CAPITAL LEASE AGREEMENT

         THIS CAPITAL  LEASE  AGREEMENT  ("Lease") is made as of the 21st day of
December,  1996, by and between ROYAL GRIP, INC., a Nevada  corporation,  having
its  principal  executive  offices  at 444 West  Geneva,  Tempe,  Arizona  85282
("Lessor"),  and ACUSHNET  RUBBER COMPANY,  INC., a  Massachusetts  corporation,
having its principal  executive offices at 744 Belleville  Avenue,  New Bedford,
Massachusetts 02742-6912 ("Lessee").

                                    RECITALS

         A. The parties desire that Lessor lease to Lessee  certain  specialized
manufacturing  equipment (the "Units" and,  individually,  a "Unit") used in the
production of non-cord golf grips ("Grips").

         B.  Lessee is  willing  to lease the Units  from  Lessor  and Lessor is
willing to lease the Units to Lessee upon the terms and  conditions  hereinafter
set forth.

         C. As of the date hereof,  Lessor and Lessee are also  entering  into a
manufacturing and sales agreement (the "MSA Agreement") pursuant to which Lessee
will become the  exclusive  supplier of Grips to Lessor and it is intended  will
become the exclusive supplier of cord grips..

         D. This Agreement and the MSA Agreement have been  negotiated by Lessor
and Lessee at arm's  length and in good faith for the purpose of  achieving  the
parties' commercial expectations.

         NOW, THEREFORE, in consideration of the covenants and mutual agreements
set  forth  herein  and in  the  MSA  Agreement  and  other  good  and  valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
in reliance  upon the  representations  and  warranties  contained  herein,  the
parties agree as follows:

                                    ARTICLE I
                      PROCUREMENT, DELIVERY, AND ACCEPTANCE

1.1 Business of Lessor and Lessee;  MSA Agreement.  Lessor is in the business of
selling and manufacturing  Grips.  Lessee manufactures  rubber-based  materials.
Lessor and Lessee have entered into that certain MSA Agreement,  whereby Lessor,
among other things, agrees that, following a transition period, it will purchase
from Lessee, during the term of the MSA Agreement, one hundred percent (100%) of
Lessee's total production of Grips as the exclusive provider of Grips to Lessor,
and  Lessee  agrees to sell to Lessor one  hundred  percent  (100%) of  Lessee's
production of Grips.  In order to produce the Grips  required by Lessor,  Lessee
will acquire the Units,  which Lessor is willing to provide subject to the terms
of this Lease.
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1.2 Shipment of  Equipment.  Lessor  hereby  grants to Lessee access to Lessor's
current manufacturing  facility located at 444 West Geneva, Tempe, Arizona 85282
(the  "Facility")  to allow Lessee,  at its expense,  to  disassemble  the Units
currently located at the Facility and to prepare them for shipment. Lessor shall
ship all such Units to Lessee F.O.B.  for delivery to the dock at Lessee's plant
(the  "Plant").  In addition,  Lessee shall cause all Units which are  currently
subject to  purchase  agreements  between  Lessor and the  manufacturer  of such
Unit(s) to be  delivered  F.O.B.  the dock at the Plant.  Lessee  shall,  at its
expense, install and set up all Units at the Plant.

1.3 Additional Deliveries. Contemporaneously herewith, Lessee shall, at its sole
expense,  deliver  to Lessor  the  following  documents,  in form and  substance
satisfactory to Lessor:

         (a)      UCC financing statements executed by Lessee; and

         (b)      any other  documents  specified in the Appendix and such other
                  documents as Lessor may reasonably request.

                                   ARTICLE II
                             TERM, RENT, AND PAYMENT

2.1 Term.  The term of this Lease as to each Unit shall  commence  upon the date
hereof and continue as specified in the Appendix.

2.2 Rent.  Lessee  shall pay to Lessor  rent for each Unit in the amounts and at
the times set forth in the Appendix.

2.3 Payment of Rent. Rent and all other sums due Lessor  hereunder shall be paid
at the office of Lessor set forth above.

2.4 Abatement; No Termination Upon Certain Events. This Lease is a net lease and
Lessee shall not be entitled to any abatement or reduction of rent or any setoff
against rent,  whether arising by reason of any past, present or future claim of
any nature by Lessee against Lessor or otherwise.  Except as otherwise expressly
provided  herein,  this Lease shall not terminate,  nor shall the obligations of
Lessor or Lessee be  otherwise  affected by reason of (a) any defect in,  damage
to, loss of possession or use or destruction of any Unit,  however  caused,  (b)
the  attachment of any lien,  encumbrance,  security  interest or other right or
claim of any third party to any Unit, except when such third party is a creditor
of  Lessor  attempting  to  collect  a debt or  obligation  of  Lessor,  (c) any
prohibition or restriction of or  interference  with Lessee's use of any Unit by
any person or entity,  except when such person or entity is a creditor of Lessor
attempting to collect a debt or  obligation of Lessor,  (d) (except as otherwise
provided  herein) the insolvency of or the  commencement by or against Lessee of
any bankruptcy,  reorganization or similar  proceeding,  or (e) any other cause,
whether similar or dissimilar to the foregoing, any present or future law to the
contrary  notwithstanding.  Except  as  otherwise  provided  herein,  it is  the
intention of the
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parties that all rent and other  amounts  payable by Lessee  hereunder  shall be
payable  in all events in the manner  and at the times  herein  provided  unless
Lessee's  obligations in respect  thereof have been  terminated  pursuant to the
express provisions of this Lease.

2.5 Order of Payments.  Payments  shall be applied in the following  order:  (a)
expenses, including attorneys' fees; (b) interest on late payments; and (c) rent
and all other sums due thereunder.


                                   ARTICLE III
                             NO WARRANTIES BY LESSOR

3.1 Acknowledgment by Lessee.  LESSEE ACKNOWLEDGES AND AGREES THAT (a) LESSEE IS
SATISFIED  THAT EACH UNIT IS  SUITABLE  FOR ITS  PURPOSES;  (b)  LESSOR IS NOT A
MANUFACTURER  THEREOF  NOR A DEALER IN  PROPERTY  OF SUCH  KIND;  (c)  EXCEPT AS
OTHERWISE  PROVIDED  HEREIN LESSOR HAS NOT MADE,  AND DOES NOT HEREBY MAKE,  ANY
REPRESENTATION,  WARRANTY  OR  COVENANT  EXPRESS  OR  IMPLIED  AS TO ANY  MATTER
INCLUDING, WITHOUT LIMITATION, THE TITLE,  MERCHANTABILITY,  CONDITION, QUALITY,
DESCRIP TION, DURABILITY,  FITNESS FOR PURPOSE OR SUITABILITY OF ANY UNIT IN ANY
RESPECT OR IN CONNECTION WITH OR FOR THE PURPOSES AND USES OF LESSEE; (d) LESSOR
SHALL NOT BE REQUIRED TO PROVIDE ANY  MECHANICAL  SERVICES TO LESSEE  INCLUDING,
WITHOUT LIMITATION, ANY MAINTENANCE, REPAIR, SHIPPING OR INSPECTIONS; AND (e) AS
AGAINST LESSOR, ALL UNITS SHALL BE ACCEPTED IN "AS IS" CONDITION.

