EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT ("Agreement"), made and entered into this 7th day
of September of 2000 effective  January 1, 2000 (the "Effective  Date"),  by and
between Prime  Companies,  Inc., a Delaware  corporation  (the  "Company"),  and
Norbert J. Lima, a resident of California ("Executive").

                                   WITNESSETH:

     WHEREAS,  the Company is a corporation  engaged in business in the State of
Delaware and throughout the United States; and

     WHEREAS,  the Company desires to employ  Executive in the capacity of Chief
Executive Officer upon the terms and conditions hereinafter set forth; and

     WHEREAS,  Executive is willing to enter into this Agreement with respect to
his employment and services upon the terms and conditions hereinafter set forth;

     NOW,  THEREFORE,  in  consideration of the mutual covenants and obligations
contained herein,  Company hereby employs Executive and Executive hereby accepts
such employment upon the terms and conditions set forth below.

1. Term of Employment.  The term of employment under this Agreement shall be for
a period of three (3) years, commencing on the Effective Date and terminating on
December 31, 2002, unless such employment is terminated or extended prior to the
expiration  of  said  period  as  hereinafter  provided.  Effective  as  of  the
expiration  of such  initial  three-year  term and as of each  anniversary  date
thereof, the term of this Agreement shall be extended for an additional one-year
period unless, not later than six (6) months prior to each such respective date,
either party hereto shall have given notice to the other that the term shall not
be so extended.  In the event of non-renewal,  and the  terminating  party shall
give notice of this  decision  not later than five and a half months  before the
anniversary  date.   Notwithstanding  the  foregoing,   Executive's   employment
hereunder may be earlier terminated as provided in ss.8 hereof.

2.       Duties of Executive.


     (a) Positions and  Reporting.  The Company hereby employs the Executive for
the Employment  Period as its President and Chief Operating Officer on the terms
and  conditions  set forth in this  Agreement.  During  the  Employment  Period,
Executive shall report directly to the Chairman on an ongoing basis and directly
to the Board of Directors of the Company (the  "Board")  with full access to the
Board except during executive sessions.

     (b)  Complete  Commitment.  Executive  agrees  that during the term of this
Agreement,  he will devote his professional and  business-related  time, skills,
and best  efforts to the  businesses  of the  Company in the  capacity  of Chief
Executive  Officer or in such other  capacities  as the  Company  may request of
Executive hereafter in writing.

     (c) Authority and Duties. Executive shall exercise such authority,  perform
such executive duties and functions,  and discharge such responsibilities as are
reasonably  associated with the  Executive's  positions,  commensurate  with the
authority  vested in the Executive  pursuant to this  Agreement,  and consistent
with the  By-Laws  of the  Company as may be  modified  from time to time by the
Board.  The Executive shall attend all Board meetings,  and the Executive agrees
to serve as a director if invited by the Board.  During the  Employment  Period,
the  Executive  shall  devote  full  business  time,  skill,  and efforts to the
business of the Company.  Notwithstanding the foregoing,  the Executive may make
and manage personal business  investments of his choice and, after first seeking
and obtaining  Board  approval,  have a second job or serve in any capacity with
any civic, educational, or charitable organization, or any trade association.
<PAGE>

     If there are major changes in the duties or  responsibilities  of Executive
from those listed above that are not mutually  agreed upon,  Executive  may give
notice of  non-acceptance  specifying  the details of his  counter-proposal  and
request to negotiate a mutually acceptable compromise. If the Parties are unable
within  thirty (30) days of the date of  Executive's  notice of  non-acceptance,
Executive  may give notice of his intention to terminate  his  employment  which
shall become  effective  sixty (60) days  thereafter  absent a mutual  agreement
otherwise and absent the Company's withdrawal of the request for changed duties,
thereby  re-establishing  the status quo ante.  Executive  agrees to continue to
fulfill his  employment  obligations  throughout the entire period of employment
and to train conscientiously a replacement if so requested,  notwithstanding any
pending notice of termination.

     (d) Other Positions.  The Company  acknowledges and agrees that, during the
term of this  Agreement,  Executive  will  devote some of his  professional  and
business-related  time,  skills,  and best efforts to Prime Companies,  Inc. and
subsidiaries of Employer including Mid-Cal Express,  Inc. and Mid-Cal Logistics,
Inc., and that Employee will not receive compensation from such subsidiaries for
his services.

3.  Compensation.  The Company  shall pay Executive an annual base salary of One
Hundred Thousand ($100,000.00) per annum (or fraction for portions of a year) to
be paid  semi-monthly  on or about the first and 15th of each  month.  Such base
salary  will be  adjusted  from time to time in  accordance  with  then  current
standard salary  administration  guidelines of the Company.  Executive's  salary
shall be subject to all  appropriate  federal  and state  withholding  taxes and
shall be  payable  in  accordance  with the  normal  payroll  procedures  of the
Company.

