<PAGE>

                                                                  EXHIBIT 10.6

NORTH CAROLINA                                        LEASE AGREEMENT
WAKE COUNTY                                      SINGLE STORY FLEX BUILDING

THIS LEASE AGREEMENT ("Lease"),  made and entered into as of the day of the 19th
day of April, 2000, by and between

                   SOUTHPORT BUSINESS PARK LIMITED PARTNERSHIP
                     Hereinafter referred to as "Landlord,"
                                      AND:

                               HOME DIRECTOR, INC.

          a Delaware corporation, hereinafter referred to as "Tenant;"

                              STATEMENT OF PURPOSES
                              ---------------------

Landlord is the owner of  Southport,  an office,  research and  development  and
distribution park located in Wake County, North Carolina ("Property").  Landlord
and Tenant  have  agreed that  Landlord  shall lease to Tenant and Tenant  shall
lease from Landlord  certain space at 1015 Aviation  Parkway,  Suites 100 --500,
Morrisville, North Carolina and have agreed to enter into this Lease to evidence
the tern and conditions of the leasing of space by Landlord to Tenant.

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

                                   ARTICLE 1
                                BASIC PROVISIONS

SECTION 1.01 -    THE DEMISED PREMISES

Subject in all respects to the terms, conditions,  agreements and limitations of
this Lease,  the Landlord  hereby leases to Tenant and Tenant hereby leases from
Landlord the following described space,  hereinafter referred to as the "Demised
Premises":

Approximately  THIRTY-ONE  THOUSAND THREE HUNDRED EIGHT (31,308) SQUARE FEET (as
measured  from the  centerline  of all  demising  and  exterior  walls) of space
located in the  building  located at 1015  AVIATION  PARKWAY,  SUITES  100--500,
MORRISVILLE,  NORTH  CAROLINA  (such  building  in the lot or lots in  which  is
located collectively, hereinafter referred to as the "Building") in Morrisville,
Wake County,  North  Carolina.  The location of the Demised  Premises within the
Building  shall be as shown on EXHIBIT A attached  hereto and hereby made a part
hereof.  The Demised  Premises shall consist  of3l,000  rentable  square feet of
space  within  Suites  100-500,  and 308  rentable  square feet of the  Interior
Hallway (as described in EXHIBIT C allocated to Tenant.


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<PAGE>

SECTION 1.02 -    TERM OF THE LEASE

Subject in all respects to the terms,  limitations,  conditions  and  agreements
contained  herein,  the term of this Lease  (herein  referred  to as the "Term")
shall  commence on the earlier of the date that the Tenant takes  possession  of
any part of the  Demised  Premises  or JULY 1, 2000  provided  that the  Demised
Premises are "ready for occupancy" (as defined in Section 3.03 below), whichever
first  occurs,  and shall  terminate  (unless  extended as herein  provided)  at
midnight  on JUNE 30, 2005  Landlord  and Tenant each agrees to sign a statement
confirming the actual date on which the Term begins  (herein  referred to as the
"Commencement  Date")  as  soon  as it  is  determined.  If  Tenant  remains  in
possession of the Demised  Premises  after the end of the Term or any renewal or
extension  thereof with  Landlord's  consent but without a new lease  reduced to
writing and duly  executed,  Tenant shall be deemed to be occupying  the Demised
Premises as a tenant from month- to-month only, but otherwise subject to all the
covenants, conditions, and agreements of this Lease.

SECTION 1.03 -    USE OF THE DEMISED PREMISES

Subject  to  the  general   limitations  of  Section  4.01  and  to  the  terms,
limitations,  conditions and  agreements  contained  herein,  Tenant may use the
Demised  Premises  for  the  following  purposes  but  for  none  other  without
Landlord's  prior written  consent:  TENANT MAY OCCUPY THE PREMISES FOR OFFICES,
SALES,  DISPLAY,  STORAGE,  SERVICE,  REPAIR AND USE OF  TENANT'S  PRODUCTS  AND
EQUIPMENT,  ENGINEERING,  TRAINING OF TENANT'S  CUSTOMERS  AND  EMPLOYEES  FOR A
COMPUTER, OFFICE ELECTRONICS AND TELECOMMUNICATIONS COMPANY.

SECTION 1.04 -    MONTHLY MINIMUI' RENT AND ADJUSTED MONTHLY MINIMUM RENT

Rents shall be payable as follows:

         For the first twelve full months,  TWENTY SIX  THOUSAND  SEVEN  HUNDRED
FORTY-TWO  AND  25/100  DOLLARS  ($26,742.25)  (hereinafter  referred  to as the
"Monthly Minimum Rent").

         For  the  next  TWELVE  months,   TWENTY-SEVEN  THOUSAND  FIVE  HUNDRED
FORTY-FOUR  AND  52/100  DOLLARS  ($27,544.52)  (hereinafter  referred  to as an
"Adjusted Monthly Minimum Rent").

         For the next TWELVE months, TWENTY-EIGHT THOUSAND THREE HUNDRED SEVENTY
AND  86/100  DOLLARS,  ($28,370.86)  (hereinafter  referred  to as an  "Adjusted
Monthly Minimum Rent").

         For the next TWELVE months, TWENTY-NINE THOUSAND TWO HUNDRED TWENTY-ONE
AND 09/100 DOLLARS ($29,221.09) (hereinafter referred to as an "Adjusted Monthly
Minimum Rent").

         For the next TWELVE  months,  THIRTY  THOUSAND  ONE  HUNDRED  SEVEN AND
86/100 DOLLARS  ($30,107.86)  (hereinafter  referred to as an "Adjusted  Monthly
Minimum Rent").

Such Monthly Minimum Rent or the Adjusted  Monthly Minimum Rents,  together with
any Additional Rents then due as specified in Article 2 of this Lease,  shall be
payable on or before  the first day of each  calendar  month  during the Term of
this Lease.



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<PAGE>

If the Term commences on any day other than of the first day of a calendar month
then, in lieu of the Minimum Monthly Rent specified  above, the Tenant shall pay
for the initial partial month (being the period from the Commencement Date until
the end of that month) a prorated  Monthly  Minimum Rent computed based upon the
Monthly Minimum Rent specified above prorated for the number of days during such
period.

SECTION 1.05 -    SECURITY DEPOSIT

Landlord  acknowledges  receipt of the sum of SIXTY  THOUSAND  D NO/100  DOLLARS
($60,000.00)  which is the same sum  delivered to Landlord as the "Holding  Fee"
described  in  Paragraph 1 of EXHIBIT C attached  hereto.  Provided  that Tenant
satisfies the conditions set forth in EXHIBIT C and the parties proceed with the
leasing in the manner contemplated by EXHIBIT C, then Landlord shall retain such
sum as  security  for the  performance  by  Tenant  of  each of its  obligations
hereunder,  and it shall be referred to thereafter  as the  "Security  Deposit".
Such  Security  Deposit  shall be held,  applied and  refunded in the manner and
subject to the conditions hereinafter provided.

SECTION 1.06 -    RENT ABATEMENT

No  Monthly  Minimum  Rent  shall  be due for the  first  three  weeks  from the
Commencement Date (the "Abatement Period"). Tenant shall not be obligated to pay
any Additional Rent (as defined in Article 2) on the Demised Premises during the
Abatement Period.  During the Abatement Period, all terms and conditions of this
Lease,  except for payment of Monthly  Minimum Rent and Additional  Rent,  shall
apply to Tenant's use and occupancy of the Demised Premises.

                                   ARTICLE 2
                                 ADDITIONAL RENT

SECTION 2.01 - THIS SECTION HAS BEEN INTENTIONALLY DELETED.

SECTION 2.02 -    SHARE OF DIRECT EXPENSES

The Tenant agrees to pay to Landlord,  as Additional  Rent, each year,  Tenant's
proportionate  share of any Direct Expenses incurred by or accrued as an expense
of  Landlord or its agents on account of the  operation  or  maintenance  of the
Building and all  appurtenances  thereto and  including a portion of any charges
attributable to Common Areas, as hereinafter  defined,  and an allocable portion
of any and all other charges incurred by or accrued as an expense of Landlord in
connection with the operation or maintenance of the Building;  provided, however
in the cases of expenses which benefit portions of Southport Business Park other
than the  Building,  the portion  allocated to the Building  shall be based upon
sound accounting  principles adopted by the Landlord for the purpose of making a
reasonable allocation.

Attached  hereto as EXHIBIT F is the  estimated  1999  Direct  Expenses  for the
Building.

Tenant's  proportionate  share of the total of all Direct Expenses  allocable to
the  Building  shall be  calculated  by  dividing  the total  square feet of the
Demised  Premises  stated at Section  1.01 hereof by an amount which is equal to
the total net rentable  square feet of the  Building.  It is agreed that the net


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rentable  square  feet of the  Building  is FORTY FIVE  THOUSAND  EIGHT  HUNDRED
(45,880) SQUARE FEET.