3.2  Assignment of Warranties.  Lessor hereby  assigns to Lessee,  to the extent
assignable, any warranties, covenants and representations of Vendor with respect
to any Unit,  but any  action  taken by Lessee  by  reason  thereof  shall be at
Lessee's expense and shall be consistent with Lessee's obligations under Article
II.

                                   ARTICLE IV
                        POSSESSION, USE, AND MAINTENANCE

4.1 Possession and Use. Lessee shall not (i) use, operate, maintain or store any
Unit improperly,  carelessly or in violation of any applicable law or regulation
of any  governmental  authority  or  the  manufacturer's  recommended  operating
procedures,  standards and warranty  requirements,  (ii) abandon any Unit, (iii)
sublease  any Unit or permit its use by anyone  other than  Lessee  without  the
prior written consent of Lessor,  not to be unreasonably  withheld,  (iv) permit
any Unit to be removed  from the state  specified  in the  Schedule  without the
prior written consent of Lessor,  (v) sell,  assign or transfer,  or directly or
indirectly create,  incur or suffer to exist any lien, claim,  security interest
or encumbrance of any kind on any of its rights hereunder or in any Unit.
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4.2  Maintenance.  Lessee  shall at its expense at all times  during the term of
this Lease maintain the Units in good  operating  order,  repair,  condition and
appearance and in accordance  with the  manufacturer's  recommended  procedures,
operating standards and warranty requirements.

4.3  Alterations.  Lessee  may alter  any Unit or affix or place any  accessory,
equipment  or device on any Unit.  If an Event of Default  has  occurred  and is
continuing,  and any Units are recovered  and/or  delivered to Lessor by Lessee,
all parts accessories,  equipment or deliveries  attached to such Units shall be
deemed the property of Lessor.

4.4 Inspection by Lessor. Upon prior notice to Lessee,  Lessor and its designees
shall have the right at all  reasonable  times to inspect any Unit,  observe its
use and inspect records related thereto.

                                    ARTICLE V
                              GENERAL TAX INDEMNITY

5.1 Impositions. Lessee shall pay or reimburse Lessor for, and indemnify, defend
and hold Lessor  harmless for,  from, and against all fees  (including,  but not
limited to, license,  documentation,  recording or registration  fees),  and all
sales,  use,  privilege,  excise,  property,  or other taxes,  levies,  imposts,
duties, assessments,  charges or withholdings of any nature whatsoever, together
with any penalties,  fines or additions to tax, or interest  thereon (all of the
foregoing being  hereafter  referred to as  "Impositions"),  arising at any time
before or during the term of this Lease,  or upon any  termination of this Lease
or return of the Units to Lessor,  and levied or imposed on Lessor,  directly or
otherwise,  by any federal, state or local government or taxing authority in the
United  States or by any  foreign  country or foreign  or  international  taxing
authority on or with respect to (a) any Unit, (b) the exportation,  importation,
registration,   purchase,   ownership,   delivery,  leasing,   possession,  use,
operation, storage, maintenance, repair, transportation,  return, sale, transfer
of title or other  disposition  thereof,  (c) the rents,  receipts,  or earnings
arising  from  any  Unit,  or (d)  this  Lease or any  payment  made  hereunder,
excluding,  however,  taxes measured by Lessor's net income imposed or levied by
the United  States or any state  thereof but not  excluding  any such net income
taxes  that by the terms of the  statute  imposing  such tax  expressly  relieve
Lessee from the payment of any  Impositions  Lessee  would  otherwise  have been
obligated to pay, reimburse or indemnify.

5.2 Payment of Impositions by Lessor.  Lessor shall pay directly all Impositions
for which  Lessor is primarily  responsible  and as to which Lessor gives Lessee
notice that Lessor will pay directly; and Lessee shall promptly reimburse Lessor
for such  Impositions so paid (except any  Impositions  excluded by Section 5.1)
upon presentation of a bill therefor.

5.3 Payment of Impositions by Lessee.  Lessee shall pay on or before the time or
times   prescribed  by  law  any  Impositions  for  which  Lessee  is  primarily
responsible  under  applicable  law  and  any  other  Impositions   (except  any
Impositions  excluded by Section 5.1) not payable by Lessor  pursuant to Section
5.2, but Lessee shall have no obligation to pay any such Imposition while
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<PAGE>
Lessee is  contesting  such  Imposition in good faith and by  appropriate  legal
proceedings  and the  nonpayment  thereof  does not,  in the  opinion of Lessor,
adversely affect the title, property, use, disposition or other rights of Lessor
with respect to the Units or result in any enforcement,  collection, foreclosure
or forfeiture  proceeding or any levy or execution which remains  unstayed for a
period of fifteen (15) days.  Lessee shall furnish on Lessor's  request proof of
payment of any Imposition paid by Lessee.

5.4 Tax Returns.  Lessor shall prepare and file all required  personal  property
tax reports or returns as "Owner" of the Units but Lessee  must  timely  provide
Lessor with all information  available to Lessee that Lessor requires to prepare
properly any such report or return.  Lessee shall report the Units as "Equipment
Leased from Others" on any property tax reports or returns  required to be filed
by Lessee. Lessee shall furnish on Lessor's request copies of reports or returns
so filed.

5.5 Certain Economic Benefits.  Lessor acknowledges that Lessee has the right to
claim certain economic benefits  available to it under the Internal Revenue Code
of 1986,  as amended from time to time (the  "Code"),  and/or  under  equivalent
state  income tax laws,  based upon  depreciable  lives of the Units,  averaging
conventions, methods of depreciation and other such methods as Lessee elects for
income tax purposes (the "MACRS Deductions").

5.6 No Indemnification.  Notwithstanding  what may otherwise be provided herein,
the indemnifications  described in this Section 5 shall not be applicable to the
extent  of the  gross  negligence  or  intentional  misconduct  of  Lessor,  its
employees, agents, representatives or assigns.


                                   ARTICLE VI
                       RISK OF LOSS; WAIVER AND INDEMNITY

6.1  Casualty  Occurrence.  If any  Unit  is worn  out,  stolen,  destroyed,  or
irreparably  damaged,  from any cause  whatsoever,  or taken or requisitioned by
condemnation  or  otherwise  (any such  occurrence  being  hereinafter  called a
"Casualty  Occurrence") before or during the term of this Lease as to such Unit,
Lessee shall give Lessor prompt notice  thereof.  On the first rent payment date
after the Casualty  Occurrence or, if there is no such rent payment date, thirty
(30) days after the  Casualty  Occurrence,  Lessee shall pay to Lessor an amount
equal to the rent payment in respect of such Unit, if any, due on such date plus
a sum equal to the corresponding  Ending Financed Balance described on Exhibit A
(the  "Casualty  Value") for all of the Units as of such date. In the event of a
Casualty  Occurrence,  the Casualty  Occurrence shall be deemed to have affected
all of the Units.

