<PAGE>

                                                                   EXHIBIT 10.21

                            FIRST AMENDMENT TO LEASE

      THIS FIRST AMENDMENT TO LEASE (this "AMENDMENT") is entered into to be
effective as of Nov 5, 2004, by and between GUS ENTERPRISES-XII, L.L.C., a New
Jersey limited liability company ("LANDLORD"), and WHITE ELECTRONIC DESIGNS
CORPORATION, an Indiana corporation ("TENANT").

                                    RECITALS

      A. Landlord (as successor-in-interest of Allred Phoenix Properties, LLC, a
Delaware limited liability company) and Tenant (as successor-in-interest of
Bowmar Instrument Corp., an Indiana corporation) are parties to that certain
Industrial Real Estate Lease dated as of February 4, 1997 (the "LEASE"),
covering approximately 43,129 net rentable square feet of space (the "EXISTING
PROPERTY") in the building located at 3601 East University Drive, Phoenix,
Arizona. Any capitalized term used but not defined herein shall have the same
meaning given to such term in the Lease.

      B. Landlord and Tenant desire to amend the Lease as more particularly set
forth below.

                                    AGREEMENT

      NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are mutually acknowledged, the parties agree as follows:

      1. EXPANSION. Landlord leases to Tenant, and Tenant leases from Landlord,
approximately 30,600 net rentable square feet of space (the "EXPANSION
PROPERTY") as shown on EXHIBIT "A" attached hereto. The depiction attached to
the Lease as EXHIBIT "A" is deleted and replaced by EXHIBIT "A" attached to this
Amendment, and the term "PROPERTY" as used in the Lease means and includes
approximately 73,729 net rentable square feet of space, being the sum of the
area of the Existing Property and the Expansion Property. The lease of the
Expansion Property is subject to all of the terms and conditions of the Lease
currently in effect, except as modified in this Amendment. Tenant acknowledges
that it has no further expansion rights or options, rights of first refusal or
other preferential rights under the Lease.

      2. TENANT'S PRO RATA SHARE. As a result of the addition of the Expansion
Property to the Existing Property, Tenant's pro rata share shall be 58.63%.

      3. EXTENSION. The Lease Term is extended through July 31, 2015. The
renewal options contained in Article 16 of the Lease are deemed void and of no
further force or effect (and the lease renewal tenant improvement allowance
contained in Article 17 of the Lease and the Base Rent calculation contained in
Section 30 of the Addendum to the Lease relating to such renewal options are
also deemed void and of no further force or effect), and Tenant acknowledges
that it has no further extension or renewal rights or options under the Lease,
except as provided in SECTION 8 below.

      4. BASE RENT. The Base Rent from and after the date hereof through the
expiration of the Lease Term (as extended pursuant to SECTION 4 above) shall be
payable as follows:

<PAGE>

<TABLE>
<CAPTION>
            Period             Monthly Base Rent Amount
            ------             ------------------------
<S>                            <C>
The date hereof - May 31, 2005         $37,944.63
  June 1, 2005 - May 31, 2007          $65,618.81
  June 1, 2007 - May 31, 2009          $68,862.89
  June 1, 2009 - May 31, 2011          $72,254.42
  June 1, 2011 - May 31, 2013          $75,940.87
  June 1, 2013 - July 31, 2015         $79,627.32
</TABLE>

      Payments of Base Rent shall be accompanied by applicable transaction
privilege taxes, rental taxes and/or similar taxes or charges. The Base Rent
adjustments contained in Section 1.12(a) of the Lease and Section 2 of the
Addendum to the Lease are deemed void and of no further force or effect.

      5. LEASEHOLD IMPROVEMENTS. Tenant accepts the Expansion Property and the
Existing Property in their respective "as-is" condition. Tenant acknowledges
that Landlord has not undertaken to perform any modifications, alterations or
improvements to the Expansion Property or the Existing Property or to provide
any leasehold improvement allowance therefore, except as provided in the
Construction Agreement attached hereto as EXHIBIT "B" (which agreement provides
for a construction allowance from Landlord in the amount of $400,000.00).