4. Fringe  Benefits.  The terms of this Agreement shall not foreclose  Executive
from participating with other employees of the Company in such fringe benefit or
incentive  compensation plans as may be authorized and adopted from time to time
by the  Company;  provided,  however,  that  Executive  must  meet  any  and all
eligibility   provisions   required  under  said  fringe  benefit  or  incentive
compensation  plans.  Executive  may be granted  such other  fringe  benefits or
perquisites  as Executive  and the Company may from time to time agree upon.  In
addition,  Human Resources may devise a job specific  incentive plan and present
it to Board and, if approved, to Executive.

5. Vacations. Executive shall be entitled to the number of paid vacation days in
each  calendar year as shall be determined by the Board from time to time. In no
event, however, shall Executive be entitled to less than two weeks paid vacation
during each calendar year.

6.  Reimbursement of Expenses.  The Company recognizes that Executive will incur
legitimate  business expenses in the course of rendering services to the Company
hereunder. Accordingly, the Company shall reimburse Executive, upon presentation
of receipts or other  adequate  documentation,  for all necessary and reasonable
business expenses  incurred by Executive in the course of rendering  services to
the Company under this Agreement.
<PAGE>

7. Working  Facilities.  Executive shall be furnished an office,  and such other
facilities  and  services   suitable  to  his  position  and  adequate  for  the
performance  of his duties,  which shall be consistent  with the policies of the
Company.

8. Termination.  The employment  relationship  between Executive and the Company
created  hereunder shall  terminate  before the expiration of the stated term of
this Agreement upon the occurrence of any one of the following events:

     (a)  Executive's  Death or  Permanent  Disability.  For the purpose of this
Agreement,  the  "permanent  disability"  of  Executive  shall mean  Executive's
inability,  because of his injury,  illness,  or other  incapacity  (physical or
mental), to perform the essential functions of the position contemplated herein,
with or without  reasonable  accommodation  to  Executive  with  respect to such
injury, illness, or other incapacity, for a continuous period of sixty (60) days
or for ninety (90) days out of a continuous  period of 360 days.  Such permanent
disability  shall be deemed to have occurred on the sixtieth (60th)  consecutive
day or on the  ninetieth  (90th) day within the specified  period,  whichever is
applicable.

     (b) Termination for Cause. The following events, which for purposes of this
Agreement shall constitute "cause" for termination with the majority vote of the
Board:

     (1)  The willful  breach by Executive of any  provision of Sections 11, 12,
          or 13 hereof or any act of fraud, misappropriation, or embezzlement by
          Executive  with  respect to any aspect of the  Company's  business  or
          under  circumstances  that  reflect  adversely  on the  Company in the
          public  eye,  in  each  case  in  the  Board's   sole  and   exclusive
          determination, shall be cause for immediate termination with immediate
          curtailment   of   all   compensation,   benefits   within   statutory
          limitations, and stock option rights.

     (2)  The willful breach by Executive of Section 2 hereof (including but not
          limited to a refusal to follow  lawful  directives of the Board) after
          notice to  Executive  of the  details  thereof and a period of 10 days
          thereafter  within  which  to cure  such  breach  and the  failure  of
          Executive to cure such breach to the Board's  satisfaction within such
          10 day period;

     (3)  The  use of  illegal  drugs  by  Executive  during  the  term  of this
          Agreement  that,  in the sole and  exclusive  determination  of Board,
          interferes  with  Executive's  performance of his duties  hereunder or
          under  circumstances  that  reflect  adversely  on the  Company in the
          public eye;

     (4)  The  filing  of  a  petition  in  bankruptcy   court  for  bankruptcy,
          reorganization,  or rearrangement or an adjudication that Executive is
          bankrupt;

     (5)  The  commencement  of involuntary  proceedings  against  Executive for
          bankruptcy or appointment of a receiver because of insolvency;

     (6)  If the Company  determines  that employee has engaged in any dishonest
          conduct in the course of his  management  duties  including  by way of
          example and not by limitation  the knowing  receipt of kickbacks  from
          suppliers, misappropriation of corporate assets or opportunities, etc.
<PAGE>

     (7)  If the  circumstances of Employee's  personal life,  whether or not in
          the course of  management  duties,  reflects  adversely on the Company
          such that it would be in the  Company's  best  interests,  in its sole
          discretion, to terminate its business relations with Employee.

     (8)  The dissolution of the Company's corporate status;

     (9)  Executive  is convicted of or pleads  guilty or nolo  contendere  to a
          felony or misdemeanor involving financial misconduct, moral turpitude,
          controlled  substances,  or personal  injuries caused by driving under
          the influence;

     (10) Failure of  performance  by  Executive  that is repeated or  continued
          after 30 day written  notice to  Executive of such failure and that is
          determined  by the Board to be  injurious to the business or interests
          of the Company and which failure is not cured by Executive within such
          30 day period in the Board's sole determination.

