<PAGE>   1

                            FIRST AMENDMENT TO LEASE


         THIS FIRST AMENDMENT TO LEASE ("Amendment") is made on this 8th day of
May, 1997, by and between BALA PLAZA, INC., a Delaware corporation ("Landlord"),
and PHILADELPHIA CONSOLIDATED HOLDING CORP., a Pennsylvania corporation
("Tenant").

                                   BACKGROUND

         A. The Prudential Insurance Company of America ("Prudential") and
Tenant entered into a certain Lease, dated as of August, 1995 (the "Lease"),
pursuant to which Prudential leased to Tenant approximately 16,880 rentable
square feet of space on the first floor and 3,550 rentable square feet of space
on the lower level (the "Premises") of the building known as One Bala Plaza
("Building") and upon lands located in Bala Cynwyd, Lower Merion Township,
Montgomery County, Pennsylvania (the "Property"). The Premises are more fully
described in the Lease. Capitalized terms used but not defined herein shall have
the respective meanings ascribed to such terms in the Lease.

         B. Landlord heretofore succeeded to the right, title and interest of
Prudential in and to the Building and the Property, and all of Prudential's
right, title and interest as the "Landlord" under the Lease was assigned to
Landlord.

         C. Subject to the conditions set forth in this Amendment, Landlord and
Tenant desire to amend the Lease to, among other things, (i) expand the Premises
by adding thereto approximately 2,210 rentable square feet of space located on
the first floor of the Building, shown outlined and hatched in black on the
Floor plan attached hereto as Exhibit A (the "Additional Space"), (ii) provide
for the performance by Landlord of certain improvements to the Additional Space,
(iii) adjust the annual Base Rent payable by Tenant under the Lease, and (iv)
adjust Tenant's Percentage.

         NOW, THEREFORE, in consideration of the mutual covenants and conditions
herein set forth and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, hereby agree as follows:

         1. Demise of Additional Space. Landlord hereby leases, demises and
lets unto Tenant the Additional Space, and Tenant hereby takes and hires the
Additional Space from Landlord, for the period commencing on the later date
("Additional Space Commencement Date") to occur of (a) August 1, 1997 or (b)
the second business day after the date that the improvements to the Additional
Space to be made by Landlord pursuant to Section 3 of this Amendment are
Substantially Completed (defined below), and terminating on February 28, 2003,
being the scheduled expiration date of the term of the Lease. As used herein,
the term "Substantially Completed" shall mean (i) that state of completion which
will enable Tenant to
<PAGE>   2
reasonably utilize the Additional Space for the conduct of its ordinary
business, even though certain work remains to be completed by Landlord, without
unreasonable interruption or disruption of Tenant's business, and (ii) any
required approvals shall have been issued by the appropriate governmental
agencies.

         Landlord and Tenant agree that effective on the Additional Space
Commencement Date, the Additional Space shall be (A) added to the Premises,
which shall comprise an aggregate of approximately 22,640 rentable square feet,
and (B) governed by all of the provisions of the Lease, as amended hereby.

         2. Adjustment of Annual Base Rent and Additional Rent.

                  (a) Effective on the Additional Space Commencement Date and
continuing through the expiration date of the term of the Lease, Tenant shall
pay Landlord annual Base Rent and monthly installments thereof for the
Additional Space as follows:

<TABLE>
<CAPTION>
                             Annual                Monthly              Base Rent
Period                       Base Rent             Base Rent            Per RSF
------                       ---------             ---------            -------
Additional Space
Commencement Date
<S>                          <C>                   <C>                  <C>
 to 02/28/98                 $48,620.00            $4,051.67            $22.00
03/01/98-02/28/99            $49,725.00            $4,143.75            $22.50
03/01/99-02/28/00            $50,830.00            $4,235.83            $23.00
03/01/00-02/28/01            $51,935.00            $4,327.92            $23.50
03/01/01-02/28/02            $53,040.00            $4,420.00            $24.00
03/01/02-02/28/03            $54,145.00            $4,512.08            $24.50
</TABLE>