Notwithstanding the foregoing, in the event the usage of any utility,  equipment
or other  Direct  Expense  by  Tenant  shall be  determined  by  Landlord  to be
disproportionate  to the amount of space leased by Tenant, the Landlord reserves
the right to make an  allocation  of such  Direct  Expense to Tenant  based upon
actual usage by Tenant, as reasonably determined by the Landlord.  Tenant agrees
to pay such specially  allocated  amount in the event Landlord  determines  such
usage is disproportionate and so advises Tenant.

The term  "Direct  Expense" as used  herein,  shall  include all direct costs of
operation  and  maintenance  as  determined  by  Generally  Accepted  Accounting
Principles (GAAP) and shall include without  limitation the following:  building
supplies;  ad valorem real and personal  property  taxes and other  governmental
charges;  utility and service  charges  attributable  to Common Areas or paid by
Landlord;  property,  casualty, liability and other insurance premiums; repairs,
reserves for major repairs,  maintenance and service contracts for the Building,
Common Areas and all related mechanical equipment;  property management charges;
grounds maintenance,  security, removal of snow and ice, parking maintenance and
striping, landscaping; and all other similar costs and expenses. ATTACHED HERETO
AS EXHIBIT C ARE ITEMS EXCLUDED FROM TENANT'S SHARE OF DIRECT EXPENSES.

If the State of North  Carolina  or any  political  subdivision  thereof  or any
governmental  or quasi-  governmental  authority  having  jurisdiction  over the
Building,  should  specifically  impose  a  tax,  assessment  charge  or  fee or
specifically  increase a then  existing  tax  assessment,  charge or fee,  which
Landlord shall be required to pay, either by way of  substituting  for said real
estate taxes or assessed against the Building, or in addition thereto, or impose
an income or  franchise  tax or tax on rents in  substitution  for a general tax
levied  against the Building or in addition  thereto,  such taxes,  assessments,
charges or fees shall be deemed to  constitute a real  property tax hereunder to
the extent said taxes are in substitution  therefore or in addition  thereto.  A
copy of THE ACTUAL tax bills or assessment bills submitted by Landlord to Tenant
shall  at all  times be  sufficient  evidence  of the  amount  of  taxes  and/or
assessments  levied or assessed against the property to which such bill relates.
Landlord's  reasonable  expenditures  for  attorney's  fees,  appraiser's  fees,
consultant's fees and other costs incurred during the Term of this Lease without
regard to the tax year  involved,  in any  efforts by  Landlord  to  minimize ad
valorem personal and real property taxes, and other governmental charges,  which
rights are  reserved to  Landlord,  shall be included  in the  definition  of ad
valorem real and personal property taxes and other governmental  charges for the
purposes of this Section.  If Landlord should receive a refund of any such taxes
or charges,  the Tenant will share  proportionately in same, after deduction for
all of Landlord's expenses in obtaining any such refund. Landlord's and Tenant's
obligations  under this Section shall survive the expiration of the Term of this
Lease.

The term  "Direct  Expense"  shall not include any income tax of  Landlord,  any
depreciation on the Building or any depreciation on equipment therein, interest,
or real estate broker's commission for any sale or for securing the execution of
any Lease.



                                       4
<PAGE>

SECTION 2.03 -    ADDITIONAL RENT - CERTAIN TAXES

Tenant  shall  further  pay as  Additional  Rent any sales or use tax imposed on
rents due from Tenant (other than City, State or Federal Income Tax), and to the
fullest  extent  lawful;  any tax or  rents in lieu of ad  valorem  taxes on the
Building,  even though laws imposing  such taxes attempt to require  Landlord to
pay the same.

SECTION 2.04 -    NOTICE

Landlord shall from time to time send to Tenant, in writing,  a statement of the
amount of any Additional Rent plus any applicable  sales or use taxes payable by
Tenant under Sections 2.02, 2.03, or 2.05 hereof.

LANDLORD  SHALL PROVIDE A STATEMENT OF  RECONCILIATION  TO TENANT PRIOR TO APRIL
FIRST OF EACH YEAR, BEGINNING IN 2001, WHICH COMPARES ACTUAL TO ESTIMATED DIRECT
EXPENSES FOR THE PRIOR CALENDAR YEAR. IN THE EVENT THAT TENANT'S SHARE OF ACTUAL
DIRECT  EXPENSES FOR SUCH YEAR EXCEED  ESTIMATED  DIRECT EXPENSES PAID BY TENANT
DURING  THAT YEAR,  THEN  TENANT  SHALL HAVE  THIRTY (30) DAYS TO EITHER PAY THE
EXCESS OR TO ASK TO AUDIT THE BACKUP  INFORMATION TO SUCH  STATEMENT.  IF TENANT
ASKS TO AUDIT SUCH BACKUP  INFORMATION,  IT SHALL BE COMPLETED WITHIN SIXTY (60)
DAYS OF THE  REQUEST  AND BE  CONDUCTED  AT  LANDLORD'S  OFFICES  DURING  NORMAL
BUSINESS HOURS.  TENANT, MAY REVIEW BACKUP INFORMATION FROM THE NEXT PRIOR YEAR,
BUT MAY NOT DISPUTE STATEMENTS FOR THAT YEAR NOT MADE IN A TIMELY MANNER.

SECTION 2.05 -    PAYMENT IN ADVANCE

Tenant shall pay to Landlord each month,  one twelfth (1/12) of the amounts,  if
any, reasonably  computed by Landlord to be Tenant's  anticipated annual charges
for  Additional  Rents,  in  anticipation  of Additional  Rents due for the then
current calendar year and all such monthly payments shall be applied to Tenant's
Additional Rent for the then current calendar year.

FOR INFORMATIONAL PURPOSES ONLY, A COPY OF THE ESTIMATED COST OF DIRECT EXPENSES
FOR THE  DEMISED  PREMISES  FOR THE 1999  CALENDAR  YEAR IS  ATTACHED  HERETO AS
EXHIBIT  F;  HOWEVER,  SUCH  SCHEDULE  IS NOT  INTENDED  TO BE, AND SHALL NOT BE
CONSTRUED BY TENANT TO BE, A LIMITATION ON THE TYPE OR LEVEL OF DIRECT  EXPENSES
FOR WHICH TENANT IS RESPONSIBLE UNDER THIS LEASE, WHICH SHALL BE GOVERNED BY THE
TERMS AND CONDITIONS OF THIS LEASE.

SECTION 2.06 -    PAYMENT OF RENTS. LATE PAYMENT. NON-PAID CHECK

All rents shall be paid at the address  from time to time  specified by Landlord
by written notice to Tenant. The covenant of Tenant to pay rents is and shall be
independent of any and all other  covenants of this Lease and all rents shall be
payable when due without prior notice or demand and without  offset or deduction
whatsoever,  in legal tender of the United  States of America for the payment of
public or private debts.

In addition to such  remedies as may be provided  under  Article 12,  Default by
Tenant  and  Landlord's  Remedies,  Landlord  shall be  entitled  to, as further
Additional Rent, a late charge of two (2%) per cent of any amount due hereunder,
if not received  within  fifteen (15) days of when due, and a charge of two (2%)
per cent of any amount  due  hereunder,  for any check  given by Tenant not paid
when first  presented to the financial  institution on which the check is drawn.


                                       5
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In  addition,  in the event the Tenant  fails to pay any  amount  due  hereunder
including, but not limited to any Monthly Minimum Rent, Adjusted Monthly Minimum
Rent,  Additional  Rents, or other monetary payment as and when provided in this
Lease  (which  shall  include a failure to pay by reason of the failure to honor
any check),  the Tenant shall pay to the Landlord as Additional  Rent,  interest
daily at the annual  rate of four (4%) per cent in excess of the prime  interest
rate from time to time in effect,  by CitiBank  N.A.,  New York,  New York.  Any
payment by Tenant or acceptance by Landlord of a lesser amount than shall be due
from  Tenant to  Landlord  shall,  be  treated  as a  payment  on  account.  The
acceptance  by Landlord of a check for a lesser  amount with an  endorsement  or
statement thereon,  or upon any letter accompanying such check, that such lesser
amount is payment in full shall be given no effect, and Landlord may accept such
check without  prejudice to any other rights or remedies which Landlord may have
against Tenant.

SECTION 2.07 -    OTHER CHARGES TO BE TREATED AS RENTS

All charges,  costs and sums required to be paid by Tenant to Landlord hereunder
shall be considered  Additional  Rent and shall be  collectible  by and with the
same rights held by the Landlord for the collection of rents.

                                   ARTICLE 3
                      IMPROVEMENTS TO THE DEMISED PREMISES

SECTION 3.01 -    TENANT'S ACCEPTANCE OF PREMISES

Tenant represents to the Landlord that it has examined and inspected the Demised
Premises and finds them to be as represented by the Landlord,  satisfactory  for
Tenant's intended use, and free from existing violations of Section 4.02. Tenant
hereby accepts the Demised  Premises "as is". Any additional  improvements to be
performed by Landlord are separately identified in EXHIBIT B.