      6. SECURITY DEPOSIT. The Security Deposit is increased by $32,742.00,
which, when combined with the existing Security Deposit of $32,778.00, results
in a total Security Deposit of $65,520.00. Tenant shall deposit with Landlord
the amount of such increase within 3 business days after the date of this
Amendment. Notwithstanding anything contained in the Lease or the Addendum to
the Lease to the contrary, Landlord shall not be required to hold the Security
Deposit in a separate account or to pay or collect interest on the Security
Deposit.

      7. MEZZANINE. Section 32 of the Addendum to the Lease shall apply to the
Expansion Property; provided that, with respect to the Expansion Property only,
the last sentence of Section 32 of the Addendum to the Lease shall be deemed to
be deleted in its entirety and replaced with the following:

            The second level of the Expansion Property (the "Mezzanine") shall
            remain with the Property upon Lease termination; provided, however,
            at Landlord's election, Landlord may remove at Lease termination or
            within ninety (90) days thereafter all or any portion of the
            Mezzanine that Landlord may designate, and in connection therewith,
            Tenant shall, subject to the $50,000.00 limitation set forth below,
            reimburse Landlord for the cost of the removal of up to ninety
            percent (90%) of the Mezzanine at the rate of $2.00 per square foot
            of the mezzanine space being removed. Notwithstanding the foregoing,
            in no event shall Tenant be required to pay in excess of $50,000.00
            in connection with such reimbursement of Landlord.

      8. OPTION TO EXTEND.

                                       2
<PAGE>

      (a) Tenant may, at its option, extend the Lease Term for two renewal
periods of five years each (each, a "RENEWAL PERIOD") by written notice to
Landlord (the "RENEWAL NOTICE") given no later than 120 days prior to the
expiration of the Lease Term (or the prior Renewal Period, as applicable),
provided that at the time of such notice and at the commencement of such Renewal
Period, (i) Tenant remains in occupancy of the Property, and (ii) no uncured
event of default exists under the Lease. The Base Rent initially payable during
the Renewal Period shall be equal to 105% of the Base Rent in effect under the
Lease immediately prior to the commencement of such Renewal Period, effective as
of the first month of the Renewal Period. Such Base Rent shall subsequently
continue to increase every twenty-four (24) months thereafter by an amount equal
to five percent (5%) of the immediately prior Base Rent amount. With respect to
the first Renewal Period only, Landlord shall provide a leasehold improvement
allowance of $3.00 per net rentable square foot of space within the Premises.
Landlord shall not be required to provide any leasehold improvement allowance
for the second Renewal Period. Except as provided in this SECTION 8, all terms
and conditions of the Lease (as amended by this Amendment) shall continue to
apply during the Renewal Period.

      (b) If Tenant timely delivers its Renewal Notice, Tenant and Landlord
shall, within 15 days after receipt, execute a lease amendment confirming the
Base Rent and other terms applicable during the Renewal Period. If Tenant fails
timely (i) to deliver its Renewal Notice or (ii) to execute and return the
required lease amendment, then this Option to Extend shall automatically expire
and be of no further force or effect. In addition, this Option to Extend shall
terminate upon assignment of the Lease or subletting of all or any part of the
Project.

      9. BROKER. Landlord and Tenant represent and warrant each to the other
that it has not dealt with any real estate broker or salesman other than CB
Richard Ellis, Inc. ("BROKER") in connection with the negotiation or execution
of this Amendment and no such broker or salesman has been involved in connection
with this Amendment, and each party agrees to indemnify, defend and hold
harmless the other party from and against any and all costs, expenses,
attorneys' fees and liability for any compensation, commission or charges
claimed by any real estate broker or salesman other than Broker due to the acts
of such party or such party's representatives.

      10. TIME OF THE ESSENCE. Time is of the essence with respect to Tenant's
execution and delivery to Landlord of this Amendment. If Tenant fails to execute
and deliver a signed copy of this Amendment to Landlord by 5:00 p.m., local time
where the Property is located, on November 5, 2004, this Amendment shall be
deemed null and void and shall have no force or effect, unless otherwise agreed
in writing by Landlord. Landlord's acceptance, execution and return of this
Amendment shall constitute Landlord's agreement to waive Tenant's failure to
meet such deadline.