         Upon the making of such payment by Lessee in respect of the Units,  the
Rent for the Units  shall  cease to accrue and this Lease  shall  terminate.  If
Lessor  receives the Casualty  Value for the Units,  Lessee shall be entitled to
the  proceeds  of any  recovery  in respect of the  Unit(s)  from  insurance  or
otherwise.
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<PAGE>
6.2  Indemnification.  With  respect  to a Unit,  so long as such Unit is in the
possession  of and/or  under the  control of Lessee,  Lessee  hereby  waives and
releases  any  claim now or  hereafter  existing  against  Lessor,  any  company
controlled by, controlling, or under common control with Lessor and all of their
directors, officers, employees, agents, attorneys, successors and assigns (each,
an "Indemnified Person") on account of, and shall indemnify,  reimburse and hold
each  Indemnified  Person  harmless  for,  from,  and against any and all claims
(including,  but not limited  to,  claims  based on or  relating  to  copyright,
trademark or patent infringement,  environmental liability,  negligence,  strict
liability in tort, statutory liability or violation of laws),  losses,  damages,
obligations,  penalties,  liabilities,  demands,  suits,  judgments or causes of
action,  and all legal  proceedings,  and any  reasonable  costs or  expenses in
connection therewith, including reasonable attorneys' fees, including reasonable
allocated time charges of internal counsel, in each case imposed on, incurred by
or asserted against the Indemnified  Person in any way relating to or arising in
any manner out of (a) the registration,  purchase,  or the ownership,  delivery,
condition,  lease,  assignment,   storage,   transportation,   possession,  use,
operation, return, repossession,  sale or other disposition of, any Unit, before
or during  the term of this  Lease as to the  Unit;  (b) any  alleged  or actual
defect in any Unit  (whether  arising  from the  material  or any  article  used
therein, the design,  testing,  use, maintenance,  service,  repair, or overhaul
thereof or  otherwise),  regardless of when such defect is discovered or alleged
and no matter where it is located; or (c) any violation of any applicable local,
state or federal environmental law or regulation.

                                   ARTICLE VII
                                    INSURANCE

7.1 Insurance. Lessee shall maintain insurance in accordance with Section 6.6 of
the MSA Agreement.

                                  ARTICLE VIII
                                    COVENANTS

8.1  Financial  Information.  Lessor and Lessee agree to provide each other with
the following information:

         (a) As soon as available but in any event within  forty-five  (45) days
after the end of each of the first three calendar  quarters in each fiscal year,
unaudited consolidated financial statements,  including statements of operations
and cash flows for such  quarter  and for the period from the  beginning  of the
fiscal year to the end of such quarter and balance  sheets as of the end of such
quarter,  setting forth in each case comparisons to the corresponding  period in
the  preceding  fiscal  year,  and  all  such  statements  will be  prepared  in
accordance with generally accepted accounting principles,  consistently applied,
subject to normal year-end audit adjustments and excluding footnote disclosures;
                                      - 6 -
<PAGE>
         (b) As soon as available but in any event within ninety (90) days after
the  end  of  each  fiscal  year,  audited  consolidated  financial  statements,
including  statements  of  operations  and cash flows for such  fiscal  year and
balance  sheets as of the end of such fiscal  year,  setting  forth in each case
comparisons to the  corresponding  period in the preceding  fiscal year, and all
such  statements  will  be  prepared  in  accordance  with  generally   accepted
accounting principles, consistently applied.

         (c)  With  reasonable  promptness,  such  other  information  and  data
concerning such party as the other party may reasonably request.

                                   ARTICLE IX
                  REPRESENTATIONS AND WARRANTIES OF THE PARTIES

         As of the date hereof,  each party represents and warrants to the other
party the following:

9.1 Organization and  Qualification.  The party is a corporation duly organized,
validly  existing,  and  in  good  standing  under  the  laws  of its  state  of
incorporation,  and has the requisite  corporate  power and authority to own and
operate its  properties  and to carry on its business as now  conducted in every
jurisdiction  where the failure to do so would have a material adverse effect on
its business, properties, or ability to conduct the business currently conducted
by it.

9.2 Authority Relative to this Agreement.  The party has the requisite power and
authority  to  enter  into  this  Agreement  and to  carry  out its  obligations
hereunder.  The execution  and delivery of this  Agreement by such party and the
consummation  by such party of the  transactions  contemplated  hereby have been
duly authorized by such party, and no other corporate proceedings on the part of
such party are necessary to authorize this Agreement and such transactions. This
Agreement has been duly  executed and delivered by such party and  constitutes a
valid and binding  obligation of such party,  enforceable in accordance with its
terms,  except as the  enforceability  thereof  may be  limited  by  bankruptcy,
insolvency, reorganization, or other similar laws relating to the enforcement of
creditors' rights generally and by general principles of equity.

9.3 No Conflicts. The party is not subject to, or obligated under, any provision
of (i) its Certificate of Incorporation or Bylaws,  (ii) any material agreement,
arrangement, or understanding, (iii) any material license, franchise, or permit,
or (iv) any law, regulation, order, judgment, or decree, which would be breached
or violated, or in respect of which a right of termination or acceleration would
arise,  or  pursuant  to  which  any  encumbrance  on  any  of its or any of its
subsidiaries' material assets would be created, by its execution,  delivery, and
performance of this  Agreement and the  consummation  by it of the  transactions
contemplated hereby.

9.4 No Consents. No authorization,  consent, or approval of, or filing with, any
public body,  court,  or authority is necessary on the part of the party for the
consummation by such party of the transactions contemplated by this Agreement.
                                      - 7 -
<PAGE>
9.5 Financial  Statements.  The party has provided to the other party  unaudited
financial  statements  for and as of the period ended  September  30, 1996,  and
audited  financial  statements for and as of the period ended December 31, 1995,
all of  which  financial  statements  have  been  prepared  in  accordance  with
generally  accepted   accounting   principles  applied  on  a  consistent  basis
throughout  the periods  involved and fairly  present the financial  position of
such party as of the dates  thereof and the results of its  operations  and cash
flows for the periods  then ended,  subject in the case of  unaudited  financial
statements to normal  year-end  adjustments in the absence of complete  footnote
disclosure.

9.6 No  Litigation.  The  party is not  subject  to any  legal,  administrative,
arbitration or other suit, proceeding, claim, action, investigation,  or inquiry
pending or, to the knowledge of such party, threatened against or involving such
party  which  could have a material  adverse  effect upon its ability to perform
this  Agreement or upon its results of  operations  or financial  condition,  or
which  questions  the  validity of this  Agreement  or any action taken or to be
taken by such party  pursuant to this  Agreement  and, to the  knowledge of such
party,  there is no valid basis for any such suit,  proceeding,  claim,  action,
investigation or inquiry.

9.7 No Liens or  Encumbrances.  Lessor  warrants and represents  that Lessor has
good  and  marketable  title  to the  Units  free and  clear  of any  liens  and
encumbrances.

                                    ARTICLE X
                               DEFAULTS; REMEDIES

10.1  Events of  Default.  The  following  shall  constitute  events of  default
("Events of Default") hereunder:

         (a) Lessee  fails to make any  payment  to Lessor  within ten (10) days
after written notice thereof to Lessee.

         (b) Any representation or warranty of Lessee contained herein or in any
document  furnished to Lessor in connection  herewith is incorrect or misleading
in any material respect when made;

         (c) Lessee fails to observe or perform any other covenant, agreement or
warranty  made by Lessee  hereunder  and such failure  continues for thirty (30)
days after written notice thereof to Lessee;

         (d) Lessee  makes an  assignment  for the benefit of creditors or files
any  petition or action  under any  bankruptcy,  reorganization,  insolvency  or
moratorium  law,  or any other law or laws for the  relief of, or  relating  to,
debtors;

         (e) Any  involuntary  petition  is filed under any  bankruptcy  statute
against  Lessee,  or any  receiver,  trustee,  custodian or similar  official is
appointed to take possession of the properties
                                      - 8 -
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of Lessee, any guarantor of this Lease or any general partner of Lessee,  unless
such petition or appointment is set aside or withdrawn or ceases to be in effect
within one-hundred twenty (120) days from the date of the filing or appointment;

         (f) Lessee elects to totally liquidate its assets and/or dissolve;

         (g) Lessee  merges or  consolidates  with any other entity  except that
Lessee may merge or  consolidate  with its parent or any  subsidiary  of Lessee;
provided,  that, in each case,  immediately after giving effect to such proposed
transaction no Event of Default would exist;  and provided  further that, in the
case of a merger or consolidation with a subsidiary of Lessee, the Lessee is the
surviving corporation; or

         (h) Lessee  commits a material  breach  (which is not cured  within any
applicable grace period) under the MSA Agreement.

