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                                                                    EXHIBIT 10.3

                             OFFICE/WAREHOUSE LEASE

    THIS INDENTURE of lease, made effective this 1st day of November, 1996, by
and between 724 ASSOCIATES, a partnership (hereinafter referred to as "Lessor"),
and  CHILDREN'S BROADCASTING CORPORATION (hereinafter together referred to as
"Lessee").

                                   DEFINITIONS

    "PREMISES" - That certain real property located in the City of Minneapolis,
County of Hennepin and State of Minnesota and legally described on Exhibit "A"
attached hereto and made a part hereof, including all buildings and site
improvements located thereon.

    "BUILDING" - That certain office/warehouse building containing
approximately 42,000 square feet located upon the Premises and commonly
described as the 724 First Street North Building.

    "DEMISED PREMISES" - That certain portion of the Building located at 724
First Street North and designated as Exhibit B, consisting of approximately
4,000 square feet (4,000 square feet of office space and zero square feet of
warehouse space), as measured from the outside walls of the Demised Premises to
the center of the partition wall, as shown on the floor plan attached hereto as
Exhibit "B" and made a part hereof.  The Demised Premises include a non-
exclusive easement for access to common area, as hereinafter defined, and all
licenses and easements appurtenant to the Demised Premises.

    "COMMON AREAS" - The term "common area" means the entire areas as
designated on Exhibit "B" and to be used for the non-exclusive use by Lessee and
other lessees in the Building, including, but not limited to, corridors,
lavatories, driveways, truck docks, parking lots and landscaped areas, if any.
Subject to reasonable rules and regulations to the promulgated by Lessor, the
common areas are hereby made available to Lessee and its employees, agents,
customers and invitees for reasonable use in common with other lessees, their
employee, agents, customer and invitees.


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                              W I T N E S S E T H :

1.  TERM.  For and in consideration of the rents, additional rents, terms,
    provisions and covenants herein contained, Lessor hereby lets, leases and
    demises to Lessee the Demised Premises for the term of sixty (60) months
    commencing on the 1st day of January, 1996 (sometimes called "the
    Commencement Date") and expiring the 31st day of December, 2001 (sometimes
    called "Expiration Date"), unless sooner terminated as hereinafter
    provided.

2.  BASE RENT.  Lessor reserves and Lessee shall pay Lessor, a total rental of
    One Hundred Eighty-four Thousand and no/100 Dollars ($184,000), payable in
    advance, in monthly installments of Two Thousand Six Hundred Sixty-six and
    66/100 Dollars ($2,666.66), commencing on the Commencement Date and
    continuing on the first day of each and every month thereafter for the next
    succeeding twelve months through December, 1996, and Three Thousand and
    no/100 Dollars ($3,000.00) on the first day of each and every month
    thereafter for the next succeeding 24 months, and Three Thousand Three
    Hundred and Thirty-three and 33/100s Dollars ($3,333.33) on the first day
    of each and every month for the next succeeding 24 months during the
    balance of the term (sometimes called "Base Rent").  In the event the
    Commencement Date falls on a date other than the first of a month the
    rental for that month shall be prorated and adjusted accordingly.

3.  ADDITIONAL RENT.  Lessee shall pay to Lessor throughout the term of this
    Lease the following:

    (a)   Lessee shall pay a sum equal to one hundred percent (100%) of the
          Real Estate Taxes.  The term "Real Estate Taxes" shall mean all real
          estate taxes, all assessments and any taxes in lieu thereof which may
          be levied upon or assessed against the Premises of which the Demised
          Premises are a part.  Lessee, in addition to all other payments to
          Lessor by Lessee required hereunder shall pay to Lessor, in each year
          during the term of this Lease and any extension or renewal thereof,
          Lessee's proportionate share of such real estate taxes and
          assessments paid in the first instance by Lessor.

          Any tax year commencing during any lease year shall be deemed to
          correspond to such lease year.  In the event the taxing authorities
          include in such real estate taxes and assessments the value of any
          improvements made by Lessee, or of machinery, equipment, fixtures,
          Inventory or other


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          personal property or assets of Lessee, then Lessee shall pay all the
          taxes attributable to such items in addition to its proportionate
          share of said aforementioned real estate taxes and assessments.  A
          photostatic copy of the tax statement submitted by Lessor to Lessee
          shall be sufficient evidence of the amount of taxes and assessments
          assessed or levied against the Premises of which the Demised Premises
          are a part as well as the items taxed.

    (b)   A sum equal to one hundred percent (100%) of the annual aggregate
          operating expenses incurred by Lessor in the operation, maintenance
          and repair of the Premises.  The term "Operating Expenses" shall
          include, but not be limited to, maintenance, repair, replacement and
          care of all heating, lighting, plumbing and air conditioning
          fixtures, equipment and systems, roofs, parking and landscaped area,
          signs, snow removal, non-structural repair and maintenance of the
          exterior of the Building, insurance premiums, management fees, wages
          and fringe benefits of personnel employed for such work, cost of
          equipment purchased and used for such purposes, and the cost or
          portion thereof properly allocable to the Premises (amortized over
          such reasonable period as Lessor shall determine together with the
          interest at the rate of eighteen percent (18%) per annum on the
          unamortized balance) of any capital improvements made to the Building
          by Lessor after the Base Year which result in a reduction of
          Operation Expenses or made to the Building by Lessor after the date
          of this lease that are required under any governmental law or
          regulation that was not applicable to the Building at the time it was
          constructed.

    (c)   The payment of the sums set forth in this Article 3 shall be in
          addition to the Base Rent payable pursuant to Article 2 of this
          Lease.  All sums due hereunder shall be due and payable within thirty
          (30) days of delivery of written certification by Lessor setting
          forth the computation of the amount due from Lessee.  In the event
          the lease term shall begin or expire at any time during the calendar
          year, the Lessee shall be responsible for his pro-rata share of
          Additional Rent under subdivisions a. and b. during this Lease and/or
          occupancy time.

          Prior to commencement of this Lease, and prior to the commencement of
          each calendar year thereafter commencing during the term of this
          Lease or any renewal or extension thereof, Lessor may estimate for
          each calendar year (i) the total amount of Real Estate Taxes; (ii)
          the total amount of Operating Expenses; (iii) Lessee's share of Real
          Estate Taxes


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          for such calendar year; (iv) Lessee's share of Operating Expenses for
          such calendar year; and (v) the computation of the annual and monthly
          rental payable during such calendar year as a result of increases or
          decreases in Lessee's share of Real Estate Taxes and Operating
          Expenses.  Said estimates will be in writing and will be delivered or
          mailed to Lessee at the Premises.