Accordingly, effective on the Additional Space Commencement Date and continuing
through the expiration date of the term of the Lease, Tenant shall pay Landlord
annual Base Rent and monthly installments thereof for the entire Premises
(including the Additional Space) as follows:

<TABLE>
<CAPTION>
                             Annual                Monthly              Base Rent
Period                       Base Rent             Base Rent            Per RSF
------                       ---------             ---------            -------
Additional Space
Commencement Date
<S>                          <C>                   <C>                  <C>
  to 02/28/98                $381,730.00           $31,810.83           $16.86
03/01/98-02/28/99            $382,835.00           $31,902.92           $16.91
03/01/99-02/28/00            $383,940.00           $31,995.00           $16.96
03/01/00-02/28/01            $385,045.00           $32,087.08           $17.01
03/01/01-02/28/02            $386,150.00           $32,179.17           $17.06
03/01/02-02/28/03            $387,255.00           $32,271.25           $17.10
</TABLE>


                                        2
<PAGE>   3
                  (b) Effective on the Additional Space Commencement Date and
continuing through the expiration date of the term of the Lease, Tenant shall
pay to Landlord additional rent with respect to the Additional Space, including
without limitation additional rent under Article 5 of the Lease. For that the
purpose, (i) the Base Year under paragraph 5(c)(i) of the Lease shall remain the
1995 calendar year through the expiration date of the term of the Lease, and
(ii) Tenant's Percentage under paragraph 5(c)(iii) shall be increased from
5.593% to 6.198% effective on the Additional Space Commencement Date and
continuing through the expiration date of the term of the Lease.

         Notwithstanding any provisions of this Amendment to the contrary, if
the improvements to the Additional Space to be made by Landlord pursuant to
Section 3 of this Amendment are not Substantially Completed by August 1, 1997
because of any action by Tenant including, but not limited to, the failure by
Tenant to deliver Tenant's Drawings (defined in Section 3 hereof) to Landlord on
or before May 15, 1997, Tenant's obligation to pay annual Base Rent and
additional rent (including, without limitation, additional rent under Article 5
of the Lease) with respect to the Additional Space (as detailed in this Section
2) shall begin to accrue on August 1, 1997 as if the delay had not occurred.

         3. Improvement of Additional Space. At Landlord's expense, up to a
maximum of $44,200.00 ("Landlord's Additional Space Improvement Allowance"),
Landlord shall construct and improve the Additional Space in Landlord's Building
standard manner, in accordance with (i) Tenant's interior design drawings
("Tenant's Drawings"), (ii) final plans and specifications for such construction
and improvement, to be prepared by Tenant's architect, McGillin Architecture
(the "Plans and Specifications"), and (iii) mechanical and engineering drawings
to be prepared based upon the Plans and Specifications, and at Landlord's
expense (as part of Landlord's Additional Space Improvement Allowance) and shall
be submitted to Landlord on or before May 15, 1997, time being of the essence.
Landlord's Additional Space Improvement Allowance shall cover all design and
construction costs and fees, including a 1.25% construction management fee,
labor and materials, construction permits and reasonable overhead (collectively
"Improvement Costs"). In the event the Improvement Costs of the design and
construction of the Additional Space exceeds Landlord's Additional Space
Improvement Allowance, then Tenant shall pay Landlord the entire amount of the
excess, in lump sum, within ten (10) days after Landlord's billing therefor,
together with an itemization of the Improvement Costs. Landlord and Tenant shall
each have the right to approve the final construction cost set forth in the
applicable construction contract(s) for the construction of the Additional
Space.

