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                                                                  Exhibit 10.1.2

                                  BAKER CENTER
                             LEASE OF OFFICE SPACE

DATE:              AUGUST 14, 1996

BETWEEN:           ST. PAUL PROPERTIES, INC.
(address)          435 Peavey Building
                   730 Second Avenue South
                   Minneapolis, MN 55402                          ("Landlord")

AND                ADVANCED TELECOMMUNICATIONS, INC.
(address)          410 Peavey Building
                   730 Second Avenue South
                   Minneapolis, MN 55402

                                                                  ("Tenant")

FOR PREMISES IN: Peavey Building, Minneapolis, MN

LANDLORD AND TENANT, in consideration of the covenants herein contained, hereby
agree as follows:

ARTICLE 1.00 DEFINITIONS

1.01  Definitions In this Lease:

      (a)   "Annual Rent" means the amount payable by Tenant to Landlord in
            respect of each year of the Term under Article 4.01.

      (b)   "Article" means an article of this Lease.

      (c)   "Commencement Date" means the date set forth in Article 3.01 as the
            first day of the Term.

      (d)   "Exhibit A" means the plan(s) attached hereto as Exhibit A.

      (e)   "Exhibit B" means the provisions relating to Occupancy Costs and
            other matters attached hereto as Exhibit B.

      (f)   "Exhibit C" means the Rules and Regulations attached hereto as
            Exhibit C.

      (g)   "Expiration Date" means the date set forth in Article 3.01 as the
            last day of the Term.

      (h)   "Fiscal Year" means the calendar year unless Landlord elects by
            thirty (30) days' notice to Tenant that Fiscal Year shall mean a
            twelve-month period from time to time determined by Landlord, with
            concurrence of the appropriate taxation authorities, at the end of
            which Landlord's books are balanced for auditing or taxation
            purposes.

      (i)   "Lease" means this lease, Exhibits A, B, C and (if attached) D to
            this lease, and every properly executed instrument which by its
            terms amends, modifies or supplements this lease.

      (j)   "Occupancy Costs" means amounts payable by Tenant to Landlord under
            Article 4.02.

      (k)   "Other Charges" means amounts payable by Tenant to Landlord under
            Article 4.03.


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      (l)   "Premises" means the area on the 4th floor of the Building as
            indicated on Exhibit A. hereby deemed to contain 3.337 square feet,
            plus for calculation of Rent only, an additional 400 square feet of
            unallocated space in the Building.

      (m)   "Rent" means the aggregate of all amounts payable by Tenant to
            Landlord under Articles 4.01, 4.02 and 4.03.

      (n)   "Term" means the period of time set out in Article 3.01.

      Other words and phrases are defined in Exhibit B.

ARTICLE 2.00 GRANT OF LEASE

2.01  Grant  Landlord hereby demises and leases the Premises to Tenant, and
      Tenant hereby leases and accepts the Premises from Landlord, to have and
      to hold during the Term, subject to the terms, covenants and conditions of
      this Lease.

2.02  Quiet Enjoyment  So long as tenant observes and performs all of the terms,
      covenants and conditions to be observed and performed by Tenant under this
      Lease, tenant shall quietly have, hold and enjoy possession of the
      Premises during the Term subject to the terms and conditions of this
      Lease.

2.03  Covenants of Landlord and Tenant  Landlord covenants to observe and
      perform all of the terms and conditions to be observed and performed by
      Landlord under this Lease. Tenant covenants to pay the Rent when due under
      this Lease, and to observe and perform all of the terms and conditions to
      be observed and performed by Tenant under this Lease.

ARTICLE 3.00 TERM AND POSSESSION

3.01  Term Notwithstanding  Articles 3.02 and 3.03, the term of this Lease shall
      be five (5) years, sixteen (16) days, beginning on the fifteenth day of
      the month of September, 1996 and ending on the last day of the month of
      September, 2001, unless terminated earlier as provided in this Lease.

3.02  Early Occupancy  If Tenant begins to conduct business in all or any
      portion of the Premises before the Commencement Date, Tenant shall pay to
      Landlord on the Commencement Date a rental in respect thereof for the
      period from the date Tenant begins to conduct business therein to the
      Commencement Date, which rental shall be that proportion of Rent for one
      calendar year which the number of days in such period bears to 365. Except
      where clearly inappropriate, the provisions of this Lease shall be
      applicable during such period.

3.03  Delayed Possession  If Landlord is delayed in delivering possession of all
      or any portion of the Premises on the date (not later than one year after
      the Commencement Date) when Landlord delivers possession of all of the
      Premises. This Lease shall not be void or voidable nor shall Landlord be
      liable to Tenant for any loss or damage resulting from any delay in
      delivering possession of the Premises to Tenant nor shall any delay be
      construed in any way to affect the Expiration Date, but unless such delay
      is principally caused by or attributable to Tenant, its servants, agents
      or independent contractors, no Rent shall be payable by Tenant for the
      period prior to the date on which Landlord can so deliver possession of
      all of the Premises, unless Tenant elects to take possession of a portion
      of the Premises whereupon Rent shall be payable in respect of that portion
      from the date such possession is so taken.

3.04  Acceptance of Premises  Taking possession of all or any portion of the
      Premises by Tenant shall be rebuttal evidence as against Tenant that the
      Premises or such portion thereof are in satisfactory condition on the date
      of taking possession.

ARTICLE 4.00 RENT AND OCCUPANCY COSTS

4.01  Annual Rent  Tenant shall pay to Landlord as Annual Rent for the Premises
      the annual sum of twenty-two thousand four hundred twenty-two dollars and
      no/100 ($22,422.00) in respect to the period from and including the
      Commencement Date through September 30, 1997; twenty-six thousand one
      hundred fifty-nine dollars and no/100 ($26,159.00) in respect to the
      period October 1, 1997 through September 30, 1998; thirty-three thousand
      six hundred thirty-three dollars and no/l00 ($33,633.00) in respect to the
      period October 1, 1998 through September 30, 1999; and forty-four thousand
      eight hundred forty-four dollars and no/l00 ($44,844.00) in respect to the
      period October 1, 1999 through September 30, 2001.


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      payable in advance and without notice in monthly installments (each equal
      to one-twelfth of the Annual Rent) on the Commencement Date and on the
      first day of each calendar month thereafter during the term.

4.02  Occupancy Costs  Tenant shall pay to Landlord, at the times and in the
      manner provided in Article 4.06, the Occupancy Costs (if any) determined
      under Exhibit B.

4.03  Other Charges  Tenant shall pay to Landlord, at the times and in the
      manner provided in this Lease or, if not so provided, as reasonably
      required by Landlord, all amounts (other than that payable under Articles
      4.01 and 4.02 which are payable by Tenant to Landlord under this Lease).

4.04  Payment of Rent-General  All amounts payable by Tenant to Landlord under
      this Lease shall be deemed to be Rent and shall be payable and recoverable
      as Rent in the manner herein provided, and Landlord shall have all rights
      against Tenant for default in any such payment as in the case of arrears
      of rent. Rent shall be paid to Landlord without deduction or set-off in
      legal tender of the jurisdiction in which the Building is located, at the
      address of Landlord as set forth in the beginning of this Lease, or to
      such other person or at such other address as Landlord may from time to
      time designate in writing. Tenant's obligation to pay Rent shall survive
      the expiration or earlier termination of this Lease.

4.05  Annual Rent - Partial Months If the Term begins on a day other than the
      first day of a calendar month or ends on a day other than the last day of
      a calendar month, the installment of Annual Rent payable in respect of
      that calendar month shall be that proportion of the Annual Rent which the
      number of days in that calendar month which fall within the Term bears to
      365.

4.06  Payment - Occupancy Costs

      (a)   Unless delayed by causes beyond Landlord's reasonable control, prior
            to the Commencement Date and the beginning of each Fiscal Year
            thereafter, Landlord shall compute and deliver to Tenant a bona fide
            estimate of Occupancy Costs for the appropriate Fiscal Year. Without
            further notice Tenant shall pay to Landlord in monthly installments
            one-twelfth of such estimate simultaneously with Tenant's payments
            of Annual Rent during such Fiscal Year.

      (b)   Landlord may at any time during a Fiscal Year compute and deliver to
            Tenant a revised bona fide estimate of Occupancy Costs for that
            Fiscal Year, together with Landlord's determination of the
            adjustment to Tenant's monthly installments of Occupancy Costs for
            that Fiscal Year to fully recover the revised estimate of Occupancy
            Costs in that Fiscal Year. Without further notice, Tenant shall pay
            to Landlord monthly installments of Occupancy Costs in accordance
            with that adjustment.

      (c)   Unless delayed by causes beyond Landlord's reasonable control,
            Landlord shall deliver to Tenant within one hundred twenty (120)
            days after the end of each Fiscal Year a written statement (the
            "statement") setting out in reasonable detail the amount of
            Occupancy Costs for such Fiscal Year and certified to be correct by
            an officer of Landlord. If the aggregate of monthly installments of
            Occupancy Costs actually paid by Tenant to Landlord during such
            Fiscal Year differs from the amount of Occupancy Costs payable for
            such Fiscal Year under Article 4.02, Tenant shall pay, or if Tenant
            is not then in default under this Lease beyond the applicable grace
            period, Landlord shall refund the difference (as the case may be)
            without interest within thirty (30) days after the date of delivery
            of the Statement.

      (d)   If Landlord and Tenant disagree on the accuracy of Occupancy Costs
            as set forth in the Statement, Tenant shall nevertheless make
            payment in accordance with any notice given by Landlord, and
            Landlord shall immediately refer the disagreement to a public
            accountant, architect, insurance broker or other professional
            consultant selected by Landlord and approved by Tenant, which
            approval will not be unreasonably withheld, who shall be deemed to
            be acting as an expert and not an arbitrator, and a determination
            signed by the selected expert shall be final and binding on both
            Landlord and Tenant. Any adjustment required to any previous payment
            made by Tenant or Landlord by reason of any such decision shall be
            made within fourteen (14) days thereof, and the party required to
            make payment under such adjustment shall bear all costs of the
            expert making such decision, except where that payment represents 3%
            or less of the Occupancy Costs that were the subject of the
            disagreement in which case Tenant shall bear all costs.


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      (e)   Neither party may claim re-adjustment in respect of occupancy Costs
            for a Fiscal Year if based upon any error of computation or
            allocation except by notice delivered to the other party within six
            months after the date of delivery of the Statement.

ARTICLE 5.00 USE OF PREMISES

5.01  Use  The Premises shall be used and occupied only as executive,
      administrative, and general business offices of Tenant or for such other
      purpose as Landlord may specifically authorize in writing.

5.02  Compliance  The Premises shall be used and occupied in a prudent, safe,
      careful and proper manner and in such manner as not to contravene any
      present or future governmental or quasi-governmental laws in force or
      regulations or orders, or to make void or voidable any insurance on the
      Building. If, due to Tenant's non-compliance with the foregoing sentence,
      Landlord's insurance carrier(s) reasonably imposes an increased or extra
      premium for Landlord's insurance on the Building, Tenant shall pay such
      increased or extra premium. If, due solely to Tenant's use of the
      Premises, improvements are necessary to comply with any of the foregoing
      or with the requirements of insurance carriers, Landlord, or Tenant at
      Landlord's election, shall make such improvements and, in either event,
      Tenant shall pay the entire cost thereof. Any such improvements by Tenant
      shall comply with the provisions of Article 7.04.

5.03  Abandonment  Tenant shall not vacate or abandon the Premises at any time
      during the Term without Landlord's prior written consent.

5.04  Nuisance  Tenant shall not cause or maintain any nuisance in or about the
      Premises, and shall keep the Premises free of debris, rodents, vermin and
      anything of a dangerous, noxious or offensive nature or which could create
      a fire hazard (through undue load on electrical circuits or otherwise) or
      undue vibration, heat, odor or noise.

ARTICLE 6.00 SERVICES, MAINTENANCE, REPAIR AND ALTERATIONS BY Landlord

6.01  Operation of Building  During the Term Landlord shall operate and maintain
      the Building in accordance with all applicable laws and regulations and
      with standards from time to time prevailing for first-class office
      buildings in the area in which the Building is located and, subject to
      participation by Tenant by payment of Occupancy Costs under Article 4.02,
      shall provide the services set out in Articles 6.02 and 6.03.