          The amount of Lessee's share of Real Estate Taxes and Operating
          Expenses for each calendar year, so estimated, shall be payable as
          Additional Rent, in equal monthly installments, in advance, on the
          first day of each month during such calendar year at the option of
          Lessor.  In the event that such estimate is delivered to Lessee
          before the first day of January of such calendar year said amount, so
          estimated, shall be payable as additional rent in equal monthly
          installments, in advance, on the first day of each month over the
          balance of such calendar year, with the number of installments being
          equal to the number of full calendar months  remaining in such
          calendar year.

          Upon completion of each calendar year during the term of this Lease
          or any renewal or extension thereof, Lessor shall cause its
          accountants to determine the actual amount of the Real Estate Taxes
          and Operating Expenses payable in such calendar year and Lessee'
          share thereof and deliver a written certification of the amounts
          thereof to Lessee.  If Lessee has underpaid its share of Real Estate
          Taxes or Operating Expenses for such calendar year, Lessee shall pay
          the balance of its share of same within ten (10) days after the
          receipt of such statement.  If Lessee has overpaid its share of Real
          Estate Taxes or Operating Expenses for such calendar year, Lessor
          shall either (i) refund such excess, or (ii) credit such excess
          against the most current monthly installment or installments due
          Lessor for its estimate of Lessee's share of Real Estate Taxes and
          Operating Expenses for the next following calendar year.  A pro-rata
          adjustment shall be made for a fractional calendar year occurring
          during the term of this Lease or any renewal or extension thereof
          based upon the number of days of the term of the Lease during said
          calendar year as compared to three hundred sixty-five (365) days and
          all additional sums payable by Lessee or credits due Lessee as a
          result of the provisions of this Article 3 shall be adjusted
          accordingly.

4.  COVENANT TO PAY RENT.  The covenants of Lessee to pay the Base Rent and the
    Additional Rent are each independent of any other covenant,


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    condition, provision or agreement contained in this Lease.  All rents are
    payable to Lessor at:

                                 724 Associates
                             724 First Avenue North
                                  Fourth Floor
                          Minneapolis, Minnesota 55401

5.  UTILITIES.  Lessor shall provide mains and conduits to supply water, gas,
    electricity and sanitary sewage to the Premises.  Lessee shall pay, when
    due, all charges for sewer usage or rental, garbage disposal, refuse
    removal, water, electricity, gas, fuel, oil, L.P. gas, telephone and/or
    other utility services or energy source furnished to the Demised Premises
    during the term of this Lease, or any renewal or extension thereof.  If
    Lessor elects to furnish any of the foregoing utility services or other
    services furnished or caused to be furnished by lessor shall not exceed the
    rate Lessee would be required to pay to a utility company or service
    company furnishing any of the foregoing utilities or services.  The charges
    thereof shall be deemed Additional Rent in accordance with Article 3.

6.  CARE AND REPAIR OF DEMISED PREMISES.  Lessee shall, at all times throughout
    the term of this Lease, including renewals and extensions, and at its sole
    expense, keep and maintain the Demised Premises in a clean, safe, sanitary
    and first class condition and in compliance with all applicable laws,
    codes, ordinances, rules and regulations.  Lessee's obligations hereunder
    shall include, but not be limited to, the maintenance, repair and
    replacement, if necessary, of all lighting and plumbing fixtures and
    equipment, fixtures, motors and machinery, all interior walls, partitions,
    doors and windows, including the regular painting thereof, all exterior
    entrances, windows, doors and docks and the replacement of all broken
    glass.  When used in this provision, the term "repairs" shall include
    replacements or renewals when necessary, and all such repairs made by the
    Lessee shall be equal in quality and class to the original work.  The
    Lessee shall keep and maintain all portions of the Demised Premises and the
    sidewalk and areas adjoining the same in a clean and orderly condition,
    free of accumulation of dirt, rubbish, snow and ice.

    If Lessee fails, refuses or neglects to maintain or repair the Demised
    Premises as required in this Lease after notice shall have been given
    Lessee, in accordance with Article 36 of this Lease, Lessor may make such
    repairs without liability to Lessee for nay loss or damage that may accrue
    to Lessee's


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    merchandise, fixtures or other property or to Lessee;s business by reason
    thereof, and upon completion thereof, Lessee shall pay to Lessor all costs
    plus fifteen (15%) for overhead incurred by Lessor in making such repairs
    upon presentation to Lessee of bill therefor.

    Lessor shall repair, at its expense, the structural portions of the
    Building, provided however where structural repairs are required to be made
    by reason of the acts of Lessee, the costs thereof shall be borne by Lessee
    and payable by Lessee to Lessor upon demand.

    The Lessor shall be responsible for all outside maintenance of the Demised
    Premises, including grounds and parking areas.  All such maintenance which
    is the responsibility of the Lessor shall be provided as reasonably
    necessary to the comfortable use and occupancy of Demised Premises during
    business hours, except Saturdays, Sundays and holidays, upon the condition
    that the Lessor shall not be liable for damages for failure to do so due to
    causes beyond its control.

7.  SIGNS.  Any sign, lettering, picture, notice or advertisement installed on
    or in any part of the Premises and visible from the exterior of the
    Building, or visible form the exterior of the Demised Premises, shall be
    approved and installed by Lessor at Lessee's sole cost and expense.  Signs
    to be maintained by Lessor at Lessee's expense.  In the event of a
    violation of the foregoing by Lessee, Lessor may remove the same without
    any liability and may charge the expense incurred by such removal to
    Lessee.

8.  ALTERATIONS, INSTALLATION, FIXTURES.  Except as hereinafter provided,
    Lessee shall not make any alteration, additions or improvements in or to
    the Demised Premises  or add, disturb in any way, change any plumbing or
    wiring therein without the prior written consent of the Lessor.  In the
    event alterations are required by any governmental agency by reason of the
    use and occupancy of the Demised Premises by Lessee, Lessee shall make such
    alterations at its own expense after first obtaining Lessor's approval of
    plans and specifications therefor and furnishing such indemnifications as
    Lessor may reasonable require against liens, costs, damages and expenses
    arising of such alterations.  Alterations or additions by Lessee must be
    built in compliance with all laws, ordinances and governmental regulations
    and affecting the Premises and Lessee shall warrant to Lessor that all such
    alterations, additions or improvements shall be in strict compliance with
    all relevant laws, ordinances, governmental regulations and insurance
    requirements.  Construction of such alterations or additions shall commence


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    only once Lessee has obtained and exhibited to Lessor the requisite
    approvals, licenses and permits and indemnification against liens.  All
    alterations, installations, physical additions or improvements to the
    demised Premises made by Lessee shall at once become the property of Lessor
    and shall be surrendered to Lessor upon the termination of this Lease;
    provided, however, that this clauses shall not apply to movable equipment
    or furniture owned by Lessee which may be removed by Lessee at the end of
    the term of this Lease in the event that Lessee is not then in default.