         Any notice of discharge shall describe with reasonable  specificity the
cause or causes for the  termination of Executive's  employment,  as well as the
effective date of the termination  (which effective date may be the date of such
notice). If the Company terminates Executive's employment for any of the reasons
set forth above,  the Company shall have no further  obligations  hereunder from
and after the effective date of termination (other than as set forth below).

         (c) Termination by Executive with Notice.  Executive may terminate this
Agreement  without  liability  to the Company  arising from the  resignation  of
Executive  upon a three (3) month  written  notice to the  Company.  the Company
retains the right after proper notice of  Executive's  voluntary  termination to
require  Executive to cease employment  immediately.  During such notice period,
Executive shall provide such  consulting  services to the Company as the Company
may  reasonably  request and shall assist the Company in training his  successor
and generally managing an orderly transition.

         (d)  Termination by the Company with Notice.  The Company may terminate
this Agreement at any time, with or without cause,  upon three (3) month written
notice to Executive;  provided, however, upon such notice Executive shall not be
required to perform any services for the Company other than during the period of
one (1) month immediately following the receipt of such notice of termination in
which Executive shall assist the Company in training his successor and generally
preparing for an orderly transition.

9.       Compensation Upon Termination.

     (a) General.  Upon the  termination  of Executive's  employment  under this
Agreement  before the  expiration  of the  stated  term  hereof for any  reason,
Executive shall be entitled to (i) the salary earned by him before the effective
date of termination,  as provided in Section 3(a) hereof,  prorated on the basis
of the number of full days of service  rendered by Executive  during the year to
the  effective  date of  termination,  (ii) any  accrued,  but unpaid,  vacation
benefits,  and (iii) any authorized but unreimbursed business expenses.  However
on termination,  Executive  automatically forfeits any unvested fringe benefits,
dividends,  bonuses,  and  stock  options,  and any  vesting  schedule  shall be
adjusted on a pro rata basis parallel to ss.9(a)(i) above.
<PAGE>

     (b)  Death  or  Disability.  In the  event  of  termination  of  employment
hereunder on account of Executive's death or disability,  Executive, Executive's
heirs, estate, or personal  representatives  under law, as applicable,  shall be
entitled to the  payment of  Executive's  Base  Salary as in effect  immediately
prior to death or disability  for a period of not less than two calendar  months
and not more than the earlier of six calendar  months or the payment of benefits
pursuant to a life or  disability  insurance  policy,  if any,  purchased by the
Company for Executive.  Executive,  beneficiary, or estate shall not be required
to remit to the Company any  payments  received  pursuant to any such  insurance
policy purchased by the Company. Executive is encouraged to purchase life and/or
disability   insurance  to  cover   financial  needs  resulting  from  death  or
disability.

         (c) Termination For Cause. If the employment  relationship hereunder is
terminated  by the  Company  for cause (as  defined  in  Section  8(b)  hereof),
Executive  shall  not be  entitled  to any  severance  compensation,  except  as
provided in Section 9(a) above,  subject to offset and deductions for reasonably
demonstrable damages.

         (d)   Termination   by  Executive   with  Notice.   If  the  employment
relationship is terminated by Executive  pursuant to ss.8(c) above,  the Company
shall remain  obligated to pay  Executive  his salary during the three (3) month
notice period or the remaining term of this Agreement, whichever is less.

         (e)  Termination  by  the  Company  with  Notice.   If  the  employment
relationship is terminated by the Company  pursuant to the provisions of ss.8(d)
hereof,  the Company shall remain obligated to pay Executive his salary during a
nine (9) month  severance  period,  again subject to offset and  deductions  for
reasonably demonstrable damages.

     (f) Survival.  The  provisions of Sections 9, 11, 12, 13, 14, and 20 hereof
shall survive the  termination of the employment  relationship,  irrespective of
the manner of termination absent a specific writing providing otherwise which is
signed by  Executive  and Board.  The  Parties  agree that  Executive's  breach,
violation,  or threat of breach or  violation  of such  sections  will result in
immediate and irreparable  injury and harm to the Company,  and that the Company
shall have,  in addition to any and all  remedies of law and other  consequences
under this Agreement, the right to an injunction, specific performance, or other
equitable  relief  to  prevent  the  breach  or  violation  of  the  obligations
hereunder.