6.02  Services to Premises  Landlord shall provide in the Premises:

      (a)   heat, ventilation and cooling as required for the comfortable use
            and occupancy of the Premises during normal business hours,

      (b)   janitor services, including window washing. Monday through Friday,
            excluding holidays, as reasonably required to keep the Premises in a
            clean and wholesome condition, provided that Tenant shall leave the
            Premises in a reasonably orderly condition at the end of each
            business day, and

      (c)   maintenance, repair and replacement as set out in Article 6.04.

6.03 Building Services  Landlord shall provide in the Building:

      (a)   domestic running water and necessary supplies in washrooms
            sufficient for the normal use thereof by occupants in the Building.

      (b)   access to and egress from the Premises, including elevator or
            escalator service if included in the Building,

      (c)   heat, ventilation, cooling, lighting, electric power, domestic
            running water, and janitor service in those areas of the Building
            from time to time designated by Landlord for use during normal
            business hours by Tenant in common with all tenants and other
            persons in the Building but under the exclusive control of Landlord,


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      (d)   a general directory board on which Tenant shall be entitled to have
            shown, provided that Landlord shall have exclusive control thereof
            and of the space thereon to be allocated to each tenant, and

      (e)   maintenance, repair, and replacement as set out in Article 6.04.

6.04  Maintenance, Repair and Replacement  Landlord shall operate, maintain,
      repair and replace the systems, facilities and equipment necessary for the
      proper operation of the Building and for provision of Landlord's services
      under Articles 6.02 and 6.03 (except such systems, facilities and
      equipment as may be installed by or be the property of Tenant) and shall
      be responsible for and shall maintain and repair the foundations,
      structure and roof of the Building and repair damage to the Building which
      Landlord is obligated to insure against under Article 9.00, provided that

      (a)   if all or part of such systems, facilities or equipment is
            destroyed, damaged, impaired or taken by condemnation, Landlord
            shall have a reasonable time in which to complete the necessary
            repair or replacement, and during that time shall be required only
            to maintain such services as are reasonably possible in the
            circumstances, and

      (b)   Landlord may temporarily reduce or discontinue such services or any
            of them at such times as may be reasonably necessary due to causes
            (except lack of funds) beyond the reasonable control of Landlord.

6.05  Additional Services

      (a)   If from time to time requested in writing by Tenant and to the
            extent that it is reasonably able, Landlord shall endeavor to
            provide in the Premises services in addition to those set out in
            Article 6.02, provided that Tenant shall within ten (10) days of
            receipt of any statement for any such additional service pay
            Landlord therefore at such rates as Landlord may from time to time
            reasonably establish. So long as Landlord is entitled to terminate
            this Lease, Landlord may terminate any such additional services.

      (b)   If electricity is provided by Landlord under Article 7.02(b),
            Landlord will pay the cost thereof and will apportion such costs
            among the users based on meter readings for the Premises or, if the
            Premises are not separately metered, according to the proportion of
            each user's floor space to the total floor space of all users on a
            common meter with the Premises. Upon receipt of Landlord's statement
            of apportionment, Tenant shall reimburse Landlord for the amounts
            which Tenant is shown thereon to be liable to Landlord.

      (c)   Tenant shall not without Landlord's prior written consent, which
            consent will not be unreasonably withheld, install in the Premises
            equipment (including telephone equipment) which generates sufficient
            heat to affect the temperature otherwise maintained in the Premises
            by the air conditioning system as normally operated. If Tenant
            installs such equipment, Landlord may install supplementary air
            conditioning units, facilities or services in the Premises, or
            modify its air conditioning system, as may in Landlords reasonable
            opinion be required to maintain proper temperature levels, and
            Tenant shall pay Landlord the cost thereof (including, without
            limitation, installation, operation and maintenance expenses) within
            ten (10) days of receipt of notice from Landlord.

      (d)   If Landlord shall from time to time reasonably determine that the
            use of electricity or any other utility or service in the Premises
            is disproportionate to the use of other tenants, Landlord may
            separately charge Tenant for the excess costs attributable to such
            disproportionate use. In the event of such determination, Landlord
            may also install and maintain, at Tenant's expense, metering devices
            for determining the use of any such utility or service in the
            Premises.

6.06  Alterations by Landlord  Landlord may from time to time

      (a)   make repairs, replacements, changes or additions to the structure,
            systems, facilities and equipment in the Premises where necessary to
            serve the Premises or other parts of the Building or Project.

      (b)   make changes in or additions to any part of the Building or Project
            not in or forming part of the Premises and

      (c)   change or alter the location of those areas of the Building, or
            Project from time to time designated by Landlord for use during
            Normal Business Hours for the Building by Tenant in common with all
            tenants and other persons in the Building but under the exclusive
            control of Landlord,


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      provided that, subject to Article 6.04, Landlord shall not disturb or
      interfere with Tenant's use of the Premises and operation of its business
      any more than is reasonably necessary under the circumstances and shall
      repair any damage to the Premises caused thereby.

6.07  Access by Landlord  Tenant shall permit Landlord to enter the Premises
      outside normal business hours and during normal business hours where such
      will not reasonably disturb or interfere with Tenant's use of the Premises
      and operation of his business, to examine and inspect the Premises and
      show the Premises to any prospective purchaser or mortgagee of the
      Building or person wishing to lease them, to provide services or make
      repairs, replacements, changes or alterations as set out in this Lease,
      and to take such steps as Landlord may deem necessary for the safety,
      improvement or preservation of the Premises, the Building, or the Project.
      Landlord shall, to the extent reasonably possible, consult with or give
      notice to Tenant prior to such entry, and no such entry shall constitute
      an eviction or entitle Tenant to any abatement of Rent.

6.08  Energy, Conservation and Security Policies  Landlord shall be deemed to
      have observed and performed the terms and conditions to be performed by
      Landlord under this Lease, including those relating to the provision of
      utilities and services, if in doing so it acts in accordance with a
      directive, policy or request of a governmental or quasi-governmental
      authority serving the public interest in the fields of energy,
      conservation or security.

6.09  Limitation

      (a)   Landlord shall use reasonable diligence in carrying out its
            obligations under Article 6.00, but shall not be liable under any
            circumstances for any consequential damage to any person or property
            for any failure to carry out such obligations.

      (b)   No reduction or discontinuance of any services under this Article
            6.00 shall be construed as an eviction of Tenant or (except as
            specifically provided in this Lease) release Tenant from any
            obligation of Tenant under this Lease.

      (c)   Nothing contained in this Article 6.00 shall derogate from the
            provisions of Article 15.00 or Article 16.00.

ARTICLE 7.00 UTILITIES, MAINTENANCE, REPAIR AND ALTERATIONS BY TENANT

7.01  Condition of Premises  Except to the extent to Landlord is specifically
      responsible therefore under this Lease, Tenant shall maintain the Premises
      and all improvements therein in good order and condition, including

      (a)   repainting and redecorating the Premises and cleaning drapes and
            carpets at reasonable intervals as needed, and

      (b)   making repairs, replacements and alterations as needed, including
            those necessary to comply with the requirements of any governmental
            or quasi-governmental authority having jurisdiction over the
            Premises.

7.02  Electricity

      (a)   During the term, Tenant shall provide in the Premises at its own
            expense all electricity required in the Premises, except electricity
            required for such heat, ventilation and cooling of the Premises as
            shall be the Landlord's responsibility under Article 6.02(a).

      (b)   If during the Term the electrical utility serving the Building
            ceases to make electricity directly available to Tenant, Landlord
            shall connect Tenant's electrical service to the Building system at
            Tenant's cost and expense and, to the extent such utility makes
            electricity available to Landlord, shall provide electrical power in
            the Premises as an additional service in accordance with the
            conditions of Article 6.05.

7.03  Failure to Maintain Premises  If Tenant fails to perform any obligation
      under Article 7.01, then on not less than ten (10) days' notice to Tenant
      (or without notice in an emergency). Landlord may enter the Premises and
      perform such obligation without liability to Tenant for any loss or damage
      to Tenant thereby incurred, and Tenant shall pay Landlord for the cost
      thereof, plus 20% of such cost for overhead and supervision, within ten
      (10) days of notice from Landlord of such cost.


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7.04  Alterations by Tenant  Tenant may from time to time at its own expense
      make non-structural changes, additions and improvements in the Premises to
      better adapt the same to its business, provided that any such change,
      addition or improvement shall

      (a)   comply with the requirements of any governmental or
            quasi-governmental authority having jurisdiction.

      (b)   be made only with the prior written consent of Landlord, which
            consent will not be unreasonably withheld,

      (c)   equal or exceed the then current standard for the Building, and

      (d)   be carried out only by persons selected by Tenant and approved in
            writing by Landlord, which approval will not be unreasonably
            withheld, who shall if required by Landlord deliver to Landlord
            before commencement of the work performance and payment bonds as
            well as proof of worker's compensation and public liability and
            property damage insurance coverage, with Landlord names as an
            additional insured, in amounts with companies, and in forms
            reasonably satisfactory to Landlord, which shall remain in effect
            during the entire period in which the work will be carried out.

            Any increase in property taxes on or fire or casualty insurance
            premiums for the Building attributable to such change, addition or
            improvements shall be borne by Tenant.

7.05  Trade Fixtures and Personal Property  Tenant may install in the Premises
      its usual trade fixtures and personal property in a proper manner,
      provided that no such installation shall interfere with or damage the
      mechanical or electrical systems or the structure of the Building. Trade
      fixtures and personal property installed in the Premises by Tenant may be
      removed from the Premises

      (a)   from time to time in the ordinary course of Tenant's business or in
            the course of reconstruction, renovation or alteration of the
            Premises by Tenant, and

      (b)   during a reasonable period prior to the expiration of the Term,

      provided that Tenant conducts such installation and removal in a manner
      which does not unreasonably interfere with the rights of other tenants in
      the Building and otherwise in compliance with any Rules and Regulations
      promulgated under Article 14.00, and Tenant promptly repairs at its own
      expense any damage to the Premises, Building or Project resulting from
      such installation and removal.

7.06  Mechanic Liens  Tenant shall pay before delinquency all costs for work
      done or caused to be done by Tenant in the Premises which could result in
      any lien or encumbrance on Landlord's interest in the land and Building or
      any part thereof or on Tenant's interest in the Premises, shall keep the
      title to the Land and Building and every part thereof free and clear of
      any lien or encumbrance in respect of such work and shall indemnify and
      hold harmless Landlord against any claim, loss, cost, demand and legal or
      other expense, whether in respect of any lien or otherwise, arising out of
      the supply of materials, services or labor for such work. Tenant shall
      immediately notify Landlord of any such lien, claim of lien or other
      action of which it has or reasonably should have knowledge and which
      affects the title to the Land or Building or any part thereof or to
      Tenant's interest in the Premises, and shall cause the same to be removed
      within five (5) days (or such additional time as Landlord may reasonably
      consent to in writing) failing which Landlord may take such action as
      Landlord deems necessary to remove the same and the entire cost thereof
      shall be immediately due and payable by Tenant to Landlord.

7.07  Signs  Any sign, lettering or design of Tenant which is visible from the
      exterior of the Premises shall be a Tenant's expense and subject to
      approval by Landlord, and shall conform to the uniform pattern of
      identification signs for tenants in the Building as prescribed by
      Landlord, Tenant shall not inscribe or affix any sign, lettering or design
      in the Premises or Building which is visible from the exterior of the
      Building.

ARTICLE 8.00 TAXES

8.01  Landlord's Taxes  Landlord shall pay before delinquency (with
      participation by Tenant by payment of Occupancy Costs under Article 4.02)
      every real estate tax, assessment, license fee and other charge, excepting
      Tenant's Taxes under Article 4.02) every real estate tax, assessment,
      license fee and other charge, excepting Tenant's Taxes under Article 8.02
      which is imposed,


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      levied, assessed or charged by any governmental or quasi-governmental
      authority having jurisdiction and which is payable in respect of the Term
      upon or on account of the Land or Building.