9.  POSSESSION.  Except as hereinafter provided Lessor shall deliver possession
    of Demised Premises to Lessee in the condition required by this Lease on or
    before the Commencement Date, but delivery of possession prior to or later
    than such Commencement Date shall not affect the expiration date of this
    Lease.  The rentals herein reserved shall commence on the date actual
    possession of the Demised Premises is delivered by Lessor to Lessee.  Any
    occupancy by Lessee prior to the beginning of the term of this Lease shall
    in all respects be the same as that of a Lessee under this Lease.  Lessor
    shall have no responsibility or liability for loss or damage to fixtures,
    facilities or equipment installed or left on the Demised Premises.  If
    Demised Premises is not ready for occupancy by Commencement Date and
    possession is later than Commencement Date, rent shall begin on the date of
    actual possession.

10. SECURITY AND DAMAGE DEPOSIT.  Lessee contemporaneously with the execution
    of this Lease, deposited with Lessor the sum of Zero Dollars ($---0---),
    receipt of which is hereby acknowledged by Lessor, which deposit is to be
    held by Lessor, without liability for interest as a security and damage
    deposit for the faithful performance by Lessee during the term hereof or
    any extension hereof.  Prior to the time of when Lessee shall be entitled
    to the return of this security deposit, Lessor may commingle such deposit
    with Lessor's own funds and to use such security deposit for such purposes
    as Lessor may determine.  In the event of the failure of Lessee to keep and
    perform any of the terms, covenants and conditions of this Lease to be kept
    and performed by Lessee during the term hereof or extension hereof, then
    Lessor, either with or without terminating this Lease may (but shall not be
    required to) apply such portion of said deposit as may be necessary to
    compensate or repay Lessor for all losses or damages sustained or to be
    sustained by Lessor due to such breach on the part of Lessee, including,
    but not limited to, overdue and unpaid rent, any other amounts payable by
    Lessee to Lessor pursuant to the provisions of this Lease, damages or
    deficiencies in the reletting of Demised Premises, and reasonable
    attorney's fees incurred by Lessor.  Should the entire deposit or any
    portion thereof, be


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    appropriated and applied by Lessor, in accordance with provisions of this
    paragraph, Lessee upon written demand by Lessor shall remit forthwith to
    Lessor a sufficient amount of cash to restore said security deposit to the
    original sum deposited, and Lessee's failure to do so within five (5) days
    after receipt of such demand shall constitute a breach of this Lease.  Said
    security deposit shall be returned to Lessee, less any deposit thereof as
    the result of the provisions of this paragraph, at the end of the term of
    this Lease, or any renewal thereof or upon the earlier termination of this
    Lease.  Lessee shall have no right to anticipate return of said deposit
    withholding any amount required to be paid pursuant to the provision of
    this Lease or otherwise.

    In the event Lessor shall sell the Premises, or shall otherwise convey or
    dispose of its interest in this Lease, Lessor may assign said security
    deposit or any balance thereof to Lessor's assignee, whereupon Lessor shall
    be released from all liability for the return or repayment of such security
    deposit and Lessee shall look solely to the said assignee for the return
    and reimbursement of said security deposit.  Said security deposit shall
    not be assigned or encumbered by Lessee without the written consent of
    Lessor, and any assignment or encumbrance without such consent shall not
    bind Lessor.  In the event of any rightful and permitted assignment of this
    Lease by Lessor said security deposit shall be deemed to be held by Lessor
    as a deposit made by the assignee, and Lessor shall have no further
    liability with respect to the return of said security deposit to the
    Lessee.

11. USE.  The Demised Premises shall be used and occupied by Lessee strictly
    for the purposes of an office so long as such use is in compliance with all
    applicable laws, ordinances and governmental regulations affecting the
    Building and Premises.  The Demised Premises shall not be used in such
    manner that, in accordance with any requirement of law or of any public
    authority, Lessor shall be obliged on account of the purpose or manner of
    said use to make any addition or alteration to or in the Building.  The
    Demised Premises shall not be used in any manner which will increase the
    rates required to be paid for public liability or for fire and extended
    coverage insurance covering the Premises.  Lessee shall occupy the Demised
    Premises conduct its business and control its agents, employees, invitees
    and visitors in such a way as is lawful, and reputable and will not permit
    or create any nuisance, noise, odor, or otherwise interfere with, annoy or
    disturb any other tenant in the Building in its normal business operations
    or Lessor in its management of the Building.  Lessee's use of the Demised
    Premises shall conform to all the Landlord's rules and regulations relating
    to the use of the Premises.  Outside storage on the Premises of any type of
    equipment,


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    property or materials owned or used on the Premises by Lessee or its
    customers and suppliers shall not be permitted.

12. ACCESS TO DEMISED PREMISES.  The Lessee agrees to permit the Lessor and the
    authorized representatives of the Lessor to enter the Demised Premises at
    all times during usual business hours for the purpose of inspecting the
    same and making any necessary repairs to the Demised Premises and
    performing any work therein that may be necessary to comply with any laws,
    ordinances, rules, regulations or requirements of any public authority or
    of the Board of Fire Underwriters or any similar body or that the Lessor
    may deem necessary to prevent waste or deterioration in connection with the
    Demised Premises.  Nothing herein shall imply any duty upon the part of the
    Lessor to do any such work which, under any provision of this Lease, the
    Lessee may be required to perform and the performance thereof by the Lessor
    shall not constitute a waiver of the Lessee's default in failing to perform
    the same.  The Lessor may, during the progress of any work in the Demised
    Premises, keep and store upon the Demised Premises all necessary materials,
    tools and equipment.  The Lessor shall not in any event be liable for
    inconvenience, annoyance, disturbance, loss of business, or other damage of
    the Lessee by reason of making repairs or the performance of any work in
    the Demised Premises, or on account of bringing materials, supplies and
    equipment into or through the Demised Premises during the course thereof
    and the obligations of the Lessee under this Lease shall not thereby be
    affected in any matter whatsoever.