10.2 Lessor's Remedies.  If any Event of Default occurs,  Lessor, at its option,
without  notice to or demand upon Lessee  except as  otherwise  provided in this
Section 10.2, may:

         (a) Terminate this Lease and/or  Lessee's  rights of possession and use
of all or any portion of the Units under the Lease;

         (b)  Take  possession  of all or any  portion  of the  Units,  wherever
located, or render the same unusable;

         (c) Require the Lessee to assemble and return all or any portion of the
Units to Lessor (as more fully specified in Section 11 hereof);

         (d)  Retain,  hold,  sell,  lease or  otherwise  dispose  of all or any
portion of the Units, in a public or private transaction, without demand upon or
notice to Lessee,  and any such sale, lease or other  disposition  shall be free
and clear of any rights of Lessee;

         (e) Recover other and further  damages,  which shall include but not be
limited to payment by Lessee  immediately  upon  demand of the  following,  each
bearing  interest  until  paid in full at the  Default  Rate (as  defined in the
Appendix)  from the  earlier of (A) the date such demand is made or (B) the date
otherwise due and payable:

                  (i) all accrued and unpaid rent payments  payable under all or
         any of the  Leases  and all  other  costs,  charges,  fees and  amounts
         payable thereunder or hereunder,

                  (ii) all of Lessor's  costs and  expenses in  connection  with
         Lessee's  breach  of this  Lease,  or the  enforcement  of  this  lease
         (including reasonable attorneys' fees and expenses), or associated with
         the repossession,  reconditioning  and sale, lease or other disposition
         of  the  Units;  and  Lessor's  remedies   hereinabove   specified  are
         cumulative, and may be
                                      - 9 -
<PAGE>
         exercised  by Lessor in any order or manner,  as to the Lease and Units
         or only a portion  thereof,  all as Lessor shall  determine in its sole
         discretion.  No  exercise  of any  remedy  available  to  Lessor  shall
         constitute any election foreclosing Lessor from the subsequent exercise
         of any other remedy. In furtherance of its remedies,  Lessor may and is
         hereby  irrevocably  authorized by Lessee (and Lessee, at its sole cost
         and expense,  shall cause Lessor to be duly authorized by all necessary
         parties) to enter  without  trespass or liability  upon any premises on
         which the Units or any portion  thereof  may be  located.  In the event
         that Lessor,  at its option,  shall give Lessee  notice of any proposed
         sale or other  disposition  of the  Units or any part  thereof,  Lessee
         hereby agrees that written  notice given to Lessee in  accordance  with
         the terms of this  Lease at least ten (10) days  prior to any such sale
         or  other  disposition  shall  be  and  be  deemed  to be  commercially
         reasonable notice.

10.3  Payments  by Lessor on Behalf of Lessee.  If Lessee  fails to timely  make
(within all grace  and/or cure  periods)  any payment or to do any act  required
hereunder,  than Lessor shall have the right, but not the obligation,  to do the
act or make the  payment,  without  further  notice  to, or demand on Lessee and
without releasing Lessee from any contractual obligation,  and to pay, purchase,
contest or compromise  any  encumbrance,  charge or lien which Lessor judges (in
its reasonable  discretion) to affect the Unit or Lessor's  rights  therein.  In
exercising  such  right,  Lessor may incur any  liability  and expend any amount
which in its reasonable discretion it deems necessary. All sums Lessor so incurs
or spends shall be,  without  demand,  immediately  due and payable by Lessee to
Lessor and shall bear interest from the date so incurred or spent,  whichever is
earlier, until paid in full to Lessor at the Default Rate.

                                   ARTICLE XI
                                   BANKRUPTCY

11.1 Bankruptcy of Lessor.

         (a)  Lessor  represents,  warrants  and  covenants  that  it  does  not
presently intend to file or solicit its creditors to file on Lessor's behalf for
protection or reorganization  under the bankruptcy laws of the United States. If
there shall be filed by or against the Lessor a petition  (whether  voluntary or
involuntary) under any Chapter of the United States Bankruptcy Code (the "Code")
on or after the date  hereof,  it is the  intention of the Lessor and the Lessee
that the Lessee shall have the immediate  right, at its option,  to elect one of
the following alternatives:

                  (i) provided that Lessee has  terminated the MSA Agreement and
         this Lease,  return all of the Units to Lessor F.O.B.  at such location
         in the metropolitan area of Phoenix as directed by Lessor (in the event
         Lessor  fails or refuses to provide for a delivery  site,  Lessee shall
         have the unqualified  right to deliver the Units to a storage  facility
         and Lessor  shall be liable for any and all storage  expenses  incurred
         thereby); or
                                     - 10 -
<PAGE>
                  (ii) provided that Lessee reaffirms its obligations  under the
         MSA Agreement and this Lease,  Lessee shall have the immediate right to
         exercise the purchase  option  described in the Appendix or to continue
         the Lease.

Lessor and Lessee  acknowledge that the remedies of the Lessee set forth in this
Section 11.1 are the sole and exclusive remedies of Lessee (in lieu of all other
remedies)  arising  from the  bankruptcy  of Lessor and are  therefore  fair and
equitable.  The  purpose of this Lease (as to Lessee) is to provide  Lessee with
the  machinery  necessary to fulfill its  obligations  under the MSA  Agreement.
Lessor's  bankruptcy may result in a reduction in the volume of Grips  purchased
by Lessor and therefore the commercial  value of both the MSA Agreement and this
Lease will be materially reduced.  Lessor hereby agrees not to object to, nor to
request a trustee in bankruptcy to attempt to, petition the Bankruptcy  Court to
set aside the provisions of this Section 11.1.

11.2  Bankruptcy of Lessee.  Lessee  represents,  warrants and covenants that it
does not  presently  intend to file or solicit its creditors to file on Lessor's
behalf for protection or reorganization  under the Bankruptcy Laws of the United
States or to make any  assignment  for the benefit of creditors  under any state
laws.  If there  shall be filed by or against  the  Lessee a  petition  (whether
voluntary or  involuntary)  under any chapter of the Code,  on or after the date
hereof,  it is the intention of the Lessor and Lessee that the Lessor shall have
immediate right to terminate this Lease,  enter upon the Plant,  and disassemble
and remove the Units.  The MSA Agreement shall  thereafter be deemed  terminated
and all obligations of Lessee and Lessor hereunder shall immediately terminate.