8.02  Tenant's Taxes  Tenant shall pay before delinquency every tax, assessment,
      license fee, excise and other charge, however described, which is imposed,
      levied, assessed or charged by any governmental or quasi-governmental
      authority having jurisdiction and which is payable in respect of the Term
      upon or on account of

      (a)   operations at, occupancy of, or conduct of business in or from the
            Premises by or with the permission of Tenant,

      (b)   fixtures or personal property in the Premises which do not belong to
            the Landlord, and

      (c)   the Rent paid or payable by Tenant to Landlord for the Premises or
            for the use and occupancy of all or any part thereof;

      provided that if it is a rent or similar tax and Landlord so elects by
      notice to Tenant, Tenant shall add any amounts payable under this Article
      8.02 to the monthly installments of Annual Rent payable under Article 4.01
      and Landlord shall remit such amounts to the appropriate authorities.

8.03  Right to Contest  Landlord and Tenant shall each have the right to contest
      in good faith the validity or amount of any tax, assessment, license fee,
      excise fee and any other charge which it is responsible to pay under this
      Article 8.00, provided that no contest by Tenant may involve the
      possibility of forfeiture, sale or disturbance of Landlord's interest in
      the Premises. Building or Project and that upon the final determination of
      any contest by Tenant, Tenant shall immediately pay and satisfy the amount
      found to be due, together with any costs, penalties and interest.

ARTICLE 9.00 INSURANCE

9.01  Landlord's Insurance  During the Term, Landlord shall maintain at its own
      expense (with participation by Tenant by payment of Occupancy Costs under
      Article 4.01) liability insurance, fire insurance with extended coverage,
      boiler and pressure vessel insurance, and other insurance on the Building
      and all property and interest of Landlord in the Building with coverage
      and in amounts not less than those which are from time to time reasonably
      acceptable to a prudent owner in the area in which the Building is
      located. Policies for such insurance shall waive, to the extent available
      from Landlord's insurance carrier(s) any right of subrogation against
      Tenant. If there shall be an additional charge for such waiver, Tenant
      shall promptly pay the same upon demand by Landlord.

9.02  Tenant's Insurance  During the Term, Tenant shall maintain at its own
      expense

      (a)   fire insurance with extended coverage and water damage insurance in
            amounts sufficient to fully cover Tenant's improvements and all
            property in the Premises which is not owned by Landlord, and

      (b)   liability insurance, with Landlord named as an additional insured,
            against claims for death, personal injury and property damage in or
            about the Premises, in amounts which are not less than those from
            time to time acceptable to a prudent tenant in the community in
            which the Building is located, but in no event less than One Million
            Dollars ($1,000,000) for death, illness or injury to any one or more
            persons, and Five Hundred Thousand Dollars ($500,000) for property
            damage, in respect of each occurrence.

      Policies for such insurance shall be in a form and with an insurer
      reasonably acceptable to Landlord, shall require at least fifteen (15)
      days' written notice to Landlord of termination or material alteration
      during the Term, and shall waive, to the extent available from Tenant's
      insurance carriers, any right of subrogation against Landlord. If there
      shall be an additional charge for such waiver, Landlord shall promptly pay
      the same upon demand by Tenant. If requested by Landlord, Tenant shall
      from time to time promptly deliver to Landlord certified copies or other
      evidence of such policies acceptable to Landlord, and evidence
      satisfactory to Landlord that all premiums thereon have been paid and the
      policies are in full force and effect.

ARTICLE 10.00 INJURY TO PERSON OR PROPERTY


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<PAGE>

10.01 Indemnity by Tenant  Tenant shall indemnify and hold harmless Landlord
      from and against every demand, claim, cause of action, judgment and
      expense (including attorney's fees), and all loss and damage arising from

      (a)   any injury or damage to the person or property of Tenant, any other
            tenant in the Project or to any other person in the Project, where
            the injury or damage is caused by negligence or misconduct of
            Tenant, its agents, servants or employees, or of any other person
            entering upon the Premises under express or implied invitation of
            Tenant, or results from the violation of laws or ordinances,
            governmental orders of any kind or of the provisions of this Lease
            by any of the foregoing parties,

      (b)   any loss or damage, however caused, to books, records, files, money,
            securities, negotiable instruments or papers in or about the
            Premises,

      (c)   any loss or damage, resulting from interference with or obstruction
            of deliveries to or from the Premises, and

      (d)   any injury or damage not specified above to the person or property
            of Tenant, its agents, servants or employees, or any other person
            entering upon the Premises under express or implied invitation of
            Tenant, where the injury or damage is caused by any reason other
            than the negligence of misconduct of Landlord, its agents, servants,
            or employees.

10.02 Subrogation  The provisions of this Article 10.00 are subject to the
      waiver of any right of subrogation against Tenant in Landlord's Insurance
      Under Article 9.01 and to the waiver of any right of subrogation against
      Landlord in Tenant's Insurance under Article 9.02.

ARTICLE 11.00 ASSIGNMENT AND SUBLETTING

11.01 Assignment  Tenant may assign this Lease with Landlord's prior written
      consent, which consent will not be unreasonably withheld.

      (a)   to an assignee who is a purchaser of all or substantially all of the
            assets of Tenant, a parent or wholly owned subsidiary of Tenant, a
            company which results from the reconstruction, consolidation or
            merger of Tenant, or a partnership in which Tenant (or not less than
            one-half of the principals thereof) has a greater than 50% interest,
            provided that consent will not be required if the assignment is for
            a good business purpose and not principally for the purpose of
            transferring this Lease and (except for an assignment to a
            subsidiary of Tenant) the net worth of the assignee immediately
            following the assignment is not less than the net worth of the
            Tenant on the Commencement Date or immediately prior to the
            assignment, whichever is greater, or

      (b)   subject to the Article 11.03, to any other assignee who, in
            Landlord's reasonable opinion, will not be inconsistent with the
            dignity, character and standards of the Building and its other
            tenants.

11.02 Subleasing  Tenant may sublet all or any part of the Premises with
      Landlords prior written consent, which consent will not be unreasonably
      withheld.

      (a)   to a sublessee who is a parent or wholly owned subsidiary of Tenant
            and is consistent with the dignity, character and standards of the
            Building and its other tenants, and only for such period as it
            remains a parent or wholly owned subsidiary of Tenant, or

      (b)   subject to Article 11.03, to any other sublessee who, in Landlord's
            reasonable opinion, will not be inconsistent with the dignity,
            character and standards of the Building and its other tenants.

11.03 First Offer

      (a)   If Tenant wishes to assign this Lease or sublet all or any part of
            the Premises (except as set out in Article 11.01(a) or 11.02(a) to a
            named third party, Tenant shall first offer in writing to assign or
            sublet (as the case may be) to Landlord. Such first offer shall
            contain the terms of Tenant's proposed assignment or subletting. Any
            such first offer shall be deemed to be rejected unless within thirty
            (30) days of receipt thereof Landlord delivers written notice of
            acceptance to Tenant.


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<PAGE>

      (b)   If Landlord accepts Tenants offer, Tenant shall assign this Lease to
            Landlord or sublet the proposed space to Landlord without cost, such
            assignment or subletting to be effective on the date and for the
            periods of time set forth in Tenant's notice, provided the effective
            date shall not be sooner than forty-five (45) days after the giving
            of Tenant's offer.

      (c)   Any sublease to Landlord will be on the same terms and conditions as
            provided in this Lease except that

            (i)   Rent shall be the Rent (on a square-foot basis) provided in
                  this Lease, or the rent Tenant's proposed sublessee would have
                  paid, whichever is less,

            (ii)  Landlord may assign the sublease or further sublet all or any
                  part of the space without Tenant's consent, and

            (iii) Landlord may make changes, additions, alterations or
                  improvements (structural or otherwise to the space provided
                  that Landlord shall be required to restore the space to its
                  condition immediately prior to the commencement of the
                  sublease to the same extent as Tenant's proposed sublessee
                  would have been required to do so.

11.04 Limitation  No assignment or sublease which is permitted under this
      Article 11.00 shall be effective until Tenant delivers a copy of the
      executed instrument to Landlord. Except as specifically provided in this
      Article 11.00, Tenant shall not assign or transfer this Lease or any
      interest therein or in any way part with possession of all or any part of
      the Premises, or permit all or any part of the Premises to be used or
      occupied by any other person. Any assignment, transfer or subletting or
      purported assignment, transfer or subletting except as specifically
      provided herein shall be null and void and of no force and effect.
      Landlord shall not be required to consent to an assignment of this Lease
      or a sublease of all or part of the Premises by Tenant to any tenant in
      the Project or with whom Landlord is negotiating in good faith for space
      in the Project. Except as expressly provided herein, the rights and
      interests of Tenant under this Lease shall not be assignable by operation
      of law without Landlord's written consent, which consent may be withheld
      in Landlord's absolute discretion.

11.05 Tenant's Obligations Continue  No assignment, transfer, or subletting (or
      use or occupation of the Premises by any other person) shall in any way
      release or relieve Tenant of its obligations under this Lease unless such
      release or relief is specifically granted by Landlord to Tenant in
      writing, except should Landlord accept Tenant's First Offer under Article
      11.03, then Tenant shall be released on the portion of the Premises taken
      by Landlord.

11.06 Subsequent Consent  Landlord's consent to an assignment; transfer or
      subletting (or use or occupation of the Premises by any other person)
      shall not be deemed to be a consent to any subsequent assignment,
      transfer, subletting, use or occupation.

11.07 Change in Control  As used in this Article 11.00. the term "assignment"
      shall be deemed to include:

      (d)  Any transaction whether issuance of interest in Advanced
           Telecommunications, Inc. or transference of interest of Advanced
           Telecommunications, Inc. (whether stock, partnership interest, or
           otherwise) which would reduce the personal holdings of Cliff
           Williams and Paul Cady to less than 10% interest in Advance
           Telecommunications, Inc.


                                       10
<PAGE>

ARTICLE 12.00 SURRENDER

12.01 Possession  Upon the expiration or other termination of the Term, Tenant
      shall immediately quit and surrender possession of the Premises (including
      all improvements made to the Premises) in substantially the condition in
      which Tenant is required to maintain the Premises, excepting only
      reasonable wear and tear and damage covered by Landlord's insurance under
      Article 9.01. Upon such surrender, all right, title and interest of Tenant
      in the Premises including the improvements made to the Premises shall
      cease.

12.02 Trade Fixtures, Personal Property and Improvements  Subject to Tenant's
      rights under Article 7.05, after the expiration or other termination of
      the Term all of Tenant's trade fixtures and personal property remaining in
      the Premises shall be deemed conclusively to have been abandoned by
      Tenant. All of Tenant's trade fixtures, personal property and improvements
      remaining in the Premises may be appropriated, sold, destroyed or
      otherwise disposed of by Landlord without notice or obligation to
      compensate Tenant or to account therefore, and Tenant shall pay to
      Landlord on written demand all costs incurred by Landlord in connection
      therewith. The obligations of Tenant under this Article 12.02 shall
      survive the expiration or other termination of the Term.

12.03 Merger  The voluntary or other surrender of this Lease by Tenant or the
      cancellation or termination of this Lease by mutual agreement of Tenant
      and Landlord or otherwise shall not work a merger, and shall at Landlord's
      option terminate all or any subleases and subtenancies or operate as an
      assignment to Landlord of all or any subleases or subtenancies.

12.04 Payments After Termination  No payments of money by Tenant to Landlord
      after the expiration or other termination of the Term or after the giving
      of any notice (other than a demand for payment of money) by Landlord to
      Tenant, shall reinstate, continue or extend the Term or make ineffective
      any notice given to Tenant prior to the payment of such money. After the
      service of notice or the commencement of a suit, or after final judgment
      granting Landlord possession of the Premises, Landlord may receive and
      collect any sums of Rent due under the Lease, and the payment thereof
      shall not make ineffective any notice, or in any manner affect any pending
      suit or any judgment therefore obtained.

ARTICLE 13.00 HOLDING OVER

13.01 Month-to-Month Tenancy  If with Landlord's written consent (which consent
      will not be unreasonably withheld if all or part of the Premises is not
      leased to others or required for Landlord's use) Tenant remains in
      possession of the Premises after the expiration or other termination of
      the Term, Tenant shall be deemed to be occupying the Premises on a
      month-to-month tenancy only at a monthly rental equal to the installment
      of Annual Rent in effect for the last month of the Term, plus all other
      Rent which would have been payable under this Lease for such additional
      month or months if the Term had remained in effect, as determined in
      accordance with Article 4.00 or such other rental as is stated in such
      written consent, and such month-to-month tenancy may be terminated by
      Landlord or Tenant on the last day of any calendar month by giving at
      least one month's advance notice of termination to the other.

