  if  (i)  the  proposed
                  Transferee's  anticipated  use of the  Premises  involves  the
                  generation,  storage, use, treatment, or disposal of Hazardous
                  Material;  (ii) the proposed  Transferee  has been required by
                  any prior landlord,  lender, or governmental authority to take
                  remedial   action  in  connection   with  Hazardous   Material
                  contaminating  a property if the  contamination  resulted from
                  such Transferee's  actions or use of the property in question;
                  or (iii) the proposed  Transferee is subject to an enforcement
                  order issued by any governmental  authority in connection with
                  the use, disposal, or storage of a Hazardous Material.

         (d)      As used  herein,  the  term  "HAZARDOUS  MATERIAL"  means  any
                  hazardous or toxic substance,  material,  or waste which is or
                  becomes  regulated by any local  governmental  authority,  the
                  State of California or the United States Government.  The term
                  "Hazardous   Material"  includes,   without  limitation,   any
                  material  or  substance  which is (i)  defined  as  "Hazardous
                  Waste," "Extremely Hazardous Waste," or "Restricted  Hazardous
                  Waste"  under  Section  25115,  25117 or  25122.7,  or  listed
                  pursuant to Section 25140, of the California Health and Safety
                  Code, Division 20, Chapter 6.5


                                      -33-
<PAGE>



                  (Hazardous  Waste Control  Law),  (ii) defined as a "Hazardous
                  Substance"  under Section 25316 of the  California  Health and
                  Safety      Code,      Division      20,      Chapter      6.8
                  (Carpenter-Presley-Tanner  Hazardous  Substance  Account Act),
                  (iii)   defined   as  a   "Hazardous   Material,"   "Hazardous
                  Substance,"  or  "Hazardous  Waste" under Section 25501 of the
                  California  Health and Safety Code,  Division 20, Chapter 6.95
                  (Hazardous  Materials  Release  Response Plans and Inventory),
                  (iv) defined as a "Hazardous Substance" under Section 25281 of
                  the  California  Health and Safety Code,  Division 20, Chapter
                  6.7  (Underground  Storage  of  Hazardous   Substances),   (v)
                  petroleum,  (vi)  asbestos,  (vii) listed  under  Article 9 or
                  defined  as  Hazardous  or  extremely  hazardous  pursuant  to
                  Article 11 of Title 22 of the California  Administrative Code,
                  Division 4,  Chapter 20,  (viii)  designated  as a  "Hazardous
                  Substance"  pursuant  to  Section  311  of the  Federal  Water
                  Pollution  Control Act (33 U.S.C. ss. 1317), (ix) defined as a
                  "Hazardous  Waste"  pursuant  to Section  1004 of the  Federal
                  Resource  Conservation and Recovery Act, 42 U.S.C. ss. 6901 et
                  seq.  (42 U.S.C.  ss.  6903),  or (x) defined as a  "Hazardous
                  Substance"  pursuant  to  Section  101  of  the  Comprehensive
                  Environmental  Response,  Compensation  and Liability  Act, 42
                  U.S.C. ss. 9601 et seq. (42 U.S.C. ss. 9601).

         (e)      As used herein, the term "LAWS" means any applicable  federal,
                  state or local laws,  ordinances,  or regulations  relating to
                  any  Hazardous  Material  affecting  the  Project,  including,
                  without  limitation,  the laws,  ordinances,  and  regulations
                  referred to in Article 28(d), above.

                                   ARTICLE 29

                   SURRENDER OF PREMISES; REMOVAL OF PROPERTY

         (a)      The  voluntary  or other  surrender of this Lease by Tenant to
                  Landlord,  or a mutual  termination  hereof,  shall not work a
                  merger,  and shall at the  option of  Landlord,  operate as an
                  assignment  to it of  any  or all  subleases  or  subtenancies
                  affecting the Premises.

         (b)      Upon the  expiration  of the Term of this  Lease,  or upon any
                  earlier  termination  of this  Lease,  Tenant  shall  quit and
                  surrender  possession  of the  Premises to Landlord in as good
                  order and  condition as the same are now and  hereafter may be
                  improved by Landlord or Tenant,  reasonable  wear and tear and
                  repairs which are Landlord's  obligation excepted,  and shall,
                  without  expense  to  Landlord,  remove or cause to be removed
                  from the  Premises  all debris  and  rubbish,  all  furniture,
                  equipment, business and trade fixtures,  free-standing cabinet
                  work,  moveable  partitioning  and other  articles of personal
                  property  owned by Tenant or  installed or placed by Tenant at
                  its own expense in the Premises,  and all similar  articles of
                  any  other  persons  claiming  under  Tenant  unless  Landlord
                  exercises  its option to have any  subleases  or  subtenancies
                  assigned  to it,  and  Tenant  shall  repair all damage to the
                  Premises  resulting from the  installation and removal of such
                  items to be removed.


                                      -34-
<PAGE>


         (c)      Whenever  Landlord  shall  reenter the Premises as provided in
                  Article 12 hereof, or as otherwise provided in this Lease, any
                  property of Tenant not  removed by Tenant upon the  expiration
                  of the Term of this  Lease (or within  forty-eight  (48) hours
                  after  a  termination  by  reason  of  Tenant's  default),  as
                  provided  in this Lease,  shall be  considered  abandoned  and
                  Landlord  may remove  any or all of such items and  dispose of
                  the same in any manner or store the same in a public warehouse
                  or  elsewhere  for the  account and at the expense and risk of
                  Tenant,  and if Tenant  shall  fail to pay the cost of storing
                  any such  property  after it has been  stored  for a period of
                  ninety (90) days or more, Landlord may sell any or all of such
                  property at public or private sale, in such manner and at such
                  times and places as Landlord, in its sole discretion, may deem
                  proper,  without  notice or to  demand  upon  Tenant,  for the
                  payment of all or any part of such  charges or the  removal of
                  any such  property,  and shall apply the proceeds of such sale
                  as  follows:  first,  to the cost and  expense  of such  sale,
                  including  reasonable  attorneys' fees for services  rendered;
                  second,  to the  payment of the cost of or charges for storing
                  any such property;  third, to the payment of any other sums of
                  money which may then or  thereafter  be due to  Landlord  from
                  Tenant under any of the terms hereof; and fourth, the balance,
                  if any, to Tenant.

         (d)      All  fixtures,  equipment,  Alterations  and/or  appurtenances
                  attached to or built into the Premises  prior to or during the
                  Term, whether by Landlord or Tenant and whether at the expense
                  of Landlord or Tenant, or of both, shall be and remain part of
                  the  Premises and shall not be removed by Tenant at the end of
                  the Term unless otherwise expressly provided for in this Lease
                  or unless such removal is required by Landlord pursuant to the
                  provisions  of  Article  9 above.  Such  fixtures,  equipment,
                  Alterations,   additions,  improvements  and/or  appurtenances
                  shall  include  but not be limited  to:  all floor  coverings,
                  drapes, paneling,  built-in cabinetry,  molding, doors, vaults
                  (including vault doors), plumbing systems, electrical systems,
                  lighting systems, silencing equipment,  communication systems,
                  all fixtures and outlets for the systems  mentioned  above and
                  for all telephone,  radio,  telegraph and television purposes,
                  and any special flooring or ceiling installations.

                                   ARTICLE 30

                                OPTION TO EXTEND

         (a)      If, at the end of the Term of this Lease, (a) Tenant is not in
                  default of any of the terms,  conditions  or covenants of this
                  Lease,  beyond any applicable  delivered notice and subsequent
                  cure  period,  and (b) Tenant has not  assigned  or sublet the
                  Premises in  violation  of Article 17, then Tenant  shall have
                  the  option to extend  the Lease  Term for one (1)  additional
                  period  of three  (3) years  (hereinafter  referred  to as the
                  "OPTION PERIOD") upon the same terms and conditions  contained
                  in this Lease with the following exceptions:

                  (i)      The Basic  Rental for the Option  Period  shall be as
                           set forth in Article 30(c), below;


                                      -35-
<PAGE>


                  (ii)     There  shall be no  further  extensions  of the Lease
                           Term  following  the  expiration of the Option Period
                           unless granted by Landlord in writing,  in Landlord's
                           sole discretion; and

                  (iii)    Tenant  will not be granted  any rental  concessions,
                           rental abatement or finish-out  allowances during any
                           Option Period.