Lessor and Lessee  acknowledge  that the rights and remedies of Lessor set forth
in this Section 11.2 are the sole and  exclusive  remedies of Lessor (in lieu of
all other remedies) arising from the bankruptcy of Lessor and are therefore fair
and  equitable.  The  purpose of this Lease (as to Lessor) is to provide  Lessor
with an acceptable  manufacturer to fulfill 100% of Lessor's needs for Grips (of
the quality  required by Lessor).  Lessee's  bankruptcy may result in a material
reduction  in the  commercial  value of both the MSA  Agreement  and this Lease.
Lessee  hereby  agrees not to object to, nor to request a trustee in  bankruptcy
to, attempt to petition the Bankruptcy Court to set aside the conditions of this
Section 11.

                                   ARTICLE XII
                                  MISCELLANEOUS

12.1  Assignment.  Lessor  may not assign or  transfer  all or any of the right,
title or  interest  of  Lessor  in and to the Units  without  the prior  written
consent of Lessee, but may assign the rights,  benefits and advantages of Lessor
under the Lease  hereunder,  including the rights to receive  payment of rent or
any  other  payment  hereunder.  No  assignment  of this  lease or any  right or
obligation hereunder may be made by Lessee or any assignee of Lessee without the
prior written consent of Lessor.
                                     - 11 -
<PAGE>
12.2  Further  Assurances.  Lessee  and  Lessor  confirm  there  is  no  pending
litigation,  tax claim,  proceeding  or dispute  that may  adversely  affect its
financial condition or impair its ability to perform its obligations  hereunder.
Lessee will, at its expense,  maintain its legal existence in good standing (and
authorized  to do business in any  applicable  state) and do any further act and
execute,  acknowledge,  deliver, file, register and record any further documents
Lessor may  reasonably  request in order to protect  Lessor's title to the Units
and Lessor's rights and benefits under this Lease.

12.3 Late Payments.  Lessee shall pay to Lessor, on demand, interest at the rate
set  forth in the  Appendix  on the  amount  of any  payment  not made  when due
hereunder from the date due until payment is made.

12.4 Effect of Waiver.  No delay or omission  to  exercise  any right,  power or
remedy  accruing to Lessor upon any breach or default of Lessee  hereunder shall
impair any such right,  power or remedy nor shall it be construed to be a waiver
of any such  breach  or  default,  or an  acquiescence  therein  or of or in any
similar  breach or  default  thereafter  occurring,  nor shall any waiver of any
single  breach or  default  be deemed a waiver  of any other  breach or  default
theretofore or thereafter occurring.  Any waiver, permit, consent or approval of
any kind or character on the part of Lessor of any breach or default  under this
Lease must be in writing specifically set forth.

12.5 Survival of Covenants. All obligations of Lessee and Lessor (as applicable)
under  Articles 1, 2, 4, 5, 6, 7, 8, 11 and 12.1 and the Appendix  shall survive
the  expiration or  termination  of this Lease to the extent  required for their
full observance and performance.

12.6  Governing  Law. This  Agreement  shall be governed by and  interpreted  in
accordance  with the laws of the state of  Massachusetts  (excluding its, or any
other jurisdiction's, choice of law principles).

12.7  Severability.  Should  any  part of any  provision  of this  Lease be held
invalid or unenforceable,  the invalid or unenforceable  part or provision shall
be replaced with a provision which  accomplishes,  to the extent  possible,  the
original  business  purpose and  economic  intent of such part or provision in a
valid and  enforceable  manner,  and the  remainder  of this Lease shall  remain
binding upon the parties hereto.

12.8  Financial  Information.  Lessee  shall  keep  its  books  and  records  in
accordance  with  generally   accepted   accounting   principles  and  practices
consistently  applied and shall deliver to Lessor such financial  statements and
information as Lessor may reasonably  request.  Credit  information  relating to
Lessee may be  disseminated  among Lessor and any of its  affiliates  and any of
their respective successors and assigns.
                                     - 12 -
<PAGE>
12.9 Notices.

         (a) All  notices  and  demands  of any kind which  either  party may be
required  or desire to serve upon the other  under the terms of this Lease shall
be in writing and shall be sent by registered mail, return receipt requested, or
by facsimile with  confirming  copy by registered mail to the receiving party at
the address of the receiving party set forth below:

                  If to Lessor:         Royal Grip, Inc.
                                        444 W. Geneva
                                        Tempe, Arizona 85282
                                        Phone: (602) 829-9000
                                        Fax: (602) 829-9100
                                        Attn: President

                  If to Lessee:         Acushnet Rubber Company, Inc.
                                        744 Belleville Avenue
                                        New Bedford, Massachusetts 02742-6916
                                        Phone: (508) 998-4004
                                        Fax: (508) 998-4102
                                        Attn: Chief Operating Officer

         (b) Either party may change such  address  upon  written  notice to the
other party hereto in the manner set forth in this Section 12.9.  All notices or
demands  shall be deemed to have been given when  received  by the party to whom
such  notice  is  sent  as  evidenced  by  a  receipt  signed  and  dated  by  a
representative of the receiving party.

12.10 Dispute Resolution. Any dispute among the parties hereto shall be resolved
in accordance  with the dispute  resolution  procedures  attached  hereto in the
Appendix ; provided,  that, nothing herein shall preclude any party from seeking
or obtaining  equitable  relief,  such as an  injunction,  or from enforcing any
order or judgement of an arbitrator through judicial process.

12.11  Counterparts.  Two  counterparts  of this Lease have been executed by the
parties hereto. One counterpart has been prominently marked "Lessor's Copy". One
counterpart has been prominently  marked  "Lessee's Copy".  Only the counterpart
marked "Lessor's Copy" shall evidence a monetary obligation of Lessee.

12.12  Transaction  Costs.  If the negotiation or drafting of lease documents is
required,  the Lessee shall be responsible  for its own legal costs and expenses
and Lessor shall be responsible for its own legal costs.

12.13  Audits.  Lessee  will allow  Lessor  and its  agents to inspect  Lessee's
records  regarding  the  Units  and make  copies  of books  and  records  at any
reasonable time and upon reasonable notice.
                                     - 13 -
<PAGE>
12.14 Effect and  Modification of Lease.  This Lease  exclusively and completely
states the rights of Lessor and Lessee with  respect to the leasing of the Units
and supersedes all prior agreements,  oral or written,  with respect thereto. No
variation or modification of this Lease shall be valid unless in writing.

                  IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this
Agreement to be executed by their duly  authorized  representatives  on the date
and year first written above.


ROYAL GRIP, INC., a Nevada corporation  ACUSHNET RUBBER COMPANY, INC., a       
                                        Massachusetts corporation              
                                                                               
                                                                               
By: /s/ Robert G.J. Burg, II            By: /s/ Ronald V. Fernandes
   -----------------------------------     ----------------------------------- 
Name:      Robert G.J. Burg, II         Name:      Ronald V. Fernandes         
Title:     President                    Title:     Executive Vice President and
                                                   Chief Operating Officer     
                                     - 14 -
<PAGE>
                  APPENDIX to LEASE  AGREEMENT  dated as of December  21,  1996,
between Royal Grip, Inc. and Acushnet Rubber Company, Inc..


         Units.
         ------

         The  Unit(s)  to  be  leased  hereunder  consist(s)  of  used  and  new
fabrication  machines and related equipment for the manufacture of Grips as more
particularly  described  in Schedule 1 attached  hereto and made part hereof and
all  modifications,  replacements  and  substitutions.  Some  of the  Units  are
currently  under the  possession and control of Lessor and some of the Units are
subject  to  purchase  orders  between  Lessor and the  respective  manufacturer
thereof.