SECTION 3.02 -    SCOPE OF LANDLORD'S WORK

Landlord  shall,  at its own expense,  perform the additional  work described as
"Landlord's Work" in EXHIBIT B attached hereto and made a part hereof.  LANDLORD
SHALL  PROVIDE  TENANT AN ALLOWANCE  UP TO, BUT NOT TO EXCEED,  $5.00 PER SQUARE
FOOT OF DEMISED PREMISES LEASED, IN ORDER TO PERFORM LANDLORD'S WORK. TENANT, AT
ITS EXPENSE, SHALL PAY ANY ADDITIONAL COST INCURRED TO COMPLETE LANDLORD'S WORK.
SUCH ADDITIONAL COSTS SHALL BE PAID BY TENANT WITHIN THIRTY (30) DAYS OF RECEIPT
OF BILL FROM LANDLORD.  It is expressly  understood  and agreed that  Landlord's
obligation with respect to construction of the Demised Premises shall be limited
to the scope of work  described as Landlord's  Work in EXHIBIT B and shall in no
event  include  any work not  described  on EXHIBIT B and shall not  include the
performance,  procurement  and/or  installation  of any other work,  fixtures or
equipment.  All Landlord's  Work shall  constitute  improvements  to the Demised
Premises and shall remain upon expiration of the Term of the Lease.



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SECTION 3.03 -    NOTICE OF COMPLETION OF LANDLORD'SWORK

Landlord  shall notify Tenant upon  completion of Landlord's  Work.  The Demised
Premises shall be deemed "ready for occupancy"  under the terms of this Lease if
the Demised Premises are "Systems Ready" (as defined in Section 13.12 below) and
if Landlord has  substantially  completed its work in accordance  with the terms
and conditions of EXHIBIT B attached hereto,  which can be accomplished prior to
and  independently of any construction or installation  required to be performed
by Tenant.  The occupancy and use of the additional  improvements  by the Tenant
shall be deemed conclusive  evidence that the Demised Premises are Systems Ready
and that  Landlord's  Work has been  substantially  completed in accordance with
EXHIBIT B.

The failure by Tenant to give notice  within thirty (30) days of the delivery of
possession  of  the  Demised  Premises  specifying  in  detail  those  items  of
Landlord's Work which are not then complete shall be deemed conclusive  evidence
that Tenant has accepted the Demised  Premises with all items of Landlord's Work
completed. Provided, however, that the foregoing sentence shall not be construed
as  limiting  Tenant's  right to make  additional  improvements  to the  Demised
Premises for a period of twelve (12) months from the  Commencement  Date, and to
be reimbursed  therefor,  subject to the terms and  conditions of Paragraph 3 of
EXHIBIT B attached hereto.

LANDLORD  SHALL  WARRANT  LANDLORD'S  WORK AND THE HVAC  SYSTEM FOR THE  DEMISED
PREMISES  (BUT NOT THE  SEPARATE  UVAC  SYSTEM FOR THE LAN ROOM) TO BE FREE FROM
DEFECTS IN MATERIALS AND WORKMANSHIP FOR ONE (1) YEAR FROM THE COMMENCEMENT DATE
OF THIS LEASE.  PROVIDED,  HOWEVER, THAT THE FOREGOING WARRANTY SHALL NOT EXTEND
TO THE LANDLORD'S  PERSONAL PROPERTY OR THE TENANT'S PERSONAL PROPERTY,  AS EACH
IS DESCRIBED ON EXHIBIT H ATTACHED  HERETO,  NOR TO ANY WORK DONE BY LANDLORD OR
THE PRIOR TENANT TO MAKE THE DEMISED PREMISES "SYSTEMS READY".

SECTION 3.04 -    LATEST COMPLETION DATE

The Landlord shall exercise  reasonable care to cause the Landlord's Work at the
Demised  Premises  to be  substantially  complete  on or  prior  to  the  Latest
Completion Date (as defined on EXHIBIT B attached  hereto).  The parties confirm
and agree that the  completion  of  Landlord's  Work may be delayed  for reasons
beyond the Landlord's control,  Force Majeure,  and hereby agree that the Latest
Completion  Date shall  automatically  be extended if and to the extent that any
delays  are  encountered  which are not  within  the  control  of the  Landlord.
Notwithstanding  the foregoing,  in the event  Landlord's  Work is not completed
within FORTY FIVE (45) days following the Latest Completion Date,  provided that
Landlord has diligently and  continuously  pursued  completion of the Landlord's
Work  during  such period and that  Tenant has not  commenced  occupancy  of the
Demised Premises,  then this Lease Agreement shall automatically become null and
void and  neither  party  hereto  shall have any further  rights or  obligations
hereunder.  Under no  circumstances  shall  Landlord be liable to Tenant for any
damages  including,  but not limited to direct,  indirect,  and consequential or
incidental damages, which may be caused by any delay in commencing or completing
its  construction  of the Demised  Premises  or for a total  failure to complete
same.



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                                   ARTICLE 4
                        USE OF THE PROPERTY BY THE TENANT

SECTION 4.01 -    USE GENERALLY

Tenant may use the Demised  Premises  for the  purposes  stated in Section  1.03
hereof, but for none other without  Landlord's prior written consent,  provided,
however,  notwithstanding  the  generality of the  foregoing,  in no event shall
Tenant make any use of the Demised  Premises,  the  Building or the Common Areas
which is in violation of any applicable  laws,  ordinances,  statutes,  rules or
regulations  affecting the Demised  Premises,  the Building or the Common Areas,
including without limitation general rules and regulations  proscribed from time
to time by Landlord  for the use of the Demised  Premises,  the  Building or the
Common Areas and  restrictions  with respect to employee  parking in  designated
employee  parking  areas as may be  developed  from time to time by Landlord and
delivered  t Tenant or posted on the  Building  insofar as they might  relate to
Tenant's use and occupancy of the Demised Premises,  nor may Tenant make any use
of  the  Demised  Premises  not  permitted  by  any  present  or  future  lawful
restrictive  covenants which apply to the Demised Premises, or which is or might
constitute  a  nuisance,  or which  increases  the  property,  casualty or other
insurance premiums (or makes any such insurance unavailable to Landlord or other
tenants) on the Building.

Tenant shall not permit its agents,  employees,  or invitees to place  excessive
loads on the parking lots and drives.

Tenant shall not permit its agents,  employees,  or invitees to place  excessive
loads on the floors of the  Buildings,  the maximum  load shall not exceed Eight
Hundred (800) pounds per square foot.

TENANT SHALL MAINTAIN AND CARE FOR ITS PERSONAL PROPERTY ON THE DEMISED PREMISES
INSURE THE SAME AND SHALL NEITHER HAVE NOR MAKE ANY CLAIM  AGAINST  LANDLORD FOR
ANY LOSS OR DAMAGE TO THE SAME.

Tenant may not allow any  animals in the  Demised  Premises  or on the  Property
EXCEPT  FOR  SEEING  EYE  DOGS.  Tenant  may not  allow  unusual  odors,  noise,
vibration,  or dust to emanate from the Demised Premises.  No cooking is allowed
in the Demised Premises other than by household type microwave. To the extent of
insurance  proceeds actually  received by Landlord,  but subject to the terms of
Section 8.06 of this Lease,  LANDLORD SHALL REMAIN LIABLE FOR ALL DIRECT DAMAGES
SUFFERED  BY TENANT  BY AN ACT OF GROSS  NEGLIGENCE  OR  WILLFUL  MISCONDUCT  BY
LANDLORD AND/OR ITS AGENTS.

SECTION 4.02 -    HAZARDOUS WASTE AND RELATED MATFERS

The Tenant  shall not permit any  violation to exist with respect to the Demised
Premises,  Building,  or Property under any federal,  state or local laws, rules
and regulations now or hereafter in effect with respect to oil, hazardous wastes
or hazardous materials, or toxic substances, or the release or disposal thereof.
Tenant shall not use all or any portion of the Demised  Premises,  Building,  or
Property  for  the  generation,  storage,  treatment,  use  of  disposal  of any
substance for which a license or permit is required by North Carolina or Federal
Laws,  without the prior  written  consent of the Landlord.  Without  limitation
express or implied upon any other  requirements of this Lease,  the Tenant shall
pay all such  sums and take all  such  actions  as may be  required  to avoid or


                                       8
<PAGE>

discharge  the  imposition  of any lien on the  Demised  Premises  Building,  or
Property under North Carolina Laws, or applicable federal law as the same may be
amended from time to time, and the Tenant shall  indemnify and save harmless the
Landlord from any arid all liens,  claims,  liabilities and expenses,  including
without  limitation  attorneys'  fees  incurred or  suffered by the  Landlord by
virtue of the provisions  thereof as applied to the Demised Premises,  Building,
or Property.

         (a)      The Tenant shall not:

                  (i)      generate  (except with the proper written  consent of
                           the  Landlord  and  in  compliance   with  all  laws,
                           ordinances,  and regulations  pertaining thereto), or
                           dispose  of  any  hazardous  material  or  oil on the
                           Demised Premises, Building or Property.