      11. MISCELLANEOUS. This Amendment shall become effective only upon full
execution and delivery of this Amendment by Landlord and Tenant. This Amendment
contains the parties' entire agreement regarding the subject matter covered by
this Amendment, and supersedes all prior correspondence, negotiations and
agreements, if any, whether oral or written, between the parties concerning such
subject matter. There are no contemporaneous oral agreements, and there are no
representations or warranties between the parties not contained in this
Amendment. Except as modified by this Amendment, the terms and provisions of the
Lease shall remain in full force and effect, and the Lease, as modified by this
Amendment, shall be binding upon and shall inure to the benefit of the parties
hereto, their successors and permitted assigns. This Amendment may be

                                       3
<PAGE>

executed in any number of counterparts, each of which shall be an original and
all of which taken together shall be one instrument.

                  [Remainder of Page Intentionally Left Blank]

                                       4
<PAGE>

      IN WITNESS WHEREOF, this First Amendment to Lease has been executed by the
parties to be effective as of the date first set forth above.

                              Landlord:

                              GUS ENTERPRISES-XII, L.L.C., a New Jersey
                              limited liability company

                              By: Cabot Properties, Inc., its Authorized Agent

                                  By: /s/ Janine M. Cobb
                                     -----------------------------------------
                                  Name:  Janine M. Cobb
                                  Title: Senior Vice President

                              Tenant:

                              WHITE ELECTRONIC DESIGNS
                              CORPORATION, an Indiana corporation

                              By: /s/ Roger A. Derse
                                  --------------------------------------------
                              Name:  Roger A. Derse
                              Title: VP/CFO

                                       5
<PAGE>

                                   EXHIBIT "A"

                   (Existing Property and Expansion Property)

                                       A-1
<PAGE>

                                   EXHIBIT "B"

                             CONSTRUCTION AGREEMENT

      This Construction Agreement ("Agreement") is attached as an Exhibit to a
First Amendment to Lease between GUS ENTERPRISES-XII, L.L.C., a New Jersey
limited liability company, as Landlord, and WHITE ELECTRONIC DESIGNS
CORPORATION, an Indiana corporation, as Tenant. Unless otherwise specified, all
terms used herein shall have the same meanings as in the Lease.

1. Approved Construction Documents.

      (a) Construction Documents. Tenant shall submit to Landlord complete,
finished and detailed architectural, mechanical, electrical and plumbing
drawings and specifications for the Work (as defined below), together with all
supporting information and delivery schedules ("Construction Documents"). Such
Construction Documents shall be prepared by architects and/or engineers licensed
in the State of Arizona and approved by Landlord in writing in advance. Tenant
shall use commercially reasonable efforts to cause its architects and/or
engineers to design the Work and prepare the Construction Documents in full
compliance with applicable law.

      (b) Construction Schedule. Tenant's submission of the Construction
Documents shall also include a date flow chart providing a schedule (the
"Construction Schedule") of the anticipated dates of completion of the various
phases of construction of the Work. The Construction Schedule shall be in such
detail as to permit the Landlord to identify the scheduled dates of completion
of each material phase of construction of the Work under the Approved
Construction Documents (as defined below). The proposed Construction Schedule is
part of and shall be included in the definition of Construction Documents. All
references in this Agreement to the Construction Schedule shall refer to the
Construction Schedule approved by Landlord in accordance with Paragraph 1(c).

      (c) Landlord's Approval. Within 10 calendar days after receipt of Tenant's
Construction Documents, Landlord (or its designated architectural and/or
engineering firm) shall approve or disapprove such documents in writing. If
Landlord disapproves, Landlord shall provide Tenant in writing specific reasons
for such disapproval. Tenant shall submit corrected Construction Documents
within 10 days of receipt of Landlord's disapproval notice. Landlord shall
approve or disapprove the corrected Construction Documents within 5 additional
days from receipt of the corrected Construction Documents. Tenant shall submit
further corrected Construction Documents, if necessary, within 5 additional days
from receipt of Landlord's disapproval notice. Such 5 day periods for review and
correction shall be repeated until Construction Documents satisfactory to
Landlord are completed. Upon Landlord's approval, the Construction Documents
shall become the "Approved Construction Documents".