         Fair Market Value
         -----------------

         "Fair Market Value" with respect to the Units means the Ending Financed
Balance set forth on Exhibit "A".

         Term.
         -----

         The term of this  Lease  shall  begin on the date  hereof  and,  unless
sooner  terminated,  shall end on December 31, 2006,  at which time Lessor shall
deliver to Lessee and Lessee  shall accept from Lessor a Bill of Sale for all of
the Units.

         Location.
         ---------

         The  Units  shall be  located  in the  state of  Massachusetts  and the
Schedule  relating  to each Unit shall set forth the  state,  county and city in
which such Unit is to be principally located. Lessee shall give Lessor notice of
any  change in the  location  within the state no later than ten (10) days after
such change.

         Rent.
         -----

         Lessee  shall pay to Lessor  rent for the Units in the total  amount of
$4,508,384.56  comprised of $3,122,000 (the Fair Market Value of the Units as of
the date hereof  plus fifty  percent  (50%) of the  rigging  and  freight  costs
incurred by Lessor for the F.O.B. delivery described in Section 1.2 hereof) plus
$1,386,384.56 (which equals the fair market value of the units times 7.8125% per
annum over 10 years) payable in 120 consecutive monthly  installments,  with the
first such  installment  due on the first day of the first month  following  the
date hereof,  each Rent  installment to be (subject to adjustment as provided in
the Lease) $37,569.87.
                                       -1-
<PAGE>
         Default Rate.
         -------------

                  Lessee shall pay Lessor  interest on late payments at the rate
of twelve percent (12%) per annum.

         Reimbursement for Shipping Costs.
         ---------------------------------

                  The Rent due to Lessor  hereunder  shall be in addition to the
credits  against  the  shipping  costs  described  in  Section  3.4 of  the  MSA
Agreement.

         Purchase Option.
         ----------------

                  If no Event of Default  exists,  Lessee may at any time during
the term of this Lease, by written notice delivered to Lessor, elect to purchase
all (but not less  than all) of the Units for a  purchase  price  (the  "Capital
Lease Option  Balance")  equal to  corresponding  "End of Month Payoff  Balance"
described in the  attached  Exhibit A. The option to purchase  described  herein
shall be completed  as of the last day of the  immediately  succeeding  calendar
month at which time Lessor shall deliver to Lessee a bill of sale for all of the
Units together with a UCC-2 Termination Statement.

         Security Deposit.
         -----------------

                  Lessee shall deposit with Lessor, as security $ -0-.
                                       -2-
<PAGE>
Dispute Resolution Procedures.
------------------------------

         All claims,  disputes and other matters in  controversy  (herein called
"dispute")  arising  directly or indirectly out of or related to this Lease,  or
the breach thereof,  whether  contractual or noncontractual,  and whether during
the  term  or  after  the  termination  of this  Agreement,  shall  be  resolved
exclusively according to the procedures set forth in this Appendix.

         A. Negotation. The parties shall attempt to settle disputes arising out
of or  relating  to  this  Lease  or the  breach  thereof  by a  meeting  of two
designated representatives of each party within five (5) days after a request by
either of the parties to the other party asking for the same.

         B. Mediation. If such dispute cannot be settled at such meeting, either
party,  within  five  (5) days of such  meeting  may give a  written  notice  (a
"Dispute  Notice") to the other party  setting  forth the nature of the dispute.
The parties  shall  attempt in good faith to resolve the dispute by mediation in
Phoenix,   Arizona,  under  the  Commercial  Mediation  Rules  of  the  American
Arbitration Association ("AAA") in effect on the date of the Dispute Notice. The
parties shall select a person who will act as the mediator  under this Paragraph
B within 60 days of the date of the Lease.  If the dispute has not been resolved
by mediation as provided  above  within  thirty (30) days after  delivery of the
Dispute  Notice,  then  the  dispute  shall  be  determined  by  arbitration  in
accordance with the provisions of Paragraph C hereof.

         C.  Arbitration.  Any dispute that is not settled through  mediation as
provided in  Paragraph B above  shall be  resolved  by  arbitration  in Phoenix,
Arizona,  governed by the Federal  Arbitration  Act, 9 U.S.C.  ss. 1 et seq, and
administered by the AAA under its Commercial  Arbitration Rules in effect on the
date of the Dispute Notice,  as modified by the provisions of this Section C, by
a single arbitrator.  The arbitrator selected, in order to be eligible to serve,
shall be a lawyer  with at least 15  years  experience  specializing  in  either
general commercial  litigation or general corporate and commercial  matters.  In
the event the parties cannot agree on a mutually  acceptable  single  arbitrator
from the list  submitted by the AAA, the AAA shall  appoint the  arbitrator  who
shall  meet the  foregoing  criteria.  The  arbitrator  shall  base the award on
applicable law and judicial  precedent and, unless both parties agree otherwise,
shall  include in such award the  findings of fact and  conclusions  of law upon
which the award is based.  Judgment on the award  rendered by the  arbitrator(s)
may be entered in any court having jurisdiction  thereof.  The award may only be
made for  compensatory  damages,  and if any other damages  (whether  exemplary,
punitive,  consequential,  statutory or other) are included,  the award shall be
vacated and remanded,  or modified or corrected,  as appropriate to promote this
damage limitation.

         Notwithstanding the foregoing:

                  (a) Upon the  application  by  either  party to a court for an
order  confirming,  modifying  or vacating  the award,  the court shall have the
power to  review  whether,  as a matter  of law  based on the  findings  of fact
determined by the arbitrator, the award should be confirmed, modified or vacated
in order to  correct  any  errors  of law  made by the  arbitrator.  In order to
effectuate such judicial review limited to issues of law, the parties agree (and
shall stipulate to the
                                       -3-
<PAGE>
court)  that the  findings  of fact  made by the  arbitrator  shall be final and
binding  on the  parties  and shall  serve as the facts to be  submitted  to and
relied on by the court in  determining  the extent to which the award  should be
confirmed, modified or vacated.

                  (b)  Either  party  shall have the right to apply to any court
for an order to enforce  any of the  ownership  and  confidentiality  provisions
contained in the Agreement.

         D. Costs and  Attorneys'  Fees.  If either  party fails to proceed with
mediation or arbitration as provided herein or unsuccessfully seeks to stay such
mediation or arbitration,  or fails to comply with any arbitration  award, or is
unsuccessful  in  vacating  or  modifying  the award  pursuant  to a petition or
application for judicial review, the other party shall be entitled to be awarded
costs,  including  reasonable  attorneys'  fees,  paid or incurred by such other
party in  successfully  compelling  such  arbitration  or defending  against the
attempt to stay,  vacate or modify such  arbitration  award and/or  successfully
defending or enforcing the award.

         E.  Tolling of Statute  of  Limitations.  All  applicable  statutes  of
limitations  and  defenses  based upon the passage of time shall be tolled while
the procedures  specified herein are pending. The parties will take such action,
if any, required to effectuate such tolling.