         Except for the improvements to the Additional Space to be made by
Landlord pursuant to this Section 3 of this Amendment, Tenant accepts the
Additional Space in their "AS IS" condition as of the date of this Amendment.
Tenant acknowledges that neither Landlord, nor Landlord's agents,
representatives, employees, servants or attorneys have made any representations
or promises, whether express or implied, concerning the condition of the
Additional Space, and agrees that Landlord shall have no obligation to make any
alterations or


                                        3
<PAGE>   4
improvements to the Additional Space for or during the remainder of the term of
the Lease, except for the improvements to be made by Landlord pursuant to this
Section 3.

         4. Conditions to Effectiveness. The Additional Space is currently
leased by Landlord to Ann Langer, Jennifer Lapin and Gary Lutzky, individuals
doing business as Global Vision (the "Current Tenant") under a lease (the
"Current Tenant Lease") that is scheduled to expire on May 2, 1999. Landlord is
currently negotiating a termination agreement with the Current Tenant pursuant
to which, among other things, the term of the Current Tenant Lease would be
terminated as soon as possible. Landlord and Tenant agree that notwithstanding
any provision of this Amendment to the contrary, all rights and obligations of
each of Tenant and Landlord under this Amendment are subject to the fulfillment
or satisfaction of each of the following conditions: (a) the execution and
delivery by Landlord and Current Tenant on or before September 1, 1997 of a
mutually acceptable agreement pursuant to which the term of the Current Tenant
Lease is terminated, and (b) the Current Tenant and all persons claiming any
rights by or through the Current Tenant shall have vacated and surrendered the
Additional Space to Landlord on or before September 1, 1997. Landlord shall give
Tenant written notice of the fulfillment or satisfaction of such conditions
within five (5) days after such fulfillment or satisfaction. Within ten (10)
days after Tenant's receipt of such notice, Tenant shall pay to Landlord
$6,219.36, representing certain sums owing by Current Tenant to Landlord under
the Current Tenant Lease. The respective dates set forth in Sections 1, 2 and 3
of this Amendment were set based upon the assumption that the conditions set
forth in this Section 4 would be fulfilled or satisfied by April 30, 1997; and
if such conditions are not fulfilled or satisfied by that date, the respective
dates set forth in Sections 1, 2 and 3 of this Amendment will have to be
adjusted accordingly.

         5. Restatement of Certain Remedies. Paragraph 25(i) of the Lease is
hereby amended and restated in their entirety as follows:

         "(i) CONFESSION OF JUDGMENT FOR MONETARY AMOUNTS.

         (a) TENANT HEREBY EXPRESSLY AUTHORIZES THE PROTHONOTARY, CLERK OR ANY
         ATTORNEY OF ANY COURT OF RECORD TO ACCEPT SERVICE OF PROCESS FOR, TO
         APPEAR FOR, AND TO CONFESS JUDGMENT AGAINST TENANT AND ALL PERSONS
         CLAIMING UNDER TENANT IN ANY AND ALL ACTIONS BROUGHT HEREUNDER BY
         LANDLORD AGAINST TENANT TO ENFORCE PAYMENT OF ANY SUMS OWING HEREUNDER
         BY TENANT TO LANDLORD (AS RENT, ACCELERATED RENT OR OTHERWISE), WITH
         FIVE PERCENT (5%) ADDED THERETO AS ATTORNEY'S COLLECTION FEE, WITHOUT
         ANY LIABILITY ON THE PART OF SAID ATTORNEY, FOR WHICH THIS LEASE SHALL
         BE SUFFICIENT WARRANT, AND TENANT AGREES THAT UPON THE ENTRY OF SUCH
         JUDGMENT FOR POSSESSION A WRIT OF EXECUTION OR OTHER APPROPRIATE
         PROCESS MAY ISSUE FORTHWITH (WITHOUT ANY PRIOR WRIT OR PROCEEDING
         WHATSOEVER).