      (d) Approval Standard. Except as otherwise provided in this Agreement,
with respect to any and all provisions in this Agreement which provide for or
require Landlord's consent or approval, Landlord shall not unreasonably
withhold, delay or condition such approval; provided, however, among the factors
that Landlord may consider in determining whether to grant or withhold its
consent under this Agreement are, without limitation, the effect that the
requested Construction Documents or modifications or additions to the
Construction Documents, any proposed contractor or

                                      B-1
<PAGE>

subcontractor, or other matter with respect to which Landlord's consent is
requested would have on (i) the structural integrity of the Project or the
Property, (ii) the aesthetic appearance of the Project or the Property, (iii)
the safety of persons and property within the Project, and (iv) the compliance
of the Project and the Property with applicable law.

      (e) Landlord's Liability. Tenant acknowledges that Landlord is not an
architect or engineer. Accordingly, Landlord does not guarantee or warrant that
the Approved Construction Documents will comply with applicable law, be free
from errors or omissions, or result in construction of a safe place of
habitation, nor that the Work will be free from defects or unsafe conditions,
and Landlord will have no liability therefor.

2. Pricing, Bids, and Construction Contract.

      (a) Proposed Contractors. Following receipt of the Approved Construction
Documents, Tenant will promptly price the construction of the Work in accordance
with the Approved Construction Documents and furnish to Landlord written notice
of the names of the general contractor, subcontractors, and suppliers Tenant
proposes to use for executing the Work.

      (b) Tenant's Contractors. "Tenant's Contractor" shall mean a fully
qualified and properly licensed contractor selected by Tenant, identified in
Tenant's written price estimates, and approved in writing by Landlord to act as
the general contractor responsible for construction of the Work. "Tenant's
Subcontractors" shall mean Tenant's architect, engineers, employees, agents,
subcontractors and suppliers selected by Tenant or Tenant's Contractor,
identified in Tenant's written price estimates, and approved in writing by
Landlord to contribute to the construction of the Work.

      (c) Tenant's Construction Contract. Prior to commencing work, Tenant or
Tenant's Contractor shall provide Landlord with a copy of the original
contract(s) under which the Work will be performed (the "Construction
Contract"). Landlord reserves the right to condition commencement of the portion
of the Work covered by the Construction Contract upon execution of an amendment
to the Construction Contract to correct provisions that in Landlord's
commercially reasonable judgment pose an unreasonable threat to Landlord, the
Building, or the Project, although Landlord shall have no liability for review
or failure to review the Construction Contract.

      (d) Change Orders. All change orders that affect the structural integrity
of the Project that involve more than $1,000.00 in costs must be approved in
advance in writing by Landlord.

      (e) Delay Caused By Landlord. In the event Landlord unreasonably causes a
delay in the completion of the Work by unreasonably withholding its consent or
approval of any matter to be approved by Landlord as provided herein (subject to
Paragraph 1(c) above), including, but not limited to, the Construction Contract,
Construction Documents, Construction Schedule, Tenant's Contractor, Tenant's
Subcontractors or Application for Payment, then, as Tenant's sole and exclusive
remedy, the due date for the first payment of Base Rent applicable to the
Expansion Property shall be extended for the period of such delay.

3. Landlord's Contributions.

                                      B-2
<PAGE>

      (a) Construction Allowance. Landlord will reimburse Tenant a sum not to
exceed $400,000.00 (the "Construction Allowance"), for the cost of constructing
the Work in accordance with this Construction Agreement. The cost of all space
planning, design, consulting or review services and construction drawings shall
be included in the cost of the Work and may be paid out of the Construction
Allowance. Tenant represents and warrants to Landlord that the Construction
Allowance shall be used exclusively (subject to the provisions of this Paragraph
3) for permanent improvements to the Property which improvements shall become
the property of Landlord immediately upon installation and which improvements
shall not be removed from the Property after installation.

      (b) Payment of Construction Allowance. Based upon the applications for
payment (individually, an "Application for Payment") submitted to Landlord by
Tenant, Landlord will make progress payments to Tenant on account of the
Construction Allowance as set out below; provided, however, Tenant may not make
more than three (3) Applications for Payment prior to the final Application for
Payment, and each such interim Applications for Payment must relate to
constructed Work exceeding $100,000.00 in the aggregate.