                  (ii)     store  (except  with the  prior  written  consent  of
                           Landlord and in compliance with all laws, ordinances,
                           and regulations  pertaining  thereto),  or dispose of
                           any   hazardous   material  or  oil  on  the  Demised
                           Premises, Building or Property

                  (iii)    directly or  indirectly  transport or arrange for the
                           transport  of any  hazardous  material or oil (except
                           with the prior written consent of the Landlord and in
                           compliance with all laws, ordinances, and regulations
                           pertaining   thereto);   on  the  Demised   Premises,
                           Building or Property.

         (b)      The Tenant  shall  indemnify,  defend,  and hold the  Landlord
                  harmless of and from any claim brought or  threatened  against
                  the Landlord by the Tenant,  any  guarantor or endorser of the
                  obligation of Tenant, or any governmental  agency or authority
                  or any other  person  (as well as from  attorneys'  reasonable
                  fees and expenses in  connection  therewith) on account of the
                  presence of hazardous material or oil on the Demised Premises,
                  Building or  Property,  or the failure by the Tenant to comply
                  with the terms and  provisions  hereof.  This  indemnification
                  shall survive any termination of this Lease.

Failure  of Tenant to comply  with this  Section  4.02 of the Lease  shall be an
Event of Default under this Lease.

As of the  Commencement  Date,  Landlord  represents that Landlord has not used,
generated, stored, treated, or disposed of any hazardous substance,  material or
waste,  or any oil or  toxic  substance,  in or on any  portion  of the  Demised
Premises  which  resulted  in a release or  contamination  in  violation  of any
federal,  state or local laws, rules or regulations,  nor has Landlord  received
any  written  notice from any  federal,  state or local  governmental  agency or
authority  regarding  any  such  release  or  contamination.  Further,  Landlord
represents that the generator  installed on the exterior of the Demised Premises
and the  batteries  related  to the  UPS  that  supports  the  Demised  Premises
generally  are not in violation of any  federal,  state or local laws,  rules or
regulations relating to the use, generation,  storage, treatment and disposal of
such hazardous and toxic substances.



                                       9
<PAGE>

SECTION 4.03 -    PAYMENT FOR UTILITIES FOR DEMISED PREMISES

Tenant shall pay promptly and before any  delinquency for nonpayment all charges
for  utilities  serving  the Demised  Premises,  including  without  limitation,
electricity,  gas, telephone,  and/or oil bills. In the event that any utilities
are not  separately  metered for Tenant,  Tenant  shall pay its proper  pro-rata
portion of such  utilities  in common with others using such  utilities  off the
same meter as  provided  in Section  2.02.  On  request of  Landlord  or Tenant,
Tenant's use of any particular utility shall be determined by appropriate survey
of Tenant's  equipment,  by  monitoring  of  submeters,  or other method  fairly
evaluating  Tenant's  use, and after such  determination,  Tenant's  charges for
utilities   uses   surveyed   shall  be   adjusted  in   accordance   with  such
determinations. In the event Tenant's use of any utilities on a common meter are
irregular or  disproportionate,  either Landlord or Tenant shall have the option
as to future  charges to have installed at its expense  separate  meters for the
utilities in question.

                                   ARTICLE 5
                      REPAIRS AND MAINTENANCE BY THE TENANT

SECTION 5.01 -    REPAIRS AND MAINTENANCE

Tenant shall  maintain,  repair,  or replace,  (and so deliver at the end of the
Lease)  each  and  every  part  of  the  Demised  Premises,   including  without
limitation,  all glass,  doorways and doors,  interior walls, interior ceilings,
interior floors,  plumbing,  electrical,  HYAC, and all equipment located within
the Demised  Premises,  in first class repair and  condition,  and shall make at
Tenant's  sole cost and expense  such  replacements,  restorations,  renewals or
repairs, in quality equivalent to the original work replaced, as may be required
to so  maintain  the  same,  ordinary  wear and tear  only  excepted.  Equipment
servicing  the Demised  Premises  that is located  outside the Demised  Premises
shall be  maintained  by  Tenant,  if it was  installed  by the Tenant or by the
Landlord as part of Landlord's Work (e.g.  HVAC equipment  located on the roof).
Tenant, however, shall make no exterior or structural alterations, other than as
required  pursuant to Tenant's  obligations  to make  repairs and  maintain  the
Demised  Premises,  without  Landlord's  prior  written  consent.  ANY  INTERIOR
ALTERATION BY TENANT SHALL REQUIRE LANDLORD'S WRITTEN CONSENT,  SUCH CONSENT NOT
TO BE UNREASONABLY  WITHHELD. In any case, all work performed by Tenant shall be
done in a good and workmanlike manner, and so as not to disturb or inconvenience
other Tenants in the  Building.  Tenant shall not at any time permit any work to
be performed on the Demised  Premises  except by duly  licensed  contractors  or
artisans,  each of whom must carry general public liability  insurance,  in such
amounts as are  reasonably  directed by Landlord and under which  Landlord is an
additional  insured,  certificates of which shall be furnished  Landlord.  At no
time may Tenant do any work that  results in a claim of lien  against  Landlord,
and if  requested  by  Landlord on  termination  of the Lease or vacation of the
Demised  Premises by Tenant,  Tenant shall  restore at Tenant's sole expense the
Demised  Premises to the same  condition  as existed at the  completion  of work
described  in EXHIBIT B-L and B-2  ordinary  wear and tear only  excepted.  SUCH
ELECTION WILL BE MADE BY LANDLORD AT THE TIME THAT TENANT REQUESTS PERMISSION TO
MAKE AN  ALTERATION.  LANDLORD,  HOWEVER,  MAY ELECT TO REQUIRE  TENANT TO LEAVE
ALTERATIONS PERFORMED BY TENANT.



                                       10
<PAGE>

                                   ARTICLE 6
                REPAIRS. MAINTENANCE AND SERVICES BY THE LANDLORD

SECTION 6.01 -    SERVICES TO THE DEMISED PREMISES

Landlord  shall,  subject  to  interruptions  beyond  his  control  and  to  the
scheduling  of repairs by providers of such  services,  cause to be furnished to
the Demised  Premises in common with other Tenants,  the following  connections:
water and sewer connections,  telephone line connections providing access to the
local public telephone company, normal electrical  connections,  and natural gas
connections.

SECTION 6.02 -    LANDLORD'S REPAIRS

Landlord will be responsible for keeping the foundations, water mains, sewer and
sprinkler lines, roof and structural  portions of the exterior roof and walls of
the Demised Premises in good order and repair.  Landlord shall not, however,  be
responsible  for any repairs  occasioned  by reasons of the acts of Tenant,  its
employees, agents, invitees, licensees, contractors or other agents, nor for any
repairs,  regardless of the cause therefor, to the Tenant's Personal Property or
the  Landlord's  Personal  Property,  as each is described on EXHIBIT H attached
hereto.  Tenant agrees to give Landlord  written notice of the necessity for any
repairs  required to be made by Landlord,  and Landlord  shall have a reasonable
period of time thereafter to make such repairs.

                                   ARTICLE 7
                                  COMMON AREAS

SECTION 7.01 -    DEFINITION OF COMMON AREAS

For  purpose  of this  Lease,  the term  "Common  Areas"  shall  mean all areas,
improvements,  space,  equipment  and  special  services  in or  adjacent to the
Building  provided  by  Landlord  for the  common  or joint use and  benefit  of
tenants,  customers,  and  other  invitees,  including  without  limitation  any
existing or future entrance ways, exits, roads, parking lots, walkways and other
common  spaces in the Property  from time to time  designated as Common Areas by
the Landlord.

SECTION 7.02 -    USE OF COMMON AREAS

Provided Tenant is not in default under this Lease,  Tenant shall be entitled to
use, in common with others entitled thereto,  so much of the Common Areas as may
be designated from time to time by the Landlord,  subject,  however to the terms
and  conditions  of this  Lease and to such  rules and  regulations  for the use
thereof as may be proscribed from time to time by Landlord.

SECTION 7.03 -    CHANGES AND ALTERATIONS OF COMMON AREAS

The Landlord  reserves the rights, at any time and from time to time to increase
or decrease the size of and to alter the  configuration  of the Common Areas, SO
LONG AS SUCH CHANGE WILL NOT INTERFERE WITH TENANT'S USE OF THE DEMISED PREMISES
AND SUCH CHANGES  MAINTAIN THE BUILDING AS A FIRST CLASS  BUSINESS  PARK. In the
event of any such change or  alteration,  Landlord shall not be liable to Tenant
therefore, and Tenant shall not be entitled to any compensation or diminution or
abatement of Monthly  Minimum Rent,  nor shall such  diminution or alteration of
the Common Areas be considered a constructive or actual eviction.