     (g) Excise Tax Limit.  Notwithstanding  anything in this  Agreement  to the
contrary,  in the event it shall be determined  that any payment or distribution
by the Company or any other  person or entity to or for the benefit of Executive
is a "parachute  payment" (within the meaning of ss.280G of the Internal Revenue
Code,  whether paid or payable or distributed or  distributable  pursuant to the
terms of this  Agreement or otherwise  (a  "Payment")  in  connection  with,  or
arising  out of, his  employment  with the Company or a change in  ownership  or
effective control of the Company (within the meaning of ss.280G of the Code, and
would be subject to the excise tax imposed by ss.4999 of the Code) (the  "Excise
Tax"),  the  Payments  shall be  reduced to the  extent  necessary  so that such
remaining  Payment  would not be subject to the excise tax imposed by ss.4999 of
the Code.
<PAGE>

10.  Other  Agreements.  This  Agreement  shall be primary  with regard to other
agreements  between the Parties which are  inconsistent  in any way and shall be
deemed to alter the terms of any  executive  compensation  agreements,  deferred
compensation  agreements,  bonus agreements,  general employment benefits plans,
stock  option  plans,  and any other plans or  agreements  entered  into between
Executive and the Company  pursuant to which Executive has been granted specific
rights, benefits, or options.

11.  Non-competition.  Executive  agrees that,  during his  employment  with the
Company  and for a period of two (2) years from the date of  termination  of his
employment  with the  Company,  he will not,  without the approval of the Board,
directly or indirectly,  alone or as partner, joint venturer, officer, director,
Executive, consultant, agent, independent contractor, or stockholder (other than
as  provided  below) of any  company  or  business,  engage in any  "Competitive
Business"  within any State of the United States or Province of Canada where the
Company has staff, equipment, or facilities.  For purposes of the foregoing, the
term  "Competitive  Business" shall mean any business directly involved in those
business  activities  performed  by the Company  during  Executive's  employment
period.  Notwithstanding the foregoing, Executive shall not be prohibited during
the  non-competition  period  applicable above from acting as a passive investor
where he owns not more than five  percent  (5%) of the  issued  and  outstanding
capital stock of any publicly-held company.

12. Confidential Data.  Executive agrees that he will not at any time during the
Employment  Period or at any time  thereafter  for any reason,  in any  fashion,
form,  or  manner,  either  directly  or  indirectly,   divulge,   disclose,  or
communicate to any person, firm,  corporation,  or other business entity, in any
manner whatsoever,  any confidential information or trade secrets concerning the
business  of the Company  including,  without  limiting  the  generality  of the
foregoing,  the techniques,  methods, or systems of its operation or management,
any  information   regarding  its  financial  matters,  or  any  other  material
information  concerning  the Company's  business,  its manner of operation,  its
plans or other  material data  including  without  limitation  the  confidential
information  listed in Exhibit A. The provisions of this Section shall not apply
to (i)  information  disclosed in the  performance of Executive's  duties to the
Company  based on his good faith  belief that such a  disclosure  is in the best
interests of Company;  (ii)  information that is, at the time of the disclosure,
public knowledge; (iii) information disseminated by the Company to third parties
in the  ordinary  course of  business;  (iv)  information  lawfully  received by
Executive from a third party who, based upon inquiry by Executive,  is not bound
by a confidential  relationship  to the Company;  or (v)  information  disclosed
under a requirement of law or as directed by applicable  legal authority  having
jurisdiction over the Executive.

13.  Non-solicitation of  Customers/Employees.  Executive covenants that, during
his employment  with the Company and for a period of two (2) years from the date
of termination of his employment  with the Company,  he will not (i) directly or
indirectly  induce or attempt to induce any customer or Executive of the Company
to  terminate  his or her  business  relations  with the Company or (ii) without
prior written consent of the Company,  offer business relations either on behalf
of himself or on behalf of any other  individual  or entity to any  customer  or
employee of the Company or to any former customer or employee of the Company.
<PAGE>

14. Property of The Company.  Executive  acknowledges  that from time to time in
the course of providing  services pursuant to this Agreement,  he shall have the
opportunity  to inspect,  create,  or use certain  property,  both  tangible and
intangible,  of the Company and Executive hereby agrees that such property shall
remain the exclusive property of the Company,  and Executive shall have no right
or  proprietary  interest in such  property,  whether  tangible  or  intangible,
including,  without limitation,  Executive's  confidential information listed on
Exhibit A. In  addition,  Executive  is  retained  in a  capacity  such that his
responsibilities   may  include   the  making  of   technical   and   managerial
contributions  of value to the Company.  Executive hereby assigns to the Company
all rights,  title,  and interest in such  contributions  and inventions made or
conceived by Executive alone or jointly with others during the Employment Period
which relate to the  Business.  This  assignment  shall include (a) the right to
file  and  prosecute  patent  applications  on  such  inventions  in any and all
countries,  (b) the patent  applications filed and patents issuing thereon,  and
(c) the right to obtain copyright,  trademark,  or trade name protection for any
such  work  product.  Executive  shall  promptly  and  fully  disclose  all such
contributions  and inventions to the Company and assist the Company in obtaining
and protecting the rights therein  (including  patents thereon),  in any and all
countries; provided, however, that said contributions and inventions will be the
property  of  Company,  whether or not  patented or  registered  for  copyright,
trademark, or trade name protection, as the case may be. Inventions conceived by
the  Executive  which are not  related to the  Company's  business  or  business
activities,  shall remain the  property of the  Executive.  Executive  agrees to
return  to  the   Company   all   Company   property,   confidential/proprietary
information,  and all  copies  of the same  within  five (5) days of  employment
termination.