                                        4

<PAGE>   5
         IN ANY SUCH ACTION, LANDLORD SHALL FIRST CAUSE TO BE FILED IN SUCH
ACTION AN AFFIDAVIT MADE BY LANDLORD OR SOMEONE ACTING FOR IT SETTING FORTH
FACTS NECESSARY TO AUTHORIZE THE ENTRY OF JUDGMENT, OF WHICH FACTS SUCH
AFFIDAVIT SHALL BE CONCLUSIVE EVIDENCE, AND IF A TRUE COPY OF THIS LEASE BE
FILED IN SUCH ACTION (AND OF THE TRUTH OF THE COPY SUCH AFFIDAVIT SHALL BE
SUFFICIENT EVIDENCE), IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL AS A
WARRANT OF ATTORNEY, ANY RULE OF COURT, CUSTOM OR PRACTICE TO THE CONTRARY
NOTWITHSTANDING. TENANT AND ALL PERSONS CLAIMING UNDER TENANT HEREBY RELEASE
LANDLORD FROM ANY CLAIMS ARISING FROM ANY ERRORS OR DEFECTS WHATSOEVER IN
ENTERING SUCH ACTION OR JUDGMENT, IN CAUSING SUCH WRIT OF EXECUTION OR OTHER
PROCESS TO BE ISSUED OR IN ANY PROCEEDING THEREON OR CONCERNING THE SAME, AND
HEREBY AGREE THAT NO WRIT OF ERROR OR OBJECTION SHALL BE MADE OR TAKEN THERETO.

         THIS WARRANT OF ATTORNEY SHALL NOT BE EXHAUSTED BY ONE EXERCISE
THEREOF, BUT JUDGMENT MAY BE CONFESSED FROM TIME TO TIME AS OFTEN AS OCCASION
THEREFORE SHALL EXIST. SUCH POWERS MAY BE EXERCISED DURING AS WELL AS AFTER THE
EXPIRATION OR TERMINATION OF THE TERM AND DURING AND AT ANY TIME AFTER ANY
EXTENSION OR RENEWAL OF THE TERM OF THIS LEASE.

(b) CONFESSION OF JUDGMENT FOR POSSESSION. TENANT HEREBY EXPRESSLY AUTHORIZES
THE PROTHONOTARY, CLERK OR ANY ATTORNEY OF ANY COURT OF RECORD TO ACCEPT SERVICE
OF PROCESS FOR, TO APPEAR FOR, AND TO CONFESS JUDGMENT AGAINST TENANT AND ALL
PERSONS CLAIMING UNDER TENANT IN ANY AND ALL ACTIONS BROUGHT HEREUNDER BY
LANDLORD AGAINST TENANT TO RECOVER POSSESSION OF THE PREMISES (IN EJECTMENT OR
OTHERWISE), WITHOUT ANY LIABILITY ON THE PART OF SAID ATTORNEY, FOR WHICH THIS
LEASE SHALL BE SUFFICIENT WARRANT, AND TENANT AGREES THAT UPON THE ENTRY OF SUCH
JUDGMENT FOR POSSESSION A WRIT OF POSSESSION OR OTHER APPROPRIATE PROCESS MAY
ISSUE FORTHWITH (WITHOUT ANY PRIOR WRIT OR PROCEEDING WHATSOEVER).

         IN ANY SUCH ACTION, LANDLORD SHALL FIRST CAUSE TO BE FILED IN SUCH
ACTION AN AFFIDAVIT MADE BY LANDLORD OR SOMEONE ACTING FOR IT SETTING FORTH
FACTS NECESSARY TO AUTHORIZE THE ENTRY OF JUDGMENT, OF WHICH FACTS SUCH
AFFIDAVIT SHALL BE CONCLUSIVE EVIDENCE, AND IF A TRUE COPY OF THIS LEASE BE
FILED IN SUCH ACTION (AND OF THE TRUTH OF THE COPY SUCH AFFIDAVIT SHALL BE
SUFFICIENT EVIDENCE), IT SHALL NOT BE NECESSARY TO FILE THE