                                       11
<PAGE>

                                   ARTICLE 8
                             INSURANCE AND INDEMNITY

SECTION 8.01 -    INSURANCE ON THE BUILDING AN]) CERTAIN IMPROVEMENTS

During  the Term of this  Lease and any  extensions  or  renewals  thereof,  the
Landlord shall maintain  property and casualty  insurance on the Building and on
so much of the upfit and additional real and personal property  improvements and
appurtenances thereto as shall be installed by or at the expense of Landlord and
constitute the property of Landlord, but not on the Landlord's Personal Property
as described on EXHIBIT H attached hereto. Such insurance shall be maintained in
an amount,  not to exceed the replacement  cost thereof,  and shall provide fire
and extended  peril  coverage and coverage  against such further and  additional
perils,  as Landlord shall from time to time determine in its sole discretion to
be appropriate.

The amount of any  insurance  premiums  incurred  by or accrued as an expense of
Landlord in securing such coverage shall  constitute a direct expense within the
meaning of Section 2.02 hereof and the Tenant shall pay its allocable portion of
such cost as a part of the  Direct  Expenses  allocated  to Tenant in the manner
provided in Section 2.02.

SECTION 8.02 -    PUBLIC LIABILITY INSURANCE

Tenant shall, at all times during the Term hereof, at its sole cost and expense,
procure and  maintain in force and effect a policy or policies of  comprehensive
public  liability  insurance  issued by a company or companies from time to time
approved by Landlord NOT TO BE  UNREASONABLY  WITHHELD,  which companies must be
authorized to transact business in North Carolina. Such policy or policies shall
insure,  under valid and enforceable  policies against loss, damage or liability
for  injury to or death of  persons  and loss or damage  to  property  CAUSED BY
TENANT AND ITS AGENTS.  Such policies of liability insurance shall name Landlord
and its  designated  property  manager as an additional  insured and shall be in
amounts and afford  coverage  against perils all as is reasonably  required from
time to time by Landlord. Coverage shall initially be in the single limit amount
of ONE MILLION DOLLARS ($1,000,000.00).

SECTION 8.03 -    INSURANCE RATING

Tenant will not conduct, or permit to be conducted, any activity, will not place
any  equipment  or  materials  in or about the Demised  Premises,  Building,  or
Property, and will not take nor allow its employees, agents, or invitees to take
any action  which  will,  in any way,  violate  any  requirement  of  Landlord's
insurance  policies  or which  will  increase  the rate of  property,  casualty,
liability or other insurance on the Demised Premises or on the Building or their
operation, or which makes any property,  casualty,  liability or other insurance
on the Demised  Premises  or Building  unavailable  to Landlord  from  companies
acceptable to the Landlord. However, in the event the Tenant shall take any such
action then, in addition to and not in  limitation of any other rights  pursuant
to this Lease, the Landlord may require the Tenant,  upon demand,  to separately
pay or  reimburse  to Landlord the amount of any  increased  insurance  premiums
attributable  to such  action  which  are in  excess  of  those  charged  at the
Commencement Date, resulting from such activity.

SECTION 8.04 -    POLICIES OR CERTIFICATES OF INSURANCE



                                       12
<PAGE>

Tenant will furnish the Landlord  prior to the delivery of the Demised  Premises
to  Tenant,  and  thereafter  not  fewer  than  thirty  (30)  days  prior to the
expiration  date of any  expiring  policies,  certified  copies of  policies  or
certificates of insurance bearing  notations  evidencing the payment of premiums
and evidencing  the insurance  coverage  required to be carried by Tenant.  Each
policy and certificate  shall contain an endorsement or provision  requiring not
fewer  than  thirty  (30)  days  written   notice  to  Landlord   prior  to  the
cancellation,  diminution  in the perils  insured  against or  reduction  of the
amount of coverage of the particular policy in question.

SECTION 8.05 -    INSURANCE OF TENANT'S PROPERTY

Tenant hereby acknowledges and agrees that it will secure and maintain insurance
upon its  fixtures,  trade  fixture,  personal  property  and any and all  other
property  of the Tenant or of any third  parties  which may from time to time be
stored or maintained in, on or around the Demised Premises and Building,  except
that  Tenant  shall not be  obligated  to  maintain  insurance  on the  Tenant's
Personal  Property,  as described on EXHIBIT H attached  hereto.  Such insurance
shall  be  maintained  in such  amounts  as  shall be  necessary  to  cover  the
replacement cost thereof.

All such policies  shall include a waiver of  subrogation  of any and all claims
against the  Landlord.  The Tenant hereby agrees that it will look solely to its
insurance  policies for  recovery of any loss for any such  property and further
confirms and agrees that in no event will it make any claim against the Landlord
for any  loss to any  such  property  and  that it will  indemnify  and hold the
Landlord  harmless  from and  against  any claim  arising  out of its failure to
maintain such insurance.

SECTION 8.06 -    WAIVER OF SUBROGATION

Landlord hereby releases Tenant, but only to the extent of Landlord's  insurance
coverage,  from any  liability  for loss or damage  caused by fire or any of the
extended coverage perils included in Landlord's  insurance policies covering the
Demised  Premises and Building  even if the insured peril shall be brought about
by the default, negligence or other action of the Tenant, its agents, employees;
provided,  this release  shall be in effect only with respect to an insured loss
and only so long as  Landlord's  policy  applicable to such loss shall contain a
clause to the effect that this release shall not affect the right of Landlord to
recover under such policy. Landlord does not waive and hereby reserves the right
to secure  compensation from Tenant for any uninsured loss, any amounts not paid
because of deductibles and other amounts not paid for any reason whatsoever:

Tenant hereby releases  Landlord,  but only to the extent of Tenant's  insurance
coverage,  from any  liability  for loss Or damage  caused by fire or any of the
extended  coverage perils included in Tenant's  insurance  policies covering any
property  of Tenant  stored at the Demised  Premises  and  Building  even if the
insured peril shall be brought about by the default,  negligence or other action
of the Landlord,  its agents,  employees or any of them; provided,  this release
shall be in effect  only with  respect  to an  insured  loss and only so long as
Tenant's  policy  applicable  to such loss shall  contain a clause to the effect
that this  release  shall not affect  the right of Tenant to recover  under such
policy.  Notwithstanding  anything to the contrary herein,  Tenant shall make no
claim  against  Landlord or its  insurer  for damage to or loss of the  Tenant's
Personal Property or the Landlord's  Personal Property,  as each is described in
EXHIBIT H ATTACHED HERETO, WHETHER BROUGHT ABOUT BY THE DEFAULT,  NEGLIGENCE, OR


                                       13
<PAGE>

OTHER ACT OR OMISSION OF THE  LANDLORD,  OR FOR ANY OTHER CAUSE,  AND WHETHER OR
NOT INSURED BY EITHER PARTY.

SECTION 8.07 -    INDEMNIFICATION

Tenant will  indemnify  and hold the Landlord  harmless from any and all claims,
actions,  damages,  liability  and  expense  in  connection  with  loss of life,
personal injury, or damage to property arising from or out of any occurrence in,
upon or at the Demised  Premises or out of the occupancy or use by Tenant of the
Demised  Premises or Building or any part thereof,  and occasioned  wholly or in
part by an act or omission of Tenant, its subtenants,  concessionaires,  agents,
contractors,  employees,  invitees,  or  licensees,  or any one or more of them,
including  reasonable  attorney's fees,  incurred by or accrued as an expense of
Landlord in defending any such claim or action.

Landlord will  indemnify and hold Tenant  harmless from any and all actual costs
and  expenses  incurred by Tenant in  defending  any claim or action for loss of
life, personal injury or damage to property arising out of an act or omission of
Landlord;  provided,  however, that Landlord's liability shall be limited to the
extent that  Landlord is  determined  by a final  judgment  issued by a court of
competent  jurisdiction  to be liable for such loss of life,  personal injury or
damage to  property,  and then only to the  extent of  Landlord's  proportionate
share of such  liability.  As conditions to  Landlord's  obligations  under this
Section 8.07, Tenant shall (i) within sixty (60) days of receiving notice of any
such claim against Tenant,  provide  Landlord with written notice of such claim,
together  with a copy of the  complaint;  and  (ii)  retain  counsel  reasonably
acceptable to Landlord.

SECTION 8.08 -    NOTIFICATION

Tenant  agrees to give Landlord  prompt  notice of any accidents or  occurrences
subject to the provisions of this Article 8.

                                   ARTICLE 9
                           LANDLORD'S RESERVED RIGHTS

SECTION 9.01 - ALTERATIONS AND ADDITIONS TO BUILDINGS AND SITE.  Landlord hereby
reserves  the  right at any time and from  time to time to make  alterations  or
additions  to, and build  additions on the Building and to build  adjoining  the
same,  and to  install,  maintain,  use and repair  and  replace  pipes,  ducts,
conduits and wires  leading  through the Demised  Premises in locations  serving
other parts of the Building  which will not  materially  interfere with Tenant's
use of the Demised Premises. Landlord also reserves the right to construct other
buildings or improvements  from time to time and to make alterations  thereof or
additions  thereto  and to build  additional  stories  on any such  Building  or
buildings and to build  adjoining same and to construct such parking  facilities
as may be necessary or desirable.