ROYAL GRIP, INC. , a Nevada             ACUSHNET RUBBER COMPANY,
corporation                             INC., a Massachusetts corporation


By: /s/ Robert G.J. Burg, II            By: /s/ Ronald V. Fernandes
   -----------------------------------     ----------------------------------- 
Name:  Robert G.J. Burg, II             Name:  Ronald V. Fernandes
Title: President                        Title: Executive Vice President and
       444 West Geneva Drive                   Chief Operating Officer
       Tempe, Arizona 85282                    744 Belleville Avenue
                                               New Bedford, MA 02742-6916
                                       -4-
<PAGE>
                                   SCHEDULE 1

        A complete description of the Units has been provided to Lessee.
                                       -5-
<PAGE>
                                    EXHIBIT A
                             Capital Lease Schedule
                             ----------------------
<TABLE>
<CAPTION>
  Amount Financed Through Capital Lease                                                   $ 3,122,000
  Finance Rate %                                                                               7.8125
  Term in Months                                                                                  120
  Payment due date                                                                21 st of each month

                     Beginning                                               Paydown          Ending
         Period       Financed                            Imputed          of Financed       Financed
         Ending        Balance              Payment       Interest           Balance          Balance
         ------        -------              -------       --------           -------          -------
<S>    <C>         <C>                    <C>             <C>              <C>           <C>         
        1/21/97     3,122,000.00           37,569.87       20,325.52        17,244.35     3,104,755.65
        2/21/97     3,104,755.65           37,569.87       20,213.25        17,356.62     3,087,399.03
        3/21/97     3,087,399.03           37,569.87       20,100.25        17,469.62     3,069,929.42
        4/21/97     3,069,929.42           37,569.87       19,986.52        17,583.35     3,052,346.07
        5/21/97     3,052,346.07           37,569.87       19,872.04        17,697.83     3,034,648.24
        6/21/97     3,034,648.24           37,569.87       19,756.82        17,813.05     3,016,835.20
        7/21/97     3,016,835.20           37,569.87       19,640.85        17,929.02     2,998,906.18
        8/21/97     2,998,906.18           37,569.87       19,524.13        18,045.74     2,980,860.44
        9/21/97     2,980,860.44           37,569.87       19,406.64        18,163.23     2,962,697.21
       10/21/97     2,962,697.21           37,569.87       19,288.39        18,281.48     2,944,415.74
       11/21/97     2,944,415.74           37,569.87       19,169.37        18,400.50     2,926,015.24
       12/21/97     2,926,015.24           37,569.87       19,049.58        18,520.29     2,907,494.95
        1/21/98     2,907,494.95           37,569.87       18,929.00        18,640.87     2,888,854.08
        2/21/98     2,888,854.08           37,569.87       18,807.64        18,762.23     2,870,091.86
        3/21/98     2,870,091.86           37,569.87       18,685.49        18,884.38     2,851,207.48
        4/21/98     2,851,207.48           37,569.87       18,562.55        19,007.32     2,832,200.16
        5/21/98     2,832,200.16           37,569.87       18,438.80        19,131.07     2,813,069.09
        6/21/98     2,813,069.09           37,569.87       18,314.25        19,255.62     2,793,813.47
        7/21/98     2,793,813.47           37,569.87       18,188.89        19,380.98     2,774,432.49
        8/21/98     2,774,432.49           37,569.87       18,062.71        19,507.16     2,754,925.33
        9/21/98     2,754,925.33           37,569.87       17,935.71        19,634.16     2,735,291.18
       10/21/98     2,735,291.18           37,569.87       17,807.89        19,761.98     2,715,529.19
       11/21/98     2,715,529.19           37,569.87       17,679.23        19,890.64     2,695,638.55
       12/21/98     2,695,638.55           37,569.87       17,549.73        20,020.14     2,675,618.41
        1/21/99     2,675,618.41           37,569.87       17,419.39        20,150.48     2,655,467.93
        2/21/99     2,655,467.93           37,569.87       17,288.20        20,281.67     2,635,186.26
        3/21/99     2,635,186.26           37,569.87       17,156.16        20,413.71     2,614,772.55
        4/21/99     2,614,772.55           37,569.87       17,023.26        20,546.61     2,594,225.94
        5/21/99     2,594,225.94           37,569.87       16,889.49        20,680.38     2,573,545.56
        6121/99     2,573,545.56           37,569.87       16,754.85        20,815.02     2,552,730.55
        7/21/99     2,552,730.55           37,569.87       16,619.34        20,950.53     2,531,780.02
        8/21/99     2,531,780.02           37,569.87       16,482.94        21,086.93     2,510,693.09
        9/21/99     2,510,693.09           37,569.87       16,345.66        21,224.21     2,489,468.88
       10/21/99     2,489,468.88           37,569.87       16,207.48        21,362.39     2,468,106.49
       11/21/99     2,468,106.49           37,569.87       16,068.40        21,501.47     2,446,605.02
       12/21/99     2,446,605.02           37,569.87       15,928.42        21,641.45     2,424,963.57
        1/21/00     2,424,963.57           37,569.87       15,787.52        21,782.35     2,403,181.22
        2/21/00     2,403,181.22           37,569.87       15,645.71        21,924.16     2,381,257.06
</TABLE>
                                     Page 1
<PAGE>
                                    EXHIBIT A
                             Capital Lease Schedule
                             ----------------------
<TABLE>
<CAPTION>
  Amount Financed Through Capital Lease                                                  $ 3,122,000
  Finance Rate %                                                                              7.8125
  Term in Months                                                                                 120
  Payment due date                                                                21st of each month

                     Beginning                                               Paydown          Ending
         Period       Financed                            Imputed          of Financed       Financed
         Ending        Balance              Payment       Interest           Balance          Balance
         ------        -------              -------       --------           -------          -------
<S>    <C>         <C>                    <C>             <C>              <C>           <C>         
        3/21/00     2,381,257.06          37,569.87        15,502.98        22,066.89     2,359,190.17
        4/21/00     2,359,190.17          37,569.87        15,359.31        22,210.56     2,336,979.61
        5/21/00     2,336,979.61          37,569.87        15,214.71        22,355.16     2,314,624.45
        6/21/00     2,314,624.45          37,569.87        15,069.17        22,500.70     2,292,123.75
        7/21/00     2,292,123.75          37,569.87        14,922.68        22,647.19     2,269,476.56
        8/21/00     2,269,476.56          37,569.87        14,775.24        22,794.63     2,246,681.93
        9/21/00     2,246,681.93          37,569.87        14,626.84        22,943.03     2,223,738.89
       10/21/00     2,223,738.89          37,569.87        14,477.47        23,092.40     2,200,646.49
       11/21/00     2,200,646.49          37,569.87        14,327.13        23,242.74     2,177,403.74
       12/21/00     2,177,403.74          37,569.87        14,175.81        23,394.06     2,154,009.68
        1/21/01     2,154,009.68          37,569.87        14,023.50        23,546.37     2,130,463.31
        2/21/01     2,130,463.31          37,569.87        13,870.20        23,699.67     2,106,763.64
        3/21/01     2,106,763.64          37,569.87        13,715.91        23,853.96     2,082,909.68
        4/21/01     2,082,909.68          37,569.87        13,560.61        24,009.26     2,058,900.42
        5/21/01     2,058,900.42          37,569.87        13,404.30        24,165.57     2,034,734.85
        6/21/01     2,034,734.85          37,569.87        13,246.97        24,322.90     2,010,411.95
        7/21/01     2,010,411.95          37,569.87        13,088.62        24,481.25     1,985,930.70
        8/21/01     1,985,930.70          37,569.87        12,929.24        24,640.63     1,961,290.07
        9/21/01     1,961,290.07          37,569.87        12,768.82        24,801.05     1,936,489.02
       10/21/01     1,936,489.02          37,569.87        12,607.35        24,962.52     1,911,526.50
       11/21/01     1,911,526.50          37,569.87        12,444.83        25,125.04     1,886,401.46
       12121/01     1,886,401.46          37,569.87        12,281.26        25,288.61     1,861,112.85
        1/21/02     1,861,112.85          37,569.87        12,116.62        25,453.25     1,835,659.60
        2/21102     1,835,659.60          37,569.87        11,950.91        25,618.96     1,810,040.64
        3/21102     1,810,040.64          37,569.87        11,784.12        25,785.75     1,784,254.89
        4/21/02     1,784,254.89          37,569.87        11,616.24        25,953.63     1,758,301.26
        5/21/02     1,758,301.26          37,569.87        11,447.27        26,122.60     1,732,178.66
        6/21/02     1,732,178.66          37,569.87        11,277.20        26,292.67     1,705,886.00
        7/21102     1,705,886.00          37,569.87        11,106.03        26,463.84     1,679,422.16
        8/21/02     1,679,422.16          37,569.87        10,933.74        26,636.13     1,652,786.03
        9/21/02     1,652,786.03          37,569.87        10,760.33        26,809.54     1,625,976.48
       10/21/02     1,625,976.48          37,569.87        10,585.78        26,984.09     1,598,992.40
       11/21/02     1,598,992.40          37,569.87        10,410.11        27,159.76     1,571,832.63
       12/21/02     1,571,832.63          37,569.87        10,233.29        27,336.58     1,544,496.05
        1/21/03     1,544,496.05          37,569.87        10,055.31        27,514.56     1,516,981.49
        2/21/03     1,516,981.49          37,569.87         9,876.18        27,693.69     1,489,287.80
        3/21/03     1,489,287.80          37,569.87         9,695.88        27,873.99     1,461,413.82
        4/21/03     1,461,413.82          37,569.87         9,514.41        28,055.46     1,433,358.36
</TABLE>
                                     Page 2
<PAGE>
                                    EXHIBIT A
                             Capital Lease Schedule
                             ----------------------
<TABLE>
<CAPTION>
  Amount Financed Through Capital Lease                                             $ 3,122,000
  Finance Rate %                                                                         7.8125
  Term in Months                                                                            120
  Payment due date                                                           21st of each month