15. Equitable Relief. Executive acknowledges that the services to be rendered by
him  are  of  a  special,  unique,  unusual,  extraordinary,   and  intellectual
character,  which  gives them a  peculiar  value,  and the loss of which  cannot
reasonably or adequately be compensated in damages in an action at law, and that
a breach by him of any of the provisions  contained in this Agreement will cause
the Company  irreparable injury and damage. By reason thereof,  Executive agrees
that the Company  shall be  entitled,  in addition to any other  remedies it may
have under this Agreement or otherwise, to injunctive and other equitable relief
to prevent or curtail  any breach of this  Agreement  by him.  Executive  hereby
acknowledges and agrees that prohibitions set forth in ss.ss.11,  12, 13, and 14
are in addition to, and not in lieu of, any rights or remedies  that the Company
may have available  pursuant to the laws of any jurisdiction or at common law to
prevent such  violations,  and the  enforcement by the Company of its rights and
remedies  pursuant to this  Agreement  shall not be construed as a waiver of any
other rights or available  remedies  that it may possess in law or equity absent
this Agreement.

16. "Change of Control." The terms of this  Agreement  shall remain in effect in
the event that (i) the Company  becomes a subsidiary of another  corporation  or
entity  or is merged  or  consolidated  into  another  corporation  or entity or
substantially  all of the assets of the Company are sold to another  corporation
or entity; or (ii) any person, corporation, partnership, or other entity, either
alone or in conjunction  with its  "affiliates," as that term is defined in Rule
405 of the General Rules and  Regulations  under the  Securities Act of 1933, as
amended,  or  other  group  of  persons,  corporations,  partnerships,  or other
entities  who are not  "affiliates"  but who are acting in concert,  becomes the
owner of record or  beneficially  of  securities  of the Company that  represent
thirty-three  and  one-third  percent (33 1/3%) or more of the  combined  voting
power of the Company's then outstanding securities entitled to elect Directors.
<PAGE>

                            MISCELLANEOUS PROVISIONS
                            ------------------------

17.  Non-Assignment;  Successors.  Neither  party  hereto  may assign his or its
rights or  delegate  his or its duties  under this  Agreement  without the prior
written consent of the other party; provided,  however, that: (i) this Agreement
shall inure to the benefit of and be binding upon the  successors and assigns of
the Company upon any sale of all or substantially  all of the Company's  assets,
or upon any merger, consolidation, or reorganization of the Company with or into
any other corporation,  all as though such successors and assigns of the Company
and their  respective  successors  and assigns were the  Company;  and (ii) this
Agreement shall inure to the benefit of and be binding upon the heirs,  assigns,
or designees  of Executive to the extent of any payments due to them  hereunder.
As used in this  Agreement,  the term "Company"  shall be deemed to refer to any
such successor or assign of the Company referred to in the preceding sentence.

18.  Severability and  Reformation.  The parties hereto intend all provisions of
this  Agreement  to be enforced  to the fullest  extent  permitted  by law.  If,
however,  any  provision of this  Agreement is held to be illegal,  invalid,  or
unenforceable  under present or future law, such provision  shall be reformed to
effect the fullest  possible extent of the provision that is legal,  valid,  and
enforceable.  In the event that even this is not possible,  such provision shall
be fully  severable,  and this  Agreement  shall be construed and enforced as if
such illegal,  invalid, or unenforceable provision were never a part hereof, and
the remaining  provisions shall remain in full force and effect and shall not be
affected  by  the  illegal,  invalid,  or  unenforceable  provision  or  by  its
severance.

19. Construction with Articles and Bylaws. Except as explicitly modified by this
Agreement,  the provisions of the Articles and Bylaws shall remain in full force
and effect.  Notwithstanding  the  foregoing,  the  provisions of this Agreement
shall be subject to the  provisions  of the  Articles  and shall  supersede  the
Bylaws only to the extent  inconsistent  herewith,  and the  Articles and Bylaws
shall be  construed  in a manner  that  gives  effect  to the  purposes  of this
Agreement and the intent of the parties hereto.