It is understood and agreed that the description of the Demised  Premises as set
forth in  EXHIBIT A hereof  and the  location  of the  Demised  Premises  in the
Building hereof shall be subject to such changes as m be certified by Landlord's
architect  as  necessary  for  engineering  or  architectural  purposes  for the
construction  of the  improvements  to be constructed  thereon,  so long as such
changes do not materially change the Demised Premises or adversely affect access


                                       14
<PAGE>

to the  Demised  Premises.  SUCH  CHANGE  WILL NOT ALTER THE SIZE OF THE DEMISED
PREMISES  MORE THAN TWO PERCENT (2%) AND THE  CALCULATION  OF RENTS THAT ARE DUE
BASED UPON THAT SIZE. Any such changes so certified  shall not  invalidate  this
Lease and the description and location of the Demised Premises shall be deemed I
have been expressly modified and amended herein in accordance with such changes.
All such changes shall maintain the first class status of the business park.

SECTION 9.02 - THIS SECTION HAS BEEN INTENTIONALLY DELETED.

SECTION 9.03 -    ACCESS TO DEMISED PREMISES

Landlord shall have the right,  either itself or through its authorized  agents,
to enter the Demised Premises WITH PRIOR VERBAL NOTICE at all reasonable  times,
to examine the same, to show them to prospective tenants for other spaces in the
Building or for the Demised Premises, to allow inspection by mortgagees,  and to
make such repairs,  alterations or changes as Landlord deems necessary.  In case
of  emergency,  Landlord or Landlord's  authorized  agent may access the Demised
Premises at any time without any  liability to the Tenant.  Tenant,  its agents,
employees,  invitees,  and guests, shall have the right of ingress and egress to
common  and  public  areas of the  Building,  provided  Landlord  by  reasonable
regulation may control such access for the comfort,  convenience  and protection
of all tenants in the Building.

Tenant  agrees to provide  Landlord with one (1) key to each lock in the Demised
Premises.

SECTION 9.04 -    LANDLORD'S RULES AND REGULATIONS

Landlord  reserves  the  right  to  establish  (and  change  from  time to time)
regulations it deems  appropriate for the common use and benefit of all tenants,
with which  regulations  Tenant  shall  comply.  Landlord  may sell the Building
without  affecting the  obligations of Tenant  hereunder.  NO RULE OR REGULATION
SHALL UNREASONABLY, MATERIALLY OR ADVERSELY AFFECT TENANT'S RIGHTS HEREUNDER.

SECTION 9.05 -    WINDOW TREATMENTS, SIGNS, AND EXTERIOR APPEARANCE

Tenant may not erect,  install, or display any sign,  advertising  material,  or
window  treatment on any wall or window surface of the Demised  Premises visible
from the exterior or on the Building,  without the prior written  consent of the
Landlord.  Landlord will not approve any signs,  advertising  material or window
treatments  which, in the sole discretion of the Landlord,  are detrimental to a
consistent and well maintained external appearance of the Building,  Property or
the Common Area. Landlord shall furnish, install, and maintain an individualized
Tenant identification sign, built to Landlord's specifications, on the facade of
the Building.  Owner reserves the right, at anytime, to change the name by which
the Property is designated.

SECTION 9.06 -    LANDLORD'S PERFORMANCE OF TENANT'S OBLIGATIONS

In the event the Tenant  shall  fail to  discharge  any  duties and  obligations
hereunder  imposed upon Tenant,  the Landlord shall have the right,  but not the
obligation,  to perform  such duties or  obligations  and,  in such  event,  the
Landlord and its agents shall be entitled to receive as  reimbursement  from the
Tenant, upon demand, an amount equal to One Hundred Twenty Percent (120%) of the


                                       15
<PAGE>

total of all  costs  and  expenses.  Any such  reimbursement  and  charge  shall
constitute Additional Rents hereunder.

                                   ARTICLE 10
                            FINANCING AND REFINANCING

SECTION 10.01 -   SUBORDINATION- ATTORNMENT

This Lease shall be deemed  subject and  subordinate  to any mortgage  which may
heretofore  or hereafter be executed by Landlord  covering the Building and land
upon which the  Building  is  located,  and to all  renewals,  modifications  or
extensions  thereof.  The  Landlord's  interest in this Lease may be assigned as
security for any financing now or hereafter  required by Landlord.  In the event
any  proceedings  are brought or notice given by any assignee for foreclosure of
any mortgage on the  Building or for the exercise of any rights  pursuant to any
mortgage or  assignment,  upon  demand,  Tenant  will  attorn to the  mortgagee,
assignee  or  purchaser  at a  foreclosure  sale  as the  case  may be and  will
recognize  such  assignee,  mortgagee or purchaser as Landlord,  providing  such
assignee,  mortgagee or purchaser agrees not to disturb  Tenant's  possession so
long as Tenant is not in  default  under the terms of this  Lease.  In the event
that Tenant  refuses to or does not  respond to  Landlord's  written  request to
execute any  documents  required by any  mortgagee,  assignee  or  purchaser  as
aforesaid  within ten calendar days,  Tenant shall be presumed to consent to the
contents thereof, and any such mortgagee, assignor or purchaser may conclusively
rely thereon.

SECTION 10.02 -   ESTOPPEL CERTIFICATE

Tenant will furnish to Landlord  and/or to the holder of any mortgage  from time
to time  encumbering  the Demised  Premises,  a  statement  of the status of any
matter pertaining to this Lease, including,  without limitation,  acknowledgment
that (or the  extent to  which)  the Lease is in full  force  and  effect,  that
Landlord is in compliance with its respective obligations  thereunder,  and that
Tenant has no offsets or claims against  Landlord.  Tenant agrees to execute and
deliver  within  fifteen  (15) days after  receipt  thereof;  an  instrument  of
estoppel in the form or substantially in the form annexed hereto as EXHIBIT D In
the event that Tenant refuses or does not respond to Landlord's  written request
to execute and return the  foregoing  instrument  within  twenty (20) days after
Tenant's  receipt  thereof,  the  Tenant  shall be  presumed  to  consent to the
contents  thereof,   and  any  such  mortgagee,   assignor,   or  purchaser  may
conclusively rely thereon.

SECTION 10.03 -   CERTAIN CHANGES FOR FINANCING

If Landlord seeks a loan on the Demised  Premises,  Building or Property and the
proposed mortgagee requires as a condition of making the loan that this Lease be
modified, Tenant agrees to enter into such modification agreement providing that
the same  does not  increase  the  charges  to  Tenant,  does not vary the areas
demised,  does not change  the Term of  Tenant's  Lease and does not  materially
increase or vary Tenant's obligations, duties or covenants under this Lease.

                                   ARTICLE 11
                           DESTRUCTION OR CONDEMNATION

SECTION 11.01 -   DESTRUCTION OF PREMISES



                                       16
<PAGE>

If the Demised  Premises  are totally  destroyed  by fire or other  casualty not
resulting  from the  wrongful or  negligent  act of Tenant,  either  Landlord or
Tenant may by written  notice,  given not later than  thirty (30) days after the
date of such total  destruction,  terminate this Lease, in which event rent paid
for the period beyond the date of  destruction  shall be refunded to Tenant.  If
there is not total  destruction  and  Tenant  reasonably  is  required  to close
operation  during  repairs,  rent shall abate while so closed,  but if Tenant is
able to continue  its  operations  during  repairs,  rent shall be adjusted  and
prorated in the proportion  which the area of unusable leased space bears to the
total Demised Premises,  providing that Landlord shall not in such case have any
liability for losses  claimed by Tenant.  However,  if: (i) the damages are such
that Landlord  concludes that restoration cannot be completed within one hundred
arid fifty  (150) days;  or (ii) less than ten  percent  (10%) of the Lease Term
Remains;  or (iii) in Landlord's  judgment,  the cost of restoration will exceed
the amount of one (1) years minimum rent; or (iv) insurance  carried by Landlord
is  insufficient to restore the Premises,  Landlord may at its option  terminate
this Lease. If the Demised Premises are damaged by cause due to fault or neglect
of Tenant,  its agents,  employees,  invitees,  or licensees,  there shall be no
apportionment  or abatement of rent.  Landlord  shall not be required to restore
fixtures  or  improvements  made or  owned  by  Tenant  that  were  not  part of
Landlord's Work or subsequently  constructed in the Demised Premises by Landlord
as part of the Lease  terms.  In the event of damage due to  casualty,  Landlord
shall not be obligated to restore any portion of the Tenant's  Personal Property
or the Landlord's Personal Property,  as each is described in EXHIBIT H attached
hereto.

SECTION 11.02 -   CONDEMNATION

If the whole or more than twenty (20%) per cent of the Demised Premises is taken
by any governmental  agency or corporation  vested with the right of exercise of
eminent domain, whether such taking be effected by Court action or by settlement
with the agency  exercising  or  threatening  to exercise  such power and if the
property so taken  renders the remainder of the Demised  Premises  unfit for the
use  thereof by Tenant,  then  Tenant  shall have the option to  terminate  this
Lease, which option must be exercised by notice in writing, received by Landlord
within  sixty  (60)  days of such  taking.  if the  Tenant  shall  not  elect to
terminate,  or if the taking does not interfere with Tenant's use of the Demised
Premises to the extent Tenant does not have an option to terminate,  there shall
be an  adjustment of all rents  reflecting on a pro-rata  basis any reduction in
the Demised Premises.