                                        5
<PAGE>   6
         ORIGINAL AS A WARRANT OF ATTORNEY, ANY RULE OF COURT, CUSTOM OR
         PRACTICE TO THE CONTRARY NOTWITHSTANDING. TENANT AND ALL PERSONS
         CLAIMING UNDER TENANT HEREBY RELEASE LANDLORD FROM ANY CLAIMS ARISING
         FROM ANY ERRORS OR DEFECTS WHATSOEVER IN ENTERING SUCH ACTION OR
         JUDGMENT, IN CAUSING SUCH WRIT OF POSSESSION OR OTHER PROCESS TO BE
         ISSUED OR IN ANY PROCEEDING THEREON OR CONCERNING THE SAME, AND HEREBY
         AGREE THAT NO WRIT OF ERROR OR OBJECTION SHALL BE MADE OR TAKEN
         THERETO.

                  THIS WARRANT OF ATTORNEY SHALL NOT BE EXHAUSTED BY ONE
         EXERCISE THEREOF, BUT JUDGMENT MAY BE CONFESSED FROM TIME TO TIME AS
         OFTEN AS OCCASION THEREFORE SHALL EXIST. SUCH POWERS MAY BE EXERCISED
         DURING AS WELL AS AFTER THE EXPIRATION OR TERMINATION OF THE TERM AND
         DURING AND AT ANY TIME AFTER ANY EXTENSION OR RENEWAL OF THE TERM OF
         THIS LEASE.

         (c) THIS PARAGRAPH 25(i) SETS FORTH WARRANTS OF ATTORNEY FOR AN
         ATTORNEY TO CONFESS JUDGMENT AGAINST TENANT. IN GRANTING THESE WARRANTS
         OF ATTORNEY TO CONFESS JUDGMENT AGAINST TENANT, TENANT, FOLLOWING
         CONSULTATION WITH (OR DECISION NOT TO CONSULT WITH) SEPARATE COUNSEL
         FOR TENANT AND WITH KNOWLEDGE OF THE LEGAL EFFECT HEREOF, HEREBY
         KNOWINGLY, INTELLIGENTLY AND VOLUNTARILY WAIVES UNCONDITIONALLY ANY AND
         ALL RIGHTS TENANT HAS OR MAY HAVE TO PRE-JUDGMENT AND PRE-EXECUTION
         NOTICE AND AN OPPORTUNITY FOR HEARING UNDER THE RESPECTIVE
         CONSTITUTIONS AND LAWS OF THE UNITED STATES OF AMERICA, THE
         COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE.

         TENANT SPECIFICALLY ACKNOWLEDGES THAT LANDLORD HAS RELIED ON THE
         WARRANTS OF ATTORNEY SET FORTH IN THIS PARAGRAPH 25(i) IN ENTERING INTO
         THIS LEASE WITH TENANT AND THAT THE LANDLORD-TENANT RELATIONSHIP
         CREATED HEREBY IS COMMERCIAL IN NATURE.

         (d) Landlord hereby agrees that so long as Philadelphia Consolidated
         Holding Corp., its parent, affiliate or subsidiary, is Tenant under
         this Lease, Landlord will not exercise the remedy under this paragraph
         25(i)."

         6. Americans with Disabilities Act. In each case where the Lease
requires Tenant to comply with all laws, statutes, ordinances, regulations,
orders and requirements of all governmental authorities having jurisdiction over
the Premises (or imposes a similar requirement), such requirement shall be
deemed to include, without limitation, the Americans


                                        6

<PAGE>   7
         with Disabilities Act, 42 U.S.C. Section 1201 et seq., as amended, and
         any rules, regulations requirements and directives thereunder
         (collectively, the "ADA"). In particular, Tenant shall perform any
         alterations, additions or improvements pursuant to the Lease in
         compliance with the ADA.