20.  Mandatory  Mediation/Arbitration.  Given the economies of time and money as
well as enhanced prospects of swiftly restoring amicable business relations,  in
the event of a breach, default, and/or dispute between the Parties in connection
with,  arising out of, or related to this  Agreement and any aspect of relations
between the Parties including without limitation whether an issue is arbitrable,
each Party agrees  exclusively to the following terms and conditions for dispute
resolution and claims for relief including injunctive or other equitable relief.
The Parties agree to take the following actions in the following order:
(a) Mediation.  The Parties shall agree upon a neutral  mediator who is mutually
acceptable  and may be selected  from those  mediators  offered by the  Judicial
Arbitration   Mediation   Services-Endispute   ("JAMS")  in  Sacramento  or  San
Francisco, but there are advantages to finding a conveniently available mediator
close at hand who can readily  address and help resolve  problematic  matters at
the earliest  possible  stages.  If a mediator is not appointed and approved ten
(10) days after the date on which one or the other Party first seeks to retain a
mediator,  the mediator  shall be appointed by JAMS. The mediator shall have ten
(10)  business  days to resolve the matter;  and (b)  Arbitration.  If mediation
proves unsuccessful and the matter has not been resolved after ten (10) business
days, any Party (the "Complaining  Party") may seek  arbitration,  to which each
Party hereby agrees to submit to personal jurisdiction, as follows:

     (1)  Notice of Request.  The Complaining Party shall notify in writing each
          party  involved  in the  matter  that  it is  seeking  arbitration  in
          accordance  with this Section.  There shall be a period of thirty (30)
          days after the date of such notice  during which the Parties  involved
          in the matter  shall  hold with the  mediator  at least (2)  mediation
          meetings.  If, after such thirty (30) day period as expired,  such two
          (2) additional  mediation  meetings have taken place and the matter is
          not  resolved,  the  Complaining  Party  may  proceed  with  a  formal
          arbitration.

     (2)  Mutual  Designation of the  Arbitrator.  The  Complaining  Party shall
          notify the other  Party that it elects to have the  dispute  heard and
          determined by a former judge of the  California  Superior or Appellate
          Courts retained by JAMS under JAMS rules and  procedures,  and request
          that a hearing be held to resolve the  controversy  within thirty (30)
          days  after the filing of the  application  or as soon  thereafter  as
          possible. The arbitration hearing shall be held in a place agreed upon
          between the Parties and if no such  agreement  is possible  within ten
          (10) days of  discussion,  the JAMS  aribtrator  shall  designate  the
          arbitration  site. The arbitrator  shall be required to grant a remedy
          specifically requested by a party to the arbitration, and he/she shall
          have  no   authority  to  fashion  a  remedy  that  has  not  been  so
          specifically requested.

     (3)  Expediting  Resolution.  Each Party  agrees  actively to expedite  the
          resolution  of the  dispute  with all  reasonable  efforts to secure a
          hearing  within  thirty (30) days after the filing of the  Arbitration
          Petition, or as soon thereafter as possible. In more complicated cases
          upon the Arbitrator's  consent,  each Party may serve a single request
          for  admissions,   interrogatories,  and  request  for  production  of
          documents in compliance with the California  Rules of Civil Procedure,
          and  the  arbitrator  shall  have  sole  and  complete  discretion  to
          determine any discovery disputes.

     (4)  Equitable  Relief.  In the  event of an  application  for a  temporary
          restraining order or other equitable relief,  each party agrees to any
          and all  measures  necessary  to  secure  a  hearing  within  ten (10)
          business  days of the  Notice  which  may  proceed  even  without  the
          responding Party's presence, subject to proof satisfactory to the JAMS
          arbitrator that notice was effected.

     (5)  Arbitrator's  Decision  and  Confidentiality.   The  arbitrator  shall
          deliver a written  opinion  setting  forth  factual  findings  and the
          decision rationale which may be reduced to a judgment and filed in any
          court having  jurisdiction.  At the expense of the moving  party,  the
          arbitrator  shall  reconsider  the decision once upon a written motion
          submitted  and served  within ten (10)  business days of the decision.
          The  Confidentiality  provisions of this Agreement  shall apply to the
          arbitration proceeding, all evidence taken, and the opinion.
<PAGE>

     (6)  The Losing Party. The arbitrator's  award or opinion shall identify by
          name  the  party or  parties  who  shall  not  have  prevailed  in the
          arbitration  (the  "Losing  Party").  In rendering  the decision  with
          respect to any state law claims,  the arbitrator  shall apply the laws
          of the  State of  California  without  regard  to the  application  of
          principles  of  conflicts  of law.  The  arbitrator  shall  assess all
          expenses of arbitration and mediation,  including but not specifically
          limited to all forms of mediator's fees,  arbitration fees, costs, and
          attorneys' fees in accordance with Paragraph 20(a) of this Agreement.