13.02 Tenancy at Sufferance  If without Landlord's written consent Tenant
      remains in possession of the Premises after the expiration or other
      termination of the Term, Tenant shall promptly surrender the Premises to
      Landlord in accordance with Article 12.00, and shall pay to Landlord for
      each day that Tenant retains possession of the Premises or any portion
      thereof beyond the expiration or other termination of the Term an amount
      equal to two times the Annual Rent in effect on the last day of the Term,
      plus all other Rent which would have been payable under this Lease if the
      Term had remained in effect, as determined in accordance with Article 4.00
      and adjusted and calculated on a per diem basis.

13.03 General  Any month-to-month tenancy or tenancy at sufferance hereunder
      shall be subject to all other terms and conditions of this Lease except
      any right of renewal and nothing contained in this Article 13.00 shall be
      construed to limit or impair any of Landlord's rights of re-entry or
      eviction or constitute a waiver thereof.

ARTICLE 14.00 RULES AND REGULATIONS

14.01 Purpose  The Rules and Regulations in Exhibit C have been adopted by
      Landlord for the, safety, benefit and convenience of all tenants and other
      persons in the Building.


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<PAGE>

14.02 Observance  Tenant shall at all times comply with, and shall cause its
      employees, agents, licensees and invitees to comply with the Rules and
      Regulations from time to time in effect.

14.03 Modification  Landlord may from time to time, for the purposes set out in
      Article 14.01, amend, delete from, or add to the Rules and Regulations,
      provided that any such modification.

      (a)   shall not be repugnant to any other provision of this Lease,

      (b)   shall be reasonable and have general application to all tenants in
            the Building, and

      (c)   shall be effective only upon delivery of a copy thereof to Tenant at
            the Premises.

14.04 Non-Compliance  Landlord shall endeavor to secure compliance by all
      tenants in the Building with the Rules and Regulations from time to time
      in effect, but shall not be responsible to Tenant for failure of any
      person to comply with such Rules and Regulations.

ARTICLE 15.00 EMINENT DOMAIN

15.01 Taking of Premises  If during the Term all of the Premises shall be taken
      for any public or quasi-public use under any statute or by right of
      eminent domain, or purchased under threat of such taking, this Lease shall
      automatically terminate on the date on which the condemning authority
      takes possession of the Premises (hereinafter called the "date of such
      taking").

15.02 Partial Taking of Building  If during the Term only part of the Building
      is taken or purchased as set out in Article 15.01, then

      (a)   if in the reasonable opinion of Landlord substantial alteration or
            reconstruction of the Building is necessary or desirable as a result
            thereof, whether or not the Premises are or may be affected,
            Landlord shall have the right to terminate this Lease by giving
            Tenant at least thirty (30) days' written notice of such
            termination, and

      (b)   if more than one-third of the number of square feet in the Premises
            is included in such taking or purchase, Landlord and Tenant shall
            each have the right to terminate this Lease by giving the other at
            least thirty (30) days' written notice thereof.

      If either party exercises its right of termination hereunder, this Lease
      shall terminate on the date stated in the notice, provided, however, that
      no termination pursuant to notice hereunder may occur later than sixty
      (60) days after the date of such taking.

15.03 Surrender  On any such date of termination under Article 15.01 or 15.02,
      Tenant shall immediately surrender to Landlord the Premises and all
      interests therein under this Lease. Landlord may re-enter and take
      possession of the Premises and remove Tenant therefrom, and the Rent shall
      abate on the date of termination, except that if the date of such taking
      differs from the date of termination, Rent shall abate on the former date
      in respect of the portion taken. After such termination, and on notice
      from Landlord stating the Rent then owing, Tenant shall forthwith pay
      Landlord such Rent.

15.04 Partial Taking of Premises  If any portion of the Premises (but less than
      the whole thereof) is so taken, and no rights of termination herein
      conferred are timely exercised, the Term of this Lease shall expire with
      respect to the portion so taken on the date of such taking. In such event
      the Rent payable hereunder with respect to such portion so taken shall
      abate on such date, and the Rent thereafter payable with respect to the
      remainder not so taken shall be adjusted pro rata by Landlord in order to
      account for the resulting reduction in the number of square feet in the
      Premises.

15.05 Awards  Upon any such taking or purchase, Landlord shall be entitled to
      receive and retain the entire award or consideration for the affected
      lands and improvements, and Tenant shall not have nor advance any claim
      against Landlord or the condemning authority for the value of its property
      or its leasehold estate or the unexpired Term of this Lease, or for costs
      of removal or relocation, or business interruption expenses or any other
      damages arising out of such taking or purchase, and Tenant hereby assigns
      to Landlord all of its interest to such award and agrees to execute any
      documents that may be required to facilitate collection thereof by
      Landlord. Nothing herein shall give Landlord any interest in or preclude
      Tenant from seeking and recovering on its own account from the condemning
      authority any separate award or compensation attributable to the taking or
      purchase of Tenant's trade fixtures or personal property, or the removal
      or relocation of its business and effects, or the


                                       12
<PAGE>

      interruption of its business, provided such award shall be made in
      addition to, and not result in a reduction of, the award otherwise made to
      Landlord. If any such award made or compensation paid to either party
      specifically includes an award or amount for the other, the party first
      receiving the same shall promptly account therefore to the other.

ARTICLE 16.00 DAMAGE BY FIRE OR OTHER CASUALTY

16.01 Limited Damage to Premises  If all or part of the Premises are rendered
      untenantable by damage from fire or other casualty, in the reasonable
      opinion of an architect selected by Landlord and approved by Tenant, which
      approval will not be unreasonably withheld, cannot be substantially
      repaired under applicable laws and governmental regulations within one
      hundred eighty (180) days from the date of such casualty (employing normal
      construction methods without overtime or other premium), then either
      Landlord or Tenant may elect to terminate this Lease as of the date of
      such casualty by written notice delivered to the other not more than
      twenty (20) days after receipt of such architect's opinion, failing which
      Landlord shall forthwith at its own expense repair such damage other than
      damage to improvements, trade fixtures or personal property which do not
      belong to Landlord.

16.02 Major Damage to Premises  If all or part of the Premises are rendered
      untenantable by damage from fire or other casualty, in the reasonable
      opinion of an architect selected by Landlord and approved by Tenant, which
      approval will not be unreasonably withheld, cannot be substantially
      repaired under applicable laws and governmental regulations within one
      hundred eighty (180) days from the date of such casualty (employing normal
      construction methods without overtime or other premium), then either
      Landlord or Tenant may elect to terminate this Lease as of the date of
      such casualty by written notice delivered to the other not more than
      twenty (20) days after receipt of such architect's opinion, failing which
      Landlord shall forthwith at its own expense repair such damage other than
      damage to improvements, trade fixtures or personal property which do not
      belong to Landlord.

16.03 Abatement  If Landlord is required to repair damage to all or part of the
      Premises under Article 16.01 or 16.02, the Rent payable by Tenant
      hereunder shall be proportionately reduced to the extent that the Premises
      are thereby rendered unusable by Tenant in its business, from the date of
      such casualty until five (5) days after completion by Landlord of the
      repairs to the Premises (or the part thereof rendered untenantable) or
      until Tenant again uses the Premises (or the part thereof rendered
      untenantable) in its business, whichever first occurs.

16.04 Major Damage to Building  If all or a substantial part (whether or not
      including the Premises) of the Building is rendered untenantable by damage
      from fire or other casualty to such a material extent that in the
      reasonable opinion of Landlord the Building must be totally or partially
      demolished, whether or not to be reconstructed in whole or in part,
      Landlord may elect to terminate this Lease as of the date of such casualty
      (or on the date of notice if the Premises are unaffected by such casualty)
      by written notice delivered to Tenant not more than sixty (60) days after
      the date of such casualty.

16.05 Limitation on Landlord's Liability  Except as specifically provided in
      this Article 16.00, there shall be no reduction of Rent and Landlord shall
      have no liability to Tenant by reason of any injury to or interference
      with Tenant's business or property arising from fire or other casualty,
      howsoever caused or from the making of any repairs resulting therefrom in
      or to any portion of the Building or the Premises. Notwithstanding
      anything contained herein, Rent payable by Tenant hereunder shall not be
      abated if the damage is caused by any act or omission of Tenant, its
      agents, servants, employees or any other person entering upon the Premises
      under express or implied invitation of Tenant.

ARTICLE 17.00 TRANSFERS BY LANDLORD

17.01 Sales, Conveyance and Assignment  Nothing in this Lease shall restrict the
      right of Landlord to sell, convey, assign or otherwise deal with the
      Building, subject only to the rights of Tenant under this Lease.

17.02 Effect of Sale, Conveyance or Assignment  A sale, conveyance or assignment
      of the Building shall operate to release Landlord from liability from and
      after the effective date thereof upon all of the covenants, terms and
      conditions of this Lease, express or implied, except as such may relate to
      the period prior to such effective date, and Tenant shall thereafter look
      solely to Landlord's successor in interest in and to this Lease. This
      Lease shall not be affected by any such sale, conveyance or assignment,
      and Tenant shall attorn to Landlord's successor in interest thereunder.


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<PAGE>

17.03 Subordination  This Lease is and shall be subject and subordinate in all
      respects to any and all ground or underlying leases, and to all mortgages
      and deeds of trust which may now or hereafter affect any of such leases or
      the Building or Land, and to all renewals, modifications, consolidations,
      replacements and extensions thereof.

17.04 Attornment  Subject to Article 17.05, if the interest of Landlord is
      transferred to any person (herein called "Purchaser") by reason of
      foreclosure or other proceedings for enforcement of any such mortgage or
      deed of trust, or by delivery of a deed in lieu of such foreclosure or
      other proceedings, Tenant shall immediately and automatically attorn to
      Purchaser.

17.05 Nondisturbance  No attornment by Tenant under Article 17.04 shall be
      effective unless, before the date of transfer to Purchaser, Purchaser
      delivers to Tenant a written undertaking, binding upon Purchaser and
      enforceable by and for the benefit of Tenant under applicable law, that
      this Lease and Tenant's rights hereunder shall continue undisturbed while
      Tenant is not in default despite such enforcement proceedings and
      transfer.

17.06 Effect of Attornment  Upon attornment under Article 17.04, this Lease
      shall continue in full force and effect as a direct lease between
      Purchaser and Tenant, upon all of the same terms, conditions and covenants
      as are set forth in this Lease except that, after such attornment,
      Purchaser shall not be

      (a)   liable for any act or omission of Landlord, or

      (b)   subject to any offsets or defenses which Tenant might have against
            Landlord, or

      (c)   bound by any prepayment by Tenant of more than one month's
            installment of Rent, or by any previous modification of this Lease,
            unless such prepayment or modification shall have been approved in
            writing by Purchaser or any predecessor in interest except Landlord.

17.07 Execution of Instruments  The subordination and attornment provisions of
      this Article 17.00 shall be self-operating and, except as set out in
      Article 17.05, no further instrument shall be required. Nevertheless,
      Tenant, on request by and without cost to Landlord or any successor in
      interest, shall promptly execute and deliver to Landlord any and all
      instruments further evidencing such subordination and (where applicable
      hereunder) attornment.

ARTICLE 18.00 NOTICES, ACKNOWLEDGEMENTS, AUTHORITIES FOR ACTION

18.01 Notices  Any notice from Landlord to Tenant shall be in writing and shall
      be deemed duly served if delivered personally to a responsible employee of
      Tenant, or if mailed by registered or certified mail addressed to Tenant
      at the Premises (whether or not Tenant has departed from, vacated or
      abandoned the same). Any notice from Tenant to Landlord shall be in
      writing and shall be deemed duly served if mailed by registered or
      certified mail addressed to Landlord at the place from time to time
      established for the payment of Rent. Any notice shall be deemed to have
      been given at the time of personal delivery or, if mailed, three (3) days
      after the date of mailing thereof. Either party shall have the right to
      designate by notice, in the manner above set forth, a different address to
      which notices are to be mailed.