                     Beginning                                               Paydown          Ending
         Period       Financed                            Imputed          of Financed       Financed
         Ending      Balance                Payment       Interest           Balance          Balance
         ------      -------                -------       --------           -------          -------
<S>    <C>         <C>                    <C>             <C>              <C>           <C>         
        5/21/03     1,433,358.36          37,569.87         9,331.76        28,238.11     1,405,120.25
        6/21103     1,405,120.25          37,569.87         9,147.92        28,421.95     1,376,698.30
        7/21/03     1,376,698.30          37,569.87         8,962.88        28,606.99     1,348,091.31
        8/21/03     1,348,091.31          37,569.87         8,776.64        28,793.23     1,319,298.07
        9/21/03     1,319,298.07          37,569.87         8,589.18        28,980.69     1,290,317.38
       10/21/03     1,290,317.38          37,569.87         8,400.50        29,169.37     1,261,148.02
       11/21/03     1,261,148.02          37,569.87         8,210.60        29,359.27     1,231,788.75
       12/21/03     1,231,788.75          37,569.87         8,019.46        29,550.41     1,202,238.33
        1/21/04     1,202,238.33          37,569.87         7,827.07        29,742.80     1,172,495.54
        2/21/04     1,172,495.54          37,569.87         7,633.43        29,936.44     1,142,559.10
        3/21/04     1,142,559.10          37,569.87         7,438.54        30,131.33     1,112,427.77
        4/21/04     1,112,427.77          37,569.87         7,242.37        30,327.50     1,082,100.27
        5/21/04     1,082,100.27          37,569.87         7,044.92        30,524.95     1,051,575.32
        6/21/04     1,051,575.32          37,569.87         6,846.19        30,723.68     1,020,851.64
        7/21/04     1,020,851.64          37,569.87         6,646.17        30,923.70       989,927.94
        8/21/04       989,927.94          37,569.87         6,444.84        31,125.03       958,802.92
        9/21/04       958,802.92          37,569.87         6,242.21        31,327.66       927,475.25
       10/21/04       927,475.25          37,569.87         6,038.25        31,531.62       895,943.63
       11/21/04       895,943.63          37,569.87         5,832.97        31,736.90       864,206.73
       12/21/04       864,206.73          37,569.87         5,626.35        31,943.52       832,263.20
        1/21/05       832,263.20          37,569.87         5,418.38        32,151.49       800,111.71
        2/21/05       800,111.71          37,569.87         5,209.06        32,360.81       767,750.91
        3/21/05       767,750.91          37,569.87         4,998.38        32,571.49       735,179.41
        4/21105       735,179.41          37,569.87         4,786.32        32,783.55       702,395.87
        5/21/05       702,395.87          37,569.87         4,572.89        32,996.98       669,398.89
        6/21/05       669,398.89          37,569.87         4,358.07        33,211.80       636,187.08
        7/21/05       636,187.08          37,569.87         4,141.84        33,428.03       602,759.06
        8/21/05       602,759.06          37,569.87         3,924.21        33,645.66       569,113.40
        9/21/05       569,113.40          37,569.87         3,705.17        33,864.70       535,248.69
       10/21/05       535,248.69          37,569.87         3,484.69        34,085.18       501,163.52
       11/21/05       501,163.52          37,569.87         3,262.78        34,307.09       466,856.43
       12/21/05       466,856.43          37,569.87         3,039.43        34,530.44       432,325.99
        1/21/06       432,325.99          37,569.87         2,814.62        34,755.25       397,570.74
        2/21/06       397,570.74          37,569.87         2,588.35        34,981.52       362,589.22
        3/21/06       362,589.22          37,569.87         2,360.61        35,209.26       327,379.96
        4/21/06       327,379.96          37,569.87         2,131.38        35,438.49       291,941.47
        5/21/06       291,941.47          37,569.87         1,900.66        35,669.21       256,272.26
        6/21/06       256,272.26          37,569.87         1,668.44        35,901.43       220,370.83
</TABLE>
                                     Page 3
<PAGE>
                                    EXHIBIT A
                             Capital Lease Schedule
                             ----------------------


<TABLE>
<CAPTION>
  Amount Financed Through Capital Lease                                                  $ 3,122,000
  Finance Rate %                                                                              7.8125
  Term in Months                                                                                 120
  Payment due date                                                                21st of each month

                      Beginning                                              Paydown          Ending
         Period        Financed                           Imputed          of Financed       Financed
         Ending         Balance             Payment       Interest           Balance          Balance
         ------         -------             -------       --------           -------          -------
<S>    <C>         <C>                    <C>             <C>              <C>           <C>         
        7/21/06       220,370.83           37,569.87       1,434.71         36,135.16       184,235.67
        8/21/06       184,235.67           37,569.87       1,199.45         36,370.42       147,865.25
        9/21/06       147,865.25           37,569.87         962.66         36,607.21       111,258.04
       10/21/06       111,258.04           37,569.87         724.34         36,845.53        74,412.51
       11/21/06        74,412.51           37,569.87         484.46         37,085.41        37,327.09
       12/21/06        37,327.09           37,570.11         243.01         37,327.10         (0.00)
</TABLE>
                                     Page 4