     (7)  Attorneys'  Fees  and  Costs.  The  costs  and  expenses  incurred  in
          connection with any attempt at mediation  described  above,  including
          JAMS' and the mediator  fees,  shall be shared  equally  among all the
          Parties  involved in such mediation,  with each party  responsible for
          its own attorneys'  fees, if the mediation  successfully  resolves the
          matter,  or if the matter is otherwise  resolved without  arbitration.
          However,  if  the  matter  is  arbitrated,  the  Losing  Party  in the
          arbitration  shall  pay  all the  mediation  costs  including  but not
          specifically  limited to the  mediator's  fees and  disbursements  and
          attorneys' fees of the parties who are not the Losing Party as well as
          all costs and expenses of arbitration  including but not  specifically
          limited to JAMS'  fees,  attorneys'  fees of  parties  who are not the
          Losing Party and costs,  plus  attorneys' fees incurred to enforce any
          award or opinion entered in any court having jurisdiction  thereof. If
          more than one party constitutes the Losing Party, as determined by the
          arbitrator, all such parties shall be jointly and severally liable for
          all costs and expenses of mediation and/or arbitration.

     (8)  Full Assessment as Incentive for Resolution by Mediation. For purposes
          of this Section,  the phrase "costs and expenses"  shall  include,  in
          addition to those items  enumerated  above,  discovery  costs, air and
          ground transportation,  lodging,  meals, and related items advanced or
          incurred by necessary  parties to the  arbitration  and by  witnesses,
          investigators,  accountants,  and attorneys  participating  in the who
          reside outside Northern California.  For purposes of this Section, the
          term  "attorney's  fees"  shall mean the full and  actual  cost of any
          legal services  actually  performed in connection  with the matter for
          which such fees are sought,  calculated on the basis of the usual fees
          charged by the attorneys performing such services, and such fees shall
          not be limited  to  "reasonable  attorney's  fees" as that term may be
          defined by statutory or decisional  authority.  Judgment on such award
          may be  entered  in any court  having  jurisdiction  over the  subject
          matter  of  the  controversy   and  shall   thereafter  be  deemed  an
          enforceable judgment.

     (c)  Enforceability.  This Agreement will be  enforceable,  the arbitration
order/award  will be final,  and judgment thereon may be entered in any court of
competent jurisdiction.  Any complaint,  adversarial claim, or action related to
this Agreement  prosecuted in any  jurisdiction  or forum other than as provided
herein shall be null and void.

     (d)  Survivability.  This provision  shall survive the  termination of this
Agreement. This agreement to arbitrate shall be specifically  enforceable,  each
Party  waiving  rights to jury trial and appeal in the  interests of  maximizing
economy,  privacy,  and swift resolution while minimizing expense,  hostilities,
and delay.

<PAGE>


21. Notices.  All notices and other  communications  required or permitted to be
given  hereunder shall be in writing and shall be deemed to have been duly given
if delivered personally,  mailed by certified mail (return receipt requested) or
sent by overnight delivery service,  cable, telegram,  facsimile transmission or
telex to the parties at the  following  addresses or at such other  addresses as
shall be specified by the parties by like notice:

                  (a)      If to Employer:  Prime Companies, Inc.
                                            409 Center Street
                                            Yuba City, CA 95991
                                            (530) 755-3580
                                            Facsimile: (530) 671-3215
                                            e-mail: adminpri@primecompanies.com

                  (b)      If to Executive: Norbert J. Lima
                                            409 Center Street
                                            Yuba City, CA 95991
                                            (530) 674-2590
                                            Facsimile: (530) 671-3215
                                            e-mail: nlima@primecompanies.com

                  (c)      and in all cases to: Mr. Irving Pfeffer, Esq.
                                                155 Montgomery Street, Suite 609
                                                San Francisco, CA  94104
                                                (415) 296-7272
                                                Facsimile: (415) 296-8780
                                                e-mail: pfefferlaw@aol.com
                                                       ------------------

or to such other  respective  addresses as the Parties hereto shall designate to
the other by like notice,  provided  that notice of a change of address shall be
effective only upon receipt thereof.

         Notice  so given  shall,  in the case of  notice  so given by mail,  be
deemed to be given and received on the fourth calendar day after posting, in the
case of notice so given by  overnight  delivery  service,  on the date of actual
delivery  and,  in the case of  notice so given by  cable,  telegram,  facsimile
transmission,  telex, or personal delivery,  on the date of actual  transmission
or, as the case may be, personal delivery, in each case followed by posting with
the U. S. Postal  Service by certified  mail.  The Parties  further  consent and
agree that notice given  pursuant to this section shall be effective in securing
personal jurisdiction for dispute resolution with JAMS.

22. Further  Actions.  Whether or not  specifically  required under the terms of
this  Agreement,  each Party hereto shall execute and deliver such documents and
take such  further  actions  as shall be  necessary  in order for such  party to
perform all of his or its  obligations  specified  herein or reasonably  implied
from the terms hereof.