18.02 Acknowledgements  Each of the parties hereto shall at any time and from
      time to time upon not less than fifteen (15) days' prior notice from the
      other execute, acknowledge and deliver a written statement certifying

      (a)   that this Lease is in full force and effect, subject only to such
            modifications (if any) as may be set out therein,

      (b)   that Tenant is in possession of the Premises and paying Rent as
            provided in this Lease,

      (c)   the dates (if any) to which Rent is paid,

      (d)   that there are not, to such party's knowledge, any uncured defaults
            on the part of the other party hereunder, or specifying such
            defaults if any are claimed,

      (e)   as to such other matters pertaining to this Lease as the other party
            may reasonably request.


                                       14
<PAGE>

      Any such statement may be relied upon by any prospective transferee or
      encumbrancer of all or any portion of the Building, or any assignee of any
      such persons. If Tenant fails to timely deliver such statement, Tenant
      shall be deemed to have acknowledged that this Lease is in full force and
      effect, without modification except as may be represented by Landlord, and
      that there are no uncured defaults in Landlord's performance.

18.03 Authorities for Action  Landlord may act in any matter provided for herein
      through its property manager and any other person who shall from time to
      time be designated by Landlord by notice to Tenant. Tenant shall designate
      in writing one or more persons to act on its behalf in any matter provided
      for herein and may from time to time change, by notice to Landlord, such
      designation. In the absence of any such designation, the person or persons
      executing this Lease for Tenant shall be deemed to be authorized to act on
      behalf of Tenant in any matter provided for herein.

ARTICLE 19.00 DEFAULT

19.01 Interest and Costs  Tenant shall pay to Landlord interest at a rate equal
      to the lesser of 1 1/2% per month, or the maximum rate permitted by
      applicable law, upon all Rent required to be paid hereunder from the due
      date for payment thereof until the same is fully paid and satisfied.
      Tenant shall indemnify Landlord against all costs and charges (including
      legal fees) reasonably incurred in enforcing Tenant's payment of Rent, and
      in obtaining possession of the Premises after default of Tenant or upon
      expiration or earlier termination of the Term of this Lease, and in
      enforcing any covenant, proviso or agreement of Tenant herein contained.

19.02 Right of Landlord to Perform Covenants  All covenants and agreements to be
      performed by Tenant under any of the terms of this Lease shall be
      performed by Tenant, at Tenant's sole cost and expense, and without any
      abatement of Rent. If Tenant shall fail to perform any act on its part to
      be performed hereunder, and such failure shall continue for ten (10) days
      after notice thereof from Landlord (or without notice in an emergency),
      Landlord may (but shall not be obligated to) perform such act without
      waiving or releasing Tenant from any of its obligations or liabilities
      relative thereto. All sums paid or costs incurred by Landlord in so
      performing such acts under this Article 19.02, together with interest
      thereon at the rate set out in Article 19.01 from the date each such
      payment was made or each such cost incurred by Landlord, shall be payable
      by Tenant to Landlord on demand.


                                       15
<PAGE>

19.03 Events of Default  The rights of Tenant under this Lease are subject to
      the limitations that if

      (a)   Tenant files a voluntary petition in bankruptcy or insolvency, or is
            adjudicated a bankrupt or insolvent, or files a petition or answer
            seeking any relief under any bankruptcy act or other similar
            applicable law, or makes an assignment for the benefit of creditors
            or seeks or consents in the appointment of any trustee, receiver, or
            liquidator of Tenant's business or property, or

      (b)   within sixty (60) days after the commencement of any proceeding
            against Tenant seeking any relief under any bankruptcy act or
            similar applicable law, such proceeding has not been dismissed, or
            if, within sixty (60) days after the appointment of any trustee,
            receiver or liquidator of Tenant's business or property without the
            consent of Tenant, such appointment has not been vacated or
            otherwise discharged, or if any execution or attachment shall be
            issued against Tenant's business or property pursuant to which the
            Premises may be taken or occupied, or

      (c)   part or all of the Rent is not paid when due and such default
            continues for five (5) days after the due date thereof, or

      (d)   Tenant's interest in this Lease devolves or passes to any party
            other than Tenant, by operation of law or otherwise, except with the
            prior written consent of Landlord, or

      (e)   the Premises are vacated or abandoned or if Tenant fails to take
            occupancy of the Premises within thirty (30) days after the
            Commencement Date, except with the prior written consent of
            Landlord, or

      (f)   Tenant fails to observe or perform any other term, covenant or
            condition of this Lease on Tenant's part to be observed or
            performed, other than the payment of Rent, and fails to remedy such
            default within ten (10) days after notice by Landlord to Tenant of
            such default or, if such default within ten (10) days after notice
            by Landlord to Tenant of such default or, if such default is of such
            a nature that it cannot be completely remedied within said period,
            Tenant fails to promptly, upon the giving of such notice, advise
            Landlord of Tenant's intent to institute all steps necessary to
            remedy the default and promptly institute and thereafter diligently
            prosecute to completion all steps necessary to remedy the default,
            and complete such remedy within a reasonable time after the giving
            of such notice by Landlord and in any event prior to such time as
            would cause a default under any mortgage or underlying lease on the
            Building or Land,

      then in any of said events Landlord may terminate this Lease by giving at
      least three (3) days' prior written notice to Tenant and this Lease shall
      terminate upon the expiration of that notice period as though that date
      were the Expiration Date, but Tenant shall remain liable for damages as
      provided in this Article 19.00.

19.04 Re-Entry and Remedies  If part or all of the Rent is not paid when due and
      such default continues for five (5) days after notice from Landlord to
      Tenant or of this Lease is terminated as provided in Article 19.03,

      (a)   Landlord may immediately or at any time thereafter re-enter the
            Premises or any part thereof in accordance with applicable law by
            summary proceedings or otherwise, and may repossess the Premises and
            dispossess Tenant and any other persons from the Premises and remove
            Tenant's trade fixtures and personal property from the Premises,
            without liability for damage thereto, and in no event shall re-entry
            be deemed an acceptance of surrender of this Lease, and

      (b)   Landlord may from time to time (but shall not be obligated to) relet
            the whole or any part of the Premises on such terms and at such
            rentals as Landlord deems advisable. Landlord may make such changes,
            additions, improvements and repairs to the Premises as Landlord
            deems advisable without affecting Tenant's liability under this
            Lease.

19.05 Waiver  Tenant hereby expressly waives any and all rights of redemption or
      reinstatement granted by or under any present or future laws in the event
      of Tenant being evicted or dispossessed for any cause, or in the event of
      Landlord obtaining possession of the Premises, by reason of the violation
      by Tenant of any of the terms, covenants or conditions of this Lease or
      otherwise.

19.06 Payments  If this Lease is terminated or if Landlord re-enters the
      Premises under this Article 19.00:

      (a)   Tenant shall pay to Landlord all Rent up to the time of re-entry or
            termination, whichever is later,


                                       16
<PAGE>

      (b)   Landlord may retain all monies, if any, paid by Tenant to Landlord,
            whether as advance rent, security or otherwise, but such monies
            shall be credited by Landlord against any Rent due at the time of
            such termination or re-entry or, at Landlord's option, against any
            damages payable by Tenant,

      (c)   Tenant shall pay to Landlord all expenses incurred by Landlord in
            terminating, re-entering and re-letting, including all repossession
            costs, brokerage and legal fees and costs of preparing the Premises
            for reletting, and

      (d)   (i)   Tenant shall pay to Landlord, as damages, any deficiency
                  between the Rent for the period which otherwise would have
                  constituted the unexpired portion of the Term and the
                  payments, if any, received by Landlord from other tenants in
                  the Premises, such deficiency to be paid at the times and in
                  the manner as Rent is payable under Article 4.00, and Landlord
                  shall be entitled to bring a suit to recover each deficiency
                  as the same shall arise, or at Landlord's election, bring
                  suits from time to time.

            (ii)  If elected by Landlord, at or after re-entry or termination,
                  Tenant shall pay Landlord on demand as liquidated and final
                  damages for lost Rent and not as a penalty, a sum equal to the
                  amount by which the Rent payable hereunder for the period to
                  the Expiration Date from the latest of the date of termination
                  of this Lease, the date of re-entry or the date through which
                  monthly deficiencies shall have been paid (conclusively
                  presuming the Occupancy Costs to be the same as payable for
                  the Fiscal Year immediately preceding such termination or
                  re-entry) exceeds the then fair rental value of the Premises
                  for the same period, discounted at the rate of 7% per annum to
                  present worth. If, before presentation of proof of such
                  liquidated damages to any court, commission or tribunal, all
                  or part of the Premises are relet by Landlord for all or part
                  of the period which otherwise would have constituted the
                  unexpired portion of the Term, the amount of rent upon such
                  reletting shall be deemed to be the fair rental value for the
                  part or whole of the Premises during the term of the
                  reletting.

            (iii) In no event shall Tenant be entitled to receive any excess of
                  any payments received by Landlord from a reletting of the
                  Premises over the sums payable by Tenant to Landlord
                  hereunder; and

            (iv)  If the Premises or any part thereof should be relet in
                  combination with other space, then proper apportionment on a
                  square foot area basis shall be made of the rent received from
                  such reletting and the expenses of reletting.

      Nothing herein shall be construed as limiting or precluding the recovery
      by Landlord against Tenant of any sums or damages to which, in addition to
      the damages set out in this Article 19.06, Landlord may lawfully be
      entitled by reason of any default hereunder by Tenant.

19.07 Remedies  Cumulative Each right of Landlord provided for in this Lease
      shall be cumulative and shall be in addition to every other right provided
      for in this Lease or existing at law or in equity, and the exercise by
      Landlord of any one or more of such rights shall not preclude the
      simultaneous or later exercise by Landlord of any other rights provided
      for in this Lease or existing at law or in equity.

ARTICLE 20.00 MISCELLANEOUS

20.01 Relationship of Parties  Nothing contained in this Lease shall create any
      relationships between the parties hereto other than that of Landlord and
      tenant, and it is acknowledged and agreed that Landlord does not in any
      way or for any purpose become a partner of Tenant in the conduct of its
      business, or a joint venturer or a member of a joint or common enterprise
      with Tenant.

20.02 Name of Building  Landlord shall have the right, after thirty (30) days'
      notice to Tenant, to change the name, number and designation of the
      Building, during the Term without liability to Tenant.

20.03 Applicable Law and Construction  This Lease shall be governed by and
      construed under the laws of Minnesota and its provisions shall be
      construed as a whole according to their common meaning and not strictly
      for or against Landlord or Tenant. The words Landlord and Tenant shall
      include the plural as well as the singular. If this Lease is executed by
      more than one tenant, Tenant's obligations hereunder shall be joint and
      several obligations of such executing tenants. Time is of the essence of
      this Lease and each of its provisions. The captions of the Articles are
      included for convenience only, and shall have not effect upon the
      construction or interpretation of this Lease.


                                       17
<PAGE>

20.04 Entire Agreement  If there are any terms and conditions which at the date
      of execution of this Lease are additional or supplemental to those set out
      on the first 18 pages and in Exhibits A, B and C, such terms and
      conditions are contained in Exhibit D (if any) attached hereto as part of
      this Lease. This Lease contains the entire agreement between the parties
      hereto with respect to the subject matter of this Lease. Tenant
      acknowledges and agrees that it has not relied upon any statement,
      representation, agreement or warranty except such as are set out in this
      Lease.

20.05 Amendment or Modification  Unless otherwise specifically provided in this
      Lease, no amendment, modification, or supplement to this Lease shall be
      valid or binding unless set out in writing and executed by the parties
      hereto in the same manner as the execution of this Lease.

20.06 Construed Covenants and Severability  All of the provisions of this Lease
      are to be construed as covenants and agreements as though the words
      importing such covenants and agreements were used in each separate Article
      hereof. Should any provision of this Lease be or become invalid, void,
      illegal or not enforceable, it shall be considered separate and severable
      from the Lease and the remaining provisions shall remain in force and be
      binding upon the parties hereto as though such provision had not been
      included.