         (b)      If Tenant  desires to exercise  its option to extend the Lease
                  Term  (subject to Tenant's  compliance  with the standards set
                  forth  herein),  Tenant  will  notify  Landlord  in writing of
                  Tenant's  intention to do so no later than nine (9) months and
                  no more than twelve (12) months prior to the  expiration  date
                  of the then  current  Lease  Term.  After  proper  and  timely
                  exercise of the extension option by Tenant,  all references in
                  this Lease to "Lease  Term" of "Term" shall be  considered  to
                  mean the Lease Term as extended,  and all  references  in this
                  Lease to the  Expiration  Date or to the end of the Lease Term
                  shall  be  considered  to mean the  termination  or end of the
                  Option Period.

         (c)      The  Basic  Rental  for the  Option  Period  shall be the Fair
                  Market  Rent (as defined  hereinafter)  for the  Premises  and
                  shall  increase  annually if so  dictated by the then  current
                  market; provided,  however, that such Basic Rental shall in no
                  event be less  than the  Basic  Rental in effect at the end of
                  the  then-expiring  Term.  Tenant's  exercise of the option to
                  extend shall, if Landlord so elects in its absolute discretion
                  be ineffective in the event that an Event of Default by Tenant
                  remains uncured at the time of exercise or at the commencement
                  of the  Option  Period.  Tenant's  option to  extend  the Term
                  described in this Article 30 is personal to Tenant and may not
                  be exercised by or on behalf of any assignee or subtenant.

         (d)      FAIR MARKET RENT.  The  provisions of this Section shall apply
                  in any  instance  in which this Lease  provides  that the Fair
                  Market Rent is to apply.

                  (i)      FAIR MARKET RENT. "FAIR MARKET RENT" means the annual
                           amount per square foot (exclusive of occupancy costs)
                           that  a  willing  tenant  would  pay  and  a  willing
                           landlord  would accept in arm's length  negotiations,
                           without any  additional  inducements,  for a lease of
                           the  applicable  space on the  applicable  terms  and
                           conditions  (including the Additional Rent terms) for
                           the applicable period of time. Fair Market Rent shall
                           be  determined  by  considering  the most  recent new
                           leases  (and  market  renewals  and  extensions,   if
                           applicable)  in the Project and in comparable  office
                           buildings in the downtown Los Angeles  area. If there
                           are no such  leases  that are  recent,  consideration
                           shall be given to the most  recent  new  leases  (and
                           market  renewals and  extensions,  if  applicable) in
                           other comparable  office building  locations near the
                           Project.

                  (ii)     DETERMINATION  BY LANDLORD.  Landlord shall initially
                           determine the Fair Market Rent in each instance,  and
                           shall give Tenant  notice (the "MARKET RENT  NOTICE")
                           of such determination and the basis on which such


                                      -36-
<PAGE>


                           determination  was  made on or  before  the  60th day
                           prior to the date on which such  determination  is to
                           take effect,  or as soon  thereafter as is reasonably
                           practicable.

                  (iii)    DISPUTES  REGARDING  FAIR MARKET  RENT.  In the event
                           that  Tenant  notifies  Landlord  in  writing,  on or
                           before the 10th  business  day  following  any Market
                           Rent   Notice,   that  Tenant   disagrees   with  the
                           applicable  determination,  Landlord and Tenant shall
                           negotiate  in good  faith  to  resolve  such  dispute
                           within 10 business days  thereafter.  If not resolved
                           within such period, the issue shall be referred to an
                           individual (the "EXPERT")  reasonably  agreed upon by
                           Landlord  and  Tenant  or  (failing  such  agreement)
                           appointed  by two  individuals,  one of which such be
                           chosen by  Landlord  and one of which shall be chosen
                           by  Tenant.  The  Expert  shall in any event  have at
                           least 5 years of experience  in leasing  office space
                           in downtown Los Angeles and shall be independent. The
                           Expert  shall be deemed to be acting as an expert and
                           not  as  an  arbitrator,   and  shall  determine  the
                           applicable  Fair Market Rent within 30 days following
                           his or her  appointment.  The Fair  Market Rent which
                           shall apply for purposes of the applicable  provision
                           of this Lease shall be the rent  determined by either
                           Landlord or Tenant  which is closest to the  Expert's
                           determination,  and the  party  that  is not  closest
                           shall pay all of the costs and  expenses  incurred in
                           connection  with the appointment of, and services of,
                           the Expert.  Until any such dispute is resolved,  any
                           applicable   payments  due  under  this  Lease  shall
                           correspond  to  Landlord's   determination   and,  if
                           applicable, Landlord shall refund any overpayments to
                           Tenant,  within thirty (30)  business days  following
                           the final resolution of the dispute.

         (e)      LANDLORD'S  TERMINATION  RIGHT.  In the event that  Tenant has
                  properly and timely exercised its option to extend the Term as
                  described  in this  Article  30,  Landlord  shall  at any time
                  during the Option Period have the right to terminate the Lease
                  if  Landlord  has  received  governmental  approvals  for  the
                  redevelopment  of  the  Project.  Such  termination  shall  be
                  effective  one hundred  eighty  (180) days after  Landlord has
                  delivered  written  notice of its  election  to  terminate  to
                  Tenant,  and so long as Tenant is not in  default  under  this
                  Lease,  Basic  Rental  for the final  ninety  (90) days of the
                  reduced Term shall be abated.

                                   ARTICLE 31

                                 MISCELLANEOUS

         (a)      SEVERABILITY;  ENTIRE  AGREEMENT.  Any provision of this Lease
                  which shall prove to be invalid,  void, or illegal shall in no
                  way affect,  impair or invalidate any other  provision  hereof
                  and such  other  provisions  shall  remain  in full  force and
                  effect.  This Lease and the Exhibits and any Addendum attached
                  hereto  constitute  the entire  agreement  between the parties
                  hereto with respect to the subject matter hereof, and no prior
                  agreement or understanding pertaining to any such matter shall
                  be effective  for any purpose.  No provision of this Lease may
                  be amended or  supplemented  except by an agreement in writing
                  signed by the parties hereto or their successor in interest.


                                      -37-
<PAGE>


         (b)      ATTORNEYS' FEES; WAIVER OF JURY TRIAL.

                  (i)      In any  action to  enforce  the terms of this  Lease,
                           including  any suit by Landlord  for the  recovery of
                           rent or possession of the Premises,  the losing party
                           shall pay the  successful  party a reasonable sum for
                           attorneys' fees in such suit and such attorneys' fees
                           shall  be  deemed  to  have  accrued   prior  to  the
                           commencement of such action and shall be paid whether
                           or not such action is prosecuted to judgment.

                  (ii)     Should Landlord, without fault on Landlord's part, be
                           made a party to any  litigation  instituted by Tenant
                           or  by  any  third  party  against  Tenant,  or by or
                           against  any  person   holding  under  or  using  the
                           Premises by license of Tenant, or for the foreclosure
                           of any lieu for labor or material furnished to or for
                           Tenant or any such other person or otherwise  arising
                           out of or resulting  from any act or  transaction  of
                           Tenant or of any such other person.  Tenant covenants
                           to save and hold Landlord  harmless from any judgment
                           rendered against Landlord or the Premises or any part
                           thereof  and from all costs and  expenses,  including
                           reasonable  attorneys'  fees  incurred by Landlord in
                           connection with such litigation.

                  (iii)    When legal  services  are  rendered by an attorney at
                           law who is an  employee of a party,  attorneys'  fees
                           incurred  by that party shall be deemed to include an
                           amount  based upon the number of hours  spent by such
                           employee on such matters multiplied by an appropriate
                           billing rate determined by taking into  consideration
                           the same  factors,  including but not limited by, the
                           importance of the matter,  time  applied,  difficulty
                           and results,  as are considered  when an attorney not
                           in the employ of a party is  engaged  to render  such
                           service.