If the whole of the Demised  Premises  shall be acquired or condemned by eminent
domain for any public or quasi-public use or purpose, then the Term of the Lease
shall  cease and  terminate  as of the date of title  vesting in such  public or
quasi public entity and all rents shall be paid up to that date and Tenant shall
have no claim against Landlord nor the condemning authority for the value of any
unexpired Term of this Lease.  In the event of a partial taking or  condemnation
which is not extensive enough to render the Demised Premises  unsuitable for the
business of the Tenant, the Landlord shall promptly restore the Demised Premises
to .a condition  comparable  to its  condition at the time of such  condemnation
less the portion lost in the taking, and this Lease shall continue in full force
and effect with the rents proportionally adjusted.

If the whole,  or a  substantial  part,  as  determined  by Landlord in its sole
discretion,  of the common  parking  areas  shall be acquired  or  condemned  as
aforesaid,  then the term of this Lease shall cease and terminate as of the date
of title  vesting in such public or quasi public entity  unless  Landlord  shall
take immediate steps to provide other suitable parking facilities,  In the event


                                       17
<PAGE>

that Landlord shall provide such other parking facilities, then this Lease shall
continue in full force and effect without any reduction or abatement of rent.

In the  event of any  condemnation  or  taking as  aforesaid,  whether  whole or
partial, the Tenant shall not be entitled to any part of the award paid for such
condemnation  and  Landlord is to receive  the full  amount of such  award,  the
Tenant hereby expressly waiving any right to claim to any part thereof. Although
all  damages  in the event of any  condemnation  are to belong to the  Landlord,
whether such damages are awarded as compensation  for diminution in value of the
leasehold  or to the fee of the  Premises,  Tenant shall have the right to claim
and  recover  from  the  condemning  authority,  but  not  from  Landlord,  such
compensation  as may be separately  awarded or recoverable by Tenant in Tenant's
own on  account  of any and all  damage to  Tenant's  business  by reason of the
condemnation  and for or on account of any cost or loss to which Tenant might be
put  in  removing   Tenant's   merchandise,   furniture,   fixtures,   leasehold
improvements and equipment.

                                   ARTICLE 12
                    DEFAULT BY TENANT AND LANDLORD'S REMEDIES

SECTION 12.01 -   EVENTS OF DEFAULT

For purposes of this Lease,  the  occurrence of any one or more of the following
shall constitute an "Event of Default" hereunder:

         (a)      Tenant fails to pay any Monthly Minimum Rent, Adjusted Monthly
                  Minimum Rent,  Additional Rents or other monetary  payments as
                  and when provided in this Lease; or

         (b)      Tenant breaches any other covenant,  term, condition agreement
                  or  obligation  herein  set forth and shall  fail to cure such
                  breach within ten (10) days after written notice;  PROVIDED IF
                  TENANT COMMENCES A CURE WITHIN SUCH THIRTY (30) DAY PERIOD AND
                  DILIGENTLY  AND IN GOOD FAITH  CONTINUES  TO EFFECT SAID CURE,
                  THE LANDLORD SHALL EXTEND THE PERIOD OF THE TIME TO CURE SAME;

         (c)      The  commencement  in any court or tribunal of any proceeding,
                  voluntary  or  involuntary,  to declare  Tenant  insolvent  or
                  unable to pay its debts as and when due;

         (d)      The assignment by Tenant of all or any part of its property or
                  assets for the benefit of creditors;

         (e)      The levy or  execution,  attachment,  or taking  of  property,
                  assets, or the leasehold  interest of Tenant by process of law
                  or otherwise in satisfaction of any judgment, debt, or claim;

         (f)      The  filing by Tenant of any  petition  or action  for  relief
                  under    any    creditor's    law    (including    bankruptcy,
                  reorganization,  or  similar  actions),  either  in  state  or
                  federal court;



                                       18
<PAGE>

         (g)      The filing against Tenant of any petition or action for relief
                  under    any    creditor's    law    (including    bankruptcy,
                  reorganization,  or  similar  actions),  either  in  state  or
                  federal court; which is not dismissed within sixty (60) days.

         (h)      Failure  to  comply  with  Section  4.02  Hazardous  Waste and
                  Related Matters.

Upon the  occurrence  of any Event of  Default,  Landlord  shall be  entitled by
written  notice to the Tenant to either (1) terminate the Term hereof or (ii) to
terminate  Tenant's right to possession or occupancy only,  without  terminating
the Term of this Lease. Unless the Term is specifically- terminated by notice in
writing,  it shall be  assumed  that  the  Landlord  has  elected  to  terminate
possession only, without terminating the Term.

The remedies of terminating  the Term or of terminating  possession  shall be in
addition  to and not in  limitation  of any rights  otherwise  available  to the
Landlord  and the  exercise  of any rights on  default  shall not  preclude  the
exercise of any other rights available to the Landlord at law or in equity.

SECTION 12.02 -   LANDLORD'S RIGHTS ON TERMINATION OF TERM OR POSSESSION

Upon any termination of the Term hereof,  whether by lapse of time or otherwise,
or upon any  termination  of Tenant's  right to  possession  or occupancy  only,
without  terminating  the Term hereof,  Tenant shall  surrender  possession  and
vacate  the  Demised  Premises  and  shall  deliver  possession  thereof  to the
Landlord;  and Tenant  hereby  grants to Landlord full and free license to enter
into and upon the Demised  Premises in such event and with or without process of
law to repossess  the Demised  Premises as of  Landlord's  former  estate and to
expel or remove Tenant and any others who may be occupying the Demised  Premises
and to remove therefrom any and all property,  using for such purpose such force
as may be necessary without being guilty of or liable for trespass,  eviction or
forcible entry or detainer and without relinquishing Landlord's right to rent or
any other right given to Landlord  hereunder or by  operation of law.  Except as
otherwise  expressly provided in this Lease,  Tenant hereby expressly waives the
service and demand for payment of rent or for possession of the Demised Premises
or to re-enter the Demised Premises,  including any and every form of demand and
notice prescribed by any statute or any other law.

If Landlord  elects to  terminate  Tenant's  right to  possession  only as above
provided,  without terminating the Term hereof, Landlord at its option may enter
into the Demised  Premises,  remove  Tenants's  property and other  evidences of
tenancy and take and hold  possession  thereof without such entry and possession
terminating the Term hereof and without  releasing Tenant from its obligation to
pay rents herein  reserved  for the full Term hereof.  Upon and after entry into
possession without terminating such obligations,  Landlord may, but shall not be
obligated to, relet the Demised Premises,  or any part for the account of Tenant
to any person,  firm or  corporation  other than Tenant for such rent,  for such
time, and upon such terms as Landlord in its sole discretion shall determine. If
any rent collected by Landlord upon any such  reletting for Tenant's  account is


                                       19
<PAGE>

not  sufficient  to pay monthly  the full  amount of the rent  herein  reserved,
(including  Monthly Minimum Rents,  Adjusted  Monthly Minimum Rents,  Additional
Rents, and other charges), and not theretofore paid by Tenant, together with the
costs of any repairs, alterations, or redecoration necessary for such reletting,
Tenant shall pay to Landlord the amount of each monthly  deficiency upon demand,
and if the rent so collected  from such reletting is more than enough to pay the
full amount of the rents reserved hereunder and all of the aforementioned costs,
Landlord  shall  be  entitled  to  retain  such  excess.   Notwithstanding   any
termination  of the right to possession  without  termination  of the Term,  the
Landlord  expressly  reserves the right, at any time after there  termination of
possession, to terminate the Term of this Lease by notice of such termination to
Tenant.

Tenant, upon expiration or termination of this Lease, either by lapse of time or
otherwise,  agrees  peaceably to surrender to Landlord the Demised  Premises and
Landlord's Personal Property in broom-clean condition and in good repair, normal
wear and tear  excepted.  In the event  Tenant  shall fail to leave the  Demised
Premises  upon  expiration or  termination  of this Lease,  unless  Landlord has
agreed in  writing  to permit  Tenant to  remain on the  Demised  Premises  on a
month-to- month basis at the most recent rental rate,  Landlord,  in addition to
all other remedies  available to it hereunder,  shall have the right to receive,
as rents for all the time  Tenant  shall so  retain  possession  of the  Demised
Premises,  or any part  thereof,  an amount equal to One Hundred  Fifty  Percent
(150%) of the Monthly  Minimum Rent and Additional  Rents  specified in Sections
1.04, in Article 2 or otherwise in this Lease, as applied to such period.