20.07 No Implied Surrender or Waiver  No provisions of this Lease shall be
      deemed to have been waived by Landlord unless such waiver is in writing
      signed by Landlord. Landlord's waiver of a breach of any term, covenant or
      condition of this Lease shall not prevent a subsequent act, which would
      have originally constituted a breach, from having all the force and effect
      of any original breach. Landlord's receipt of Rent with knowledge of a
      breach by Tenant of any term, covenant or condition of this Lease shall
      not be deemed a waiver of such breach. Landlord's failure to enforce
      against Tenant or any other tenant in the Building any of the Rules and
      Regulations made under Article 14.00 shall not be deemed a waiver of such
      Rules and Regulations. No act or thing done by Landlord, its agents or
      employees during the Term shall be deemed an acceptance of a surrender of
      the Premises, and no agreement to accept a surrender of the Premises shall
      be valid, unless in writing signed by Landlord. The delivery of keys to
      any of Landlord's agents or employees shall not operate as a termination
      of this Lease or a surrender of the Premises. No payment by Tenant, or
      receipt by Landlord, of a lesser amount than the Rent due hereunder shall
      be deemed to be other than on account of the full Rent due, nor shall any
      endorsement or statement on any check or any letter accompanying any
      check, or payment of Rent, be deemed an accord and satisfaction, and
      Landlord may accept such check or payment without prejudice to Landlord's
      right to recover the balance of such Rent or pursue any other remedy
      available to Landlord.

20.08 Successors Bound  Except as otherwise specifically provided, the
      covenants, terms, and conditions contained in this Lease shall apply to
      and bind the heirs, successors, executors, administrators and assigns of
      the parties hereto.

ARTICLE 21.00 RELOCATION BY TENANT

21.01 Landlord, at its sole expense, on at least one hundred eighty (180) days
      prior written notice, may require Tenant to move from the Premises to
      other space of comparable size and decor in order to permit Landlord to
      consolidate the space leased to Tenant with other adjoining space leased
      or to be leased to another tenant. Provided, however, that in the event of
      receipt of any such notice, Tenant by written notice to Landlord may elect
      not to move to other space and in lieu thereof terminate this Lease,
      effective ninety (90) days after the date of the original notice of
      relocation by Landlord. In the event of any such relocation, within the
      Project, Landlord will pay all expenses of preparing and decorating the
      new premises so that they will be substantially similar to the Premises
      from which Tenant is moving and Landlord will also pay the expense of
      moving Tenant's furniture and equipment to the relocated premises. In such
      event this Lease and each and all of the terms and covenants and
      conditions hereof shall remain in full force and effect and thereupon be
      deemed applicable to such new space.


                                       18
<PAGE>

IN WITNESS OF THIS LEASE Landlord and Tenant have properly executed it as of the
date set out on page one.

LANDLORD:                                    TENANT:

ST. PAUL PROPERTIES, INC.                    Advanced Telecommunications, Inc.

By: /s/ R. William Inserra                         By: /s/ Cliff Williams
    ------------------------------                     -------------------------
R. William Inserra                           Its: CEO
Vice President Asset Management                   Cliff Williams
                                                  ------------------------------
                                                  (Type name)

9-3-96
----------------------------------
Date Executed
                                             By:
                                                --------------------------------
                                             Its:
                                                 -------------------------------

                                                 -------------------------------
                                                     (Type name)


                                                 -------------------------------
                                                 Witness to the signature of
                                                 Tenant if not incorporated.


                                                 -------------------------------
                                                 Date Executed


                                       19
<PAGE>

                                                                       Exhibit A

                              [FLOOR PLAN OMITTED]

                           PEAVEY BUILDING - FLOOR 4

<PAGE>

BAKER CENTER                                                           EXHIBIT B
Office Space

                                PEAVEY BUILDING
                            730 SECOND AVENUE SOUTH
                          MINNEAPOLIS, MINNESOTA 55402

SECTION 1.00 WORDS AND PHRASES

1.01  Definitions  In the Lease, including this Exhibit:

      (a)   "Architect" means that firm of professional architects or engineers
            as Landlord may from time to time engage for preparation of
            construction drawings for the Building or for general supervision of
            architectural and engineering aspects and operations of the Building
            and includes any consultant(s) from time to time appointed by
            Landlord or the Architect whenever such consultants(s) is acting
            within the scope of his or her appointment and specialty.
      (b)   "Land" means those lands located in Hennepin County, Minnesota,
            described as:
                  Lots 9,10 and 11, and the Southeasterly, 10 feet of the
                  Southwesterly 90 feet of Lot 8, Auditors Subdivision No. 178
                  Hennepin County, Minnesota.
      (c)   "Project" means those portions of those lands, in Hennepin County,
            Minnesota, described as:
                  Lots 1, 2, 3, 4, 5, 6, 7, 8, 9,10 and 11, Auditor's
                  Subdivision No. 178 Hennepin County, Minnesota,
            from time to time owned or leased by Landlord, and the developments
            and improvements from time to time constructed on those portions.
      (d)   "Building" means the building in which the Premises are located,
            being those portions of the Project on the Land.
      (e)   "Investors Building" means those portions of the Project on those
            lands in Hennepin County, Minnesota, described as:
                  Lots 6, 7 and 8, Auditor's Subdivision 178 Hennepin County,
                  Minnesota, except the Southeasterly 10 feet of the
                  Southwesterly 90 feet of said Lot 8.
      (f)   "Roanoke Building" means those portions of the Project on those
            lands located in Hennepin County, Minnesota, described as:
                  Lots 3, 4 and 5, Auditor's Subdivision No. 178 Hennepin
                  County, Minnesota.
      (g)   "Baker Building" means those portions of the Project on those lands
            located in Hennepin County, Minnesota, described as:
                  Lots 1 and 2, Auditor's Subdivision No. 178 Hennepin County,
                  Minnesota.
      (h)   "Rentable Components" means the Building, Investors Building,
            Roanoke Building and Baker Building, in each case excluding Common
            Areas and Parking Facilities.
      (i)   "Parking Facilities" means those portions of the Project from time
            to time designated by Landlord for vehicular parking.
      (j)   "Common Areas" means those portions of the Project (excluding
            Parking Facilities) not leased or designated for lease to tenants
            that Landlord provides for use in common by Landlord, Tenant, and
            other tenants of the Project (or by their respective sublessees,
            agents, employees, customers or licensees), whether or not those
            areas are open to the general public, and includes any fixtures,
            chattels, systems, decor, signs, facilities, or


                                       1
<PAGE>

            landscaping contained, maintained, or used in connection with those
            areas, and is deemed to include the city sidewalks adjacent to the
            Land and adjoining lands and any pedestrian walkway system (either
            above or below ground) or other facility open to the general public
            in respect of which Landlord is from time to time subject to
            obligations arising from the Project, but does not include any space
            on office floors designated by Landlord for use in common by tenants
            and other persons.
      (k)   "Delivery Facilities" means those portions of the Common Areas from
            time to time designated by Landlord as facilities to be used in
            common by Landlord, tenants in the Project, and others for purposes
            of loading, unloading, delivery, dispatch, and holding of
            merchandise, goods and materials entering or leaving the Project and
            giving vehicular access to those portions of the Project.
      (l)   "Section" means a section of this Exhibit B.

1.02  Normal Business Hours  Except as otherwise specifically provided in this
      Lease, normal business hours for the Building shall be from 8:00 a.m. to
      6:00 p.m. Monday through Friday, and 8:00 a.m. to 1:00 p.m. Saturday,
      excluding days which are legal or statutory holidays in the jurisdiction
      in which the Building is located.

SECTION 2.00 DETERMINATION OF OCCUPANCY COSTS

2.01  Definitions  In this Section 2.00:

      (a)   "Tax Cost" means the Taxes accruing in respect of the calendar year
            in which the Fiscal Year begins, less that part of those Taxes
            attributable to the Parking Facilities.
      (b)   "Taxes" means the aggregate of all taxes, rates, charges, levies and
            assessments payable by Landlord and imposed by any competent
            authority upon or in respect of the Land and all improvements on the
            Land, including any tax imposed on the capital invested in the Land
            or improvements on the Land. In determining Taxes, any corporate
            income, profits, excess profits and business tax imposed upon the
            income of Landlord and any other impost of a personal nature charged
            or levied against the Landlord shall be excluded, except to the
            extent that it is levied in lieu of or as a substitute for increases
            in taxes, rates, charges or assessments in respect of the Land or
            any improvements on the Land.
      (c)   "HVAC Cost" means a percentage of the costs in the Fiscal Year for
            the operation, repair and maintenance of the system for heating,
            ventilating and cooling the Project as established by Landlord from
            time to time on a fair and equitable basis which reflects load and
            hours of operation.
      (d)   "Common Areas Costs" means all net costs, charges and expenses in
            respect of a Fiscal Year which are directly attributable to the
            operation, repair and maintenance of the Common Areas, including
            without limitation HVAC Cost.
      (e)   "Project Costs" means all net costs, charges and expenses in respect
            of a Fiscal Year which are directly attributable to the operation,
            repair and maintenance of the Project, but which are not
            attributable solely to the operation, repair or maintenance of the
            Common Areas, Parking Facilities, or any Rentable Component.
      (f)   "Square Feet in the Premises" means the number of square feet set
            out in Article 1.01(l) or 1.01(n) of the Lease, which for office
            tenants includes the number of square feet of unallocated space in
            the Building set out in Article 1.01(l) of the Lease.
      (g)   "Square Feet in the Building" means 307,245 square feet, being the
            aggregate of the rentable areas of office space (on a single-tenancy
            floor basis) and retail and service store space in the Building. If
            from time to time there is a material change in the rentable areas
            of the Building, Square Feet in the Building shall (until any
            further change) mean the number of square feet in the Building
            determined on completion of such change on the basis set out in
            Sections 3.01 and 3.03.


                                       2
<PAGE>

2.02  Occupancy Costs  Occupancy Costs for any Fiscal Year shall be an amount
      equal to the Operating Cost in respect of that Fiscal Year multiplied by
      the Square Feet in the Premises.

2.03  Determination Of Operating Cost  "Operating Cost" means an amount per
      square foot (calculated to the nearest tenth of a cent) established in
      accordance with generally accepted accounting principles and confirmed in
      a certificate of Landlord, and equal to the sum of the following costs in
      respect of a Fiscal Year, divided by the Square Feet in the Building:
      (a)   all net costs, charges and expenses directly attributable to the
            operation, repair and maintenance of the Building (excluding Common
            Areas and Parking Facilities), including, without limitation, Tax
            Cost and HVAC Cost, and
      (b)   a portion of the Common Areas Costs as established by Landlord from
            time to time on a fair and equitable basis, and
      (c)   that proportion of Project Costs which the gross area of the
            Building (excluding Common Areas and Parking Facilities) is of the
            aggregate gross area of the Rentable Components.
      Operating Cost under this Section 2.03 includes all net expenses properly
      allocable to the Fiscal Year for any capital improvement or structural
      repair incurred to reduce or limit increases in Operating Cost, or
      required by Landlord's insurance carrier or by the laws, rules,
      regulations or orders of any governmental or quasi-governmental authority
      having jurisdiction, which expenses shall be amortized at applicable
      interest rates over the useful capital life of the capital improvement or
      structural repair. If Landlord manages the Building or other applicable
      portion of the Project, Operating Cost under this Section 2.03 also
      includes an imputed management fee commensurate with the then-current
      Minneapolis-Saint Paul metropolitan market for management services.

2.04  Limitation on Operating Cost  In determining Operating Cost, the cost (if
      any) of the following shall be excluded except as specifically provided in
      Section 2.03:
      (a)   major structural repairs to the Project,
      (b)   improvements, additions or alterations to the Project,
      (c)   repair and replacement resulting from inferior or deficient
            workmanship, materials or equipment in the initial construction of
            the Project or for which Landlord is reimbursed by insurers,
      (d)   ground rent (if any), depreciation, amortization and interest on and
            capital retirement of debt,
      (e)   operation, repair and maintenance which is attributable solely to.
            the Parking Facilities or to any Rentable Component other than the
            Building, and
      (f)   leasing commissions.