<PAGE>

23. Waiver of Breach.  Any waiver of any breach of this  Agreement  shall not be
construed to be a continuing  waiver or consent to any subsequent  breach on the
part either of the Executive or Company.

24.  Governing  Law.  This  agreement  shall be  governed  by and  construed  in
accordance with the internal law, and not the law of conflicts,  of the State of
California.

25. Assignment.  This Agreement is personal to Executive and may not be assigned
in any way by Executive  without the prior written consent of the Company.  This
Agreement shall not be assignable or delegable by the Company,  other than to an
affiliate of the  Company,  except if there is a Change of Control as defined in
Section 16, the Company may assign its rights and  obligations  hereunder to the
person, corporation, partnership or other entity that has gained such control.

26.  Interpretation.  Neither this  Agreement nor any  amendment  hereto nor any
uncertainty  or ambiguity  herein  shall be  construed  or resolved  against the
Company or Employee, whether under any rule of construction or otherwise. On the
contrary,  this Agreement and any amendment has been reviewed by all parties and
shall be construed  and  interpreted  according  to the ordinary  meaning of the
words used so as to fairly accomplish the purposes and intentions of the parties
hereto.  The normal rule of  construction to the effect that any ambiguities are
to be resolved  against the drafting party shall not be used in the construction
or the interpretation of this Agreement or any amendments hereto.

27. Entire  Agreement & Modification:  This Agreement  merges and supersedes all
prior agreements,  negotiations,  warranties,  and representations by or between
the Parties on the subjects addressed herein,  whether oral,  written,  or both,
and  constitutes the entire  understanding  with respect to this subject matter.
Any  inconsistencies  or  ambiguities  shall not be  interpreted  for or against
either Party.  This Agreement may be modified only with a writing signed by both
Parties and  approved by the Board,  may be signed in  counterparts,  and may be
deemed an original including signature pages even in facsimile copy. No promise,
warranty,  representation,  or amendment  shall be binding unless in writing and
signed by the Party to be charged.

28.  Good  Faith.  The Parties  intend and agree that their  respective  rights,
duties,  powers,  liabilities,  obligations,  and  discretionary  acts  shall be
performed,  carried out, discharged,  and exercised reasonably in good faith and
in fair  dealing  with  the  other  Party,  shareholders,  directors,  officers,
employees, customers, and suppliers of the Company.

         IN WITNESS WHEREOF, the Parties hereto have executed this Agreement.

PRIME COMPANIES, INC.


By: /s/ Nobert Lima                         By: /s/ Stephen Goodman
     ---------------                           -------------------
Name: Norbert J. Lima                        Name: Stephen Goodman
Title: Chief Executive Officer               Title: Chief Financial Officer

<PAGE>




EXECUTIVE:                                        APPROVED BY THE BOARD:



By:/s/ Norbert Lima                               By:/s/ Stephen Goodman
     ----------------                                  -------------------
      Norbert J. Lima                            Name:Stephen Goodman, Secretary

<PAGE>


                EXHIBIT A - CONFIDENTIAL/PROPRIETARY INFORMATION

         Generally,   the  Company's   confidential  and  propriety  information
includes all  property,  tangible and  intangible,  regardless  of how stored in
writing, magnetically encoded,  photographic,  laser imprinted, or computerized,
etc. Upon termination of employment,  Executive shall be entitled only to remove
his   personal   belongings.   More   specifically   but   without   limitation,
Confidential/Proprietary Information includes the following:

     1.   All Company trade secrets and all business plans  including  strategic
          plans,  product plans,  marketing plans,  financial  plans,  operating
          plans,  resource plans,  all research and development  plans including
          all  records,  data,  illustrations,  computer  files,  and any  other
          documentation produced by or related to such efforts;

     2.   All  Company  business  records  including  customer,   supplier,  and
          personnel lists and information,  all internally  prepared  documents,
          all sales, accounting, and business activity records and files;

     3.   All  documents,   software,   records,   files,   internal   policies,
          procedures,  methods,  and  approaches  which have been  developed  or
          adopted by to Prime Companies, Inc. and are not public.

     3.   Any  information  relating  to  the  marketing,   pricing,  contracts,
          discounting,  employment, job responsibility,  performance,  salaries,
          and personnel compensation of any other employee with the Company.

     4.   Any  information,  knowledge,  or  data  that  Executive  receives  in
          confidence  or acquires  from the Company or its staff or customers or
          that  Executive may develop  during the course of his  employment  and
          which  relates to or is a trade secret of the company or its customers
          as contained  in formulas,  patterns,  toolings,  devices,  processes,
          methods, machines,  compositions,  discoveries,  inventions,  designs,
          compilations     of     information,      records,     specifications,
          customer/employee/supplier lists, or otherwise.