                  (iv)     EACH PARTY HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY
                           IN ANY ACTION  SEEKING  SPECIFIC  PERFORMANCE  OF ANY
                           PROVISION  OF THIS LEASE,  FOR DAMAGES FOR ANY BREACH
                           UNDER THIS LEASE,  OR OTHERWISE FOR  ENFORCEMENT  OF
                           ANY RIGHT OR REMEDY HEREUNDER

         (c)      TIME  OF  ESSENCE.  Each of  Tenant's  covenants  herein  is a
                  condition  and  time is of the  essence  with  respect  to the
                  performance of every provision of this Lease.


         (d)      HEADINGS; JOINT AND SEVERAL. The article headings contained in
                  this  Lease  are for  convenience  only  and do not in any way
                  limit or  amplify  any term or  provision  hereof.  The  terms
                  "Landlord"  and  "Tenant"  as used  herein  shall  include the
                  plural as well as the  singular,  the neuter shall include the
                  masculine  and  feminine  genders and the  obligations  herein
                  imposed  upon Tenant  shall be joint and several as to each of
                  the  persons,  firms or  corporations  of which  Tenant may be
                  composed.


                                      -38-
<PAGE>


         (e)      RESERVED AREA. Tenant hereby  acknowledges and agrees that the
                  exterior  walls  of the  Premises  and the  area  between  the
                  finished ceiling of the premises and the slab of the floor of
                  the project  thereabove  have not been demised  hereby and the
                  use thereof together with the right to install, maintain, use,
                  repair and replace  pipes,  ducts,  conduits and wires leading
                  through,  under or above the Premises in locations  which will
                  not materially interfere with Tenant's use of the Premises and
                  serving  other parts of the Project  are hereby  excepted  and
                  reserved unto Landlord.

         (f)      NO OPTION. THE SUBMISSION OF THIS LEASE BY LANDLORD, ITS AGENT
                  OR REPRESENTATIVE  FOR EXAMINATION OR EXECUTION BY TENANT DOES
                  NOT  CONSTITUTE  AN OPTION OR OFFER TO LEASE THE PREMISES UPON
                  THE TERMS AND CONDITIONS  CONTAINED HEREIN OR A RESERVATION OF
                  THE PREMISES IN FAVOR OF TENANT, IT BEING INTENDED HEREBY THAT
                  THIS LEASE  SHALL ONLY  BECOME  EFFECTIVE  UPON THE  EXECUTION
                  HEREOF BY LANDLORD AND DELIVERY OF A FULLY  EXECUTED  LEASE TO
                  TENANT.

         (g)      USE OF PROJECT NAME; IMPROVEMENTS. Tenant shall not be allowed
                  to use the name, picture or representation of the Project,  or
                  words to that effect,  in connection with any business carried
                  on in the Premises or otherwise  (except as Tenant's  address)
                  without the prior  written  consent of Landlord.  In the event
                  that Landlord  undertakes any additional  improvements  on the
                  Real Property including,  but not limited to, new construction
                  or  renovation  or  additions  to the  existing  improvements,
                  Landlord  shall not be liable to Tenant for any  noise,  dust,
                  vibration  or  interference  with  access to the  Premises  or
                  disruption in Tenant's business caused thereby.

         (h)      RULES AND  REGULATIONS.  Tenant shall observe  faithfully  and
                  comply  strictly  with the Rules and  Regulations  attached to
                  this Lease as  Exhibit  "B" and made a part  hereof,  and such
                  other Rules and  Regulations as Landlord may from time to time
                  reasonably  adopt for the safety,  care and cleanliness of the
                  Project,  the facilities  thereof, or the preservation of good
                  order  therein.  Landlord  shall not be  liable to Tenant  for
                  violation of any such Rules and Regulations, or for the breach
                  of any  covenant or condition in any lease by any other tenant
                  in the Project. A waiver by Landlord of any Rule or Regulation
                  for any  other  tenant  shall not  constitute  nor be deemed a
                  waiver of the Rule or Regulation for this Tenant.

         (i)      QUIET  POSSESSION.   Upon  Tenant's  paying  the  Basic  Rent,
                  Additional   Rent  and  other  sums  provided   hereunder  and
                  observing and performing all of the covenants,  conditions and
                  provisions  on  Tenant's  part to be  observed  and  performed
                  hereunder,  Tenant shall have quiet possession of the Premises
                  for the entire Term hereof,  subject to all of the  provisions
                  of this Lease.

         (j)      RENT.  All payments  required to be made hereunder to Landlord
                  shall be deemed to be rent, whether or not described as such.


                                      -39-
<PAGE>


         (k)      SUCCESSORS  AND ASSIGNS.  Subject to the provisions of Article
                  15 hereof, all of the covenants,  conditions and provisions of
                  this  Lease  shall  be  binding  upon and  shall  inure to the
                  benefit  of the  parties  hereto and their  respective  heirs,
                  personal representatives, successors and assigns.

         (l)      NOTICES.   Any  notice  required  or  permitted  to  be  given
                  hereunder  shall be in  writing  and may be given by  personal
                  service evidenced by a signed receipt or sent by registered or
                  certified mail, return receipt requested,  addressed to Tenant
                  at the Premises or to Landlord at:

                  c/o Kor Realty Group, L.L.C.
                  1212 S. Flower Street, Suite 400
                  Los Angeles, California 90015
                  Attention: Frank Iaffaldano

         or at the address from time to time established for the payment of rent
and which shall be effective upon proof of delivery.  Either party may by notice
to the other specify a different  address for notice  purposes except that, upon
Tenant's  taking  possession  of the  Premises,  the Premises  shall  constitute
Tenant's  address  for  notice  purposes.  A copy of all  notices to be given to
Landlord  hereunder  shall be  concurrently  transmitted by Tenant to such party
hereafter  designated  by notice from  Landlord to Tenant.  Any notices  sent by
Landlord  regarding  or  relating  to  eviction  procedures,  including  without
limitation three-day notices, may be sent by regular mail. Until further written
notice from Landlord, Landlord's address for remittance of rent shall be:

                  c/o Kor Realty Group, L.L.C.
                  1212 S. Flower Street, Suite 400
                  Los Angeles, California 90015
                  Attention: Accounting - 1212 S. Flower Street


         (m)      PERSISTENT  DELINQUENCIES.  In the event that Tenant  shall be
                  delinquent by more than  fifteen  (15) days in the  payment of
                  rent on three (3) separate  occasions in any twelve (12) month
                  period,  Landlord shall have the right to terminate this Lease
                  by thirty  (30) days'  written  notice  given by  Landlord  to
                  Tenant within thirty (30) days of the last such delinquency.

         (n)      RIGHT OF LANDLORD TO PERFORM.  All covenants and agreements to
                  be  performed  by Tenant  under any of the terms of this Lease
                  shall be performed by Tenant at Tenant's sole cost and expense
                  and without any abatement of rent. If Tenant shall fail to pay
                  any sum of money,  other than rent,  required to be paid by it
                  hereunder  or shall fail to perform  any other act on its part
                  to be performed  hereunder,  and such failure  shall  continue
                  beyond any  applicable  cure  period set forth in this  Lease,
                  Landlord may, but shall not be obligated to,  without  waiving
                  or releasing  Tenant from any obligations of Tenant,  make any
                  such payment or perform any such other act on Tenant's part to
                  be made or performed as is in this Lease provided. All sums so
                  paid by Landlord and all


                                      -40-
<PAGE>


                  reasonable incidental costs, together with interest thereon at
                  the rate of ten percent  (10%) per annum from the date of such
                  payment by  Landlord,  shall be payable to  Landlord on demand
                  and Tenant  covenants to pay any such sums, and Landlord shall
                  have (in  addition to any other  right or remedy of  Landlord)
                  the same rights and  remedies  in the event of the  nonpayment
                  thereof  by Tenant as in the case of  default by Tenant in the
                  payment of the rent.

         (o)      ACCESS, CHANGES IN PROJECT, FACILITIES, NAME.

                  (i)      Every part of the Project except the inside  surfaces
                           of all walls, windows and doors bounding the Premises
                           (including  exterior  building  walls,  core corridor
                           walls and doors and any core corridor entrance),  and
                           any space in or  adjacent  to the  Premises  used for
                           shafts,  stacks, pipes,  conduits,  fan rooms, ducts,
                           electric or other utilities,  sinks or other building
                           facilities,  and the use  thereof,  as well as access
                           thereto  through  the  Premises  for the  purposes of
                           operation,  maintenance,  decoration and repair,  are
                           reserved to Landlord.