    Lessor reserves the right to enter upon the Demised Premises at any time in
    the event of an emergency and at reasonable hours to exhibit the Demised
    Premises to prospective purchasers or others; and to exhibit the Demised
    Premises to prospective tenants and to display "For Rent" or similar signs
    on windows and doors in the Demised Premises during the last one hundred
    eighty (180) days of the term of this Lease, all without hindrance or
    molestation by Lessee.

13. EMINENT DOMAIN.  In the event of any eminent domain or condemnation
    proceeding or private sale in lieu thereof in respect to the Premises
    during the term thereof, the following provisions shall apply:

    (a)   If the whole of the of the Premises shall be acquired or condemned by
          eminent domain for any public or quasi-public use or purpose, then
          the term of this Lease shall cease and terminate as of the date
          possession


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          shall be taken in such proceeding and all rentals shall be paid up to
          that date.

    (b)   If any part constituting less than the whole of the Premises shall be
          acquired or condemned or aforesaid, and in the event that such
          partial taking or condemnation shall materially affect the Demised
          Premises so as to render the Demised Premises unsuitable for the
          business of the Lessee, in the reasonable opinion of the Lessor, then
          the term of this Lease shall cease and terminate as of the date
          possession shall be taken by the condemning authority and rent shall
          be paid to the date of such termination.

          In the event of a partial taking or condemnation of the Premises
          which shall not materially affect the Demised Premises so as to
          render the Demised Premises unsuitable for the business of the
          Lessee, in the reasonable opinion of the Lessor, this Lease shall
          continue in full force and affect but with a proportionate abatement
          of the Base Rent and Additional Rent based on the portion, if any, of
          the Demised Premises taken.  Lessor reserves the right, at its
          option, to restore the Building and the Demised Premises to
          substantially the same condition as they were prior to such
          condemnation.  In such event, Lessor shall give written notice to
          Lessee, within thirty (30) days following the date possession shall
          be taken by the condemning authority, of Lessor's intention to
          restore.  Upon Lessor's notice of election to restore, Lessor shall
          commence restoration and shall restore the Building and the Demised
          Premises with reasonable promptness, subject to delays beyond
          Lessor's control and delays in the making of condemnation or sale
          proceeds adjustments by Lessor; and Lessee shall have no right to
          terminate this Lease except as herein provided.  Upon completion of
          such restoration, the rent shall be adjusted based upon the portion,
          if any, of the Demised Premises restored.

    (c)   In the event of any condemnation or taking as aforesaid, whether
          whole or partial, the Lessee shall not be entitled to any part of the
          award paid for such condemnation and Lessor is to receive the full
          amount of such award, the Lessee hereby expressly waiving any right
          or claim to any part thereof.

    (d)   Although all damages in the event of any condemnation shall belong to
          the Lessor whether such damages are awarded as compensation for
          diminution of value of the leasehold or to the fee of the Demised


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          Premises, Lessee shall have the right to claim and recover from the
          condemning authority, but not from Lessor, such compensation as may
          be separately awarded and recoverable by Lessee in Lessee's own right
          on account of any and all damage to Lessee's business by reason of
          the condemnation and for or on account of any cost or loss to which
          Lessee might be put in removing Lessee's merchandise, furniture,
          fixtures, leasehold improvements and equipment.

14. DAMAGE OR DESTRUCTION.  In the event of any damage or destruction to the
    Premises by fire or other cause during the term hereof, the following
    provisions shall apply:

    (a)   If the Building is damaged by fire or any other cause to such extent
          that the cost of restoration, as reasonably estimated by Lessor, will
          equal or exceed thirty percent (30%) of the replacement value of the
          Building (exclusive of foundations) just prior to the occurrence of
          the damage, then Lessor may, no later than the sixtieth (60th) day
          following the damage, give Lessee written notice of Lessor's election
          to terminate this Lease.

    (b)   If the cost of restoration as estimated by Lessor will equal or
          exceed fifty percent (50%) of said replacement value of the Building
          and if the Demised Premises are not suitable as a result of said
          damage for the purposes for which they are demised hereunder, in the
          reasonable opinion of Lessee, then Lessee may, no later than the
          sixtieth (60th) day following the damage, give Lessor a written
          notice of election to terminate this Lease.

    (c)   If the cost or restoration as estimated by Lessor shall amount to
          less than thirty percent (30%) of said replacement value of the
          Building, or if despite the cost, Lessor does not elect to terminate
          this Lease, Lessor shall restore the Building and the Demised
          Premises with reasonable promptness, subject to delays beyond
          Lessor's control and delays in the making of insurance adjustments by
          Lessor; and Lessee shall not have the right to terminate this Lease.,
          Lessor shall not be responsible for restoring or repairing leasehold
          improvements of the Lessee.

    (d)   In the event of either of the elections to terminate, this Lease
          shall be deemed to terminate on the date of the receipt of the notice
          of election and all rentals shall be paid up to that date.  Lessee
          shall have no claim against Lessor for the value of any unexpired
          term of this Lease.


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    (e)   In any case where damage to the Building shall materially affect the
          Demised Premises so as to render them unsuitable in whole or in part
          for the purposes of which they are demised hereunder, then, unless
          such destruction was wholly or partially caused by the negligence or
          breach of the terms of this Lease by Lessee, its employees,
          contractors or licensees, a portion of the rent based upon the amount
          of the extent to which the Demised Premises are rendered unsuitable
          shall be abated until repaired or restored.  If the destruction or
          damage was wholly or partially caused by negligence or breach of the
          terms of this Lease by Lessee as aforesaid and if Lessor shall elect
          to rebuild, the rent shall not abate and the Lessee shall remain
          liable for the same.

15. CASUALTY INSURANCE.

    (a)   Lessor shall at all times during the term of this Lease, at its
          expense, maintain a policy or policies of insurance with premiums
          paid in advance issued by an insurance company licensed to do
          business in the State of Minnesota insuring the Building against loss
          or damage by fire, explosion or other insurable hazards and
          contingencies for the full replacement value, provided that Lessor
          shall not be obligated to insure any furniture, equipment, machinery,
          goods or supplies not covered by this Lease which Lessee may bring
          upon the Demised Premises or any additional improvements which Lessee
          may construct or install on the Demised Premises.

    (b)   Lessee shall not carry any stock of goods or do anything in or about
          the Demised Premises which will in any way impair or invalidate the
          obligation of the insurer under any policy of insurance required by
          this Lease.