                                   ARTICLE 13
                            MISCELLANEOUS PROVISIONS

SECTION 13.01 -   ASSIGNMENT OF LEASE - SUBLEASE

Tenant may not assign or encumber this Lease, and may not sublet any part or all
of the Demised Premises without the written consent of Landlord, which shall NOT
BE UNREASONABLY WITHHELD OR DELAYED.  LANDLORD'S CONSIDERATION OF REASONABLENESS
MAY INCLUDE THE ASSIGNEE OR SUBLESSEE'S COMPATIBILITY WITI4 EXISTING TENANTS AND
THE  COMPATIBILITY OF LEASING SPACE TO NEW TENANTS.  TENANT MAY ASSIGN OR SUBLET
THIS  LEASE TO AN  AFFILIATE  PERSON  OF TENANT  PROVIDED  THAT  LANDLORD  SHALL
DETERMINE IN ITS REASONABLE  DISCRETION  THAT SUCH AFFILIATE IS COMPATIBLE  WITH
EXISTING  TENANTS AND WITH THE LEASING OF SPACE TO NEW TENANTS.  FOR PURPOSES OF
THIS  SECTION  13.01,  THE WORDS  "AFFILIATE  PERSON OF TENANT"  MEANS A PERSON,
DIRECTLY OR INDIRECTLY, THROUGH ONE OR MORE INTERMEDIARIES, CONTROLLED BY TENANT
OR UNDER  COMMON  CONTROL  WITH  TENANT.  Any  assignment  or  sublease to which
Landlord may consent  (one consent not being any basis to contend that  Landlord
should  consent  to a further  change)  shall not  relieve  Tenant of any of its
obligations  hereunder.  In no event shall this Lease be assignable by operation
of any law,  and  Tenant's  rights  hereunder  may not become,  and shall not be
listed by Tenant as an asset under any bankruptcy, insolvency, or reorganization
proceedings.  Tenant is not, may not become, and shall never represent itself to
be a agent of Landlord, and Tenant expressly recognizes that Landlord's title is
paramount, and that it can do nothing to affect or impair Landlord's title.

SECTION 13.02 -   OUTET ENJOYMENT

If  Tenant  promptly  and  punctually  complies  with  each  of its  obligations
hereunder,  it shall  peacefully  have and enjoy the  possession  of the Demised
Premises during the Term hereof, providing that no action of Landlord in work in
other space in the Building,  or in repairing or restoring the Demised Premises,
shall be deemed a breach of this  covenant,  or give  Tenant any right to modify
this Lease either as to Term,  rent payable,  or other  obligations  to perform.


                                       20
<PAGE>

However,  Landlord  shall not be  responsible  or liable to Tenant for injury or
damage resulting from acts or omissions of persons  occupying  property adjacent
to the  Demised  Premises  or any  part of the  Building  in which  the  Demised
Premises are a part, of for injury or damage resulting to Tenant or its property
from bursting,  stoppage or leaking of water, gas, sewer or steam pipes,  except
where such loss or damage arises from the willful misconduct of Landlord.

SECTION 13.03 -   SECURITY DEPOSIT

Landlord  shall  retain the  Security  Deposit as  additional  security  for the
performance by Tenant of each of its obligations  hereunder.  If Tenant fails at
any time to perform  its  obligations,  Landlord  may at its  option  apply said
deposit or so much  thereof as is required,  to cure  Tenant's  default,  but if
prior to the termination of this Lease,  Landlord depletes said deposit in whole
or in part, Tenant shall immediately restore the amount so used by Landlord, the
obligation  to so restore to be regarded  as the  obligation  to pay  Additional
Rent.  This deposit  shall not bear  interest,  and unless the Landlord uses the
same to cure a default of Tenant,  or to restore  the  Demised  Premises  to the
condition  that Tenant is required to leave them at the  conclusion of the Term,
Landlord shall,  within thirty (30) days of the termination of the Lease, refund
to Tenant, so much of the deposit as it continues to hold. If Landlord transfers
its interest in the Premises  during the Term,  Landlord may assign the Security
Deposit to the transferee and thereafter shall have no further liability for the
return of such Security Deposit.

SECTION 13.04 -   NOTICES

Any notices which Landlord or Tenant is required or desires to give to the other
shall be  deemed  sufficiently  given or  rendered  if,  in  writing,  delivered
personally,  or sent by certified or registered mail,  postage  prepaid,  to the
address listed after the respective signatures on the last page of this Lease.

Any notice  given  herein  shall be deemed  delivered  when the  return  receipt
therefore is signed,  or refusal to accept the mailing by the addressee is noted
thereon by the postal authorities.

SECTION 13.05 -   LIABILITY OF LANDLORD

In the event Landlord  shall fail to perform any covenant,  term or condition of
this Lease upon Landlord's part to be performed,  Tenant covenants and agrees to
look solely to  Landlord's  estate and interest in the Demised  Premises and the
Building in which the  Demised  Premises  are located for any  recovery of money
judgment from Landlord  from and after the date of this Lease  Agreement.  In no
event  is  Landlord,   its  officers  or  employees  or  an  individual  member,
shareholder,  general  or limited  partner  of  Landlord,  or any  successor  in
interest thereof, ever to be personally liable for any such judgment.

SECTION 13.06 -   SALE BY LANDLORD

The  Landlord may at any time assign or transfer its interest as Landlord or may
sell or transfer its interest in the property of which the Demised Premises is a
part.  The term Landlord as used in this Lease so far as the and  obligations on
the part of the Landlord are concerned, hall be limited to mean and include only
the owner or owners of the Demised  Premises at the time in question  and in the
event of any transfer or conveyance of the  Landlord's  title to such  property,
other than by an assignment for security  only, the grantee shall  automatically


                                       21
<PAGE>

be substituted and the grantor shall  automatically be released from any and all
liability   arising  with  respect  to  the  performance  of  any  covenants  or
obligations after the effective date of any such sale.

SECTION 13.07 -   BROKERAGE

Tenant  warrants  that it has had no  dealings  with  any  broker  or  agent  in
connection  with this Lease,  other than DEE CREECH  HALLYBURTON  OF  CAROLANTIC
REALTY,  INC.,  and covenants to pay, hold harmless and indemnify  Landlord from
and  against,  any and all cost,  expense  or  liability  for any  compensation,
commissions  and charges  claimed by any other  broker or agent with  respect to
this Lease or the negotiation thereof.

SECTION 13.08 -   ROOF AND WALLS

Landlord  shall have the  exclusive  right to use all or any part of the roof of
the Building for any purpose;  to erect other structures over all of any part of
the Building; and to erect in connection with the construction thereof temporary
scaffolds  and  other  aids  to  construction  on the  exterior  of the  Demised
Premises, provided that access to the Demised Premises shall not be denied.

SECTION 13.09 -   SPECIAL PROVISIONS - EXHIBIT C

Notwithstanding any contrary provisions hereof, the provisions, if any contained
within  EXHIBIT C constitute  special  provisions  and agreements of the parties
which shall supersede any provisions of this Lease which are  inconsistent  with
the provisions stated within EXHIBIT C.

SECTION  13.10  -  GENERAL  RULES  FOR  INTERPRETING  THIS  LEASE.  Headings  of
paragraphs  are for  convenience  only and shall not be considered in construing
the meaning of the contents of such paragraph.

The  acceptance  of rentals and other  payments  by  Landlord  for any period or
periods  after an Event of Default shall not be deemed a waiver of any rights on
the part of the Landlord to terminate this Lease for any other Event of Default.
No waiver by Landlord of any of the terms or  conditions  of this Lease shall be
construed as a waiver by Landlord of any subsequent Event of Default.

The  invalidity  of any provision of this Lease shall not have any effect on the
balance hereof.

Should Landlord or Tenant institute any legal proceedings  against the other for
breach of any  provision  herein  contained,  and  prevail in such  action,  the
non-prevailing party shall in addition.




                                       22
<PAGE>



IN WITNESS  WHEREOF,  Landlord and Tenant have  executed this Lease in duplicate
originals, all as of the day and year first above written.

                                   LANDLORD:

                                   Southport Business Park Limited Partnership,

                                   BY:      Southport Business Park Investors
                                            Corporation, General Partner


                                                                         (SEAL)
                                     ------------------------------------
                                            Robert T. Karp
                                            Vice President

[CORPORATE SEAL]

                                   ATTEST:

                                   BY:                                   (SEAL)
                                       ----------------------------------
                                                     (Asst) Secretary

ADDRESS FOR LANDLORD FOR NOTICES UNDER LEASE:

SOUTHPORT BUSINESS PARK LIMITED PARTNERSHIP
101 Southcenter Court, Suite 1100
Morrisville, NC 27560

GENERAL COUNSEL
General Investment & Development Co.
600 Atlantic Avenue, Suite 2000
Boston, MA 02210

*******************************************************************
                               TENANT:

                               Home Director, Inc.

                               BY:                                       (SEAL)
                                   --------------------------------------
                                        Steve Carnevale
                                        Chief Financial Officer

                               ATTEST:

                               BY:                                       (SEAL)
                                   --------------------------------------
                                        Jane Crewell, Secretary

ADDRESS FOR TENANT FOR NOTICES UNDER THIS LEASE:

Director of Contracts and Legal Affairs
Home Director, Inc.
1015 Aviation Parkway, Suite 100
Morrisville, North Carolina 27560
*******************************************************************



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