                  (ii)     Tenant  shall  permit  Landlord to  install,  use and
                           maintain pipes,  ducts and conduits within the walls,
                           columns and ceilings of the Premises.

                  (iii)    Landlord  reserves the right,  without  incurring any
                           liability to Tenant therefor, to make such changes in
                           or to the  Project  and the  fixtures  and  equipment
                           thereof,  as well as in or to the  street  entrances,
                           halls,  passages,  elevators,   stairways  and  other
                           improvements  thereof,  as it may deem  necessary  or
                           desirable.

                  (iv)     Landlord  may  adopt  any  name for the  Project  and
                           Landlord  reserves  the right to  change  the name or
                           address of the Project at any time.

         (p)      SIGNING AUTHORITY. If Tenant is a corporation,  partnership or
                  limited  liability  company,  each  individual  executing this
                  Lease on behalf of said entity represents and warrants that he
                  or she is duly authorized to execute and deliver this Lease on
                  behalf of said entity in accordance  with:  (i) if Tenant is a
                  corporation,  a  duly  adopted  resolution  of  the  Board  of
                  Directors  of  said  corporation  or in  accordance  with  the
                  by-laws of said corporation,  (ii) if Tenant is a partnership,
                  the terms of the partnership agreement, and (iii) if Tenant is
                  a  limited  liability  company,  the  terms  of its  operating
                  agreement,  and that this Lease is binding upon said entity in
                  accordance   with  its  terms.   Concurrently   with  Tenant's
                  execution of this Lease,  Tenant  shall  provide to Landlord a
                  copy of: (i) of Tenant is a  corporation,  such  resolution of
                  the Board of Directors authorizing the execution of this Lease
                  on behalf of such corporation,  which copy of resolution shall
                  be duly  certified by the secretary or an assistant  secretary
                  of the  corporation and shall be in the form of Exhibit "E" or
                  in some other form reasonably acceptable to Landlord,  (ii) if
                  Tenant  is a  partnership,  a copy  of the  provisions  of the
                  partnership agreement granting the requisite authority to each
                  individual executing this Lease on behalf of said


                                      -41-
<PAGE>


                  partnership,  and  (iii)  if  Tenant  is a  limited  liability
                  company,  a copy of the provisions of its operating  agreement
                  granting the requisite authority to each individual  executing
                  this Lease on behalf of said limited liability company. In the
                  event Tenant fails to comply with the  requirements  set forth
                  in this subparagraph (p), then each individual  executing this
                  Lease  shall  be   personally   liable  for  all  of  Tenant's
                  obligations in this Lease. (

         q)       IDENTIFICATION OF TENANT.

                  (i)      If Tenant constitutes more than one person or entity,
                           (A)  each of them  shall  be  jointly  and  severally
                           liable for the keeping,  observing and  performing of
                           all  of  the   terms,   covenants,   conditions   and
                           provisions  of this  Lease to be kept,  observed  and
                           performed by Tenant, (B) the term "Tenant" as used in
                           this  Lease  shall  mean  and  include  each  of them
                           jointly and  severally,  and (C) the act of or notice
                           from,  or notice or refund to, or the  signature  of,
                           any one or more of them,  with respect to the tenancy
                           of this  Lease,  including,  but not  limited to, any
                           renewal,   extension,   expiration,   termination  or
                           modification,  of this Lease,  shall be binding  upon
                           each and all of the  persons  or  entities  executing
                           this  Lease as Tenant  with the same force and effect
                           as if each  and all of them  had so acted or so given
                           or received such notice or refund or so signed.

                  (ii)     If Tenant is a partnership (or is comprised of two or
                           more persons,  individually  and as  co-partners of a
                           partnership)  or if  Tenant's  interest in this Lease
                           shall be assigned to a partnership (or to two or more
                           persons,   individually   and  as  co-partners  of  a
                           partnership)  pursuant to Article 15 hereof (any such
                           partnership and such persons hereinafter  referred to
                           in this Article  31(q)(ii) as "PARTNERSHIP  TENANT"),
                           the following provisions of this Lease shall apply to
                           such Partnership Tenant:

                           (A)      The   liability   of  each  of  the  parties
                                    comprising Partnership Tenant shall be joint
                                    and several.

                           (B)      Each of the parties  comprising  Partnership
                                    Tenant  hereby  consents  in advance to, and
                                    agrees   to  be  bound   by,   any   written
                                    instrument  which may hereafter be executed,
                                    changing,   modifying  or  discharging  this
                                    Lease,  in whole or in part, or surrendering
                                    all  or any  part  of  the  Premises  to the
                                    Landlord, and by notices,  demands, requests
                                    or other  communication  which may hereafter
                                    be given,  by the  individual or individuals
                                    authorized  to execute  this Lease on behalf
                                    of Partnership Tenant under Subparagraph (p)
                                    above.

                           (C)      Any  bills,  statements,  notices,  demands,
                                    requests  or other  communications  given or
                                    rendered to Partnership  Tenant or to any of
                                    the parties  comprising  Partnership  Tenant
                                    shall  be  deemed   given  or   rendered  to
                                    Partnership  Tenant and to all such  parties
                                    and shall be binding upon Partnership Tenant
                                    and all such parties.


-42-
<PAGE>


                           (D)      If  Partnership  Tenant admits new partners,
                                    all of such  new  partners  shall,  by their
                                    admission to Partnership  Tenant,  be deemed
                                    to have  assumed  performance  of all of the
                                    terms,  covenants  and  conditions  of  this
                                    Lease on Tenant's  part to be  observed  and
                                    performed.

                           (E)      Partnership  Tenant shall give prompt notice
                                    to Landlord of the admission of any such new
                                    partners,  and,  upon  demand  of  Landlord,
                                    shall cause each such new partner to execute
                                    and deliver to Landlord an agreement in form
                                    satisfactory to Landlord,  wherein each such
                                    new partner shall assume  performance of all
                                    of the terms,  covenants  and  conditions of
                                    this Lease on  Partnership  Tenant's part to
                                    be  observed  and  performed   (but  neither
                                    Landlord's   failure  to  request  any  such
                                    agreement  nor the  failure  of any such new
                                    partner  to  execute  or  deliver  any  such
                                    agreement to Landlord  shall  terminate  the
                                    provisions  of  clause  (D) of this  Article
                                    31(q)(ii) or relieve any such new partner of
                                    its obligations thereunder).

         (r)      SUBSTITUTE PREMISES. Landlord shall have the right at any time
                  during the Term hereof, upon giving Tenant not less than sixty
                  (60) days' prior  notice,  to provide and furnish  Tenant with
                  space elsewhere in the Project of approximately  the same size
                  as the  Premises  and remove and place  Tenant in such  space,
                  with  Landlord to pay all  verified  and  previously  approved
                  costs and  expenses  incurred as a result of such  movement to
                  such new space.  If Landlord  moves  Tenant to such new space,
                  this  Lease  and  each  and all of its  terms,  covenants  and
                  conditions  shall remain in full force and effect and shall be
                  deemed  applicable  to such new space and such new space shall
                  thereafter be deemed to be the  "Premises" as though  Landlord
                  and Tenant had entered  into an express  written  amendment of
                  this Lease with respect thereto.

         (s)      SURVIVAL OF OBLIGATIONS.  Any obligations of Tenant  occurring
                  prior to the  expiration or earlier  termination of this Lease
                  shall survive such expiration or earlier termination.

         (t)      CONFIDENTIALITY.  Tenant acknowledges that the content of this
                  Lease and any related documents are confidential  information.
                  Tenant  shall  keep  such  confidential  information  strictly
                  confidential   and  shall  not  disclose   such   confidential
                  information  to any  person  or  entity  other  than  Tenant's
                  financial,  legal  and  space  planning  consultants  and  any
                  proposed subtenants or assignees.