            (i) Application for Payment. Tenant will submit a fully completed
and executed Application for Payment in form satisfactory to Landlord. Each
Application for Payment shall be for the aggregate cost of the Work constructed
during the preceding period less 10% security retainage (described in Paragraph
3(b)(vi) below) until the final Application for Payment as set forth below. The
costs and expenses for which reimbursement is requested shall be segregated and
detailed within a schedule attached to each Application for Payment.

            (ii) Certification of Applications for Payment. Each Application for
Payment shall be certified to be true and accurate by Tenant and Tenant's
Contractor as to the matters contained within it.

            (iii) Releases and Supporting Documents. Attached to and as a part
of each Application for Payment, Tenant shall furnish the following to Landlord:
(a) a duly executed partial release of lien rights in form satisfactory to
Landlord ("Partial Release"), current through the date of the Application for
Payment from Tenant's Contractor and each person entitled to a lien under
applicable law by virtue of contributing to the Work, including, without
limitation, Tenant's architect(s), engineer(s) or consultant(s) and Tenant's
Contractor's subcontractor(s), supplier(s) or materialmen, and (b) copies of all
invoices and other documentation supporting all amounts for which reimbursement
is requested in the Application for Payment, as referred to in the schedule of
costs and expenses attached to the Application for Payment.

            (iv) Liens. Any payment due to Tenant's Contractor hereunder shall
be reduced by an amount of up to 200% of the amount of any mechanics' or
materialmen's lien or affidavit claiming a lien arising from or related to the
construction of the Work until such lien or affidavit is removed of record or
Tenant furnishes a surety bond satisfactory to Landlord to indemnify Landlord,
its successors and assigns, against any such mechanics' or materialmen's lien.

            (v) Payment of Applications for Payment. Within 30 days after
Tenant's submission of an Application for Payment to Landlord as required in
this Agreement, Landlord shall make payment to Tenant of the amount requested in
the Application for Payment; provided,

                                      B-3
<PAGE>

however, Landlord shall be entitled to make such exceptions as Landlord may
reasonably deem appropriate with respect to those items set forth in the
Application for Payment which are incomplete, insufficiently described or not
supported by partial lien waivers and supporting invoices or other documentation
as required above. In addition, Landlord may withhold payment under any
Application for Payment to the extent that (A) the quotient obtained by dividing
(1) the sum of such payment, all prior payments made to Contractor, and
retainage withheld by Owner with respect to prior Applications for Payment, by
(2) the total Construction Allowance, would exceed (B) the percentage of the
Work completed through the date of the Application for Payment. If Landlord
makes any exceptions to an Application for Payment, Landlord shall provide
Tenant with a written explanation of the exception(s) within ten (10) days
following Landlord's receipt of Tenant's Application for Payment. Landlord shall
then make payment to Tenant of the amount requested in the Application for
Payment within ten (10) days following Landlord's receipt of Tenant's corrected
Application for Payment.

            (vi) Security for Completion. Ten percent (10%) of the amount
approved under each application for Payment shall be withheld by Landlord until
payment is made by Landlord under the final Application for Payment as provided
below. Tenant acknowledges that this is not retainage under the mechanic's lien
statute. Tenant is not acting as a contractor or an agent for Landlord.