    (c)   Lessor hereby waives and releases all claims, liabilities and causes
          of action against Lessee and its agents, servant and employees for
          loss or damage to, or destruction of, the Premises or any portion
          thereof, including the buildings and other improvements situated
          thereon, resulting from fire, explosion or other perils included in
          standard extended coverage insurance, whether caused by the
          negligence of any of said persons or otherwise.  Likewise, Lessee
          hereby waives and releases all claims, liabilities and causes of
          action against Lessor and its agents, servants and employees for loss
          or damage to, or destruction of, any of the improvements, fixtures,
          equipment , supplies, merchandise and other property, whether that of
          Lessee or of others in, upon or about the


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          Premises resulting from fire, explosion or the other perils included
          in standard extended coverage insurance, whether caused by the
          negligence of any of said persons otherwise.  The waiver shall remain
          in force whether or not the Lessee's insurance shall consent thereto.

    (d)   In the event that the use of the Demised Premises by Lessee increases
          the premium rate for insurance carried by Lessor on the improvement
          of which the Demised Premises are a part, Lessee shall pay Lessor,
          upon demand, the amount of such premium increase.  If Lessee installs
          any electrical equipment that overload the power lines to the
          Building or its wiring, Lessee shall, at its own expense, make
          whatever changes are necessary to comply with the requirements of the
          insurance underwriter, insurance rating bureau and governmental
          authorities have jurisdiction.

16. PUBLIC LIABILITY INSURANCE.  Lessee shall during the term hereof keep in
    full force and effect at its own expense a policy or policies of public
    liability insurance with respect to the Demised Premises and the business
    of Lessee, on terms and with companies approved in writing by Lessor, in
    which both Lessee and Lessor shall be covered by being named as insured
    parties under reasonable limits of liability not less than: _______________
    _______________________ Dollars ($_____________) for injury or death to any
    one person: _________________________________ Dollars ($____________) for
    injury or death to more than one person; and _____________________________
    Dollars ($_____________) with respect to damage to property.  Such policy
    or policies shall provide that ten (10) days written notice must be given
    to Lessor prior to cancellation thereof.  Lessee shall furnish evidence
    satisfactory to Lessor at the time this Lease is executed, and from time to
    time, that such coverage is in full force and effect.

17. DEFAULT OF TENANT.

    (a)   In the event of any failure of Lessee to pay any rental due hereunder
          within ten (10) days after the same shall be due, or any failure to
          perform any other of the term, condition or covenant of this Lease to
          be observed or performed by Lessee for more than thirty (30) days
          after written notice of such failure shall have been given to Lessee,
          or if Lessee or an agent of Lessee shall falsify any report required
          to be furnished to Lessor pursuant to the terms of this Lease, or if
          Lessee or any guarantor of this Lease shall become bankrupt or
          insolvent, or file any debtor proceedings or any person shall take or
          have against Lessee or any guarantor of this Lease in any court
          pursuant to any statute either of the United States or of any state a
          petition in bankruptcy or


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<PAGE>

          insolvency or for reorganization or for the appointment of a receiver
          or trustee of all or a portion of Lessee's or any such guarantor's
          property, or if Lessee or any such guarantor makes an assignment for
          the benefit of creditors, or petitions for or enters into an
          arrangement, or if Lessee shall abandon the Demised Premises or
          suffer this Lease to be taken under any writ of execution, then in
          any such event Lessee shall be in default hereunder, and Lessor, in
          addition to other rights of remedies it may have, shall have the
          immediate right of re-entry and may remove all persons and property
          from the Demised Premises and such property may be removed and stored
          in a public warehouse or elsewhere at the cost of and for the account
          of the Lessee, all without service of notice or resort to legal
          process and without being guilty of trespass, or becoming liable for
          any loss or damage which may be occasioned thereby.

    (b)   Should Lessor elect to re-enter the Demised Premises as herein
          provided, or should it take possession of the Demised Premises
          pursuant to legal proceedings or pursuant to any notice provided for
          by law, it may either terminate this Lease or it may from time to
          time, without terminating this Lease, make such alterations, and
          repairs as may be necessary in order to relet the Demised Premises
          and relet the Demised Premises or any part thereof for such term or
          terms (which may be for a term extending beyond the term of this
          Lease) and at such rental or rentals and upon such other terms and
          conditions as Lessor in its sole discretion may deem advisable.  Upon
          each such subletting all rentals received by the Lessor from such
          reletting shall be applied first to the payment of any indebtedness
          other than rent due hereunder from Lessee to Lessor; second, to the
          payment of any costs and expenses of such reletting, including
          brokerage fees, attorney's fees and costs; third, to the payment of
          accrued and unpaid rent hereunder, and the remainder, if any, shall
          be held by Lessor and applied in payment of future rent as the same
          may become due and payable hereunder.  If such rentals received from
          such reletting during any month are less than that to be paid during
          that month by Lessee hereunder, Lessee, upon demand, shall pay any
          such deficiency to Lessor.  No such re-entry or taking possession of
          the Demised Premises by Lessor shall be construed as an election on
          Lessor's part to terminate this Lease unless a written notice of such
          intention be given to Lessee or unless the termination thereof be
          decreed by a court of competent jurisdiction.  Notwithstanding any
          such reletting without termination, Lessor may at any time after such
          re-entry and reletting elect to terminate this Lease for such
          previous breach.  Should Lessor at any time terminate this Lease for
          any such breach, in addition to any


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<PAGE>

          other remedies it may have, it may recover from Lessee all damages it
          may incur by reason of such breach, including the cost of recovering
          the Demised Premises, the cost of reletting the Demises premises,
          reasonable attorney's fees, and including the worth at the time of
          such termination of the excess, if any, of the amount of rent and
          charges equivalent to rent reserved in this Lease for the remainder
          of the stated term over the then reasonable rental value of the
          Demised Premises for the remainder of the stated term, all of which
          amounts shall be immediately due and payable from Lessee to Lessor.

    (c)   Lessor may, at its option, instead of exercising any other rights or
          remedies available to it in this Lease or otherwise by law, statute
          or equity, spend such money as is reasonable necessary to cure any
          default of Lessee herein and the amount so spent, and costs incurred,
          including attorney's fees in curing such default, shall be paid by
          Lessee, as Additional Rent, upon demand.

    (d)   In the event suit shall be brought for recovery of possession of the
          Demised Premises, for the recovery of rent or any other amount due
          under the provisions of this Lease or because of the breach of any
          other covenant herein contained on the part of the Lessee to be kept
          or performed, and a breach shall be established, Lessee shall pay to
          Lessor all expenses incurred therefore, including a reasonable
          attorney's fee, together with interest on all such expenses at the
          rate of eighteen percent (18%) per annum from the date of such breach
          of the covenants of this Lease.