         (u)      GOVERNING  LAW.  This Lease shall be governed by and construed
                  in  accordance  with the laws of the State of  California.  No
                  conflicts  of law  rules of any state or  country  (including,
                  without limitation,  California  conflicts of law rules) shall
                  be applied to result in the  application of any substantive or
                  procedural laws of any state or country other than California.
                  All controversies, claims, actions or causes of action arising
                  between the parties hereto and/or their respective  successors
                  and  assigns,  shall  brought,  heard and  adjudicated  by the
                  courts of the State of California, with venue in the


                                      -43-
<PAGE>


                  County  of Los  Angeles.  Each of the  parties  hereto  hereby
                  consents to personal  jurisdiction  by the courts of the State
                  of California in connection with any such controversy,  claim,
                  action  or cause of  action,  and each of the  parties  hereto
                  consents  to service of  process  by any means  authorized  by
                  California law and consent to the  enforcement of any judgment
                  so  obtained in the courts of the State of  California  on the
                  same  terms  and  conditions  as if such  controversy,  claim,
                  action  or  cause of  action  had been  originally  heard  and
                  adjudicated  to a final  judgment in such courts.  Each of the
                  parties hereto further  acknowledges  that the laws and courts
                  of  California  were freely and  voluntarily  chosen to govern
                  this Lease and to adjudicate any claims or disputes hereunder.

         (v)      PROPERTY  MANAGER.  Any services which Landlord is required to
                  furnish  pursuant  to the  provisions  of this Lease  may,  at
                  Landlord's option, be furnished from time to time, in whole or
                  in part,  by  employees  of  Landlord  or by one or more third
                  persons  hired by Landlord  or the  Property  Manager.  Tenant
                  agrees that upon Landlord's written request it will enter into
                  direct  agreements with the Property  Manager or other parties
                  designated by Landlord for the furnishing of any such services
                  required to be  furnished by Landlord  hereunder,  in form and
                  content  approved by Landlord,  provided  however that no such
                  contract shall result in Tenant having to pay in the aggregate
                  more money on account of its  occupancy of the Premises  under
                  the terms of this  Lease  (i.e.,  any costs  directly  paid by
                  Tenant to  Property  Manager  shall not be  included in Direct
                  Costs  and  the  total  amounts  paid  by  Tenant  under  this
                  paragraph plus Tenant's share of Direct Costs shall not exceed
                  what Tenant would have  otherwise  paid in Direct Costs should
                  Landlord have been the contracting  party rather than Tenant),
                  and  provided  further that no such  contract  shall result in
                  Tenant  receiving less services than it is presently  entitled
                  to receive under this Lease, or services of a lesser quality.

         (w)      REPRESENTATIONS NOT PERSONAL.  It is expressly  understood and
                  agreed by and between the parties  hereto,  anything herein to
                  the  contrary  notwithstanding,  that  each  and  all  of  the
                  representations,   warranties,   covenants,  undertakings  and
                  agreements  herein made on the part of any  Landlord  while in
                  form  purporting  to  be  the   representations,   warranties,
                  covenants,  undertakings  and  agreements of such Landlord are
                  nevertheless each and every one of them made and intended, not
                  as   personal    representations,    warranties,    covenants,
                  undertakings  and  agreements  by  such  Landlord,  or for the
                  purpose  or  with  the  intention  of  binding  such  Landlord
                  personally,  but are made and intended for the purpose only of
                  subjecting  such  Landlord's  interest in the Premises and the
                  Project  to the terms of this  Lease and for no other  purpose
                  whatsoever,  and in case of default hereunder by such Landlord
                  (or default through,  under or by any of the  representatives,
                  servants,  employees  or  representatives  of such  Landlord),
                  Tenant shall look solely to the  interests of such Landlord in
                  the Premises and the Project;  that no Landlord shall have any
                  personal liability to pay any indebtedness  accruing hereunder
                  or to perform any covenant,  either express or implied, herein
                  contained;    that   no   personal   liability   or   personal
                  responsibility  of any sort is  assumed  by,  nor shall at any
                  time  be  asserted  or  enforceable  against,   Landlord,   or
                  Landlord's Property


                                      -44-
<PAGE>


                  Manager,  employees  or  representatives,  on  account of this
                  Lease or on account of any representation, warranty, covenant,
                  undertaking or agreement of Landlord contained, either express
                  or implied.  All such  personal  liability,  if any, is hereby
                  expressly  waived and  released  by Tenant and by all  persons
                  claiming by, through or under Tenant.

         (x)      ANTI-TERRORISM  REPRESENTATION.  Neither Tenant nor any of its
                  affiliates  have  engaged  in any  dealings  or  transactions,
                  directly  or  indirectly,  (i) in  contravention  of any U.S.,
                  international  or  other  money   laundering   regulations  or
                  conventions,  including, without limitation, the United States
                  Bank Secrecy Act, the United States Money  Laundering  Control
                  Act of 1986, the United States  International Money Laundering
                  Abatement and  Anti-Terrorist  Financing Act of 2001,  Trading
                  with the Enemy Act (50 U.S.C.  ss.1 et seq.,  as amended),  or
                  any foreign  asset  control  regulations  of the United States
                  Treasury  Department  (31  CFR,  Subtitle  B,  Chapter  V,  as
                  amended)  or  any  enabling  legislation  or  executive  order
                  relating thereto,  or (ii) in contravention of Executive Order
                  No.  13,244,66 Fed. Reg. 49,079 (2001) issued by the President
                  of the United States  (Executive  Order Blocking  Property and
                  Prohibiting  Transactions with Persons Who Commit, Threaten to
                  Commit,   or  Support   Terrorism),   as  may  be  amended  or
                  supplemented from time to time ("Anti-Terrorism  Order") or on
                  behalf of  terrorists  or terrorist  organizations,  including
                  those  persons or entities  that are  included on any relevant
                  lists maintained by the United Nations,  North Atlantic Treaty
                  Organization,   Organization   of  Economic   Cooperation  and
                  Development,  Financial  Action  Task  Force,  U.S.  Office of
                  Foreign Assets Control, U.S. Securities & Exchange Commission,
                  U.S.   Federal   Bureau   of   Investigation,   U.S.   Central
                  Intelligence  Agency,  U.S.  Internal Revenue Service,  or any
                  country or  organization,  all as may be amended  from time to
                  time.  Neither  Tenant nor any of its  affiliates are a person
                  described in section 1 of the Anti-Terrorism Order and neither
                  Tenant nor any of its affiliates  have engaged in any dealings
                  or  transactions,  or otherwise been  associated with any such
                  person. If at any time this representation  becomes false then
                  it shall be considered a default under this Lease and Landlord
                  shall have the right to exercise all of the remedies set forth
                  in this Lease in the event of a default.

         (y)      SIGNAGE.  Subject to the provisions of this paragraph,  Tenant
                  shall be  entitled  to  twelve  (12)  lines  on the  Project's
                  building directory and Project-standard  suite signage outside
                  the Premises,  subject to Project standard. In addition to the
                  foregoing,  in the  event  that  the  Premises  are  hereafter
                  increased so that Tenant is leasing  more square  footage than
                  any other tenant in the  Project,  Tenant shall have the right
                  to "building-top" identity signage ("BUILDING SIGNAGE") on top
                  of the  Project,  subject to any rights of any third  party to
                  Building  Signage that are existing at the time Tenant becomes
                  entitled to the Building  Signage.  The Building Signage shall
                  (A) comply with all  governmental  laws,  regulations,  rules,
                  codes and ordinances  pertaining thereto,  (B) comply with all
                  provisions of this Lease, (C) have received the prior approval
                  of all appropriate  governmental  bodies,  including  required
                  permits,  (D) have  received  the prior  written  approval  of
                  Landlord as to all aspects of the Building Signage, including,
                  without