            (vii) Payment of Final Application for Payment. Landlord shall not
be obligated to make any payment under the final Application for Payment until
the last to occur of (a) Landlord's receipt from Tenant of the architect's
certificate of substantial completion described in Paragraph 4(n) below, (b)
Landlord's receipt of final invoices marked paid or other evidence reasonably
satisfactory to Landlord confirming the total amount expended by Tenant for the
Work, (c) Landlord's approval of the Work as having been completed in accordance
with the Approved Construction Documents, which approval shall not be
unreasonably withheld, (d) Landlord's receipt of a final lien waiver in form
satisfactory to Landlord, covering the release of all mechanics' and
materialmen's liens or potential mechanic's and materialmen's liens that could
arise from the construction of the Work from Tenant's Contractor and each person
entitled to a lien under applicable law by virtue of contributing to the Work,
(e) an affidavit from Tenant and Tenant's Contractor that such final lien waiver
includes and covers all materials and services for which a lien could be filed,
provided that Tenant may, if any subcontractor or supplier refuses to furnish a
release in full, furnish a surety bond satisfactory to Landlord to indemnify
Landlord, its successors and assigns, against any mechanics' or materialmen's
lien, (f) Landlord's receipt of final as-built plans and specifications in a
form satisfactory to Landlord and certified by Tenant's architect or engineer as
accurately and completely depicting the Property as the completed Work, together
with all written warranties and guaranties and all operating and maintenance
manuals related to the Work, and (g) 35 days have elapsed from the last day of
the month in which the Work is completed including "punch-list" items, and no
affidavit as required by applicable law has been filed against the Property (or
Tenant's interest therein), the Building, or the Project, or notice of a claim
has been delivered to Tenant or Landlord, as a result of the Work, provided that
Tenant may furnish a surety bond satisfactory to Landlord to indemnify Landlord,
its successors and assigns, against any such claims.

            (viii) Additional Conditions for Payment. Notwithstanding any
provision contained in this Agreement to the contrary, Landlord shall not be
obligated to make any payment to Tenant if any one or more of the following
conditions exist: (a) Tenant is in default in the performance of any

                                      B-4
<PAGE>

of its obligations under this Agreement or an event of default exists under the
Lease; or (b) any part of such payment is attributable to work which is
defective or not performed in accordance with the Approved Construction
Documents, as determined by Landlord; provided, however, that such payment shall
be made as to the part of the requested payment attributable to work which is
performed in accordance with the Approved Construction Documents and is not
defective.

      (c) Unused Allowance(s). Any allowance Landlord is obligated to make
available to Tenant under this Construction Agreement must be utilized for its
intended purpose by April 6, 2006, or be forfeited with no further obligation on
the part of Landlord.

4. Construction.

      (a) The Work. The "Work" consists of all permanent leasehold improvements
described in the Approved Construction Documents.

      (b) Accomplishment of Work. Tenant shall construct, or cause to be
constructed through Tenant's Contractor, all of the Work in a good and
workmanlike manner, in accordance with the Approved Construction Documents, the
Construction Schedule and applicable law. All Tenant Parties, including Tenant's
Contractor and Tenant's Subcontractors, shall comply at all times with
Landlord's Conditions for Contractors, to the extent Landlord has provided the
same to Tenant prior to the date hereof. Tenant shall cause Landlord and its
designated property management and construction firm(s) to be added to the list
of beneficiaries of any warranties provided to Tenant in connection with
construction of the Work. Except as expressly provided otherwise in this
Agreement, Tenant shall have complete responsibility for all aspects of the
construction of the Work and the proper and timely completion of the Work in
accordance with this Agreement. Tenant shall cause all of the Work to be
substantially completed as expeditiously as reasonably possible in accordance
with the Approved Construction Documents, including the Construction Schedule.

      (c) Contractor and Subcontractor Insurance. Tenant shall require its
contractors and subcontractors to obtain and maintain, and provide certificates
of, all insurance required pursuant to the Lease, and in the manner required by
the Lease, in the performance of their respective work including, but not
limited to, Worker's Compensation Insurance as required by applicable law.

      (d) Bonds. At the request of Landlord, all of the Work shall be covered by
payment and performance bonds issued by a surety reasonably acceptable to
Landlord, and Tenant shall take such action as necessary to perfect Landlord's
interest in the bonds including filing such bonds of record prior to the
commencement of the Work, unless Landlord shall agree to the contrary in
writing.

      (e) Building Permits. Tenant shall, at its expense, obtain (and furnish a
copy to Landlord) all permits and approvals from all appropriate governmental
authorities prior to commencing construction of that portion of the Work then to
be constructed. Tenant's failure to do so shall not cause a delay of any
applicable rental commencement dates.

      (f) Construction Rules. Access to the Project, Building, and Property
during construction of the Work is conditioned upon compliance with Landlord's
Construction Rules, to the extent Landlord has provided the same to Tenant prior
to the date hereof.