2.05    When Services Are Not Provided  Notwithstanding Section 2.03, when and
        if any service which is normally provided by Landlord to some tenants of
        the building in their premises
        (a)  is not provided by Landlord in the Premises under the specific
             terms of the Lease, in determining Occupancy Costs for Tenant, the
             cost of that service (except as it relates to Common Areas, those
             spaces on office floors designated by Landlord for use in common by
             tenants and other persons in the Building, and janitorial services)
             shall be excluded, and
        (b)  is not provided by Landlord in a significant portion of the
             Building, in determining Occupancy Costs for Tenant, the cost of
             that service shall be divided by the number of square feet in the
             Building in which Landlord provides that service, determined on the
             basis set out in Sections 3.01 and 3.03.

2.06    Shared Facilities, Services and Utilities  If any facilities, services
        or utilities:
        (a)  for the operation, repair and maintenance of the Project are
             provided from another building or other buildings, owned or
             operated by Landlord or an affiliate of Landlord, or


                                       3
<PAGE>

        (b)  for the operation, repair and maintenance of another building or
             other buildings owned or operated by Landlord or an affiliate of
             Landlord are provided from the Project,
        the net costs, charges and expenses for those facilities, services and
        utilities shall, for the purpose of Section 2.03, be allocated by
        Landlord between the Project and the other building or among the Project
        and the other buildings on a fair and equitable basis.

2.07    Credit to Common Areas  Landlord shall use reasonable efforts to recover
        where circumstances so permit an equitable share of the cost of
        operating and maintaining Common Areas from owners or occupants of
        neighboring properties and others who benefit from the use of the Common
        Areas, and shall credit any recovery to the gross cost before
        determination of Common Areas Costs.

2.08    Occupancy Adjustment  If the Project is not fully leased and occupied in
        any Fiscal Year, appropriate adjustments shall be made in determining
        Occupancy Costs under this Section 2.00 so that Occupancy Costs shall be
        as though the Project had been fully leased and occupied during that
        Fiscal Year.

2.09    Partial Fiscal Year  If the Term commences after the beginning of or
        terminates before the end of a Fiscal Year, any amount payable by Tenant
        under Section 2.02 shall be adjusted accordingly.

SECTION 3.00 DETERMINATION OF SQUARE FEET IN THE PREMISES

3.01    Office Space -- Single Tenancy Floors  For the purposes of this Lease,
        the number of square feet of office space in the Premises on a
        single-tenancy floor in the Building (if any) shall be calculated from
        dimensioned Architects drawings to the inside face of the glass in the
        permanent exterior building walls (whether or not the glass extends to
        the floor) or to the inside finish of those walls if they contain no
        glass. It shall include all space within exterior building walls except
        for stairs (other than stairs exclusively serving a tenant occupying
        offices on more than one floor), elevator shafts, flues, pipe shafts,
        vertical ducts, and other vertical risers which penetrate the floor and
        their enclosing walls. No deduction shall be made for washrooms, janitor
        closets, air conditioning rooms, fan closets, or for electrical or
        telephone cupboards within and servicing only that floor or servicing a
        single tenant on more than one floor, or for any other rooms, corridors,
        or areas available to the tenant on that floor for its use, furnishings,
        or personnel, or for any columns located wholly or partially within the
        space, or for any enclosures around the periphery of the Building used
        for the purpose of heating, ventilating or cooling.

3.02    Office Space -- Multiple-Tenancy Floors  For the purposes of this Lease,
        the number of square feet of office space in the Premises on a
        multiple-tenancy floor in the Building (if any) shall be calculated from
        dimensioned architect's drawings to the inside finish of permanent
        exterior building walls or the inside face of the glass as described in
        Section 3.01, to the face of permanent interior walls and to the center
        line of demising partitions. No deductions shall be made for any columns
        located wholly or partially within the space, or for any enclosures
        around the periphery of the Building used for the purpose of heating,
        ventilating or cooling.

3.03    Retail Space  For the purposes of this Lease, the number of square feet
        of retail and service store space in the Building, whether above or
        below grade, is calculated from dimensioned Architect's drawings to the
        inside face of permanent exterior building walls, to the face of
        permanent interior walls, to the center line of demising partitions, and
        to the center line of a predetermined lease line (usually referred to as
        the storefront line) in the case of retail and service store space
        facing onto either an interior public mall or corridor or onto a public
        street or lane. No deduction is made for vestibules inside the permanent
        exterior building walls or inside the predetermined lease line, or for
        any columns located wholly or partially within the space.


                                       4
<PAGE>

SECTION 4.00 LOADING AND DELIVERY

4.01    The delivery and shipping of merchandise, supplies, fixtures, and other
        materials or goods of any kind to or from the Premises and all loading,
        unloading, and handling of them shall be done only at such times, in
        such areas, by such means, and through such elevators, entrances, malls,
        and corridors as are designated from time to time by Landlord.

4.02    Landlord accepts no liability and is hereby relieved and released by
        Tenant in respect of the operation and adequacy of the Delivery
        Facilities, the acts or omissions of any person or persons engaged in
        the operation of the Delivery Facilities, or in the acceptance, holding,
        handling, delivery or dispatch of any goods for or on behalf of Tenant,
        and any claim of Tenant by reason of damage, loss, theft or any
        acceptance, holding, handling, delivery or dispatch, or failure of any
        acceptance, holding, handling or dispatch, or any error, negligence or
        delay in acceptance, holding, handling, or dispatch.

4.03    Landlord may from time to time make and amend regulations for the
        orderly and efficient operation of the Delivery Facilities, and may
        require the payment of reasonable and equitable charges for delivery
        services and demurrage provided by Landlord.

SECTION 5.00 NON-DISCRIMINATION

5.01    Non-Discrimination  If Tenant operates or has the right to operate under
        this Lease any store, shop, restaurant, cafeteria, restroom, or any
        other facility of a public nature in the Building, Tenant shall not
        discriminate by segregation or otherwise against any person or persons
        because of race, creed, color, or national origin in furnishing, or by
        refusing to furnish, to such person or persons the use of any such
        facility including any and all services, privileges, accommodations, and
        activities provided thereby.

5.02    Enforcement  Tenant's noncompliance with the provisions of this Section
        5.00 shall constitute a material breach of this Lease. In the event of
        such noncompliance, Landlord may take appropriate action to enforce
        compliance, may terminate this lease, or may pursue such other remedies
        as may be provided by law.


                                       5
<PAGE>

BAKER CENTER                                                           EXHIBIT C

                                  BAKER CENTER
                             RULES AND REGULATIONS

1.    Security  Landlord may from time to time adopt appropriate systems and
      procedures for the security or safety of the Building, any persons
      occupying, using or entering the same, or any equipment, finishings or
      contents thereof, and Tenant shall comply with Landlord's reasonable
      requirements relative thereto.

2.    Locks  Landlord may from time to time install and change locking
      mechanisms on entrances to the Building, common areas thereof, and the
      Premises, and (unless 24 hour security is provided by the Building) shall
      provide to Tenant a reasonable number of keys and replacements therefor to
      meet the bona tide requirements of Tenant. In these rules "keys" include
      any device serving the same purpose. Tenant shall not add to or change
      existing locking mechanisms on any door in or to the Premises without
      Landlord's prior written consent. If with Landlord's consent, Tenant
      installs lock(s) incompatible with the Building master locking system:

      (a)   Landlord, without abatement of Rent, shall be relieved of any
            obligation under the Lease to provide any service to the affected
            areas which require access thereto.

      (b)   Tenant shall indemnify Landlord against any expense as a result of
            forced entry thereto which may be required in an emergency, and

      (c)   Tenant shall at the end of the Term and at Landlord's request remove
            such lock(s) at Tenant's expense.

3.    Return of Keys  At the end of the Term, Tenant shall promptly return to
      Landlord all keys for the Building and Premises which are in possession of
      Tenant.

4.    Windows  Tenant shall observe Landlord's rules with respect to maintaining
      window coverings at all windows in the Premises so that the Building
      presents a uniform exterior appearance, and shall not install any window
      shades, screens, drapes, covers, or other materials on or at any window in
      the Premises without Landlord's prior written consent. Tenant shall ensure
      that window coverings are closed on all windows in the Premises while they
      are exposed to the direct rays of the sun.

5.    Repair, Maintenance, Alterations and Improvements  Tenant shall carry out
      Tenant's repair, maintenance, alterations and improvements in the Premises
      only during times agreed to in advance by Landlord and in a manner which
      will not interfere with the rights of other tenants in the Building.

6.    Water Fixtures  Tenant shall not use water fixtures for any purpose for
      which they are not intended, nor shall water be wasted by tampering with
      such fixtures. Any cost or damage resulting from such misuse by Tenant
      shall be paid for by Tenant.


                                        I
<PAGE>

7.    Personal Use of Premises  The Premises shall not be used or permitted to
      be used for residential, lodging or sleeping purposes or for the storage
      of personal effects or property not required for business purposes.

8.    Heavy Articles  Tenant shall not place in or move about the Premises
      without Landlord's prior written consent any safe or other heavy article
      which in Landlord's reasonable opinion may damage the Building, and
      Landlord may designate the location of any heavy articles in the Premises.

9.    Smoking Policy  Smoking is not permitted throughout the Project common
      areas to include, but not limited to, elevator lobbies, corridors and
      restrooms.

10.   Bicycles, Animals  Tenant shall not bring any animals or birds into the
      Building, and shall not permit bicycles or other vehicles inside or on the
      sidewalks outside the Building except in areas designated from time to
      time by Landlord for such purposes.

11.   Deliveries  Tenant shall ensure that deliveries of materials and supplies
      to the Premises are made through such entrances, elevators and corridors
      and at such times as may from time to time be designated by Landlord, and
      shall promptly pay or cause to be paid to Landlord the cost of repairing
      any damage in the Building caused by any person making such deliveries.

12.   Furniture and Equipment  Tenant shall ensure that furniture and equipment
      being moved into or out of the Premises is moved through such entrances,
      elevators and corridors and at such times as may from time to time be
      designated by Landlord, and by movers or a moving company approved by
      Landlord, and shall promptly pay or cause to be paid to Landlord the cost
      of repairing any damage in the Building caused thereby. Tenant shall be
      required to use a temporary hard surface to protect corridor and elevator
      carpets when moving heavy furniture in, out or about the Building.

13.   Solicitations  Landlord reserves the right to restrict or prohibit
      canvassing, soliciting or peddling in the Building.

14.   Food and Beverages  Only persons approved from time to time by Landlord
      may prepare, solicit orders for, sell, serve or distribute foods or
      beverages in the Building, or use the elevators, corridors or common areas
      for any such purpose. Except with Landlord's prior written consent and in
      accordance with arrangements approved by Landlord, Tenant shall not permit
      on the Premises the use of equipment for dispensing food or beverages or
      for the preparation, solicitation of orders for, sale, serving or
      distribution of food or beverages.

15.   Refuse  Tenant shall place all refuse in proper receptacles provided by
      Tenant at its expense in the Premises or in receptacles (if any) provided
      by Landlord for the Building, and shall keep sidewalks and driveways
      outside the Building, and lobbies, corridors, stairwells, ducts and shafts
      of the Building, free of all refuse.

16.   Obstructions  Tenant shall not obstruct or place anything in or on the
      sidewalks or driveways outside the Building or in the lobbies, corridors,
      stairwells or other common areas of the Building, or use such locations
      for any purpose except access to and exit from the Premises without
      Landlord's prior written consent. Landlord may remove at Tenants expense
      any such obstruction or thing (unauthorized by Landlord) without notice or
      obligation to Tenant.


                                       II
<PAGE>

17.   Dangerous or Immoral Activities  Tenant shall not make any use of the
      Premises which involves the danger of injury to any person, nor shall the
      same be used for any immoral purpose.

18.   Proper Conduct  Tenant shall not conduct itself in any manner which is
      inconsistent with the character of the Building as a first class building
      or which will impair the comfort and convenience of other tenants in the
      Building.

19.   Employees, Agents and Invitees  In these Rules and Regulations, Tenant
      includes the employees, agents, invitees and licensees of Tenant and
      others permitted by Tenant and others permitted by Tenant to use or occupy
      the Premises.