                                      -45-
<PAGE>


                  limitation,  design and location  thereof,  and (E) conform to
                  Landlord's  signage  criteria for the  Project.  All costs and
                  expenses relating to the Building  Signage,  including without
                  limitation,  (i) the cost of the  installation of the Building
                  Signage,  (ii) the costs of obtaining  permits and  approvals,
                  (iii) the costs for the maintenance, repair and replacement of
                  the Building Signage, (iv) the cost for the maintenance of the
                  Building   Signage   and  any   electrical   consumption   for
                  illuminating the Building  Signage,  if any, and (v) the costs
                  associated  with the removal of the  Building  Signage and the
                  restoration   of  the  area  required  due  to  such  removal,
                  including,  but not  limited  to,  costs  associated  with the
                  restoration of landscaping  damaged by removal of the Building
                  Signage,  to the condition  existing prior to the installation
                  of the Building Signage, shall be at the sole cost and expense
                  of Tenant.  Tenant shall pay to Landlord,  upon written demand
                  any and all such  costs  within  ten (10) days  after  receipt
                  (except  for such  costs  payable  directly  by  Tenant to any
                  governmental  entity).  In the event of an Event of Default or
                  the expiration or earlier termination of this Lease,  Landlord
                  may elect to repair, maintain, replace and remove the Building
                  Signage at Tenant's  cost.  The Building  Signage shall at all
                  times  during  the  term  hereof  be  maintained  in  working,
                  first-class  condition.  The  signage  rights  granted in this
                  paragraph are personal to Tenant and may not be transferred by
                  Tenant. If Tenant shall assign this Lease, sublet the Premises
                  or otherwise  Transfer any interest of Tenant in this Lease or
                  the  Premises  or attempt to  transfer  any  signage  right in
                  violation of this Lease,  then the rights granted Tenant under
                  this  paragraph  shall  terminate and Landlord  shall have the
                  right to immediately  remove the Building and restore the area
                  as hereinabove  provided.  Tenant acknowledges and agrees that
                  it has familiarized  itself with the signage that Landlord has
                  currently installed on the facades of the buildings within the
                  Project.  Landlord  shall  have the  ongoing  right to install
                  similar signage on the Project building facades.

         (z)      CROSS DEFAULT.  Landlord and Tenant acknowledge and agree that
                  the   concurrent   delivery   by  Tenant  to   Landlord  of  a
                  fully-executed AIR Commercial Real Estate Association Standard
                  Industrial/Commercial Multi-Tenant Lease - Gross for the lease
                  of  premises  at 1226  South  Flower  Street  by  Tenant  (the
                  "CONCURRENT   AGREEMENT")  is  a  material  consideration  for
                  Landlord's execution of this Lease and that Landlord would not
                  execute  and  deliver  this  Lease  but  for  such  Concurrent
                  Agreement.  Accordingly,  concurrently  with the execution and
                  delivery  of this Lease by  Tenant,  Tenant  shall  deliver to
                  Landlord the duly  executed  Concurrent  Agreement.  If Tenant
                  fails to deliver to Landlord the executed Concurrent Agreement
                  concurrently  with the  delivery of this Lease,  Landlord  may
                  terminate  this Lease by written notice to Tenant given at any
                  time  thereafter.  In such event,  this Lease shall  terminate
                  upon Tenant's receipt of Landlord's notice,  Tenant shall bear
                  both parties'  expenses and fees incurred in the  negotiations
                  and preparation of this Lease and the Concurrent Agreement and
                  in  complying   herewith   through  the  date  of  termination
                  (including,  without  limitation,  Landlord's  legal fees) and
                  Landlord  shall  have no further  obligation  to Tenant or any
                  related  party  under  this  Lease  or  under  the  Concurrent
                  Agreement shall be deemed a default of


                                      -46-
<PAGE>


                  Tenant  under  this  Lease and any breach or default of Tenant
                  under  this  Lease  shall be deemed a default  of  Tenant,  as
                  lessee, under the Concurrent Agreement.

         (aa)     EXHIBITS  AND  ADDENDUM.   The  Exhibits  and   Addendum,   if
                  applicable,  attached hereto are  incorporated  herein by this
                  reference as if fully set forth herein.


                                      -47-
<PAGE>


IN WITNESS  WHEREOF,  the parties have  executed  this Lease,  consisting of the
foregoing provisions and Articles,  including all exhibits and other attachments
referenced therein, as of the date first above written.

                                  "LANDLORD"

                                  1212 FLOWER REAL ESTATE, LLC,
                                  a Delaware limited liability company

                                  By: Petit Real Estate Limited Partnership,
                                      a Delaware limited partnership,
                                      its sole member


                                      By: Kor Trio, LLC
                                          a Delaware limited liability
                                          company, its general partner


                                          By: ________________________
                                              ________________________
                                              [Printed Name and Title]


                                  "TENANT"

                                  PEOPLE'S LIBERATION, INC., a California
                                  corporation

                                  By: ____________________________________
                                      ____________________________________
                                      [Printed Name and Title]

                                  By: ____________________________________
                                      ____________________________________
                                      [Printed Name and Title]


                                      -48-
<PAGE>


                                   EXHIBIT A

                                    PREMISES

                      [demonstrated by red cross-hatching]

                               [GRAPHIC OMITTED]


                                      A-1
<PAGE>


                                   EXHIBIT B

                             RULES AND REGULATIONS

         1.       No sign,  advertisement or notice shall be displayed,  printed
                  or affixed on or to the  Premises  or to the outside or inside
                  of  the  Project  or  so as to be  visible  from  outside  the
                  Premises or Project without  Landlord's prior written consent.
                  Landlord shall have the right to remove any non-approved sign,
                  advertisement or notice,  without notice to and at the expense
                  of Tenant,  and  Landlord  shall not be liable in damages  for
                  such  removal.  All  approved  signs or lettering on doors and
                  walls shall be printed,  painted,  affixed or inscribed at the
                  expense  of  Tenant by  Landlord  or by a person  selected  by
                  Landlord and in a manner and style acceptable to Landlord.

         2.       Tenant shall not obtain for use on the Premises  ice,  waxing,
                  cleaning, interior glass polishing,  rubbish removal, towel or
                  other similar services, or accept barbering or bootblackening,
                  or coffee  cart  services,  milk,  soft  drinks or other  like
                  services on the  Premises,  except from persons  authorized by
                  Landlord  and at the  hours  and  under  regulations  fixed by
                  Landlord.  No vending  machines or machines of any description
                  shall be  installed,  maintained or operated upon the Premises
                  without  Landlord's prior written consent,  which shall not be
                  unreasonably delayed, conditioned or withheld.

         3.       The sidewalks,  halls, passages,  exits, entrances,  elevators
                  and  stairways  shall not be  obstructed by Tenant or used for
                  any purpose  other than for  ingress and egress from  Tenant's
                  Premises.  Under no circumstances is trash to be stored in the
                  corridors.  Notice  must be given to  Landlord  for any  large
                  deliveries.  Furniture,  freight  and  other  large  or  heavy
                  articles,  and all other  deliveries  may be brought  into the
                  Project  only  at  times  and  in  the  manner  designated  by
                  Landlord, and always at Tenant's sole responsibility and risk.
                  Landlord  may  impose  reasonable  charges  for use of freight
                  elevators after or before normal  business  hours.  All damage
                  done to the Project by moving or maintaining  such  furniture,
                  freight or articles  shall be repaired by Landlord at Tenant's
                  expense. Tenant shall not take or permit to be taken in or out
                  of entrances or passenger  elevators of the Project,  any item
                  normally  taken,  or  which  Landlord   otherwise   reasonably
                  requires to be taken,  in or out through  service  doors or on
                  freight elevators.  Tenant shall move all supplies,  furniture
                  and  equipment as soon as received  directly to the  Premises,
                  and shall move all waste that is at any time being  taken from
                  the Premises directly to the areas designated for disposal.

         4.       Toilet rooms, toilets, urinals, wash bowls and other apparatus
                  shall not be used for any  purpose  other  than for which they
                  were  constructed  and  no  foreign   substance  of  any  kind
                  whatsoever shall be thrown therein.

         5.       Tenant  shall not  overload the floor of the Premises or mark,
                  drive nails,  screw or drill into the partitions,  ceilings or
                  floor or in any way  deface  the  Premises.  Tenant  shall not
                  place typed,  handwritten or computer  generated  signs in the
                  B-1


                                      B-1
<PAGE>


                  corridors  or any other common  areas.  Should there be a need
                  for signage additional to the Project standard tenant placard,
                  a written request shall be made to Landlord to obtain approval
                  prior to any installation. All costs for said signage shall be
                  Tenant's responsibility.