                                      B-5
<PAGE>

      (g) Satisfactory Performance. Tenant shall assume responsibility for the
satisfactory performance of all work by Tenant's Contractor and Tenant's
Subcontractors including, without limitation, (i) the completion of any such
work which is prerequisite to occupancy according to the Construction Schedule,
(ii) the acceptability to Tenant and Landlord of the workmanship of Tenant's
Contractor and Subcontractors, (iii) all necessary cooperation and coordination
by Tenant's Contractor and Tenant's Subcontractors with the Landlord so as to
cause no interference with the business of other tenants in the Project, if any,
and (iv) for release of all liens arising from any work done by Tenant's
Contractor or Subcontractors. Failure to comply with the terms of this Agreement
shall be considered an event of default under the Lease.

      (h) Misconduct by Contractors. If at any time the entry or performance by
Tenant's Contractor or Tenant's Subcontractors shall materially interfere with
other tenants or violate the terms of this Agreement or the Lease, which
violation is not cured within five (5) days following written notice from
Landlord, Landlord may withdraw the license granted in this Agreement to use
Tenant's Contractor or Tenant's Subcontractors, as the case may be, and exclude
such Tenant's Contractor or Tenant's Subcontractor from the Project upon 24
hours written notice to Tenant (except in an emergency in which case no notice
shall be required).

      (i) Liabilities Arising from Construction; Indemnity. Except as caused by
Landlord's sole negligence, Landlord shall not be liable in any way for any
injury, loss or damage which may occur to any of Tenant's installations during
construction of the Work, the same being solely at Tenant's risk. Except as
caused by Landlord's sole negligence, Tenant shall indemnify and forever hold
harmless Landlord against any and all claims arising out of the performance of
any work by Tenant's Contractor and Tenant's Subcontractors or from Tenant's
failure to comply with the terms of this Agreement. While in or upon the
Property and the Project for the purposes of performing work, Tenant and
Tenant's Contractor shall comply with all terms and provisions of the Lease,
which shall govern the relationship of the parties except as expressly provided
otherwise in this Agreement.

      (j) Base Building Construction. Notwithstanding any other provision in
this Agreement, Landlord or its contractors will, at Tenant's expense, undertake
all work appertaining to those aspects of the Work which require roof
penetrations, drilling or cutting into the load bearing walls, exterior walls or
other structural support of the Building or modifications to any base Building
operating systems or any other structural components of the Building. Landlord
shall have the right to designate, in Landlord's sole and absolute discretion,
the contractor or subcontractors performing such work.

      (k) Utilities Used in Construction. Notwithstanding any other provision in
the Lease to the contrary, all charges for utilities consumed in the Property by
Tenant or Tenant's Contractor and Tenant's Subcontractors during and in
connection with the construction and installation of the Work, including
electricity, water and sewer, shall be paid by Tenant.

      (l) Maintenance of Property. Tenant shall require its contractors and
subcontractors to remove and dispose of all debris and rubbish caused by their
work on a daily basis in order to keep the job site in a neat, safe and orderly
condition and, upon completion of the Work, to remove all temporary structures,
debris and rubbish of whatever kind remaining on or about the Property.

                                      B-6
<PAGE>

                          LIST OF PROPOSED CONTRACTORS

HARDISON/DOWNEY CONSTRUCTION, INC.
6150 North 16th Street, Suite A
Phoenix, Arizona 85016-1705

Contact: Michael J. Mongelli
         Vice President of Construction

Phone:   602.861.0044
FAX:     602.366.1304

email: mmongelli@hardisondowney.com

JOHNSON CARLIER
738 South 52nd Street
Tempe, Arizona 85281-7211

Contact: Richard O. Heiny
         Vice President of Operations

Phone:   602.275.2222
FAX:     480.921.9255

email: dickh@johnsoncarlier.com

THE WEITZ COMPANY
5555 East Van Buren Street, Suite 155
Phoenix, Arizona 85008-3709

Contact: Paul Schoeffler
         Senior Preconstruction Manager

Phone:   602.302.7576
FAX:     602.273.6622

email: paul.schoeffler@weitz.com