                                      III
<PAGE>

                               SUPPLEMENTAL TERMS
                                 AND CONDITIONS

1.    The following is added as Article 22.00:

      ARTICLE 22.00 LANDLORD'S WORK

      22.01 Landlord agrees to construct the Tenant Improvements to the Premises
            in accordance with working drawings to be approved by Landlord &
            Tenant, which upon such approval will be attached hereto and
            incorporated herein by reference as Exhibit D-3. Such working
            drawings will be based on the fit plan attached hereto as Exhibit
            D-1. Improvements to the Premises will be made using Building
            Standard Materials defined on attached Exhibit D-2.

      22.02 Any additions or modifications to the Tenant Improvements described
            in Article 22.01 and Exhibit D-1 which are requested by Tenant and
            which result in an increase in the total costs of the Tenant
            Improvements are to be paid by Tenant (plus 10% of that cost for
            coordination by Landlord).

      22.03 Provided the Lease is executed by both Landlord and Tenant, Landlord
            requires forty-five (45) days from the date Landlord and Tenant
            approve working drawings (construction drawings) to substantially
            complete the Premises for occupancy.

2.    The following is added as Article 23.00:

      ARTICLE 23.00 EXPANSION SPACE

      23.01 If Tenant is not in default under the Lease, Tenant shall have the
            option to expand after September 31, 1998, provided Tenant gives
            written notice to Landlord no earlier than nine (9) months prior to
            the date when the additional space is needed for occupancy by
            Tenant. Landlord shall notify Tenant within thirty (30) days of
            Tenant's notice whether such additional space can be accommodated
            with either contiguous or noncontiguous space in the Building
            ("Expansion Space") or by relocating Tenant to new space within the
            Project which will accommodate Tenant's Premises plus the amount of
            additional space requested by Tenant in their notice ("New
            Premises").

            Should Tenant's additional space request be accommodated through
            Expansion Space, then:

            (a)   Landlord shall build out the "Expansion Space" to be of a
                  comparable level to Tenant's existing space, based on mutually
                  approved plans; and

            (b)   Occupancy Costs for the Expansion Space shall be determined in
                  accordance with this Lease; and


                                       20
<PAGE>

            (c)   Commencement Date for the lease of Expansion Space shall be
                  the date set forth in Tenant notice to Landlord; and

            (d)   Term on the Expansion Space shall end on the later of (i) on
                  the expiration of this Lease or (ii) the last day of the
                  thirty-sixth (36th) month after the Commencement Date of the
                  Expansion Space; and

            (e)   If the expiration of the Term on the Expansion Space is later
                  than the expiration of this Lease then Tenant agrees to extend
                  the Term of this Lease to be co-terminous with the Expansion
                  Space; and

            (f)   Annual Rent on the Expansion Space and the extended term on
                  the Premises, if any, will be at Market Rent determined in
                  accordance with Article 24.00 of this Lease.

            Should Tenant's additional space be accommodated through New Space,
            then:

            (a)   Landlord shall build out the New Space to be of a comparable
                  level and layout to Tenant's existing space, based on mutually
                  approved plans; and

            (b)   Tenant agrees to amend this Lease to extend the Term to be
                  five (5) years from the date Tenant relocates to the New
                  Space; and

            (c)   Annual Rent on the New Space shall be at Market Rent
                  determined in accordance with Article 24.00 plus the recapture
                  of reduced Annual Rent under this Lease during the initial two
                  years of the Term. The calculation of such reduced rent is two
                  dollars ($2.00) per square foot during the first lease year
                  ($7,474.00) and one dollar ($1.00) per square foot during the
                  second lease year ($3,737). Such reduced rent will be
                  amortized 10% per annum and paid as additional rent over the
                  last five (5) years of the term.

            If Landlord notifies Tenant that it is unable to accommodate Tenant
            request for additional space or does not respond within thirty (30)
            days of Tenant notice and provided Tenant has greater than twelve
            (12) months remaining on its original Term, Tenant shall have the
            right to cancel this Lease with six (6) months prior written notice
            and payment to Landlord, at the time of notice, liquidated damages
            equal to unamortized transaction costs (which upon final
            determination will be set forth as Exhibit E of this Lease) plus
            seven thousand four hundred seventy-four dollars and no/100
            ($7,474.00) if canceled prior to the end of the third lease year and
            three thousand seven hundred thirty seven dollars and no/100
            ($3,737.00) if canceled after the third lease year and prior to the
            end of the fourth lease year. Transaction costs shall be equal to
            all Tenant Improvement costs and commissions paid to Madison
            Marquette Realty Services by St. Paul Properties, Inc. and will be
            amortized at 10% per annum over the term of the Lease.

      23.02 Documentation Landlord and Tenant shall execute and deliver
            appropriate documentation to evidence any additional space taken
            under this Article 23.00.


                                       21
<PAGE>

      23.03 Non-Severability The rights of Tenant under this Article 23.00 shall
            not be severed from this Lease or separately sold, assigned, or
            otherwise transferred, and shall expire on the expiration of earlier
            termination of this Lease.

3.    The following is added as Article 24.00:

      ARTICLE 24.00 MARKET RENT

      24.01 Definition "Market Rent" means the amount of cash (exclusive of
            Occupancy Costs) which a landlord would receive annually by then
            renting the space in questions assuming the landlord to be a prudent
            person willing to lease but being under no compulsion to do so,
            assuming the tenant to be a prudent person willing to lease but
            being under no compulsion to do so, assuming a lease term equal to
            the term in question, and assuming a lease containing the same terms
            and provisions as those contained in this Lease.

      24.02 Determination of Market Rent Whenever Annual Rent under this Lease
            is based on the Market Rent, Landlord shall initially determine the
            Market Rent and shall thereupon give Tenant notice of the amount of
            Annual Rent and the basis on which Landlord made its determination
            of that amount. Upon receipt of that notice, Tenant shall pay the
            Annual Rent stated in that notice in the manner set out in Article
            4.01.

      24.03 Disagreement on Market Rent

            (a)   If Tenant does not agree with the Landlord's determination of
                  Market Rent, Tenant shall nevertheless pay to Landlord the
                  amount set out in the notice Landlord gives under Article
                  21.02 and Tenant shall give notice to Landlord of that
                  disagreement within ten (10) days of receipt of that notice
                  from Landlord.

            (b)   If Tenant gives Landlord notice of disagreement, Landlord
                  shall immediately refer the matter to an individual (the
                  "Expert") selected by Landlord, subject to approval by Tenant,
                  such approval not to be unreasonably withheld, who shall be
                  deemed to be acting as an expert and not as an arbitrator. The
                  Expert shall make a determination of Market Rent as
                  expeditiously as possible.

            (c)   If the Market Rent as determined by the Expert is greater than
                  the Tenant has paid in accordance with the notice given under
                  Article 21.02, Tenant shall immediately pay to Landlord the
                  difference and shall after that make the payments of Annual
                  Rent as determined by the Expert. If the Market Rate as
                  determined by the Expert is less than Tenant has paid in
                  accordance with the notice given under Article 21.02, Landlord
                  shall immediately pay to Tenant the difference and Tenant
                  shall after that make the payments of Annual Rent as
                  determined by the Expert.

            (d)   If the Market Rent as determine by the Expert is less than 95%
                  of the amount set out in the notice under Article 21.02,
                  Landlord shall bear the costs and reasonable expenses of the
                  Expert. If the Market Rent as determined by the Expert is 95%
                  or more of the


                                       22
<PAGE>

                  amount set out in the notice under Article 21.02, Tenant shall
                  bear the costs and reasonable expenses of the Expert.

4.    The following is added as Article 25.00:

      Article 25.00 RIGHT OF FIRST OFFER

      25.01  Provided there has been no default by Tenant, Tenant shall have the
             continual "Right of First Offer" to lease the space ("Offered
             Space") containing approximately 524 square feet, more or less, on
             the fourth floor of the Peavey Building, shown crosshatched on
             Exhibit A, upon the terms and conditions set out in this Article
             25.00, if:

            (a)   Tenant is not in default under this Lease at the time such
                  option is exercised and at the time such option is to
                  commence; and

            (b)   If Landlord intends to offer for lease the "Offer Space" to
                  another party including an existing tenant, Landlord will give
                  Tenant written notification of its intent; and

            (c)   Tenant delivers their response to Landlord not later than
                  seven (7) business days following receipt of notification by
                  Landlord of their intent to lease said "Offer Space"; and

            (d)   Tenant shall have not less than twenty-four months remaining
                  on the term of its Lease. If Tenant fails to exercise its
                  right to lease the Offer Space, Tenant shall have no further
                  right to lease the Offer Space under this Article 25.01 until
                  the Offer Space has been leased and again becomes available to
                  Landlord for releasing or until two (2) months have passed if
                  the Offer Space remains unleased, provided Landlord shall not
                  then be negotiating, in good faith, a lease of such space.

      25.02 Terms A lease of space under this Article 25.00 shall contain the
            following:

            (a)   Annual Rent shall be equal to Market Rent as set out in
                  Article 24.00 as of the commencement of the Offered Space; and

            (b)   Occupancy Costs shall be determined in accordance with this
                  Lease; and

            (c)   Commencement Date for the lease of Offered Space shall be
                  thirty (30) days after the date Tenant notifies Landlord of
                  their intent to lease the Offered Space; and

            (d)   Term shall end on the expiration of this Lease; and

            (e)   The Offer Space shall be taken in "as is" condition; and

            (f)   The other terms and conditions shall be as set out in this
                  Lease.


                                       23
<PAGE>

      25.03 Documentation  Within fifteen (15) days of receipt from Landlord,
            Tenant shall execute and deliver to Landlord those instruments
            Landlord may request to evidence any lease of space under this
            Article 25.00.

      25.04 Non-Severability  The rights of Tenant under this Article 25.00
            shall not be severed from this Lease or separately sold, assigned,
            or otherwise transferred, and shall expire on the expiration or
            earlier termination of this Lease.

5.    The following is added as Article 26.00:

      Article 26.00 PARKING

      26.01 Parking  During the Term, Landlord will make available to Tenant, at
            Tenant's expense, one parking space in the Parking Facilities. The
            parking space will be for the sole use of Tenant. The parking
            agreement shall be on Landlord's standard parking agreement and at
            the monthly market rental rate from time to time in effect. Landlord
            will use reasonable efforts to accommodate Tenant's parking on level
            11 of the Parking Facility.


                                       24
<PAGE>

                           Building Standard Materials               Exhibit D-2

                                Peavey Building

In order to simplify the design process and to maintain a consistency in the
quality of the tenant finishes, the Baker Center has assembled "building
standard materials" that are recommended for use in interior construction. These
items include:

1.    Acoustical Ceiling System

      a.    Grid system - 2 x 2 suspended white metal grid - laser leveled.
      b.    Ceiling tiles - 2 x 2 recessed revealed edge textone tile
      c.    Ceiling height - 8'0" clear

2.    Light Fixtures

      2' x 4' - 3 tube, T-8 light fixture, 18 cube parabolic fixture with 4"
      depth. Landlord shall supply sufficient fixtures so as to allow a
      maintained maximum at desktop of 70-75 footcandles.

3.    Window Blinds

      1" blind

4.    Carpet

      Type 1 - 32 oz. cut pile
      Type 2 - 22 oz. level loop
      Base - 2 1/2" vinyl

5.    Wallcover

      Complete selection of 12-15 oz. type 1 in stock vinyl wallcover

6.    Wall Construction

      2 1/2" metal studs with 5/8" sheetrock - both sides. Sheetrock taped and
      sanded to accept paint or wall covering. 1 1/2" sound intimation
      insulation in demising walls.

7.    Tenant Entrances

      a.    Doors - 3'0" x 8'0" solid core oak doors stained "Medium Oak"
            mounted on hollow metal frames.

<PAGE>

      b.    Sidelights - 18" x 8'0" sidelight with 1/4" wire glass mounted in
            hollow metal frame.

      c.    Hardware - mortise lock -Entrance Sets Satin Chrome
                                    -Latch Sets Satin Chrome

8.    Interior Doors

      3'0" x 8'0" solid core oak doors - stain "Medium Oak". Slim Line Timely
      frames, painted to match tenants decorum.

9.    Sprinklers

      Concelor sprinkler heads up to a maximum of 1 per 136 usf and all
      associated piping.

<PAGE>

                                  EXHIBIT D1-B

                          DOOR AND WALL FINISH SCHEDULE

                              [FLOOR PLAN OMITTED]