    (e)   Lessee hereby expressly waives any and all rights of redemption
          granted by or under any present or future laws in the event of Lessee
          being evicted or dispossessed for any cause, or in the event of
          Lessor obtaining possession of the Demised Premises, by reason of the
          violation by Lessee of any of the covenants or conditions of this
          Lease, or otherwise.  Lessee also waives any demand for possession of
          the Demised Premises, and any demand for payment of rent and any
          notice of intent to re-enter the Demised Premises, or of intent to
          terminate this Lease, other than the notices provided in this
          Article, and waives any and every other notice or command prescribed
          by any applicable statutes or laws.

    (f)   No remedy herein or elsewhere in this Lease or otherwise by law,
          statute or equity, conferred upon or reserved to Lessor or Lessee
          shall be


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<PAGE>

          exclusive of any other remedy, but shall be cumulative, and may be
          exercised from time to time and as often as the occasion may arise.

18. COVENANTS TO HOLD HARMLESS.  Unless the liability for damage or loss is
    caused by the negligence of Lessor, its agents or employees, Lessee shall
    hold harmless Lessor from any liability for damages to any person or
    property in or upon the Demised Premises and the Premises, including the
    person and property of Lessee and its employees and all persons in the
    Building at its or their invitation or sufferance, and from all damages
    resulting from Lessee's failure to perform the covenants of this Lease.
    All property kept, maintained or stored on the Demised Premises shall be so
    kept, maintained or stored at the sole risk of Lessee.  Lessee agrees to
    pay all sums of money in respect of any labor, service, materials, supplies
    or equipment furnished or alleged to have been furnished to Lessee in or
    about the Premises, and not furnished on order of Lessor, which may be
    secured by any Mechanic's Materialmen's or other lien to be discharged at
    the time performance of any obligation secured thereby matures, provided
    that Lessee may contest such lien, but if such lien is reduced to final
    judgement and if such judgement or process thereon is not stayed, or if
    stayed and said stay expires, then and in each such event, Lessee shall
    forthwith pay and discharge said judgement.  Lessor shall have the right to
    post and maintain on the Demised Premises, notices of non-responsibility
    under the laws of the State in which the Demised premises are located.

19. NON-LIABILITY.  Subject to the terms and conditions of Article 14 hereof,
    Lessor shall not be liable for any damage to property of Lessee or of
    others located on the Premises, nor for the loss of or damage to any
    property of Lessee or of other by theft or otherwise.  Lessor shall not be
    liable for any injury or damage to persons or property resulting from fire,
    explosion, falling plaster, steam, gas, electricity, water, rain or snow or
    leaks from any part of the Premises or from the pipes, appliances or
    plumbing works or from the roof, street or subsurface or from any other
    place or by dampness or by any other cause of whatsoever nature.  Lessor
    shall not be liable for any such damage caused by other Lessees or persons
    in the Premises, occupants of adjacent property, other occupants of the
    buildings, or the public or caused by operations in construction of any
    private, public or quasi-public work.  Lessor shall not be liable for any
    latent defect in the Demised Premises.  All property of Lessee kept or
    stored on the Demised Premises shall be so kept or stored at the risk of
    Lessee only and Lessee shall hold Lessor harmless from any claims arising
    out of damage to the same, including subrogation claims by Lessee's
    insurance carrier.


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<PAGE>

20. SUBORDINATION.  This Lease shall be subordinated to any mortgages that may
    now exist or that may hereafter be placed upon the Demised Premises and to
    any and all advances made thereunder, and to the interest upon the
    indebtedness evidenced by such mortgages, and to all renewals, replacements
    and extensions thereof.  In the event of execution by Lessor after the date
    of this Lease of any such mortgage, renewal, replacement or extension,
    Lessee agrees to execute a subordination agreement with the holder thereof
    which agreement shall provide that:

    (a)   Such holder shall not disturb the possession and other rights of
          Lessee under this Lease so long as Lessee is not in default
          hereunder.

    (b)   In the event of acquisition of title to the Demised Premises by such
          holder, such holder shall accept the Lessee as Lessee of the Demised
          Premises under the terms and conditions of this Lease and shall
          perform all the obligations of Lessor hereunder, and

    (c)   The Lessee shall recognize such holder as Lessor hereunder.  Lessee
          shall, upon receipt of a request from Lessor therefor, execute and
          deliver to Lessor or to any proposed holder of a mortgage or trust
          deed or any proposed purchaser of the Premises, a certificate in
          recordable form certifying that this Lease is in full force and
          effect, and that there are no offsets against rent nor defenses to
          Lessee's performance under this Lease, or setting forth any such
          offsets or defenses claimed by Lessee, as the case may be.

21. ASSIGNMENT OR SUBLETTING.  Lessee agrees to use and occupy the Demised
    Premises throughout the entire term hereof for the purpose herein specified
    and for no other purposes, in the manner and to substantially the extent
    intended, and not to transfer or assign this Lease or sublet said Demised
    Premises, or any part thereof, whether by voluntary act, operation of law,
    otherwise, without obtaining the prior consent of Lessor in each instance.
    Lessee shall seek such consent of Lessor by a written request thereof
    setting forth such information as Lessor may deem necessary.  Lessor agrees
    not to withhold consent unreasonably. Consent to any assignment or
    subletting shall not relieve Lessee of its obligations hereunder. Consent
    by Lessor to an assignment of this Lease or to any subletting of the
    Demised Premises should not be a waiver of Lessor's rights under this
    Article as to any subsequent assignment or subletting.  Lessor's rights to
    assign this Lease are and should remain unqualified.  No such assignment or
    sublease or other transfer of this Lease shall be effective unless the
    assignee, sublessee or


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<PAGE>

    transferee shall at the time of such assignment, sublease or transfer,
    assume in writing for the benefit of Lessor, its successors or assigns, all
    of the terms, covenants and conditions of this Lease thereafter to be
    performed by Lessee and shall agree in writing to be bound thereby.  Should
    Lessee sublease in accordance with the terms of this Lease, fifty percent
    (50%) of any increase in rental received by Lessee over the per square foot
    rental rate which is being paid by Lessee shall be forwarded to and
    retained by Lessor, which increase shall be in addition to the Base Rent
    and Additional Rent due Lessor under this Lease.

22. ATTORNMENT.  In the event of a sale or assignment of Lessor's interest in
    the Premises, or the Building in which the Demised Premises are located, or
    this Lease, or if the Premises come into custody or possession of a
    mortgagee or any other party whether because of a mortgage foreclosure, or
    otherwise, Lessee shall attorn to such assignee or other party and
    recognize such party as Lessor hereunder; provided, however, Lessee's
    peaceable possession will not be disturbed so long as Lessee faithfully
    performs its obligations under this Lease.  Lessee shall execute, on
    demand, any attornment agreement required by any such party to be executed,
    containing such provisions and such other provisions as such party may
    require.