                  7. Restatement of Address for Notices to Landlord. The address
         for notices to Landlord under the Lease, as set forth in Article 31 of
         the Lease, is hereby amended and restated in its entirety as follows:

                     "To Landlord:          Bala Plaza, Inc.
                                            c/o GSIC Realty Corporation
                                            255 Shoreline Drive
                                            Suite 600
                                            Redwood City, CA 94065
                                            Attention: Bala Plaza Asset Manager

                     with a copy to:        Premisys Real Estate Services, Inc.
                                            One Bala Plaza
                                            Suite 501
                                            Bala Cynwyd, PA 19004
                                            Attention: Property Manager

                     and a copy to:         Tower Realty Management Corporation
                                            120 Gibraltar Road - Suite 210
                                            Horsham, PA 19044
                                            Attention: General Manager"

                  8. Brokers. Tenant represents and warrants that Tenant has not
         dealt with any broker, agent, finder or other person in connection with
         the negotiation for or the obtaining of this Amendment, and that no
         broker, agent, finder or other person brought about the transaction
         contemplated by this Lease, other than Premisys Real Estate Services,
         Inc. and EBI Commercial. Tenant shall indemnify, defend and hold
         Landlord harmless from and against any and all claims, lawsuits,
         liabilities, damages and costs, including attorneys' fees, incurred by
         Landlord by reason of any breach of the foregoing warranty. Landlord
         shall pay Premisys Real Estate Services, Inc. and EBI Commercial their
         respective commissions earned in connection with this Amendment
         pursuant to separate agreements. Landlord shall indemnify, defend and
         hold Tenant harmless from any claim of any other broker, agent, finder
         or other person with whom Landlord may have dealt in connection with
         this Amendment.

                  9. Ratification of Lease. Except as specifically modified by
         this Amendment, all of the provisions of the Lease are hereby ratified
         and confirmed to be in full force and effect, and shall remain in full
         force and effect, including, without limitation, all remedies reserved
         to


                                        7
<PAGE>   8
         Landlord, with which remedies Tenant hereby acknowledges complete
         familiarity, and which remedies are incorporated herein by reference as
         though set forth in their entirety.

                  10. Binding Effect. This Amendment shall be binding upon, and
         shall inure to the benefit of Landlord and Tenant and their respective
         permitted successors and assigns.

                  11. Governing Law. This Amendment shall be governed by and
         construed in accordance with the laws of the Commonwealth of
         Pennsylvania.

                  IN WITNESS WHEREOF, Landlord and Tenant have caused this
         Amendment to be executed by their respective duly authorized officers
         as of the day and year first above written.

                                           BALA PLAZA, INC.

                                           By: /s/ Joe Grubb
                                               ---------------------------
                                               Name: Joe Grubb
                                               Its: Authorized Signatory

         (Corporate Seal)                  Attest: /s/ Peter Stufall
                                                  ------------------------
                                               Name:
                                               Its: Authorized Signatory


                                           PHILADELPHIA CONSOLIDATED HOLDING
                                             CORP.

                                           By: /s/ James J. Maguire
                                               -----------------------
                                               Name:
                                               Title:


         (Corporate Seal)                  Attest: /s/ Betty Ann Angelastro
                                                   ------------------------
                                                   Name:
                                                   Title:


                                        8
<PAGE>   9
                                  EXHIBIT "A"


ONE BALA PLAZA                                                 DEMISED AREA PLAN
                                                                     FIRST FLOOR


[GRAPHIC OF FLOORPLAN]


KEY                                                                 May 17, 1996

NON-RENTABLE AREA
AREA NOT INCLUDED IN CALCULATIONS
RIGHT OF FIRST OFFER
BUILDING/PROJECT COMMON AREA
FLOOR COMMON AREA
RIGHT OF SECOND OFFER
TENANT PREMISES USEABLE AREA
FLEXIBLE USEABLE AREA
RIGHT OF FIRST REFUSAL



[SPACE DESIGN INCORPORATED LOGO]
ARCHITECTS
PLANNERS
INTERIOR DESIGNERS

210 West Washington Square
Philadelphia, Pennsylvania 19106 9711
215 592 7070 Fax 215 592 9527