         6.       In no event  shall  Tenant  place a load upon any floor of the
                  Premises or portion of any such  flooring  exceeding the floor
                  load per square  foot of area for which such floor is designed
                  to carry and which is  allowed  by law,  or any  machinery  or
                  equipment  which  shall  cause  excessive   vibration  to  the
                  Premises  or  noticeable  vibration  to any other  part of the
                  Project.  Prior to bringing  any heavy  safes,  vaults,  large
                  computers  or  similarly  heavy  equipment  into the  Project,
                  Tenant shall inform  Landlord in writing of the dimensions and
                  weights thereof and shall obtain  Landlord's  consent thereto.
                  Such consent shall not constitute a representation or warranty
                  by Landlord that the safe, vault or other equipment  complies,
                  with regard to distribution of weight and/or  vibration,  with
                  the  provisions  of  this  Rule  6  nor  relieve  Tenant  from
                  responsibility for the consequences of such noncompliance, and
                  any  such  safe,  vault  or  other  equipment  which  Landlord
                  determines  to constitute a danger of damage to the Project or
                  a nuisance to other  tenants,  either alone or in  combination
                  with other heavy and/or vibrating objects and equipment, shall
                  be  promptly  removed  by  Tenant,   at  Tenant's  cost,  upon
                  Landlord's written notice of such determination and demand for
                  removal thereof.

         7.       Tenant  shall not use or keep in the  Premises  or Project any
                  kerosene,  gasoline or  inflammable,  explosive or combustible
                  fluid  or   material,   or  use  any   method  of  heating  or
                  air-conditioning other than that supplied by Landlord.

         8.       Tenant shall not lay linoleum,  tile,  carpet or other similar
                  floor  covering so that the same shall be affixed to the floor
                  of the Premises in any manner except as approved by Landlord.

         9.       Tenant shall not install or use any blinds, shades, awnings or
                  screens in connection  with any window or door of the Premises
                  and  shall not use any drape or  window  covering  facing  any
                  exterior glass surface other than the standard drapes,  blinds
                  or other window covering established by Landlord.

         10.      Tenant shall  cooperate  with  Landlord in  obtaining  maximum
                  effectiveness   of  the  cooling   system  by  closing  window
                  coverings  when the sun's rays fall directly on windows of the
                  Premises.  Tenant  shall not  obstruct,  alter,  or in any way
                  impair  the  efficient   operation  of   Landlord's   heating,
                  ventilating  and  air-conditioning  system.  Tenant  shall not
                  tamper  with or  change  the  setting  of any  thermostats  or
                  control valves.

         11.      The Premises  shall not be used for  manufacturing  or for the
                  storage  of   merchandise   except  as  such  storage  may  be
                  incidental to the permitted use of the Premises.  Tenant shall
                  not,  without  Landlord's  prior  written  consent,  occupy or
                  permit any portion of the  Premises to be occupied or used for
                  the manufacture or sale of liquor


                                      B-2
<PAGE>


                  or tobacco in any form, or a barber or manicure shop, or as an
                  employment  bureau. The Premises shall not be used for lodging
                  or  sleeping  or for any  improper,  objectionable  or immoral
                  purpose. No auction shall be conducted on the Premises.

         12.      Tenant shall not make,  or permit to be made,  any unseemly or
                  disturbing  noises,  or disturb or interfere with occupants of
                  Project or  neighboring  buildings or premises or those having
                  business with it by the use of any musical instrument,  radio,
                  phonographs or unusual noise, or in any other way.

         13.      No bicycles,  vehicles or animals of any kind shall be brought
                  into or kept in or about the Premises, and no cooking shall be
                  done or permitted by any tenant in the  Premises,  except that
                  the  preparation  of coffee,  tea, hot  chocolate  and similar
                  items for  tenants,  their  employees  and  visitors  shall be
                  permitted.  No tenant  shall  cause or permit  any  unusual or
                  objectionable  odors to be  produced  in or  permeate  from or
                  throughout the Premises. The foregoing notwithstanding, Tenant
                  shall  have  the  right  to  use  a  microwave   and  to  heat
                  microwavable  items  typically  heated  in an  office.  No hot
                  plates,  toasters,  toaster  ovens  or  similar  open  element
                  cooking apparatus shall be permitted in the Premises.

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

         15.      No additional  locks or bolts of any kind shall be placed upon
                  any of the  doors or  windows  by any  tenant,  nor  shall any
                  changes be made in existing  locks or the  mechanisms  thereof
                  unless  Landlord  is first  notified  thereof,  gives  written
                  approval,  and is furnished a key therefor.  Each tenant must,
                  upon the termination of his tenancy, give to Landlord all keys
                  and key cards of stores,  offices, or toilets or toilet rooms,
                  either  furnished  to, or otherwise  procured by, such tenant,
                  and in the  event of the loss of any keys so  furnished,  such
                  tenant shall pay Landlord the cost of replacing the same or of
                  changing the lock or locks opened by such lost key if Landlord
                  shall deem it necessary to make such change.  If more than two
                  keys for one lock are desired, Landlord will provide them upon
                  payment therefor by Tenant. Tenant shall not key or re-key any
                  locks. All locks shall be keyed by Landlord's locksmith only.

         16.      Landlord  shall have the right to prohibit any  advertising by
                  any tenant which, in Landlord's  opinion,  tends to impair the
                  reputation  of the  Project or its  desirability  as an office
                  building,  and upon  written  notice from  Landlord any tenant
                  shall refrain from and discontinue such advertising.

         17.      Landlord  reserves the right to control  access to the Project
                  by all persons after reasonable hours of generally  recognized
                  business days and at all hours on Sundays and legal  holidays.
                  Each tenant shall be  responsible  for all persons for whom it
                  requests  after  hours  access and shall be liable to Landlord
                  for all acts of such persons.


                                      B-3
<PAGE>


                  Landlord  shall have the right from time to time to  establish
                  reasonable   rules   pertaining  to  freight  elevator  usage,
                  including the  allocation  and  reservation  of such usage for
                  tenants'   initial  move-in  to  their  premises,   and  final
                  departure therefrom.

         18.      Any person employed by any tenant to do janitorial work shall,
                  while in the Project and outside of the  Premises,  be subject
                  to and under the  control and  direction  of the Office of the
                  Project  or its  designated  representative  such as  security
                  personnel (but not as an agent or servant of Landlord, and the
                  Tenant shall be responsible for all acts of such persons).

         19.      All doors opening on to public corridors shall be kept closed,
                  except when being used for ingress  and egress.  Tenant  shall
                  cooperate  and comply with any  reasonable  safety or security
                  programs,  including fire drills and air raid drills,  and the
                  appointment  of "fire  wardens"  developed by Landlord for the
                  Project,  or required  by law.  Before  leaving  the  Premises
                  unattended,  Tenant shall close and securely lock all doors or
                  other means of entry to the  Premises  and shut off all lights
                  and water faucets in the Premises.

         20.      The  requirements  of tenants  will be  attended  to only upon
                  application to the Office of the Project.

         21.      Canvassing,   soliciting  and  peddling  in  the  Project  are
                  prohibited  and each  tenant  shall  cooperate  to prevent the
                  same.

         22.      All office  equipment of any  electrical or mechanical  nature
                  shall  be  placed  by  tenants  in the  Premises  in  settings
                  approved  by  Landlord,  to absorb or prevent  any  vibration,
                  noise or annoyance.

         23.      No  air-conditioning  unit or other similar apparatus shall be
                  installed  or used by any  tenant  without  the prior  written
                  consent  of  Landlord.  Tenant  shall  pay  the  cost  of  all
                  electricity used for  air-conditioning in the Premises if such
                  electrical  consumption  exceeds  normal office  requirements,
                  regardless  of  whether  additional   apparatus  is  installed
                  pursuant to the preceding sentence.

         24.      There shall not be used in any space,  or in the public  halls
                  of the  Project,  either  by any  tenant or  others,  any hand
                  trucks  except  those  equipped  with  rubber  tires  and side
                  guards.