23. NOVATION IN THE EVENT OF SALE.  In the event of the sale of the Demised
    Premises, Lessor shall be and hereby is relieved of all of the covenants
    and obligations created hereby accruing from and after the date of sale,
    and such sale shall result automatically in the purchaser assuming and
    agreeing to carry out all the covenants and obligations of Lessor herein.
    Notwithstanding the foregoing provisions of this Article, Lessor, in the
    event of a sale of the Demised Premises, shall cause to be included in this
    agreement of sale and purchase a covenant whereby the purchaser of the
    Demised Premises assumes and agrees to carry out all the covenants and
    obligations of Lessor herein.

    The Lessee agrees at any time and from time to time upon not less than ten
    (10) days prior written request by the Lessor to execute, acknowledge and
    deliver to the Lessor a statement in writing certifying that this Lease is
    in full force and effect and stating any modifications hereto, and the
    dates to which the basic rent and other charges have been paid in advance,
    if any, it being intended that any such statement delivered pursuant to
    this paragraph may be relied upon by any prospective purchaser of the fee
    or mortgagee or assignee of any mortgage upon the fee of the Demised
    Premises.


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   <PAGE>

24. SUCCESSORS AND ASSIGNS.  The terms, covenants and conditions hereof shall
    be binding upon and inure to the successors and assigns of the parties
    hereto.

25. UNIFORM COMMERCIAL CODE.  The Lessee grants to the Lessor a lien upon all
    personal property of the Lessee in the Demised Premises during said term to
    secure payment of the rent payable hereunder, and agrees that no such
    property shall be removed from the Demised Premises without the consent of
    the Lessor while any installments of rent are past due, and during any
    other default in the conditions hereof.

    To the extent this Lease grants Lessor, or recognizes in Lessor any lien or
    rights greater than provided by the laws of the State in which the Premises
    are located pertaining to "Landlord's Liens", this Lease is intended and
    does constitute a security agreement within the meaning of the Uniform
    Commercial Code as adopted in said State, and Lessor, in addition to the
    rights prescribed herein shall have the rights, titles, liens and interests
    in and to Lessee's property now or hereafter located in or upon the Demised
    Premises which are granted a "secured party" as the term is defined under
    such Uniform Commercial Code to secure the payment to Lessor of amounts and
    monies due under this Lease.  Lessee will execute, on request of Lessor,
    and will deliver to Lessor a financing statement for the purpose of
    perfecting Lessor's security interest under this Lease or the Lessor may
    file this Lease as a security agreement.

26. QUIET ENJOYMENT.  Lessor warrants that it has full right to execute and to
    perform this Lease and to grant the estate demised, and that Lessee, upon
    payment of the rents and other amounts due and the performance of all the
    terms, conditions, covenants and agreements on Lessee's part to be observed
    and performed under this Lease, may peaceable and quietly enjoy the Demised
    Premises for the business uses permitted hereunder, subject, nevertheless,
    to the terms and conditions of this Lease.

27. RECORDING.  Lessee shall not record this Lease without the written consent
    of Lessor.  However, upon the request of either party hereto, the other
    party shall join in the execution of a Memorandum Lease for the purposes of
    recordation.  Said Memorandum Lease shall describe the parties, the Demised
    Premises and the term of the Lease and shall incorporate this Lease by
    reference.  The Article 28 shall not be construed to limit Lessor's right
    to file this Lease.


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<PAGE>

28. OVERDUE PAYMENTS.  All monies due under this Lease from Lessee to Lessor
    shall be due on demand, unless otherwise specified, and if not paid when
    due, shall bear interest at the rate of eighteen percent (18%) per annum
    until paid.

29. SURRENDER.  On the Expiration Date or upon the termination hereof upon a
    day other than the Expiration Date, Lessee shall peaceably surrender the
    Demised Premises broom-clean in good order, condition and repair,
    reasonable wear and tear only excepted.  On or before the Expiration Date
    or upon termination of this Lease on a day other than the Expiration Date,
    Lessee shall, at its expense, remove all trade fixtures, personal property
    and equipment and signs from the Demised Premises and any property not
    removed shall be deemed to have been abandoned.  Any damage caused in the
    removal of such items shall be immediately repaired by Lessee and at its
    expense.  All alterations, additions, improvements and fixtures (other than
    trade fixtures) which shall have been made or installed by Lessor or Lessee
    upon the Demised Premises and all floor covering so installed shall remain
    upon and be surrendered with the Demised Premises as a part thereof,
    without disturbance, molestation or injury, and without charge, at the
    expiration or termination of this Lease.  If the Demised Premises are not
    surrendered on the Expiration Date or the date of termination, Lessee shall
    indemnify and hold Lessor harmless against any loss or liability, claims,
    without limitation, made by any succeeding lessee founded on or related to
    such delay.  Lessee shall promptly surrender all keys for the Demised
    Premises to Lessor at the place then fixed for payment of rent and shall
    inform Lessor of combinations of any locks and safes on the Demised
    Premises.

30. HOLDING OVER.  In the event Lessee remains in possession of the Demised
    Premises after the Expiration Date of this Lease and without the execution
    of a new Lease, it shall be deemed to be occupying said Demised Premises as
    a Lessee from month to month, subject to all the conditions, provisions and
    obligations of this Lease insofar as the same can be applicable to a month-
    to-month tenancy, provided however that the Base Rent required to be paid
    by Lessee during any holdover period shall be in an amount equal to 150% of
    the most recent Base Rent amount due pursuant to the terms of the Lease per
    month, plus all Additional Rent as set forth in Article 3 of this Lease.

31. ABANDONMENT.  In the event Lessee shall remove its fixtures, equipment or
    machinery or shall vacate the Demised Premises or any part thereof prior to
    the Expiration Date of this Lease, or shall discontinue or suspend the


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<PAGE>

    operation of its business conducted on the Demised Premises for a period of
    more than thirty (30) consecutive days (except during any time when the
    Demised Premises may be rendered untenantable by reason of fire or other
    casualty), then in any such event Lessee shall be deemed to have abandoned
    the Demised Premises and Lessee shall be in default under the terms of this
    Lease.

32. CONSENTS BY LESSOR.  Whenever provision is made under this Lease for Lessee
    securing the consent or approval by Lessor, such consent or approval shall
    only be in writing.

33. NOTICES.  Any notice required or permitted under this Lease shall be deemed
    sufficiently given or secured if sent by registered or certified return
    receipt mail to Lessee at the street address of the Demised Premises and to
    Lessor at the address then fixed for the payment of rent as provided in
    Article 4 of this Lease, and either party may by like written notice at any
    time designate a different address to which notices shall subsequently be
    sent or rent to be paid.

34. RULES AND REGULATIONS.  Lessee shall observe and comply with the rules and
    regulations hereinafter set forth in "Exhibit C", and with such further
    reasonable rules and regulations as Lessor may prescribe, on written notice
    to Lessee for the safety, care and cleanliness of the Building.

35. INTENT OF PARTIES.  Except as otherwise provided herein, the Lessee
    covenants and agrees that if it shall at any time fail to pay any such cost
    or expense, or fail to take out, pay for, maintain or deliver any of the
    insurance policies above required, or fail to make any other payment or
    perform any other act on its part to be made or performed as in this Lease
    provided, then the Lessor may, but shall not be obligated so to do, and
    without notice to or demand upon the Lessee and without waiving or
    releasing the Lessee from any obligations of the Lessee in this Lease
    contained, pay any such cost or expense, effect any such insurance coverage
    and pay premiums therefor and may make any other payment or perform any
    other act on the part of the Lessee to be made and performed as in this
    Lease provided, in such manner and to such extent as the Lessor may deem
    desirable, and in exercising any such right, to also pay all necessary and
    incidental costs and expenses, employ counsel and incur and pay reasonable
    attorney's fees.  All sums so paid by Lessor and all necessary and
    incidental costs and expenses in connection with the performance of any
    such act by the Lessor together with interest thereon at the rate of
    eighteen percent (18%) per annum from the date of making of


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<PAGE>

    such expenditure by Lessor, shall be deemed Additional Rent hereunder, and
    shall be payable to Lessor upon demand.  Lessee covenants to pay any such
    sum or sums with interest as aforesaid and the Lessor shall have the same
    rights and remedies in the event of the non-payment thereof by Lessee as in
    the case of default by Lessee in the payment of the Base Rent payable under
    this Lease.

36. GENERAL.  The Lease does not create the relationship of principal and agent
    or of partnership or of joint venture or of any association between Lessor
    and Lessee, the sole relationship between the parties hereto being that of
    Lessor and Lessee.

    No waiver of any default of Lessee hereunder shall be implied from any
    omission by Lessor to take any action on account of such default if such
    default persists or is repeated, and no express waiver shall affect any
    default other than the default specified in the express waiver and only for
    the time and to the extent therein stated.  One or more waivers by Lessor
    shall not then be construed as a waiver of a subsequent breach of the same
    covenant, term or condition.  The consent to or approval by Lessor of any
    tact by Lessee requiring Lessor's consent or approval shall not waive or
    render unnecessary Lessor's consent to or approval of any subsequent
    similar act by Lessee.  Each form and each provision of this Lease
    performable by Lessee shall be construed to be both a covenant and a
    condition.  No action required or permitted to be taken by or on behalf of
    Lessor under the terms or provisions of this Lease shall be deemed to
    constitute an eviction or disturbance of Lessee's possession of the Demised
    Premises.  All preliminary negotiations are merged into and incorporated in
    this Lease.  The laws of the State of Minnesota shall govern the validity,
    performance and enforcement of this Lease.

    (a)   This Lease and the Exhibits, if any, attached hereto and forming a
          part hereof, constitute the entire agreement between Lessor and
          Lessee affecting the Demised Premises and there are no other
          agreements, either oral or written, between them other than are
          herein set forth.  No subsequent alteration, amendment, change or
          addition to this Lease shall be binding upon Lessor or Lessee unless
          reduced to writing and executed in the same form and manner in which
          this Lease is executed.

    (b)   If any agreement, covenant or condition of this Lease or the
          application thereof to any person or circumstance shall, to any
          extent, be invalid or unenforceable, the remainder of this Lease, or
          the application of such


                                       155
<PAGE>

          agreement, covenant or condition to person or circumstances other
          than those as to which it is held invalid or unenforceable, shall not
          be affected thereby and each agreement, covenant or condition of this
          Lease shall be valid and be enforced to the fullest extent permitted
          by law.

37. CAPTIONS.  The captions are inserted only as a matter of convenience and
    reference, and in no way define, limit or describe the scope of this Lease,
    the intent of the parties, or any provision of the Lease.

38. NOTIFICATION TO LESSEE.  Owner of the Premises, hereby notifies Lessee that
    the entity/person authorized to manage the Premises is CTD Properties,
    Contract Manager.  Said organization has been appointed to act as the agent
    in the leasing, management and operation of the Building for the owner and
    is authorized to accept service of process and receive and give receipts
    for notices and demands.  Lessor serves the right to change the identity or
    status of its duly authorized agents upon written notice to Lessee.

39. EXHIBITS.  Reference is made to Exhibits A through E, inclusive, which
    Exhibits are attached hereto and made a part hereof.

          Exhibit                Description
          -------                -----------
          Exhibit A              Legal Description
          Exhibit B              Demised Premises
          Exhibit C              Building Rules and Regulations
          Exhibit D              Improvements
          Exhibit E              Signs


    IN WITNESS WHEREOF, the Lessor and the Lessee have caused these presents to
be executed in form and manner sufficient to bind them at law, as of the day and
year first written above written.

LESSEE:                                 LESSOR:
CHILDREN'S BROADCASTING
CORPORATION                             CHRISTOPHER T. DAHL


By /s/James G. Gilbertson               /s/Christopher T. Dahl
  ---------------------------------     -----------------------------------
  Its COO
     ------------------------------


                                       156
<PAGE>

STATE OF MINNESOTA)
                  ) ss.
COUNTY OF HENNEPIN)

     On this 1st day of November, 1996, personally came before me, a Notary
Public within and for said County, James G. Gilbertson, CFO of Children's
Broadcasting Corporation, to me well known to be the same persons described in
and who executed the foregoing instrument, and acknowledged that they executed
the same as their free act and deed.



                                        /s/Christine A. Hein
                                        ------------------------------------
                                        Notary Public
                                        My Commission expires:  1/31/00
STATE OF MINNESOTA)
                  ) ss.
COUNTY OF HENNEPIN)

     On this 1st day of November, 1996, personally came before me, a Notary
Public within and for said County, Christopher T. Dahl, to me well known to be
the same persons described in and who executed the foregoing instrument, and
acknowledged that they executed the same as their free act and deed.



                                        /s/Christine A. Hein
                                        ------------------------------------
                                        Notary Public
                                        My Commission expires:  1/31/00


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