         25.      All  electrical  ceiling  fixtures  hung in  offices or spaces
                  along the perimeter of the Project must be fluorescent  and/or
                  of  a  quality,  type,  design  and  bulb  color  approved  by
                  Landlord.  Tenant  shall not  permit  the  consumption  in the
                  Premises  of more than 2 1/2 watts per net usable  square foot
                  in the Premises in respect of office lighting nor shall Tenant
                  permit  the  consumption  in the  Premises  of more than 1 1/2
                  watts per net usable  square foot of space in the  Premises in
                  respect of the power outlets therein,  at any one time. In the
                  event that such limits are exceeded,  Landlord  shall have the
                  right to


                                      B-4
<PAGE>


                  require  Tenant  to remove  lighting  fixtures  and  equipment
                  and/or  to  charge  Tenant  for  the  cost  of the  additional
                  electricity consumed.

         26.      PARKING.

                  (a)      Intentionally omitted.

                  (b)      Automobiles  must be parked entirely within the stall
                           lines on the floor.

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

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

                  (e)      Parking  is  prohibited  in  areas  not  striped  for
                           parking.

                  (f)      Parking   cards  or  any  other  device  or  form  of
                           identification supplied by Landlord (or its operator)
                           shall   remain  the  property  of  Landlord  (or  its
                           operator). Such parking identification device must be
                           displayed  as  requested  and may not be mutilated in
                           any  manner.   The  serial   number  of  the  parking
                           identification device may not be obliterated. Devices
                           are not  transferable or assignable and any device in
                           the  possession  of an  unauthorized  holder  will be
                           void.  There  will  be a  replacement  charge  to the
                           Tenant or person  designated  by Tenant of $25.00 for
                           loss of any parking  card.  There shall be a security
                           deposit of $25.00 due at  issuance  for each card key
                           issued to Tenant.

                  (g)      The monthly rate for parking is payable one (1) month
                           in advance and must be paid by the third business day
                           of each  month.  Failure to do so will  automatically
                           cancel  parking   privileges  and  a  charge  at  the
                           prevailing  daily rate will be due. No  deductions or
                           allowances  from the  monthly  rate  will be made for
                           days parker does not use the parking facilities.

                  (h)      Tenant may validate visitor parking by such method or
                           methods  as  the  Landlord   may   approve,   at  the
                           validation   rate   from   time  to  time   generally
                           applicable to visitor  parking,  not to exceed $20.00
                           per day.

                  (i)      Landlord  (and its operator) may refuse to permit any
                           person who  violates  the within rules to park in the
                           parking  facilities,  and any  violation of the rules
                           shall  subject  the  automobile  to removal  from the
                           parking facilities at the parker's expense. In either
                           of said  events,  Landlord  (or its  operator)  shall
                           refund  a pro rata  portion  of the  current  monthly
                           parking  rate and the  sticker  or any other  form of
                           identification supplied by Landlord (or its operator)
                           will be returned to Landlord (or its operator).

                  (j)      Parking  managers or attendants are not authorized to
                           make or  allow  any  exceptions  to these  Rules  and
                           Regulations.


                                      B-5
<PAGE>


                  (k)      All   responsibility   for  any  loss  or  damage  to
                           automobiles  or  any  personal  property  therein  is
                           assumed by the parker.

                  (1)      Loss or theft of parking  identification devices from
                           automobiles  must be reported  to the garage  manager
                           immediately,  and a lost  or  stolen  report  must be
                           filed by the parker at that time.

                  (m)      The parking  facilities  are for the sole  purpose of
                           parking one  automobile per space.  Washing,  waxing,
                           cleaning or  servicing  of any vehicles by the parker
                           or his agents is prohibited.

                  (n)      Landlord  (and its  operator)  reserves  the right to
                           refuse  the  issuance  of monthly  stickers  or other
                           parking  identification  devices to any Tenant and/or
                           its  employees  who  refuse to comply  with the above
                           Rules and Regulations and all City,  State or Federal
                           ordinances, laws or agreements.

                  (o)      Tenant  agrees to acquaint all  employees  with these
                           Rules and Regulations.

                  (p)      No vehicle shall be stored in the parking  facilities
                           for a period of more than one (1) week.

         27.      The  Project is a  non-smoking  Project.  Smoking or  carrying
                  lighted  cigars or  cigarettes in the Premises or the Project,
                  including the elevators in the Project, is prohibited.


                                       B-6
<PAGE>


                                   EXHIBIT C

                           NOTICE OF LEASE TERM DATES
                        AND TENANT'S PROPORTIONATE SHARE

TO: ______________________                             DATE: __________________
    ______________________
    ______________________

RE: Lease  dated  ________________,   ___,   between  __________________________
___________________________   ("Landlord"),   and   ____________________________
____________________________  ("Tenant"),  concerning  Suite ______,  located at
___________________________________________________________.

Ladies and Gentlemen:

                  In accordance with the Lease, Landlord wishes to advise and/or
confirm the following:

         1.       That the Premises have been accepted herewith by the Tenant as
                  being substantially  complete in accordance with the Lease and
                  that there is no deficiency in construction.

         2.       That the  Tenant  has taken  possession  of the  Premises  and
                  acknowledges  that under the provisions of the Lease, the Term
                  of said Lease shall commence as of ____________  for a term of
                  ________________________ ending on ________________.

         3.       That in accordance with the Lease,  Basic Rental  commenced to
                  accrue on ___________________________.

         4.       If the Commencement  Date of the Lease is other than the first
                  day of the month,  the first  billing  will contain a prorated
                  adjustment.  Each  billing  thereafter  shall  be for the full
                  amount of the  monthly  installment  as  provided  for in said
                  Lease.

         5.       Rent is due and  payable  in  advance on the first day of each
                  and  every  month  during  the Term of said  Lease.  Your rent
                  checks should be made payable to _____________________________
                  at __________________________.

         6.       The exact  number of rentable  square feet within the Premises
                  is ________ square feet.


                                      C-1
<PAGE>


         7.       Tenant's Proportionate Share, as adjusted based upon the exact
                  number  of  rentable  square  feet  within  the  Premises,  is
                  _______%.

AGREED AND ACCEPTED:
                                          TENANT:
                                          ____________________________________,

                                          a ___________________________________


                                          By: _______________________________

                                              _______________________________
                                                 [Printed Name and Title]


                                      C-2
<PAGE>


                                   EXHIBIT D

                             [INTENTIONALLY OMITTED]


                                      D-1
<PAGE>



                                    EXHIBIT E

                               SIGNING RESOLUTION

                                CERTIFIED COPY OF
                         BOARD OF DIRECTORS RESOLUTIONS
                                       OF
                      ____________________________________

                  The undersigned, being the duly elected Corporate Secretary of
___________________________   a  _______________  corporation   ("Corporation"),
hereby  certifies  that the  following  is a true,  full and correct copy of the
resolutions adopted by the Corporation by unanimous written consent in lieu of a
special meeting of its Board of Directors,  and that said  resolutions  have not
been amended or revoked as of the date hereof.

                  RESOLVED,  that  the  Corporation,  is  hereby  authorized  to
execute,  deliver and fully  perform that  certain  document  entitled  Standard
Office  Lease  ("Lease")  by and between  the  Corporation  and1212  FLOWER REAL
ESTATE,  LLC, a Delaware limited  liability  company,  for the lease of space at
1212 South Flower Street, Los Angeles 90015.


                  RESOLVED  FURTHER,  that the Corporation is hereby  authorized
and directed to make, execute and deliver any and all,  consents,  certificates,
documents,  instruments,  amendments,   confirmations,   guarantees,  papers  or
writings as may be required in connection  with or in  furtherance  of the Lease
(collectively  with the Lease, the  "Documents") or any  transactions  described
therein,  and to do any and all other acts  necessary or desirable to effectuate
the foregoing resolution.

                  RESOLVED FURTHER, that the following officers acting together:
______________  as  _____________;   and  ____________  as  _______________  are
authorized  to execute and deliver the  Documents on behalf of the  Corporation,
together with any other documents and/or instruments  evidencing or ancillary to
the  Documents,  and in such  forms and on such terms as such  officer(s)  shall
approve, the execution thereof to be conclusive evidence of such approval and to
execute and deliver on behalf of the Corporation  all other documents  necessary
to effectuate said transaction in conformance with these resolutions.


Date: _____________, 200_ _________________________________

________________, Corporate Secretary


                                      E-1